Arbitration

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Sixth Circuit Affirms: AAA Rules Require Disputes Over Arbitrability Be Decided in Arbitration

Parties that have agreed to arbitrate certain disputes often disagree about whether a particular claim falls within their agreement to arbitrate, and also about who should make that threshold determination: a court or an arbitrator. The well-established rule is that a court should decide such gateway questions of whether a claim falls within an agreement to arbitrate, absent “clear and unmistakable evidence” that the parties agreed that an arbitrator should do so. E.g., Coinbase, Inc. v. Suski, 602 U.S. 143, 149 (2024). Given that demanding standard, one could be forgiven for assuming that such questions would typically be resolved in court. But that is frequently not the case, as illustrated by the Sixth Circuit’s recent decision in New Heights Farm I, LLC v. Great Am. Ins. Co., No. 24-1087, — F.4th —- (6th Cir. Oct. 15, 2024).Continue Reading Don’t Put the Cart Before the Horse

In August, Disney found itself in a public-relations firestorm. Facing a wrongful-death lawsuit after a customer suffered an allergic reaction at a Disney World restaurant, the company had attempted to use the arbitration clause in the Disney+ terms of service to force the suit out of court and into arbitration, and the public reacted negatively. Disney ultimately withdrew its request for arbitration. 

Last week, Uber found itself in the news when a New Jersey appellate court held that the rideshare company’s arbitration clause was enforceable against a couple who were injured in an automobile accident when their Uber driver ran a red light. We often file motions to compel arbitration in consumer suits, so we thought we would provide three thoughts on this latest suit.Continue Reading Not the Same “Small World”: Three Thoughts on the Disney and Uber Arbitration Cases

On Monday, the U.S. Supreme Court, in Morgan v. Sundance, Inc., overturned the arbitration-specific waiver rules in nine circuits that had held a finding of prejudice was essential to determining whether a party had waived its right to arbitrate. Instead, courts should apply “ordinary procedural rules” — such as the federal law that waiver is the intentional relinquishment or abandonment of a known right (without a prejudice requirement) — to determine whether an arbitration agreement is enforceable.
Continue Reading No More Special Arbitration-Waiver Rules