False Alarm? The Practical Impact of AB 51, California’s New Anti-Arbitration Statute

On October 10, 2019, California Governor Gavin Newsom signed into law a state statute purporting to prohibit employers from requiring employees to enter into certain types of arbitration agreements. This new law is creating significant uncertainty and anxiety among employers. What is the practical impact of AB 51 in light of its possible preemption by the Federal Arbitration Act (FAA) and other potential challenges to its limits on arbitration?

Answers to 10 Questions About California’s Ban on Mandatory Arbitration of Statutory Employment Claims

California is set to become the only state to outlaw predispute mandatory arbitration of statutory employment claims. On October 10, 2019, Governor Gavin Newsom signed California Assembly Bill (AB) 51, which prohibits employers from requiring employees to arbitrate claims arising under the California Fair Employment and Housing Act (FEHA) and related employment statutes.

Arizona Municipalities Retain Authority to Enact Benefits Ordinances After State High Court Denies Review

In February 2019, the Arizona Court of Appeals, Division One ruled that the Arizona State Legislature overstepped its authority in 2016, when it prohibited Arizona cities and other municipalities from enacting their own employee benefits ordinances. On August 27, 2019, the Arizona Supreme Court denied review of the Court of Appeals decision.

The Beginning of the End for 401(k) Class Actions? Ninth Circuit Enforces Individual Arbitration

In Dorman v. Charles Schwab Corp., No. 18-15281 (August 20, 2019), the Ninth Circuit Court of Appeals recently held that a 401(k) plan participant was required to individually arbitrate his claims regarding the plan’s fees and investment options, pursuant to the plan’s arbitration provision.

Fifth Circuit Rules that Courts, Not Arbitrators, Decide “Gateway Issue” of Class Arbitrability

In 20/20 Communications, Inc. v. Crawford, the U.S. Court of Appeals for the Fifth Circuit recently ruled that the question of whether a dispute can be arbitrated on a class-wide basis is a threshold issue that is presumptively for a court, not an arbitrator, to decide. This is the latest in a series of decisions by the Supreme Court of the United States and courts of appeals in favor of arbitration agreements that waive class procedures.

Supreme Court Concludes “Wholly Groundless” Exception Is Inconsistent With Federal Arbitration Act

On January 8, 2019, the Supreme Court of the United States decided whether courts may disregard contractual language calling for an arbitrator to decide questions of arbitrability if the argument that the arbitration agreement applies to the particular dispute is “wholly groundless.” The Court ruled that a “wholly groundless” exception is inconsistent with the Federal Arbitration Act (FAA), and courts are not free to override the terms of parties’ agreements to arbitrate.

Seventh Circuit Joins Sister Circuits in Holding That Courts, not Arbitrators, Should Decide the Availability of Class Arbitration

In a matter of first impression before the Seventh Circuit Court of Appeals involving an issue left open by the Supreme Court of the United States, a Seventh Circuit panel issued an opinion on a key threshold question of class arbitrability. The question was who decides—a court or an arbitrator—whether arbitration can proceed on a class or collective basis.

An Epic Checklist: What to Consider When Adopting Class Action Waivers in Employment Arbitration Agreements

In Epic Systems Corporation v. Lewis, the Supreme Court of the United States held that class action waiver in an employment arbitration agreement are enforceable. Yet, arbitration agreements containing such waivers may still be challenged on a variety of grounds. The law in this area is often unsettled or unclear and changes frequently. The following checklist identifies key issues employers may want to consider when adopting a class action waiver in an employment arbitration agreement.

Missouri Supreme Court Punts Two Lawsuits in a Row, on Direct Flights to Arbitration

Arbitration agreements have faced tackles and turbulence in a series of cases litigated in Missouri courts over the past few years. In the fall of 2017, the Supreme Court of Missouri issued two favorable arbitration agreement decisions: one involved an aviation school, the other arose from a training facility lease with the Rams football team, which has since left Missouri for California and was previously involved in a different arbitration-related case in Missouri.