Cedar Fair, L.P. v. Falfas (Slip Opinion)
140 Ohio St. 3d 447
| Ohio | 2014Background
- Falfas was promoted to COO of Cedar Fair under a written employment agreement.
- In June 2010 Cedar Fair reportedly terminated Falfas without cause, leading to arbitration.
- Arbitration ordered reinstatement of Falfas to his pre-termination position, with backpay and benefits.
- The trial court and appellate court disagreed on whether reinstatement was within the arbitrator’s powers.
- The contract contains sections 7 (termination without cause), 10 (for cause), 11 (resignation), and 19(c) (arbitration remedies).
- Ohio Supreme Court held that specific performance is not an available remedy for breach of an employment contract absent explicit contract or statute.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is reinstatement available as a remedy for breach of an employment contract? | Falfas argues 19(c) allows reinstatement as a remedy. | Cedar Fair argues reinstatement is not permitted absent explicit contract terms. | No; reinstatement not available absent explicit contract or statute. |
| Does Section 19(c) authorize reinstatement as a remedy? | Arbitrator could award reinstatement under 19(c). | 19(c) does not authorize reinstatement absent clear contract language. | No; 19(c) does not authorize reinstatement as a general remedy. |
| Did the arbitration panel exceed its powers by ordering reinstatement? | Panel acted within contract and applicable law to reinstate. | Panel exceeded powers by ordering reinstatement contrary to contract terms. | Yes; panel exceeded its powers. |
| What remedy does the contract provide for non-cause termination? | Section 7 liquidated-damages/continuing compensation justified reinstatement. | Section 7 provides only back pay/benefits; reinstatement not authorized. | Back pay and benefits under Section 7; not reinstatement. |
Key Cases Cited
- Masetta v. Natl. Bronze & Aluminum Foundry Co., 159 Ohio St. 306 (1953) (no specific performance of an employment contract absent clear contract or statute)
- Goodyear Tire & Rubber Co. v. Local Union No. 200, United Rubber, Cork, Linoleum & Plastic Workers of Am., 42 Ohio St.2d 516 (1975) (arbitrator authority limited to contract; Supreme Court limited grounds to vacate awards)
- Ohio Civ. Serv. Emps. Assn., Local 11, AFSCME v. Ohio, 59 Ohio St.3d 177 (1991) (arbitration award vacatur limited; deference to contract interpretation)
- Worrell v. Multipress, Inc., 45 Ohio St.3d 241 (1989) (front pay noted; reinstatement not always feasible; context is ADEA)
- Wright v. Weyandt, 50 Ohio St.2d 194 (1977) (reinstatement may be enforced where clear bargained-for promise in settlement)
- Stolt–Nielsen, S.A. v. AnimalFeeds Int'l Corp., 559 U.S. 662 (2010) (arbitration awards must draw their essence from the contract; not arbitrary)