Federal Arbitration Act (FAA)

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Arzate v. Ace American Insurance Company, — Cal. Rptr. 3d — (2025) began as a familiar case: plaintiffs signed arbitration agreements (“Agreement”) with their employer that contained a class action waiver. But when a dispute arose, plaintiffs disregarded their Agreements and filed a class action lawsuit. The defendant filed a motion to compel arbitration. The trial court granted the motion, enforced the class action waiver, and stayed the action pending arbitration.Continue Reading Plaintiffs, Not Defendants, Must Initiate Arbitration

On February 3, 2025, the California First District Court of Appeal held that a party to an arbitration agreement cannot rely on a choice-of-law provision to wire around the federal Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the “EFAA”). The case, Casey v. Superior Court, clarifies that a party cannot circumvent the EFAA and compel a dispute to arbitration by using a pre-litigation choice-of-law provision.Continue Reading Choice-of-Law Provisions Cannot Circumvent Ending Forced Arbitration Act, Court of Appeal Rules

California’s Private Attorneys General Act (PAGA)[1] allows “aggrieved employees” to sue their employers for Labor Code violations to collect civil penalties “on behalf of himself or herself and other current or former employees.” The issue of how to resolve PAGA claims where the employee and employer are subject to a binding arbitration agreement has been hotly contested over the last several years, as reported many times in this blog [see here, here, and here].Continue Reading PAGA Plaintiffs Cannot Avoid Arbitration by Bringing a “Headless PAGA Lawsuit”

On March 12, 2024, the Ninth Circuit published a decision in Ortiz v. Randstad Inhouse Services, LLC, holding that the Plaintiff Adan Ortiz (“Plaintiff”) qualified as a “transportation worker” under the Federal Arbitration Act, and was thus exempted from mandatory arbitration under the FAA. The district court rejected the employer’s arguments that Plaintiff was bound by the arbitration mandate under the FAA because he performed duties on a purely local basis. This case continues to establish that the scope of the “transportation worker” exemption under the FAA is broader than only those workers that physically move goods or people across state lines, such as truck drivers and cargo pilots.Continue Reading Ninth Circuit Finds Shipping Warehouse Employee Qualified as Exempt “Transportation Worker” Under the Federal Arbitration Act

On May 16, 2024, the United States Supreme Court resolved a circuit split regarding whether Section 3 of the Federal Arbitration Act (“FAA”) provides trial courts the discretion to dismiss a lawsuit when all claims are subject to arbitration. In Smith v. Spizzirri, a unanimous Court ruled trial courts do not have discretion to dismiss a lawsuit that involves an arbitrable dispute, and must instead stay the proceedings.Continue Reading Supreme Court Rules Trial Courts Must Stay, Not Dismiss, Lawsuits During Arbitration

In the past few months, California Governor Newsom has signed numerous new employment laws affecting California employers of all sizes. Below is a summary of some of the laws going into effect in 2024.Continue Reading Looking Ahead: New California Employment Laws for 2024

On October 10, 2023, California Governor Newsom signed into law S.B. 365, a bill that amends California Code of Civil Procedure Section 1294. The new law provides that when a party appeals an order denying a motion to compel arbitration (an order which is immediately appealable), the trial court is not obligated to stay the action during the pendency of the appeal. The law marks a major shift in California civil procedure law.Continue Reading New California Law Prohibits Automatic Stay of Trial Court Action When Appealing Denial of a Motion to Compel Arbitration

On June 6, 2022, a unanimous United States Supreme Court issued another key decision interpreting the Federal Arbitration Act (“FAA”) that will have a significant impact on certain employers going…

Continue Reading United States Supreme Court Rules Certain Airline Employees Exempt From Federal Arbitration Act

As anticipated, on March 3, 2022, President Biden signed The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (H.R. 4445). The law takes effect immediately.

As explained in our prior blog, in a rare display of bipartisanship, on February 7, 2022, the House of Representatives overwhelmingly approved H.R. 4445 by a vote of 335 to 97. A few days later, on February 10, 2022, the Senate passed H.R. 4445, without amendment, by voice vote.Continue Reading UPDATE: President Biden Signs Bipartisan Bill to End Mandatory Arbitration of Sexual Harassment and Assault Claims in the Workplace

In a rare display of bipartisanship, Congress recently passed a new law that is poised to eliminate pre-dispute mandatory arbitration of sexual harassment and sexual assault disputes.
Continue Reading Congress Passes Bipartisan Bill to End Mandatory Arbitration of Sexual Harassment and Assault Claims in the Workplace

A divided Ninth Circuit panel dealt a blow to California employers recently in holding that a state law prohibiting mandatory arbitration agreements is largely not preempted by the Federal Arbitration Act (“FAA”).  California employers often have employees enter into such mandatory arbitration agreements as a condition of employment.
Continue Reading Ninth Circuit Upholds in Part California’s Ban on Mandatory Arbitration