Originally from Dispute Resolution Journal

In stating that contracts to settle “by arbitration” controversies involving commerce “shall be valid, irrevocable, and enforceable,” the Federal Arbitration Act (FAA) clearly expresses a preference for arbitration over litigation. The FAA leaves the door ajar for the possibility that arbitration agreements are subject to nullification if “grounds ... exist at law or in equity for the revocation of any contract.”1 Consistent with this provision, courts have recognized a number of grounds for invalidating arbitration agreements, one of which is unconscionability arising from excessive economic power of one party.