AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011), set substantial restrictions on state laws limiting the enforceability of arbitration agreements governed by the Federal Arbitration Act. Since then, the U.S. Supreme Court has carried on removing obstacles to arbitration imposed by lower courts, and California courts have begun addressing whether judicially-created impediments to arbitration survive Concepcion. This year in California, arbitration law saw the continuing consequences of Concepcion, with the U.S. Supreme Court once again striking down a barrier to arbitration erected by a lower court, the California Supreme Court interpreting Concepcion for the first time, and a growing divide among California courts of appeal over Concepcion‘s impact on California arbitration law in employment cases.
Scope of the “vindication” exception to the FAA
The most significant development this year was the U.S. Supreme Court’s decision in American Express Co. v. Italian Colors Restaurant, 133 S. Ct. 2304 (2013), which addressed the extent to which arbitration agreements need not be enforced if they fail to vindicate federal statutory rights. The FAA requires courts to enforce arbitration agreements according to their terms, but decades ago the U.S. Supreme Court indicated in dicta that courts may have authority to invalidate arbitration agreements if they fail to vindicate federal statutory rights.
