June 26, 2013
Last April, the California Supreme Court heard oral argument in Sonic-Calabasas A v. Moreno, an appeal which concerns the impact of the United States Supreme Court’s landmark arbitration decision in AT&T Mobility LLC v. Concepcion on California arbitration law.
Last Friday, the potential importance of Sonic-Calabasas grew even greater as the court called on the parties to file supplemental briefs addressing the significance of the U.S. Supreme Court’s recent arbitration decision in American Express Co. v. Italian Colors Restaurant. As we’ve explained, American Express clarified the so-called “vindication principle,” pursuant to which the U.S. Supreme Court has previously suggested that arbitration clauses need not be enforced if they operate as prospective waivers of a party’s right to pursue federal statutory claims. (We recently discussed the vindication principle at length in an amicus brief we filed on behalf of the California New Car Dealers Association in Iskanian v. CLS Transportation Los Angeles, another arbitration appeal pending before the California Supreme Court. That brief traces the origins of the vindication principle and its application by the California Supreme Court, and emphasizes that, after Concepcion, there can be no doubt that California’s policy to vindicate California statutory rights cannot override the Federal Arbitration Act’s mandate requiring courts to enforce arbitration agreements according to their terms.)
Sonic-Calabasas will now present the California Supreme Court with its first meaningful opportunity to address Concepcion and American Express’ effect on California law, although the court will also have an opportunity to do so in other pending arbitration appeals like Iskanian and Sanchez v. Valencia Holding Co. Under the new briefing schedule in Sonic-Calabasas, the parties must file their supplemental briefs by July 12 and any response to those briefs by July 19. The court’s order states the “cause” will then be “resubmitted on July 19, 2013.” This means that, while the court previously had until early July to file its opinion in Sonic-Calabasas, the court will now have an additional 90 days after July 19 to issue its opinion. So we’ll be on the lookout for what will likely be a highly-anticipated opinion in the late summer or early fall of 2013, although it’s still possible the court may issue its opinion in July shortly after the supplemental briefs are filed.
[Full disclosure: Horvitz & Levy has filed amicus briefs in support of the parties who moved to compel arbitration in Sonic-Calabasas, Sanchez, and Iskanian and presented oral argument before the California Supreme Court in support of the employer in Sonic-Calabasas.]