In Cook v. University of Southern California Cal. App. 5th 312, 340 (2024), reh’g denied (June 13, 2024) the California Court of Appeal, Second Appellate District, held that the arbitration clause in an employment agreement between an employee, Pamela Cook, and an employer, the University of Southern California, was unconscionable. This decision could have an important impact on future attempts to compel arbitration based on arbitration clauses in pre-existing agreements.
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Arbitration
In Hernandez v. Sohnen Enterprises Inc., 102 Cal. App. 5th 222 (2024), reh’g denied (June 3, 2024), review filed (June 28, 2024) the California Court of Appeal, Second Appellate Division, made several important findings regarding arbitration agreements. The court held that unless the parties’ arbitration agreement expressly selected California’s arbitration provisions, the Federal Arbitration Act (“FAA”) preempts California Civil Procedure section 1281.97 (part of the California Arbitration Act (“CAA”)). The Court also found that a superior court order allowing a party to withdraw from arbitration per section 1281.97 is immediately appealable as it is the functional equivalent of an order denying arbitration.
Read MoreIn Smith v. Spizzirri, the Supreme Court of the United States unanimously held that, when a district court grants a motion to compel arbitration, Section 3 of the Federal Arbitration Act requires district courts to stay the lawsuit pending arbitration. While at first blush this question may appear highly technical, it resolves a deep circuit split among the federal courts of appeals and will have widespread impact on arbitration practice.
Read MoreThe United States Court of Appeals for the Ninth Circuit recently vacated a district court order approving a $5.2 million class action settlement between a plaintiff and Tinder, Inc., the mobile dating app. The Ninth Circuit reasoned that because the plaintiff was subject to binding arbitration, while thousands of other class members were not, she was not an adequate representative of the putative settlement class.
Read MoreThe United States Court of Appeals for the Ninth Circuit recently held that plaintiffs who purchased products through defendants’ sporting goods websites were put on notice of arbitration provisions because the plaintiffs were presented with a conspicuous hyperlink to defendants’ terms of use containing those provisions.
Read MoreThe California Supreme Court decided Adolph v. Uber Technologies, Inc., No. S274671, 2023 WL 4553702 (Cal. July 17, 2023), in which it unanimously held that, when an employee is required to arbitrate his or her individual Labor Code claims against an employer, the employee still has standing to pursue a representative action on behalf of other employees under California’s Private Attorneys General Act (PAGA), Cal. Lab. Code §§ 2698 et seq.
Read MoreIn late June 2023, the U.S. Supreme Court handed down its decision in Coinbase, Inc. v. Bielski, No. 22-105, 599 U.S. __ (2023), holding that an automatic stay applies when a defendant appeals a district court’s denial of its motion to compel arbitration—a significant development in arbitration law and federal appellate procedure.
Read MoreIn Brown v. TGS Management Co., LLC, the California court held that the arbitrator exceeded his powers by failing to reach the merits of a statutory claim ….
Read MoreMany arbitration agreements contain a delegation clause – i.e., a clause delegating to an arbitrator the determination of whether a dispute is subject to arbitration.
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