2013 Ohio 5527
Ohio Ct. App.2013Background
- Finish Line sued former employee Marrissa Patrone (Aug 20, 2010) to recover amounts alleged owed on a corporate credit card; Patrone answered and counterclaimed for wrongful discharge and discrimination and removed the case to common pleas court.
- At hire Patrone signed an agreement to resolve disputes by arbitration; the detailed arbitration procedures were in a separate Employee Dispute Resolution Plan.
- Finish Line filed its complaint without invoking the arbitration agreement and later (Apr 15, 2011) answered Patrone’s counterclaim without asserting arbitration as a defense.
- More than a year after filing its complaint and months after answering the counterclaim, Finish Line moved (Sept 6, 2011) to stay proceedings and compel arbitration; Patrone opposed the motion.
- The magistrate and trial court found Finish Line waived its right to arbitrate by initiating litigation and failing to timely assert arbitration; the trial court denied the stay and this appeal followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether filing suit without demanding arbitration waives the right to arbitrate | Finish Line: filing suit does not necessarily waive arbitration; federal/state law favors arbitration and waiver requires prejudice | Patrone: filing a lawsuit and litigating without invoking arbitration evidences waiver; answering without demanding arbitration confirms waiver | Court: Filing suit and failing to timely invoke arbitration waived the right; motion to stay denied |
| Whether an anti‑waiver clause permits post‑filing invocation of arbitration | Finish Line: could rely on authority allowing arbitration after filing where contracts contain anti‑waiver language | Patrone: no anti‑waiver provision in this contract; those cases are distinguishable | Court: No anti‑waiver clause here; cases permitting post‑filing arbitration do not apply |
| Whether federal law (FAA) displaces state waiver rules to require arbitration | Finish Line: FAA and Supreme Court precedent favor arbitration and preempt conflicting state rules | Patrone: Ohio waiver doctrine does not prohibit arbitration of claim types; this is a procedural waiver issue | Court: FAA does not displace Ohio waiver rule here; waiver controls |
| Whether Arb. clause was unenforceable as procedurally/substantively invalid (knowledge, unconscionability, fee‑splitting) | Finish Line: clause valid, knowingly executed, and fee‑splitting severable | Patrone: clause potentially unconscionable and prohibitively expensive; knowledge/voluntariness disputed | Court: Moot — waiver resolved the case; court did not reach validity questions |
Key Cases Cited
- Mills v. Jaguar-Cleveland Motors, Inc., 69 Ohio App.2d 111 (Ohio Ct. App. 1980) (party who files suit rather than requesting arbitration waives the right)
- Harsco Corp. v. Crane Carrier Co., 122 Ohio App.3d 406 (Ohio Ct. App. 1997) (recognizing waiver by inconsistent conduct and review under abuse of discretion)
- Griffith v. Linton, 130 Ohio App.3d 746 (Ohio Ct. App. 1998) (supporting precedent that initiating suit can waive arbitration)
- Jones v. Honchell, 14 Ohio App.3d 120 (Ohio Ct. App. 1983) (same)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (Ohio 1983) (standard for abuse of discretion on appellate review)