Can You Compel Arbitration of an FDUTPA Claim in Florida?

The Florida Deceptive and Unfair Trade Practices Act (FDUTPA) is a state law that allows consumers and businesses to seek compensation for losses caused by certain improper commercial activities. The law contains a private right of action—meaning consumers/businesses have the right to sue under the FDUTPA. This raises an important question: Can arbitration be compelled in an FDUTPA claim? The short answer is “yes”—as long as there is a properly drafted arbitration clause in a sales contract. Here, our Miami FDUTPA attorneys provide a comprehensive overview of the key things to know about compelling arbitration in a deceptive and unfair trade practices case.

A Well-Drafted Sales Contract Could Compel Arbitration of an FDUTPA Claim 

A court may require arbitration of an FDUPTA claim in Florida. A dispute that arises under the FDUTPA could be subject to mandatory arbitration if the underlying cause of action involves a written sales contract that contains a properly-drafted arbitration provision. To be clear., the enforceability of these clauses is contingent upon their clear and unambiguous language that unmistakably conveys the parties’ intent to arbitrate disputes. Courts in Florida have consistently ruled that when a sales contract contains an arbitration provision, it must be honored, unless specific legal grounds justify its invalidation. In the case of McKenzie Check Advance of Florida, LLC v. Betts, the Supreme Court of Florida required a class action FDUTPA claim to go through arbitration based on a forced arbitration clause within a sales contract.

 Florida Courts Often Uphold Arbitration Provisions—Including for FDUTPA Claims 

Similar to federal policy, Florida state policy strongly favors the enforcement of voluntarily agreed-upon arbitration clauses. Arbitration is considered to be a legitimate alternative to litigation and it is viewed as capable of providing a fair and efficient resolution of disputes, including those involving deceptive and unfair trade practices.

Arbitration Provisions May Be Challenged on Several Grounds 

While Florida courts favor upholding mandatory arbitration provisions, these clauses can absolutely be challenging. They are subject to be invalidated—and it is an especially big risk in FDUTPA claims. Here are the two main grounds upon which mandatory arbitration clauses are set aside by courts in deceptive and unfair trade practices claims in Florida:

• Inapplicable: One common challenge against the enforcement of arbitration provisions in FDUTPA claims is the argument of inapplicability. Parties opposing arbitration might argue that the dispute at hand falls outside the scope of the arbitration clause—perhaps due to the specific nature of the FDUTPA claim or the way the contract is worded.
• Fraud: In Florida, outright fraud is not subject to forced arbitration. If a party is bringing an FDUTPA claim on the grounds of fraud, an arbitration can be set aside by a Florida court.

 Call Our FDUTPA Lawyer for a Confidential Case Review

At Pike & Lustig, LLP, we help clients navigate deceptive and unfair trade practices cases. If you have any specific questions about compelling arbitration in an FDUTPA case, we are here to help. Call us today to set up your confidential, no obligation consultation. With an office in Miami and an office in West Palm Beach, our firm handles FDUTPA cases throughout Florida.

Source:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0500-0599/0501/0501PARTIIContentsIndex.html