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Zaborowski v. MHN Government Services
United States Court of Appeals for the Ninth Circuit
601 F. App’x 461 (2014)
Facts
Thomas Zaborowski (plaintiff) was an employee of MHN Government Services, Inc. (MHN) (defendant). As a condition of employment, Zaborowski signed an arbitration agreement stating that all employment disputes would be resolved by arbitration. The agreement also contained procedural rules governing the arbitration process. MHN would select three potential arbitrators for the employee to choose from for adjudications. Arbitration was required to have been initiated within six months of a claim filing. Parties were subject to filing fees, which amounted to multiple thousands of dollars. Punitive damages could not be awarded, and the substantively prevailing party’s costs would be transferred to the losing party. A dispute arose, and Zaborowski filed suit in federal district court against MHN for alleged violation of the Fair Labor Standards Act. MHN filed a motion to compel arbitration under the Federal Arbitration Act (FAA), citing its required arbitration agreement. The district court denied the motion, finding that the arbitration provision was procedurally unconscionable, that multiple terms of the provision were substantively unconscionable, and that the unconscionable provisions could not be severed from the agreement to make it enforceable. MHN appealed the district court’s denial to the court of appeals.
Rule of Law
Issue
Holding and Reasoning (Per curiam)
Concurrence/Dissent (Gould, J.)
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