In a recent decision by the Wisconsin Court of Appeals, OptumRx, Inc., a pharmacy benefits manager, has been granted a reversal in its legal battle to compel arbitration against 71 pharmacies. The case centers around whether the parties agreed to delegate questions of arbitrability to an arbitrator, as stipulated in their arbitration agreement. The circuit court had previously dismissed OptumRx’s petition, ruling that the arbitration agreement was unconscionable and imposed unfairly on the pharmacies. However, the appellate court found that the delegation provision within the Amended Pharmacy Manual clearly indicated an agreement to arbitrate such threshold questions. The case has been remanded for further proceedings to determine the enforceability of this delegation provision specifically.
The appellate court emphasized that while parties can agree to arbitrate questions of arbitrability, any challenge to a delegation provision must be addressed by a court before enforcing such agreements. The Pharmacies’ arguments regarding procedural and substantive unconscionability were deemed sufficient to warrant judicial review of the delegation provision’s enforceability.
This decision underscores the importance of clear contractual language in arbitration agreements and highlights the courts’ role in ensuring fairness in their enforcement.
Source: OptumRX_Inc_v_Marinette_Menominee_Prescription_Center_LTD_Opinion_Wisconsin_Court_of_Appeals.pdf
