Panel Probes Scope and Reach of Bluelink Contract
U.S. Circuit Judge Morgan Christen pressed Boutrous, pointing out that the arbitration clause wasn’t included in the car-purchase agreement but tucked inside a separate Bluelink contract that “purports to cover everything and replace everything.”
Boutrous conceded the clause’s broad sweep, arguing that such scope questions are for an arbitrator to decide.
He said the arbitration agreement covers all claims touching the Bluelink system and “other causes of action related to the vehicle,” including the tow-hitch defect at the center of the suit.
Judge Christen countered that the Bluelink terms shrink the statute of limitations from four years to one and “waive remedies otherwise available under California law.”
“The agreement seems to me to be quite extraordinary,” she remarked.
Boutrous argued there was no coercion: buyers were not required to enroll in Bluelink, and many purchased vehicles without signing up.
Plaintiffs Say Arbitration Clause ‘Entraps’ Consumers
Representing the SUV owners, Stephen Taylor of Lemberg Law LLC said the Bluelink contract has “nothing to do” with the lawsuit’s core claim — that faulty tow-wiring harnesses in 2020–2022 Palisade models can short-circuit and ignite.
Taylor argued that no reasonable consumer would expect that a free connected-services feature would secretly force them into arbitration for all vehicle-related disputes.
The district judge, he said, correctly recognized the “surprise and entanglement” of requiring arbitration through a complimentary service agreement that “captures all their rights and Hyundai’s obligations.”
When Judge Danielle J. Forrest asked whether unconscionable terms could simply be severed, Taylor replied that the clause contains a “laundry list” of problematic provisions.
