Automobiles, Nonsignatories: Fourth Dist. Div. 2 Rejects Equitable Estoppel Doctrine Of Felisilda
One More California Appellate Case Rejects Felisilda.
We have written before about courts rejecting the application of the equitable estoppel doctrine to allow vehicle manufacturers to piggyback on to the arbitration provision in sales contracts between customers and automobile dealerships. In Davis v. Nissan North America, Inc. v. Nissan North America, Inc., D083006 (4/1 3/15/24) (Buchanan, Do; Irion dsst) an automobile manufacturer and an authorized vehicle repair facility tried to take advantage of the arbitration agreement in the dealership contract, even though the manufacturer and the repair facility were not signatories to the arbitration agreement. Once more, the Court of Appeal rejected the equitable estoppel doctrine of Felisilda that would have allowed nonsignatories to rely on the arbitration agreement.
Justice Irion dissented, relying on the equitable estoppel doctrine.
Arbitrability, Delegation: When Two Arbitration Contracts Conflict, Court Decides Which One Supersedes The Other
The Supreme Court Does Not Decide Whether The Ninth Circuit's Decision Was Correct, Only Whether The Decision Was For The Court To Make.
The parties "had executed two contracts: the User Agreement, which sent disputes about arbitrability to arbitration, and the Official Rules, which appeared to send disputes to California courts." Coinbase, Inc. v. Suski, No. 22-3 (S. Ct. 5/23/24). The Official Rules governed a sweepstakes to enter for a chance to win Dogecoin, and in fact, respondents had entered the sweepstakes. The Ninth Circuit held that the Official Rules, which sent disputes to California courts, superseded the User Agreement which would have delegated arbitration and arbitrability matters to an arbitrator. The United States Supreme Court affirmed.
However, the Supreme Court ruling is narrow. It does not decide whether the Ninth Circuit was correct. Rather, as Justice Ketanji Brown Jackson explains, "We granted certiorari to answer the question of who—a judge or an arbitrator—should decide whether a subsequent contract supersedes an earlier arbitration agreement that contains a delegation clause." All the Supreme Court decides is that in a case where there are multiple agreements that conflict over whether the dispute is to be arbitrated, a court decides which agreement prevails.
Justice Neil Gorsuch concurred with the understanding that the Court was not deciding whether the Ninth Circuit was applying contract principles correctly.
Stay: US Supreme Court Holds That Stay Means Stay
Overruling A Ninth Circuit Decision (62 F.4th 1201 (2023).
Though the plain language of the Federal Arbitration Act appeared to require a district court to stay a lawsuit pending arbitration rather than dismiss it, the Ninth Circuit ruled that case law allowed district courts to dismiss the lawsuit when all claims are subject to arbitration. The Supreme Court reversed in Smith v. Spizzirri, no. 22-1218 (5/16/2024). Justice Sonia Sotomayor penned the Court's unanimous opinion, writing: "Just as 'shall' means 'shall,' 'stay' means 'stay.'"
Legislation: SB 1141 Would Raise Amount For Court-Ordered Mediation; AB 1903 Will Assist International Commercial Arbitration
Mediation.
Generally, we have little to say on our ADR blog about mediation, because key issues, such as the scope of confidentiality, are settled law. But there is a noteworthy Senate Bill, SB 1141 which, when it passes through all legislative hoops, will impact mediation. Currently, the superior courts cannot order a matter to mediation if the amount in controversy exceeds $50,000. SB 1141, which passed in the Senate Judiciary Committee 11-0, would raise the amount in controversy to $150,000.
Shout-out to Ellie Vilendrer, an Orange County ADR neutral and state and federal court panel mediator, who has been a forceful proponent of this legislation.
Arbitration.
AB 1903 will be a welcome addition to the arbitration framework in international commercial disputes. The current framework provides that arbitration agreements can be found in various written agreements. The proposed legislation provides an arbitration agreement can be contained in an exchange of electronic mail or in an electronic communication if the information contained is accessible so as to be usable for subsequent reference. Additionally, the bill clarifies the meaning interim measures of protection that an arbitral tribunal can issue before a final award. AB 1903, which has passed the Assembly and the Senate, awaits the Governor's signature.
Book Review: Citizen Justice: The Environmental Legacy Of William O. Douglas
Public Advocate And Conservation Champion.
My book review of the Hon. M. Margaret McKeown's The Environmental Legacy of William O. Douglas Public Advocate and Environmental Champion appears in the April 2024 issue of Los Angeles Lawyer. You can also read the review here: Download Citizen Justice.
Arbitration, FAA, Transportation Workers: SCOTUS Holds Transportation Worker Exemption Applies To What Workers Do, Not Who They Work For
A 9-0 Opinion Authored By Justice John Roberts.
Wonder Bread Store, B-80, Rock Springs, Wyoming. Photographer: John Margolies. 2004. Library of Congress. No known restrictions.
The Supreme Court, in a unanimous decision, holds: "A transportation worker need not work in the transportation industry to fall within the exemption from the FAA provided by §1 of the Act." Bissonnette v. LePage Bakeries, 23-51_6647 (Sup. Ct. 4/12/24) (Roberts, J.).
Section 1 of the FAA exempts transportation workers from mandatory arbitration. The issue in Bissonnette was whether transportation workers are workers who work for employers in the transportation industry, as the District Court majority and the Second Circuit had ruled, or whether transportation workers are defined by what they do. Justice Roberts explains that transportation workers are defined by what they do.
We have written about the FAA exemption for transportation workers before. See our sidebar category Transportation Workers.
BONUS: Baby Boomers may remember advertisements for Wonder Bread, the white bread that made you grow 12 ways. Wonder Bread is one of the "flagship products" of defendant/respondent Flower Foods, Inc., "which it promotes with a 95-foot-tall hot air balloon and a parade float called The Wondership."