• Supreme Court Holds that the Federal Arbitration Act Preempts State Law Limitations on Arbitration Agreements
  • April 29, 2011 | Authors: Wilson G. Barmeyer; Thomas M. Byrne; Steuart H. Thomsen; Gail L. Westover; Lewis S. Wiener
  • Law Firms: Sutherland Asbill & Brennan LLP - Washington Office ; Sutherland Asbill & Brennan LLP - Atlanta Office ; Sutherland Asbill & Brennan LLP - Washington Office
  • In a much-anticipated decision regarding class actions and arbitration, the U.S. Supreme Court held on April 27, 2011, that the Federal Arbitration Act (FAA) preempts state contract law limitations on the enforceability of arbitration agreements. In a 5-4 opinion by Justice Scalia in AT&T Mobility v. Concepcion, No. 09-893, 563 U.S. --- (April 27, 2011), the Court held that California’s Discover Bank rule, which classified most collective-arbitration waivers in consumer contracts as unconscionable, stood as “an obstacle” to Congressional purpose and is, therefore, preempted by the FAA.