Court Opinion

ID: 9656676
Source: CourtListenerOpinion
Date Created: 2023-08-23 19:55:11.415112+00
Date Added: 2024-06-11T18:12:40.227821
License: Public Domain

Robert Brown, Justice, concurring. It is unclear to me whether the employment agreement executed between ADC (the Clinic) and Dr. Tahiri qualifies as a “contract evidencing a transaction involving commerce” such as to render the Federal Arbitration Act (FAA) applicable. 9 U.S.C. § 2 (1999). Nevertheless, I concur in the majority’s result that the FAA should not apply in this case. As the majority opinion correctly points out, the United States Supreme Court has interpreted the terms “involving commerce” broadly as to signify Congress’s intent to exercise its power under the Commerce Clause to its fullest. See Allied-Bruce Terminix Cos., Inc. v. Dobson, 513 U.S. 265 (1995). Moreover, there is no question but that the FAA covers more than “only persons or activities within the flow of interstate commerce.” Id. at 273. Indeed, for a contract to evidence a transaction involving commerce, it “need have only the slightest nexus with interstate commerce.” Crawford v. West Jersey Health Systems, 847 F. Supp. 1232, 1240 (1994). Furthermore, the FAA may apply to a transaction even if that transaction, taken alone, does not have a “ ‘specific effect on interstate commerce’ if in the aggregate the economic activity in question would represent ‘a general practice . . . subject to federal control.’ ” Citizens Bank v. Alafabco, Inc., 539 U.S. 52, 56-57 (2003) (quoting Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 236 (1948)). The majority opinion states that though the Clinic demonstrated that it had interstate ties, it failed to prove that it engaged in interstate business activities. The Clinic, however, presented evidence that cleaning and medical supplies were purchased from out-of-state vendors, that three out-of-state patients were treated in the Clinic, and that payments were received on behalf of patients from out-of-state insurance carriers. The Clinic, without question, could not treat patients without medical supplies and without receiving payments for the treatment. The purchase of out-of-state supplies, treatment of out-of-state patients, and receipt of payments from out-of-state insurance companies have been factors considered by other jurisdictions in deciding this issue. See Eddings v. Southern Orthopaedic & Musculoskeletal Associates, 605 S.E.2d 680 (N.C. App. 2004) (physician’s contract with employer involved interstate commerce where physician moved from one state to another to accept employment with employer, and employer treated patients who lived out-of-state, received payments from out-Of-state insurance carriers, and ordered goods and services from out-of-state vendors); Potts v. Baptist Health System, Inc., 853 So. 2d 194 (Ala. 2002) (nurse’s employment contract with hospital had a substantial effect on interstate commerce where hospital treated out-of-state patients, recruited physicians from out-of-state, and in doing so used telephones, U.S. mail, and air transportation, received a large amount of payments from out-of-state insurance carriers, and received supplies from out-of-state vendors, which nurse used daily in treating patients); In re Tenet Healthcare, LTD, 84 S.W.3d 760 (Tex. App. 2002) (employment contract between distribution clerk and hospital related to interstate commerce where the hospital treated out-of-state patients, ordered goods and services from out-of-state suppliers, and received payments from out-of-state insurance carriers as well as federal funds from Medicaid and Medicare, and employment contract specified that the FAA should govern the arbitration agreement); Crawford, supra (physician’s employment contract with hospital evidenced a transaction involving commerce where hospital treated patients from out-of-state, received payments from out-of-state insurance carriers, advertised regularly in out-of-state newspapers, and ordered goods from out-of-state vendors). Though the above-cited cases generally involved at least one tie to interstate commerce in addition to those present in the instant case, the United States Supreme Court has not required a minimum number of interstate ties, but rather, as already discussed, has interpreted the impact of the FAA broadly based on Congress’s power under the Commerce Clause. See Allied-Bruce Terminix, Cos., supra. Still, I could find no case applying the FAA simply based on the factors involved in the case at hand, and the United States Supreme Court has given no direction as to the standard to be applied in these cases, other than its reference to a “general practice,” which is subject to federal control. Citizens Bank v. Alafabco, Inc., 539 U.S. at 57. Rather, courts such as ours appear to be relegated to a case-by-case analysis, which amounts to a weighing of the factors in each individual case. What the Court has made clear is that Congress has not completely preempted this area with the FAA. Volt Info. Scis., Inc. v. Board of Trustees of Leland, 489 U.S. 468 (1989). The dilemma for me in this case is that Dr. Tahiri’s employment agreement helped facilitate the Clinic’s interstate ties. The Clinic is in the business of providing medical services to patients, and it cannot do this without physicians on staff. If it were not for its employed physicians, such as Dr. Tahiri, the Clinic would have no reason to purchase cleaning and medical supplies from out of state, would have absolutely no contact with foreign insurance carriers, and would not be treating out-of-state patients. If it were not for Dr. Tahiri’s, as well as other physicians’ employment agreements, the Clinic would not have been involved in interstate commerce at all. By the same token, I understand the majority’s concern over federal preemption. It is difficult to fathom a medical business of any size that would not buy pharmaceutical supplies from out of state or receive insurance payments from non-resident carriers. The fact that the Clinic provided services to three out-of-state patients is an important consideration but clearly the Clinic did not make a strong case for a general interstate practice based on this minimal number. In sum, I conclude that because of the circumstances in this case, a decision in favor of the FAA’s application would virtually equate to federal preemption. For that reason, I concur in the result. Imber, J., joins this concurrence.