Get California High Court Weighs In On Class Action Waivers

A class action waiver is a legal agreement that eliminates the right of an individual to join a class action lawsuit against the other party. This waiver is typically included in contracts between consumers and companies and is used to protect the company from costly class action litigation.

Arbitration agreements require that persons who signed them resolve any disputes by binding arbitration, rather than in court before a judge and/or jury. What is binding arbitration? Binding arbitration involves the submission of a dispute to a neutral party who hears the case and makes a decision.

Generally, disputes in rem which are regarding a thing or property can't be resolved through arbitration, while disputes in personam regarding a selected person are often.

A class action waiver is a provision found in some contracts which prohibits a party from filing a class action legal proceeding against the other party, or both parties waiving the right to file class actions against each other.

So long as a defendant can show a valid agreement to arbitrate and a valid class action waiver, then a putative class action plaintiff will be unable to proceed on a class basis.

The Supreme Court of the United States has found on multiple occasions that class action waivers are legal.

Unfortunately, class action waiver provisions are usually enforceable in the United States, even though they take away a very important right: the right to join together to correct corporate wrongdoing.

In some instances, you may be able to sue if you signed a valid arbitration agreement. While courts generally favor arbitration agreements, they will allow you to file a lawsuit if either you didn't understand your rights or your claims fall outside the arbitration provision's scope.