A North Carolina federal court has held that a former employee's general allegations of unconscionability, unsupported by specific factual assertions, are insufficient to avoid an obligation to arbitrate.

In Schmitt v. SSC Statesville Brian Center Operating Co. LLC, No. 3:07CV321, 2008 WL 1745870 (W.D.N.C. Apr. 11, 2008), former employee Schmitt brought claims of wrongful termination and defamation against nursing home SSC. After removing the case to federal court, SSC moved to compel arbitration and stay the action, maintaining that Schmitt's claims were within the scope of a valid arbitration agreement she consented to while employed with SSC.

Finding the parties' employment relationship involved and affected interstate commerce, the Court applied the Federal Arbitration Act and found that Schmitt's claims fell squarely within the parties' broadly-worded agreement. Both the termination and defamation claims related to Schmitt's employment as contemplated in the agreement.

Schmitt argued that the agreement was unconscionable, but did not present specific evidence to support the allegation. Furthermore, the Court's review of the agreement revealed "that its terms are fair and reasonable, not oppressive or one-sided," and precluded any finding of unconscionability. Therefore, under these circumstances, the Court found that the additional discovery requested by Schmitt would not be helpful or necessary.