FAA Preempts California Arbitration Agreement Rule

Agreement to Arbitrate Consumer Dispute Not Unconscionable

Metropolitan News-Enterprise
March 7, 2012

Kilgore v. KeyBank, National Association (cite as 09-16703), filed March 7, 2012, addresses the “sometimes delicate and precarious dance” between state and federal law. The Court found that the Federal Arbitration Act preempts California law in light of a California rule that arbitration agreements cannot apply to claims for injunctive relief. The agreement was not unconscionable where the arbitration clause was conspicuous and clearly pointed out the increased cost of arbitration.

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