Northern California Record

Monday, April 6, 2020

Attorney representing CalChamber says judge made right call in halting anti-arbitration bill


By Rich Peters | Jan 16, 2020


SACRAMENTO – California’s Assembly Bill 51, which aimed to limit the use of workplace arbitration agreements, is on hold following the California Chamber of Commerce winning a temporary restraining order from a federal judge on Dec. 30, just days before the bill was set to take effect.

The Chamber argued that AB 51 is preempted by the Federal Arbitration Act and Judge Kimberly Mueller of the U.S. District Court for the Eastern District of California found the argument compelling enough to issue the order. Opponents of Mueller's ruling argue that the state law focuses on events prior to the signing of arbitration pacts, so it doesn't conflict with the federal law.

“There are more than serious concerns and I think the court was correct to identify the concerns are serious enough to put the government enforcement of the law on hold until she’s able to consider the case on the whole preliminary junction,” said attorney Donald M. Faulk, who is working on the case. “The Supreme Court is wise to this and I think the 9th Circuit will be too – and I have full expectations that Judge Mueller will as well.”

In early December, a coalition of businesses, led by the California Chamber, filed a lawsuit to stop enforcement of the bill.

“It doesn’t make sense to place businesses at risk for criminal penalties for a practice that has been favored by California and federal law, and consistently upheld by the courts,” said Allan Zaremberg, president and CEO of the California Chamber of Commerce in a statement. “While it may not serve the best interests of the trial lawyers, expeditious resolution through the arbitration process serves the interests of employees and employers.”

A growing number of notable businesses, organizations and experts around the state share the same sentiments as the Chamber, eventually helping prompt Mueller to issue a temporary restraining order on the bill. Now the groups are making one final push to permanently block the bill.

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Organizations in this Story

California Chamber of Commerce