Uber Technologies, Inc., et al. v. Johnathon Gregg

The Federal Arbitration Act (“FAA”) provides that arbitration agreements “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. In Epic Systems Corp. v. Lewis, 138 S. Ct. 1612 (2018), this Court held that the FAA “protect[s]” individual arbitration agreements “pretty absolutely,” and requires courts “to enforce, not override, the terms of [an] arbitration agreement[]” “providing for individualized proceedings.” Id. at 1619, 1621, 1623. Courts in California have created a broad but unwritten exception to the FAA’s otherwise “emphatic directions.” Epic Sys., 138 S. Ct. at 1621. According to the California Supreme Court, claims arising under the California Labor Code Private Attorneys General Act (“PAGA”)—which threaten employers with massive penalties for even trivial legal violations—are wholly exempt from the FAA, and agreements calling for individual arbitration are therefore unenforceable as to PAGA claims. See Iskanian v. CLS Transp. L.A., LLC, 59 Cal. 4th 348, 360 (2014). The Ninth Circuit upheld this conclusion in Sakkab v. Luxottica Retail North America, Inc., 803 F.3d 425 (9th Cir. 2015). And both courts have declined to reassess this conclusion after Epic Systems. The question presented is: Whether agreements calling for individual arbitration are enforceable under the Federal Arbitration Act with respect to claims asserted under the California Labor Code Private Attorneys General Act.