Arbitration is having its 15 minutes of fame. Thanks to a series in the New York Times, my inbox is full of links to the articles, questions about the information, and fascinating commentary. [Next time I am in Oakland, I am totally having the “Scalia” cocktail at Italian Colors.] With the far-reaching audience of the NYT, the policy questions surrounding waivers of class arbitration are no longer just a conversation among in-house counsel, advocates, and law professors, but . For anyone passionate about arbitration law, it’s like Christmas morning. Jumping past the merits of the policy questions for a moment, what could happen if the public demands that its representatives take action?
One possibility is that there may be more cases like McLeod v. General Mills, Inc., Case No. 15-494 (D. Minn., October 23, 2015). In that case, the Chief Judge of the District of Minnesota found that an employee collective action could go forward in court, despite a valid arbitration agreement that demanded individual actions. Why? Because language in the Older Workers Benefit Protection Act of 1990 (OWBPA) provides that any worker challenging the validity of a waiver of ADEA (Age Discrimination in Employment Act) rights “shall have the burden of proving in a court of competent jurisdiction that a waiver was knowing and voluntary.” The court found that the statute’s use of “shall” along with “court” was sufficient to trump the earlier and more general requirement that courts enforce arbitration agreements (in the FAA). [Some of the workers in the case are just 42, and 44 years old. Could I really be that close to the definition of an “older worker”??]
Unless there is a wholesale rewriting of the FAA, which seems unlikely, any action to ensure the availability of class and collective actions in court will likely take place one industry or one specific statute at a time. The CFPB may require that consumers of financial products can bring class actions in court. And members of Congress may start inserting language like the text of the OWBPA into other statutes designed to protect certain classes of employees and consumers. Although, in my experience, the most likely outcome is that arbitration’s 15 minutes will pass, and it will go back to something talked about only by lawyers, judges and professors, and nothing will change until the current SCOTUS majority becomes the minority.