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Arbitration › Unconscionable Contracts › Employment Contract

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 -
Kilpatrick

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

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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

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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

Ervin Cohen & Jessup LLP

Overbroad Employment Arbitration Agreements Will Not Be Enforced in California

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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

CDF Labor Law LLP

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

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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

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

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

Carlton Fields

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

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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

Haight Brown & Bonesteel LLP

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

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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

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

SDNY Compels Arbitration Based on Severability Doctrine, Finds Fee-Shifting Clause Not Unconscionable

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The Southern District of New York granted a motion to compel arbitration of an employment dispute between the petitioners and the respondent. The petitioners also filed a motion to dismiss or stay a concurrent proceeding that...more

Lewitt Hackman

Can Your Company’s Arbitration Agreement Survive an Unconscionability Inquiry?

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Concluding that TWC Dealer Group, Inc.’s arbitration agreements were both procedurally and substantively unconscionable, California’s First Appellate District’s recent decision highlights certain contractual terms and...more

Fisher Phillips

California Supreme Court Provides Valuable Blueprint For Your Arbitration Agreement Strategy

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The California Supreme Court recently handed down an intriguing decision which casts doubt on – and in some cases even condemns – some of the most common practices used by employers in both drafting and presenting arbitration...more

Littler

Easily “Shocked”? At Least for Wage Claims, California Supreme Court Lowers Standard for Unconscionability in Arbitration...

Littler on

In OTO, L.L.C. v. Kho, the California Supreme Court refused to enforce an employee’s arbitration agreement on the basis that it was unconscionable.  Unconscionability has long been a common-law defense to contract...more

FordHarrison

Lessons in Drafting and Implementing an Enforceable Mandatory Arbitration Agreement

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Recently, the California Supreme Court invalidated a mandatory arbitration agreement in OTO, LLC v. Kho (August 29, 2019) finding the agreement was both procedurally and substantively unconscionable. The case involved...more

Seyfarth Shaw LLP

California Invalidates Wage Arbitration Agreement, Inviting U.S. Supreme Court Review

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Seyfarth Synopsis: The California Supreme Court invalidated an employment arbitration agreement on August 29, 2019. At issue in OTO, LLC v. Kho was an agreement to arbitrate employment claims, including wage claims. Under the...more

Carlton Fields

Alabama District Court Enforces Arbitration Clause Related to Disability Policy Over Unconscionability Claim

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The U.S. District Court for the Northern District of Alabama has compelled arbitration despite a former employee’s claim that the arbitration clause in the policy at issue was unconscionable under the circumstances related to...more

Carlton Fields

West Virginia Supreme Court Reverses, Finds “Delegation Clause” in Employment Arbitration Agreement Neither Ambiguous nor...

Carlton Fields on

Petitioners, two Rent-A-Center entities, moved to compel arbitration of a lawsuit by Anita Ellis alleging that Rent-A-Center unlawfully terminated her employment for seeking workers’ compensation benefits....more

Hogan Lovells

California Appellate Courts Diverge on Arbitration Agreements

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Two California Courts of Appeal came to two different conclusions on motions to compel arbitration on the same day last week (April 10), again demonstrating the care that must be taken in drafting and presenting arbitration...more

Carlton Fields

Tenth Circuit Strikes Offending Arbitration Provision Clause In Au Pair Agreements

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Plaintiffs had entered into various au pair agreements which contained arbitration provisions, which defendants sought to enforce when a class action was filed. ...more

Payne & Fears

Ninth Circuit Reverses Grant of Class Certification and Denial of Motions to Compel Arbitration in Several Uber Class Actions

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In a major victory for ride-share company Uber Technologies, Inc. ("Uber"), the United States Court of Appeals for the Ninth Circuit issued its much anticipated opinion in O'Connor v. Uber Technologies, Inc., Case No....more

Carlton Fields

Ninth Circuit Finds Arbitration Agreement In Employment Application Was Unconscionable

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In this case, Ritarose Capili, a sales associate, brought an action against her former employer The Finish Line, Inc. (“Finish Line”), an athletic retailer in California federal court. Finish Line made a motion to compel...more

Carlton Fields

Ninth Circuit Reverses District Court Decision On Unconscionability Of Dispute Resolution Agreement, Severs Problematic Provisions

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The Ninth Circuit reversed a district court’s finding that a dispute resolution provision (“the Provision”) of an employment agreement was substantively and procedurally unconscionable, upholding the provision as not tainted...more

Carlton Fields

California Supreme Court Enforces Arbitration Agreement, Finding It Is Not Unconscionable

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In this case, a former employee of a retail store appealed to the California Supreme Court seeking reversal of an appellate court decision which found that an arbitration agreement in her employment application was not...more

McManis Faulkner

Carbajal v. CWPSC Decision Provides Guidance for Drafting Employment Arbitration Agreements

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On February 26, 2016, the California Court of Appeal, Fourth District, issued its decision in Carbajal v. CWPSC, Inc., invalidating an employment arbitration agreement due to a number of provisions the Court considered...more

Seyfarth Shaw LLP

Don’t Throw the Class Waiver Baby Out with the Arbitration Agreement Bathwater

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Sound advice that the world has lived with since 1512…until recently flushed by the Ninth Circuit. Not so quick to discard 500 years of wisdom, however, the Supreme Court has agreed to consider whether this idiom will rest in...more

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

Missouri Supreme Court “Calls an Audible,” Upholds Arbitration Agreement

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In recent years, Missouri courts have seemed reluctant to enforce arbitration agreements entered into between employers and employees. But in a recent decision, the Missouri Supreme Court reversed that trend and compelled...more

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