California Supreme Court says arbitration clauses that bar injunctive relief are unenforceable

Posted on: April 6th, 2017 by Steve Larson
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On April 6, 2017, the California Supreme Court unanimously held that an arbitration agreement that waives the right to public injunctive relief is contrary to California public policy and therefore is unenforceable under California law. The decision reverses an appellate court’s interpretation that the U.S. Supreme Court’s Concepcion decision preempts state-law arbitration rules.

The California Supreme Court was deciding whether Citibank can force arbitration of a class of consumers injunctive relief claims. The California Supreme Court determined that public injunctive relief remained a remedy available to private plaintiffs under the state’s Unfair Competition and False Advertising Law, as well as under the Consumer Legal Remedies Act.