Legal Alert: Supreme Court Holds that Parties Who Have not Agreed to Class Arbitration Cannot be Required to Submit to Class Arbitration

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On April 27, the United States Supreme Court published its decision in Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp., No. 08-1198, an antitrust case that could have far-reaching implications with respect to class arbitration. (A copy of the Court's slip opinion is available here.) In a 5–3 decision, the Court held that parties who had never agreed on the issue of whether to allow class arbitration under the arbitration agreement between them – and whose arbitration agreement made no mention whatsoever of class arbitration – could not be required to submit to class arbitration under the agreement. In so holding, the Court ruled that "a party may not be compelled under the [Federal Arbitration Act] to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so."

Please see full Alert below for more information.

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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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