Rex Heinke Discusses California Supreme Court Arbitration Ruling on Daily Journal Podcast
In a recent episode of the Weekly Appellate Report podcast, Rex Heinke, co-head of Gump's Supreme Court and appellate practice, delved into the topic of class arbitration following the landmark case of Sandquist v. Lebo Automotive.
The Sandquist case has been a point of contention in the ongoing debate about how arbitration should function. According to Heinke, the California Supreme Court's ruling in this case marked another step in this ongoing disagreement.
The case centres around the question of who should decide whether class claims may be arbitrated - a court or an arbitrator. In the Sandquist v. Lebo Automotive case, the California Supreme Court ruled that an arbitrator, not a court, should make this decision.
This decision contrasts with the stance of every federal circuit court, which has come down on the opposite side regarding who decides whether class claims may be arbitrated.
Employers generally favour individual arbitration due to its quick, efficient, and cost-effective nature. However, the issue of class arbitration is a significant concern for employers because an arbitrator's decision is virtually unreviewable and cannot ordinarily be reversed on appeal.
Heinke advises employment lawyers writing arbitration agreements to use clear and express language regarding who is to decide class-wide arbitration. He does not see the 4-3 decision in the Sandquist v. Lebo Automotive case as indicating a trend of more 4-3 decisions by the California Supreme Court.
The decision in Sandquist v. Lebo Automotive is favourable to plaintiffs who want class-wide arbitration to be decided by arbitrators. However, according to Heinke, the issue of who decides whether class claims may be arbitrated is a prime candidate for the U.S. Supreme Court.
Given the current vacancy and ideological split, it may not be taken up at this stage. The ruling in Sandquist v. Lebo Automotive will undoubtedly have implications for future class arbitration cases, and it is a topic that will continue to be closely watched by legal professionals.
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