Arbitration
 Mandatory Arbitration in Collective Bargaining Agreements
Illinois Bell Telephone Co. v. International Brotherhood of Electrical Workers, Local 21
No. 07-734
Supreme Court of the United States
NCLC urged the Supreme Court to review a Seventh Circuit decision that judicially imposes “interest arbitration” into most collective bargaining agreements where issues not resolved by the parties through bargaining could be imposed by an arbitrator. In its brief, NCLC argued that federal policy favors arbitration. In the collective bargaining agreement setting, however, without the benefit of contractually bargained for arbitration limitations, every action of an employer could be challenged. At the very core of labor grievance arbitration provisions is the parties’ desire to obtain some stability and predictability in industrial operations. If left in place, the Seventh Circuit decision jeopardizes the careful balance necessary to maintain industrial peace and economic stability.
Amicus brief filed 12/28/07.
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Whether Decisions About Contract Validity Should Be Made By Arbitrators Or State Agencies
Preston v. Ferrer
No. 06-1463
Supreme Court of the United States
NCLC urged the Supreme Court to clarify that its decision in Buckeye Check Cashing v. Cardegna applies with equal force to state administrative agencies' decisions about contract validity when the contract includes an arbitration provision. In Buckeye Check Cashing, the Court relied on well-established precedent to conclude that arbitrators-not courts-are empowered by the Federal Arbitration Act to resolve issues of contract validity when the validity of the arbitration provision itself is not at issue. In this case, the state trial court held that, under California law, petitioner must first exhaust administrative remedies with the California Labor Commissioner before seeking relief from an arbitrator. In its brief, NCLC argued that the FAA preempts California law and that decisions about contract validity should be made by arbitrators in the first instance.
Amicus brief filed 11/8/07. Oral argument to be held 1/14/07.
Amicus brief
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 Litigation Misconduct and Waiver of Arbitration Right
Hoffman v. American Express Travel Related Services Co.
No. S155439
California Supreme Court
The California Supreme Court refused to consider whether a party forfeits its contractual right to arbitration if it is alleged to have engaged in litigation misconduct. In this case, plaintiffs charge the defendant with having misrepresented the benefits of a proposed settlement. In its brief, NCLC argued that the California Court of Appeal's decision undermined significant California Supreme Court precedent and that the right to arbitration should not be forfeited absent extraordinary circumstances.
Amicus brief filed 9/17/07. Decision 10/31/07.
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Unconscionability of Arbitration Provision and Right to Opt Out
Gentry v. Superior Court of Los Angeles CountyS141502 California Supreme Court
The California Supreme Court disagreed with NCLC and held that employment arbitration agreements that prohibit classwide relief are unenforceable if class arbitration would be a significantly more effective way of vindicating employees' rights than individual arbitration. In this case, the employment contract barred the use of classwide arbitration to adjudicate employment claims. Instead, the employment contract required employees to use individual arbitration but granted employees the right to opt out within thirty days of signing the contract. In its brief, NCLC argued that finding unconscionability on the facts of this case would conflict with the strong preference shown for arbitration under federal law.
Amicus brief filed 12/14/06. Decision 8/30/07.
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Arbitration of Employment Claims in Collective Bargaining Agreements
Pyett, et al. v. Pennsylvania Building Company, et al.No. 06-3047 U.S. Court of Appeals for the Second Circuit The Second Circuit disagreed with NCLC and affirmed a district court decision that mandatory arbitration clauses in collective bargaining agreements are unenforceable if they waive the rights of covered workers to a judicial forum for federal statutory causes of action. NCLC argued that it was corrosive to good working relationships between employers and unions if express agreements to submit all disputes to the grievance and arbitration process could be circumvented by some employees who pursue their own individual lawsuits.
Amicus brief filed 10/2/06. Oral argument held 6/27/07. Decision 8/1/07.
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Unconscionability of Class Arbitration Waivers Scott v. Cingular WirelessNo. 77406-04 Washington Supreme Court
The Washington Supreme Court held that a class arbitration waiver contained within an arbitration provision renders the provision unconscionable under Washington law. In its brief, NCLC described the benefits of arbitration, among which are lower overall costs and speed of decision, and explained that permitting classwide arbitration undermines those benefits without delivering any offsetting advantage over individual arbitration.
Amicus brief filed 1/27/06. Decision 7/12/07.
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Arbitration Provisions and Class Action Waivers
Tillman v. Commercial Credit Loans, Inc.
No. 360A06
North Carolina Supreme Court
Recommending that the decision of the intermediate appellate court be affirmed, NCLC filed a brief arguing that contracts containing arbitration provisions with class action waivers are not unconscionable under North Carolina law. In this case, though barred by their financing contracts from doing so, plaintiffs filed a putative class action complaint against their mortgagors. Relying on explicit contractual language and rejecting the notion that an arbitration requirement with a class action waiver is unconscionable, the court below dismissed the case and ordered arbitration. In addition to making clear the comparative benefits of arbitration to plaintiffs and defendants, NCLC also argues that upsetting the parties' bargain impermissibly conflicts with the Federal Arbitration Act and therefore is preempted.
Amicus brief filed 11/16/06.
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 Arbitration Exemptions and Predatory Lending AllegationsSalley v. Option One MortgageNo. 50 EAP 2005 Supreme Court of Pennsylvania Eastern District Agreeing with NCLC, the Supreme Court concluded that parties may create exceptions to mandatory arbitration for real estate foreclosure without rendering the agreement unconscionable under Pennsylvania law. While Plaintiffs argued that arbitration facilitates predatory lending, NCLC explained to the court that plaintiffs do not suffer through arbitration; rather, arbitration serves as an efficient process for dispute resolution. Amicus brief filed 4/10/06. Oral arguement held 9/12/06. Decision 5/31/07. View brief
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Unconscionability of Class Arbitration Provisions
Kinkel v. Cingular Wireless LLC
No.100925
Supreme Court of Illinois
Urging the Illinois Supreme Court to uphold the use of provisions barring class-wide arbitration, NCLC explained that many of the benefits of arbitration would be forfeited. For instance, arbitrators do not have the case management experience of federal judges who have supervised class actions for the better part of the past four decades. In addition, class-wide arbitration significantly increases the costs to the parties with little attendant benefit beyond class litigation.
Motion to file amicus brief in support of petition for leave to appeal on 7/8/05. Motion to file amicus brief denied 7/20/05. Motion to file amicus brief on the merits filed 12/28/05. View brief........................................................................................................................... Unconscionability of Non-Mutual Obligations to Arbitrate and of Class-wide Arbitration WaiversDelta Funding v. HarrisNo. 58,437 New Jersey Supreme Court
In this case, the New Jersey Supreme Court agreed with NCLC's argument that arbitration agreements which preclude the use of class actions are not unconscionable. The court determined the class action bar was not unconscionable because the case raised high stakes and the prospect of attorneys' fees. The arbitration clause, which was included in a mortgage loan contract, provided that foreclosure actions, eviction actions and other rights of self-help could be litigated in court, but required that all other actions involving the contract be submitted to arbitration.
Motion for leave to file an amicus brief filed 11/17/05. Decision 8/9/06.
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Federal Preemption of California's Class-Arbitration Rule
Cingular Wireless, LLC v. Mendoza, et al.
No. 05-1119
Supreme Court of the United States
NCLC urges Supreme Court review of California's rule forbidding class-arbitration waivers as preempted by the Federal Arbitration Act and in conflict with numerous courts throughout the country. NCLC argues that California's anti-waiver rule demonstrates an open hostility that ignores the benefits of arbitration and discriminates against arbitration by inappropriately comparing it to, and requiring it to emulate, litigation.
Amicus brief in support of Certiorari filed 5/5/06. Cert. denied 6/5/06.
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Antitrust Arbitration Agreements
Academy of Medicine of Cincinnati, et al. v. Aetna Health, Inc., et al.
No. 04-0001
Supreme Court of Ohio
In this case, a group of physicians sued their HMOs, alleging various state antitrust violations. The physicians had contractually agreed to arbitrate "any and all claims arising out of or relating to" their contracts as well as their "business relationship[s]." Contrary to the majority of federal and state courts to consider the issue, the lower court held that this did not require arbitration of the antitrust claims because these claims could be decided without reference to the contracts themselves. NCLC argued in an amicus brief to the Ohio Supreme Court that this holding flouted well-established state (and federal) law that favors the broad construction of arbitration agreements, that antitrust claims do arise from the parties' business relationship, and that the crabbed reading of the agreement's language contravenes the public and private benefits of arbitration.
Amicus brief filed on behalf of Appellants filed 6/21/04. Decision 3/1/06.
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Unconscionability of Class Action Waivers in Arbitration Provisions
Muhammad v. County Bank of Rehoboth Beach, DelawareNo. 58,430 New Jersey Supreme Court
The New Jersey Supreme Court issued its decision regarding whether arbitration agreements which preclude the use of class actions are unconscionable under New Jersey law. In this case, the court determined the low value consumer fraud action at issue would be more difficult to prosecute without the lure of a class action settlement. Consequently, the court found the agreement unconscionable. NCLC argued that arbitration was an effective and useful alternative to litigation and that a class action bar was not unconscionable.
Motion for leave to file an amicus brief filed 11/17/05. Amicus brief filed 1/17/06. Oral argument held 2/14/06. Decision 8/9/06. View brief View decision...........................................................................................................................
Enforceability of Arbitration Agreements Prohibiting Class or Collective Actions
Caley v. Gulfstream Aerospace333 F. Supp. 2d 1367 (N.D.Ga. 2004) U. S. Court of Appeals for the Eleventh Circuit NCLC urges the 11th Circuit to affirm the district court's rulings that (1) a provision in an employment arbitration agreement barring class or collective actions is enforceable and (2) an alternate dispute resolution process culminating in mandatory arbitration does not violate the policies underlying the federal anti-discrimination statutes, the FLSA and ERISA. Amicus brief in support of the defendant filed 3/2/05. Decision 10/31/05.
Unconscionability of Class Arbitration Provisions
Kinkel v. Cingular Wireless LLC
No.100925
Supreme Court of Illinois
Urging the Illinois Supreme Court to grant review and then uphold the use of provisions barring class-wide arbitration, NCLC explains that many of the benefits of arbitration would be forfeited. For instance, arbitrators do not have the case management experience of federal judges who have supervised class actions for the better part of the past four decades. In addition, class-wide arbitration significantly increases the costs to the parties with little attendant benefit beyond class litigation.
Amicus brief filed in support of petition for leave to appeal on 7/8/05. Motion to file amicus brief denied 7/20/05. Motion to file amicus brief on the merits filed 12/28/05. Motion to file amicus brief denied 1/11/06.
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Unconscionability of Class-Wide Arbitration
Discover Bank v. Boehr
No. S113725
Supreme Court of California
The California Supreme Court determined that, in "some circumstances," provisions barring classwide arbitrations can be unconscionable under California law. NCLC had argued that the use of unconscionability principles to invalidate the class-action waiver in Discover Bank's arbitration provision would wreak havoc on countless arbitration provisions and that any rule of law that categorically impairs the enforceability of "form contracts" would have devastating implications on businesses and consumers alike.
Application to file amicus brief and amicus brief filed in support of defendant-petitioner filed 8/13/03. Application to file amicus brief in support of defendant-petitioner granted 8/18/03. Supplemental brief on new authority filed 12/16/04. Oral argument held 4/7/05. Decision 6/27/05.
Arbitrability of Allegedly Illegal Contracts
Buckeye Check Cashing v. Cardegna
No. 04-1264
U. S. Supreme Court
Relying on the seminal Supreme Court decision in Prima Paint Corp. v. Flood & Conklin Manufacturing Co., NCLC urged the Supreme Court to reverse the Florida Supreme Court's decision barring arbitration of assertedly illegal contracts even where there is no dispute that both parties assented to arbitration at the time of contracting. In this case, the plaintiffs assert that the check cashing contract incorporated usurious loan terms, but did not contest that they had agreed to arbitrate any matter "arising from or related to this Agreement."
Brief in support of certiorari filed 5/23/05.
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Unconscionability of Arbitration Agreements
Aguillard v. Auction Management Corp.
No. 2004-C-2804
Louisiana Supreme Court
NCLC urged the Louisiana Supreme Court to grant review in order to send a clear signal that arbitration was not a disfavored method of dispute resolution, as evidenced by pro-arbitration laws enacted by both the state and federal legislature. Without weighing the array of data demonstrating that both sides benefit from avoiding the costly judicial system, the intermediate appellate court improperly concluded that the arbitration agreement was one-sided and therefore unconscionable.
Brief in support of review filed 5/10/05, but rejected as untimely 5/19/05.
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Pre-dispute Jury Waivers
Grafton Partners L.P. v. Superior Court of Oakland
No. A102790
Supreme Court of California
NCLC urges the California Supreme Court to review a decision by an intermediate appellate court that, if allowed to stand, would invalidate all pre-dispute jury waivers in the state of California. The California constitution states that "a jury trial may be waived by the parties in all civil cases in the manner to be prescribed by law." The appellate court held that, therefore, the state legislature and only the state legislature may decide how and whether the right to a jury trial may be waived; because the legislature has not addressed the validity of pre-dispute jury waivers that are contained in commercial agreements, the court held, they are not valid. NCLC argued that this is not the natural reading of "prescribed by law," and moreover, that this ruling wreaks havoc with contracting parties of all types in California.
Amicus letter in support of review filed 4/7/04. Review granted and appellant's brief filed 8/26/04. Amicus letter brief on the merits filed 9/24/04.
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Pre-Dispute Jury Trial Waivers
Grafton Partners L.P. v. Superior Court of Oakland
No. A102790
Supreme Court of California
As urged by NCLC, the California Supreme Court agreed to review a decision by an intermediate appellate court that, if allowed to stand, would invalidate all pre-dispute jury waivers in the state of California. The California constitution states that "a jury trial may be waived by the parties in all civil cases in the manner to be prescribed law." The appellate court held that, therefore, the state legislature and only the state legislature may decide how and whether the right to a jury trial may be waived; because the legislature has not addressed the validity of pre-dispute jury waivers that are contained in commercial agreements, the court held, they are not valid. NCLC argued that this is not the natural reading of "prescribed by law," and moreover, that this ruling wreaks havoc with contracting parties of all types in California.
Amicus letter filed 4/5/04. Petition for review granted 4/21/04.
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