Legal Alert: Supreme Court Holds that Arbitrator, not Court, Should Decide Issue of Unconscionability

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The U.S. Supreme Court has just issued a decision holding that under the Federal Arbitration Act (FAA) an arbitrator, not a court, should decide whether an arbitration agreement is unconscionable when the parties have delegated the determination of that issue to the arbitrator. See Rent-A-Center West v. Jackson (June 21, 2010). The Court's decision overturns that of the Ninth Circuit, which held that the court has exclusive jurisdiction to determine the issue of unconscionability, even though the parties' arbitration agreement gave the arbitrator that authority.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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