Lamps Plus, Inc. v. Varela

Frank Varela (plaintiff) had signed an arbitration agreement when he began working for Lamps Plus, Inc. (defendant); after a data breach exposed the tax information of 1,300 Lamps Plus employees and someone filed a fraudulent tax return in Varela's name, Varela brought a putative class action on behalf of all affected employees. Lamps Plus moved to compel individual arbitration, but the trial court ordered class-wide arbitration instead, and the Ninth Circuit, finding the arbitration agreement ambiguous on the class-arbitration question, construed that ambiguity against Lamps Plus as the drafter of an adhesion contract and affirmed class arbitration; Lamps Plus appealed, arguing an ambiguous agreement cannot itself supply the required contractual basis for compelling arbitration on a class-wide basis.