Plaintiff Jessica Ponkey has prevailed in an appeal against a decision to close her LuLaRoe class-action.

Ponkey’s class-action was
closed last year
, following a Final Arbitration Award issued in April 2022.

Ponkey filed an appeal with the Ninth Circuit on May 27th.

On July 31st, 2023, the Ninth Circuit issued a memorandum, ordering the arbitration proceedings be reversed.

In handing down their decision, the Ninth Circuit determined LuLaRoe compelled arbitration to resolve Ponkey’s case “in an inferior forum that work[ed] to LuLaRoe’s advantage”.

Therefore, we conclude that the parties’ arbitration agreement is unenforceable under California’s sliding-scale approach, and we also conclude that the district court cannot sever the offending terms to preserve the agreement’s enforceability.

Because we conclude that the arbitration provision is unenforceable, we need not reach the issue of whether the district court erred in compelling arbitration against the non-signatory defendants.

With arbitration unenforceable, Ponkey’s case returns to the Central Distric tof California.

As of August 23rd, there are no further entries on Ponkey’s class-action docket.

Ponkey
sued LuLaRoe back in March 2021
, alleging the MLM company operated as “an unlawful, fraudulent pyramid scheme”.

Stay tuned for updates as BehindMLM continues to track the reopened case.

Update 19th September 2024 – 
Plaintiff Ponkey’s class-action has been
dismissed for a second time
, this time with prejudice.

Ponkey filed an appeal against the decision on September 18th.

🤖 Quick Answer

What was the outcome of Jessica Ponkey's appeal against LuLaRoe's class-action closure?
The Ninth Circuit reversed the arbitration proceedings on July 31st, 2023, ruling that LuLaRoe's arbitration agreement was unenforceable. The court determined the arbitration clause created an inferior forum advantaging LuLaRoe and declined to sever the problematic terms under California's sliding-scale approach.

Why did the Ninth Circuit invalidate LuLaRoe's arbitration agreement?
The court found that LuLaRoe compelled arbitration in an inferior forum structurally advantageous to the company. Applying California's sliding-scale analysis, the Ninth Circuit determined the agreement's terms were unenforceable and could not be partially preserved, requiring complete invalidation.

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