“Our Courts, Our Fight” is a blog series documenting the harmful impact of President Trump’s judges on Americans’ rights and liberties and the need for the Senate to confirm President Biden’s federal court nominees to help counteract these effects. Supreme and appellate court cases in the series can be found by issue and by judge at this link.
Trump Judge Robert Luck wrote an opinion denying two former Florida donors to the Church of Scientology the right to appeal a ruling against them by a Church arbitration panel in a case concerning alleged fraud by a church affiliate. The Eleventh Circuit panel’s 2-1 decision in Garcia v. Church of Scientology Flag Service Organization, Inc. upheld the district court’s decision compelling the donors to submit to binding arbitration by the Church, even though the Church had never before in its history conducted an arbitration case and made up the procedures as it went along.
The donors, Luis and Maria Garcia, were former members of the Church and had previously donated large sums of money. After leaving the Church, the Garcias sued an arm of the Church, Flag Service, for over $400,000, alleging Flag Service fraudulently solicited their donations. Flag Service asked the District Court to compel the Garcias to submit to arbitration by the Church, given that the Garcias had signed several agreements containing arbitration provisions while members of the Church. The District Court agreed, subjecting the Garcias to mandatory arbitration.
There was one major issue with this arrangement—the Church had never conducted an arbitration before. The arbitration agreement the Garcias signed contained very little detail, beyond the procedures for picking arbitrators and the requirement that the arbitration be conducted “in accordance with Scientology principles.” The Church admitted to the Garcias that because of this vague language, it would decide rules “at the appropriate time during the arbitration.”
Unsurprisingly, the arbitration did not go smoothly. Representatives of the Church prevented arbitrators from seeing most material critical of the Church and refused to allow the Garcias’ attorney or chosen witnesses to attend. On the last day of the arbitration, one arbitrator erupted in an outburst, claiming the Garcias were working to “destroy the church” and had been “fed…lies”
The arbitration panel awarded the Garcias a little over $18,000, far short of their original claim. The Garcias asked the district court to vacate this ruling, which the court denied. The Garcias then appealed, claiming the Church’s lack of arbitration procedures violated Florida law, which requires that arbitration rules be “definite enough so that the parties have some idea as to what matters are to be arbitrated and provide some procedure by which arbitration is to be effected.”
Trump judge Luck’s decision upheld the district court’s ruling, claiming that the arbitration agreement complied with the law. The panel said that the agreement gave the Garcias “some idea” of the procedures the arbitration panel would use, meaning the agreement was “sufficiently definite” to satisfy Florida law. The court therefore refused to allow the Garcias to challenge the arbitration ruling.
Judge Robin Rosenbaum strongly dissented, explaining that “you can’t make up the rules as you go along.” Rosenbaum claimed that the Church had done precisely that by failing to outline essentially all procedures and rules governing the arbitration beforehand. She noted that the Church’s lack of arbitration procedures directly contradicted the contract the Garcias signed, which referred to the Church’s “binding arbitration procedures” several times. Because the Church failed to delineate these procedures as promised, it broke its contractual agreement with the Garcias as well as Florida law, Rosenbaum stated, and the arbitration proceeding was “arbitrary and unfair.” She maintained that the lower court’s order requiring arbitration should have been vacated so that the Garcias could get a fair trial on their claims from the court.
Trump Judge Luck’s ruling subjected the Garcias to the ad-hoc decisions of a hastily convened arbitration panel that failed to extend them even the most basic legal protections. This case is yet another example of Trump judges deferring to corporate arbitration efforts and reflects the importance, as part of our fight for our courts, of confirming fair-minded judges who will help ensure individuals are never stripped of their legal rights simply because they signed a piece of paper.
Note: Andrew Kliewer is a law student fellow at People For the American Way.