U.S. Fifth Circuit Re-Affirms pre-Stolt-Nielsen Caselaw referring the Question of Collective or Class Action under the Arbitration Agreement to the Arbitrator

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Stolt–Nielsen does not overrule prior Supreme Court and Fifth Circuit decisions requiring questions of arbitrability, including the availability of class mechanisms, to be deferred to arbitration by agreement.”

In this particular case:

“Section (g) of the arbitration agreement subjects ‘claims challenging the validity or enforceability of this Agreement (in whole or in part) or challenging the applicability of the Agreement to a particular dispute or claim’ to arbitration.”  The defendant’s arguments, however, “are a misguided attempt to bootstrap a preliminary proceeding into judicial review of an arbitration award that does not yet exist. J & K may be right that the agreement does not allow class or collective arbitration, but that is not the issue before the court. The issue is who decides if the arbitration agreement permits class or collective procedures.

“Contract language similar to section (g) has been found to authorize deferral of arbitrability issues. In Green Tree, the plurality held that language submitting ‘all disputes, claims or controversies arising from or relating to this contract’ to arbitration was sufficient for deferral. Similarly, in Pedcor Management, this court concluded that a clause submitting ‘any dispute … in connection with the agreement’ included determinations of class or collective arbitration. And, in Rent–A–Center, West, Inc. v. Jackson, an agreement granting exclusive authority to an arbitrator ‘to resolve any dispute relating to the interpretation, applicability, enforceability or formation of the agreement’ was determined to be an unambiguous and proper delegation of authority under the Federal Arbitration Act.

“Section (g) is materially similar to this contract language. It requires that ‘claims challenging the validity or enforceability of’ the agreement must be arbitrated. Therefore, we conclude that section (g) is unambiguous evidence of the parties intention to submit arbitrability disputes to arbitration and that arbitration was properly compelled.”

 

Robinson v. J&K Admnistrative Management Services, No.15-10360, 2016 WL 1077102 (5th Cir. March 17, 2016).

 

 

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