19 F.4th 873
6th Cir.2021Background
- StockX is an online marketplace whose Terms of Service (TOS) have, since 2015, included an arbitration agreement, class waiver, an opt-out procedure, and (as of Oct. 9, 2018) a clear delegation clause assigning arbitrability questions to an arbitrator.
- StockX’s account-creation and login flows present hyperlinks to the TOS and state that continued use constitutes acceptance; StockX also emailed users upon revising the TOS in October 2018.
- Eight named plaintiffs sued after a May 2019 data breach affecting millions of user accounts; four plaintiffs created accounts before Oct. 2018, four after.
- StockX moved to dismiss and compel arbitration; the district court granted the motion, concluding the delegation clause required an arbitrator to decide plaintiffs’ infancy and unconscionability defenses.
- On appeal plaintiffs argued (1) the pre-2018 account-holders did not assent to the Oct. 2018 TOS, (2) minors’ infancy doctrine makes the agreement unenforceable, and (3) the arbitration and delegation clauses are unconscionable. The Sixth Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did pre‑Oct‑2018 account-holders assent to the Oct. 2018 TOS (formation/existence)? | Pre‑2018 users (M.S., Giampetro, Kissi, Bolling) say they did not agree to the revised terms. | StockX produced evidence (email notice; continued account use) showing notice and continued assent by conduct. | Court: StockX met its burden; plaintiffs produced no admissible contrary evidence. Formation/existence not in genuine dispute. |
| Does the delegation clause itself require the arbitrator to decide infancy/unconscionability? | Plaintiffs: infancy/unconscionability invalidate the entire agreement (including delegation) so the court should decide. | StockX: delegation clause clearly and unmistakably delegates enforceability issues to arbitrator. | Court: delegation clause valid and clear; whether infancy/unconscionability avoid the contract is for the arbitrator unless challenge is to the delegation clause specifically or to formation/existence. |
| Does the infancy doctrine render the contract non‑existent (so court decides arbitrability)? | Minors argue infancy voids the contract so the court should rule on arbitrability. | StockX: under severability doctrine, infancy makes contract voidable (enforceability), so arbitrator decides. | Court: under Michigan law minors’ contracts are voidable (not nullities); challenge is to enforceability of whole contract and thus for arbitrator; formation/existence was only for the court and had been decided (see assent). |
| Are plaintiffs’ unconscionability challenges sufficiently specific to the delegation clause to allow the court to decide? | Plaintiffs contend the arbitration and delegation clauses are procedurally and substantively unconscionable (adhesion, limited opt‑out, StockX’s unilateral changes). | StockX: plaintiffs failed to show arguments targeted specifically at the delegation provision. | Court: plaintiffs’ unconscionability arguments target the agreement as a whole; they did not show a specific attack on the delegation clause itself, so arbitrator must decide. |
Key Cases Cited
- Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019) (parties may delegate gateway arbitrability questions to an arbitrator if there is clear and unmistakable evidence)
- Rent‑A‑Center, W., Inc. v. Jackson, 561 U.S. 63 (2010) (court may decide only challenges specifically directed at the delegation clause; general challenges go to arbitrator)
- Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287 (2010) (courts must resolve whether an arbitration agreement was formed before sending disputes to arbitration)
- Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006) (under severability, courts decide formation; challenges to the validity of the arbitration clause are for arbitrators unless the challenge targets the arbitration clause specifically)
- Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967) (fraud-in-the-inducement of the arbitration clause itself is for courts; otherwise severability sends validity questions to arbitrator)
- Lamps Plus, Inc. v. Varela, 139 S. Ct. 1407 (2019) (parties may define issues subject to arbitration)
- VIP, Inc. v. KYB Corp. (In re Auto. Parts Antitrust Litig.), 951 F.3d 377 (6th Cir. 2020) (court decides formation/existence questions even if delegation clause purports to delegate them)
- Swiger v. Rosette, 989 F.3d 501 (6th Cir. 2021) (delegation-clause language can be clear and unmistakable; enforceability issues may be delegated)
- Blanton v. Domino’s Pizza Franchising LLC, 962 F.3d 842 (6th Cir. 2020) (AAA rules incorporation and delegation-clause analysis; courts must determine who decides arbitrability before addressing merits)