The Supreme Court of Louisiana refuses to send customers who were injured while playing at Sky Zone to arbitration, finding that the arbitration clause “is adhesionary and therefore unenforceable”.  Duhon v. Activelaf, LLC, __ So. 3d __, 2016 WL 6123820 (La. Oct. 19 2016); Alicea v. Activelaf, LLC, __ So. 3d __, 2016 6123859 (La. Oct. 19, 2016).  [My alternate title for this post is “I TOLD YOU SO, SKY ZONE.”  Every time I bring my children to the trampoline park for a birthday party, I tell those poor teenagers who are enforcing the rules that those contracts are likely not enforceable.  But, I cared more about the waiver of liability than the arbitration bit.]

The arbitration clause at issue, which is required to participate in activities, was clicked electronically.  It states “If there are any disputes regarding this agreement, I on behalf of myself and/or my child(ren) hereby waive any right I and/or my child(ren) may have to a trial and agree that such dispute shall be brought within one year of the date of this Agreement and will be determined by binding arbitration before one arbitrator to be administrated by JAMS…in the state of Louisiana.”  Furthermore, the agreement imposes $5,000 of liquidated damages for any customer who files a lawsuit.

Louisiana’s highest court held that agreement was unenforceable.  Applying its ruling regarding an arbitration clause in 2005, the court analyzed whether consent of the non-drafting party was calling into question by the existence of a standard contract between unequal bargaining parties, and in particular the “physical characteristics of the arbitration clause” and its mutuality.  Because Sky Zone’s arbitration language was “the only specific provision not relegated to a separate paragraph or set apart in some explicit way,” Sky Zone was not bound to arbitration by the clause, and patrons could be subject to a penalty of $5,000 for filing suit, the court found the arbitration clause “adhesionary and unenforceable.”  The court then dutifully noted that its “application of Louisiana contract law…in the instant case is consistent with [Section] 2 of the FAA”.

While the court states that this decision employs the same type of contract defense that is applicable to any contract — not just one with an arbitration clause — it does not appear to cite any cases outside the arbitration context.  That alone leads me to believe this case is susceptible to a GVR by SCOTUS under the DirecTV analysis.