On October 29, 2018, the Supreme Court heard oral argument in the case of Lamps Plus, Inc. v. Varela. At issue in Lamps Plus is what standard should be applied in determining whether parties have agreed to submit claims to class arbitration. The arbitration agreement between Lamps Plus and one of its employees did not contain an explicit waiver prohibiting arbitration of class or collective claims. The Ninth Circuit held that the arbitration agreement was ambiguous as to whether the parties agreed to submit class claims to arbitration. The Court applied a California contract-law principle that any ambiguity is to be construed against the drafter, and therefore held that the arbitration agreement permitted arbitration of the employee’s class claims.
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