Spirit Airlines, Inc. v. Steven Maizes
899 F.3d 1230
11th Cir.2018Background
- Members of Spirit Airlines’ $9 Fare Club filed a class arbitration claim alleging breaches of the club membership agreement.
- Spirit sued in federal court seeking a declaratory judgment that the arbitration clause forbids class arbitration and sought a preliminary injunction to halt the arbitration.
- The membership agreement incorporated the American Arbitration Association (AAA) rules and stated disputes would be resolved by arbitration in Florida law.
- The District Court dismissed Spirit’s suit for lack of jurisdiction, concluding the AAA rules (including Supplementary Rule 3 for Class Arbitration) clearly and unmistakably delegate the question of class arbitrability to the arbitrator.
- Spirit appealed, arguing incorporation of AAA rules alone is insufficient to delegate class‑arbitrability, Florida law creates ambiguity, and the court erred by excluding parol evidence of Spirit’s intent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Who decides whether the arbitration agreement permits class arbitration? | Class reps: incorporation of AAA rules (including Supplementary Rule 3) shows arbitrator decides. | Spirit: adopting AAA rules alone is not clear and unmistakable; courts should decide class arbitrability. | Court: Arbitrator decides; incorporation of AAA rules is clear and unmistakable evidence of delegation. |
| Does Supplementary Rule 3’s instruction (that the arbitrator should not consider the Supplementary Rules when construing the clause) negate delegation? | Class reps: it only prevents using the Rule as evidence on whether class arbitration is permitted, not on who decides. | Spirit: the paragraph implies courts, not arbitrators, should decide delegation. | Court: Paragraph addresses clause construction, not delegation; it does not negate clear delegation. |
| Does choice of Florida law create ambiguity and reserve arbitrability to courts under Florida statute? | Class reps: Florida law governs substantive rights, AAA rules govern procedures—no ambiguity. | Spirit: choice of Florida law may incorporate Florida Arbitration Code, which reserves arbitrability questions to courts. | Court: No ambiguity; harmonize provisions to give Florida law substantive scope and AAA rules procedural scope. |
| Was parol evidence (vice president testimony) admissible to show intent about delegation? | Class reps: contract is unambiguous; extrinsic evidence not allowed. | Spirit: intended to show ambiguity and Spirit’s intent to limit arbitration to individual disputes. | Court: Agreement unambiguous on delegation; parol evidence properly excluded. |
Key Cases Cited
- Terminix Int’l Co. v. Palmer Ranch Ltd. P’ship, 432 F.3d 1327 (11th Cir. 2005) (incorporation of AAA rules is clear delegation to arbitrator)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (presumption that courts decide arbitrability absent clear and unmistakable evidence delegating to arbitrator)
- Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662 (2010) (distinguishes bilateral and class arbitration; addresses whether agreements permit class arbitration)
- Oxford Health Plans LLC v. Sutter, 569 U.S. 564 (2013) (procedural notes on arbitrability and delegation issues)