HB Ad Slot HB Mobile Ad Slot Geoffrey A. Friedman Email617.348.3096Bio and Articles Matthew C. HurleyEmail617-348-4939Bio and Articles Find Your Next Job ! Legal Secretary / Typist Early Career Trial Attorney - Las Vegas, Nevada (Remote) Attorney Represented Bodily Injury Adjuster I, II or Sr Explore More Job Openings HB Ad Slot Fashion Nova’s Arbitration Clause Fades Away by: Geoffrey A. Friedman , Matthew C. Hurley of Mintz Friday, March 1, 2024 Related Practices & Jurisdictions Litigation Trial PracticeADR Arbitration MediationCommunications Media Internet 9th Circuit (incl. bankruptcy) Print Mail Download />i Facebook Twitter Linkedin Pinterest Reddit Facebook Messenger Email Digg Print X Buffer Flipboard Online retailers routinely include arbitration clauses in the terms of service for their website, seeking to send any consumer claims to arbitration and to eliminate a consumer’s right to file a class action lawsuit. Companies adopting this approach—and indeed, the drafters of any arbitration clause—should pay careful attention to the questions of (1) who will decide whether particular claims are subject to arbitration; and (2) the scope of any carve-outs from the arbitration provision, as the recent decision in Dembiczak v. Fashion Nova, LLC demonstrates.[1] The Dembiczak case is a putative class action alleging that Fashion Nova falsely advertised discounts on its products. After the plaintiff filed suit in federal district court, Fashion Nova sought to compel the plaintiff to arbitrate her claims based on the Terms of Service on the company’s website, which require arbitration in certain instances. Initially, the court confronted the question of which decisionmaker decides the scope of the arbitration provision, or the “arbitrability” of the dispute at hand. The court applied the long-standing rule that a court should decide this threshold question unless “there is clear and unmistakable evidence” that the parties delegated the question of arbitrability to the arbitrator. Parties often seek to delegate this question to the arbitrator by incorporating in their agreements the rules of an arbitral forum that does so, like the rules of the American Arbitration Association (“AAA”). Although Fashion Nova attempted to incorporate the AAA rules for consumers in its terms of service, the court found that the version of the AAA “rules” cited by Fashion Nova did not in fact exist. Finding Fashion Nova’s incorporation of AAA rules anything but “clear and unmistakable,” the court determined that it, and not an arbitrator, had the authority to decide whether plaintiff’s claims were subject to arbitration. The court then concluded that the plain language of Fashion Nova’s Terms of Service had a carveout for injunctive relief that removed plaintiff’s entire putative class action from the scope of the arbitration provision. The court’s decision turned primarily on language in the Terms of Service providing that “an action by a party for temporary, preliminary, or permanent injunctive relief” is one category of disputes that “shall not be subject to arbitration.” This language, the court reasoned, was more expansive than if Fashion Nova had carved out only “a claim” seeking injunctive relief. Because the plaintiff sought injunctive relief on behalf of the putative class, the court concluded that this was “an action by a party” seeking injunctive relief and denied the motion to compel arbitration. Whether or not one agrees with the court’s interpretation of the Fashion Nova arbitration provision, the decision underscores the need for precision in the drafting of any arbitration provision. With respect to providing “clear and unmistakable evidence” of intent to delegate questions of arbitrability, drafters of an arbitration provision must either (a) explicitly delegate this gateway question to the arbitrators, in the text of the arbitration provision itself; or (b) explicitly and clearly incorporate the rules of an arbitral forum that supports delegation and ensure that the cited rules continue to exist and are readily identifiable. The court’s decision also strongly suggests that, had Fashion Nova carved out “claims” or the “remedy” of injunctive relief instead of “actions” seeking injunctive relief, the outcome of the arbitration question would have been different. Expect further developments on both of these key issues as courts across the country continue to grapple with the meaning of delegation and carveout clauses of arbitration provisions. [1] 2024 U.S. Dist. LEXIS 25115 (W.D. Wa. Feb. 13, 2024). ©1994-2025 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved. Facebook Twitter Linkedin Pinterest Reddit Facebook Messenger Email Digg Print Mastodon X Buffer Flipboard HTML Embed Code Current Public Notices Post Your Public Notice Today! PUBLIC NOTICE OF ASSIGNEE SALE: Kojin TherapeuticsPublished: 3 June, 2025 PUBLIC NOTICE OF 363 SALE: WaterIQPublished: 29 May, 2025 PUBLIC NOTICE OF UCC ARTICLE 9 SALE: 600 Partners LLCPublished: 29 May, 2025 PUBLIC NOTICE OF UCC SALE: Industrial Systems Technology CompanyPublished: 28 May, 2025 PUBLIC NOTICE OF UCC ARTICLE 9 SALE: CCP Mezzanine Nashville I, LLCPublished: 28 May, 2025 PUBLIC NOTICE OF UCC ARTICLE 9 SALE: Spartan Group Holdings & Affiliated CompaniesPublished: 28 May, 2025 PUBLIC NOTICE OF DISPOSTITON OF COLLATERAL: 1800 -1818 N. 4th LLCPublished: 23 May, 2025 PUBLIC NOTICE OF UCC ARTICLE 9 SALE: TrueNorth Projects, LLCPublished: 22 May, 2025 PUBLIC NOTICE OF DISPOSITON OF COLLATERAL: Barber Directory, IncPublished: 19 May, 2025 PUBLIC NOTICE OF 363 SALE: Elmer Buchta TruckingPublished: 31 March, 2025 PUBLIC NOTICE OF UCC ARTICLE 9 SALE: PHILLIPS AMSTERDAM II LLCPublished: 31 March, 2025 Discover more public notices HB Ad Slot Current Legal Analysis California’s “Auto Renewal Law” Takes Effect on July 1 by: A.J. S. Dhaliwal , Mehul N. Madia California Assembly Advances Bill to Permit Crypto Payments under DFAL by: A.J. S. Dhaliwal , Mehul N. Madia CFPB and Pawn Store Operator to Settle MLA Suit by: A.J. S. Dhaliwal , Mehul N. Madia FDIC and Maryland End Joint Consent Orders Against Regional Bank by: A.J. S. Dhaliwal , Mehul N. Madia FTC Permanently Bans Debt Collector for UDAP and FDCPA Violations by: A.J. S. Dhaliwal , Mehul N. Madia HB Ad Slot HB Mobile Ad Slot More from Mintz CMS Sheds Light on its Timeline for Expedited RADV Audits by: Tara E. Dwyer , Bridgette A. Keller Climate Lawsuit Against German Energy Company Dismissed by Court by: Jacob H. Hupart Canada Pauses Mandatory Climate Disclosure Rules by: Jacob H. Hupart New York City's Climate-Focused Local Law 97 Upheld By New York Court of Appeals by: Jacob H. Hupart Federal Reserve Disbands Climate-Focused Internal Groups by: Jacob H. Hupart California Provides Additional Guidance on Mandatory Climate Disclosures by: Jacob H. Hupart The False Claims Act and President Trump’s DEI Executive Order: Federal Contractor Employers Must Take Notice by: Michael S. Arnold , Natashia Tidwell DOJ: ‘False Claims Act + Cybersecurity’ Is Here To Stay by: Scott T. Lashway , Karen S. Lovitch Trump Administration Will Replace the Biden Administration's Department of Labor Rule Permitting ESG Investing by: Jacob H. Hupart New York Department of Health Publishes Material Transactions Reporting Form by: Jean D. Mancheno , Cody Keetch PBM Legislation in the Reconciliation Bill is Far From Sweeping PBM Reform by: Bridgette A. Keller , Lauren M. Moldawer Trump Administration Files Statement of Interest Supporting State AG Action Against Asset Managers Accused of ESG-related Antitrust Violations by: Jacob H. Hupart CMMI Unveils New Strategic Direction: Preventive Care, Patient Empowerment, and Competition by: Rachel E. Yount Democratic Senators Launch Investigation of Major Financial Institutions Based Upon Their Retreat From Climate Policies by: Jacob H. Hupart Pennsylvania State Court Dismisses Climate Tort Litigation Against Major Fossil Fuel Companies by: Jacob H. Hupart HB Ad Slot HB Mobile Ad Slot Upcoming Events Jun 6 2025 Healthcare Insights: Navigating Change Under the New Administration Jun 9 2025 The First 100 Days and Beyond Under the New Administration | Session 4: FDA-Regulated Products, Consumer Goods and Advertising Practices Jun 10 2025 Energy Emergency: Agency Implementation of Executive Order 14156 in Permitting and Review Jun 10 2025 Update on EU Sustainability Regulations Print