Yesterday, the Supreme Court held in Viking River Cruises, Inc. v. Moriana (pdf) that the Federal Arbitration Act preempts a California rule invalidating arbitration agreements that provide for arbitration of an employee’s own claims under California’s Private Attorney General Act (PAGA), but waive the employee’s ability to assert PAGA claims affecting others.

The decision is enormously important to companies seeking to enforce workplace arbitration agreements in California. The decision also provides businesses with powerful arguments that California laws restricting arbitration in the consumer setting are preempted as well. (Disclosure: we filed an amicus brief (pdf) in support of the petition

Continue Reading Supreme Court strikes down California rule barring individualized arbitration of California PAGA claims

In AT&T Mobility LLC v. Concepcion, the Supreme Court held that the Federal Arbitration Act (“FAA”) preempts state-law rules barring enforcement of an arbitration agreement if the agreement does not permit the parties to utilize class procedures in arbitration or in court. Before Concepcion, the law of California included that limitation on the enforceability of arbitration agreements, but Concepcion declared that rule invalid as a matter of federal law. Yesterday, in DIRECTV, Inc. v. Imburgia (pdf), the Supreme Court held that Section 2 preempts a state-law interpretation of an arbitration agreement based on a legal rule that the state’s courts had applied only in the arbitration context, concluding that the state-law ruling “does not rest ‘upon such grounds as exist . . . for the revocation of any contract.’”

(We filed an amicus brief on behalf of the U.S. Chamber of Commerce in support of DTV.)Continue Reading Supreme Court Holds that Federal Arbitration Act Preempts California Court’s Interpretation of Arbitration Clause

What’s the difference between claiming that a food product is improperly certified as organic and claiming that the producer was properly certified but the product isn’t really organic? A unanimous California Supreme Court held in Quesada v. Herb Thyme Farms, Inc. (pdf) that state courts and juries should figure out the answer.  That ruling opens the door to state-law actions that challenge food producers’ compliance with the federal organic food product certification and labeling scheme, so long as the claims don’t take issue with the original certification decision.  The decision revived a consumer class action alleging that a food
Continue Reading California Supreme Court Holds That Federal Organic Food Labeling Regime Does Not Preempt Claims of “Intentional” Mislabeling

Plaintiffs’ lawyers love to challenge products labeled as “natural,” with hundreds of false advertising class actions filed in just the last few years. Recently, in Astiana v. Hain Celestial (pdf), the Ninth Circuit reversed the dismissal of one such class action, and in doing so, addressed some key recurring arguments made at the pleading stage in litigation over “natural” labeling.

The Hain Celestial Group makes moisturizing lotion, deodorant, shampoo, conditioner, and other cosmetics products. Hain labels these products “All Natural,” “Pure Natural,” or “Pure, Natural & Organic.” A number of named plaintiffs, including Skye Astiana, filed a putative nationwide class
Continue Reading Ninth Circuit Upholds FDA’s Primary Jurisdiction Over “Natural” Labeling On Cosmetics But Orders Stay Rather Than Dismissal

As readers of this blog know, prior to the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion, the California Supreme Court (and a number of other state courts) had declared that waivers of class-wide arbitration were unenforceable as a matter of state law. But in Concepcion, the Supreme Court held that the Federal Arbitration Act (“FAA”) preempts state-law rules requiring the availability of class-wide arbitration.

How do the FAA and the Supremacy Clause of the U.S. Constitution affect the interpretation of arbitration clauses written prior to Concepcion? The Supreme Court may provide further guidance on that
Continue Reading Supreme Court Grants Certiorari To Address Interplay of Federal Arbitration Act And State-Law Savings Clause In Arbitration Agreement

After the oral argument in POM Wonderful LLC v. Coca-Cola Co. (pdf), No. 12-761, the Supreme Court appeared all but certain to allow competitors to sue for false advertising under the Lanham Act over labels of FDA-regulated food products.  Food manufactures have been waiting to see just how broad the ruling would be and whether it would affect the onslaught of consumer class actions challenging food and beverage labels.  The wait is over, and the POM v. Coke decision, while effecting a dramatic change in competitor actions, should have little impact on consumer class actions.

As described by the Supreme
Continue Reading POM v. Coke Does Not Alter The Landscape for Food False Advertising Class Actions

The plaintiffs’ bar continues to file consumer class actions challenging food and beverage labels en masse, especially in the Northern District of California—also known as the “Food Court.” One particular line of cases—at least 52 class actions, at last count—targets companies selling products containing evaporated cane juice. The battle over evaporated cane juice has become the latest front in the war over whether federal courts should apply the primary-jurisdiction doctrine and dismiss or stay food class actions while awaiting guidance from the federal Food and Drug Administration.

In these cases, plaintiffs allege that the term “evaporated cane
Continue Reading Primary Jurisdiction is Gaining Some Weight in the Food Court

The federal Food Drug and Cosmetic Act (“FDCA”)—along with the implementing regulations promulgated by the FDA—sets out a detailed national standard for much of what appears on food and beverage labeling. See 21 U.S.C. §§ 301, et seq.; 21 C.F.R. §§ 101, et seq.; Pom Wonderful LLC v. Coca-Cola Co., 679 F.3d 1170, 1175 (9th Cir. 2012). This national labeling law expressly preempts states from enacting different requirements for labels, including requirements imposed by courts under the guise of redressing a “misleading” or “fraudulent” label. 21 U.S.C. § 343-1; Turek v. Gen. Mills, Inc.,
Continue Reading Are State-Law Claims for Violating Federal Food Labeling Law Preempted?

On Friday, the Supreme Court granted review in three consolidated cases: Chadbourne & Parke LLP v. Troice, No. 12-79, Willis of Colorado v. Troice, No. 12-86, and Proskauer Rose LLP v. Troice, No. 12-88. The Court’s decision will clarify when the federal Securities Litigation Uniform Standards Act (“SLUSA”) preempts state-law securities class actions.

After Congress tightened the pleading and proof requirements for class actions under the federal securities laws in 1996 in the Private Securities Litigation Reform Act, plaintiffs fled to state court and started bringing securities class actions under state law. In response to this evasion,
Continue Reading Supreme Court to Decide Scope of Preemption of State-Law Securities Class Actions by SLUSA