Berkshire Hathaway Energy Seeks Arbitration in Gibson Lawsuit
Berkshire Hathaway Energy (BHE), the parent company of a real estate brokerage firm HomeServices of Americahas asked Judge Stephen R. Bough to reconsider an earlier ruling and for an order compelling arbitration in the Gibson copycat commission lawsuit.
In a document filed last week, BHE asked Bough to reconsider his order denying BHE’s request to strike and dismiss the class action allegations for failure to state a claim. The company is also asking the court for an order to compel arbitration.
BHE was named as a defendant in the lawsuit in March 2024.
In the filing, BHE said the court found in its previous order that the company “could not enforce arbitration and mediation agreements and class action waivers that absent putative class members may have signed because those agreements did not expressly identify BHE.”
The court made this ruling despite the fact that none of the named plaintiffs had sold real estate through a subsidiary of HomeServices of America. The ruling came about as United States District Court for the Western District of Missouri and the Eighth Circuit Court of Appeals had previously determined that the similar agreements at issue in the Sitzer/Burnett case were unenforceable.
A new agreement, executed after the district court and appellate court rulings, “identified HomeServices as the ‘ultimate parent’ and thus precluded BHE from enforcing it, even though the new agreements also expressly covered ‘affiliates’ .”
BHE claims that this order contains “significant and manifest errors of fact and law,” and that the court did not rule on BHE’s reasoning for the dismissal, such as “the absence of a plaintiff who can allege a single fact with regarding the conduct of BHE.”
BHE is also seeking an order from the court for mandatory arbitration. The defendant alleges that some of the plaintiffs likely entered into contracts with HomeServices subsidiaries or franchisees that contained mandatory arbitration provisions, meaning that their contracts expressly required that disputes be resolved through arbitration rather than in court.
In addition, BHE asserts that arbitration agreements are legally enforceable under the Federal Arbitration Act. BHE said it is invoking this law to request that all claims made in the lawsuit against it be resolved through arbitration. The company also said it believes it would be unfair to litigate a case related to contracts that contain arbitration provisions without allowing the company to enforce those provisions.
In the Sitzer/Burnett lawsuit, HomeServices ultimately filed a writ of certiorari Supreme Court on the Eighth Circuit’s ruling on its arbitration agreements. The Supreme Court ultimately rejected the company’s request.
