Online games company loses motion based on unconscionability
Defendants plagued by failure to include arbitration clause in sweepstakes rules
A class-action lawsuit against an online sweepstakes operator will go forward despite the plaintiffs’ admitted agreement to an arbitration clause. The sweepstakes offered the chance to win $1.2 million in Dogecoin, a type of cryptocurrency. The plaintiffs in the Northern District of California district court action, styled Suski v. Marden-Kane et al., initially agreed to arbitrate all disputes at the time they opened their online accounts with defendant Coinbase Global, Inc.
5-4 decision rejects traditional principles of contract interpretation
The Supreme Court has unanimously vacated a Fifth Circuit decision concerning arbitrability. The court held that courts my not override a contract that tasks arbitrators with determining whether a claim should be arbitrated or litigated, even in the case that the quest for arbitration is “wholly groundless.”
Many businesses involved in online commerce seek to reduce the risk of lawsuits by including arbitration clauses and class action waivers in their website terms and conditions.
As class actions and other forms of litigation continue to plague corporate America as a major cost of doing business, businesses should be cognizant of one potent antidote that has repeatedly received judicial approval: mandatory arbitration clauses.