Sivanandi v. NCL Limited
Sivanandi, plaintiff, was employed by NCL, Ltd ("NCL") as an assistant line cook aboard its vessel. While he working he slipped and fell on two separate occasions. As a result of the two falls, plaintiff had to have knee surgery and presently walks with a cane and a limp while experiencing continued knee pain. He filed his complain in state court but the defendant's removed the case due to the U.S. Convention on Recognition and Enforcement of Arbitral Awards ("Convention") and its enabling legislation.
Once the claim was removed, the defendant moved to dismiss the claim and to compel arbitration pursuant to an arbitration provision in the employment contract. The language of this provision requires the plaintiff to submit his claims to arbitration proceedings in India or the Bahamas and to apply Bahamian law.
Sivanandi opposes the arbitration arguing that it is against public policy to mandate Bahamian law apply and to do so would preclude him from pursuing his Jones Act claim pursuant to U.S. law. Further, he seeks to remand the case on three grounds: 1) a Jones Act claim is not removable, 2) the arbitration provision is an impermissible forum selection clause, and 3) the arbitration provision constitutes an impermissible prospective waiver of his statutory right to pursue a Jones Act Claim.Can a Jones Act claim filed in a state court be removed? Is the arbitration provision enforceable?
The Court first address the issue of removing a Jones Act claim. Typically, the Jones Act allows a plaintiff the absolute right to forum selection. Here, however, the Court has a conflict between the Jones Act plaintiff's forum selection right and the defendant's right to enforce an arbitration agreement in federal court. According to the Convention, where the subject matter of an action in state court relates to an arbitration agreement the defendant may remove the case at any time prior to trial. As such, the Court held, as it has several other times that the removal of a Jones Act negligence claim to enforce an arbitration agreement is proper pursuant to Convention.
Next, the Court addressed the enforceability of the arbitration agreement; which is the ultimate factor in determining whether the plaintiff is entitled to remand. Under the convention, an arbitration agreement is unenforceable if it goes against public policy.
Here, Sivanandi argues that the current agreement goes against public policy because it prohibits him from pursuing his statutory remedy under the Jones Act. In support of his argument, Sivanandi relies on a recent Eleventh Circuit decision, Thomas v. Carnival, 573 F.3d 1113 (11th Cir. 2009), holding that an arbitration agreement goes against public policy when a choice-of-law and choice-of-forum clause work in tandem to operate as a waiver to a seaman's statutory right of recovery. The District Court found the present case identical to the Thomas decision.
NCL argued that this case is factually different from the Thomas decision because that case dealt with the Seaman's Wage Act and not the Jones Act, like the issue presently before the court. The District Court, however, rejected this argument because it found no basis to limit the Thomas court's decision and that a holistic reading of Thomas indicates that the Eleventh Circuit's reasoning applies with equal force to Jones Act claims.
Thus, due to the nature that Jones Act claims are not generally removable and that the basis for removal was improper, the District Court denied NCL's motion to dismiss and granted Sivanandi's motion to remand.An agreement to arbitrate a dispute goes against public policy when the choice-of-law and choice-of forum clause operate as a waiver to an employee's statutory right of recovery.
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