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Arbitration Unconscionable Contracts

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 -
Lewitt Hackman

Franchisor 101: Charging Toward Arbitration

Lewitt Hackman on

A California federal court granted a motion to compel arbitration by retail franchisor Batteries Plus and its two executives, and dismissed a franchisee’s action alleging violations of the California Franchise Investment Law,...more

Kilpatrick

California Supreme Court outlines severance standards for unconscionable contract provisions in arbitration case

Kilpatrick on

Issues surrounding unconscionability and severance are commonplace in motions to compel arbitration, especially in California. Under California Civil Code section 1670.5, a court has three options when presented with an...more

Ervin Cohen & Jessup LLP

Severing Unconscionable Terms in Employment Arbitration Agreements

In August 2000, the California Supreme Court handed down a landmark ruling that changed the face of employment arbitration agreements going forward. That case, known as Armendariz v. Foundation Health Psychcare Services,...more

Troutman Pepper

EDVA Judge Invalidates Arbitration Clause in Online Terms and Conditions

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In a recent decision, EDVA Judge Rossie Alston invalidated the arbitration clause in the terms and conditions for online sales through the Lowe’s Home Centers website on the grounds that the terms and conditions were illusory...more

Ervin Cohen & Jessup LLP

Overbroad Employment Arbitration Agreements Will Not Be Enforced in California

Arbitration agreements, at their core, are contracts. As with any contract, there must be “mutuality” or, more colloquially, a “meeting of the minds” on what the contract is intended to encompass. For this reason, employment...more

Kilpatrick

Ninth Circuit decides two pro-arbitration cases

Kilpatrick on

The Ninth Circuit concluded that arbitration agreements were enforceable in two opinions that addressed three significant arbitration issues: (1) the standards applicable to the mutual assent analysis in online transactions;...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

California Appellate Decision Raises New Considerations for Arbitration Agreements

A California appellate court recently denied a motion to compel arbitration, finding the agreement unconscionable in part because it (1) applied to all claims rather than just those arising from employment, (2) was unlimited...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

California Supreme Court Says Severing Unconscionable Terms From Arbitration Agreements Is a Question of Fairness

On July 15, 2024, the Supreme Court of California issued a decision that could provide courts in the state with significant discretion to refuse to enforce employment arbitration agreements even if only one term is determined...more

CDF Labor Law LLP

CA Supreme Court: No Three-Strikes Rule For Enforcement of Arbitration Agreements

CDF Labor Law LLP on

In a recent decision, the California Supreme Court held that courts cannot refuse to enforce arbitration agreements simply by finding that three or more provisions are unconscionable. Rather, courts must use a three-prong...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

California Appeals Court Finds Employer’s Arbitration Agreement With Cost-Sharing and Out-of-State Law Provisions Unconscionable

In a recent ruling, a California appeals court found an arbitration agreement with an eyewear store employee that was presented on a take-it-or-leave-it basis required an arbitrator to apply the laws of another state,...more

Lathrop GPM

California Federal Court Grants Retail Franchisor’s Motion to Compel Arbitration and Dismisses Action

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A federal court in California recently granted a motion brought by a franchisor and two of its employees to compel arbitration and dismiss an action alleging violations of the California Franchise Investment Law, breach of...more

Troutman Pepper

Ninth Circuit Reverses District Court, Sending Opportunity Financial Lawsuit to Arbitration

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The U.S. Court of Appeals for the Ninth Circuit recently reversed a district court’s ruling, which had denied a motion to compel arbitration of Opportunity Financial (OppFi) on the basis that the arbitration clause was...more

Stikeman Elliott LLP

Meal Delivery Service’s Mandatory Arbitration Clause for Couriers Unconscionable: Manitoba Court of Appeal

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The Manitoba Court of Appeal (the “Court”) in Pokornik v. SkipTheDishes Restaurant Services Inc., 2024 MBCA 3, recently upheld a lower court decision dismissing a large online meal delivery service’s motion to stay a class...more

Fox Rothschild LLP

Be Careful with Your Demands When Converting Existing Licensees to Franchisees!

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A recent case decided by the Ohio Court of Appeals reminds new franchisors to tread carefully when converting existing licensees to future franchisees. In the case of Okolish v. Town Money Saver, Inc., a coupon clipper...more

Carlton Fields

Ninth Circuit Reverses Order Denying Motion to Compel Arbitration, Concluding “Delegation Provision” Is Enforceable

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Noting the court was deciding, as a matter of first impression, “what a party must do to specifically challenge a delegation provision and what a court may consider when evaluating this challenge,” the Ninth Circuit Court of...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

California Court of Appeal Rules Arbitration Agreement Is Unenforceable

A California appellate court recently denied enforcement of an arbitration agreement because (1) it contained provisions the court found problematic, and (2) the employer presented the agreement to the employee for electronic...more

Carlton Fields

Eleventh Circuit Affirms Order Compelling Arbitration of Discrimination Claims, Rejects Argument That Arbitration Agreement Was...

Carlton Fields on

In Payne v. Savannah College of Art and Design Inc., the Eleventh Circuit Court of Appeals affirmed a district court order denying a motion to compel arbitration of plaintiff Isaac Payne’s discrimination-based claims. The...more

Fisher Phillips

SCOTUS Ruling Protects Top 3 Benefits of Arbitration: Key Takeaways for Employers

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Employers seeking to move workplace claims from the courthouse to arbitration received some good news Friday from the U.S. Supreme Court. If a trial court denies a party’s request to compel arbitration, the court must pause...more

Fisher Phillips

SCOTUS Predictions: Divided Court Will Reach Close Decision in Critical Arbitration Case

Fisher Phillips on

Employers that face lawsuits from employees often seek to move such claims from the courthouse to arbitration. But what happens if the trial court refuses to compel arbitration and the employer appeals the decision? Should...more

Haight Brown & Bonesteel LLP

Court of Appeal Finds Arbitration Agreement Presented as a Stand-alone Document was Not Unconscionable

The Second District Court of Appeal issued an opinion in Rocha v. U-Haul Co. of California, et al. (Cal. Ct. App., Feb. 2, 2023, No. B322599) 2023 WL 1462594, addressing questions of procedural and substantive...more

Ballard Spahr LLP

Verizon appeal on mass arbitration issues backed by prominent industry groups

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Earlier this week, we wrote about Verizon’s appeal to the Ninth Circuit from a district court ruling that the bellwether provision in its arbitration clause was unconscionable. Both the U.S. Chamber of Commerce and the...more

Carlton Fields

Eleventh Circuit Enforces Employee Arbitration Agreement, Concluding That Agreement Was Not Unconscionable

Carlton Fields on

In Lambert v. Signature Healthcare LLC, the Eleventh Circuit Court of Appeals reversed the district court’s denial of the defendants-appellants’ motion to dismiss and to compel arbitration under the FAA, holding that the...more

Carlton Fields

Delaware Federal Court Confirms Arbitration Award, Holds Arbitrator Did Not Exceed Authority in Finding Unambiguous Contract...

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QAD Inc. petitioned the Delaware federal court to confirm an arbitration award it obtained against Block & Company Inc. Block cross-moved to vacate the award. The arbitrator awarded QAD more than $740,000 in connection with a...more

Manatt, Phelps & Phillips, LLP

California Court Finds Arbitration Agreement Unconscionable

An employer’s arbitration agreement was both procedurally and substantively unconscionable, a California appellate panel determined, affirming a trial court’s denial of an employer’s motion to compel arbitration....more

Fox Rothschild LLP

Applicability of Statute of Repose Is An Issue Of Procedural Arbitrability To Be Decided By Arbitrator

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In Rummel Klepper & Kahl, LLP v. Delaware River & Bay Authority, C.A. No. 2020-0458-PAF (Del. Ch. Jan. 3, 2022), the Court of Chancery considered Defendant’s motion to dismiss and to compel arbitration. The Plaintiff and...more

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