Supersession and Severability in Consumer Arbitration: Fourth Circuit Holds Later‑in‑Time RSA Controls and Limits Unconscionability Review to Clause‑Specific Terms

Introduction

In a published decision with significant implications for consumer arbitration in the Fourth Circuit and West Virginia, the Court of Appeals reversed a district court’s refusal to compel arbitration in three consolidated cases brought by West Virginia Suddenlink customers. The court held that the operator’s October 2021 Residential Services Agreement (RSA)—not an earlier 2017 version—governs the disputes, that the 2021 arbitration clause was validly formed and not unconscionable, and that the Federal Arbitration Act (FAA) limits a court’s review at the gateway stage to challenges directed at the arbitration clause itself.

The decision clarifies two central points. First, under West Virginia contract law, later-in-time RSAs supersede inconsistent earlier versions; post-suit amendments do not retroactively control when the contract forecloses retroactivity. Second, under the FAA’s severability doctrine, courts deciding motions to compel may consider only defenses specific to the arbitration clause—not to general contract provisions placed outside the clause, such as punitive-damages limitations or general limitation periods.

Judge Rushing authored the opinion for the court, joined by Judge Lewis. Judge Wynn concurred in part and in the judgment, emphasizing that “website-only” notice of unilateral amendments would not satisfy West Virginia’s “reasonable notice” requirement, while agreeing that, under West Virginia law, consideration supporting the container contract suffices to support the arbitration clause.

Case Overview

Plaintiffs Benjamin Meadows, Richard Chaty, and Roxie Gooch—longtime Suddenlink customers—filed separate state-court actions in April 2022 alleging poor quality cable and internet services in violation of contract and West Virginia law. Suddenlink removed and moved to compel arbitration under the October 2021 RSA’s arbitration provision, which:

• Requires individual AAA consumer arbitration with a 60-day pre-arbitration “Notice of Dispute” period.
• Waives jury and class/representative proceedings and bars “non-individualized relief” affecting other subscribers.
• Allocates fees per AAA Consumer Arbitration Rules, with Suddenlink paying all AAA fees if it initiates.
• States arbitrability/scope/enforceability issues are for a court (a carve-out from arbitrator authority).
• Contains severability and a modification clause with notice and a non-retroactivity term for amendments.

The district court denied the motions, sua sponte selecting the 2017 RSA as the operative contract and holding that arbitration provision unconscionable. The Fourth Circuit reversed, directing the district court to compel arbitration.

Summary of the Opinion

• The October 2021 RSA and its arbitration clause govern. Later-in-time RSAs supersede earlier, inconsistent versions (Myers v. Carnahan), and the July 2022 RSA could not apply retroactively to claims filed in April 2022 due to the 2021 clause’s non-retroactivity term.
• Formation was valid under West Virginia law: mutual assent was conceded; consideration existed because both sides promised to arbitrate. The unilateral modification right, paired with notice and a right to cancel/accept by continued use, did not render the promise illusory (Citizens Telecommunications Co. v. Sheridan).
• Severability and scope of review: courts deciding a motion to compel may only resolve challenges specific to the arbitration clause. Challenges to general RSA terms (punitive-damages limits, one-year limitation, liability caps) belong to the arbitrator (Buckeye Check Cashing; Prima Paint; Muriithi; Snowden).
• Unconscionability (West Virginia’s sliding-scale test) failed: plaintiffs showed neither procedural nor substantive unconscionability of the 2021 clause. Adhesion and lack of opt-out alone are not enough; incorporation of AAA Consumer Rules is acceptable; pre-arbitration notice and a limited arbitral appeal right are reasonable; the ban on non-individualized relief, including class-wide injunctive relief, is enforceable (Concepcion; Italian Colors; Sheridan).
• No waiver: Suddenlink did not waive arbitration by settling unrelated claims in a separate New Jersey class action (MicroStrategy v. Lauricia; Leeper v. Altice USA).

Detailed Analysis

Precedents and Authorities Cited and Their Influence

• FAA and Gateway Review
  • Adkins v. Labor Ready, Inc., 303 F.3d 496 (4th Cir. 2002): Sets the four-part test for compelling arbitration and the “no choice but to grant” mandate when a valid agreement covers the dispute.
  • First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995): Courts apply ordinary state-law formation principles.
  • Kindred Nursing Ctrs. L.P. v. Clark, 581 U.S. 246 (2017): State-law rules cannot single out arbitration for disfavored treatment.
  • Coinbase, Inc. v. Suski, 144 S. Ct. 1186 (2024): Once satisfied that an arbitration agreement was made, courts must send the dispute to arbitration under 9 U.S.C. § 4.
• Severability and Clause-Specific Challenges
  • Prima Paint Corp. v. Flood & Conklin, 388 U.S. 395 (1967), and Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006): Arbitration provisions are severable; only clause-specific defenses may be resolved by courts at the motion-to-compel stage.
  • Snowden v. CheckPoint, 290 F.3d 631 (4th Cir. 2002), and Muriithi v. Shuttle Express, 712 F.3d 173 (4th Cir. 2013): Reinforce clause-specificity; general contract defenses (e.g., a one-year limitation) are for the arbitrator when not tied to the arbitration clause.
• West Virginia Contract Formation and Modification
  • AMFM, LLC v. King, 740 S.E.2d 66 (W. Va. 2013): Elements of contract formation.
  • Thornsbury v. Cabot Oil & Gas, 749 S.E.2d 569 (W. Va. 2013); Myers v. Carnahan, 57 S.E. 134 (W. Va. 1907): Later-in-time inconsistent contracts supersede earlier ones even without express abrogation.
  • Citizens Telecomms. Co. v. Sheridan, 799 S.E.2d 144 (W. Va. 2017): Unilateral modification with reasonable notice and customer assent by continued use does not render promises illusory; supports the court’s conclusion that Suddenlink’s promise to arbitrate is supported by consideration.
  • Dan Ryan Builders, Inc. v. Nelson, 737 S.E.2d 550 (W. Va. 2012): Consideration supporting the container contract can support the arbitration clause (featured in Wynn’s concurrence).
• Unconscionability (West Virginia)
  • Brown v. Genesis Healthcare Corp. (Brown I), 724 S.E.2d 250 (W. Va. 2011), vacated on other grounds, and Brown II, 729 S.E.2d 217 (W. Va. 2012): Dual (procedural and substantive) unconscionability with a sliding scale; adhesion alone is insufficient.
  • Nationstar Mortg., LLC v. West, 785 S.E.2d 634 (W. Va. 2016): Lack of opt-out not dispositive.
  • Troy Mining Corp. v. Itmann Coal Co., 346 S.E.2d 749 (W. Va. 1986): Courts do not equalize bargaining power absent unfairness in terms/process.
  • McFarland v. Wells Fargo Bank, N.A., 810 F.3d 273 (4th Cir. 2016); Richmond Am. Homes of W. Va., Inc. v. Sanders, 717 S.E.2d 909 (W. Va. 2011): Substantive unconscionability turns on one-sidedness, harshness, commercial reasonableness, and policy.
• Class/Representative Waivers
  • AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011), and Am. Express Co. v. Italian Colors Rest., 570 U.S. 228 (2013): FAA preempts rules undermining class waivers in arbitration; class/representative waivers are enforceable.
  • Sheridan, 799 S.E.2d at 154; Ocwen Loan Servicing, 752 S.E.2d 372; AT&T Mobility v. Wilson, 703 S.E.2d 543: West Virginia law respects class and classwide-injunctive relief waivers in arbitration.
• Assent via Device/Online
  • Mey v. DIRECTV, LLC, 971 F.3d 284 (4th Cir. 2020); Hancock v. AT&T Co., 701 F.3d 1248 (10th Cir. 2012): Valid assent via electronic presentation at installation; customers can be bound by on-screen terms.
  • New v. GameStop, Inc., 753 S.E.2d 62 (W. Va. 2013): Courts may presume a contracting party read and assented to terms absent evidence to the contrary.
• Waiver by Conduct in Other Litigation
  • MicroStrategy, Inc. v. Lauricia, 268 F.3d 244 (4th Cir. 2001): Litigation of distinct claims in other matters does not waive arbitration of unrelated claims with different counterparties.
  • Leeper v. Altice USA, Inc., 722 F. Supp. 3d 893 (W.D. Ark. 2024); Bischoff v. DirecTV, Inc., 180 F. Supp. 2d 1097 (C.D. Cal. 2002); Lawrence v. Household Bank, 343 F. Supp. 2d 1101 (M.D. Ala. 2004): Settlements elsewhere do not forfeit arbitration rights here; incentivizing settlements matters.

  Legal Reasoning

  1) Which Contract Governs? Supersession and Timing

  The court rejected the district court’s sua sponte reliance on the 2017 RSA. All parties agreed the October 2021 RSA governed when suit was filed. Under West Virginia law, later-in-time agreements supersede earlier inconsistent ones even without an explicit abrogation clause. The court deemed the various RSAs mutually incompatible on material points, thus the 2021 version controlled. The July 2022 update could not apply: the 2021 clause itself states that amendments do not apply to claims already filed, and the 2022 language did not purport to retroactively reach already-filed claims.

  2) Formation: Mutual Assent and Consideration; Unilateral Modification and Illusory Promises

  Plaintiffs conceded assent to the 2021 RSA. The court found consideration because both parties surrendered the right to litigate and bound themselves to arbitrate. Plaintiffs’ “illusory promise” argument failed under Sheridan: a unilateral modification right paired with notice and the customer’s right to cancel/accept by continued use does not vitiate consideration for the arbitration promise. Judge Wynn concurred but flagged that website‑only notice would not satisfy West Virginia’s “reasonable notice” requirement; however, because West Virginia allows consideration from the container contract to support the arbitration clause, this potential infirmity did not defeat formation.

  3) The FAA’s Severability Doctrine Limits Gateway Review

  The decision draws a bright line: on a motion to compel, courts may address only defenses directed at “the arbitration agreement” (here, paragraph 24). Attacks on general RSA terms—e.g., punitive-damages limits, one-year “contractual statute of limitations,” and liability caps—apply in any forum and are therefore for the arbitrator. Plaintiffs’ attempt to argue that Suddenlink “moved” harsh terms out of the arbitration clause failed; Buckeye and Muriithi preclude courts from reaching such general terms at this stage. This is a practical roadmap for drafters and litigants: clause-specific defenses are cognizable; contract-wide defenses are for the arbitrator.

  4) Unconscionability: Procedural and Substantive

  Applying West Virginia’s “sliding scale,” the court found neither procedural nor substantive unconscionability:

  • Procedural:
    • Adhesion and lack of opt-out do not alone establish procedural unconscionability (Nationstar; Brown II). Generalized assertions of unequal bargaining power, market dominance, or population literacy rates were insufficient absent party-specific proof.
    • Terms were not “hidden” or unduly complex: the arbitration notice was bolded/underlined; AAA Consumer Rules were incorporated via hyperlink; presenting terms on a technician’s device does not deny a “reasonable opportunity” to understand them, especially where multiple later assents occurred through billing and continued use (Mey; Hancock).
  • Substantive:
    • The 60-day pre-arbitration notice-and-negotiation requirement is bilateral and commercially reasonable (Concepcion approved a similar waiting period).
    • The arbitral appeal mechanism is not one-sided: either party may appeal when the amount exceeds $75,000 or injunctive relief is sought. Concerns about fee-shifting under AAA’s Optional Appellate Arbitration Rules (OAAR) were misplaced because the OAAR, by their terms, do not apply to standardized consumer agreements; at most, incorporation was ineffective, leaving an otherwise reasonable structure.
    • The waiver of “non-individualized relief”—including class-wide injunctive relief—was enforceable under the FAA and West Virginia law (Concepcion; Italian Colors; Sheridan).

  5) Waiver by Separate Class Settlement? No.

  Suddenlink’s separate settlement in New Jersey over different fee/surcharge claims did not waive arbitration rights here. Waiver cannot be predicated on inconsistent conduct in unrelated litigation with different parties (MicroStrategy; Leeper; Bischoff; Lawrence).

  Impact and Practical Implications

  • Which version controls? The decision signals that, in this Circuit applying West Virginia law, courts will enforce the version of an arbitration clause in effect when suit is filed, provided later post-suit amendments are non-retroactive by contract. Businesses should draft explicit non-retroactivity language for amendments to preserve predictability.
  • Severability is decisive at the gateway. Plaintiffs seeking to defeat arbitration must aim their defenses at the clause itself. General limitations (punitive damages, limitation periods, liability caps) positioned outside the clause cannot be used to defeat a motion to compel; they are for the arbitrator. Drafters who relocate broad remedial limits to the general terms may thereby reduce clause-specific attack vectors at the motion-to-compel stage.
  • Unilateral modification clauses. Under Sheridan, modification rights coupled with reasonable notice and an opportunity to cancel do not render arbitration promises illusory. Judge Wynn’s concurrence, however, cautions that “website-only” notice is likely insufficient under West Virginia law. Best practices: provide written notice by email and/or hard copy in billing statements, with clear effective dates and opt-out/cancellation instructions.
  • Class/representative relief waivers remain safe harbors. The opinion reinforces that class-action and classwide-injunctive relief waivers in arbitration clauses are enforceable under both the FAA and West Virginia law.
  • Pre-arbitration notice-and-wait provisions are acceptable. Bilateral, modest cooling-off periods (e.g., 30–60 days) that facilitate informal resolution are commercially reasonable and not unconscionable.
  • Electronic presentation is viable. Presenting terms on a technician’s device is not inherently unconscionable, particularly where notice is conspicuous and assent is later reinforced via billing notices and continued use.
  • Appeal mechanisms. Incorporating AAA OAAR in consumer-standardized contexts may be ineffective because the OAAR exclude such cases; if appellate review is important, consider bespoke appeal language administered by an arbitral provider that will accept consumer appeals or ensure the provider’s rules allow it.
  • Litigation strategy. Defendants should build a clean record of: (a) the operative clause at filing; (b) notice and assent mechanisms over time; and (c) clause-specific fairness. Plaintiffs should marshal clause-specific procedural and substantive unconscionability evidence; general grievances about the overall RSA or market dynamics will not carry the day.

  Complex Concepts Simplified

  • Severability (in arbitration): An arbitration clause is treated as a separate contract inside the larger contract. Courts evaluate defenses aimed at the clause; disputes about the rest of the contract go to the arbitrator.
  • Unconscionability (West Virginia): A contract term is unenforceable only if both (a) the bargaining process was unfair (procedural), and (b) the term is one‑sided/harsh (substantive). The stronger the showing on one, the less needed on the other.
  • Illusory promise: A “promise” that leaves a party free to perform or not perform is not real consideration. But giving reasonable notice of modifications and allowing the other party to reject/cancel prevents illusoriness.
  • Supersession: When parties sign a new agreement with terms inconsistent with an older one, the new one ordinarily replaces the old as to those inconsistencies.
  • Class/representative waiver: A contractual requirement to arbitrate only individualized claims and seek individualized relief, excluding class or representative proceedings. Under the FAA, such waivers are enforceable.
  • Gateway issues: Questions courts decide before sending a case to arbitration, such as whether a valid arbitration agreement exists and whether it specifically was formed/enforceable.

  Conclusion

  Meadows v. Cebridge Acquisition, LLC reinforces core FAA doctrines and West Virginia contract principles in the consumer-arbitration setting. The Fourth Circuit held that the October 2021 arbitration clause—later in time than prior RSAs and pre-dating suit—governs and is enforceable. The court applied severability to cabin judicial review to clause-specific defenses, rejected unconscionability challenges to the 2021 clause, and affirmed the enforceability of non-individualized relief waivers. It also clarified that post-suit amendments do not retroactively govern when the contract so provides and that litigation elsewhere does not waive arbitration of unrelated claims here.

  The opinion offers a drafting and litigation blueprint: ensure conspicuous notice and bilateral fairness features; provide reasonable pre-arbitration notice-and-wait periods; avoid reliance on website-only amendment notices; and place broad remedial limitations in general terms rather than in the arbitration clause. For challengers, the message is equally clear—success at the gateway requires clause-specific grounds that jointly satisfy West Virginia’s demanding procedural and substantive unconscionability test.