Arbitration Pacts Get Supreme Boost Over State Contract Law

Workers will have more difficulty preventing the enforcement of mandatory arbitration agreements based on state contract law in light of the U.S. Supreme Court’s April 24 ruling on class arbitration, attorneys told Bloomberg Law.

The Supreme Court’s five-justice conservative majority reversed a federal appeals court’s decision that had allowed class arbitration over an employer’s objection based on California’s rule that an ambiguous contract should be construed against the drafter, which will almost always be the employer.

That contract rule is premised on a public policy concern—evening out the inequality in parties’ bargaining strength—rather than an attempt to discern the meaning ...