This section contains the nature of the case and procedural background.

Carter and others (Ps) are current and former employees of D. When they agreed to employment at D, they also agreed to mandatory arbitration. They sued D to recover overtime compensation due under the provisions of the Fair Labor Standards Act. D moved to compel arbitration under arbitration agreements which all employees sign as a condition of their employment with the company. Ps claimed that the Agreements were invalid because FLSA claims are not subject to arbitration; the Agreements are unconscionable; the Agreements infringe on substantive rights otherwise granted by the FLSA; and the fee-splitting arrangement contained in the Agreements imposes impermissibly prohibitive arbitration costs on them. The court disagreed with the first three but held that the fee-splitting agreements imposed prohibitive costs and it simply severed this provision from the Agreements under the severability clause. It then granted D's motion to compel arbitration. Ps appealed.

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