We asked nearly 4 years ago if Armendariz (the key California Supreme Court case from 2004 on employment arbitration) was on a collision course with Concepcion (the US Supreme Court case from 2011). Concepcion said that the Federal Arbitration Act preempts state laws that “stand as an obstacle to the accomplishment and execution of the full purpose and objectives of [the FAA].” Armendariz, however, created numerous requirements that seem to violate that prohibition. (Can you say “modicum of bilaterality”?)
Given the number of issues facing the U.S. Supreme Court, it’s striking how often it finds it necessary to correct California’s interpretation of the FAA. It ended the last term doing so in DIRECTV Inc. v. Imburgia and appeared intent on doing the same near the start of this next term in MHN Government Services Inc. v. Zaborowski.
At the request of the Daily Journal (subscription required), I wrote an opinion piece about Zaborowski. In that case, the petitioners complain that California law since Armendariz applies a different standard to arbitration agreements in deciding whether to strike unlawful provisions and enforce the rest of the agreement or whether, instead, to strike the entire agreement. Oral argument in the case was set for February.
So, are Armendariz and Concepcion on a collision course? It sure looked that way. But the collision has been postponed. As of January 7th, the argument has been removed from the court’s calendar. It looks like the parties may have settled. (While that collision is no longer imminent, I like this image too much to change it.)