Court Opinion

ID: 3179078
Source: CourtListenerOpinion
Date Created: 2016-02-19 21:07:30.93858+00
Date Added: 2024-06-11T07:38:55.319607
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                           FEB 19 2016
                    UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

MICHAEL HOPKINS, an individual , on              No. 13-56126
behalf of himself, and on behalf of all
persons similarly situated,                      D.C. No. 8:13-cv-00103-AG-RNB

              Plaintiff - Appellant,
                                                 MEMORANDUM*
  v.

BCI COCA-COLA BOTTLING
COMPANY, OF LOS ANGELES, a
Delaware Corporation,

              Defendant - Appellee.

                   Appeal from the United States District Court
                      for the Central District of California
                   Andrew J. Guilford, District Judge, Presiding

                        Argued and Submitted June 3, 2015
                              Pasadena, California

Before: M. SMITH and N.R. SMITH, Circuit Judges and LEFKOW,** Senior
District Judge.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
       **
             The Honorable Joan Lefkow, Senior District Judge for the U.S.
District Court for the Northern District of Illinois, sitting by designation.
      Michael Hopkins appeals the district court’s Order dismissing his California

Private Attorney General Act (PAGA) claim and granting a Motion to Compel

Arbitration. We have jurisdiction pursuant to 28 U.S.C. § 1291. We reverse and

remand to the district court for further proceedings.

      The central issue in this appeal turns on whether the Federal Arbitration Act

(FAA) preempts the California rule that “an employee’s right to bring a PAGA

action is unwaivable.” Iskanian v. CLS Transp. L.A., LLC, 327 P.3d 129, 148 (Cal.

2014). Although this issue has engendered considerable debate and divergence

among district courts, our recent decision in Sakkab v. Luxottica Retail North

America, Inc. held that “the FAA does not preempt the Iskanian rule.” 803 F.3d

425, 429 (9th Cir. 2015). Therefore, the Iskanian rule applies to the arbitration

agreement between Hopkins and BCI Coca-Cola Bottling Company of Los

Angeles (BCI) and Hopkins’s waiver of his right to bring a representative PAGA

action is unenforceable.

      BCI’s contention that the FAA requires enforcement of Hopkins’s waiver in

the arbitration agreement is foreclosed in light of our decision in Sakkab.

Although courts must generally enforce arbitration agreements according to their

terms, Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 U.S.

468, 478 (1989), the FAA permits arbitration agreements to be declared

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unenforceable “upon such grounds as exist at law or in equity for the revocation of

any contract,” 9 U.S.C. § 2. “[T]he Iskanian rule is a ‘generally applicable’

contract defense that may be preserved by § 2’s saving clause, provided it does not

conflict with the FAA’s purposes.” Sakkab, 803 F.3d at 433. The Iskanian rule

“does not conflict” with the objectives of the FAA and is not preempted. Id.

      An arbitration agreement is not per se unconscionable, and, in this

arbitration agreement, the offending clause waiving representative claims may be

severed from the rest of the agreement. The arbitration agreement states that “[t]he

invalidity or unenforceability of any provision shall not affect the application of

any other provision.” It is unclear whether Hopkins argued that this arbitration

agreement itself is unconscionable. In any case, he has not demonstrated such

unconscionability as it relates to the agreement as a whole.

      After severing the clause in the arbitration agreement that waives the right to

participate in representative actions, it is unclear whether the parties have agreed to

arbitrate such surviving claims or whether they must be litigated instead.1

Accordingly, we reverse the district court’s order dismissing Hopkins’s First

      1
        We note that the arbitration agreement states that “Since this Agreement is
intended to provide for the individualized resolution of claims, no provision of this
Agreement is to be construed to grant the arbitrator the authority to order
collective, representative or class arbitration.”

                                           3
Amended Complaint and remand to the district court to decide where Hopkins’s

representative PAGA claims should be resolved. See id. at 440 (remanding to the

district court to determine whether representative PAGA claims should be

arbitrated or litigated).

       REVERSED and REMANDED.

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