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Arbitration Clause Case Headed to Supremes

(CN) - The Supreme Court on Thursday agreed to decide whether Managed Health Network's arbitration provision gives the company too much control over disputes and is therefore unconscionable.

A trial court refused to compel arbitration in a labor class action against Managed Health Network and MHN Government Services after finding numerous aspects of the arbitration provision unconscionable.

Besides finding the provision procedurally unconscionable because it deprived employees the chance to negotiate, the court also found substantive problems because MHN held the power to choose the arbitrator, limited the amount of time disputes could be brought and shifted costs and fees to the prevailing party regardless of ability to pay.

In an unpublished opinion filed in December 2014, a Ninth Circuit panel agreed with the trial court's findings and upheld the ruling.

Per its custom, the Supreme Court did not issue any comment in taking up MHN's case.

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