When in doubt, arbitrate it out! That is the message sent by a recent District of New Jersey decision Coiro v. Wachovia Bank, 2012 U.S. Dist. LEXIS 24508 (D.N.J. Feb. 27, 2012) which enforced an arbitration provision and class-action waiver in a consumer contract, and rejected numerous common-law arguments of unconscionability.
The Coiro decision is the natural outgrowth of recent decisions by higher courts that a well-drafted arbitration provision will be enforced to the broadest extent possible, even if it limits the right to commence a putative class action. Thus, corporations should strongly consider reviewing their consumer contracts to add/modify their arbitration and class-action waiver provisions.
Enforcement of Arbitration and Class-Action Waivers
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