Comcast Cable Communications, LLC v. Charles Ramsey
Arbitration JusticiabilityDoctri ClassAction
Whether the FAA preempts California's McGill rule that renders standard arbitration agreements unenforceable when a consumer-plaintiff seeks to enjoin allegedly unlawful business practices
QUESTION PRESENTED Under the Federal Arbitration Act (FAA), arbitration agreements are “valid, irrevocable, and enforceable.” 9 U.S.C. § 2. Section 2’s “saving clause” contemplates exceptions only “upon such grounds as exist at law or in equity for the revocation of any contract.” Jd. But the FAA preempts even such grounds if they interfere with “fundamental attribute[s] of arbitration.” Epic Sys. Corp. v. Lewis, 584 U.S. 497, 508 (2018). In 2017, the California Supreme Court ruled that an arbitration provision waiving the ability to seek “public injunctive relief” in any forum is unenforceable. McGill v. Citibank, N.A., 393 P.3d 85 (Cal. 2017). More recently, the California courts have held that to trigger that rule, a plaintiff need only request an injunction under California’s Unfair Competition Law (UCL) or Consumers Legal Remedies Act (CLRA). The McGill rule thus renders standard arbitration agreements unenforceable under California law when a consumer-plaintiff seeks to enjoin virtually any allegedly unlawful business practice. The Ninth Circuit has held that the FAA would preempt such a sweeping rule—resulting in a square federal-state conflict. The question presented is: Whether the FAA preempts California’s McGill rule. (i)