A dispute involving the departure of the Rams from St. Louis could be headed to arbitration after all.
The Missouri Supreme Court on Jan. 29 ordered the Court of Appeals Eastern District to reconsider two rulings last year that allowed disputes to remain in circuit court despite claims from the defendants that they should be arbitrated. The high court didn’t say if or how the Eastern District should alter its initial rulings, but it said the court should consider the effects of two recent precedents involving the delegation of arbitration issues.
In one of the underlying cases, the St. Louis Regional Convention and Sports Complex Authority, the city of St. Louis and St. Louis County had sued the Rams and team owner Stan Kroenke, among other defendants, for breach of contract and other claims after the football team left St. Louis in 2016 for Los Angeles.
A St. Louis circuit judge declined Kroenke and the Rams’ request to send the matter to arbitration, based on mandatory-arbitration provisions in contracts signed when the team arrived in St. Louis in 1995. The Eastern District affirmed that ruling in August, holding that the plaintiffs’ claims are based on the NFL policy, not on the 1995 agreements.
In October, the Eastern District declined the defendants’ request to transfer the case to the Supreme Court and, in an unusual move, published an order stating why. Although the defendants argued that the court should consider whether the parties had delegated the power to decide arbitrability to the arbitrators, rather than to the courts. The Eastern District said it had found there was no applicable arbitration agreement.
“We fail to see how parties can delegate the power to decide arbitrability if there is no applicable arbitration provision in the first place,” the court said.
But in December, the Missouri Supreme Court ruled in Soars v. Easter Seals Midwest that the delegation provision of an employment-arbitration agreement could be considered to be valid even if the validity of the rest of the arbitration agreement was questionable. The court’s majority said the delegation clause constituted a separate mutual promise that the parties had made.
Then in January, the U.S. Supreme Court issued Henry Schein Inc. v. Archer and White Sales Inc. It similarly held that a delegation provision must be enforced “even if the court thinks that the argument that the arbitration agreement applies to a particular dispute is wholly groundless.”
The other remanded case was an employment discrimination suit from St. Louis County. The Eastern District had declined to compel arbitration in that case in September.
The cases are St. Louis Regional Convention and Sports Complex Authority et al. v. National Football League et al., SC97488, and Caldwell v. Unifirst Corporation, SC97538.