                                  PRECEDENTIAL


       UNITED STATES COURT OF APPEALS
            FOR THE THIRD CIRCUIT
                 _____________

                   No. 15-3789
                  _____________

    ARTHUR CHASSEN; DEBORAH MEREDITH;
JOEL OSTER; DENNIS SCRIMER; GLEN J. DALAKIAN;
 JACK HOFFMAN; DEBORAH HOFFMAN; KATHLEEN
COOPER; RICHARD MURPHY, individually and on behalf
       of others similarly situated; AMI FELLER,
                                      Appellants
                              v.


  FIDELITY NATIONAL FINANCIAL, INC., a Delaware
corporation; FIDELITY NATIONAL TITLE INSURANCE
            COMPANY, a California corporation;
 CHICAGO TITLE INSURANCE COMPANY, a Missouri
 corporation; THE FIRST AMERICAN CORPORATION, a
     California corporation; FIRST AMERICAN TITLE
    INSURANCE COMPANY, a California corporation;
 LANDAMERICA FINANCIAL GROUP, INC., a Virginia
    corporation; TRANSNATION TITLE INSURANCE
  COMPANY, a Nebraska corporation; LAWYERS TITLE
  INSURANCE CORPORATION, a Nebraska corporation;
STEWART INFORMATION SERVICES CORPORATION,
 a Delaware corporation; STEWART TITLE GUARANTY
    COMPANY, a Texas corporation; OLD REPUBLIC
    INTERNATIONAL CORPORATION, a Delaware
   corporation; OLD REPUBLIC TITLE INSURANCE
 GROUP, INC., a Delaware corporation; OLD REPUBLIC
NATIONAL TITLE INSURANCE COMPANY, a Minnesota
       corporation; WEICHERT TITLE AGENCY

      On Appeal from the United States District Court
             for the District of New Jersey
            District Court No. 3-09-cv-00291

      District Judge: The Honorable Peter G. Sheridan

                   Argued July 13, 2016

  Before: SMITH, ROTH, and RENDELL, Circuit Judges

                (Filed: September 8, 2016)


Esther E. Berezofsky, Esq.
Williams Cuker Berezofsky
210 Lake Drive East
Woodland Falls Corporate Park
Suite 101
Cherry Hill, NJ 08002

Mark R. Cuker, Esq.
Michael J. Quirk, Esq. [ARGUED]
Williams Cuker Berezofsky
1515 Market Street
Suite 1300

                            2
Philadelphia, PA 19102


Andrew R. Wolf, Esq.
Henry P. Wolfe, Esq.
The Wolf Law Firm
1520 U.S. Highway 130
Suite 101
North Brunswick, NJ 08902
       Counsel for Appellant



Derrick R. Freijomil, Esq.
Michael R. O’Donnell, Esq. [ARGUED]
Riker Danzig Scherer Hyland & Perretti
One Speedwell Avenue
Headquarters Plaza
Morristown, NJ 07962


Grant J. Ankrom, Esq.
Jason E. Maschmann, Esq.
Charles A. Newman, Esq.
Denton US
One Metropolitan Square
211 North Broadway, Suite 3000
St. Louis, MO 63102

Frederick W. Alworth, Esq.
Joshua R. Elias, Esq.

                               3
Gibbons
One Gateway Center
Newark, NJ 07102

Kevin M. Fee, Jr., Esq.
Gerard D. Kelly, Esq.
Sidley Austin
One South Dearborn Street
Chicago, IL 60201

Steven P. Benenson, Esq.
Porzio Bromberg & Newman
100 Southgate Parkway
Morristown, NJ 07960

      Counsel for Appellees

                     ________________

                         OPINION
                     ________________


SMITH, Circuit Judge.


      “A waived claim or defense is one that a party has
knowingly and intelligently relinquished.” Wood v. Milyard,
132 S. Ct. 1826, 1832 n.4 (2012). How, then, can a party
waive a right “in a situation in which no right existed[?]”
Ackerberg v. Johnson, 892 F.2d 1328, 1333 (8th Cir. 1989).

                              4
The answer is: it cannot. Every circuit to have answered this
question has held that “a litigant [need not] engage in futile
gestures merely to avoid a claim of waiver.” Miller v. Drexel
Burnham Lambert, Inc., 791 F.2d 850, 854 (11th Cir. 1986),
abrogated on other grounds by Gulfstream Aerospace Corp.
v. Mayacamas Corp., 485 U.S. 271 (1988). We too adopt this
position and therefore hold that futility can excuse the
delayed invocation of the right to compel arbitration.
Because we also conclude that any attempt to compel bipolar
– that is, individual – arbitration in this case prior to the
Supreme Court’s decision in AT&T Mobility LLC v.
Concepcion, 563 U.S. 333 (2011), would have been futile, we
will remand with instructions that the District Court compel
bipolar arbitration of all Plaintiffs’ arbitrable claims in
accordance with its May 14, 2015, order and this opinion.


                               I.


        Plaintiffs represent a putative class of New Jersey real
estate purchasers and refinancers who were overcharged
between $70 and $350 in fees stemming from the recording
of their deeds and mortgage instruments. Plaintiffs allege that
the settlement agents – title agents and attorneys who were, in
turn, agents of the Defendants – intentionally charged
Plaintiffs more than the county clerk charged for recording
these documents and pocketed the difference. Plaintiffs
further allege that the class claims add up to over $50 million,
exclusive of treble damages and interest.


                               5
        On January 22, 2009, Plaintiffs filed a complaint in the
U.S. District Court for the District of New Jersey alleging
both breach of contract and violation of New Jersey law. In
response, Defendants sought to dismiss a number of these
claims and raised several affirmative defenses. They did not,
however, seek to compel arbitration based on the arbitration
clauses present in their contracts with Plaintiffs. 1 While no
explanation for this inaction was given, we conclude infra
that an attempt to compel bipolar arbitration would have been
futile under prevailing New Jersey law. Because arbitration
was not sought, the case was litigated for two and a half years
with the focus primarily on class certification. In that time,
both sides conducted broad discovery and contested several
substantive motions on their merits. Plaintiffs have also
extensively documented their efforts in this case and note that
they served over 130 non-party subpoenas and spent over
$50,000 on experts before Defendants sought bipolar
arbitration.


      However, on April 27, 2011, the Supreme Court in
Concepcion held that the Federal Arbitration Act (FAA)
preempted state laws that had previously prohibited a party
from compelling bipolar arbitration in certain situations even
when it was specifically agreed to by contract. 563 U.S. at


1
  There are two arbitration clauses at issue here; some
putative class members have claims under the 1987 Owner’s
Policy while others have claims under the 1992 Loan Policy.
For purposes of this analysis, the minor differences between
the two are immaterial.
                               6
352. 2 Sensing an opportunity to ward off this potential class
action, Defendants sent a letter to Plaintiffs on June 8, 2011,
demanding enforcement of the arbitration agreements in light
of this change in the law. 3 Plaintiffs rejected this arbitration
demand and noted that the question of arbitration “might have
been an interesting issue had you thought of it two and a half
years ago when the case was filed . . . .” JA 816. Defendants
then filed a motion in the District Court to compel bipolar
arbitration on August 1, 2011. The District Court concluded

2
  It cannot be disputed that Concepcion marked a change in
our jurisprudence. See Litman v. Cellco P’ship, 655 F.3d
225, 230 (3d Cir. 2011) (“The specific question before us
remains whether the FAA preempts the New Jersey Supreme
Court’s ruling in Muhammad. As noted above, we had
previously held that, pursuant to Homa, it did not. We now
examine that decision anew and hold that Homa has been
abrogated by Concepcion and that Muhammad is preempted
by the FAA.”).
3
   The dissent characterizes Defendants’ “about-face” as a
“litigation tactic [intended] to derail the court proceedings.”
Such a characterization would seem to apply regardless of
when Defendants moved for arbitration, as arbitration by
definition derails court proceedings. In addition, deciding
whether to invoke an arbitration clause is certainly a litigation
“tactic,” but tactical decision making alone does not counsel
against enforcement of a valid arbitration agreement. Indeed,
this general disapproval of arbitration clauses has been
roundly rejected by the Supreme Court. Concepcion, 563
U.S. at 339 (explaining that the FAA reflects a “liberal
federal policy favoring arbitration.”).
                               7
that any attempt to compel bipolar arbitration prior to
Concepcion would have been futile. Accordingly, the District
Court granted the motion, stayed the case, and ordered bipolar
arbitration.


       This decision, however, led to a barrage of motions for
reconsideration that, as the District Court observed, “has
come to resemble a ping pong match between the parties.”
JA 42.      Ultimately, the District Court conducted an
evidentiary hearing and found that all but two Plaintiffs had
agreed to bipolar arbitration. Accordingly, over Plaintiffs’
strong protest, it again compelled bipolar arbitration of the
remaining claims.


       Three issues relating to this ruling were certified for
interlocutory appeal pursuant to 28 U.S.C. § 1292(b):


      (a) Whether the [District] Court’s decision to
      allow Defendants to assert the affirmative
      defense of arbitration due to a change in law
      even though a substantial period of time elapsed
      between [D]efendant[s’] answer and filing of
      the motion to assert the defense was in error; (b)
      Whether Plaintiffs’ claims against Defendants
      alleging a violation of the New Jersey
      Consumer Fraud Act, N.J.S.A. §§ 56:8-1 et
      seq., are barred; and (c) any other issues arising
      out of the District Court’s decision concerning
      the arbitration of the claims.
                              8
JA 195-96 (internal citations omitted). Because we conclude
that the District Court did not err in compelling bipolar
arbitration, we need not address any other issues on appeal. 4


                               II.


        We first consider whether, as an abstract matter, the
futility of raising bipolar arbitration as a defense should
excuse the delay in doing so. Generally, “[a] written
provision in any . . . contract . . . to settle by arbitration a
controversy thereafter arising out of such contract . . . shall be
valid, irrevocable, and enforceable, save upon such grounds
as exist at law or in equity for the revocation of any contract.”
Federal Arbitration Act, 9 U.S.C. § 2. The Supreme Court
has stated that this provision reflects a “‘liberal federal policy
favoring arbitration.’” Concepcion, 563 U.S. at 339 (quoting
Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460
U.S. 1, 24 (1983)). Thus “any doubts concerning the scope of
arbitrable issues should be resolved in favor of arbitration,
whether the problem at hand is the construction of the
contract language itself or any allegation of waiver, delay, or
a like defense to arbitrability.” Moses H. Cone, 460 U.S. at
24-25; see also Volt Info. Scis., Inc. v. Bd. of Trs. of Leland
Stanford Junior Univ., 489 U.S. 468, 476 (1989) (“There is
no federal policy favoring arbitration under a certain set of

4
  The District Court had jurisdiction pursuant to 28 U.S.C.
§ 1332(d)(2) and this Court has jurisdiction pursuant to 28
U.S.C. § 1292(b).
                                9
procedural rules; the federal policy is simply to ensure the
enforceability, according to their terms, of private agreements
to arbitrate.”). Given this strong preference to enforce
arbitration agreements, we have concluded that a party waives
the right to arbitrate “only where the demand for arbitration
came long after the suit commenced and when both parties
had engaged in extensive discovery.” PaineWebber Inc. v.
Faragalli, 61 F.3d 1063, 1068-69 (3d Cir. 1995) (internal
quotation marks and citation omitted).


        For example, in Ehleiter v. Grapetree Shores, Inc., we
held that a defendant seeking to compel arbitration may waive
the right to do so when the plaintiff demonstrates unfair
prejudice arising from the defendant’s delay in raising
arbitration as an affirmative defense. 482 F.3d 207, 223 (3d
Cir. 2007). To guide this prejudice inquiry, in Hoxworth v.
Blinder, Robinson & Co. we identified six nonexclusive
factors that courts should consider when determining if the
defense of arbitration has been waived: (1) the timeliness or
lack thereof of the motion to arbitrate; (2) the extent to which
the party seeking arbitration has contested the merits of the
opposing party’s claims; (3) whether the party seeking
arbitration informed its adversary of its intent to pursue
arbitration prior to seeking to enjoin the court proceedings;
(4) the extent to which the party seeking arbitration engaged
in non-merits motion practice; (5) the party’s acquiescence to
the court’s pretrial orders; and (6) the extent to which the
parties have engaged in discovery. 980 F.2d 912, 926-27 (3d
Cir. 1992).


                              10
        None of these cases, however, dealt with a situation in
which the prejudicial delay occurred solely because an
attempt to raise the defense of arbitration earlier would have
been futile. Accordingly, we believe that our analysis in a
futility case cannot rely solely on Hoxworth because there,
waiver was premised on the fact that the right in question
indisputably existed and could have been raised earlier.
Wood, 132 S. Ct. at 1832 (defining waiver as the known
relinquishment of a claim or defense). It makes no sense to
consider, for example, whether a party “assent[ed] to the
district court’s pretrial orders,” Hoxworth, 980 F.2d at 927,
when, at the time the orders were issued, the party had no
grounds on which it could plausibly contest them. In other
words, Hoxworth was simply not a futility case. Thus, its list
of factors for determining prejudice is ill suited for our
analysis here.


       Accordingly, we must look beyond Hoxworth to
determine whether and when futility can excuse the delayed
invocation of an arbitration clause as an affirmative defense.
In so doing, we identify three primary reasons why we
believe that adoption of the futility exception in this context is
appropriate.


       First, we believe that in the arbitration context, the
logic of our waiver analysis – in addition to its specific
factors – is undercut to the extent that the delay we are
considering was the result of futility. This suggests to us that
the standard waiver analysis should not apply in the futility
context. Cf. Moses H. Cone, 460 U.S. at 24-25 (“[A]ny
                               11
doubts concerning the scope of arbitrable issues should be
resolved in favor of arbitration, whether the problem at hand
is the construction of the contract language itself or any
allegation of waiver, delay, or a like defense to
arbitrability.”). As we noted in Hoxworth, “‘where a party
fails to demand arbitration during pretrial proceedings, and, in
the meantime, engages in pretrial activity inconsistent with an
intent to arbitrate, the party later opposing a motion to compel
arbitration may more easily show that its position has been
compromised, i.e., prejudiced.’” 980 F.2d at 926 (quoting
Price v. Drexel Burnham Lambert, Inc., 791 F.2d 1156, 1161
(5th Cir. 1986)). In other words, one of the primary
justifications for waiver is that the party attempting to raise it
as a belated defense acted inconsistently with his earlier
known right to do so. However, if an earlier attempt to assert
the defense of arbitration would have been futile, this failure
to take a futile action is not inconsistent with that defense.
See Fisher, 791 F.2d at 697 (“[T]he Fishers have failed to
demonstrate that Becker acted inconsistently with a known
existing right to compel arbitration.”). Thus, applicability of
the standard waiver analysis seems to miss the key fact that
while there may be some prejudice resulting from the delay in
raising a particular defense, that prejudice is attributable to a
change in the applicable law, not to any negligent action on
the part of either party.


       Second, we have recognized futility as an exception to
both ripeness and administrative exhaustion. See Sammon v.
N. J. Bd. of Med. Examiners, 66 F.3d 639, 641 (3d Cir. 1995)
(engaging in a “futile gesture to establish ripeness” would be

                               12
unnecessary); Berger v. Edgewater Steel Co., 911 F.2d 911,
916 (3d Cir. 1990) (“Although the exhaustion requirement is
strictly enforced, courts have recognized an exception when
resort to the administrative process would be futile.”);
Harrow v. Prudential Ins. Co. of Am., 279 F.3d 244, 249 (3d
Cir. 2002) (“A plaintiff is excused from exhausting
administrative procedures under ERISA if it would be futile
to do so.”). We see no reason why this logic would not
extend to the case at hand. Why would we require a party to
make a “futile gesture” to prevent waiver when we do not
require such gestures in other scenarios?


        Finally, as Plaintiffs’ admitted at oral argument, all
four circuits to have considered this issue have undertaken
similar analyses and come to the same conclusion. Fisher v.
A.G. Becker Paribas Inc., 791 F.2d 691, 697 (9th Cir. 1986)
(“Until the Supreme Court’s decision in Byrd, the arbitration
agreement in this case was unenforceable. Therefore, the
Fishers have failed to demonstrate that Becker acted
inconsistently with a known existing right to compel
arbitration.”); Miller, 791 F.2d at 854 (“This circuit does not
require a litigant to engage in futile gestures merely to avoid a
claim of waiver.         Thus, appellees’ failure to request
arbitration prior to the Byrd decision is irrelevant to the issue
of waiver.”); Peterson v. Shearson/Am. Exp., Inc., 849 F.2d
464, 466 (10th Cir. 1988) (“There was no requirement that
Shearson make a futile attempt to obtain arbitration on the
federal claim given the state of the law; indeed, it would be
difficult to argue that such an attempt had a basis in existing
law.”); Ackerberg, 892 F.2d at 1333 (“[W]e cannot find

                               13
waiver, the voluntary relinquishment of a known right, in a
situation in which no right existed. . . . To find that the []
defendants waived a right they did not have . . . is not only
illogical, but also would encourage litigants, in order to avoid
a finding of waiver, to file motions they knew to be futile.”).
We therefore hold that futility can excuse the delayed
invocation of the defense of arbitration.


                              III.


       We next look at the futility exception in the context of
this case. To do this, we first consider the existing bipolar
and class arbitration case law and conclude that courts have
typically treated each form of arbitration as substantively
distinct.     We therefore conclude that each can be
independently waived, thereby requiring that each receive a
separate futility analysis. We next ask what it means for the
assertion of a right to have been futile, concluding that the
appropriate test is whether assertion of that right was almost
certain to fail. Finally, we apply this framework and hold that
here, a motion to compel bipolar arbitration prior to
Concepcion was almost certain to fail.


                              A.


       Plaintiffs contend that it would not have been futile for
Defendants to have moved to enforce the arbitration clauses
prior to Concepcion. Defendants, however, assert that this is
                              14
not the proper question. Instead, they suggest that the real
question is whether they could have compelled bipolar
arbitration prior to Concepcion. 5 We agree with Defendants
that the latter question is the proper inquiry, largely because
profound differences distinguish class and bipolar arbitration.
Cf. David S. Clancy, Matthew M.K. Stein, An Uninvited
Guest: Class Arbitration and the Federal Arbitration Act’s
Legislative History, 63 Bus. Law. 55, 62 (2007) (“Class
arbitration is very different from the arbitration contemplated
by Congress when Congress passed the FAA, and it is
different in ways that plainly matter: its characteristics are the
opposite of those that impressed Congress about
arbitration.”). In Opalinski v. Robert Half International, Inc.,
we undertook a thorough review of Supreme Court and Third
Circuit cases dealing with class and bipolar arbitration. 761
F.3d 326 (3d Cir. 2014). In doing so, we concluded that
bipolar and class arbitration are distinct at a fundamental,
substantive level. They are thus not merely different
adjudicative procedures that are easily interchanged:


       [W]e read the Supreme Court as characterizing
       the permissibility of classwide arbitration not
       solely as a question of procedure or contract
       interpretation but as a substantive gateway

5
  Indeed, Plaintiffs acknowledge that “Defendants have not
sought arbitration other than on an individual basis” and at
one point in this litigation argued that the motion to compel
such arbitration should be denied because it would not allow
for class arbitration. ECF No. 221 at * 40.
                               15
      dispute qualitatively separate from deciding an
      individual quarrel.       Traditional individual
      arbitration and class arbitration are so distinct
      that a choice between the two goes, we believe,
      to the very type of controversy to be resolved.


Id. at 334. Indeed, we further noted that “[t]he [Supreme]
Court’s line of post-Bazzle opinions . . . indicates that,
because of the fundamental differences between classwide
and bilateral arbitration, and the consequences of proceeding
with one rather than the other, the availability of classwide
arbitrability is a substantive gateway question . . . .” Id. at
335 (discussing Green Tree Fin. Corp. v. Bazzle, 539 U.S.
444, 459 (2003)). Accordingly, we held that – absent clear
and unmistakable evidence of agreement to the contrary – the
court, not the arbitrator, must decide whether a contract
permits either bipolar or class arbitration. Id. at 330, 335.
       Indeed, the Supreme Court in Concepcion also
highlighted three reasons why class arbitration is
fundamentally different from bipolar arbitration. “First, the
switch from bilateral to class arbitration sacrifices the
principal advantage of arbitration—its informality—and
makes the process slower, more costly, and more likely to
generate procedural morass than final judgment.” 563 U.S. at
348. “Second, class arbitration requires procedural formality.
The AAA’s rules governing class arbitrations mimic the
Federal Rules of Civil Procedure for class litigation.” Id. at
349. “Third, class arbitration greatly increases risks to
defendants.” Id. at 350. Indeed, as Concepcion concluded,
“[a]rbitration is poorly suited to the higher stakes of class

                              16
litigation.” Id. These differences make it clear why parties,
to put it bluntly, care so much about whether the agreement to
arbitrate permits class arbitration. They also make clear why
having the right to compel class arbitration is not the same as
having the right to compel bipolar arbitration. 6 We thus part
ways with our dissenting colleague who believes that the
“dispositive question here” is whether “it would have been
futile in 2009 for [Defendants] to move to enforce the
arbitration clauses.” By so broadening the dispositive inquiry
in this case, it is no wonder she concludes that the futility
exception does not apply. Had Defendants sought to enforce
the arbitration clauses in 2009, they would have been, as we
explain below, forced into class arbitration with near
certainty. 7 Even the dissent begrudgingly acknowledges that

6
  We recognize that both Concepcion and Opalinski were
decided after this case was brought and thus were not
available to Defendants when they had to decide whether to
move for bipolar arbitration. That said, we believe that these
cases fairly summarize the rather uncontroversial position that
class arbitration differs greatly from bipolar arbitration. See
Bazzle, 539 U.S. at 459 (recognizing that parties who have
agreed to bipolar arbitration cannot be forced into class
arbitration because the two procedures are substantively
distinct); EEOC v. Waffle House, Inc., 534 U.S. 279, 289
(2002) (“[N]othing in the [FAA] authorizes a court to compel
arbitration of any issues, or by any parties, that are not
already covered in the agreement.”).           This was well
understood in 2009 when the complaint was filed.
7
  As discussed infra, the New Jersey Supreme Court made it
clear that “it [is] unconscionable for defendants to deprive
                              17
they “might not have succeeded in getting what they wanted:
individual arbitration.”      How, then, can we say that
Defendants waived the right to individual arbitration by
failing to seek to enforce an arbitration clause which almost
certainly would have resulted in class arbitration? We
believe that the right to individual arbitration is a distinct
right separate from the right to class arbitration. We therefore
hold that – whether or not class arbitration was permissible –
a court must also determine whether it would have been futile
to move for bipolar arbitration under the prevailing law. We
turn, then, to that question.


                              B.


        To determine whether Defendants’ motion to compel
bipolar arbitration would have been futile, we must first
define futility as understood in this context. Other courts to
address this issue have concluded that futility does not mean
something is absolutely impossible; nor does it mean
something is merely improbable. See generally Garcia v.
Wachovia Corp., 699 F.3d 1273, 1279 (11th Cir. 2012) (“The
more lenient unlikely-to-succeed standard . . . would only
encourage litigants to delay moving to compel arbitration
until they could ascertain how the case was going in federal
district court.” (internal citations and quotation marks
omitted)). Instead, when asking whether arbitration would

[plaintiff] of the mechanism of a class-wide action, whether
in arbitration or in court litigation.” Muhammad, 189 N.J. at
22.
                              18
have been futile, courts ask whether “it was almost certain
. . . that a motion to compel arbitration would have been
denied.” Id. (emphasis added); see also Miller, 791 F.2d at
854 (“[A]ny motion to compel arbitration would almost
certainly have been futile.”); Peterson, 849 F.2d at 466
(“Because Shearson almost certainly could not have obtained
an order for arbitration of the Rule 10b-5 claim prior to
McMahon, it did not waive its right to arbitrate the claim.”). 8


       We agree, which requires us to ask whether a motion
to compel bipolar arbitration filed by Defendants prior to
Concepcion was almost certain to fail. We hold that it was.
Then-existing New Jersey law prohibited courts from
compelling bipolar arbitration in a certain subset of adhesive
consumer contracts. Muhammad v. Cty. Band of Rehoboth
Beach, DE, 189 N.J. 1 (2006). Because we conclude that the
contracts here fall within the subset of contracts for which
compelled     bipolar    arbitration   would have been
unconscionable under Muhammad, we hold that any attempt


8
  We see no conflict between the “almost certain to fail”
standard and the Eighth Circuit’s position that waiver is
appropriate if “it should have been clear . . . that the
arbitration agreement was at least arguably enforceable.” Se.
Stud & Components, Inc. v. Am. Eagle Design Build Studios,
LLC, 588 F.3d 963, 967 (8th Cir. 2009). If an arbitration
clause is not at least arguably enforceable, it is almost certain
to fail. These are, if not essentially the same standard,
logically parallel.
                               19
to seek bipolar arbitration in this case prior to Concepcion
was almost certain to fail.


        In Muhammad, the New Jersey Supreme Court held
that “it was unconscionable for defendants to deprive
Muhammad of the mechanism of a class-wide action, whether
in arbitration or in court litigation.” 189 N.J. at 22. This was
because “[t]he public interest at stake in [the plaintiff’s]
ability and the ability of her fellow consumers effectively to
pursue their statutory rights under this State’s consumer
protection laws overrides the defendants’ right to seek
enforcement of the class-arbitration bar in their agreement.”
Id. Specifically, the court considered “the small amount of
damages being pursued in this action involving complicated
financial arrangements and multiple out-of-state entities.” Id.
It then went on to note that the small value of each claim – at
most $600 – would make it difficult to pursue individually,
even if recovery of attorney’s fees were permitted. Id. at 21
(“One may be hard-pressed to find an attorney willing to
work on a consumer-fraud complaint involving complex
arrangements . . . when the recovery is so small.”).
Accordingly, the court concluded – after performing a fact
intensive inquiry – that in a certain subset of adhesive
contracts, a consumer cannot be compelled to submit to
bipolar arbitration. This was primarily because the court
concluded that individual plaintiffs were frequently
discouraged from asserting meritorious claims by the
relatively high costs inherent in doing so. Thus, as a policy
matter, the court concluded that consumers in such situations


                              20
could not be forbidden from pursuing their claims in a class
setting. Id.


        Three years later in Homa v. American Express Co.,
we also confirmed that this New Jersey policy was not
preempted by the FAA. 558 F.3d 225 (3d Cir. 2009). In
Homa, a putative class of consumers alleged that American
Express misrepresented the terms of the rewards program for
one of its credit cards. 558 F.3d at 227. Like Muhammad,
the claims at issue in Homa were small claims that were not
generally worth litigating on an individual basis. Id. The
District Court in Homa, however, held that despite
Muhammad, American Express could compel bipolar
arbitration by enforcing the class arbitration waiver provision
in its contracts. Id. at 230-231. We read Muhammad
differently and reversed. First, we noted that the District
Court placed too much emphasis on language in Muhammad
explaining that class-arbitration waivers are not per se
unenforceable. Id. at 230. We concluded that this focus on
the lack of a per se rule inappropriately minimized the
broader applicability of Muhammad and its conclusion that
certain contracts barring class arbitration violated New
Jersey’s public policy against exculpatory clauses. Id.
Second, we compared the facts of Homa to those in
Muhammad and concluded that


      the contract at issue [in Homa] bears the
      hallmarks of a contract of adhesion—it was
      presented on a take-it-or-leave-it basis, . . . in a
      standardized printed form, without opportunity
                              21
       for the adhering party to negotiate except
       perhaps on a few particulars and, as Appellant’s
       underlying claim implicates less than five
       percent of a cardholder’s overall credit card
       balance, predictably involves a small amount of
       damages . . . . [Thus,] the District Court should
       have denied the 12(b)(6) motion and concluded
       that, in light of Muhammad, at this stage the
       class-arbitration waiver at issue violates New
       Jersey’s fundamental public policy.


Id. at 231. Thus, “we h[e]ld that, if the claims at issue are of
such a low value as effectively to preclude relief if decided
individually, then, under Muhammad, . . . the class-arbitration
waiver is unconscionable.” 9 Here, however, because we
9
  In a concurring opinion, Judge Weis also discussed some of
the specific factors that New Jersey courts seemed to focus on
when determining if a contract is unconscionable. This list,
too, makes it clear that one of the key factors is the relatively
small value of the individual claims: “[m]atters bearing on the
Court’s appraisal included the lawsuit’s complexity, the
amount of damages involved, and the availability of
attorneys’ fees and statutory multipliers. The size of potential
damages was considered to be an important consideration and
was used to limit the holding to ‘low-value’ cases.” Homa,
558 F.3d at 233. He did, however, express some doubt about
our ability to determine with certainty how the New Jersey
Supreme Court would rule if confronted with this case, and
thus explained that the District Court should perform a more
in depth application of Muhammad on remand. Id. at 233-34.
                               22
know the value of the individual claims, we need not require
the District Court to conduct further inquiry into this issue on
remand.


       Applying Homa and Muhammad, we must undertake a
fact specific inquiry into whether the contracts in this case
have the same characteristics as those discussed above. See
Rudbart v. N. Jersey Dist. Water Supply Comm’n, 605 A.2d
681, 687 (N.J. 1992) (“[I]n determining whether to enforce
the terms of a contract of adhesion, courts have looked not
only to the take-it-or-leave-it nature or the standardized form
of the document but also to the subject matter of the contract,
the parties’ relative bargaining positions, the degree of
economic compulsion motivating the ‘adhering’ party, and
the public interests affected by the contract.”). If so, we can
confidently conclude that any attempt by the Defendants to
compel bipolar arbitration – and “deprive [Plaintiffs] of the
mechanism of a class-wide action, whether in arbitration or in
court litigation,” Muhammad, 189 N.J. at 22 – was almost
certain to fail.


       In doing so, we conclude that the contracts here
contain the same characteristics as those in Muhammad and
Homa. Therefore, a New Jersey court confronted with this
case in 2009 would almost certainly have found Muhammad
controlling and would have denied Defendants’ motion to
compel bipolar arbitration. Specifically, we highlight three
key similarities. First, the value of the individual claims in
this case are small, between $70 and $350; the claims in
Muhammad were all for less than $600. This suggests that it
                              23
would be, in most cases, impractical to bring an individual
claim for relief. See Delta Funding Corp. v. Harris, 912 A.2d
104, 115 (N.J. 2006) (“Harris has adequate incentive to bring
her claim as an individual action. Not only are her damages
substantial, but the fact that her home is at stake in the
foreclosure proceeding makes it likely that she would contact
an attorney. The same cannot be said of low-value claims
where individuals have little, if any, incentive to seek out an
attorney.”). Second, there is little doubt that these contracts
are adhesive consumer contracts; they were presented on a
“take-it-or-leave-it basis, commonly in a standardized printed
form, without opportunity for the ‘adhering’ party to
negotiate except perhaps on a few particulars.” Muhammad,
189 N.J. at 15. 10 Finally, it is likely that here, “without the
availability of a class-action mechanism, many consumer-
fraud victims may never realize that they may have been
wronged.” Id. at 20. Most consumers would lack the
necessary motivation to spend time looking into the costs
associated with filing records in their county. Because these

10
   We recognize that Plaintiffs had the option to augment a
few specific terms in the contract by, for example, asking for
a pre-printed Arbitration Endorsement which would have
required both parties to consent to arbitration. Based on the
evidence presented to the District Court, this option was
rarely, if ever, requested. Nonetheless, the ability to exercise
this option in a real estate closing hardly provides support for
the position that this is anything but a contract of adhesion.
Indeed, Muhammad recognized that the ability to negotiate
“on a few particulars” does not prevent a contract from being
adhesive. 189 N.J. at 15.
                              24
similarities all evidence the same unconscionability concerns
highlighted in Muhammad, we hold that any attempt by
Defendants to compel bipolar arbitration prior to Concepcion
would almost certainly have failed. 11


       Indeed, even the Plaintiffs at one point argued that
under Muhammad, the contracts here would be
unconscionable if read to prohibit class arbitration and
compel bipolar arbitration. In a section of Plaintiffs’ response
to Defendants’ motion to compel arbitration that is aptly titled
“Under New Jersey Law Chosen by Defendants, a
Requirement of Individual Arbitration of Plaintiffs’ Claims
Would be Unconscionable,” the Plaintiffs explained that
“[t]he factors identified by the Court in Muhammad as
rendering the class action ban unconscionable are present
here to the extent Defendants invoke their arbitration clause
solely in order to prohibit any class action.” Pl.’s Br. in Opp.


11
   While we readily acknowledge the concerns which the New
Jersey Supreme Court has suggested necessitate a finding of
procedural unconscionability, we need not opine on the public
policy considerations inherent in deciding whether to enforce
similar arbitration clauses because Congress has already made
this difficult decision. As the Supreme Court made clear in
Concepcion, “[t]he principle purpose of the FAA is to ensure
that private arbitration agreements are enforced according to
their terms.” 563 U.S. at 344. And because the Supreme
Court has decided that the FAA preempts contrary state law,
we need not address this issue further.
                              25
to Joint Mot. to Stay, ECF No. 221 at *39. 12 While not
giving this inconsistency any real weight, we simply note its
existence.

12
   This further highlights the key error the dissent makes
when suggesting that the lack of a class arbitration waiver
meaningfully distinguishes this case from Muhammad. The
dissent argues that in our case, it is unlikely that a New Jersey
court would have held the arbitration clauses unconscionable
because the clauses could have been read to permit class
arbitration (due to their lack of a class-arbitration waiver).
While this is true, the right question to ask when assessing
futility here is not whether the arbitration clauses, as a whole,
would have been unconscionable. The question is whether a
motion to compel bipolar arbitration would have been futile
prior to Concepcion. Indeed, practically speaking, the
dissent’s approach to futility would lead to an absurd outcome
in this case. In order to prevent waiver of Defendants’ now-
existing right to compel bipolar arbitration, Defendants’
lawyers would have had to seek to enforce an arbitration
agreement that they knew – or should have known – would
almost certainly be read to allow Plaintiffs to arbitrate as a
class. Accordingly, had they pursued arbitration in 2009,
they would have been exposing their clients to the very real
possibility that a multi-million dollar class action case would
be decided by an arbitral panel; a procedural outcome far less
preferable for Defendants than a class action in federal court.
See generally Concepcion, 563 U.S. at 350 (“Arbitration is
poorly suited to the higher stakes of class litigation.” );
Jonathan R. Bunch, To Be Announced: Silence from the
United States Supreme Court and Disagreement Among
                               26
                              IV.

       We next address two minor issues. First, having
concluded that the futility exception applies, we go on to
excuse the pre-Concepcion delay and analyze the post-
Concepcion delay under Hoxworth. Second, we consider the
scope of the arbitration clauses here and conclude that their
breadth makes it clear they encompass the New Jersey
Consumer Fraud Act (NJCFA) claims that are contested on
appeal.

                              A.

       Because any attempt to compel bipolar arbitration in
this case prior to Concepcion was almost certain to fail, we
will disregard Defendants’ pre-Concepcion delay 13 when

Lower Courts Suggest an Uncertain Future for Class-Wide
Arbitration, 2004 J. DISP. RESOL. 259, 272 (2004) (explaining
that class arbitration often seems to “bring[] the burdens of
litigation into the arbitral forum” without bringing any of the
benefits along with it). It would be a cruel joke to tell
Defendants that they waived their right to bipolar arbitration
by not seeking to enforce an arbitration agreement that would
have almost certainly led to class arbitration.
13
  The length of the delay itself – if excused under the futility
exception – is not relevant to our inquiry. Yet even were we
to consider it, we note that delays of a similar length have
been excused by the Eighth and Eleventh Circuits. See
Benoay v. Prudential-Bache Sec., Inc., 805 F.2d 1437, 1440
(11th Cir. 1986) (“Despite the fact that Bache and Stark’s
motion to compel arbitration was made two and one-half
                              27
determining whether waiver is appropriate. See Miller, 791
F.2d at 854 (“Subsequent to [the relevant change in the law],
appellees delayed only two and a half months in making their
request. Much of that delay is attributable to consolidation of
the cases and appellant’s filing of an amended complaint. In
light of these facts, we find no waiver of the right to
arbitrate.”). 14 Plaintiffs also do not claim that they suffered
any additional unfair prejudice apart from the costs associated
with maintaining and prosecuting this case prior to
Concepcion. See generally Fisher, 791 F.2d at 698 (“The
Arbitration Act requires district courts to compel arbitration
even where the result would be the possibly inefficient
maintenance of separate proceedings in different forums.”). 15


years after initiation of the civil action, we conclude that the
motion was timely in light of a change in law affecting the
parties’ rights.”); Nesslage v. York Sec., Inc., 823 F.2d 231,
234 (8th Cir. 1987) (excusing two year delay).
14
   We also believe that our decision to excuse the delay and
its resulting expense to Plaintiffs here is supported by the
“‘liberal federal policy favoring arbitration.’” Concepcion,
563 U.S. at 339 (quoting Moses H. Cone, 460 U.S. at 24).
We therefore leave it to courts in future cases to decide
whether and how to apply futility outside of the arbitration
context.
15
  In In re California Title Insurance Antitrust Litigation, No.
CIV. 08-1341, 2011 WL 2566449 (N.D. Cal. June 27, 2011),
a case practically identical to ours, Judge White concluded
that the delay resulting from the belated invocation of
arbitration as a defense was not unfairly prejudicial despite
                              28
       Because we fully excused the pre-Concepcion delay,
we consider only whether Defendants’ approximately three-
month delay between April 27, 2011 (when Concepcion was
decided) and August 1, 2011 (when Defendants filed their
motion to compel arbitration) was prejudicial to Plaintiffs. In
doing so, we look to the Hoxworth factors outlined supra for
guidance and conclude that waiver would be inappropriate for
three reasons. First, Defendants notified Plaintiffs on June 8,
2011 – just over a month after Concepcion was decided – that
they were demanding bipolar arbitration. This promptly put
Plaintiffs on notice that a motion for arbitration was coming if
the demand was rejected. Second, only three months passed

the fact that the case had been going on for over three years.
Specifically, he noted, “[t]here is nothing in the record to
support Plaintiffs’ conclusory contention that granting the
motion to compel arbitration would unfairly prejudice
Plaintiffs.” Id. at *3 (internal citations and quotation marks
omitted). He then noted that the trial date was still over a
year away and that only limited substantive discovery had
taken place. We too are not convinced by Plaintiffs’
allegations of prejudice here and, in light of the FAA’s strong
policy favoring arbitration, reject the argument that the
litigation costs associated with a delay in this case can alone
qualify as sufficient unfair prejudice to prevent application of
the futility exception. Cf. Martin v. Yasuda, No. 15-55696,
slip op. at *13 (9th Cir. July 21, 2016) (“A determination of
whether ‘the right to compel arbitration has been waived must
be conducted in light of the strong federal policy favoring
enforcement of arbitration agreements.’” (quoting Fisher, 791
F.2d at 694)).
                              29
between the accretion of the right and Defendant’s motion to
compel arbitration. This is not an unreasonable amount of
time. Third, virtually no substantive or procedural litigation
occurred during this delay. Hoxworth, 980 F.2d at 926-27. 16

                               B.

        Finally, we note that the broad scope of the arbitration
clauses here make it clear that we do not need to reach the
viability of Plaintiffs’ NJCFA claims. 17 The 1987 Owner’s
Policy states that “arbitration shall decide any matter in

16
    We also summarily reject Plaintiffs’ argument that the
Arbitration Endorsement was a mandatory addendum to every
title insurance contract at issue here. Not only are the District
Court’s findings on this issue compelling, but we are also
reviewing the court’s factual findings for clear error, despite
Plaintiffs attempt to dress up their argument as a matter of
law by suggesting that the District Court ignored probative
evidence. See N. River Ins. Co. v. CIGNA Reinsurance Co.,
52 F.3d 1194, 1218 (3d Cir. 1995). The District Court here
properly considered and weighed the competing evidence and
found the Defendants’ position more compelling. This was
not clearly erroneous.
17
  The scope of an arbitration clause is decided by the court
absent clear and unmistakable evidence that the parties agreed
to submit this issue to the arbitrator. First Options of
Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995);
CardioNet, Inc. v. Cigna Health Corp., 751 F.3d 165, 171 (3d
Cir. 2014). We find no language in the contracts suggesting
an intent that this issue be submitted to the arbitrator.
                               30
dispute between you and the Company,” while the 1992 Loan
Policy states that “[a]rbitrable matters include, but are not
limited, to any controversy or claim between the company
and the insured arising out of or relating to the policy . . . .”
JA 33. As we held in CardioNet, when the plain language of
an arbitration clause is clear, it controls. 751 F.3d at 173. We
went further, however, and also concluded that if the
language of the contract is ambiguous, “the presumption of
arbitrability applies” because “[w]e must resolve ‘any doubts
concerning the scope of arbitrable issues . . . in favor of
arbitration.’” Id. (quoting Moses H. Cone, 460 U.S. at 24-
25). Thus, we have no doubt that the NJCFA claims raised
here are subject to arbitration.

                               V.

       For the reasons previously articulated, we will remand
this case to the District Court with instructions to compel
bipolar arbitration of Plaintiffs’ arbitrable claims in
accordance with the District Court’s May 14, 2015, order and
this opinion.




                               31
      Chassen v. Fidelity National Financial, Inc. et al.

                         No. 15-3789



RENDELL, Circuit Judge, dissenting:

       The majority’s opinion is flawed for a clear and
obvious reason: it relies on caselaw that has no application
here. Therefore, I must respectfully dissent.

        In Muhammad v. County Bank of Rehoboth Beach, the
New Jersey Supreme Court held that “the presence of the
class-arbitration waiver in Muhammad’s consumer arbitration
agreement render[ed] that agreement unconscionable.” 912
A.2d 88, 100 (N.J. 2006). Yet, despite the lack of a class
arbitration waiver in the arbitration clauses here, the majority
holds that a New Jersey court in 2009, at the outset of this
case, would have found Muhammad controlling here. I reject
that view, and urge you to read Muhammad and the actual
arbitration clauses at issue here. Doing so will lead inexorably
to one conclusion: this case is not Muhammad, and a motion
by the Defendants in 2009 to compel arbitration thus would
have been anything but futile. Moreover, the majority has
expanded the concept of futility beyond what we as a court
should recognize.

       In Muhammad, the New Jersey Supreme Court
considered whether to compel arbitration under an arbitration
agreement in a payday loan contract that in no uncertain
terms prohibited class arbitration. Specifically, in multiple
places, the agreement required Muhammad to resolve all




                               1
disputes related to her payday loan transaction “by binding
individual (and not class) arbitration.” Id. at 92. The court
held these waivers unconscionable under New Jersey law.
According to the court, by forcing Muhammad to waive class
arbitration in her case, which involved a small amount of
damages, the arbitration agreement operated as an
exculpatory clause, effectively releasing the lender from
liability for possible statutory violations. See id. at 99–101.

        Unsurprisingly, then, courts applying New Jersey law
considered Muhammad to be relevant only when analyzing
the unconscionability of class arbitration waivers. In Homa v.
American Express Co., for example, we examined an
arbitration provision in a consumer agreement that required
all claims to “be arbitrated on an individual basis . . . [with]
no right or authority for any Claims to be arbitrated [as] a
class action.” 558 F.3d 225, 227 (3d Cir. 2009). After
comparing this class arbitration waiver to the “similar class-
arbitration waiver” at issue in Muhammad, we deemed it
unconscionable under New Jersey law. Id. at 230–31; see
also, e.g., Cohen v. Chase Bank, N.A., 679 F. Supp. 2d 582,
595 (D.N.J. 2010) (holding that the “the present class-action
waiver” is unconscionable under Muhammad); Davis v. Dell,
Inc., No. 07-630 (RBK), 2008 WL 3843837, at *4 (D.N.J.
Aug. 15, 2008) (“This Court finds that this case is
distinguishable from Muhammad, and the class action waiver
does not act as an unconscionable exculpatory clause.”).

       Here, the arbitration clauses—which are situated in the
Loan Policies and the Owners’ Policies—lack any sort of
class arbitration waiver. The Loan Policies provide:




                               2
       Unless prohibited by applicable law, either the
       Company or the insured may demand
       arbitration pursuant to the Title Insurance
       Arbitration Rules of the American Arbitration
       Association. Arbitrable matters may include,
       but are not limited to, any controversy or claim
       between the Company and the insured arising
       out of or relating to this policy, any service of
       the Company in connection with its issuance or
       the breach of a policy provision or other
       obligation. All arbitrable matters when the
       Amount of Insurance is $1,000,000 or less shall
       be arbitrated at the option of either the
       Company or the insured. All arbitrable matters
       when the Amount of Insurance is in excess of
       $1,000,000 shall be arbitrated only when agreed
       to by both the Company and the insured.
       Arbitration pursuant to this policy, and under
       the Rules in effect on the date the demand for
       arbitration is made or, at the option of the
       insured, the Rules in effect at Date of Policy,
       shall be binding upon the parties.

J.A. 3981. And the Owners’ Policies provide: “If it is
permitted in your state, you or the Company may
demand arbitration. The arbitration shall be binding on
both you and the Company. The arbitration shall
decide any matter in dispute between you and the
Company.” J.A. 3997. These clauses, quite obviously,
do not even mention class arbitration, let alone outright
prohibit it. If the Defendants had sought individual
arbitration at the outset of the case, this silence might
have been interpreted to mean that the parties simply




                               3
did not contemplate class arbitration. Or it might have
been construed as permitting class arbitration. 1 Surely,
it would not have been futile for them to move to
enforce these clauses at that time.

        Because the arbitration clauses here sit far
outside the reach of Muhammad, as they are devoid of
a class arbitration waiver, “‘it should have been clear
to the [Defendants in 2009] that the arbitration
agreement[s] w[ere] at least arguably enforceable.’”
Garcia v. Wachovia Corp., 699 F.3d 1273, 1278 (11th
Cir. 2012) (quoting Se. Stud & Components, Inc. v.
Am. Eagle Design Build Studios, LLC, 588 F.3d 963,
967 (8th Cir. 2009)). Indeed, the Defendants have cited
not one case—let alone any controlling precedent in
2009—in which a court applied Muhammad and held
as unconscionable an arbitration agreement that
contained no class arbitration waiver or prohibition.
See id. (“[A]bsent controlling . . . precedent
foreclosing a right to arbitrate, a motion to compel
arbitration will almost never be futile.”).

        The majority contends that it does not matter
that the arbitration clauses here lacked class arbitration

1
  The majority claims that, had the Defendants moved to
enforce the arbitration clauses in 2009, “they would have
been . . . forced into class arbitration with near certainty.”
Majority Op. 18. I disagree. The majority bases that view on
the flawed premise that these arbitration clauses implicated
Muhammad. There simply is no class arbitration bar that
would have been held unconscionable, and the clauses at
issue could have been interpreted either way.




                               4
waivers. See Majority Op. 26 n.12. According to the
majority, regardless of whether these clauses contained
class arbitration waivers, given Muhammad, it would
have been futile in 2009 for the Defendants to seek
individual arbitration. It concludes that “a New Jersey
court confronted with this case in 2009 would almost
certainly have found Muhammad controlling and
would have denied Defendants’ motion to compel
[individual] arbitration.” Id. at 24.

       That conclusion is simply wrong. The
majority’s analysis here fails to refer back to its own
characterization of Muhammad as being animated by
the explicit “class-arbitration bar,” or “class-arbitration
waiver,” at issue there. Majority Op. 21, 22. This
omission renders its conclusion not only arbitrary, but
wrong.

        Furthermore, contrary to the majority’s
position, the futility inquiry is not about disregarding
the actual arbitration clauses at issue and asking the
question—divorced from the arbitration clauses
themselves—of whether “it would have been futile to
move for [individual] arbitration under [Muhammad].”
Id. at 19. No circuit court has ever framed the inquiry
this way, and for good reason. As noted above, the
futility inquiry sensibly focuses on the enforceability
of the actual arbitration clauses—that is, would it
have been futile in 2009 for the Defendants to move to
enforce these clauses? See, e.g., Gutierrez v. Wells
Fargo Bank, NA, 704 F.3d 712, 719 (9th Cir. 2012)
(“Our [futility] analysis begins with the [arbitration
agreement] between Wells Fargo and the class




                                5
members.”); Fisher v. A.G. Becker Paribas Inc., 791
F.2d 691, 697 (9th Cir. 1986) (“Until the Supreme
Court’s decision in Byrd, the arbitration agreement in
this case was unenforceable.”). 2 Here, the answer is
no.

        But even if we were to pretend that these
clauses contained class arbitration waivers so as to
implicate Muhammad, a motion to compel individual
arbitration in 2009 would have been far from futile. In
Muhammad, the New Jersey Supreme Court did not
hold that class arbitration waivers were “per se”
unconscionable—far from it. 912 A.2d at 101. Rather,
in holding that particular class arbitration waiver
unconscionable, it articulated a “multi-factor analysis,”
one that necessitated a “fact-sensitive examination,”
for courts to apply when “evaluat[ing] claims of
unconscionability.” Id. at 97. A court must first
determine whether the class arbitration waiver was part
of a contract of adhesion. Id. at 96–97. If so, it must
next consider (1) “the subject matter of the contract”;
(2) “the parties’ relative bargaining positions”; (3) “the
degree of economic compulsion motivating the
adhering party”; and (4) “the public interests affected
by the contract.” Id. at 97 (internal quotation marks
omitted).




2
  The majority itself quotes this language from Fisher, see
Majority Op. 14, but then analyzes the futility issue here in a
manner totally divorced from the actual language of the
arbitration clauses.




                               6
        So, if we were to pretend Muhammad applied
here, the Defendants could have easily argued that
these arbitration clauses were not unconscionable.
Most notably, they could have shown that these
clauses were not part of contracts of adhesion, which
would have obviated the need for the court to even
consider the remaining factors. See id. (“The
determination that a contract is one of adhesion . . . is
the beginning, not the end, of the inquiry . . . .”
(internal quotation marks omitted)). As noted by the
majority in a footnote, the Plaintiffs “had the option”
to “ask[] for a pre-printed Arbitration Endorsement
which would have required both parties to consent to
arbitration.” Majority Op. 25 n.10. In other words, the
Plaintiffs could have avoided being forced into
arbitration. The Defendants thus could have
established that these contracts were not ones of
adhesion because the very terms at issue—the
arbitration clauses—were optional, i.e., they were not
“presented on a take-it-or-leave-it basis.” Muhammad,
912 A.2d at 96; see also Nino v. Jewelry Exchange,
Inc., 609 F.3d 191, 201 (3d Cir. 2010) (holding that an
arbitration agreement was part of a contract of
adhesion and thus procedurally unconscionable
because the defendant “presented the arbitration
agreement to [the plaintiff] for signature on a take-it-
or-leave-it basis” (internal quotation marks omitted)).
How, then, could it possibly have been futile in light of
Muhammad for the Defendants to move to compel
individual arbitration in 2009? I am baffled by the
majority’s conclusion that “there is little doubt” that
the arbitration clauses at issue here were part of
contracts of adhesion. Majority Op. 25.




                               7
        The Defendants’ inaction in 2009, and their
about-face to seek arbitration in 2011, were no doubt
driven by litigation tactics to derail the court
proceedings. At the outset of the case, they realized
that moving to compel individual arbitration under the
arbitration clauses here, which were silent as to class
arbitration, could have exposed them to class
arbitration—a situation they admitted they “would
never ever open [themselves] up for.” Oral Arg. Tr.
20:37–41, July 14, 2016. That prospect then became
unlikely when the Court decided Stolt-Nielsen S.A. v.
AnimalFeeds International Corp. and rejected the idea
that “the parties’ mere silence on the issue of class-
action arbitration constitutes consent to resolve their
disputes in class proceedings.” 559 U.S. 662, 687
(2010). Fueled by Stolt-Nielsen, they then seized the
opportunity to cloak their delay under the veil of
futility ostensibly afforded to them by AT&T Mobility
LLC v. Concepcion, 563 U.S. 333 (2011). But the
previous uncertainty as to class arbitration does not
mean that it would have been futile in 2009 for them to
move to enforce the arbitration clauses, which is the
dispositive question here. It just means that they might
not have succeeded in getting what they wanted:
individual arbitration.

        For these reasons, I respectfully dissent from
the majority’s opinion. It would have been far from
futile for the Defendants to move to enforce these
arbitration clauses in 2009. We should therefore
consider only whether their belated attempt to do so
prejudiced the Plaintiffs under the factors from




                              8
Hoxworth v. Blinder, Robinson & Co., Inc., 980 F.2d
912 (3d Cir. 1992). This analysis would undoubtedly
lead to our finding that the Plaintiffs were prejudiced
such that the Defendants waived their right to arbitrate.
The Defendants did not just warm the bench for two
and a half years before moving to compel arbitration.
During that time, they repeatedly contested the merits
of the Plaintiffs’ claims, engaged in substantial non-
merits litigation, and participated in extensive
discovery that cost the Plaintiffs over $57,000. Under
Hoxworth, this would not even be a close call. See id.
at 925–26 (finding prejudice where the defendants
waited eleven months to seek arbitration, participated
in numerous pretrial proceedings, filed motions
challenging the merits of the plaintiffs’ claims, and
took depositions).




                               9
