A judge has ruled that a corporation could still force a lawsuit into arbitration despite waiting several months after being sued to invoke a mandatory arbitration provision in its operating agreement.
Attorney Gordon Katz said it was a close call. Another judge might have ruled another way and found the defendant to have waived arbitration by litigation conduct, he said.
"The moral of the story is that arbitration rights should be asserted at the first opportunity to do so," Mr. Katz said. "Otherwise, the door will be opened for the argument that the right to arbitrate has been waived by participation in judicial proceedings."
READ: Corporation can force arbitration despite delay (subscription required)
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