FD Frontier Drilling (Cyprus) Ltd. Frontier Drilling USA, Inc., Frontier Drilling AS And Noble Drilling (U.S.) L.L.C. v. Steve Didmon
438 S.W.3d 688
| Tex. App. | 2014Background
- FD Frontier entities argue for arbitration of Didmon's Jones Act/personal injury claims under the EEA arbitration clause; Didmon alleges injuries aboard the D/S Frontier Phoenix offshore near Singapore (Dec 11, 2009).
- Frontier AS owned the vessel; Frontier USA is its Texas-based subsidiary; Frontier Cyprus payroll covered Didmon when the incident occurred; Noble Drilling acquired Frontier entities after the incident.
- Didmon signed an Expatriate Employment Agreement (EEA) containing a Singapore arbitration clause under SIAC Rules; the EEA states it is the entire agreement and may only be amended in writing.
- Didmon signed an ADR later stating resolution of all claims against Frontier and related entities; the ADR includes broad tort, discrimination, and other claims but later raised questions about its effect.
- A federal district court found the ADR unenforceable because it was not properly signed by Frontier; it remanded to state court, and the state court later denied arbitration under the EEA, prompting this interlocutory appeal.
- The issue is whether the EEA's broad arbitration clause covers Didmon's tort claims and whether federal law governs the scope analysis under the FAA/Convention.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of EEA arbitration clause | Didmon: EEA is broad; encompasses torts. | Frontier: EEA limited to contract disputes. | EEA scope includes tort claims; arbitration required. |
| Governing law for scope determination | Apply state contract formation principles. | Apply federal law for scope under FAA. | Federal law governs scope when enforcing arbitration under FAA. |
| Effect of ADR on EEA terms | ADR tried to override EEA. | ADR cannot vary clear EEA terms. | ADR does not modify EEA; analyze EEA language alone. |
| Interaction of intertwined facts with contract | Didmon's Jones Act claim relates to employment contract. | Claims are independent of contract. | Jones Act claims are sufficiently related to contract to be arbitrable. |
| Court’s scope interpretation | Clauses like “any dispute arising out of or in connection with this contract” are broad. | Clause is narrow if not tied to contract disputes. | Clause broad; covers disputes arising out of or relating to the contract. |
Key Cases Cited
- Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (U.S. 1983) (strong policy favoring arbitration; scope resolved in favor of arbitration)
- In re Weekley Homes, L.P., 180 S.W.3d 127 (Tex. 2005) (state law governs formation; federal law governs scope under FAA)
- In re Labatt Food Serv., L.P., 279 S.W.3d 640 (Tex. 2009) (state vs federal law in arbitration scope; de novo review of scope)
- Pennzoil Exploration & Prod. Co. v. Ramco Energy, Ltd., 139 F.3d 1061 (5th Cir. 1998) (broad vs narrow arbitration clauses; interpretation of scope)
- Marinechance Shipping, Ltd. v. Sebastian, 143 F.3d 216 (5th Cir. 1998) (forum clauses; broad arbitration reach includes tort claims arising during employment)