On April 27, 2011, the Supreme Court in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011), cleared the way for consumer products companies and other businesses to incorporate class action waivers into their arbitration agreements with customers.  On April 7, 2014, the Second District Court of Appeal in California affirmed the denial of a motion to compel arbitration despite Concepcion, relying on language in the arbitration clause that rendered the clause invalid if state law would find the class action waiver unenforceable.  The decision appears to contradict a recent Ninth Circuit decision, calling into question Concepcion’s scope and ensuring further litigation of the issue.

In Imburgia v. DirecTV, Inc., 170 Cal. Rptr. 3d 190 (2014), Plaintiffs accused DirecTV of improperly charging early termination fees and brought a class action against the company for false advertising, violation of California’s Consumer Legal Remedies Act (CLRA) and related claims.  After the trial court granted in part Plaintiffs’ motion for class certification, Concepcion came down and DirecTV moved to decertify the class and compel arbitration.  DirecTV’s arbitration clause included a class action waiver and provided generally that the Federal Arbitration Act (FAA) applied, but also provided:  “If, however, the law of your state would find this agreement to dispense with class arbitration procedures unenforceable, then this entire Section … is unenforceable.”  Id. at 193.
Continue Reading Recent California Appellate Opinion Raises Issue of Concepcion’s Scope