Legal Alert: Second Circuit Addresses Class-Action Waivers in Arbitration Agreements after Supreme Court's Stolt-Nielsen Decision

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This article is a continuation of Ford & Harrison LLP's focus on the use of arbitration agreements to protect employers from collective/class-action exposure under the Fair Labor Standards Act.

In March 8, 2011, the Second Circuit issued In re American Express Merchants' Litigation, ("Amex") regarding the enforceability of a class-action waiver, specifically in light of the Supreme Court's Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp., 130 S. Ct. 1758 (2010). Previously, in Stolt-Nielsen, the Supreme Court reversed the Second Circuit on the issue of whether silence in an arbitration agreement would allow parties to arbitrate on a class basis. Although the Court in Amex ultimately held that the class-action waiver was not enforceable, the basis of the Court's decision likely would not apply to a class-action waiver in the context of the Fair Labor Standards Act. (A copy of the decision is available by clicking here or on the Second Circuit's web site at: http://www.ca2.uscourts.gov/decisions.)

Please see full alert below for more information.

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