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Inside Irys workbench: How legal work gets done.Christian · Head of Product
Northwind Technologies, Inc.: Consumer Terms & Arbitration
My workspace · 1 member
Status
Active
Due date
Jul 2, 2026
Assignees
Sarah WhitmanDC
Publish the revised Terms before the Jul 2 release. Confirm class-waiver carve-outs.
6 Documents3 Conversations2 Notes1 Multi-Doc2 Drafts4 Insights
Documents6Upload
Customer Terms of Service, v3.docx
DOCX · 86 KB
2h ago
Existing Arbitration Clause (2023).pdf
PDF · 2 pages
2h ago
AAA Consumer Arbitration Rules.pdf
PDF · 41 pages
1d ago
Counsel Memo: Class-Waiver Enforceability.pdf
PDF · 7 pages
1d ago
View all 6 documents
Conversations3New Chat
Is our class-action waiver enforceable?
9 authorities · cite-checked
2h ago
Summarize arbitration risk across all docs
Multi-doc · 6 sources
Yesterday
Draft a delegation clause
Sent to Drafts
2d ago
View all chats
Notes & Checklists2Add Note
Pre-publication review
Checklist · 3 of 5 complete
Today
Client wants opt-out removed
Confirm enforceability impact w/ Daniel
1d ago
Tasks1 / 4New Task
Finalize class-action waiver languageJun 27
Add FAA governing-law reference
Verify FAA preemption authority (Concepcion)
Review clickwrap assent flow
Ask Irys about this matter…Send
Workbench/Northwind · Consumer terms & arbitration
DOCXCustomer Terms of Service, v3.docxPDFExisting Arbitration Clause (2023).pdfPDFAAA Consumer Arbitration Rules.pdfPDFCounsel Memo: Class-Waiver Enforceability.pdf
A client wants to put a mandatory arbitration clause with a class-action waiver in its customer terms. Is that enforceable under controlling authority, where are the limits, and how should we draft it to survive a challenge?Jul 16, 9:04 AM
Executive summary

Yes, under controlling Supreme Court precedent a mandatory, pre-dispute arbitration clause with a class-action waiver is broadly enforceable in both consumer and employment terms. The Federal Arbitration Act creates a strong federal policy favoring arbitration that preempts most state-law attempts to strike these waivers. Enforceability is not absolute: it can still fall to a general contract defense like unconscionability, and a few statutes carve specific claims out. Meticulous drafting is what makes the clause hold.

Controlling authority

The FAA makes a written agreement to arbitrate “valid, irrevocable, and enforceable” 9 U.S.C. § 2. The Court reads that to preempt state rules that obstruct arbitration, striking down California’s rule that class-waivers were unconscionable Concepcion · 563 U.S. 333, and rejected the argument that a waiver fails merely because individual claims are uneconomical to bring Italian Colors · 570 U.S. 228. The same logic reaches employment: the NLRA does not override the FAA Epic Systems · 584 U.S. 497. A waiver must be enforced as written unless a generally applicable defense invalidates the arbitration clause itself.

Limits & live challenges
  • Unconscionability. The FAA’s savings clause preserves it: a clause can still fall if it is both procedurally one-sided (buried, take-it-or-leave-it) and substantively harsh (prohibitive cost, a biased forum) 9 U.S.C. § 2.
  • Statutory carve-outs. EFASASHA lets a claimant void a pre-dispute waiver for sexual-assault or harassment claims EFASASHA · Pub. L. 117-90.
  • Effective vindication. Narrowed but alive: a clause that works a prospective waiver of a statutory right is void Italian Colors · 570 U.S. 236.
How to draft it to survive
  • Clear, conspicuous heading, “Binding Arbitration and Class Action Waiver,” set in bold or caps.
  • State the waiver expressly and recite that the FAA governs, to anchor preemption.
  • Keep procedure fair: a neutral administrator (AAA / JAMS), company-borne fees, a convenient forum.
  • Use clickwrap assent, not browsewrap: an affirmative “I agree” beside the term.
  • Add a delegation clause, a severability clause, and carve out the statutory exclusions.

Sample language for the core waiver:

“The parties agree that any dispute-resolution proceedings will be conducted only on an individual basis and not in a class, consolidated, or representative action. The parties expressly waive any right to file a class action or to seek relief on a class basis.”
Deep Research · 58 authorities reviewed, citations checked against primary sources
Can a company enforce a class-action waiver in a mandatory arbitration clause in its consumer terms of service?Jurisdiction
Citable Cases from DatabaseShow results from
Court-specific, citable decisions drawn from our comprehensive legal database. Citations are checked against the primary source.
AT&T Mobility LLC v. Concepcion
Supreme Court of the United States · 563 U.S. 333
Published
Docket
No. 09-893
Date Filed
Apr 26, 2011
Author
Scalia, J. (5–4)
Excerpt
The Federal Arbitration Act provides that an arbitration agreement “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. California’s rule classifying most class-waivers as unconscionable “stands as an obstacle” to the FAA and is therefore pre-empted.
American Express Co. v. Italian Colors Restaurant
Supreme Court of the United States · 570 U.S. 228
Published
Docket
No. 12-133
Date Filed
Jun 20, 2013
Author
Scalia, J.
Excerpt
A contractual waiver of class arbitration is enforceable under the FAA even where the plaintiff’s cost of individually arbitrating a federal claim exceeds the potential recovery. The “effective vindication” exception does not reach the mere economics of pursuing a claim.
Epic Systems Corp. v. Lewis
Supreme Court of the United States · 584 U.S. 497
Published
Docket
No. 16-285
Date Filed
May 21, 2018
Author
Gorsuch, J.
Excerpt
Arbitration agreements requiring individualized proceedings must be enforced as written. The National Labor Relations Act does not displace the Federal Arbitration Act, and its “concerted activities” clause does not confer a right to class or collective procedures.
Cambria11Tracked changes · 6
Customer Terms of Service
Northwind Technologies, Inc. · Draft v3
12.  Dispute Resolution: Binding Arbitration & Class Action Waiver

12.1Any dispute, claim or controversy arising out of or relating to these Terms shall be resolved by binding arbitration administered by the American Arbitration Association under its Consumer Arbitration Rules, and governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq.

12.2Disputes will be heard on an individual basis. The parties agree that any dispute-resolution proceedings will be conducted only on an individual basis and not in a class, consolidated, or representative action. Each party expressly waives any right to file a class action or to seek relief on a class basis.

12.3The arbitrator shall have exclusive authority to resolve any dispute relating to the interpretation, enforceability or formation of this arbitration agreement, including any claim that it is void or voidable.

12.4Nothing in this Section limits a party’s right to bring an individual action in small claims court, or to file a claim under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act.

Irys · Strengthen Terms
Added the FAA governing-law reference and a delegation clause to anchor federal preemption and route enforceability questions to the arbitrator. Concepcion · 563 U.S. 333
Northwind ToS, v1 (Original).docxvsNorthwind ToS, v2 (Revised).docx
Customer Terms of Service
Northwind Technologies, Inc. · Last updated January 12, 2024 June 18, 2026
1.  Acceptance of Terms

These Terms of Service (the “Terms”) govern your access to and use of the websites, applications and services (the “Services”) provided by Northwind Technologies, Inc.. By accessing or using the Services, you agree to be bound by these Terms.

2.  Accounts and Eligibility

You must be at least 18 years old to use the Services. You are responsible for safeguarding your account credentials and for all activity that occurs under your account.

4.  Fees and Payment

Certain Services are billed on a subscription basis. Fees are non-refundable except as required by law. We may change our fees upon thirty (30) forty-five (45) days’ notice.

12.  Dispute Resolution: Binding Arbitration & Class Action Waiver

Any dispute arising out of or relating to these Terms will be resolved by binding arbitration administered by the American Arbitration Association under its Consumer Arbitration Rules. 12.1 Any dispute, claim or controversy arising out of or relating to these Terms shall be resolved by binding arbitration administered by the American Arbitration Association under its Consumer Arbitration Rules, and governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq.

Disputes will be heard on an individual basis. 12.2 The parties agree that any dispute-resolution proceedings will be conducted only on an individual basis and not in a class, consolidated, or representative action. Each party expressly waives any right to file a class action or to seek relief on a class basis.

12.3 The arbitrator shall have exclusive authority to resolve any dispute relating to the interpretation, enforceability or formation of this arbitration agreement, including any claim that all or part of it is void or voidable.

12.4 If the class-action waiver in Section 12.2 is found unenforceable, that waiver shall be severed and any class claim shall proceed in a court of competent jurisdiction, while all individual claims proceed in arbitration.

Nothing in this Section limits a party’s right to bring an individual action in small claims court. 12.5 Nothing in this Section limits a party’s right to bring an individual action in small claims court, or to file a claim under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act.

13.  Governing Law

These Terms are governed by the laws of the State of Delaware, without regard to its conflict-of-laws principles.

v1 · Original
Customer Terms of Service
Northwind Technologies, Inc. · January 12, 2024
1.  Acceptance of Terms

These Terms of Service (the “Terms”) govern your access to and use of the websites, applications and services (the “Services”) provided by Northwind Technologies, Inc.. By accessing or using the Services, you agree to be bound by these Terms.

4.  Fees and Payment

Certain Services are billed on a subscription basis. Fees are non-refundable except as required by law. We may change our fees upon thirty (30) days’ notice.

12.  Dispute Resolution

Any dispute arising out of or relating to these Terms will be resolved by binding arbitration administered by the American Arbitration Association under its Consumer Arbitration Rules.

Disputes will be heard on an individual basis.

Nothing in this Section limits a party’s right to bring an individual action in small claims court.

13.  Governing Law

These Terms are governed by the laws of the State of Delaware, without regard to its conflict-of-laws principles.

v2 · Revised
Customer Terms of Service
Northwind Technologies, Inc. · June 18, 2026
1.  Acceptance of Terms

These Terms of Service (the “Terms”) govern your access to and use of the websites, applications and services (the “Services”) provided by Northwind Technologies, Inc.. By accessing or using the Services, you agree to be bound by these Terms.

4.  Fees and Payment

Certain Services are billed on a subscription basis. Fees are non-refundable except as required by law. We may change our fees upon forty-five (45) days’ notice.

12.  Dispute Resolution: Binding Arbitration & Class Action Waiver

12.1 Any dispute, claim or controversy arising out of or relating to these Terms shall be resolved by binding arbitration administered by the American Arbitration Association under its Consumer Arbitration Rules, and governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq.

12.2 The parties agree that any dispute-resolution proceedings will be conducted only on an individual basis and not in a class, consolidated, or representative action. Each party expressly waives any right to file a class action or to seek relief on a class basis.

12.3 The arbitrator shall have exclusive authority to resolve any dispute relating to the interpretation, enforceability or formation of this arbitration agreement, including any claim that all or part of it is void or voidable.

12.4 If the class-action waiver in Section 12.2 is found unenforceable, that waiver shall be severed and any class claim shall proceed in a court of competent jurisdiction, while all individual claims proceed in arbitration.

12.5 Nothing in this Section limits a party’s right to bring an individual action in small claims court, or to file a claim under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act.

13.  Governing Law

These Terms are governed by the laws of the State of Delaware, without regard to its conflict-of-laws principles.

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Northwind ToS, v2 (Revised).docxDOCX2.6 KB43 min agoProcessed
Northwind ToS, v1 (Original).docxDOCX2.1 KB44 min agoProcessed
Existing Arbitration Clause (2023).pdfPDF168 KB2 hours agoProcessed
AAA Consumer Arbitration Rules.pdfPDF1.2 MB1 day agoProcessed
Counsel Memo: Class-Waiver Enforceability.pdfPDF96 KB1 day agoProcessed
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EFASASHA, Pub. L. 117-90.pdfPDF240 KB2 days agoProcessed
Irys for Microsoft WordMatter context, research, redlines and cite-checked authority beside your draft.Download Add-in
Northwind ToS, v2.docxCambriaTracked changes · 1
Customer Terms of Service
Northwind Technologies, Inc. · v2
12.  Dispute Resolution: Binding Arbitration & Class Action Waiver

12.1Any dispute, claim or controversy arising out of or relating to these Terms shall be resolved by binding arbitration administered by the American Arbitration Association under its Consumer Arbitration Rules, and governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq.

12.2Nothing in this Section limits a party’s right to bring an individual action in small claims court.

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