Labor & Employment Law Daily Wrap Up, PROCEDURE—4th Cir.: Appellate court lacked jurisdiction to review lower court’s order granting stay and directing arbitration, (Apr 13, 2026)

By Ronald Miller, J.D.

The appeals court may look past the caption of the renewed motion when it suspects that the motion has been mis-captioned in an attempt to take advantage of Section 16(a).

The Fourth Circuit determined that it lacked appellate jurisdiction of an interlocutory appeal brought by employees seeking an order compelling their employer to pay arbitration initiation fees after a district court stayed the action pending arbitration. The appeals court held that the challenged order effectively maintained a stay and directed arbitration to proceed. Because Section 16(b) of the FAA bars interlocutory appeals from orders staying litigation or directing arbitration, the appeals court could not review the denial of the employees’ renewed motion (Geneva Enterprises, LLC v. Chavez, No. 25-1469 (4th Cir. Apr. 10, 2026)).

“Mass arbitration.” In February 2024, a group of employees initiated a “mass arbitration” against the employer before the American Arbitration Association (AAA). They alleged wage-related claims under the Virginia Wage Payment Act, and a claim under the FLSA. The employer maintained that four of the employees had not signed agreements to arbitrate and that the other employees failed to comply with conditions precedent to arbitrating. When the employees commenced their arbitrations, the employer refused to pay arbitration initiation fees to the AAA.

State court action. In response, the employer filed a suit in state court in March 2024 against the employees, seeking an injunction against the arbitrations under Virginia law and the FAA, along with a declaratory judgment regarding the scope of the arbitration agreements invoked by the employees. The employees removed the action to federal court.

Shortly after removing this case to federal court, the employees also filed a petition under Section 4 of the FAA, seeking to compel arbitration and to stay the federal court proceedings pending the arbitration before the AAA. For its part, the employer sought a federal court injunction of the arbitration itself. In a June 2024 order, the district court denied the employer’s request to “enjoin the arbitration initiated by” the employees, and for a preliminary injunction, and granted the employees’ request to impose a stay of “this action... pending resolution of the parties’ claims in arbitration.” The court also declined to adjudicate the employees’ motion to compel arbitration.

Arbitration initiation fees. Consequently, the parties returned to the AAA for further proceedings. But upon returning to the AAA, the employer continued to refuse payment of the arbitration initiation fees, and the employees became dissatisfied with the AAA’s approach to that issue. Specifically, the AAA stated that if the employer was unwilling to pay the necessary fees to initiate the arbitrations, then the employees could advance the fees and then seek recovery of the advance from an arbitrator.

Not willing to accept the AAA’s proposal, the employees returned to the district court in March 2025 to seek redress. The employees filed a combined motion to lift the stay and to compel arbitration (renewed motion), seeking entry of an order directing the employer to pay the arbitration initiation fees to the AAA. In a March 2025 order, the court denied the relief sought.

Appellate review. On appeal, the employees challenged only the district court’s March 2025 Order. Specifically, the employees maintained that they were entitled to a court order directing the employer to pay the arbitration initiation fees to the AAA. For its part, the employer contended that the request was legally improper under the FAA, and it maintained that the appeals court lacked subject-matter jurisdiction over this action.

Appellate jurisdiction. As an initial matter, the appeals court had to determine whether it possessed appellate jurisdiction under Section 16 of the FAA. Although the parties were prepared to concede that the court had appellate jurisdiction, the court had a special obligation to satisfy itself of its appellate jurisdiction.

The employees—who bear the burden of proving the existence of appellate jurisdiction—maintained that the court’s jurisdiction in this interlocutory appeal was supplied by Section 16(a) of the FAA. The employer maintained that appellate jurisdiction was lacking in this situation because Section 16(b) of the FAA is clear that “an appeal may not be taken from an interlocutory order... granting a stay of any action” referred to arbitration, or otherwise “directing arbitration to proceed.”

The Fourth Circuit observed that its appellate jurisdiction is generally limited to appeals from “final decisions of the district courts.” And ordinarily, a district court’s decisions are not final until there is a judgment on the merits. However, in the proper circumstances a court of appeals is entitled to assess an appeal in an “interlocutory” posture. One such instance arises under Section 16 of the FAA. The FAA allows a court of appeals to consider and resolve an interlocutory appeal from a court order refusing to direct arbitration to proceed. Conversely, Section 16(b) of the FAA specifies that “an [interlocutory] appeal may not be taken from an interlocutory order (1) granting a stay of any action ... ; (2) directing arbitration to proceed... ; (3) compelling arbitration... ; or (4) refusing to enjoin an arbitration that is subject to this title.”

District court stay. Here, the court agreed with the employer that it lacked appellate jurisdiction. In the court’s view, the district court’s March 2025 Order—which clearly refused to lift the previously-imposed stay of the district court proceedings pending the outcome of arbitration before the AAA—was, like the non-appealed June 2024 Order, an order “directing arbitration to proceed” before the AAA. Moreover, the March 2025 Order was unmistakably an order “granting a stay of [the] action” pending arbitration. The appeals court plainly lacked appellate jurisdiction, pursuant to 9 U.S.C. § 16(b)(1) and (2).

The appeals court declined to exercise appellate jurisdiction in this situation merely because the March 2025 Order resulted in a denial of the renewed motion. Although the appeals court generally does not look beyond the caption of a denied motion when determining its jurisdiction under the FAA, it was permitted to look past the caption of such a motion when it suspects “that the motion has been mis-captioned in an attempt to take advantage of § 16(a). And that is what occurred here.”

In the renewed motion, the employees did not ask the district court solely to compel arbitration. They also asked the court to order the employer to pay the arbitration initiation fees to the AAA. Because the employees sought far more relief than their narrowly-captioned renewed motion purported to seek—including relief not provided for by the FAA—they are “no longer proceeding exclusively under the FAA and have forfeited their right to interlocutory review under § 16(a).”

The March 2025 Order was an extension of the June 2024 Order, and it directed the parties to arbitrate before the AAA, noted the appeals court. In these circumstances, the appeals court necessarily lacked appellate jurisdiction.

Accordingly, the appeals court dismissed the interlocutory appeal for lack of appellate jurisdiction.

The case is No. 25-1469.

Judge: King, R.

Attorneys: Robert Wesley Thayer Tucci (Zipin, Amster & Greenberg) for Aaron Chavez, Alex Guevara, Ana Flores, Anthony Cipriano, Antonio Rivera, Bruce Wilson, Carlos Romero, Chelsea Montes, Christian Isopescu, Dogan Gunessever, Edward Martin, Erodita Guevara, Eun Shin, Hector Orozco, Hugo Cajina, James Osborn, Jeffrey Shade, Kai Reed, Michael Kentes, Michael Hook, Patrick White, Paul Lyons, Robert Dorman, Roberto Huaccha, Roy Braxton, Roy Hippert, Jr., Sean McLain, Thomas Grant, Tommy Tran, William Smith and William Bonilla. Leslie Paul Machado (O’Hagan Meyer) for Geneva Enterprises, LLC, and AV Automotive, LLC.

Companies: Geneva Enterprises, LLC; AV Automotive, LLC

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