Second Circuit Court of Appeals Finds Arbitration Provision Waiving Class Actions Unenforceable And Applies Stolt-Nielsen to Deny Class Arbitration

On July 12, 2010, the United States Court of Appeals for the Second Circuit held an arbitration provision barring class actions unenforceable because the provision was unconscionable under California law. Then, citing the recent decision in Stolt-Nielsen S.A. v. AnimalFeeds International Corp., 130 S. Ct. 1758 (2010), the Second Circuit affirmed the denial of the defendants’ motion to stay and compel arbitration because the parties had not agreed to class arbitration.

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