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The 9th Circuit is being asked to decide whether arbitrators should decide when arbitration agreements are unconscionable. An en banc panel of 9th Circuit judges seemed to signal Tuesday that when it comes to deciding if a mandatory arbitration agreement is fair, judges — not arbitrators — should have the last word. But some judges who spoke during hour-long arguments in the closely watched case sounded wary of opening the courtroom door to litigants unhappy with arbitration. Some also wondered who should determine whether it’s unconscionable to make a Californian fly to Boston for an arbitration. This isn’t a consumer case, and “this is not Bombay,” Judge Alex Kozinski told the plaintiffs attorney, Michael Quirk of Trial Lawyers for Public Justice. “This is not Rio de Janeiro.” Quirk is hoping to overturn a March opinion by a three-judge 9th Circuit panel that said “the arbitrator must decide whether an agreement that contains an arbitration clause is a contract of adhesion.” Quirk represents Connie Nagrampa, who owned a direct mail franchise, in Nagrampa v. MailCoups, 03-15955, a dispute with franchisor MailCoups. Nagrampa says the agreement isn’t fair because the fees make it more expensive than court, and because she’d have to travel to the hearing. While Quirk was heavily questioned, the judges were particularly tough on his opposition, Glenn Plattner, a partner at Jenkens & Gilchrist in Los Angeles, who represents MailCoups. “Doesn’t it make sense,” Chief Judge Mary Schroeder asked Plattner, “that the courts should decide whether something goes to arbitration?” “Yes,” conceded Plattner, who argued that a U.S. Supreme Court precedent says arbitrators must assess the fairness of such clauses. But Judge Richard Tallman was skeptical when Quirk explained that Nagrampa initially participated in arbitration proceedings because she felt compelled to do so. “That’s one way to look at it,” Tallman said. “The other is that she wanted to see how the arbitration proceedings went, and when she realized she was losing, she filed this.” Judge Raymond Fisher, meanwhile, grilled Quirk on whether an individual clause may be considered separately from the totality of a contract. Judges Stephen Reinhardt and Fisher seemed troubled that Plattner’s reasoning would divide the chore of assessing fairness in two. “It sounds like one person is supposed to do it,” said Reinhardt. “If you’re going to have the court rule on substantive unconscionability, why not have them rule on procedural unconscionability?” he asked. After more than an hour of questions for both lawyers, Schroeder asked, “What do you want us to do? What’s the bottom line?” Quirk said he wants a rule that says courts must decide whether an arbitration contract is unfair, and to find the agreement between Nagrampa and MailCoups unconscionable because it required her to pay high fees and travel across the country for her hearings. The question of who decides disputes over an arbitration agreement’s terms is of great interest to businesses that use mandatory arbitration agreements and lawyers who oppose them. “It would be terrible if that issue were sent to the arbitrator,” said Cliff Palefsky, a San Francisco employment lawyer and outspoken critic of mandatory arbitration. Even some lawyers who typically represent business interests seeking to compel arbitration agreed. “That’s what courts are supposed to do,” said Alan Kaplinsky, a partner with Ballard Spahr Andrews & Ingersoll in Philadelphia. “They’re supposed to determine whether there’s a valid agreement to arbitrate.”

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