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In 2014, the New Jersey Supreme Court held in Atalese v. U.S. Legal Services Group, L.P. that in order to be enforceable, arbitration clauses must contain an express waiver of the parties’ right to seek relief in a court of law.  Earlier this month, in County of Passaic v. Horizon Healthcare Services, Inc.… Continue Reading

A Texas federal court has dismissed a class action lawsuit against Opportunity Financial, LLC (“OppFi”) alleging OppFi violated Texas usury law by charging interest on loans it made through a partnership with a state-chartered bank at rates above the maximum rate permitted by Texas law.  The plaintiff alleges that the partnership was a “rent-a-bank” scheme to evade state law and that OppFi, rather than its bank partner, was the “true lender” on the loans.… Continue Reading

Last week, a California federal court granted Google’s motion to compel arbitration of claims asserted by customers who alleged that their Fitbit watches burned their skin.  The opinion in Houtchens v. Google found that the company’s “clickwrap” agreement put the plaintiffs on “reasonably conspicuous notice” of the company’s terms of service when they created online accounts to purchase the watches. … Continue Reading

Last Friday, the U.S. Supreme Court agreed to review whether an appeal of the denial of a motion to compel arbitration automatically stays proceedings in the lower court pending the outcome of the appeal, or whether the lower court has discretion to grant or deny a stay.  The decision will resolve a split between the Third, Fourth, Seventh, Tenth, Eleventh, and D.C.… Continue Reading

Earlier this week, we wrote about Verizon’s appeal to the Ninth Circuit from a district court ruling that the bellwether provision in its arbitration clause was unconscionable.  Both the U.S. Chamber of Commerce and the California Employment Law Council have filed amicus curiae briefs in support of Verizon’s position that bellwether procedures, which for decades have been used to help resolve complex court litigations, are equally beneficial in mass arbitration situations and not unconscionable.… Continue Reading

On September 13, 2022, Public Justice and other consumer advocacy groups sent a letter to CFPB Director Rohit Chopra urging the CFPB to limit the use of “forced” arbitration provisions by banks and other consumer finance companies.  According to reports appearing in Law360 and BNA, at a virtual event organized by Public Justice and held the day after the letter was sent, Director Chopra expressed concerns about such provisions and is trying to “figure out what the path forward is.”… Continue Reading

According to a report appearing in today’s Law360, CFPB Director Rohit Chopra has indicated that the agency appears unlikely, at least in the near future, to undertake new rulemaking that would regulate the use of consumer arbitration agreements.  The CFPB’s previous rule—which would have forbidden companies from including class action waivers in consumer arbitration agreements—was overridden by Congress in 2017 under the Congressional Review Act. … Continue Reading

Recently, a divided panel of the U.S. Court of Appeals for the Third Circuit held in Zirpoli v. Midland Funding, LLC that an arbitrator, not the district court, must decide whether class action claims brought against Midland Funding LLC are subject to arbitration.  The question in Zirpoli was whether a challenge to the legality of an assignment of a loan that is subject to an arbitration agreement challenges the formation of the arbitration agreement itself. … Continue Reading

The U.S. Supreme Court has once again confirmed that the Federal Arbitration Act (FAA) preempts incompatible state laws that preclude contracting parties from controlling which claims are subject to arbitration.  Ruling in favor of the employer in Viking River Cruises, Inc. v. Moriana, the Court held that the California courts erred in refusing to compel arbitration of an employee’s individual claim under the State’s Private Attorneys General Act (PAGA).… Continue Reading