“Well, They Gave Me the Agreement in My Own Language, but I Still Didn’t Understand the English Version” doesn’t work.
The Federal Arbitration Act will turn 100 in the next few years, but despite more than nine decades of litigation, some opinions can be explained only by the “judicial hostility” to arbitration that caused the statute to be enacted in the first place.
Case in point. In Beltran v. AupaireCare, Inc., Case No. 17-1359 (10th Cir. Oct. 30, 2018), a group of au pairs brought suit against several au pair agencies, asserting claims for antitrust and under the Racketeer Influenced and Corrupt Organization Act (RICO), among others. The crux of the claim was that the agencies allegedly used the United States’ J-1 Visa program to tap foreign nationals as a source of cheap child care labor, with resulting low pay rates. Among other rulings, the district court certified a class of more than 90,000 au pairs, a questionable decision that likely deserves its own blog, but the key issue for this posting is the court’s refusal to enforce certain of the au pairs’ arbitration agreements. The district court concluded that the agreements were both procedurally and substantively unconscionable. In a nutshell, it relied on the fact that the plaintiffs were foreigners, English was not their first language and they did not understand the word “arbitration.” As to substantive unconscionability, the court found several clauses offensive, including a forum selection clause and one giving the defendants control over the selection of the arbitrator. While the number of offending clauses was small, the court then refused to sever them on the grounds that the provisions were “permeated” by unconscionable terms and “buried” toward the end of the contract.