November 26, 2012

Are you listening, California Supreme Court?

By Deborah J. La Fetra Senior Attorney

For the second time this year, the United States Supreme Court slapped down a state supreme court that refused to abide by the High Court’s arbitration decisions. In today’s unsigned opinion in Nitro-Lift Technologies, L.L.C. v. Howard, the miscreant tribunal this time was the Oklahoma Supreme Court, which struck down a noncompete agreement that contained an arbitration provision. Purporting to decide the case on “adequate and independent state grounds” to insulate the decision from Supreme Court review, the Oklahoma court shunted aside such controlling decisions as AT&T Mobility v. Concepcion (2011), which expressly forbids judicial hostility toward arbitration, and Buckeye Check Cashing, Inc. v. Cardegna (2006), which held that federal substantive arbitration law applies in both state and federal courts.

The Supreme Court pointedly explained that the Constitution explicitly ranks federal statutes and Supreme Court decisions above state law via the Supremacy Clause (Art. IV, cl.2): “It is this Court’s responsibility to say what a statute means, and once the Court has spoken, it is the duty of other courts to respect that understanding of the governing rule of law.” Rivers v. Roadway Express, Inc., 511 U. S. 298, 312 (1994).

The Oklahoma Supreme Court joins the West Virginia Supreme Court as a recipient of a public rebuke by the United States Supreme Court. The California Supreme Court currently has three arbitration cases pending, including Sanchez v. Valencia Holding Co., in which PLF filed an amicus brief. Will the California court take the hint?

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