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Arbitration › Car Dealerships

Arbitration is a widely-used method for settling disputes between parties. During arbitration, parties submit their dispute to an impartial third person or party, usually chosen by the parties. Typically, parties... more +
Arbitration is a widely-used method for settling disputes between parties. During arbitration, parties submit their dispute to an impartial third person or party, usually chosen by the parties. Typically, parties to arbitration agree in advance to be bound by the arbitrator's decision. Arbitration is an alternative to litigation, but it shares many of the familiar features of litigation. Namely, parties to arbitration hold hearings before neutral decision-makers, present evidence and argue the merits of their position. Parties often choose arbitration due to its perceived advantages over litigation. Those perceived advantages include greater efficiency and flexibility, and lower costs. less -
Miller Canfield

Michigan Court of Appeals Enforces Arbitration Provision in Auto Lease

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In a rare published decision, the Michigan Court of Appeals enforced a provision in an auto lease that allowed either party to demand arbitration, even though the dealer had assigned the lease to a finance company and no...more

Lathrop GPM

California Court of Appeals Denies Manufacturer’s Motion to Compel Arbitration Under Sales Contract to Which It Was Not a Party

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The California Court of Appeals for the Second District, creating a split of authority among California’s appellate courts, held that Ford Motor Co. did not have the right to enforce an arbitration provision in a sales...more

Fisher Phillips

Does Your Dealership Arbitrate? Recent Developments in Workplace Arbitration Agreements

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Employers – and, in particular, car dealerships – have relied on binding arbitration agreements to resolve employment disputes for decades. Arbitration offers a confidential setting in which businesses can efficiently...more

Hudson Cook, LLP

Check, Please!

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A typical car has around 30,000 parts precisely fitted together. Each part serves a unique role in the operation of the vehicle, and the result is a machine capable of traveling at speeds, in some cases, in the hundreds of...more

King & Spalding

Ninth Circuit Rejects Vehicle Manufacturer’s Attempt to Enforce Arbitration Clause in Dealership Purchase Agreement

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On January 12, 2022, the Ninth Circuit held that BMW North America, LLC (“BMW”) could not enforce an arbitration clause in a dealership purchase agreement because, under California law, BMW (1) was not a third-party...more

Fisher Phillips

Document, Document, Document: A Maryland Dealer Learns The Importance Of Regularly Updating Employment Forms

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There are three documents that dealerships should regularly review and update for compliance: the employee handbook, commission pay plans, and arbitration agreements, if applicable. As a Maryland dealership recently learned,...more

Hudson Cook, LLP

Dealership's Finance Manager Had Duty to Inform Buyer of Inconspicuous Arbitration Clause in Purchase Agreement Due to False...

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The buyer and a dealership signed a purchase agreement containing a dispute resolution clause ("DRC"). The DRC, in the middle of the purchase agreement, was the only provision in red ink, was in a smaller font and called for...more

Genova Burns LLC

Companies Beware: Pay Your Arbitration Fees Or Risk Losing Your Right to Arbitrate

Genova Burns LLC on

A decision by a judge of the U.S. District Court for the District of New Jersey on October 17, 2019, in Rachel A. Page v. GPB Cars 12, LLC d/b/a North Plainfield Nissan et al. (link to: opinion), stands as a critical warning...more

Littler

Easily “Shocked”? At Least for Wage Claims, California Supreme Court Lowers Standard for Unconscionability in Arbitration...

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In OTO, L.L.C. v. Kho, the California Supreme Court refused to enforce an employee’s arbitration agreement on the basis that it was unconscionable.  Unconscionability has long been a common-law defense to contract...more

Genova Burns LLC

N.J. Supreme Court Sends Auto Dealer Disputes to Arbitration

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On Wednesday, June 5, the New Jersey Supreme Court ruled in favor of enforcing arbitration agreements in car purchase agreements. The case, Goffe v. Foulke Mgmt. Corp., reverses the New Jersey Court’s recent trend of setting...more

Fisher Phillips

Is Your Dealership Taking Advantage Of Employment Arbitration?

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You may have recently heard something about arbitration agreements in the news, and you might be wondering whether your dealership should do anything about it. Some quick background: over the last decade, the use of...more

Carlton Fields

Third Circuit Refuses To Compel Arbitration In Light Of Alleged Fraudulent Inducement To Sign Arbitration Agreement

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The Third Circuit recently affirmed a lower court’s decision refusing car dealership defendants’ motion to compel arbitration pursuant to an arbitration agreement the plaintiffs were allegedly induced to sign. First, the...more

Seyfarth Shaw LLP

“Coercive” And “Disturbing” Arbitration Agreement Upheld Over Labor Commissioner’s Protest

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Seyfarth Synopsis: In OTO, LLC v. Kho, the California Labor Commissioner challenged a car dealership’s mandatory arbitration agreement. The agreement required employment disputes to be arbitrated under normal civil litigation...more

Foley & Lardner LLP

Commercial Contract Risk in 2017

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Coming off a record year in car sales, it’s expected that warranty and recall costs will continue to be on the rise. With that in mind, it’s vital that OEMs and suppliers have both their foreign and domestic contracts in...more

Carlton Fields

Failure To Pay Costs Did Not Materially Breach Arbitration Agreement In Light Of Legitimate Dispute As To The Forum

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A New Jersey appellate court affirmed an order dismissing a class action and compelling individual (non-class) arbitration. The underlying arbitration agreements provided that the defendant car dealership would pay all costs...more

Dorsey & Whitney LLP

It Is Now Easier To Draft Class Action Waivers and Arbitration Agreements

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Last week, the California Supreme Court provided additional guidance as to how to draft an enforceable arbitration agreement and how Courts should analyze whether mandatory arbitration provisions can be held unconscionable...more

Sheppard Mullin Richter & Hampton LLP

The California Supreme Court Holds Consumer Class Action Waivers In Arbitration Provisions Are Enforceable Under Federal Law

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On August 3, 2015, the California Supreme Court issued its long-awaited arbitration decision in Sanchez v. Valencia Holding Co., LLC, No. B228027. The Court held that the arbitration provision found in a standard form auto...more

Fenwick & West LLP

Termination Of Employee For Engaging In Outside Work While On FMLA/CFRA Upheld, But “Honest Belief” Standard Not Addressed

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In Richey v. AutoNation, Inc., the California Supreme Court held that an arbitrator committed no legal error when he determined that an employer lawfully terminated an employee for engaging in outside employment while on...more

Nossaman LLP

Did You Know…Court Confirms Employees on Medical Leave Must Still Comply With Existing Company Policies

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In Richey v. Autonation, Inc., Case No. S207536 (January 29, 2015), the California Supreme Court confirmed that an employee who is on medical leave does not have a greater right to reinstatement or to other benefits and...more

McNees Wallace & Nurick LLC

Auto Notes - December 2014

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In This Issue: - Retail Vehicle Installment Sale Contracts Now Regulated under PA Consumer Credit Code’s Motor Vehicle Sales Finance Provisions - Arbitration Clauses Referencing American Arbitration...more

McNees Wallace & Nurick LLC

Arbitration Clauses Referencing American Arbitration Association Require Wording Preapproval and Fees Paid

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Many dealer Buyer’s Orders and RISCs contain a provision indicating any customer dispute will be subject to arbitration. The thought behind including this disputed arbitration wording revolves around the belief that it is...more

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