The Contract Is King: The U.S. Supreme Court’s Two Recent FAA Decisions

The U.S. Supreme Court addressed contract terms bearing on the availability of class arbitration in two opinions this term. The first, Oxford Health Plans LLC v. Sutter, confirms a district court’s limited power under the Federal Arbitration Act (the ‘‘FAA’’) to review an arbitrator’s determination that contract language authorizes class arbitration where the parties agreed the arbitrator would decide that question.

The second, American Express Co. v. Italian Colors Restaurant, requires district courts to enforce class arbitration waivers, even where the cost of individual arbitration is arguably prohibitive, and will likely result in non-enforcement of a federal statutory right.

Originally published in Class Action Litigation Report on 9/27/13.

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