SCOTUS Allows California to Interpret Federal Arbitration Act As Excluding Private Attorney General Claims
Today, the U.S. Supreme Court denied the petition for certiorari in the Iskanian case from the California Supreme Court. In doing so, SCOTUS allowed one of the most interesting Federal Arbitration Act interpretations in recent years to stand. As you may recall, the decision held that the Federal Arbitration Act did not apply to labor code enforcement lawsuits brought by employees pursuant to California’s Private Attorneys General Act. The California court reasoned that those claims are really state enforcement actions, without any arbitration agreement governing the claims. This opens up a new line of argument for putative class actions — can they piggyback on Iskanian and argue that their lawsuit is properly viewed as public enforcement of a statute and therefore the arbitration agreement does not apply? It will be interesting to see if plaintiffs in other states make use of this decision.
[At least one arbitration case still has a certiorari petition pending: Opalinski.]