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Ticket Transfer Undermines Cubs’ Ability to Compel Arbitration

March 26, 2021 Patrick Hammon

An arbitration provision summarized on the back of a baseball ticket that was won in a raffle and then gifted to a relative is not enforceable, according to an Illinois appellate court in a decision handed down March 17, 2021.  (See Laiah Zuniga, Plaintiff-Appellee, v. Major Leage Baseball, Defendant-Appellant (Chicago Cubs Baseball Club, LLC, Respondent in Discovery-Appellant), 2021 IL App (1st) 201264.)  On August 27, 2018, Laiah Zuniga attended a Chicago Cubs game at Wrigley Field using a ticket her father had won earlier that day at work.  Ms. Zuniga was sitting in her seat at the game, eating a sandwich, when, lo and behold, a foul ball struck her in the face.  Ms. Zuniga sustained serious injuries to her head and face and spent several days at the hospital. She eventually filed suit in an Illinois state court seeking redress for her injuries.

Major League Baseball and the Chicago Cubs responded by filing a motion to compel binding arbitration of Ms. Zuniga’s personal injury claim.  Citing the fine print on the ticket given to her by her father, the baseball defendants argued she was bound by the terms of a mandatory arbitration provision.  The front of the ticket featured text directing ticketholders to review the back of the ticket.  On the reverse side of the raffled ticket, below an advertisement occupying roughly one-third of the space, was a paragraph stating that:

By using this ticket, ticket holder (‘Holder’) agrees to the terms and conditions available at www.cubs.com/ticketback (the ‘Agreement’), also available at the Chicago Cubs administrative office. Key terms of the Agreement are summarized below (the Agreement controls in the event of any conflict). 

Furthermore, the fifth paragraph, in regular type, stated:

Any dispute/controversy/claim arising out of/relating to this license/these terms shall be resolved by binding arbitration, solely on an individual basis, in Chicago, Illinois.  Holder and Cubs agree not to seek class arbitration or class claims and the arbitrator(s) may not consolidate more than one person's claims.

While the Cubs’ website had a robust description of the purported arbitration agreement, which included the applicable procedures, the governing law, and the policy for opting out of the process, the foregoing provisions were the only relevant text contained on Ms. Zuniga’s ticket itself. 

Ms. Zuniga opposed the motion, arguing the arbitration provision was unenforceable.  While Ms. Zuniga did not dispute defendants’ contention that she had entered into a binding contract by using the ticket, she argued the arbitration provision was procedurally unconscionable, given the size of the font and the need to visit the Cubs’ website to understand the terms of the alleged agreement to arbitrate. 

The Circuit Court of Cook County disagreed with the Cubs and the League and denied the motion to compel.  The trial court sided with plaintiff, finding the arbitration provision was procedurally unconscionable for the following reasons:

(1) the type on the front of the ticket directing the ticketholder to the terms and conditions on the back was “inconspicuous and very difficult to see;”

(2) the type used to summarize terms on the back of the ticket was “extremely small and difficult to read;”

(3) the summary of terms and conditions on the back of the ticket discussed a variety of topics and addressed arbitration only at the bottom, without separating, bolding, or setting that provision apart in any way;

(4) the extent of the summary of the arbitration provision was a statement that “‘any dispute/controversy/claim arising out of/relating to this license/these terms shall be resolved by binding arbitration, solely on an individual basis’;” and

(5) the top of the back of the ticket stated the ticket holder agreed to the terms and conditions available on the website without stating the full arbitration agreement was located there, or referencing the website again near the bottom of the ticket where arbitration is addressed.

While the foregoing considerations are not unusual in cases involving questions about the enforceability of arbitration provisions, the trial court focused on one final factor that is far less common in such cases.  Specifically, the trial court examined—and found significant—the fact that plaintiff did not purchase the ticket herself.  Because the ticket had been gifted, not purchased, the trial court concluded it would be unfair to find she negotiated or bargained for the terms of the agreement.  This consideration was important in the court’s finding that the facts were sufficient to “raise significant doubts as to whether the Plaintiff had a meaningful opportunity to become aware of, let alone agree to, the terms of the arbitration clause.” The court concluded the provision was unenforceable. 

The baseball defendants disagreed and filed an interlocutory appeal.  On appeal, the First District Appellate Court of Illinois affirmed the trial court’s denial of the baseball defendant’s motion to compel arbitration, agreeing the provision was procedurally unconscionable.  The appellate court upheld each of the trial court’s findings. Importantly, the appellate court focused on the consideration that made this case different from many other unconscionability cases—specifically, the fact that Ms. Zuniga did not purchase, but instead was gifted, the ticket at issue.  The court explained that “[t]his case is different from most cases addressing procedural unconscionability because the plaintiff here allegedly assented to this arbitration provision by her conduct,” not through “an internet or other electronic transaction during which a consumer has electronically clicked a button or checked a box confirming that he or she agrees to certain terms or condition as part of that electronic transaction.”  The fact that this was “not a traditional method of forming a contract” appeared critical to the appellate court’s affirmance.

While the case will have no binding impact on any cases brought by sports fans against teams located outside of Illinois, it is likely that clubs located across the country (and across all major sports) will take notice of what some might call the Zuniga loophole—where a potential plaintiff was not the purchaser, but instead merely a recipient, of the ticket at issue.  Given the economic advantages presented by the arbitration of disputes, one can expect teams throughout MLB to transfer information about arbitration terms from their websites to their tickets.

More broadly, the Zuniga court’s focus on the provenance of the instrument featuring the ADR provision (the ticket) requires a closer examination of questions relating to arbitrability by both plaintiffs and defendants, in and outside of the world of sports.  For potential defendants, efforts should be considered about how to close this loophole by making it express that a consumer assents to the terms, not only by purchasing a particular product, service, or opportunity, but also by using it.  For potential plaintiffs, counsel should be less willing to take arbitration provisions at face value. Instead they should conduct additional pre-suit diligence into whether any type of transfers took place (of the good, service, or opportunity at issue) that could create the same type of loophole at issue in Zuniga.

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