Jean Sternlight: Asking Tough Questions About Mandatory Arbitration and Article III

Sternlight has been writing about arbitration for years, and has some interesting comments about the Supreme Court's opinion last week in Sharif at the Indisputably blog.  An excerpt:

The Supreme Court’s most recent Article III decision, Wellness Int’l v. Sharif (2015), raises substantial questions as to the constitutional legitimacy of the Federal Arbitration Act, 9 U.S.C. § 1 et seq., at least as applied to private mandatory arbitration. * * *

A five justice majority (Sotomayor, Kennedy, Ginsburg, Breyer & Kagan), also joined by Justice Alito, in substantial part, held that litigants may “knowingly and voluntarily” allow a bankruptcy judge to hear claims that, absent such consent, Article III would bar the bankruptcy judge from deciding.* * *

* * * [W]hen courts have sought to justify arbitration on the ground that parties “consented” to bring claims in arbitration rather than in court, they have not applied the “knowing and voluntary” definition of consent recently applied in Sharif. If courts did look for knowing and voluntary consent they would find that while many business-to-business arbitration agreements meet the test, few if any consumer and employment clauses do so.

Those interested in the matter should read the entire post  (HT: Elayne Greenberg).

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