An employee sued his employer for discrimination. The employer sought to have the case removed from court by invoking an arbitration agreement that the employee had previously signed. After severing unconscionable terms from the agreement, a district court compelled arbitration of the dispute.

1. What was the legal issue in this case? What did the Court of Appeals decide?

2. What does it mean for a contract to be “unconscionable”? “Procedurally unconscionable”? “Substantively unconscionable”?

3. What was the evidence that this agreement was procedurally unconscionable? Substantively unconscionable?

4. What does it mean to “sever” illegal terms from a contract? Why did the appeals court decline to do so here?

5. What would you advise this employer to do in light of this decision? Should it redraft the language of the arbitration agreement to deal with the court’s objections or drop the whole thing?