After deciding four arbitration cases during the previous term, the United States Supreme Court decided only one case regarding arbitration during its 2010 term (commencing in October 2010 and extending until June 2011)—but it is a case with a major implication for both arbitration and litigation practice. In addition, the Second Circuit has decided a case that takes a perhaps unexpected approach to the Supreme Court’s decision last year in Stolt-Nielsen S.A. v. Animalfeeds International Corp. (“Stolt-Nielsen”). Both decisions are discussed below.
A. AT&T v. Conception
The Supreme Court’s sole arbitration decision this year was rendered in AT&T v. Conception, which reversed on Federal Arbitration Act preemption grounds a Ninth Circuit decision upholding California’s rule that class action waivers in certain consumer adhesion contacts were invalid as applied to contracts containing arbitration clauses. AT&T builds on the Supreme Court’s decision the previous term in Stolt-Nielsen holding that an arbitration agreement that was silent on class arbitration could not be interpreted to authorize class arbitration to create an environment in which consumer class actions may be very difficult to bring in arbitration...
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