It’s not at all evident to me why SCOTUS felt the need to grant review of in Lamps Plus, Inc. v. Varela. But it did. And the majority decision, authored by Chief Justice Roberts, did precisely what I think that everyone who looked at the case expected: it held that courts cannot find the necessary consent to class arbitration in an ambiguous arbitration clause. (See Liz’s prediction, for instance (“In my view, the issue of class arbitration has largely been hammered out.”)

Still, the case has reverberations that may be far more significant than its simple holding.

Of course, this is not the first time that SCOTUS has rejected the application of what appears to be a generally-applicable contract rule to arbitration agreements. (Most recently, the Court did so in Kindred Nursing Centers L. P. v. Clark (2017).) But the Court’s transparent elevation of the “object preemption” rule of the FAA merits attention. (By object preemption, I mean the Court’s view that state law not only cannot expressly interfere with the parties’ recourse to arbitration, but it cannot stand as an obstacle to the fundamental attributes of arbitration.)

Finally, it’s worth mentioning Justice Ginsberg’s trenchant dissent, especially in light of my recent post on mutual assent in arbitration. Basically, Justice Ginsberg recognizes the “irony of invoking ‘the first principle’ that ‘arbitration is strictly a matter of consent’ . . . to justify imposing individual arbitration on employees who surely would not choose to proceed solo.” In short, she puts her finger on a critical and increasingly significant point: boilerplate presents a “Hobson’s choice”: accept the terms and conditions offered, whether you know about them or not, or give up on the transaction. That framework may make practical sense, but it hardly amounts to “assent” in any traditional sense.

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