Lessons from Supreme Court Decision Regarding Class-wide Arbitration

This week, the Supreme Court released its decision in Oxford Health Plans v. Sutter (http://www2.bloomberglaw.com/public/desktop/document/Oxford_Health_Plans_LLC_v_Sutter_No_12135_2013_BL_151235_US_June_).  The Court upheld a decision by an arbitrator that the arbitration agreement at issue allowed for class-wide arbitration, a determination that the defendant clearly did not favor.  The Court held that as long as the arbitrator was arguably interpreting the arbitration contract his decision was binding on the parties.  Two critical lessons arise from this decision for defendants who do not want to be subject to class actions in arbitration for elsewhere.  First:  If you don't want class-wide arbitration, your arbitration agreement needs to clearly so state.  Make it impossible for an arbitrator to "interpret" the arbitration agreement to allow class-wide arbitrations.  Second:  Don't agree to let the arbitrator decide if class-wide arbitration is permissible.  Here, defendant Oxford Health Plans agreed that the arbitrator could decide the issue.  Oxford Health got stuck with the bad result -- which might not have happened had a court made the decision with rights to appeal a questionable result.