Unconscionable Contracts

News & Analysis as of

Enforcing Your Arbitration Agreement Just Became a Great Deal Easier

Courts regularly praise private arbitration as a means of affording flexibility to the parties, reducing costs and time, and lessening the burden on the judicial system. In some cases though, arbitration clauses can present a...more

The First Rule of Bieber Parties: Can You Talk About Bieber Parties?

Although 2014 has thrust Justin Bieber into the legal spotlight for a variety of reasons, the most interesting Beiber-related legal question surrounds a party he threw at his California home in November, 2013. While the party...more

Tenth Circuit Holds FAA Preempts New Mexico Unconscionability Law

New Mexico law considers arbitration provisions that apply primarily to the claims that one party to the contract is likely to bring to be unconscionable and unenforceable. This law, the Tenth Circuit holds, is preempted by...more

Tenth Circuit Holds FAA Preempts New Mexico Law On Unenforceability Of Unconscionable Arbitration Provisions

On January 28, the U.S. Court of Appeals for the Tenth Circuit held that the Federal Arbitration Act (FAA) preempts New Mexico common law that a compulsory-arbitration provision in a contract may be unconscionable and...more

Which Arbitration Agreement Clauses Will Texas Courts Find Unconscionable?

In recent years, courts have consistently supported employers’ use of arbitration agreements in employment settings. During the last few terms, the Supreme Court of the United States has issued several decisions, such as...more

Choice of Law in Contractual Fraud Claims: New York vs. Delaware

The core elements of a prima facie case of contract-related fraud are generally consistent from state to state. But within the basic elements of this cause of action are distinctions between states that become particularly...more

How to Draft Enforceable Class Action and Other Employer-Friendly Waivers

Porreca v. The Rose Group was a class action lawsuit brought by Carly Porreca and Charles Walton, alleging that their employer, Applebee’s Neighborhood Grill and Bar, had violated the Fair Labor Standards Act. After Porreca...more

A Decision to Arbitrate in the Mountain State: The West Virginia Supreme Court of Appeals Rejects Retroactive Application of the...

The West Virginia Supreme Court of Appeals recently issued a decision addressing mandatory arbitration in connection with a residential mortgage loan that will impact litigants in the Mountain State and potentially influence...more

Court Holds Arbitration Agreement Requiring Employee to Pay Half of Arbitration Costs is Unconscionable

In Chavarria v. Ralphs Grocery Co., No. 11-56673, 2013 WL 5779332 (9th Cir. Oct. 28, 2013), the plaintiff, a former deli clerk, brought a class action against Ralphs for various alleged wage and hour violations of the...more

The California Supreme Court Curtails Concepcion’s Protection of Arbitration Agreements

In AT&T Mobility v. Concepcion, the United States Supreme Court analyzed whether a court could refuse to enforce an arbitration agreement because the terms are “unconscionable,” meaning that one party did not have meaningful...more

Clean-Up in Aisle 9: Ninth Circuit Finds Ralphs Grocery Company’s Arbitration Policy Unconscionable Under State Law Not Preempted...

As we have reported on several occasions, a string of United States Supreme Court cases over the past few years has strengthened the use and applicability of arbitration provisions in contracts. For example, in AT&T Mobility...more

Halloween Special: Scary Results If Employers Overreach In Arbitration Clauses

No haunted house can scare general counsel as much as an opinion invalidating their company’s arbitration clause and thereby allowing a class action to proceed. So, here is a Halloween tale for all to keep in mind....more

Did You Know…The Continuing Saga Of Arbitration Agreements & Unconscionability

In light of the United States Supreme Court decision in AT&T Mobility LLC v. Concepcion, the California Supreme Court recently reversed its own prior decision where it had held that an arbitration agreement that requires an...more

Through the Lens of Concepcion: California Supreme Court Revisits the Validity of Agreements Requiring Employee Waiver of Wage...

Almost one year after the U.S. Supreme Court summarily vacated the original 2011 Sonic-Calabasas opinion (Sonic I), the California Supreme Court issued its opinion on remand in Sonic-Calabasas A, Inc. v. Moreno (Sonic II)....more

The Ninth Circuit Rules Employer’s Arbitration Agreement Unenforceable Under California Law And Cautions Employers To Ensure...

Today, the Ninth Circuit, in Chavarria v. Ralphs Grocery Company (Case No. 11-56673), issued a decision affirming the denial of Ralphs Grocery Company’s motion to compel arbitration in an action by an employee asserting...more

The CA Supreme Court Issues a Confusing Opinion on the Question of Whether Employees can be forced to Arbitrate Unpaid Wage Claims...

We have written regularly regarding the enforceability of arbitration clauses contained in standard employment agreements. Understandably, most employers would love to avoid the uncertainty of appearing before a judge or jury...more

Is Your ADR Clause Enforceable?

A number of recent court decisions have addressed the enforceability of contract clauses that call for alternative dispute resolution procedures instead of traditional courtroom litigation. ...more

High Arbitration Fees Prove Costly to Defendant

A recent decision by the Arizona Court of Appeals underscores the importance of keeping consumer arbitration agreements consumer friendly. In Clark v. Renaissance West, LLC, the court affirmed the trial court’s denial of a...more

California Affirms Employer Arbitration Agreement, Providing Guidance

Providing further clarity for the enforceability of arbitration agreements in employment contracts, California’s First District Court of Appeal upheld a boilerplate arbitration clause in Peng v. First Republic Bank, No....more

Arbitration Agreement Dos and Don’ts

We recently posted a summary of Peng v. First Republic Bank, a case discussing the validity of an arbitration agreement contained in an employment contract. Peng is favorable for employers because the court there held that...more

Employer’s Arbitration Agreement Passes Muster

In Peng v. First Republic Bank, the California Court of Appeal for the First Appellate District rejected an employee’s contention that a company’s standard arbitration agreement was unconscionable. ...more

Lease Contests in the West Virginia Shale Plays

Over the past 18 months, landowners have filed independent actions in West Virginia state courts to invalidate oil and gas leases, some, if not all, of which have been removed to the federal court for the Northern District of...more

Federal Court Clarifies Unconscionable Conduct Law

In an important decision, the Full Federal Court of Australia has held that conduct alleged to be unconscionable is to be assessed against a normative standard of conscience, permeated with accepted and acceptable community...more

WVSCA Decision Strengthens Enforcement of Agreements to Arbitrate

On June 19, 2013, the West Virginia Supreme Court of Appeals (“the Court” or “WVSCA”) issued an important decision that bolsters the ability of financial institutions and other defendants to enforce arbitration agreements....more

Governor Christie Signs Bill Strengthening the Enforceability of Premarital Agreements

Governor Chris Christie has signed a bill that amends both N.J.S.A § 37:2-38 and N.J.S.A § 37:2-32 to strengthen the enforceability of premarital agreements....more

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