California courts, like most federal courts, have historically held that a party does not waive its contractual right to compel arbitration unless the party opposing arbitration has been prejudiced by the moving party’s delay in seeking arbitration. However, last term in Morgan v. Sundance, Inc., the U.S. Supreme Court clarified that the Federal Arbitration
California Supreme Court Clarifies Discovery Limitations and Severability in Arbitration Agreements
The California Supreme Court issued its opinion in Ramirez v. Charter Communications, affirming in part that the arbitration agreement contained some substantive unconscionability but remanding the case to determine whether the agreement could be salvaged by severing the unconscionable provisions. In doing so, the California Supreme Court clarified its view on the enforceability of
California Court of Appeal Holds California’s Law Regarding Payment of Arbitration Fees Preempted by FAA
In 2019, California enacted Senate (SB) Bill 707, a law codified as California Code of Civil Procedure sections 1281.98 and 1281.99, that automatically deems an employer’s failure to pay fees required for the commencement or continuation of arbitration within 30 days of the payment’s due date a material breach of the arbitration agreement. A
PAGA Standing At Issue In California Supreme Court Oral Argument
On May 9, 2023, the California Supreme Court heard oral arguments in Adolph v. Uber to decide “[w]hether an aggrieved employee who has been compelled to arbitrate [their individual] claims under the [California Labor Code] Private Attorneys General Act (PAGA) . . . maintains statutory standing to pursue PAGA claims arising out of events involving
California Court of Appeal Stresses the Difference Between Substantive and Procedural Unconscionability for Arbitration Agreements
In a pair of cases decided by the Second Appellate District of the California Court of Appeal, the Court reiterated the difference between procedural and substantive unconscionability when it comes to invalidating arbitration agreements based on unconscionability: procedural unconscionability focuses on the fairness of the process leading to the formation of the agreement, whereas substantive
California Courts Provide Employers More Reasons to Review Their Arbitration Agreements
A pair of recent California Court of Appeal decisions serve as yet another reminder to employers of the difficulties that they potentially face when enforcing arbitration agreements in California and, as a result, the importance of drafting clear, precise arbitration agreements. The first case, Hernandez v. Meridian Management Services, LLC, reiterated the importance of
The “I Do Not Recall Signing” Defense to Arbitration Agreements Ruled Out by California Court of Appeal
Among the many challenges employers face in enforcing employment arbitration agreements in California are employees arguing that they are not bound by the agreement because they do not recall signing it, even when the agreement contains their signature. A California Court of Appeal decision recently shot down this argument, holding that an employee cannot evade
U.S. Supreme Court Denies Petition for Rehearing in Viking River Cruises, Inc. v. Moriana
On June 15, 2022, the U.S. Supreme Court ruled in Viking River Cruises, Inc. v. Moriana that bilateral arbitration agreements governed by the Federal Arbitration Act (FAA) may require arbitration of California Private Attorneys General Act (PAGA) claims on an individual basis only.
In early July, Moriana, the named plaintiff-employee at the center of Viking
California Supreme Court Accepts Invitation to Weigh In on Employment Arbitration Agreements & PAGA
On June 15, 2022, the U.S. Supreme Court ruled in Viking River Cruises, Inc. v. Moriana that bilateral arbitration agreements governed by the Federal Arbitration Act (FAA) may require arbitration of California Private Attorneys General Act (PAGA) claims on an individual basis only.
However, Justice Sotomayor’s concurring opinion in Viking River Cruises also seemingly included
U.S. Supreme Court Hears Oral Arguments on Waiver of PAGA Claims in Arbitration Agreements
In December 2021, the U.S. Supreme Court agreed to hear arguments in Viking River Cruises v. Moriana (Viking). The question presented in Viking is whether the Federal Arbitration Act (FAA) requires enforcement of a bilateral arbitration agreement providing that an employee cannot raise representative claims, including representative claims under California’s Private Attorneys General Act (PAGA)