Court Says Ex-Utility CEO Entitled to Arbitration

Posted By: Garnie Holmes Legislative/Regulatory,

FL CourtAn appeals court Tuesday said a former CEO of the Jacksonville municipal utility is entitled to go to arbitration in a legal battle over his firing. A three-judge panel of the 1st District Court of Appeal upheld a ruling last year by Circuit Judge Waddell Wallace that former JEA Chief Executive Officer Aaron Zahn’s contract required the battle to go to arbitration, rather than play out in a courtroom. Zahn was fired in January 2020 after an investigation involving a controversial proposal to sell the utility and privatize services. Zahn filed an arbitration case, contending that JEA owed money to him, according to Tuesday’s decision.

JEA then filed a lawsuit in circuit court alleging fraud and breach of fiduciary duty by Zahn. The ex-CEO argued that his arbitration case and the lawsuit should be resolved in arbitration. After Wallace agreed, JEA took the issue to the Tallahassee-based appeals court. Judge M. Kemmerly Thomas, in a seven-page decision joined by Judges Ross Bilbrey and Susan Kelsey, pointed to Zahn’s contract in finding that the lawsuit should go to arbitration. “As noted by the circuit court, JEA’s claims are based on duties which are provided for in the agreement,” Thomas wrote. “Zahn would not have been obligated by the duties allegedly violated without the agreement and the employment relationship it maintained. Thus, the agreement between the parties provides for duties not otherwise imposed by law, meaning that tort claims alleging a violation of those duties are related to the agreement and are covered by the arbitration provision.”

Article reposted with permission from The News Service of Florida.