Iberia Credit Bureau, Inc. v. Cingular Wireless LLC , 379 F.3d 159 (5th Cir. 2004)
In another Circuit Court case, involving a group of telephone companies, we find a different issue being addressed. In Iberia Credit, the contractual clause which Cingular customers agreed to by signing the service agreement read (in part) as follows:
[I]nstead of suing in court, CINGULAR and you agree to arbitrate any and all disputes and claims (including but not limited to claims based on or arising from an alleged tort) arising out of or relating to this Agreement.
This clause, along with the Sprint clause litigated in the action raised issues either addressed elsewhere in these materials or issues not relevant to our current purpose. The real difficulty comes with the Centennial arbitration clause:
Dispute Resolution; Waiver of Trial by Jury; Waiver of Class Actions-Please read this section carefully. It affects rights that you may otherwise have. It provides for resolution of most disputes through arbitration instead of court trials and class actions. . . . You agree that instead of suing in court, you will arbitrate any and all disputes and claims arising out of this Agreement or the Service. Even if applicable law provides otherwise, you and we each waive our right to a trial by jury and to participate in class actions. . . . By this agreement, both you and we are waiving certain rights to litigate disputes in court. If for any reason this arbitration clause is deemed inapplicable or invalid, you and we both waive, to the fullest extent allowed by law, any claims to recover punitive or exemplary damages and any right to pursue any claims on a class or consolidated basis or in a representative capacity. Iberia Credit at 168.
The concept of unconscionability was briefly touched upon in the materials covering the valid drafting of negotiated settlement agreements (Chapter 4). The essential claim in Iberia Credit was that the mandatory arbitration clause in the Centennial cellular phone contract was unconscionable, and therefore unenforceable. Iberia Credit at 165.
Interestingly, in Footnote 6, the court points out that plaintiffs and defendants have proceeded under the assumption that the question of unconscionability is to be addressed by the court rather than by the arbitrator, and the court says that it “will therefore proceed on the same basis.”
According to the court, the FAA “puts arbitration agreements on the same footing as other contracts,” and therefore traditional defenses to contract, such as unconscionability, can be used to invalidate an arbitration agreement without running afoul of the FAA. Iberia Credit at 166, quoting Doctor’s Assocs. V. Casarotto, 517 U.S. 681, 687 (1996).
The question is therefore whether the Centennial arbitration clause is unconscionable. If so, it will be unenforceable.
The Iberia Credit court stated, at 169, that the “one-sidedness of the duty to arbitrate raises a serious question as to the clause's validity,” and ultimately found that the one-sidedness was sufficiently extreme so as to render the arbitration clause unenforceable.
Crucial here was Centennial’s choice of language. “You agree that instead of suing in court, you will arbitrate any and all disputes and claims,” is the only time that “you” is used by itself, and the remainder of the paragraph refers to “you and we.” Because this language requires customers bring an action solely through arbitration, but would allow Centennial to bring an action in court or arbitrate, at their discretion, there is a distinctly one-sided lack of mutuality, which ultimately proved fatal to Centennial’s argument.
Iberia Credit Bureau, Inc. v. Cingular Wireless LLC , 379 F.3d 159 (5th Cir. 2004)In another Circuit Court case, involving a group of telephone companies, we find a different issue being addressed. In Iberia Credit, the contractual clause which Cingular customers agreed to by signing the service agreement read (in part) as follows:[I]nstead of suing in court, CINGULAR and you agree to arbitrate any and all disputes and claims (including but not limited to claims based on or arising from an alleged tort) arising out of or relating to this Agreement.This clause, along with the Sprint clause litigated in the action raised issues either addressed elsewhere in these materials or issues not relevant to our current purpose. The real difficulty comes with the Centennial arbitration clause:Dispute Resolution; Waiver of Trial by Jury; Waiver of Class Actions-Please read this section carefully. It affects rights that you may otherwise have. It provides for resolution of most disputes through arbitration instead of court trials and class actions. . . . You agree that instead of suing in court, you will arbitrate any and all disputes and claims arising out of this Agreement or the Service. Even if applicable law provides otherwise, you and we each waive our right to a trial by jury and to participate in class actions. . . . By this agreement, both you and we are waiving certain rights to litigate disputes in court. If for any reason this arbitration clause is deemed inapplicable or invalid, you and we both waive, to the fullest extent allowed by law, any claims to recover punitive or exemplary damages and any right to pursue any claims on a class or consolidated basis or in a representative capacity. Iberia Credit at 168.The concept of unconscionability was briefly touched upon in the materials covering the valid drafting of negotiated settlement agreements (Chapter 4). The essential claim in Iberia Credit was that the mandatory arbitration clause in the Centennial cellular phone contract was unconscionable, and therefore unenforceable. Iberia Credit at 165.Interestingly, in Footnote 6, the court points out that plaintiffs and defendants have proceeded under the assumption that the question of unconscionability is to be addressed by the court rather than by the arbitrator, and the court says that it “will therefore proceed on the same basis.”ตามศาล ฟ้า "ทำให้ข้อตกลงอนุญาโตตุลาการในหลักเดียวกันเป็นสัญญาอื่น" และดังนั้นจึง สามารถใช้ป้องกันแบบสัญญา เช่น unconscionability เพื่อทำให้ข้อตกลงอนุญาโตตุลาการไม่ทำชนฟ้า สินเชื่อ Iberia ที่ 166 อ้างแพทย์ Assocs V. Casarotto, 517 สหรัฐฯ 681, 687 (1996)คำถามจึงว่าเซนเทนเนียลอนุญาโตตุลาการอนุประโยคเป็น unconscionable ถ้าดังนั้น คุณจะไม่ศาล Iberia เครดิตระบุไว้ ที่ 169 ที่ "one-sidedness หน้าที่ชี้ขาดยกคำถามอย่างจริงจังเป็นส่วนมีผลบังคับใช้ และในที่สุด พบว่า one-sidedness ที่ถูกมากเพียงพอเพื่อแสดงส่วนคำสั่งอนุญาโตตุลาการไม่มีผลบังคับสำคัญที่นี่มีหลากหลายภาษาของเซนเทนเนียล "คุณยอมรับว่า แทนที่จะฟ้องร้องในศาล คุณจะชำระใด ๆ และทั้งหมดข้อโต้แย้งและร้องเรียน คือ เวลาที่"คุณ"ใช้ ด้วยตัวเอง และส่วนเหลือของย่อหน้าหมายถึง"คุณและเรา" เนื่องจากภาษานี้ต้องลูกค้านำการดำเนินการทางอนุญาโตตุลาการเท่านั้น แต่จะช่วยให้เซนเทนเนียล การนำการดำเนินการในศาลชำระ ความ ที่พวกเขาพิจารณา ไม่มีขาดด้านเดียวอย่างเห็นได้ชัดของ mutuality ซึ่งในที่สุด พิสูจน์ร้ายแรงกับอาร์กิวเมนต์ของเซนเทนเนียล
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