Newsletter

December 10, 2010 - NRF Supports Jewelry Retailer in Friend of the Court Brief

NRF has filed a brief in federal court supporting a nationwide jewelry chain’s position that imposing class action arbitration on parties who have not agreed to class arbitration is inconsistent with federal law.

“Because this case involves important questions regarding an arbitrator’s authority to impose complex, expensive, time-consuming, litigation-like proceedings on an employer who never agreed to such proceedings, it is a matter of vital interest to the NRF and its membership,” NRF attorneys said. “Both the employer and employee have strong interests in keeping the dispute resolution process simple. … Otherwise the entire process could become overburdened and many of the major benefits that alternative dispute resolution procedures typically provide could be lost.”

Sterling Jewelers Inc., a subsidiary of Signet Jewelers Limited and parent of the Kay Jewelers and Jared the Galleria of Jewelry chains, requires employees to agree to an arbitration agreement as a condition of employment.
A group of 15 current and former female workers who brought claims for sex bias in 2009 sought arbitration, but rather than seeking that their claims be brought individually asked that they be addressed as a class action. The arbitrator agreed, but Sterling objected because its arbitration agreement is silent on the issue of whether cases can be handled on a class action basis. A U.S. District Court judge agreed with Sterling and vacated the arbitrator’s decision to treat the cases as a class action, but the plaintiffs have appealed and the case is now before the Second Circuit U.S. Court of Appeals in New York.

NRF’s amicus brief was filed with the Second Circuit this week. The case is believed to be the first appeal in the federal circuit courts to address the scope of the U.S. Supreme Court’s decision in Stolt-Nielsen S.A. v. AnimalFeeds International Corp., which determined that imposing class arbitration on parties who have not agreed to authorize class arbitration is inconsistent with the Federal Arbitration Act.

© 2010 National Retail Federation