Richard A. Messina v. North Central Distributing, 821 F.3d 1047

Messina signed an employment contract and a separate arbitration agreement in California in Aug. 2012 and worked for Yosemite until terminated Jan. 2013.
Messina sued Yosemite in Minnesota state court for breach of contract and wrongful termination on July 1, 2014; service occurred July 7, 2014.
Yosemite removed to federal court, answered (raising 24 affirmative defenses) and never mentioned arbitration; parties filed a Rule 26(f) report proposing discovery deadlines and an Aug. 2015 trial date.
Yosemite moved to transfer venue to the Eastern District of California in Nov. 2014 and litigated the transfer; the district court denied the transfer in Jan. 2015.
Yosemite first disclosed the arbitration agreement in Feb. 2015 and moved to compel arbitration in Mar. 2015—over eight months after the suit began.
The district court found Yosemite knew of the arbitration right, acted inconsistently by invoking litigation machinery, prejudiced Messina, and therefore waived arbitration; the Eighth Circuit affirmed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Yosemite waived its contractual right to arbitrate Messina's claims by litigating in federal court for eight months without asserting arbitration	Messina argued Yosemite knew of the arbitration agreement, substantially invoked litigation (removal, answer, Rule 26 report, motion to transfer, scheduling conference), caused delay and expense, and thus waived arbitration	Yosemite argued it possessed the arbitration agreement but did not timely move only because it pursued a transfer; it sought arbitration promptly after losing the transfer motion	Court held Yosemite waived arbitration: it knew of the right, acted inconsistently by substantially invoking litigation, and prejudiced Messina through delay and duplication of effort

Lewallen v. Green Tree Servicing, LLC, 487 F.3d 1085 (8th Cir. 2007) (three-part waiver test: knowledge, inconsistent acts, prejudice; doubts resolved for arbitration)
Cabinetree of Wis., Inc. v. Kraftmaid Cabinetry, Inc., 50 F.3d 388 (7th Cir. 1995) (party must act promptly to determine judicial vs. arbitration forum)
PPG Indus., Inc. v. Webster Auto Parts, Inc., 128 F.3d 103 (2d Cir. 1997) (actions evidencing preference for litigation support waiver finding)
Hooper v. Advance Am., Cash Advance Ctrs. of Mo., Inc., 589 F.3d 917 (8th Cir. 2009) (bad-faith timing—seeking arbitration only after losing litigation advantage—supports waiver)
Kelly v. Golden, 352 F.3d 344 (8th Cir. 2003) (prejudice can include delay, expense, and duplication of effort when arbitration is belatedly invoked)
Stifel, Nicolaus & Co. v. Freeman, 924 F.2d 157 (8th Cir. 1991) (delay alone is not automatic prejudice but may combine with other factors to show prejudice)