FALK v. AETNA LIFE INSURANCE COMPANY, 3:19-cv-00434

Falk sued his former employer (Aetna entities) for age and disability discrimination under the ADEA, ADA, and NJLAD; defendants moved to compel arbitration.
In 2003 (and 2004) Aetna offered optional stock option grants via email, requiring employees who accepted to assent to an online Stock Incentive Plan (SIP) that included a mandatory arbitration provision.
Acceptance occurred through the UBS PaineWebber website by scrolling through the SIP, clicking "Accept," and confirming; Aetna records show Falk accepted and later exercised options.
The SIP arbitration clause waived the right to sue and included a limited discovery scheme (one fact deposition, one expert deposition, one set of ten written questions, with arbitrator discretion to allow more).
Falk argued the FAA violates the Seventh Amendment, that he never assented (no signature), and that the arbitration clause is both procedurally and substantively unconscionable (including biased forum and restrictive discovery).
The Court found a valid clickwrap acceptance under New Jersey law and declined to invalidate the arbitration clause; it granted Aetna’s motion to compel arbitration.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Falk validly agreed to arbitrate	Falk says he did not sign or explicitly assent; questions authenticity of acceptance evidence	Aetna says online clickwrap acceptance (scroll, click "Accept" and "Yes") was required to obtain/exercise the options; records show Falk accepted	Valid agreement: clickwrap acceptance binds Falk under NJ law
Procedural unconscionability / contract of adhesion	Falk: SIP was a take-it-or-leave-it adhesion contract, no meaningful choice	Aetna: participation was voluntary; employees could decline grants without penalty	Not procedurally unconscionable: ability to decline options defeats meaningful compulsion
Substantive unconscionability — alleged forum bias	Falk: arbitration forum is unfair/biased	Aetna: federal precedent disfavors presumptions of arbitration bias; rights preserved in arbitration	Court rejects bias claim based on Supreme Court precedent (e.g., Gilmer)
Substantive unconscionability — discovery limits	Falk: one-deposition/limited discovery provision impairs ability to present employment discrimination claims	Aetna: discovery limits are common in arbitration and arbitrator can permit additional discovery where necessary	Discovery provision not unconscionable because arbitrator may expand discovery and restrictions are not per se unfair

AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (Supreme Court) (federal policy favors enforcement of arbitration agreements)
Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (Supreme Court) (doubts about arbitrability resolved in favor of arbitration)
First Options of Chi., Inc. v. Kaplan, 514 U.S. 938 (Supreme Court) (state contract law governs formation of arbitration agreements)
Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (Supreme Court) (court rejects presumption that arbitration is biased and recognizes limited discovery in arbitration)
Parilla v. IAP Worldwide Servs., VI, Inc., 368 F.3d 269 (3d Cir.) (unenforceability defenses under state contract law apply to arbitration agreements)
Nino v. Jewelry Exch. Inc., 609 F.3d 191 (3d Cir.) (discussing differences in discovery and evidentiary rules in arbitration)
Century Indem. Co. v. Certain Underwriters at Lloyd's London, 584 F.3d 513 (3d Cir.) (FAA creates federal substantive law respecting arbitration agreements)
Flintkote Co. v. Aviva PLC, 769 F.3d 215 (3d Cir.) (two-step inquiry for FAA motions to compel arbitration)
Muhammed v. Cry. Bank of Rehoboth Beach Del., 912 A.2d 88 (N.J.) (factors for evaluating contracts of adhesion)
Delta Funding Corp. v. Harris, 912 A.2d 104 (N.J.) (severance of unconscionable arbitration provisions)