“Cheeky” Maryland Rule, Requiring Mutuality In Arbitration Agreements, Not Preempted Under Concepcion
This post has been viewed 2,280 times.
In most cases, if this blog mentions Concepcion, it means that a court has found a state statute or line of decisions is preempted by the FAA. A Maryland rule, however, recently ran the Concepcion gauntlet and survived. See Noohi v. Toll Bros., Inc., __ F.3d __, 2013 WL 680690 (4th Cir. Feb. 26, 2013).
The Maryland rule in question is that arbitration provisions must be supported by consideration independent of the underlying contract, “namely, mutual obligation,” and stems from a 2003 opinion from Maryland’s highest court: Cheek v. United Healthcare of Mid-Atlantic, Inc., 835 A.2d 656 (Md. 2003). In Noohi, both the district court and Fourth Circuit found that the arbitration clause within a purchase agreement between a developer and home buyer lacked the required mutuality under Cheek.
Read original articleTags: arbitration agreements, Maryland Rule, Preempted
Related Posts
May 19, 2014
The Fourth Circuit found this week that the Dodd-Frank Act did not override all arbitration agreements between publicly-traded...
April 23, 2014
Affirming the District Court's judgment compelling arbitration, the Fifth Circuit overrules prior precedent regarding non-signatories...
April 17, 2014
In the past year, if I wrote about “FLSA” and “arbitration” in the same post, it likely meant that another federal...
