Nagrampa v. MailCoups, Inc.

Nagrampa v. MailCoups, Inc.

We were lead counsel on an appeal to the Ninth Circuit, where we argued that an arbitration clause between a one-woman franchise owner in California and its national parent corporation was unconscionable, in part because it required arbitration in Massachusetts and forced the franchisee to pay more than $7,000 simply to defend herself against an action by the company. The 8-judge majority in Nagrampa v. MailCoups, Inc., held that the one-woman franchise operator in California cannot be forced to go to Boston to challenge a national company’s mandatory arbitration clause before an arbitrator in its home town. The court found that the mandatory arbitration clause is unfair must be heard locally in court. The Ninth Circuit’s decision is especially important because it makes clear that the question of whether an arbitration clause is unconscionable must be decided by a court, even if some of the factors that make the clause unconscionable also apply to the contract as a whole.

Former Public Justice Attorney Michael Quirk briefed and argued the en banc stage on the appeal, with assistance from Public Justice Attorney Paul Bland and former Public Justice Fellow Kate Gordon. Our co-counsel was Sanford M. Cipinko of San Francisco.