Category: Sanchez v. Valencia Holding Co.
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...
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,...
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.
