                    FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

CONNIE A. NAGRAMPA,                      
               Plaintiff-Appellant,            No. 03-15955
               v.
                                                D.C. No.
                                              CV-03-00208-MJJ
MAILCOUPS INC.; THE AMERICAN
ARBITRATION ASSOCIATION,                         OPINION
            Defendants-Appellees.
                                         
        Appeal from the United States District Court
          for the Northern District of California
         Martin J. Jenkins, District Judge, Presiding

                  Argued and Submitted
        December 6, 2004—San Francisco, California

                      Filed March 21, 2005

  Before: Diarmuid F. O’Scannlain, Robert E. Cowen,* and
               Carlos T. Bea, Circuit Judges.

                 Opinion by Judge O’Scannlain




   *The Honorable Robert E. Cowen, Senior United States Circuit Judge
for the Third Circuit, sitting by designation.

                               3379
                NAGRAMPA v. MAILCOUPS INC.              3381


                        COUNSEL

Kate Gordon, Trial Lawyers for Public Justice, Oakland, Cali-
fornia, argued the cause for appellant; F. Paul Bland, Trial
Lawyers for Public Justice, Washington, D.C., and Sanford
M. Cipinko, San Francisco, California, were on the briefs.

Glenn J. Plattner, Jenkens & Gilchrist, Los Angeles, Califor-
nia, argued the cause for appellee MailCoups, Inc.; Christine
S. Oh, Jenkens & Gilchrist, Los Angeles, California, was on
the brief.
3382                  NAGRAMPA v. MAILCOUPS INC.
Shirley M. Hufstedler and Benjamin J. Fox, Morrison & Foer-
ster, Los Angeles, California, and John S. Warnlof, Lipton,
Warnlof & Sumnick, Walnut Creek, California, were on the
brief for appellee American Arbitration Association.


                                 OPINION

O’SCANNLAIN, Circuit Judge:

   We must decide who determines whether an agreement
containing an arbitration clause is unconscionable: the arbitra-
tor or the court.

                                       I

   After working for more than seven years in the direct mar-
keting field, Connie A. Nagrampa entered into an agreement
with MailCoups, Inc., to operate one of the company’s mail-
advertising franchises. The document that the parties signed
includes a clause requiring the arbitration of any dispute “aris-
ing out of or relating to” the franchise agreement. The clause
designates Boston, Massachusetts, as the situs for any arbitra-
tion proceedings and provides that costs will be borne equally
by each party.1 Nagrampa claims that the franchise agreement,
which she received in the mail and returned to MailCoups
with her signature, was non-negotiable, that she was not given
  1
   The arbitration clause states, in relevant part:
         Any controversy or claim arising out of or relating to this
      Agreement, or any breach thereof, including, without limitation,
      any claim that this Agreement or any portion thereof is invalid,
      illegal or otherwise voidable or void, shall be submitted to arbi-
      tration before and in accordance with the rules of the American
      Arbitration Association . . . . The situs of the arbitration proceed-
      ings shall be the regional office of the American Arbitration
      Association which is located in Boston, Massachusetts. The costs
      of arbitration shall be borne equally by MailCoups and
      [Nagrampa].
                     NAGRAMPA v. MAILCOUPS INC.                        3383
a copy of the agreement for her own records, and that Mail-
Coups did not inform her about the arbitration clause or the
costs associated with arbitration.

   Nagrampa’s mail-advertising franchise proved to be a
financial failure, and after operating the business for two
years, she unilaterally terminated the agreement in September
2000. MailCoups, which claimed that it was still owed
$80,000 by Nagrampa, responded by initiating arbitration pro-
ceedings against her with the American Arbitration Associa-
tion (“AAA”). Although Nagrampa initially participated in
the prehearing procedures, she discontinued doing so after the
arbitrator designated Boston as the location for the arbitration.
The proceedings thereafter continued without Nagrampa’s
participation.

   In the meantime, Nagrampa filed suit against MailCoups
and the AAA in California state court, alleging that Mail-
Coups was liable for common-law misrepresentation and
fraud, as well as for violating the California Consumer Legal
Remedies Act and California’s franchise and unfair competi-
tion laws. Nagrampa sought monetary damages from Mail-
Coups and an injunction preventing the company from
enforcing the arbitration clause against her.

  Invoking the parties’ diversity of citizenship, MailCoups
removed the case to federal court and then moved to compel
arbitration and to stay or dismiss the court proceedings. In
opposition, Nagrampa argued that the arbitration clause was
unenforceable on grounds of unconscionability. The district
court concluded that the agreement was valid and granted
MailCoups’ motion to dismiss.2 Nagrampa timely appealed.
   2
     The district court denied MailCoups’ motion to compel arbitration
because § 4 of the Federal Arbitration Act (“FAA”) requires that an arbi-
tration hearing take place in the district in which the motion to compel was
filed. See 9 U.S.C. § 4 (“The hearing and proceedings . . . shall be within
the district in which the petition for an order directing such arbitration is
filed.”). Relying upon the franchise agreement’s designation of Boston as
the arbitration forum, the district court concluded that the District of Mas-
sachusetts was the proper venue for MailCoups to obtain an order compel-
ling arbitration. MailCoups did not file a cross-appeal.
3384                 NAGRAMPA v. MAILCOUPS INC.
                                    II

   Under California law, the party challenging the validity of
an arbitration clause has the burden of proving unconsciona-
bility.3 See Szetela v. Discover Bank, 118 Cal. Rptr. 2d 862,
866 (Ct. App. 2002). “[U]nconscionability has both a proce-
dural and a substantive element, the former focusing on
oppression or surprise due to unequal bargaining power, the
latter on overly harsh or one-sided results.” Armendariz v.
Found. Health Psychcare Servs., Inc., 6 P.3d 669, 690 (Cal.
2000) (internal quotation marks omitted). Although both ele-
ments must be present for a court to exercise its discretion to
invalidate an agreement as unconscionable, they need not be
present in the same degree. Id. Because procedural and sub-
stantive unconscionability exist on a sliding scale, “the more
substantively oppressive the contract term, the less evidence
of procedural unconscionability is required to come to the
conclusion that the term is unenforceable, and vice versa.” Id.

   Nagrampa argues that the arbitration clause is procedurally
unconscionable because the franchise agreement in which it
is found constitutes a contract of adhesion. Before we address
the merits of this contention, however, we must determine
whether the court or the arbitrator should decide this issue.
  3
    Throughout both the lower-court and appellate proceedings, the parties
have operated on the assumption that the franchise agreement is governed
by California law. In so doing, they have neglected to make any mention
of the agreement’s Massachusetts choice-of-law clause. Notwithstanding
this oversight, we will indulge their assumption that California law gov-
erns. In light of the ultimate resolution of this appeal, Nagrampa is the
only party that could benefit from the application of Massachusetts law,
and she has waived any argument to that effect. See United States v.
Hernandez-Valdovinos, 352 F.3d 1243, 1248 n.4 (9th Cir. 2003) (“Issues
that were not presented to the district court generally cannot be raised for
the first time on appeal.”).
                 NAGRAMPA v. MAILCOUPS INC.                3385
                               A

   [1] The Supreme Court’s decision in Prima Paint Corp. v.
Flood & Conklin Manufacturing Co., 388 U.S. 395 (1967),
defines the respective roles of courts and arbitrators in decid-
ing matters of contractual validity. There, Prima Paint Corpo-
ration argued that it was not bound by the terms of a
consulting agreement because the company had been fraudu-
lently induced to enter into that agreement. Id. at 398-99. The
Court declined to reach the merits of the fraudulent induce-
ment issue and—relying upon the consulting agreement’s
arbitration clause—preserved the question for resolution by
an arbitrator. Id. at 406-07. The Court explained that, where
an agreement includes an arbitration clause, a party’s claim
that it has been fraudulently induced to enter into that agree-
ment must be referred to an arbitrator unless the claim per-
tains specifically to the making of the arbitration clause. Id.
at 403-04 (“[I]f the claim is fraud in the inducement of the
arbitration clause itself—an issue which goes to the ‘making’
of the agreement to arbitrate—the federal court may proceed
to adjudicate it. But the statutory language [of the FAA] does
not permit the federal court to consider claims of fraud in the
inducement of the contract generally.” (footnote omitted)).

   The Court’s holding was premised upon the language of § 4
of the FAA, which requires a court to compel arbitration
“upon being satisfied that the making of the agreement for
arbitration or the failure to comply therewith is not in issue,”
9 U.S.C. § 4 (emphasis added), as well as upon the general
congressional policy that arbitration should be “speedy and
not subject to delay and obstruction in the courts,” Prima
Paint Corp., 388 U.S. at 404. In light of these considerations,
“a federal court may consider only issues relating to the mak-
ing and performance of the agreement to arbitrate” when
deciding whether a party is bound by an arbitration clause;
matters that concern the larger agreement of which the arbi-
tration clause is a part must be resolved by an arbitrator. Id.
3386                 NAGRAMPA v. MAILCOUPS INC.
   Our inquiry into whether Nagrampa and MailCoups entered
into an enforceable arbitration agreement must therefore be
confined to those issues that pertain specifically to the arbitra-
tion clause’s validity. Any issues that relate to the making of
the franchise agreement as a whole must be referred to an
arbitrator.

                                    B

   [2] Our circuit has until now refrained from expressly
addressing Prima Paint’s implications for contract-of-
adhesion arguments. In Ticknor v. Choice Hotels Interna-
tional, Inc., 265 F.3d 931, 941 (9th Cir. 2001), we did con-
clude that an arbitration clause in a franchise agreement was
unconscionable because the agreement as a whole constituted
a contract of adhesion. Ticknor, however, provides no analy-
sis of whether a court or an arbitrator should properly decide
the contract-of-adhesion question. Because Ticknor did not
raise or consider the Prima Paint issue, it does not inform our
inquiry in this case.4 See United States v. Johnson, 256 F.3d
895, 916 (9th Cir. 2001) (en banc) (plurality op. of Kozinski,
J.) (a prior decision has binding effect to the extent that “it is
clear that a majority of the panel has focused on the legal
issue presented by the case before it and made a deliberate
decision to resolve the issue”); cf. United States v. Morales,
898 F.2d 99, 101-02 (9th Cir. 1990) (holding that a three-
judge panel was not foreclosed from deciding whether it had
   4
     Moreover, those decisions in which we have held that an arbitration
agreement itself constituted a contract of adhesion have all concerned
stand-alone arbitration agreements, rather than arbitration clauses that
were embedded in larger contracts. Prima Paint therefore did not bar judi-
cial consideration of these contract-of-adhesion arguments because they
pertained specifically to the making of the parties’ agreement to arbitrate.
See, e.g., Ferguson v. Countrywide Credit Indus., Inc., 298 F.3d 778, 784
(9th Cir. 2002) (holding that a stand-alone arbitration agreement signed by
an employee was procedurally unconscionable); Circuit City Stores, Inc.
v. Adams, 279 F.3d 889, 893 (9th Cir. 2002) (holding that an employer’s
Dispute Resolution Agreement was a contract of adhesion).
                 NAGRAMPA v. MAILCOUPS INC.                  3387
jurisdiction to review a district court’s refusal to depart down-
ward from the Sentencing Guidelines where a previous panel
had reached the merits of such a case without raising or con-
sidering the reviewability issue).

   [3] Although we have not until now addressed the issue,
several of our sister circuits have squarely held that Prima
Paint requires the arbitrator to determine whether an agree-
ment containing an arbitration clause is a contract of adhe-
sion. In Rojas v. TK Communications, Inc., 87 F.3d 745, 749
(5th Cir. 1996), for example, the Fifth Circuit refused to
decide whether an employment agreement that included an
arbitration clause was a contract of adhesion. The court
explained that the

    claim that the employment agreement is an uncon-
    scionable contract of adhesion is an attack on the
    formation of the contract generally, not an attack on
    the arbitration clause itself. Because [the] claim
    relates to the entire agreement, rather than just the
    arbitration clause, the FAA requires that [the] claims
    be heard by an arbitrator.

Id. (footnote omitted); see also JLM Indus., Inc. v. Stolt-
Nielsen SA, 387 F.3d 163, 170 (2d Cir. 2004) (“According to
the principle announced in Prima Paint Corp. v. Flood &
Conklin Manufacturing Co., the issue of whether the [parties’
agreement]—as opposed to the arbitration clause alone—is a
contract of adhesion is itself an arbitrable matter not properly
considered by a court.” (citation omitted)); Burden v. Check
into Cash of Ky., LLC, 267 F.3d 483, 492 n.3 (6th Cir. 2001)
(“an additional claim of Plaintiffs, that the arbitration agree-
ments are unenforceable because they were contained in con-
tracts of adhesion, also does not concern the making of the
arbitration agreements because the claim does not attack the
arbitration clause, separate from the underlying loan agree-
ments”).
3388             NAGRAMPA v. MAILCOUPS INC.
   [4] In accordance with the convincing analysis of our sister
circuits, we hold that the arbitrator must decide whether an
agreement that contains an arbitration clause is a contract of
adhesion because this issue pertains to the making of the
agreement as a whole and not to the arbitration clause specifi-
cally. This conclusion not only comports with the holding of
Prima Paint but also gives effect to “Congress’s intent to
move the parties to an arbitrable dispute out of court and into
arbitration as quickly and easily as possible.” Bushley v.
Credit Suisse First Boston, 360 F.3d 1149, 1153 (9th Cir.
2004) (internal quotation marks omitted). It accordingly rests
within the province of the arbitrator—and not within the judi-
cial purview—to resolve Nagrampa’s claim that the franchise
agreement is a contract of adhesion.

                              C

   In addition to proffering her contract-of-adhesion argu-
ment, Nagrampa also contends that the arbitration clause is
procedurally unconscionable because it is found on the
twenty-fifth page of the thirty-page franchise agreement and
she was not informed about the clause or the costs of arbitra-
tion. Prima Paint does not preclude us from considering these
additional procedural unconscionability arguments because
they pertain specifically to the arbitration clause’s validity.
388 U.S. at 404.

   [5] Nagrampa does not cite any authority for the proposi-
tion that MailCoups was required to apprise her of the exis-
tence of the arbitration clause or the costs associated with
arbitration. Indeed, California case law establishes that Mail-
Coups had no such obligation. In Brookwood v. Bank of
America, 53 Cal. Rptr. 2d 515, 519 (Ct. App. 1996), for
example, an employee sought to obtain a judicial forum for
her employment discrimination suit by claiming that she was
not aware that her new-employee paperwork included an arbi-
tration clause. The court rejected the employee’s attempt to
evade arbitration and explained that she “was bound by the
                 NAGRAMPA v. MAILCOUPS INC.                3389
provisions of the [arbitration] agreement regardless of
whether [she] read it or [was] aware of the arbitration clause
when [she] signed the document.” Id. at 520 (internal quota-
tion marks omitted; alterations in original); see also id.
(“Reasonable diligence requires the reading of a contract
before signing it. A party cannot use his own lack of diligence
to avoid an arbitration agreement.” (internal quotation marks
omitted)).

   [6] Here, MailCoups sent the franchise agreement to
Nagrampa and asked her to return it with her signature.
Nagrampa—an experienced businessperson who had worked
for more than seven years in the direct marketing field—had
ample opportunity to read the arbitration clause and to con-
sider its implications. This case is thus appreciably different
from those in which an inexperienced consumer was pres-
sured to sign an agreement without being afforded an oppor-
tunity to read or comprehend the fine print. See, e.g.,
Gutierrez v. Autowest, Inc., 7 Cal. Rptr. 3d 267, 276 (Ct. App.
2003) (holding that an arbitration clause in an automobile
lease was procedurally unconscionable where the clause was
“particularly inconspicuous,” it was “printed in eight-point
typeface[ ] on the opposite side of the signature page,” and the
consumer was not informed of the clause’s existence).
Nagrampa’s failure to read the arbitration clause—or to con-
sult a lawyer about its ramifications—does not excuse her
from complying with its terms.

                              III

  [7] Because Nagrampa’s contract-of-adhesion argument is
a matter for the arbitrator to decide—and because she is
bound by the arbitration clause even if she failed to read it—
she has not met her burden of proving that the arbitration
agreement is procedurally unconscionable. Accordingly, we
3390               NAGRAMPA v. MAILCOUPS INC.
need not reach the question of whether the agreement is sub-
stantively unconscionable.5

  AFFIRMED.




  5
    MailCoups’ request for sanctions under Fed. R. App. P. 38 is denied
because such a request must be set forth in “a separately filed motion,”
rather than in an appellate brief. Even if the request had been properly
presented, however, it would have been denied on the merits because it
cannot be said that Nagrampa’s “arguments of error are wholly without
merit.” In re George, 322 F.3d 586, 588 (9th Cir. 2003) (per curiam)
(internal quotation marks omitted).
   Because we do not reach Nagrampa’s substantive unconscionability
arguments, we deny as moot the AAA’s motion to strike and its request
for judicial notice, as well as Nagrampa’s motion requesting judicial
notice.
