Full Opinion

Fourth Court of Appeals San Antonio, Texas MEMORANDUM OPINION No. 04-25-00388-CV UNITEDHEALTH GROUP INC., Appellant v. Melissa PEARSON, Appellee From the 166th Judicial District Court, Bexar County, Texas Trial Court No. 2021CI02352 Honorable Nicole Garza, Judge Presiding Opinion by: Irene Rios, Justice Sitting: Irene Rios, Justice Adrian A. Spears II, Justice H. Todd McCray, Justice Delivered and Filed: October 28, 2026 REVERSED AND REMANDED In this interlocutory appeal, UnitedHealth Group, Inc. (“UHG”) appeals the trial court’s order denying its motion to compel arbitration. In two issues, which we construe as one, UHG argues the trial court erred when it determined UHG waived its right to arbitration with its former employee, appellee Melissa Pearson, and denied its motion to compel arbitration. The trial court concluded UHG was required to initiate arbitration for Pearson’s employment discrimination claim and found UHG’s failure to initiate arbitration was inconsistent with its right to arbitration. Under 04-25-00388-CV supreme court precedent and basic principles of contract construction, we hold Pearson was required to initiate arbitration as the party seeking affirmative relief. Because UHG did not actively participate in litigation, and had no obligation to initiate arbitration, we hold it did not waive its right to arbitration. Accordingly, we reverse the trial court’s order denying UHG’s motion to compel arbitration and remand the cause to the trial court to enter an order compelling arbitration. BACKGROUND On February 4, 2021, Pearson filed suit alleging her employer, UHG, discriminated against her based on her age when it demoted her and later terminated her employment. UHG contacted Pearson’s counsel on March 8, 2021, and notified him that Pearson’s claim is subject to a binding arbitration agreement. UHG’s counsel attached a copy of the arbitration agreement to the email to Pearson’s counsel. After discussions between the parties, Pearson agreed to a motion to stay the proceedings so the parties could arbitrate Pearson’s claim, and in April 2021, the parties filed a joint motion to stay proceedings pending arbitration. However, the trial court never ruled on the motion and the case remained dormant for over three years until July 2024, when Pearson’s counsel emailed UHG stating he “wanted to circle back to our case (it’s been some time) and pick up where we left off regarding arbitration.” The email also asked UHG to “advise” on “next steps.” UHG never responded to the email, and Pearson followed up with another email on November 20, 2024, stating: “Following up on my attempts to move forward with this arbitration.” On December 17, 2024, UHG responded stating it believed limitations to arbitrate Pearson’s claim had expired during the multi-year dormancy. After informal settlement negotiations failed, Pearson propounded discovery on UHG and proposed a docket control order for the litigation. UHG then filed a motion to dismiss the lawsuit -2- 04-25-00388-CV for want of prosecution or, in the alternative, a motion to compel arbitration. The court denied the motion on July 16, 2025, and UHG appeals the trial court’s order denying its motion to compel arbitration. Standard of Review We review the denial of a motion to compel arbitration for an abuse of discretion. Henry v. Cash Biz, LP, 551 S.W.3d 111, 115 (Tex. 2018). We defer to the trial court factual determinations supported by the evidence and review legal determinations de novo. MH Consultants, Inc. v. Martinez, No. 04-25-00230-CV, 2025 WL 3713674, *1 (Tex. App.—San Antonio Dec. 23, 2025, no pet.) (mem. op.) (citing Henry, 551 S.W.3d at 115). “As a threshold matter, the party moving to compel arbitration must establish the existence of a valid and enforceable arbitration agreement between the parties.” Metso Mins., Inc. v. Maverick Aggregates, Inc., No. 04-15-00532-CV, 2016 WL 3022060, at *2 (Tex. App.—San Antonio May 25, 2016, pet. denied) (mem. op.). After the moving party establishes a valid and enforceable arbitration agreement, the trial court must then determine whether the claims presented fall within the scope of that agreement. Id. “In determining ‘whether a party’s claims fall within an arbitration agreement’s scope, we focus on the petition’s factual allegations rather than the legal causes of action asserted.’” City of San Antonio v. Cortes, 468 S.W.3d 580, 583 (Tex. App.—San Antonio 2015, pet. denied) (alterations omitted) (quoting In re FirstMerit Bank, 52 S.W.3d 749, 754 (Tex. 2001) (orig. proceeding)). “If the arbitration agreement includes the claims at issue and the opposing party cannot prove any defense preventing arbitration, ‘the trial court has no discretion but to compel arbitration and stay its own proceedings.’” Cortes, 468 S.W.3d at 583 (quoting FirstMerit Bank, 52 S.W.3d at 754). -3- 04-25-00388-CV We also review de novo whether a party has waived the right to arbitration by substantially invoking the judicial process. MH Consultants, 2025 WL 3713674 at *1 (citing Perry Homes v. Cull, 258 S.W.3d 580, 589 (Tex. 2008)). There is a strong presumption against waiver of arbitration. Perry Homes, 258 S.W.3d at 590. We look at the totality of the circumstances to determine waiver on a “case-by-case basis.” Id. DISCUSSION In the trial court and in this court, the parties do not dispute there is a binding arbitration agreement between them, nor do they dispute that Pearson’s claim falls within the scope of the arbitration agreement. However, in the trial court, Pearson argued UHG waived its right to arbitration because it never initiated arbitration. WAIVER A party asserting implied waiver as a defense to arbitration has the burden to prove that the other party has substantially invoked the judicial process, which is conduct inconsistent with a claimed right to compel arbitration. 1 G.T. Leach Builders, LLC v. Sapphire V.P., LP, 458 S.W.3d 502, 511–12 (Tex. 2015). “Due to the strong presumption against waiver of arbitration, this hurdle is a high one.” Perry Homes, 258 S.W.3d at 590. “Whether a party has substantially invoked the 1 In Morgan v. Sundance, Inc., 596 U.S. 411 (2022), the United States Supreme Court held that federal courts could no longer require a party to show it was prejudiced when invoking the waiver defense to arbitration. Morgan v. Sundance, Inc., 596 U.S. 411, 416–17 (2022). There is a split among the Texas intermediate courts of appeal on whether, in state court, the party opposing arbitration must establish a showing of prejudice to invoke the waiver defense to arbitration. See MH Consultants, Inc. v. Martinez, No. 04-25-00230-CV, 2025 WL 3713674, at *4 (Tex. App.—San Antonio Dec. 23, 2025, no pet.) (mem. op.). Neither the Texas Supreme Court nor this court have decided the applicability of the prejudice prong to cases filed in state court and governed by the FAA. See id. Because we determine UHG has not substantially invoked the judicial process and therefore has not waived its right to arbitration, we need not consider whether Pearson is required to establish prejudice in light of Morgan. See Eades v. Doe 1, No. 04-22-00472-CV, 2023 WL 9007839, at *4 n.1 (Tex. App.—San Antonio Dec. 29, 2023, no pet.) (mem. op.) (declining to address Morgan’s effect on the prejudice prong when appellants did not substantially invoke the judicial process). -4- 04-25-00388-CV judicial process depends on the totality of the circumstances.” G.T. Leach Builders, 458 S.W.3d at 512. In this analysis, we consider the following factors: • whether the movant was plaintiff (who chose to file in court) or defendant (who merely responded); • how long the party moving to compel arbitration waited to do so; • the reasons for the movant’s delay; • whether and when the movant knew of the arbitration agreement during the period of delay; • how much discovery the movant conducted before moving to compel arbitration, and whether that discovery related to the merits; • whether the movant requested the court to dispose of claims on the merits; • whether the movant asserted affirmative claims for relief in court; • the extent of the movant’s engagement in pretrial matters related to the merits (as opposed to matters related to arbitrability or jurisdiction); • the amount of time and expense the parties have committed to the litigation; • whether the discovery conducted would be unavailable or useful in arbitration; • whether activity in court would be duplicated in arbitration; and • when the case was to be tried. Perry Homes, 258 S.W.3d at 591; G.T. Leach Builders, 458 S.W.3d at 512. “Implying waiver from a party’s actions is appropriate only if the facts demonstrate that the party seeking to enforce arbitration intended to waive its arbitration right.” San Antonio Eye Ctr., P.A. v. Vision Assocs. of S. Tex. P.A., No. 04-22-00078-CV, 2022 WL 3908843, at *5 (Tex. App.—San Antonio Aug. 31, 2022, pet. denied) (mem. op.). Applying the factors here, it is undisputed that Pearson filed the underlying suit and UHG merely responded. UHG did not file any counterclaims and immediately notified Pearson that her claims were subject to arbitration. UHG did not propound any discovery and did not move for affirmative claims of relief or disposition on the merits. The case remained dormant, save a few vacation notices filed by Pearson’s counsel, for the three years the case was pending in the trial -5- 04-25-00388-CV court, and there was no trial date set when UHG moved to compel arbitration. Thus, UHG’s three- year delay to file the motion to compel arbitration was the only basis on which the trial court could have found UHG waived its right to arbitration. The trial court concluded UHG “waived any right to compel arbitration by acting inconsistently with that right, engaging in prolonged delay, and failing to initiate arbitration or obtain a court order compelling [arbitration], as required by Texas and federal law.” Shortly after Pearson filed suit, UHG notified Pearson her claim was subject to an arbitration agreement. The parties agreed to arbitrate Pearson’s claim and filed a joint motion to abate the underlying litigation while they arbitrated Pearson’s claims. However, neither party initiated arbitration. First, we note that “while delay may be a factor both in terms of whether the movant has substantially invoked the judicial process and whether the nonmovant has suffered prejudice, mere delay is not ordinarily enough even if it is substantial.” G.T. Leach Builders, 458 S.W.3d at 515. “Waiver can be implied from a party’s unequivocal conduct, but not by inaction.” Id. Second, UHG argues its delay to compel arbitration should be excused because it was not necessary to compel arbitration when the parties agreed to arbitrate Pearson’s claim. Pearson contends UHG should not be allowed to rely on this excuse for the delay because UHG had the burden to initiate arbitration of Pearson’s claim and its failure to do so during the three-year- dormancy period was an act inconsistent with its right to arbitrate Pearson’s claim. UHG argues Pearson, as the party seeking affirmative relief, had the burden to initiate arbitration. UHG contends that because it did not have the burden or obligation to initiate arbitration, it did not act inconsistently with its right to arbitrate Pearson’s claim. -6- 04-25-00388-CV On appeal, UHG challenges the trial court’s conclusion that UHG was required to initiate arbitration under the arbitration agreement. UHG argues that it was Pearson’s burden to initiate arbitration, and thus it could not have waived its right to arbitration because the delay was caused by Pearson’s failure to initiate arbitration. Thus, the resolution of which party was responsible for the delay, and thereby whether UHG acted inconsistently with its right to arbitration, depends on which party had the burden to initiate arbitration. It appears Pearson believes UHG was required to initiate arbitration because it was the party who sought to enforce the arbitration agreement. We disagree. “It is antithetical to the interests of such a party to itself initiate a proceeding, be it a court suit or arbitration, that would expose it to the risk of liability.” In re Bruce Terminix Co., 988 S.W.2d 702, 705 (Tex. 1998) (orig. proceeding). “If no arbitration clause existed, the plaintiff would have had the task and expense of initiating suit; [the plaintiff] could not have required the defendant to sue itself.” Id. (alterations omitted). “The rule is the same with arbitration substituted for suit: the party seeking relief is the one who must go forward with arbitration proceedings.” Id. “[A]bsent a contrary agreement, a party against whom a claim is asserted does not waive its right to arbitrate by failing to initiate arbitration of that claim.” Id. at 706. Under the supreme court’s holding in Terminix, the party who is seeking affirmative relief is responsible for initiating arbitration. See id. The trial court concluded Terminix was inapplicable to the case at bar because the parties did not obtain a ruling on their joint motion to abate the suit pending arbitration. 2 We do not see how the failure to obtain a ruling on a joint motion to abate the suit pending arbitration is dispositive and distinguishes this case in a material 2 In Terminix, the trial court made an oral ruling early in the case granting Bruce Terminix Company’s motion to compel arbitration; however, Terminix never obtained a written order granting the motion to compel arbitration. In re Bruce Terminix Co., 988 S.W.2d 702, 703 (Tex. 1998) (orig. proceeding). It appears the trial court relied on the oral ruling and motion to compel arbitration in Terminix to distinguish that case from the case at bar. -7- 04-25-00388-CV way from the holding in Terminix. The joint motion to abate the trial court proceedings pending arbitration simply requested the court to suspend proceedings, presumably so the suit would not move forward or be dismissed for want of prosecution while the parties arbitrated Pearson’s claim. It did not ask for any other relief and was not a motion to compel arbitration. In fact, it would be unnecessary for UHG to move to compel arbitration when Pearson had already agreed to arbitrate her claims. To the extent the trial court distinguished Terminix based on the timing of the motion to compel arbitration, we have already noted delay alone is usually insufficient to constitute waiver of a party’s right to arbitration. See G.T. Leach Builders, 458 S.W.3d at 515. The general rule from Terminix is that when a party pursues a claim, it is responsible for initiating the proceedings whether those proceedings are in court or in arbitration, unless the parties contracted otherwise. See Terminix, 988 S.W.2d at 705–06. Here, Pearson was the party seeking affirmative relief on her employment discrimination claims and therefore was the party burdened with initiating arbitration unless the arbitration agreement placed that burden on UHG. We next look to the arbitration agreement to determine whether the parties contracted around the general rule to require UHG to initiate arbitration against itself on Pearson’s behalf for her claim of employment discrimination. In construing a contract, our primary concern is to ascertain the parties’ intentions, as expressed in the contract itself. Italian Cowboy Partners, Ltd. v. Prudential Ins. Co of Am., 341 S.W.3d 323, 333 (Tex. 2011). To ascertain the parties’ intentions, we examine the entire agreement to harmonize and give effect to all its provisions so that none will be rendered meaningless. MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647, 652 (Tex. 1999). We “presume parties intend what the words of their contract say and interpret contract language according to its plain, ordinary, and generally accepted meaning unless the instrument directs -8- 04-25-00388-CV otherwise.” URI, Inc. v. Kleberg County, 543 S.W.3d 755, 764 (Tex. 2018) (internal quotation marks and footnote omitted). The arbitration agreement contractually binds the parties to arbitration for “all claims and controversies, past, present, or future, that [Pearson] may have against [UHG] or [UHG] may have against [Pearson], which arise out of or relate to [Pearson’s] employment, application for employment, and/or termination of employment.” The agreement further states: “Employees are encouraged to exhaust the [internal dispute resolution (“IDR”)] process before initiating arbitration. If an employment-related dispute is not resolved through the IDR process and the dispute is based on a legal claim not expressly excluded from this Policy, any party to the dispute may initiate the arbitration process.” This provision indicates it is Pearson’s burden to initiate arbitration on her own claims; however, UHG may initiate arbitration if IDR is unsuccessful. Here, there is no indication Pearson engaged in the IDR process, thereby permitting UHG to initiate arbitration on Pearson’s claim. We do not read this provision as shifting the burden to UHG to initiate arbitration against itself for Pearson’s claims. Section D.1. of the arbitration agreement provides how each party must initiate arbitration for their respective claims. It states: a. Arbitration Initiated by Employee - UnitedHealth Group shall pay 100 percent in excess of the first twenty-five dollars ($25) of the required [American Arbitration Association (“AAA”)] administrative fee. An employee may initiate arbitration by submitting, within the applicable statute of limitations period, a written demand for arbitration which states a claim under applicable federal, state, or local law to Corporate Legal Department, UnitedHealth Group, [address], 3 with a check for $25 payable to “UnitedHealth Group.” The demand shall set forth the dispute, including the alleged act or omission at issue, the name, address and telephone number of the employee, and the names of all persons allegedly involved in the act or omission. Within 30 business days of receiving such demand UnitedHealth Group shall file the demand with the appropriate office of the AAA, 3 The arbitration agreement contained the address where Pearson needed to submit her written demand; however, we omit the address in our opinion. -9- 04-25-00388-CV together with the applicable administrative fee as provided in the AAA’s fee schedule. b. Arbitration Initiated by UnitedHealth Group - UnitedHealth Group may initiate arbitration by submitting, within the applicable statute of limitations period, a written demand for arbitration which states a claim under applicable federal, state, or local law to the employee’s last home address of record via certified mail or overnight mail. The demand shall set forth the dispute, including the alleged act or omission at issue, the name, address and telephone number of the employee, and the names of all persons allegedly involved in the act or omission. Within 30 business days of submitting the demand to the employee, UnitedHealth Group shall file the demand with the appropriate office of the AAA, together with the applicable administrative fee as provided in the AAA’s fee schedule. When arbitration is initiated by UnitedHealth Group, the company is responsible for 100% of all AAA administrative fees. Contrary to Pearson’s assertion, this provision does not place the burden on UHG to initiate arbitration on Pearson’s claim for employment discrimination. It is clear from the context of the entire arbitration agreement that either party can initiate arbitration. For example, the arbitration agreement allows UHG to pursue claims for “unfair competition and violation of trade secrets” as well as “claims arising out of or related to post-termination defamation or job references.” Whereas Pearson can pursue claims for, among other things, wages, discrimination, or harassment. Section D.1. simply provides the processes required for each party to initiate arbitration on their respective claims. If Pearson has a claim for employment discrimination, she must follow the process in section D.1.a., titled “Arbitration Initiated by Employee[.]” If, however, for example, UHG wants to initiate arbitration for violations of trade secrets, it must follow the process in section D.1.b., titled “Arbitration Initiated by UnitedHealth Group[.]” These provisions cannot be reasonably read as shifting the burden to UHG to initiate arbitration on behalf of Pearson for her claim of employment discrimination, especially considering there was no indication or evidence that Pearson initiated the IDR process. - 10 - 04-25-00388-CV In Terminix, the supreme court relied on the arbitration agreement’s incorporation of the AAA’s Commercial Arbitration Rules when concluding the parties did not contract around the general rule that the claimant is responsible for initiating arbitration. See Terminix, 988 S.W.2d at 706. Specifically, the Terminix court determined the AAA’s Commercial Arbitration Rules “define ‘the initiating party’ as the ‘claimant’ and provide that the claimant shall initiate arbitration through a ‘demand’ containing []a statement setting forth ‘the nature of the dispute, amount involved, . . . and the remedy sought.’” Id. (alterations omitted) (quoting AM. ARBITRATION ASS’N, COMMERCIAL ARBITRATION RULES Rule 6(a) (1996)). The arbitration agreement in the case at bar provides that arbitration “shall be in accordance with the then-current Employment Arbitration Rules of the AAA.” The language in the commercial arbitration rules relied on by the Terminix court are materially indistinguishable from the language in the employment arbitration rules. Here, the current Employment Arbitration Rules also define the “initiating party” as the “claimant” and provide that the claimant shall initiate arbitration through a demand containing a “statement setting forth the nature of the claim, including the relief sought and the amount involved,” “a brief explanation of the dispute and specification of the amount of money in dispute,” and “a statement of the relief sought.” AM. ARBITRATION ASS’N, EMPLOYMENT/WORKPLACE ARBITRATION RULES Rule 4(a)(i), (iv) (2025). Admittedly, the arbitration agreement modifies this process slightly because it requires the demand and a $25 fee be sent to UHG, who will then submit the case to the AAA. However, “the duty to define the nature of the dispute and the remedy as provided by [the AAA rules] naturally and logically falls on the claimant.” Terminix, 988 S.W.2d at 706 (internal quotation marks omitted). “It would be anomalous to require the party against whom relief is sought to present its opponent’s - 11 - 04-25-00388-CV case” in the arbitration demand. Id. “This scenario is not reasonable and clearly not the design of the rules.” 4 Id. Because Pearson was the party seeking affirmative relief for her employment discrimination claim, she was required to initiate arbitration by delivering a demand for arbitration and a $25 fee to UHG. Pearson argues the $25 fee was “at most a minor procedural irregularity that did not forfeit substantive rights[,]” and all the information necessary for a demand was in Pearson’s petition. It appears Pearson contends her failure to send the demand and pay the $25 fee to UHG should be excused. However, the arbitration agreement clearly states these conditions must be met before UHG is obligated to file the demand with the AAA. Until Pearson met these conditions, UHG was under no obligation to submit Pearson’s claim to the AAA. Nothing in the record indicates Pearson ever sent the demand for arbitration or the $25 fee to UHG as required by the arbitration agreement. 5 We conclude UHG did not waive its right to arbitration. UHG had a valid excuse for waiting to compel arbitration because Pearson agreed to halt her lawsuit and pursue arbitration shortly after suit was filed. It was Pearson’s obligation to initiate arbitration, and she failed to file the demand for arbitration and pay the $25 fee required to initiate arbitration. Thus, any delay cannot be reasonably attributable to UHG. And none of the other waiver factors weigh in favor of a finding that UHG waived its right to arbitration. Thus, the trial court erred when it concluded UHG waived its right to arbitration, and, absent waiver, the trial court erred when it denied UHG’s motion to compel arbitration. In re Whataburger Rests. LLC, 645 S.W.3d 188, 194 (Tex. 2022) 4 Moreover, the current employment arbitration rules, which were effective before the trial court denied the motion to compel arbitration, state: “In the event the parties dispute which party or parties should be the claimant(s) and which party or parties should be the respondent(s), the AAA may make an initial determination, subject to a final determination by the arbitrator.” AM. ARBITRATION ASS’N, EMPLOYMENT/WORKPLACE ARBITRATION RULES Rule 4(b)(ii) (2025). 5 To the contrary, there are numerous assertions in the record, including Pearson’s own affidavit, that Pearson never sent the demand for arbitration or the $25 fee to UHG. - 12 - 04-25-00388-CV (orig. proceeding) (“A trial court that refuses to compel arbitration under a valid and enforceable arbitration agreement has clearly abused its discretion.”). Accordingly, we sustain UHG’s issues on appeal. CONCLUSION Because we conclude the trial court erred when it denied the motion to compel arbitration, we reverse the trial court’s order denying UHG’s motion to compel arbitration and remand the cause to the trial court to enter an order compelling arbitration. Irene Rios, Justice - 13 -