Scholarly Commons @ IIT Chicago-Kent College of Law

Article Title

Lewis's Shifting Concepcions: The Seventh Circuit's Struggle in Applying Class Action Preemption in Employment Contracts

Authors

Matthew Hamielec

Abstract

Class actions and arbitrations have has existed since the United States' nascence. Since the mid-twentieth century, both Congress, through statutes like the Federal Arbitration Act ("FAA"), and the Supreme Court, in interpreting such statutes as favoring arbitration, have fostered arbitration's growth. While businesses incorporated arbitration provisions into various contracts thinking they would arbitrate with claimants individually, plaintiffs' attorneys pushed for courts' allowance of class arbitration, a class proceeding conducted within an arbitration's confines. Corporations litigated class arbitrations' legitimacy; their efforts culminated in American Express Co. v. Italian Colors Restaurant, where a divided Supreme Court upheld individual arbitration provisions in a pre-dispute contract, and foreclosed class arbitrations in many contexts. Even though Italian Colors' plaintiffs could not functionally pursue their claims individually, the Court found that certain statutes interpreted as allowing class arbitration could not steamroll over other laws like the FAA.

Now, Lewis v. Epic Systems Corp. seeks to distinguish itself from Italian Colors. In Lewis, the Seventh Circuit opined that the National Labor Relations Act-which expressly grants employees a right to collective suits-qualified as an exception to Italian Colors and to the FAA's enforcement of arbitration provisions. Per the FAA's savings clause, anything that proscribed such an express right was unenforceable. Lewis splits the circuits on this issue, and introduces an opportunity for Supreme Court resolution. This Note assesses the arguments advanced by various groups invested in Lewis's issues, and urges the Court to uphold Lewis's interpretation of the FAA over other Circuits' competing analyses. It is this Note's goal to highlight to its audience that, if the Supreme Court overturns Lewis's holding, the class action mechanism, alongside individuals' access to courts for civil harms, will continue its march toward extinction.

Class actions and arbitrations have has existed since the United States' nascence. Since the mid-twentieth century, both Congress, through statutes like the Federal Arbitration Act ("FAA"), and the Supreme Court, in interpreting such statutes as favoring arbitration, have fostered arbitration's growth. While businesses incorporated arbitration provisions into various contracts thinking they would arbitrate with claimants individually, plaintiffs' attorneys pushed for courts' allowance of class arbitration, a class proceeding conducted within an arbitration's confines. Corporations litigated class arbitrations' legitimacy; their efforts culminated in American Express Co. v. Italian Colors Restaurant, where a divided Supreme Court upheld individual arbitration provisions in a pre-dispute contract, and foreclosed class arbitrations in many contexts. Even though Italian Colors' plaintiffs could not functionally pursue their claims individually, the Court found that certain statutes interpreted as allowing class arbitration could not steamroll over other laws like the FAA.

Now, Lewis v. Epic Systems Corp. seeks to distinguish itself from Italian Colors. In Lewis, the Seventh Circuit opined that the National Labor Relations Act-which expressly grants employees a right to collective suits-qualified as an exception to Italian Colors and to the FAA's enforcement of arbitration provisions. Per the FAA's savings clause, anything that proscribed such an express right was unenforceable. Lewis splits the circuits on this issue, and introduces an opportunity for Supreme Court resolution. This Note assesses the arguments advanced by various groups invested in Lewis's issues, and urges the Court to uphold Lewis's interpretation of the FAA over other Circuits' competing analyses. It is this Note's goal to highlight to its audience that, if the Supreme Court overturns Lewis's holding, the class action mechanism, alongside individuals' access to courts for civil harms, will continue its march toward extinction.

Class actions and arbitrations have has existed since the United States' nascence. Since the mid-twentieth century, both Congress, through statutes like the Federal Arbitration Act ("FAA"), and the Supreme Court, in interpreting such statutes as favoring arbitration, have fostered arbitration's growth. While businesses incorporated arbitration provisions into various contracts thinking they would arbitrate with claimants individually, plaintiffs' attorneys pushed for courts' allowance of class arbitration, a class proceeding conducted within an arbitration's confines. Corporations litigated class arbitrations' legitimacy; their efforts culminated in American Express Co. v. Italian Colors Restaurant, where a divided Supreme Court upheld individual arbitration provisions in a pre-dispute contract, and foreclosed class arbitrations in many contexts. Even though Italian Colors' plaintiffs could not functionally pursue their claims individually, the Court found that certain statutes interpreted as allowing class arbitration could not steamroll over other laws like the FAA.

Now, Lewis v. Epic Systems Corp. seeks to distinguish itself from Italian Colors. In Lewis, the Seventh Circuit opined that the National Labor Relations Act-which expressly grants employees a right to collective suits-qualified as an exception to Italian Colors and to the FAA's enforcement of arbitration provisions. Per the FAA's savings clause, anything that proscribed such an express right was unenforceable. Lewis splits the circuits on this issue, and introduces an opportunity for Supreme Court resolution. This Note assesses the arguments advanced by various groups invested in Lewis's issues, and urges the Court to uphold Lewis's interpretation of the FAA over other Circuits' competing analyses. It is this Note's goal to highlight to its audience that, if the Supreme Court overturns Lewis's holding, the class action mechanism, alongside individuals' access to courts for civil harms, will continue its march toward extinction.

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Recommended Citation

Matthew Hamielec, Lewis's Shifting Concepcions: The Seventh Circuit's Struggle in Applying Class Action Preemption in Employment Contracts, 12 Seventh Circuit Rev. 92 (2017).
Available at: https://scholarship.kentlaw.iit.edu/seventhcircuitreview/vol12/iss1/5