In a pair of recent decisions, the U.S. Court of Appeals for the Second Circuit provided significant guidance on interpretation of Financial Industry Regulatory Authority (FINRA) Rule 13204, which bars arbitration of class and collective actions and enforcement of arbitration agreements when class and collective actions are pending in most circumstances. In Cohen v. UBS Fin. Servs.,1 in an opinion authored by Judge Dennis Jacobs, a Second Circuit panel found that the rule does not prohibit enforcement of class and collective waivers.
In a companion decision also authored by Judge Jacobs issued one day earlier, another panel found that where an arbitration agreement only requires arbitration of disputes required to be arbitrated under the FINRA rules, those claims were not subject to arbitration and must be litigated in court.2
