February 19, 2015 Articles

After Concepcion, Is Your "New" Arbitration Agreement Still Enforceable?

Federal courts have announced that not all provisions will be.

by E. Colin Thompson and Amy Reagan

In AT&T Mobility LLC v. Concepcion, the U.S. Supreme Court upheld the validity of an arbitration agreement waiving consumers’ right to bring contractual claims as a class, instead requiring such claims to be resolved through arbitration. The Court did so by holding that the Federal Arbitration Act preempted a state rule providing that class action waivers in arbitration agreements were unconscionable and, therefore, unenforceable. 131 S. Ct. 1740, 1753 (2011). Since Concepcion became the law of the land, the Supreme Court and other federal courts have announced, through holdings and dicta, that not all arbitration and class waiver provisions will be enforceable. Their decisions provide further guidance and warnings for drafters of arbitration and class waiver provisions.

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