Today's news for the franchise & small biz owner

Reversing Judge Scheindlin, the 2d Circuit Ct of Appeals says that repeated failure to disclose serving as a "neutral" on a related case does not warrant vacatur of the arbitral award.

Ultimately the Supreme Court is going to have to decide this one. The score is now 5-5 with one abstaining.

In a 5-4 decision of AT&T Mobility LLC v. Concepcion, No. 09-893 (April 27, 2011),  the U.S. Supreme Court held that arbitration agreements in standard form contracts that waive the right to pursue a class action are enforceable, and that the Federal Arbitration Act, 9 U.S.C. § 1, et seq., preempts a California court ruling to the contrary. 

Congress is still considering the arbitration fairness act, which could include a provision banning mandatory arbitration in franchises.  This hasn't gained a lot of traction in the franchisee world because the thinking behind it is fundamentally misguided.