Arbitration, in the context of the law of the United States, is a form of alternative dispute resolution. Specifically, arbitration is an alternative to litigation through which the parties to a dispute agree to submit their respective evidence and legal arguments to a neutral third party for resolution. In practice arbitration is generally used as a substitute for litigation, particularly when the judicial process is perceived as too slow, expensive or biased. In some contexts, an arbitrator may be described as an umpire.
A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class action originated in the United States and is still predominantly an American phenomenon, but Canada, as well as several European countries with civil law, have made changes in recent years to allow consumer organizations to bring claims on behalf of consumers.
The Supreme Court of California is the highest and final court of appeals in the courts of the U.S. state of California. It is headquartered in San Francisco at the Earl Warren Building, but it regularly holds sessions in Los Angeles and Sacramento. Its decisions are binding on all other California state courts. Since 1850, the court has issued many influential decisions in a variety of areas including torts, property, civil and constitutional rights, and criminal law.
A forum selection clause in a contract with a conflict of laws element allows the parties to agree that any disputes relating to that contract will be resolved in a specific forum. They usually operate in conjunction with a choice of law clause which determines the proper law of the relevant contract.
Unconscionability is a doctrine in contract law that describes terms that are so extremely unjust, or overwhelmingly one-sided in favor of the party who has the superior bargaining power, that they are contrary to good conscience. Typically, an unconscionable contract is held to be unenforceable because no reasonable or informed person would otherwise agree to it. The perpetrator of the conduct is not allowed to benefit, because the consideration offered is lacking, or is so obviously inadequate, that to enforce the contract would be unfair to the party seeking to escape the contract.
The United States Arbitration Act, more commonly referred to as the Federal Arbitration Act or FAA, is an act of Congress that provides for judicial facilitation of private dispute resolution through arbitration. It applies in both state courts and federal courts, as was held in Southland Corp. v. Keating. It applies in all contracts, excluding contracts of seamen, railroad employees, or any other class of workers involved in foreign or interstate commerce, and it is predicated on an exercise of the Commerce Clause powers granted to Congress in the U.S. Constitution.
An arbitration clause is a clause in a contract that requires the parties to resolve their disputes through an arbitration process. Although such a clause may or may not specify that arbitration occur within a specific jurisdiction, it always binds the parties to a type of resolution outside the courts, and is therefore considered a kind of forum selection clause.
Armstrong I–VIII were a lengthy series of lawsuits and other legal actions, primarily in the California state courts, arising from Gerald Armstrong's departure from the Church of Scientology (COS). The COS argued that Armstrong, a former COS employee, improperly took private papers belonging to the Church, while Armstrong argued that he took the papers to protect himself from improper disciplinary proceedings and that the Church did, in fact, discipline him improperly.
Arbitration is a form of alternative dispute resolution (ADR) that resolves disputes outside the judiciary courts. The dispute will be decided by one or more persons, which renders the 'arbitration award'. An arbitration decision or award is legally binding on both sides and enforceable in the courts, unless all parties stipulate that the arbitration process and decision are non-binding.
The law of California consists of several levels, including constitutional, statutory, and regulatory law, as well as case law. The California Codes form the general statutory law, and most state agency regulations are available in the California Code of Regulations.
Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006), is a United States Supreme Court case concerning contract law and arbitration. The case arose from a class action filed in Florida against a payday lender alleging the loan agreements the plaintiffs had signed were unenforceable because they essentially charged a higher interest rate than that permitted under Florida law.
Southland Corp. v. Keating, 465 U.S. 1 (1984), is a United States Supreme Court decision concerning arbitration. It was originally brought by 7-Eleven franchisees in California state courts, alleging breach of contract by the chain's then parent corporation. Southland pointed to the arbitration clauses in their franchise agreements and said it required disputes to be resolved that way; the franchisees cited state franchising law voiding any clause in an agreement that required franchisees to waive their rights under that law. A 7-2 majority held that the Federal Arbitration Act (FAA) applied to contracts executed under state law.
AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011), is a legal dispute that was decided by the United States Supreme Court. On April 27, 2011, the Court ruled, by a 5–4 margin, that the Federal Arbitration Act of 1925 preempts state laws that prohibit contracts from disallowing class-wide arbitration, such as the law previously upheld by the California Supreme Court in the case of Discover Bank v. Superior Court. As a result, businesses that include arbitration agreements with class action waivers can require consumers to bring claims only in individual arbitrations, rather than in court as part of a class action.
Arbitration in the United States is governed by the Federal Arbitration Act of 1925, which requires courts to compel parties who agree to arbitration to participate in binding arbitration, the decision from which is binding upon the parties. Since the passage of the FAA, both state and federal courts have examined arbitration clauses, as well as other statutes involving arbitration clauses, for validity and enforceability.
14 Penn Plaza LLC v. Pyett, 556 U.S. 247 (2009), is a United States labor law case decided by the United States Supreme Court on the rights of unionized workers to sue their employer for age discrimination. In this 2009 decision, the Court decided that whenever a union contract "clearly and unmistakably" requires that all age discrimination claims under the Age Discrimination in Employment Act of 1967 be decided through arbitration, then employees subject to that contract cannot have those claims heard in court.
Disputes between consumers and businesses that are arbitrated are resolved by an independent neutral arbitrator rather than in court. Although parties can agree to arbitrate a particular dispute after it arises or may agree that the award is non-binding, most consumer arbitrations occur pursuant to a pre-dispute arbitration clause where the arbitrator's award is binding.
DIRECTV, Inc. v. Imburgia, 577 U.S. ___ (2015), was a case in which the Supreme Court of the United States clarified when arbitration provisions in contracts are governed by the Federal Arbitration Act. In a 6–3 opinion written by Justice Stephen Breyer, the Court reversed a decision by the California Court of Appeal that refused to enforce an arbitration agreement between DIRECTV and its customers. The California Court had ruled that the arbitration agreement was unenforceable because, under applicable California law, a class action arbitration waiver between DIRECTV and its customers was unenforceable. However, the Supreme Court of the United States held that the California Court of Appeal's interpretation was preempted by the Federal Arbitration Act, and the California Court of Appeal was therefore required to enforce the arbitration agreement.
Am. Express Co. v. Italian Colors Rest., 570 U.S. 228 (2013), is a United States Supreme Court case decided in 2013.
A class action waiver is a provision found in some contracts which prohibits a party from filing a class action legal proceeding against the other party, or both parties waiving the right to file class actions against each other. These clauses are most often found in the United States and agreements with American citizens.
The Private Attorneys General Act of 2004 (PAGA) is a California statute that authorizes aggrieved employees to bring actions for civil penalties on behalf of themselves, other employees, and the State of California against their employers for California Labor Code violations. PAGA's purpose is not to recover damages or receive restitution, but rather to allow citizens to act as private attorneys general and enforce the Labor Code. Because PAGA suits are fundamentally law enforcement actions, aggrieved employees must notify the Labor and Workforce Development Agency (LWDA)—the state agency that enforces California labor laws—of any alleged Labor Code violations. An aggrieved employee can only file a PAGA lawsuit after the LWDA elects not to pursue its own action against the employer.
