Tough Luck – Extreme Obstacle Course Registrants Forced Into Arbitration to Pursue Refunds; Class Action Barred (MA)

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Pazol v. Tough Mudder Inc. (Massachusetts)

The plaintiffs registered and paid to participate in Tough Mudder’s Boston-area “Mudderella” obstacle course event, which was scheduled to take place in Haverhill, Massachusetts.  However, a few days before the event, Tough Mudder moved the location of the event to Westbrook, Maine.  Plaintiffs were unable to attend the event at the new location, and Tough Mudder refused to refund their registration fees.  Therefore, the plaintiff filed a class action lawsuit against Tough Mudder.

Tough Mudder filed a motion to dismiss the action and compel mediation and arbitration.  The U.S. District Court for the District of Massachusetts granted the motion.  As part of the registration process on the Tough Mudder website, each of the plaintiffs agreed to the Participant Assumption of Risk, Waiver of Liability, and Indemnification Agreement (the “Participant Agreement”).  The Participant Agreement was presented in three separate scroll windows, and each registrant agreed to the terms by checking the box next to each scroll window.  The Participant Agreement included a mediation and arbitration provision, and it provided a waiver of all class action claims as follows:

“Class Actions: I agree that any arbitration, mediation, or legal action shall proceed solely on an individual basis without the right for any claims to be arbitrated on a class action basis or on bases involving claims brought in a purported representative capacity on behalf of others. Claims may not be joined or consolidated unless agreed to in writing by all parties.”

The Court noted that the Federal Arbitration Act (“FAA”) required courts to enforce agreements to arbitrate disputes, even where the agreement requires claims to be arbitrated individually.  Furthermore, the Court explained that “courts routinely uphold agreements to mediate in good faith as a condition precedent to arbitration or litigation.”  The Court could find no grounds to invalidate the agreement under the FAA.  The Court also explained that although the Participant Agreement may have been a contract of adhesion, that fact alone did not make the terms at issue enforceable.  Additionally, the Court stated that the “fact that Plaintiffs clicked an online checkbox to indicate their assent” did not affect the analysis in that as “[s]uch ‘clickwrap’ agreements are commonly enforced in Massachusetts and Federal Courts.”  Therefore, the Court found that the Participant Agreement’s mediation, arbitration, and class waiver terms were valid and enforceable.

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