Cozen O’Connor: How Do Courts Decide Enforceability of Arbitration Clauses? [The Legal Intelligencer]

How Do Courts Decide Enforceability of Arbitration Clauses? [The Legal Intelligencer]

Arbitration clauses are the fashion now. We are frequently reminded that parties save time and money through the arbitration alternative to litigation. It is not without irony, then, that arbitration clauses have engendered plenty of old-fashioned litigation. Two recent Pennsylvania federal court decisions deal with the enforceability of arbitration clauses, and both decisions foretell of added litigation in the arbitration arena.

The two cases, Crumpler v. Midland Credit Management, No. 13-1953 (Dec. 13, 2013), and Porreca v. The Rose Group, No. 13-1674 (Dec. 11, 2013), come out of the Eastern District of Pennsylvania. They both decide motions to compel arbitration, and they demonstrate that such motions will often require discovery, and perhaps trial, to be resolved. Contrary to the intent and spirit of arbitration clauses, enforcing an arbitration clause is not always easy. Ironically, such clauses seem to foment litigation in the name of avoiding it.

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