Thursday, April 11, 2013

Florida Supreme Court Reverses Decision That Found Class Action Waivers Unconscionable

In McKenzie Check Advance of Florida, LLC v. Betts (SC11-514), the Florida Supreme Court reversed a decision of the Fourth District Court of Appeal that determined a class action waiver provision violated Florida public policy. 

After the Fourth District published its opinion, "the United States Supreme Court issued its decision in AT&T Mobility, LLC v. Concepcion, 131 S. Ct. 1740, 1744 (2011), addressing the issue of whether the Federal Arbitration Act (FAA) 'prohibits States from conditioning the enforceability of certain arbitration agreements on the availability of classwide arbitration procedures.'” In Concepcion, the Supreme Court concluded the California public policy prohibiting class action waivers was preempted by the Federal Arbitration Act. 

In McKenzie, the Florida Supreme Court stated 
Applying the rationale of Concepcion to the facts set forth by the Fourth District in McKenzie, we conclude that the FAA preempts invalidating the class action waiver in this case on the basis of it being void as against public policy. Accordingly, we quash the Fourth District’s decision below. We decline to answer the certified question because it is moot in light of Concepcion. In other words, even if the Fourth District is correct that the class action waiver in this case is void under state public policy, this Court is without authority to invalidate the class action waiver on that basis because federal law and the authoritative decision of the United States Supreme Court in Concepcion preclude us from doing so.
Justice Pariente wrote the opinion for the court. Justice Quince, Justice Canady, Justice Labarga, and Justice Perry concurred. Chief Justice Polston and Justice Lewis concurred in result only.

The Florida Supreme Court's opinion can be viewed HERE.  The Fourth District's opinion, that is now quashed, can be viewed HERE.


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