“Sixth Circuit emphasizes the importance of challenging an arbitration agreement’s delegation clause to allow a court to resolve the arbitration agreement’s enforceability.”

Ellen Phillips of Squire Patton Boggs has authored this article, available at The National Law Review, discussing the Sixth Circuit’s recent 2-1 decision in In re: StockX Customer Data Security Breach Litigation. As Attorney Phillips emphasizes, the case serves as a reminder that “If one wants a court to determine whether an arbitration agreement is enforceable, they must check if there’s a delegation clause and, if so, specifically challenge it; otherwise, they’ll be left arbitrating whether they should be arbitrating.”

In this decision, as to arbitrability, the majority held that it was insufficient for attorneys representing minors with brokerage accounts to generally challenge the enforceability of the agreements based on infancy. Instead, they were required to specifically challenge the provision of the agreements delegating to arbitrators the issue of arbitrability. Finding that the minors had failed “to show that ‘the basis of [their] challenge [is] directed specifically’ to the ‘delegation provision,’” the court determined that the arbitrators–not the court–were required to address the arbitrability issue.

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