Nafta Traders v. Quinn

Margaret Quinn (plaintiff) was a vice president of Nafta Traders, Inc. (Nafta) (defendant), a redistributor of athletic apparel. Nafta’s employee handbook included an arbitration section stating that any termination disputes would be arbitrated. Nafta eventually laid off Quinn as part of a reduction in force. Quinn filed suit in state court for sex discrimination. Nafta moved to compel arbitration under the Federal Arbitration Act (FAA). The court granted the motion. The arbitrator issued an award for Quinn. Quinn moved for the court to confirm the award under the Texas General Arbitration Act (TAA). Nafta moved to vacate the award under the FAA, TAA, and provisions of the handbook’s arbitration section. The relevant provisions stated that an arbitrator did not have the authority to render a decision containing a reversible error of state or federal law or to apply a remedy not expressly provided by state or federal law. Nafta argued that these two provisions constituted an agreement to expand the scope of judicial review provided by the TAA and FAA. Quinn asserted that the TAA and FAA did not allow for parties to agree to expand the grounds for vacating awards. The trial court affirmed the arbitration award, and Nafta appealed. The appellate court affirmed the trial court’s decision, finding that parties could not contractually agree to expand judicial review of an arbitration award under the TAA or the FAA. Nafta appealed to the Texas Supreme Court.