Law360 published an article by McGuireWoods partner Richard Beaulieu and associates Margaret Bowman and Travis Gunn examining the shift from arbitration clauses in consumer contracts to strategic, litigation-related terms, and whether these terms can govern noncontract claims.
Titled “Consumer Contract Terms Offer Cos. Arbitration Alternatives,” the July 1, 2021, article cited a company’s recent decision to remove its arbitration requirement from its terms of service as an example of how companies are changing the way they manage litigation risks. The authors maintained that consumer contracts with favorable litigation terms, such as forum selection clauses and choice-of-law provisions, provide an alternative means to manage such risks.
In addition, Beaulieu, Bowman and Gunn cautioned that although litigation-related contract terms can govern consumer contract and noncontract claims, “careful consideration should be made to ensure that the contracts are enforceable and reach consumers’ noncontract lawsuits.”