One of the most confounding doctrines in federal arbitration jurisprudence is the severability doctrine. The U.S. Supreme Court has held, since Prima Paint in 1967, that courts must enforce arbitration clauses within contracts, even if the entire contract is invalid or unenforceable. (Most non-arbitration geeks don’t believe me when I tell them that’s the law.)
severability
Class Rep Can Opt Out of Arbitration for All (And Other Recent State Court Anomalies)
By Liz Kramer on
Continuing last week’s theme of “States Gone Wild,” here are three more oddball summer decisions from state supreme courts. All of them find interesting paths around federal case law (IMHO).
Georgia Says Class Complaint Is Deemed Arbitration Opt Out For All Class Members
In Bickerstaff v. SunTrust Bank, 2016 WL 3693778 (Ga. July 8,…
January Arbitration Update: Effective Vindication, Class Arbitration, and FAA Preemption
By Liz Kramer on
Lots of interesting arbitration law has been made already in 2016, so here is a roundup from the first four weeks of the year. As a teaser, courts have breathed life into the effective vindication doctrine, found arbitrators cannot determine the availability of class actions, and found state laws not preempted. More surprisingly, state courts…
SCOTUS Selects Second Arbitration Case For 2015 Term
By Liz Kramer on
Posted in Validity of Arbitration Agreement
2015 has been a dry spell in arbitration decisions from the U.S. Supreme Court, but 2016 promises to be much more interesting. In addition to the California case being heard next week, SCOTUS just granted certiorari in another California-based arbitration decision. This one, MHN Government Services, Inc. v. Zaborowski, will review an unpublished 2-1 …
Illusoriness Gains In Popularity As An Arbitration Buster
By Liz Kramer on
Posted in Validity of Arbitration Agreement
You hear more about Lena Dunham than you expect, given the audience for “Girls”, right? (Read this article for more.) The same is true, or should be true, for the contract defense of illusoriness. After decades of disuse, it is popping up more and more often as a defense to the enforcement of arbitration clauses…
The Best New Argument For Compelling Arbitration = Rent-A-Center + the AAA Rules
By Liz Kramer on
To date, courts have largely limited the impact of the Rent-A-Center decision to arbitration agreements with explicit delegation clauses. But, what if Rent-A-Center applied to every single arbitration agreement that mentioned the AAA rules? That is a very real possibility, and one which would send almost all arbitrability disputes to arbitrators.
The Rent-A-Center decision used…
Severability Squared: Can Invalid Provisions Within an Arbitration Agreement Be Severed?
By Liz Kramer on
Posted in Validity of Arbitration Agreement
Do you remember the moment when you first encountered the concept of arbitrating arbitrability? Just the phrase is mind-bending! It took me a while to wrap my head around the idea that parties could separately agree to arbitrate the question of whether they really had to arbitrate. Well, here’s a similar mind-bender: how does state…
Twin Decisions From Florida Supreme Court Throw One-Two Punch at Nursing-Home Arbitration Agreements
By Liz Kramer on
Posted in Validity of Arbitration Agreement
The Supreme Court of Florida has moxie. It issued two new decisions the day before Thanksgiving which go out of their way to sidestep and distinguish the U.S. Supreme Court’s decision in Rent-A-Center, West v. Jackson, 130 S. Ct. 2772 (2010), in order to find that nursing home residents may not be compelled to…
Has The Parade of Predicted Horribles From Rent-A-Center Come To Pass?
By Liz Kramer on
Posted in Validity of Arbitration Agreement
Just over a year has passed since the U.S. Supreme Court applied the severability doctrine in Rent-A-Center, West Inc. v. Jackson, 130 S. Ct. 2772 (2010), in such a way that Justice Stevens and three others dissented, raising the specter of “infinite layers of severability” and a parade of arbitrability horribles. A review of…