Fifth Circuit Considers Arbitration Clause In ERISA Claim

A Fifth Circuit panel asked a former employee of International Bancshares Corp. to explain why an arbitration clause shouldn't govern his Employee Retirement Income Security Act (ERISA) class action case. The case is Paul Parrott v. International Bancshares Corp. et al., Case Number 25-50367, in the U.S. Court of Appeals for the Fifth Circuit.

According to Paul Parrott, he didn't consent to the arbitration clause in the plan, which rendered it unenforceable as to his suit. However, one judge on the appellate panel pointed out that the legal theory would be an easy way to overcome arbitration clauses in ERISA class actions, but that no other courts had adopted it, casting doubt on its feasibility.