In this class action matter arising out of a contract dispute, plaintiffs appeal from a July 15, 2022 order granting defendants' motion to stay proceedings against Verizon and to compel arbitration in accordance with the arbitration agreement appearing in the Verizon Customer Agreement. In an oral opinion of the same date, the trial judge first severed a limitation on damages provision from the agreement before enforcing the arbitration clause. In reaching its decision, the court did not discuss any provision of the agreement other than the limitation on damages and severability clause. Nor did the trial judge address why the reasoning of MacClelland v. Cellco P'ship, 609 F. Supp. 3d 1024 (N.D. Cal. 2022), which found the exact same arbitration clause unenforceable as permeated with unconscionability, should not apply with equal force here.
Exercising de novo review, the court held that the arbitration agreement is unenforceable in its entirety as it is permeated by provisions which are unconscionable and violative of New Jersey public policy. The court affirmed the trial judge's determination striking the agreement's limitation on damages, reversed the order staying the proceedings and compelling arbitration, and remanded for proceedings consistent with its decision.