Saturday, September 15, 2007
ARBITRATION QUIXTAR PANACEA
As you are likely aware, Quixtar is a big fan of arbitration. A read of Quixtar / Amway's dreaded Rules of Conduct includes the use of arbitrators in case of disputes. Quixtar stated the following on its Alticor Media Blog in regards to a courts decision ordering both parties into arbitration, "Arbitration was fine with us. The facts remain on our side." There seems to be two absolutes in the Quixtar / Amway world, overpriced products and the love of arbitration.So why would Quixtar prefer this method of dispute resolution to that of due process administered by the State and Federal Court systems? The obvious answer is to keep their activities private or secret. They would love to get away with saying what they say, and not have it come back to bite them in the pants later on. They don't want to go on the record in court or better yet in the court of public opinion. In the light of day Quixtar is vulnerable to their own words and beliefs. Let us not forget one galvanizing statement made in the Kent County proceedings, the calling of IBO's "Property of Quixtar.' These are these the things that will destroy their company in the eyes of third party citizens. One other polarizing comment made by Quixtar legal during those same proceedings concerned a written statement by Billy Florence. In the statement Florence said, and I am paraphrasing, "I can not in the presence of my creator continue to go forward with Quixtar." Please forgive me Billy if this is not close enough... but I think you all get the point. Billy made reference to his creator aka GOD to many of us. The Quixtar attorney jumped all over his opportunity to say that Mr. Florence had violated some rule about bringing God into it. I haven't taken the time to look that one up but I find it interesting that a rule like that even exists, especially with this particular company. But irregardless of whether the rule exists or not, how smart was it for Quixtar legal to jump all over that one?As you can see arbitration is a place where Quixtar can hide all its short comings. All their gaffes, and screw ups behind closed doors. They can be as rotten as they want to be and no one will know. As I stated in an earlier post concerning the Grand Rapids case:
Quixtar's last desire is to argue in the the light of day. Instead you hear words like, sealed, and confidential. Make no mistake about it, the 15 martyrs have turned on the lights, and as they do, the cockroaches are running for cover.
Yes Quixtar / Amway is a company desirous of secret, closed door sessions, and sealed final reports. As reports came in from Grand Rapids I couldn't help but laugh at all I heard. Much of it surrounded Quixtar and the IBOAI's demand that Woodward and Brady return any confidential documents to them. Of course none of these secrets were really secrets at all. One supposed secret was that Doug Devos stated that the business was an internal consumption model. That certainly was not a secret to the IBO's I know. There were no secret formulas, in fact there were no secrets at all. Just a bunch of hot air.There are still other things to consider. In this article in FINDLAW
Arbitration v. Litigation In Court: Which To Choose If You Have The Choice
By Edward C. Mengel of White and Williams LLP
Your expected witnesses may dictate the choice of a court forum. Courts have the power of subpoena as well as the power to enforce their subpoenas if they are not obeyed (usually by issuing a bench warrant for the arrest of the subpoenaed person). Arbitrators generally have the power to issue subpoenas but probably do not have much authority to back up the subpoenas if they are not obeyed. Thus, if you need crucial witnesses outside of your control in order to present your side of the story, you may wish to choose a court forum where you can compel their attendance (provided that they are located within the territory where the court's subpoenas may issue).
Another consideration is that in a court forum most issues can be determined by a jury at the request of either party. One must consider, in choosing a forum, whether it would be beneficial for the case to be decided by a jury. If your case is one where you feel strongly that a jury would not be beneficial to your case, you definitely want to stick to the arbitration forum where a jury is out of the question.
Given the very sensitive nature of this case I could see again why Quixtar would like to hide in the shroud of arbitration. There is very likely going to be subpoenaed documents and or persons in this case. Will Quixtar comply with an arbitrator who has no authority to enforce the request?Yet another issue is that the use of an arbitrator denies Woodward the right to a jury trial. This is a very important point. This is something specifically requested in the Woodward suit against Quixtar. With a jury you are getting a group of people to come to decision instead of one person who may have his or her own biases. A jury should be preferable to both sides. My biggest guess is Quixtar / Amway's reason for choosing arbitration over a jury is that they would actually have to put their marketing research up for all to see. What I mean is Amway and its incredible name recognition may not be such a good thing for them.Let us not forget what Woodward and company are asking for. Not some huge dollar figure so common in today's litigious society. No, not that, Woodward doesn't ask for ANY money. Just a choice for IBO's to stay or leave the Quixtar world, and to not be bound by a non compete clause that many of those who hoped to be covered by this suit never signed to begin with. Remember this was added without anyone knowing about 3 years ago. So as we continue down this road remember, one of the parties looks to have his day in court for all the world to see and to seek truth in the daylight from a jury of his peers. The other side looks to hide in the shadows of arbitration and dance among words like confidential, and secret and sealed.
Posted by The IBO Rebellion at 4:29 AM 1 comments
Labels: ARBITRATION QUIXTAR PANACEA
CALIFORNIA CASE UPDATE
Here is the promised post regarding the California case. I will do my best to report what I understand. As you are aware it is rather difficult getting information as everyone is tight lipped.The first item is the class action suit filed by Woodward and company v Quixtar. This action has been filed in a United States Federal Court. A class action suit is simply a lawsuit brought by one party on behalf of a group of individuals all having the same grievance. In this case the class Woodward's legal team is referring to are the IBO's doing business with Quixtar. Before this can happen a class action must be certified by the judge. These decisions are governed by the Federal Rules of Civil Procedure of (FRCP). Rule 23 covers Class Actions; subsection (c) covers certification and it says:
(c) Determining by Order Whether to Certify a Class Action; Appointing Class Counsel; Notice and Membership in Class; Judgment; Multiple Classes and Subclasses.(1) (A) When a person sues or is sued as a representative of a class, the court must Â— at an early practicable time Â— determine by order whether to certify the action as a class action..(B) An order certifying a class action must define the class and the class claims, issues, or defenses, and must appoint class counsel under Rule 23(g).(C) An order under Rule 23(c)(1) may be altered or amended before final judgment.(2) (A) For any class certified under Rule 23(b)(1) or (2), the court may direct appropriate notice to the class.(B) For any class certified under Rule 23(b)(3), the court must direct to class members the best notice practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort. The notice must concisely and clearly state in plain, easily understood language:* the nature of the action,* the definition of the class certified,* the class claims, issues, or defenses,* that a class member may enter an appearance through counsel if the member so desires,* that the court will exclude from the class any member who requests exclusion, stating when and how members may elect to be excluded, and* the binding effect of a class judgment on class members under Rule 23(c)(3).(3) The judgment in an action maintained as a class action under subdivision (b)(1) or (b)(2), whether or not favorable to the class, shall include and describe those whom the court finds to be members of the class. The judgment in an action maintained as a class action under subdivision (b)(3), whether or not favorable to the class, shall include and specify or describe those to whom the notice provided in subdivision (c)(2) was directed, and who have not requested exclusion, and whom the court finds to be members of the class.(4) When appropriate (A) an action may be brought or maintained as a class action with respect to particular issues, or (B) a class may be divided into subclasses and each subclass treated as a class, and the provisions of this rule shall then be construed and applied accordingly.The next issue, and certainly related to the issue of class, is whether or not the court has jurisdiction over the defendant, in this case Quixtar. There are many issues here but in this case one item is that Quixtar does in fact conduct business in California. I am not a lawyer and I am sure there are many variables here. I can't speak for Quixtar but one would guess since Woodward filed this lawsuit in California he thinks this would be a good place to hold it. Quixtar would probably prefer Grand Rapids, MI but who knows.There is also the possibility of arbitration. This is a binding decision of an arbitrator and is not considered a court. The Construction Sciences Resource Foundation describes arbitration as the following:
Arbitration, however, is basically Litigation Light, and like some of the "light" products for dietary consumption, arbitration too often does not live up to its touting. The primary benefit advanced in support of arbitration is also its chief drawback: it is not litigation.While most arbitrators as well as most judges genuinely seek to do justice, I believe judges are more likely to decide a case on its merits, separated from prejudice, sympathy, personal orientation, bias, and other extraneous considerations,
It is obvious that Woodward would like to keep the matter in court as opposed to arbitration. Quixtar, if unable to head back to Grand Rapids, would prefer arbitration over the courts.I may be missing something but I don't think so. These were the issues before the court on Wednesday September 12th. On this day the judge heard some arguments, made no decision, and requested a legal brief from Quixtar. The judge then scheduled a hearing for Wednesday September 19th. We will have to wait and see how far things get on this coming Wednesday. I hope I have provided some accurate and helpful information. Stay tuned.
Posted by The IBO Rebellion at 2:54 AM 3 comments