Legal Alert: Supreme Court Finds FAA Preempts State Law Prohibiting Class Action Waivers in Arbitration Agreements

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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.

On April 27, 2011, the United States Supreme Court issued AT&T Mobility LLC v. Concepcion addressing the enforceability of an arbitration agreement in a consumer contract that prohibited classwide arbitration. In a 5-4 decision, the Court held that the agreement was enforceable, reversing the Ninth Circuit's determination that the agreement prohibiting class claims was unconscionable under California law. The Concepcion decision is a strong indication that an arbitration agreement prohibiting classwide arbitration in the employment context would be enforceable. (For a link to the Concepcion slip opinion, click here).

Please see full alert below for more information.

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