In their 2013 concurrence in Oxford Health Plans LLC v. Sutter, Justice Samuel Alito, joined by Justice Clarence Thomas, questioned whether absent class members “will be bound by the arbitrator’s ultimate resolution of th[e] dispute” in a class arbitration. Justice Alito suggested that where an arbitration agreement provides “no reason to think that the absent class members ever agreed to class arbitration,” an affirmative answer was unlikely. He posited that “an arbitrator’s erroneous interpretation of contracts that do not authorize class arbitration cannot bind someone who has not authorized the arbitrator to make that determination.” Taken to its logical end, Justice Alito’s rationale would support an argument that class arbitrations should be limited to adjudicating only the claims of class members who affirmatively opt in to the class arbitration proceedings.Read More
The U.S. Supreme Court has issued numerous decisions over the past decade addressing arbitration agreements.  In one of the Roberts Court’s first forays into the arbitration arena, the Court held that class or collective arbitration is only available where the parties have affirmatively agreed to resolve their disputes through such procedures.  But who determines whether the parties have so agreed — a court or an arbitrator?
In Stolt-Nielsen S.A. v. AnimalFeeds International Corp.,  the U.S. Supreme Court held that “a party may not be compelled” under the Federal Arbitration Act (“FAA”) “to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so.”  The Stolt-Nielsen Court found that an agreement that is silent on the availability of class arbitration does not provide sufficient evidence that the parties intended to submit to class, as opposed to individual, arbitration.  The Court, however, left open the question of what level of specificity an agreement must contain to demonstrate the parties’ consent to submit a dispute to class arbitration.