Tagged: Arbitration

The U.S. Supreme Court Has Misinterpreted The Federal Arbitration Act

The U.S. Supreme Court Has Misinterpreted The Federal Arbitration Act

For parties aggrieved by another’s refusal to arbitrate under a written agreement, the Federal Arbitration Act grants the ability to petition any court of the United States for an order compelling the parties to arbitrate the dispute. The FAA applies where (absent the arbitration agreement) federal courts would have jurisdiction over the subject matter. This article will overview the evolution of modern arbitration agreements, explore the flaws in the current federal law approach to arbitration, and suggest needed reforms. The FAA The first modern arbitration statute was enacted in New York in 1920. That statute made enforceable all arbitration agreements...

Examining the Ninth Circuit’s View on Iskanian v. CLS Transportation Los Angeles, LLC: An Update on California’s Enforcement of Arbitration Clauses

Examining the Ninth Circuit’s View on Iskanian v. CLS Transportation Los Angeles, LLC: An Update on California’s Enforcement of Arbitration Clauses

In Sakkab v. Luxottica Retail North America, Inc., No. 3:12-cv-00436-GPC-KSC, 2015 WL 5667912 (9th Cir. 2015), the Ninth Circuit held last month in a 2–1 decision that the Federal Arbitration Act (“FAA”) does not preempt the California Supreme Court’s decision in Iskanian v. CLS Transportation Los Angeles, LLC, 59 Cal.4th 348, 359 (2014), which held, among other things, that an employer’s arbitration agreement cannot require employees to waive representative claims under California’s Private Attorneys General Act of 2004 (“PAGA”), Cal. Labor Code §§ 2698–2699.5 (2004), as a condition of employment. Because both opinions are extensive and complex—Iskanian’s three opinions total...

Opinion Analysis: Sanchez v. Valencia Holding Company, LLC

Opinion Analysis: Sanchez v. Valencia Holding Company, LLC

The California Supreme Court has continued its dialogue with the U.S. Supreme Court about arbitration agreements in a recent ruling that affirmed the use of California unconscionability law to determine the validity of arbitration agreements, but declined to invalidate the agreement before it. In the course of this years-long dialogue, the California Supreme Court has tended to apply principles of California law to invalidate arbitration provisions, while the U.S. Supreme Court has tended to invoke the Federal Arbitration Act (“FAA”) to uphold arbitration provisions. Prior Decisions Over thirty years ago, the U.S. Supreme Court overturned a ban on arbitration imposed...

Arbitrators may decide Pitchess motions

Arbitrators may decide Pitchess motions

A recent California Supreme Court decision raises questions about the extent to which nonjudicial officers should decide disclosure questions. In Riverside County Sheriff’s Department v. Stiglitz, the court ruled that an arbitrator deciding an appeal from disciplinary action against a peace officer could inspect confidential personnel records of other peace officers and determine whether they should be disclosed in the arbitration proceeding. The statutes in question establish a qualified privilege for peace officer personnel records and prescribe a procedure for determining whether they should be disclosed, commonly called Pitchess rights. Under the facts of Pitchess v. Superior Court, Peter Pitchess...

Upcoming oral argument in Sanchez v. Valencia Holding Company on arbitration agreement enforcement

Upcoming oral argument in Sanchez v. Valencia Holding Company on arbitration agreement enforcement

On May 5, 2015, the Supreme Court of California will hear arguments in Sanchez v. Valencia Holding Company, LLC. The case will address whether an arbitration clause from a car purchase contract is enforceable. The events of the case arose when plaintiff Gil Sanchez learned that the used Mercedes-Benz car he had purchased could not be repaired despite several attempts by the dealer. Sanchez later discovered that the car he purchased had previously been in an accident and was inadequately repaired. Sanchez sued, seeking class action status, for improper disclosures and other misconduct in the sale. The defendant car dealer,...

Opinion Analysis: Richey v. AutoNation

Opinion Analysis: Richey v. AutoNation

On January 29, 2015, a unanimous California Supreme Court issued its opinion in Richey v. AutoNation, Inc., an important clarification on when a court can overturn an arbitration award. Facts Plaintiff Richey worked as an at-will employee for defendant Power Toyota. His employment terms included acceptance of (1) a company policy that prohibited outside work while on approved medical leave and (2) an agreement to resolve any employment dispute through arbitration. The arbitration agreement provided that any decision would be “final and binding.” The agreement did not expressly provide that courts could review any arbitration award for legal error. Richey...

Case Background – Sanchez v. Valencia Holding Co.

Case Background – Sanchez v. Valencia Holding Co.

Sanchez v. Valencia Holding Co. – S214430 Issue Does the Federal Arbitration Act (9 U.S.C. § 2), as interpreted in AT&T Mobility LLC v. Concepcion (2011) 563 U.S. __ [131 S. Ct. 1740, 179 L.Ed.2d 742], preempt state law rules invalidating mandatory arbitration provisions in a consumer contract as procedurally and substantively unconscionable? Procedural History Opinion Below:  201 Cal.App.4th 74; Los Angeles County Superior Court; BC433634 Petition for review after the Court of Appeal affirmed an order denying a petition to compel arbitration.