Employers Should Consider Waivers Of Class Claims In Light Of Supreme Court Decision


In AT&T Mobility LLC v. Concepcion, a 5-4 Supreme Court struck down this week California’s policy of prohibiting waivers of class claims in consumer arbitration agreements. The Court held that California’s so-called “Discover Bank rule” conflicted with the Federal Arbitration Act. The AT&T decision is yet another statement of the strong federal policy favoring arbitration of disputes and may provide support to employers who want to include class waivers in employment agreements.

The FAA was enacted in 1925 in response to a widespread judicial hostility to arbitration agreements. (Sound familiar?) The FAA demands that arbitration agreements be provided the same discretion and deference as other contracts. In other words, if the arbitration agreement at issue – often, but not always, executed as part of a consumer transaction agreement – contains a dispute resolution procedure, that procedure should usually be followed. The only limitations, according to several Supreme Court decisions – are defenses typically used in all other contract disputes – fraud, duress or unconscionability.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

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.

© Constangy, Brooks, Smith & Prophete, LLP | Attorney Advertising

Written by:


Constangy, Brooks, Smith & Prophete, LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.