US Supreme Court prohibits class arbitration absent a contractual basis for consent | Practical Law

US Supreme Court prohibits class arbitration absent a contractual basis for consent | Practical Law

On 27 April 2010, US Supreme Court (Supreme Court) reversed the decision by the US Court of Appeals for the Second Circuit (Second Circuit) which had allowed plaintiff AnimalFeeds International Corp. (AnimalFeeds) to pursue arbitration on behalf of the proposed class of direct purchasers against several shipping companies over alleged price-fixing of parcel tanker shipping services. In Stolt-Nielsen S.A. v AnimalFeeds International Corp., the Supreme Court held that imposing class arbitration on parties without their consent conflicts with the central principle of the Federal Arbitration Act (FAA) that arbitration requires the consent of the parties.

US Supreme Court prohibits class arbitration absent a contractual basis for consent

Practical Law UK Legal Update 9-502-3756 (Approx. 3 pages)

US Supreme Court prohibits class arbitration absent a contractual basis for consent

by Practical Law
Law stated as at 27 Apr 2010USA (National/Federal)
On 27 April 2010, US Supreme Court (Supreme Court) reversed the decision by the US Court of Appeals for the Second Circuit (Second Circuit) which had allowed plaintiff AnimalFeeds International Corp. (AnimalFeeds) to pursue arbitration on behalf of the proposed class of direct purchasers against several shipping companies over alleged price-fixing of parcel tanker shipping services. In Stolt-Nielsen S.A. v AnimalFeeds International Corp., the Supreme Court held that imposing class arbitration on parties without their consent conflicts with the central principle of the Federal Arbitration Act (FAA) that arbitration requires the consent of the parties.