Seventh Circuit Holds That Pre-Class Certification Conduct Can Waive Arbitration

The Seventh Circuit Court of Appeals has held that courts may consider a defendant’s pre-class certification conduct to determine whether that conduct is inconsistent with and therefore waives any right the defendant may have to compel arbitration.

Club Exploria LLC worked with vendors to make prerecorded calls to potential customers of its vacation properties. One of those potential customers filed a putative class action claiming that the calls violated the Telephone Consumer Protection Act.

Club Exploria defended itself. It asserted affirmative defenses, engaged in class-related discovery, filed motions on the merits of the claims, and opposed class certification.

After class certification, Club Exploria filed a motion to amend its answer to assert that the case should be heard in arbitration. It did not file a motion to compel arbitration for another year.

The district court held that Club Exploria had waived its right to raise arbitration.

Club Exploria appealed and the Seventh Circuit affirmed. Club Exploria argued that a pre-class certification motion to compel arbitration would have been futile because “the putative class members are not yet a party, so the district court lacks jurisdiction over them.” The plaintiff countered “that a defendant can still act inconsistently with its intent to arbitrate before moving to compel arbitration.” The Seventh Circuit agreed, holding “that a defendant’s pleadings, conduct during class-related discovery, and arguments in opposition to class certification are relevant to the waiver decision.” Applying that standard to the facts of the case, the court held that “Exploria’s conduct at each stage of the litigation was inconsistent with an intent to arbitrate.” Club Exploria delayed four and a half years before raising the topic of arbitration.

Moore v. Club Exploria, LLC, No. 25-2721 (7th Cir. Aug. 18, 2026).