Opinion ID: 1101218
Heading Depth: 2
Heading Rank: 1

Heading: The High-Water Mark

Text: In Wilson, 954 F.Supp. at 1537-40, the United States District Court for the Middle District of Alabama addressed the question whether the Magnuson-Moss Act, which provides a private right of action to consumers for breaches of express and implied warranties, precludes operation of the Federal Arbitration Act (the FAA). The district court analyzed the text of the Magnuson-Moss Act and analyzed the regulations promulgated pursuant to that Act. The district court concluded that although the Magnuson-Moss Act does not address arbitration or the FAA, that Act nonetheless precludes binding arbitration under the FAA: (1) because it provides a statutory right to bring suit for damages and other legal and equitable relief ... in a court of competent jurisdiction, 15 U.S.C. § 2310(d)(1)(A); and (2) because it allows for nonbinding informal dispute settlement mechanisms, 15 U.S.C. § 2310(a)(1). See Wilson, 954 F.Supp. at 1537-38. The district court noted that the legislative history of the Magnuson-Moss Act indicates that `[a]n adverse decision in any informal dispute settlement proceeding would not be a bar to a civil action on the warranty involved in the proceeding.' Id. at 1538 (quoting H.R. Rep. 93-1107, 93d Cong., 2d Sess. 41, reprinted in 1974 U.S.C.C.A.N. 7702, 7723). The district court further noted that the Federal Trade Commission (the FTC) had rejected a proposal to allow warrantors to require binding arbitration. Id. at 1539. After noting that no other federal court had done so, the district court, using broad language, concluded that the Magnuson-Moss Act prevented arbitration of the express-and implied-warranty claims in Wilson. Id. at 1537, 1539.