Articles Posted in Supreme Court of California

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Plaintiff opened a credit card account with Defendant Citibank, N.A. and purchased a credit protector plan. Defendant later amended the original agreement by adding an arbitration provision. The provision waived the right to seek public injunctive relief in any forum. The arbitration provision became effective in 2001. In 2011, Plaintiff filed this class action based on Defendant’s marketing of the Plan and the handling of a claim she made under it when she lost her job, alleging claims under the Consumers Legal Remedies Act (CLRA), the unfair competition law (UCL), and the false advertising law. Defendant petitioned to compel Plaintiff to arbitrate her claims on an individual basis pursuant to the arbitration provision. Based on the Broughton-Cruz rule, the trial court ordered Plaintiff to arbitrate all claims other than those for injunctive relief under the UCL, the CLRA, and the false advertising law. The Court of Appeal reversed and remanded for the trial court to order all of Plaintiff’s claims to arbitration, concluding that the Federal Arbitration Act preempts the Broughton-Cruz rule. The Supreme Court reversed, holding that the arbitration provision was invalid and unenforceable because it waived Plaintiff’s right to seek public injunctive relief in any forum. Remanded. View "McGill v. Citibank, N.A." on Justia Law

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When Plaintiff was hired by Defendants, he signed multiple arbitration agreements as a condition of employment. Plaintiff later sued Defendant, alleging racial discrimination, harassment, and retaliation. The complaint sought to bring claims on behalf of a “class of current and former employees of color.” Defendants filed a motion to compel individual arbitration based on the arbitration agreements. The trial court granted the motion but struck the class allegations, concluding that the agreements did not permit class arbitration. The court of appeal reversed in part, ruling (1) the trial court erred in concluding that existing precedent compelled the court to determine whether class arbitration was available; and (2) the availability of class proceedings under an arbitration agreement is for an arbitrator to decide in the first instance. The Supreme Court affirmed, holding (1) there is no universal rule allocating the decision of whether an arbitration agreement permits or prohibits classwide arbitration to a court or an arbitrator, but rather, who decides is in the first instance a matter of agreement with the parties’ agreement subject to interpretation under state contract law; and (2) under state law, the arbitration agreement in this case allocates the decision to the arbitrator. View "Sandquist v. Lebo Automotive, Inc." on Justia Law

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As a condition of her employment with Defendants, Plaintiff signed an agreement to resolve any employment-related disputes through arbitration. After Plaintiff resigned, she filed a complaint against Defendants, alleging that she suffered harassment, discrimination, and retaliation during the course of her employment. Defendants filed a motion to compel arbitration. Plaintiff opposed the motion, asserting that it was unconscionable. The trial court agreed with Plaintiff and denied the motion to compel arbitration. The court of appeal reversed. The primary issue before the Supreme Court was whether the arbitration agreement was unconscionable because of a clause in the agreement providing that, in the event a claim proceeds to arbitration, the parties are authorized to seek preliminary injunctive relief in the superior court. The Supreme Court affirmed, holding that the arbitration agreement was not unconscionable because the clause did no more that restate existing law. View "Baltazar v. Forever 21, Inc." on Justia Law