Stolt-Nielsen Does Not Bar Associational Arbitration, 1st Cir. Affirms

BOSTON — A hair salon franchisee association is not barred by Stolt–Nielsen S.A. v. AnimalFeeds International Corp. from arbitrating breach of contract claims on behalf of its members against a franchisor, a federal appeals court has affirmed, ruling that the U.S. Supreme Court has not decided what constitutes a contractual basis for class arbitration. Fantastic Sams Franchise Corp. v. FSRO Association Ltd., No. 11-2300 (1st Cir.).

On June 27, the 1st Circuit U.S. Court of Appeals concluded that the arbitration panel should decide the issue of arbitrability.

In 2011, Fantastic Sams Regional Owners Association demanded arbitration on behalf of …