[00:00:34] Speaker 01:
That provision does not mention Utah law, much less require the arbitrator to apply it.

[00:00:42] Speaker 04:
So they say the language enforces your agreement with us as they are written, incorporates Utah law into the arbitration clause.

[00:00:53] Speaker 04:
What's your response to that?

[00:01:04] Speaker 01:
clauses in a different section of the arbitration agreement which has to do the subject matter is the relationship between the arbitrator and the AAA consumer arbitration rules.

[00:01:17] Speaker 01:
It follows a sentence that says AAA rules that are inconsistent with the arbitration agreement don't apply and then goes on to say the arbitration

[00:02:00] Speaker 03:
be decided by the court.

[00:02:02] Speaker 03:
And if we are to assume that the plaintiffs are attacking the arbitration clause, that falls within the court's jurisdiction, right?

[00:02:13] Speaker 01:
Yes, but I would say that the

[00:02:28] Speaker 01:
to attack a provision that's outside the arbitration clause.

[00:02:34] Speaker 03:
Well, the arbitration, what the arbitration would do would be the contract, as opposed to the, here we have the, allegedly, that the court is deciding whether the arbitration clause is valid.

[00:02:47] Speaker 03:
Correct, Your Honor.

[00:02:49] Speaker 03:
But I understand you to be arguing, and I'm not sure it was argued the same amount below, that you're saying they're actually attacking the contract

[00:02:58] Speaker 03:
Which is something that goes to the arbitrator.

[00:03:01] Speaker 01:
Correct, that's in all three of them.

[00:03:47] Speaker 03:
So the court, if we assume that the plaintiffs are attacking the arbitration clause, then the court looks at that to decide whether there is

[00:04:06] Speaker 03:
I think I said that, I don't know, easy for me to say with my Invisalign.

[00:04:10] Speaker 03:
But that being said, assuming that the court on the procedural part of it, maybe that's okay.

[00:04:18] Speaker 03:
On the substantive part of it, the court looked at the choice of law provision in findings, substantive unconscionability, right?

[00:04:30] Speaker 03:
And you're saying that can only be looked at

[00:04:35] Speaker 01:
Yes, well, because two things.

[00:04:38] Speaker 01:
If we're looking at what law is applied in arbitration, that's set out by the separate arbitration clause in the arbitration agreement, which specifically frees the arbitrator to conduct a choice of law analysis.

[00:04:52] Speaker 03:
Could the court have found substantive unconscionability without looking at the choice of law?

[00:04:59] Speaker 03:
Because there were other, there are a couple other, there's the public injunction and the

[00:05:05] Speaker 03:
collateral.

[00:05:06] Speaker 01:
So the court itself didn't find that the public injunction aspect of it altered its analysis precisely because the public injunction aspect of it was severable in explicit accordance with the McGill decision, which says that when there's an issue of when the arbitration clause permits, the public injunction really

[00:05:37] Speaker 03:
you're asking for, that the court shouldn't have considered the trice of law.

[00:06:04] Speaker 01:
other main ground that was raised did not itself rise to substantive unconscionability because it was severable and because it permitted that claim to be heard in court.

[00:06:14] Speaker 04:
I've had the collateral estoppel, non-mutual collateral estoppel.

[00:06:18] Speaker 01:
So that issue is a red herring for two reasons.

[00:06:23] Speaker 01:
It's a matter of foreign book arbitration law that parties can agree on the collateral estoppel effect of an arbitration clause.

[00:06:30] Speaker 01:
Secondly, both

[00:06:33] Speaker 01:
California and Utah, the other two choices, recognize that that is permitted.

[00:06:40] Speaker 01:
So that dog won't hunt.

[00:06:44] Speaker 01:
So that's not an alternative basis to find substantive unconscionability.

[00:06:50] Speaker 04:
So if we agree with you about the choice of law that under VMAR, the arbitrator, decides choice of law in the first instance,

[00:07:23] Speaker 01:
If I could just address the procedural unconscionability findings, the key point that's in the record in the declarations of the plaintiffs is despite the computer glitches that they alleged caused them trouble, they were able to zoom in and read substantial portions of the contract.

[00:07:43] Speaker 01:
Plaintiff Kasin said that he saw that there was an arbitration clause.

[00:07:48] Speaker 01:
He admitted to reading up to 25 percent of the contract.

[00:07:53] Speaker 04:
plaintiff carpenter said she read up to 50 percent of the contract and then they had the glitches and then they decided to sign anyway.

[00:08:28] Speaker 01:
here is the reasonably prudent smartphone or computer user.

[00:08:33] Speaker 01:
Everybody knows, and these plaintiffs admitted that they knew that they could scale the text.

[00:08:39] Speaker 01:
So the issue is not like in a brick and mortar case where there's a printed contract that's in tiny print, and there are no alternatives to large print.

[00:08:51] Speaker 01:
That might be a reasonable rule.

[00:08:53] Speaker 01:
But here, they've admitted that they were

[00:08:59] Speaker 01:
It's not what happened here on the facts as set out in their declaration was neither oppression nor surprise.

[00:09:08] Speaker 01:
They knew exactly what had happened.

[00:09:10] Speaker 01:
They were aware that there was a glitch with the computer.

[00:09:14] Speaker 01:
When you go online and the website

[00:09:26] Speaker 01:
weren't able to read the contract because the computer site crashed.

[00:09:30] Speaker 01:
That's not surprise, and it's not oppression.

[00:09:33] Speaker 01:
If it were, then electronic commerce, the ability for a provider of services to rely on the enforceability of a signed electronic contract, would be undermined.

[00:09:44] Speaker 01:
Here, they were aware, they read the arbitration agreements,

[00:10:20] Speaker 01:
print contract case, and there was another element of unconscionability, procedural unconscionability, which was there was time pressure.

[00:10:29] Speaker 01:
It was an employment case, and the employee was, there was a guy standing over her shoulder, and he said, you've got to sign now.

[00:10:36] Speaker 01:
And then to do that with fine print that can't be read, that's a different ball game.

[00:10:41] Speaker 01:
Here, the print could be enlarged, and they knew exactly what the situation was.

[00:10:45] Speaker 01:
They knew there was problems with the computer, and chose to press on

[00:12:03] Speaker 02:
and the choice of law clause.

[00:12:45] Speaker 03:
And you have to find both procedural and substantive unconscionability, right, to not refer to arbitration.

[00:12:53] Speaker 03:
Why wasn't that error by the district court and why doesn't the district court need to consider the other issues?

[00:13:03] Speaker 02:
Three reasons.

[00:13:04] Speaker 02:
The United Circuit and Bridge Phone Capital conducted the choice of law analysis itself, didn't leave it to the arbitrator.

[00:13:26] Speaker 02:
They're talking about the substance of choice of law issues, fundamental attributes of arbitration.

[00:13:33] Speaker 02:
Well, yes and no.

[00:13:35] Speaker 02:
I mean, I think Renna Center is clear when you're challenging the arbitration clause.

[00:13:39] Speaker 02:
If you're as long as you're challenging language in the arbitration clause, you're fine.

[00:13:43] Speaker 02:
And you can also, even under Renna Center, look to language outside the arbitration clause, as long as it's applying it to the arbitration clause.

[00:13:49] Speaker 02:
And to get back to Vimar Segura and the reason why it's a prospective waiver case is so important.

[00:13:54] Speaker 02:
the standards are different.

[00:13:56] Speaker 02:
So with perspective waiver, you have to have almost near certainty that the federal right has been waived, that you can debate how much certainty you have, certainty you need to have, and the Ninth Circuit has done that debate.

[00:14:09] Speaker 04:
Isn't that one of your arguments?

[00:14:20] Speaker 04:
me is that the choice of law clause in the arbitration agreement refers to the FAA.

[00:14:25] Speaker 04:
It doesn't refer to Utah law.

[00:14:27] Speaker 04:
So you're making an interpretation of some other language in the agreement, but it's far from clear.

[00:14:32] Speaker 04:
Why wouldn't we just

[00:14:51] Speaker 04:
of law provision, which refers only to the FAA.

[00:14:54] Speaker 04:
That seems very different from a situation where there's a specific choice of law provision outside, as in Weimar, which says use Japanese law.

[00:15:34] Speaker 02:
when you tilt the scales again.

[00:15:50] Speaker 02:
arbitration to take place in Texas.

[00:15:52] Speaker 02:
And then the actual agreement outside the arbitration clause, you have this choice of law clause that says Texas law.

[00:15:58] Speaker 02:
You know, those two things combined, you're kind of biased in the outcome and saying you're going to apply Texas law.

[00:16:27] Speaker 02:
already granted him or her.

[00:16:30] Speaker 02:
And so when the arbitration clause says, you must compel compliance with the loan, and you must apply the stand-off law.

[00:16:35] Speaker 02:
And if you have to compel compliance with the loan, and the loan requires Utah law, you don't have any other choice.

[00:16:42] Speaker 04:
But, uh... Well, but, but Weimar says we wait to see what the arbitrator figures out.

[00:16:45] Speaker 04:
I mean, there it didn't say specifically Japanese law, but the court said, no, that's premature, because the arbitrator might do something different.

[00:17:02] Speaker 02:
it down, and then on top of that, Weimar again, it's a perspective, so a perspective waiver, you have to have almost certainty established.

[00:17:12] Speaker 02:
Where substantive unconscionability and procedural unconscionability, if there's any tilting against applying California law, then you can get a, you can get a conscionability established.

[00:17:22] Speaker 00:
Counsel, you know, as a district court judge, you're very connected to the people who appear in front of you, who in their right mind would

[00:17:33] Speaker 00:
borrow money at those interest rates unless they desperately needed it and didn't really care that much about the rest of the contract.

[00:17:41] Speaker 00:
They just needed the money.

[00:17:43] Speaker 00:
I mean, how are your people deceived by anything?

[00:17:46] Speaker 00:
Or that no one else would want the money.

[00:17:49] Speaker 03:
I mean, that sadly is not unheard of.

[00:18:10] Speaker 02:
You can't use an arbitration clause to waive substantive rights, and so whether they would have signed it or not doesn't affect any of the analysis.

[00:18:21] Speaker 00:
Sure, but when you talk about the font's too small or the website crashed, you know, there's ways to deal with that if you're really interested.

[00:18:32] Speaker 00:
It would be like in the old days, well, I came without my glasses, so I can't really read the

[00:18:52] Speaker 02:
as set out in Odo in the California Supreme Court and also in Pennella, it's also

[00:19:32] Speaker 03:
Everything's in the, is it the 4.5?

[00:20:03] Speaker 04:
able to read it.

[00:20:05] Speaker 02:
Right, and so there's different parts of the contract, and if you zoom in, there's different kinds of zooming, and it's not in the record of what kind of zooming there is.

[00:20:11] Speaker 02:
There's some type of zooming that scales, which is the language Mr. Leven used, where you can zoom in and all the sentences change, like sentence length.

[00:20:22] Speaker 02:
There's other kind of zooming in where you literally zoom in and you're just looking at like 10% of a small section of a page.

[00:20:35] Speaker 02:
and the website keeps crashing.

[00:21:05] Speaker 02:
movement, zoom in to the right, and then zoom out one line down and zoom in again.

[00:21:10] Speaker 02:
And so we don't have any evidence in the record as to what type of zooming that was.

[00:21:13] Speaker 02:
But yes, they did zoom in and read some parts of it.

[00:21:16] Speaker 02:
I think part of the problem is that this language, you know, you're in the

[00:21:25] Speaker 02:
out that it was, you know, at the end of one particular paragraph in the middle of the document.

[00:21:31] Speaker 02:
And so I think in terms of the factor-based analysis, it does tend to show some additional unconscionability besides the fact that the complexity issue and the surficuous waiver.

[00:21:57] Speaker 01:
You don't have to hurry.

[00:23:00] Speaker 01:
There's a couple of mentions about how the arbitration clause tilted things in favor of my client.

[00:23:10] Speaker 01:
The arbitration clause, the choice of law provision in the arbitration clause authorizes the arbitrator to make a choice of law decision, both Utah

[00:23:25] Speaker 01:
So but whether whatever choice of law analysis gets made.