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No Class Arbitration When Agreement Silent, High Court Says

April 24, 2019, 2:09 PM

An ambiguous agreement can’t be the basis for concluding parties agreed to class arbitration, the U.S. Supreme Court ruled April 24.

The case asked the court to consider if classwide arbitration is allowed when the arbitration agreement doesn’t expressly permit or forbid it.

Lamps Plus employee Frank Varela filed the case as a class action after his personal information was shared by a fellow employee who fell for a phishing attack. The company sought to resolve the case in individual arbitration, but the courts agreed with Varela that state contract law authorized class arbitration.

The case is Lamps Plus, Inc. v. Varela, U.S., No. 17-988, 4/24/19.

To contact the reporter on this story: Perry Cooper in Washington at pcooper@bloomberglaw.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com

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