Are arbitration agreements that limit statutory rights enforceable? The answer is no.
Several years ago, the US Supreme Court answered this question in the negative: “a provision in an arbitration agreement forbidding the assertion of certain statutory rights” renders an arbitration agreement unenforceable. Am. Exp. Co. v. Italian Colors Rest., 570 U.S. 228, 236 (2013).
In Williams v. Medley Opportunity Fund II, 965 F.3d 229 (3d Cir. 2020), the Third Circuit recently applied this decision to an agreement limiting arbitration to tribal law. This federal court of appeals held:
By limiting the claims available to borrowers to tribal-law claims, the arbitration agreement here requires a borrower to prospectively waive claims based on any other law. Like our sister circuits, we conclude that this requirement violates public policy and renders the arbitration agreement unenforceable.
Williams, 965 F.3d at 241. Link to Medley: https://bit.ly/3xnXSGc.