After recently hearing oral argument in Lamps Plus Inc. v. Varela, the United States Supreme Court is set to decide whether the Federal Arbitration Act forecloses a state-law interpretation of an arbitration agreement that would result in permitting class arbitration. Arbitration is a function of contract, and therefore parties may agree to aggregated arbitrations in theory, though many questioned their practicality given the principal aims of arbitration – efficiency, speed, and finality. The question before the Court, however, is whether state-law contract interpretative principles should control when arbitration agreements are silent on the issue of class arbitration.

In the underlying decision, the Ninth Circuit held that, under California law, when an arbitration agreement is silent on the issue of class arbitration, it may be ambiguous, and therefore subject to interpretation against the drafter, i.e., interpreted to permit class arbitration. Lamps Plus, however, argues that federal law demands clearer language before a party can be required to arbitrate on an aggregated basis.

This case follows the heels of Stolt-Nielsen, where the United States Supreme Court held that a party may not be compelled to submit to class arbitration under the Federal Arbitration Act, unless there is a contractual basis for concluding that the party agreed to do so. As a practical matter, the Court’s ruling in Lamps Plus Inc. v. Varela may have limited practical impact because of the ever-growing prevalence of class action waiver clauses in arbitration agreements, the use of which the Court has repeatedly affirmed as legally enforceable.

On Thursday, December 6, 2018 from 8:00 a.m. – 10:30 a.m. Central, the Chicago office of Seyfarth Shaw LLP will present “Seyfarth Legal Forum and CLE: 2018 Highlights And a Look to 2019″.

About the Program

Why should you be interested in joining us?  Because we will be providing our clients with a multidisciplinary overview of Legal Hot Button issues and Best Practices — featuring a panel of Seyfarth Chicago subject matter experts — with an eye toward preparing for the developments in the coming year.

The program will consist of an engaging 90 minute presentation with speakers from each of Seyfarth Chicago’s practice groups: Benefits, Corporate, Labor & Employment, Litigation and Real Estate, as well as an exciting presentation on the use of technology in law. This outstanding panel will address:

  • Biometric Information Privacy Act: What a long, strange year it’s been (and there’s more on the way!)
  • Legalize it: will Illinois go from medical to recreational marijuana and what would that mean to the real estate industry?
  • Affordable Care Act Update & Enforcement Activities, 401(k) Student Loan Repayment Arrangements, Socially Responsible Investments, and HIPAA Privacy & Security Audits
  • Mergers and Acquisitions: Current State of the Market and Post-Merger Integration Strategies
  • The “Cloud”…is in a building?: Data Centers are the newest, and maybe most important, type of real estate
  • Latest Developments in Pregnancy Accommodation (Illinois’ New Lactation Law and Nationwide Trends)
  • Litigation Hot Topics for 2019, including: Developments in trade secret and non-compete law; New laws affecting threshold issues such as forum selection and choice of law; Frontloaded discovery in federal court: Mandatory Initial Discovery Pilot Programs; Best practices for protecting the attorney-client privilege for in-house counsel
  • Welcome to the Future: It arrived yesterday – The intersection of Technology and Legal Services
  • Bots, bits and bytes… Artificial Intelligence and its leading role in recent legal projects

But that’s not all! We will then offer 30 minute break-out sessions on hot topics warranting a deeper dive that Companies are facing when looking at their legal compliance needs. The break-out sessions will address Privacy/Data Security, Managing in the #metoo Environment and Blockchain/Cryptocurrency in business. You will be able to attend the session most relevant to your business needs.

To register for both the panel presentation and the break-out session of your choice, please click here.

Speakers
Tracy Billows, Partner, Labor and Employment
Benjamin Conley,  Partner, Employee Benefits
Erin Dougherty Foley, Partner, Labor and Employment
Sara Eber Fowler, Associate, Labor and Employment
Jason Priebe, Partner, eDiscovery and Information Governance
Michael Rechtin, Partner, Real Estate
Suzanne Saxman, Partner, Corporate
Ryan Tilot, Associate, eDiscovery and Information Governance
Jordan Vick, Partner, Litigation
Kevin Woolf, Director, Seyfarth Lean Consulting

If you have any questions, please contact Fiona Carlon at fcarlon@seyfarth.com and reference this event.

Seyfarth Shaw LLP is an approved provider of Illinois Continuing Legal Education (CLE) credit. This seminar is approved for 2.0 hours of CLE credit CA, IL, NY, NJ and TX. CLE Credit is pending for GA and VA. HR professionals: please note that the HR Certification Institute accepts CLE credit toward recertification.

On September 19, 2017, Governor Jerry Brown signed into law AB 2632, which amends California’s slack fill law, and provides manufacturers, retailers, and consumers with greater clarity regarding the requirements for packaging.

Slack fill is the empty space between the actual container capacity and the volume of the product in the container (i.e., the air in a bag of potato chips). Manufacturers and retailers may include slack fill in their products, but the question of whether slack fill is permissible turns on whether the empty space is deemed “non-functional.” “Non-functional” slack fill is impermissible because it can mislead consumers into believing they are getting more product than the package actually contains.  Continue Reading CHIP CHIP HOORAY! California Adds Exemptions to Slack Fill Law

One of the latest efforts by a municipality to address public health concerns by requiring warnings on certain products may be revived depending on the outcome of a recent rehearing before an 11-judge en banc panel of the Ninth Circuit. The en banc panel is reconsidering its 2017 decision blocking on First Amendment grounds a San Francisco ordinance that would require soda and other sugary drink sellers to provide a prominent health warning on billboard and other outdoor advertising. Continue Reading Ninth Circuit Reconsidering San Francisco Soda Health Warning

2018 Amendment to California’s Auto-Renewal Law Adds New Requirements For Promotional Offers and Cancellation Mechanisms

Often cited as one of the most aggressive efforts to curb automatically recurring charges to consumers, California’s Auto-Renewal Law (Cal. Bus. & Prof. Code § 17600 et seq.) has become a popular tool for both plaintiff’s lawyers and government regulators. The California Auto-Renewal Law (“ARL”) applies, with limited exceptions, to any arrangement in which a paid subscription or purchase agreement is automatically renewed until the consumer cancels. Continue Reading Subscription Services, Beware

In light of the recent uptick in litigation involving the decade-old Illinois Biometric Information Privacy Act (BIPA), the Illinois state legislature is now considering amending the Act to allow for business efficiency and to bring the Act back to what some believe to be its original intent. Continue Reading BIPA: Exemptions May Be On The Horizon For The Decade-Old Statute

On July 6, 2018, Leandra English, through her attorney via Twitter, announced she would be resigning from the Consumer Financial Protection Bureau (“CFPB”). In so doing, Ms. English is also dropping her lawsuit against the CFPB in which she challenged Mick Mulvaney’s status as the acting director and claimed that she was the true acting director. Ms. English attributed her resignation decision to President Trump’s nomination of Kathy Kraninger, a White House aide, to be the CFPB’s director.

Ms. English was previously promoted by then-Director Richard Cordray before his departure the day after last November’s Thanksgiving holiday. Later, during that holiday weekend, Ms. English filed suit to block President Trump’s appointment of Mr. Mulvaney as the CFPB’s acting director. In her suit, Ms. English argued that she was the rightful successor to Director Cordray and challenged the President’s authority to appoint Mr. Mulvaney under the Federal Vacancies Reform Act of 1998 (“FVRA”). Ms. English pursued the lawsuit even though the U.S. Department of Justice’s Office of Legal Counsel had issued a memorandum that concluded the president had the authority to appoint a temporary replacement since the statute provided him with the “exclusive means” to do so unless there was a supervening statute that specified otherwise.

The U.S. District Court for the District of Columbia denied relief to Ms. English over Mr. Mulvaney’s appointment. She appealed that decision to the D.C. Circuit, which appears poised to reject her claim due, in part, to her lack of standing. If the Senate confirms Ms. Kraninger’s nomination, the confirmation will moot Ms. English’s lawsuit. Although Ms. English’s decision may end that lawsuit, the CFPB faces other challenges, and several courts have found the agency’s statutory structure unconstitutional. For additional information, see our prior alerts on this issue here.

Executive Summary and Takeaway. User agreements for websites and apps have become increasingly prevalent in recent years, and courts have had to adapt traditional rules of contract interpretation to the new digital frontier. On June 25, 2018, the First Circuit reversed a district court decision enforcing an arbitration clause contained in the terms of service for the defendant’s smartphone app, finding that those terms were not sufficiently “conspicuous” for a user to know that he or she had agreed to be bound by them. The First Circuit’s decision continues a trend of judicial hostility to arbitration clauses, and is notable for its scrutiny of the record below: the court studied in minute detail the design and content of the registration screen containing a hyperlink to the terms of service—including the size, shape, color, font, and location of the hyperlink—and concluded that the link to the terms of service failed “to grab the user’s attention.” Businesses with similar user agreements governed by Massachusetts law or that could potentially apply to Massachusetts consumers should review their websites and/or apps to ensure that their platforms disclose any terms of use in a clear and conspicuous manner in relation to the rest of the content on the screen.

Additional Background. To use the services provided by the defendant company (the “Company”) via its smartphone app, a customer must first register with the Company by creating an account. As part of the registration process, users are shown a screen that requests their payment information and notifies them that by creating an account they are agreeing to the Company’s Terms of Service and its Privacy Policy:

The words “Terms of Service & Privacy Policy” are in a clickable box that includes a hyperlink. Upon clicking on that hyperlink, the user is directed to a screen with two other links: one to the Terms of Service, and the other to the Privacy Policy. The user can view either document by clicking on the appropriate link.

Continue Reading First Circuit Invalidates Arbitration Clause in Mobil App User Agreement

On June 21, 2018, in deciding a motion to dismiss a complaint brought the Consumer Financial Protection Bureau (“CFPB”)and the State of New York, Judge Loretta Preska of the U.S. District Court for the Southern District of New York held that the CFPB’s structure is unconstitutional.

Previously the D.C. Circuit, sitting en banc in PHH Corp. v. CFPB, 881 F.3d 75 (D.C. Cir. 2018), had held that Title X of the Dodd-Frank Act, which “established the CFPB as an ‘independent bureau’ within the Federal Reserve System,” was validly enacted. Judge Preska disagreed with the panel and adopted the minority view proposed by the dissent in that case. First, she accepted Judge Brett Kavanaugh’s conclusion that the CFPB was unconstitutionally structured because it is an “independent agency that exercises substantial executive power and is headed by a single Director.” Namely, Judge Kavanaugh took issue with the CFPB’s unchecked authority vested in a single director, where history, liberty, and presidential authority dictate otherwise. Continue Reading An SDNY Dilemma: CFPB Held Unconstitutional Over Director Removal Provision

In China Agritech, Inc. v. Resh, the Supreme Court recently held that pending class actions do not toll the limitations period for successive class actions. The ruling limits plaintiffs’ ability to bring successive class actions and will increase certainty for defendants sued in class actions. Continue Reading Supreme Court Rules that Class Actions Do Not Toll the Limitations Period for Successive Class Actions