Opposition Brief — Comcast Corporation, et al., Petitioners v. Charles E. Tillage, et al.

No. 19-1066

IN THE

Supreme Court of the United States

COMCAST CORPORATION, COMCAST CABLE

COMMUNICATIONS, LLC,

Petitioners,

v.

CHARLES TILLAGE, JOSEPH LOOMIS,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals for the Ninth Circuit

RESPONDENTS’ BRIEF IN OPPOSITION

MICHAEL W. SOBOL

ROGER N. HELLER

DANIEL E. SELTZ

AVERY S. HALFON

LIEFF CABRASER HEIMANN &

BERNSTEIN, LLP

275 Battery Street, 29th Floor

San Francisco, CA, 94111

(415) 956-1000

SCOTT L. NELSON

Counsel of Record

ALLISON M. ZIEVE

PUBLIC CITIZEN

LITIGATION GROUP

1600 20th Street NW

Washington, DC 20009

(202) 588-1000

snelson@citizen.org

DANIEL M. HATTIS

PAUL K. LUKACS

HATTIS & LUKACS

408 108th Ave. NE, Suite 500

Bellevue, WA 98004

(425) 233-8650

Attorneys for Respondents

April 2020

i

QUESTION PRESENTED

Whether the Federal Arbitration Act preempts

California decisional law applying general principles

of contract law to hold that, when a party has a statutory right to seek “public injunctive relief”—that is,

injunctive relief obtained by an individual that benefits the public generally—contractual agreements, including arbitration agreements, that purport to forbid

the plaintiff from seeking and obtaining such relief in

any forum are invalid.

ii

TABLE OF CONTENTS

QUESTION PRESENTED .......................................... i

TABLE OF AUTHORITIES ...................................... iii

INTRODUCTION ....................................................... 1

STATEMENT .............................................................. 3

A. The McGill Rule ............................................... 3

B. The Blair decision ............................................ 6

C. Facts and proceedings of this case .................. 8

REASONS FOR DENYING THE WRIT .................. 10

I.

The court of appeals’ holding does not conflict

with decisions of other courts of appeals or of

this Court............................................................ 10

II. Comcast’s request that the Court

fundamentally alter its FAA jurisprudence

does not merit review. ........................................ 15

III. The McGill rule does not impair consumer

arbitration in California. ................................... 27

IV. The McGill rule is not contrary to the FAA’s purposes and objectives. .......................................... 32

CONCLUSION.......................................................... 34

iii

TABLE OF AUTHORITIES

Cases

Page(s)

14 Penn Plaza LLC v. Pyett,

556 U.S. 247 (2009) ............................................. 11

Aanderud v. Super. Ct.,

221 Cal. Rptr. 3d 225 (Cal. Ct. App. 2017) ......... 28

Allied-Bruce Terminix Cos. v. Dobson,

513 U.S. 265 (1995) ............................................. 13

Am. Express Co. v. Italian Colors Rest.,

570 U.S. 228 (2013) ....................................... 12, 33

Arthur Andersen LLP v. Carlisle,

556 U.S. 624 (2009) ............................................. 13

AT&T Mobility LLC v. Concepcion,

563 U.S. 333 (2011) ...................................... passim

Bekele v. Lyft, Inc.,

918 F.3d 181 (1st Cir. 2019) ................................ 23

Blair v. Rent-A-Center, Inc.,

928 F.3d 819 (9th Cir. 2019) ........................ passim

Bodine v. Cook’s Pest Control Inc.,

830 F.3d 1320 (11th Cir. 2016) ..................... 26, 27

Booker v. Robert Half Int’l, Inc.,

413 F.3d 77 (D.C. Cir. 2005) ............. 11, 23, 24, 27

Broughton v. Cigna Healthplans,

988 P.2d 67 (Cal. 1999) ................................. 4, 5, 6

Buckeye Check Cashing, Inc. v. Cardegna,

546 U.S. 440 (2006) ................................. 13, 14, 20

Colopy v. Uber Techs. Inc.,

2019 WL 6841218 (N.D. Cal. Dec. 16, 2019) ...... 30

iv

County of Middlesex v. Gevyn Constr. Corp.,

450 F.2d 53 (1st Cir. 1971) ............................ 21, 22

Cruz v. PacifiCare Health Sys., Inc.,

66 P.3d 1157 (Cal. 2003) ............................... 4, 5, 6

Dean Witter Reynolds, Inc. v. Byrd,

470 U.S. 213 (1985) ............................................. 19

DIRECTV Inc. v. Imburgia,

136 S. Ct. 463 (2015) ........................................... 14

Doctor’s Assocs., Inc. v. Casarotto,

517 U.S. 681 (1996) ....................................... 13, 20

EEOC v. Waffle House, Inc.,

534 U.S. 279 (2002) ............................................. 11

Eiess v. USAA Fed. Sav. Bank,

404 F. Supp. 3d 1240 (N.D. Cal. 2019) ......... 28, 29

Epic Sys. Corp. v. Lewis,

138 S. Ct. 1612 (2018) ............................. 13, 20, 23

Ferguson v. Corinthian Colleges, Inc.,

733 F.3d 928 (9th Cir. 2013) ............................. 4, 6

Five Star Sr. Living Inc. v. Mandviwala,

138 S. Ct. 2680 (2018) ......................................... 28

Gilmer v. Interstate/Johnson Lane Corp.,

500 U.S. 20 (1991) ............................................... 11

Greenley v. Avis Budget Group Inc.,

2020 WL 1493618

(S.D. Cal. Mar. 27, 2020) ............................... 27, 28

Gonzalez-Torres v. Zumper, Inc.,

2019 WL 6465283 (N.D. Cal. Dec. 2, 2019) ........ 28

Halcon Int’l, Inc. v. Monsanto Australia Ltd.,

446 F.2d 156 (7th Cir. 1971) ......................... 22, 25

v

Iskanian v. CLS Transp. L.A., LLC,

327 P.3d 129 (Cal. 2014) ............................... 27, 28

Jackson v. Payday Fin., LLC,

764 F.3d 765 (7th Cir. 2014) ............................... 23

Kimble v. Marvel Entm’t, LLC,

135 S. Ct. 2401 (2015) ......................................... 16

Kindred Nursing Ctrs. Ltd. P’ship v. Clark,

137 S. Ct. 1421 (2017) ..............7, 10, 13, 14, 20, 33

Kisor v. Wilkie,

139 S. Ct. 2400 (2019) ......................................... 16

McGill v. Citibank, N.A.,

393 P.3d 85 (Cal. 2017) ................................ passim

Mitsubishi Motors Corp. v. Soler

Chrysler-Plymouth, Inc.,

473 U.S. 614 (1985) ................................. 11, 12, 34

Murray v. United Food & Commercial

Workers Int’l Union,

289 F.3d 297 (4th Cir. 2002) ............................... 24

National R.R. Passenger Corp. v. Consol. Rail Corp.,

892 F.2d 1066 (D.C. Cir. 1990) ........................... 23

People ex rel. Brown v. Barenfeld,

21 Cal. Rptr. 501 (Cal. Ct. App. 1962) ................ 25

Perry v. Thomas,

482 U.S. 483 (1987) ............................................. 13

Preston v. Ferrer,

552 U.S. 346 (2008) ....................................... 12, 20

Prima Paint Corp. v. Flood & Conklin Mfg. Co.,

388 U.S. 395 (1967) ................12, 15, 18, 21, 22, 23

Rent-A-Center, West, Inc. v. Jackson,

561 U.S. 63 (2011) ......................................... 13, 20

vi

Rivera v. Uniqlo Calif., LLC,

2017 WL 6539016 (C.D. Cal. Sept. 8, 2017) ....... 28

Rodriguez de Quijas v. Shearson/

Am. Express, Inc.,

490 U.S. 477 (1989) ............................................. 11

Sakkab v. Luxottica Retail N. Am., Inc.,

803 F.3d 425 (9th Cir. 2015) ............................... 28

Shearson/Am. Express, Inc. v. McMahon,

482 U.S. 220 (1987) ....................................... 11, 19

Southland Corp. v. Keating,

465 U.S. 1 (1984) ................................................. 17

Supak & Sons Mfg. Co. v. Pervel Indus., Inc.,

593 F.2d 135 (4th Cir. 1979) ......................... 22, 23

Volt Info. Scis., Inc. v. Bd. of Trustees of

Leland Stanford Jr. Univ.,

489 U.S. 468 (1989) ............................................. 17

Statutes

Cal. Bus. & Prof. Code § 17500 .................................. 3

Cal. Civ. Code § 1599 ................................................ 26

Cal. Civ. Code § 1670.5 ............................................. 26

Cal. Civ. Code § 1689 ................................................ 25

Cal. Civ. Code § 1692 ................................................ 26

Cal. Civ. Code § 3513 ............................................ 4, 26

California Consumer Legal Remedies Act,

Cal. Civ. Code §§ 1750 et seq. ................................ 3

§ 1751 ..................................................................... 4

California Unfair Competition Law,

Cal. Bus. & Prof. Code §§ 17200 et seq. ................ 3

vii

Federal Arbitration Act,

9 U.S.C. §§ 1 et seq........................................ passim

§ 2 .................................................................. passim

§ 3 ......................................................................... 29

Other

H.R. 1423, 116th Cong (2019). ................................. 16

Uniform Commercial Code § 2-608 .......................... 25

Williston on Contracts (4th ed. 2019) ................ 25, 26

INTRODUCTION

California consumer-protection statutes entitle

plaintiffs in certain cases to the award of injunctive

relief that benefits the public generally, such as an order stopping false advertising. Longstanding principles of California law prohibit private contracts that

waive laws protecting the public. In McGill v. Citibank, N.A., 393 P.3d 85 (2017), the California Supreme Court applied these principles to hold that any

agreement, including an arbitration provision, that

purports to extinguish prospectively a person’s right

to seek public injunctive relief is invalid and unenforceable. Under McGill, pre-dispute arbitration provisions remain enforceable whether or not they provide for arbitration of public-injunction claims. McGill

affects only an agreement that leaves no forum for asserting such rights, and even then it allows enforcement of the rest of the agreement (including an arbitration provision).

In Blair v. Rent-A-Center, Inc., 928 F.3d 819 (9th

Cir. 2019) (Pet. App. 3a), a unanimous panel agreed

with the California Supreme Court that the Federal

Arbitration Act (FAA)—which requires generally that

arbitration agreements be enforced to the same extent

as other contracts—does not preempt McGill’s holding. Blair held that the McGill rule is a generally applicable contract defense, Pet. App. 16a–19a, and does

not interfere with the FAA’s objectives by disfavoring

or burdening arbitration, id. 19a–24a.

In this case, the Ninth Circuit applied Blair to hold

that a provision in petitioner Comcast’s arbitration

provision that purported to waive consumers’ rights to

pursue public injunctive relief in any forum is invalid

and unenforceable. Id. 2a. Here, the consequence of

2

that holding was that Comcast’s arbitration provision

was invalid, but only because Comcast specified that

the invalid waiver provision could not be severed from

the remainder of the arbitration clause, not because

McGill by itself would require that result.

Comcast requests that this Court review the lower

court’s holding, but does not claim there is any conflict

among the lower courts over whether the McGill rule

is preempted. Nor does Comcast identify any decision

of this Court, or any other court, holding that the FAA

requires enforcement of an agreement that, instead of

requiring arbitration of a substantive claim, purports

to waive the claim altogether.

Instead, Comcast argues that the lower court erred

in ruling that the FAA allows courts to apply generally

applicable principles of state contract law to hold arbitration provisions invalid and unenforceable. That

claim rests in turn on a request that this Court alter

its own longstanding interpretation of the FAA and

hold, for the first time, that the FAA preserves only

state-law defenses involving contract formation. Comcast’s position is at odds with this Court’s decisions,

those of other circuits, and the FAA’s text. Comcast’s

assertion that the lower court erred by applying this

Court’s decades-long construction of the FAA does not

warrant review.

Comcast’s alternative argument, that this Court

should consider whether McGill interferes with the bilateral nature of arbitration, is equally meritless. As

Blair and McGill explain, a rule that the substantive

entitlement to public injunctive relief cannot be

waived in a consumer contract has no effect on

whether arbitration is bilateral: It merely ensures

that parties to bilateral proceedings—whether in

3

arbitration or court—can seek relief to which substantive law entitles them.

Finally, Comcast’s assertions, and those of its

amici, that McGill does away with consumer arbitration in California are flatly wrong. McGill does not

foreclose arbitration of consumer claims, nor does it

require or preclude arbitration of requests for public

injunctive relief. A company that wishes to arbitrate

consumer claims but not the award of public injunctive relief may require arbitration of liability issues

and other remedial issues while carving out the issue

of public injunctive relief for later resolution by a

court. A company may also require individual arbitration of public-injunction claims together with the rest

of a consumer’s claims. Many companies have crafted

valid and enforceable arbitration provisions reflecting

one of those choices. What a company may not do is

enforce an arbitration agreement—or any agreement—that prevents a plaintiff from seeking public

injunctive relief in any forum. Here, Comcast must litigate in court only because it drafted its agreement to

make its arbitration provision inseverable from the invalid public-injunction waiver. This Court need not

grant certiorari to spare Comcast the consequences of

its own contractual choices.

STATEMENT

A. The McGill Rule

California’s Consumer Legal Remedies Act

(CLRA), Cal. Civ. Code §§ 1750 et seq., together with

its Unfair Competition Law, Cal. Bus. & Prof. Code

§§ 17200 et seq., and its false advertising law, id.

§ 17500, provide substantive rights and remedies to

protect California consumers from unfair and deceptive business practices. The CLRA provides that any

4

agreement purporting to waive its protections is void

and unenforceable. Cal. Civ. Code § 1751. Another

longstanding California statute prohibits private

agreements that waive rights for the protection of the

public. Cal. Civ. Code § 3513.

Among the substantive rights afforded by California’s consumer protection laws is the entitlement to

obtain an injunction to stop unlawful acts directed at

the public at large, such as false advertising. Unlike

private injunctive relief, which is principally intended

to benefit individual plaintiffs or discrete classes of

similarly situated individuals, public injunctive relief

is intended primarily to benefit the general public and

only incidentally to benefit the individual plaintiff as

a member of the public. See McGill, 393 P.3d at 89. An

individual may seek such relief if she has suffered a

personal injury in fact, see id. at 92, and a request for

public injunctive relief does not, under California law,

require class or representative proceedings. Id. at 93.

In a pair of decisions predating AT&T Mobility

LLC v. Concepcion, 563 U.S. 333 (2011), the California

Supreme Court held that agreements requiring parties to arbitrate public-injunction claims were unenforceable. Broughton v. Cigna Healthplans, 988 P.2d

67 (1999); Cruz v. PacifiCare Health Sys., Inc., 66 P.3d

1157 (2003). Following Concepcion, the Ninth Circuit

held the Broughton-Cruz rule preempted because it

“prohibit[ed] outright the arbitration of a particular

type of claim.” Ferguson v. Corinthian Colleges, Inc.,

733 F.3d 928, 932 (2013) (quoting Concepcion, 563

U.S. at 341).

Later, in McGill, the California Supreme Court

considered a contract posing a different question regarding public injunctive relief. Rather than requiring

5

arbitration of public-injunction claims, the contract

prohibited their assertion in any forum at all. In a

unanimous opinion by Justice Chin, the court held

that the case did not present the Broughton-Cruz issue of whether agreements to arbitrate public-injunction claims are enforceable, because the parties had,

as the FAA permits, excluded such claims from their

arbitration agreement. See McGill, 393 P.3d at 90, 97.

Instead, the issue presented was whether the agreement was “valid and enforceable insofar as it purports

to waive McGill’s right to seek public injunctive relief

in any forum.” Id. at 90.

McGill held that under California contract-law

principles, which prohibit private agreements waiving

statutory rights that protect the public, an agreement

that purports to waive prospectively the right to seek

public injunctive relief is “invalid and unenforceable.”

Id. at 93. McGill further held that the FAA does not

preempt application of these contract-law principles to

an arbitration provision that purports to waive a claim

for public injunctive relief rather than requiring its arbitration. Adhering to this Court’s repeated statements that the FAA requires courts to “place arbitration agreements on an equal footing with other contracts” and permits them “to be declared unenforceable upon such grounds as exist at law and equity for

the revocation of any contract,” id. at 94 (quoting Concepcion, 563 U.S. at 339) (internal quotation marks

omitted), McGill explained that the rule against waivers of substantive rights created for public protection

was a general principle of California contract law applicable to “any contract—even a contract that has no

arbitration provision,” id. McGill also pointed out that

this Court has consistently stated that arbitration

6

under the FAA does not involve waiver of substantive

statutory rights. See id. at 95.

McGill rejected the argument that applying general California contract-law principles to invalidate a

public-injunction waiver would “disfavor[] arbitration” or “interfere[] with fundamental attributes of arbitration.” Id. at 96. The court noted that its holding

would not require parties to arbitrate claims for public

injunctive relief. The parties could exclude those

claims from arbitration and require arbitration of

other issues, including liability, leaving the issue of

public injunctive remedies for later litigation in court

if the plaintiff showed entitlement to relief. Id. at 97.

Finally, the McGill court found that the Citibank

agreement before it was unclear about whether the invalid waiver of public injunctive relief was severable

from the arbitration provision. The court accordingly

left that issue for resolution on remand. Id. at 98.

B. The Blair decision

In Blair, the Ninth Circuit considered an appeal

from a district court order holding that a provision in

an arbitration clause purporting to waive the right to

public injunctive relief was unenforceable under

McGill. In a published opinion, a unanimous panel

agreed with the California Supreme Court that the

FAA does not preempt the McGill rule. See Pet. App.

7a.

The court began its preemption analysis by recognizing that the McGill rule “is a generally applicable

contract defense” that governs both arbitration and

non-arbitration agreements. Id. 16a. Unlike the

Broughton-Cruz rule that the Ninth Circuit held

preempted in Ferguson, the McGill rule “shows no

hostility to, and does not prohibit, the arbitration of

7

public injunctions,” but “merely prohibits the waiver

of the right to pursue public injunctive relief in any

forum.” Id. 17a.

Blair further observed that the McGill rule was

unlike the rule this Court held preempted in Kindred

Nursing Centers Ltd. Partnership v. Clark, 137 S. Ct.

1421 (2017), which “hing[ed] on the primary characteristic of an arbitration agreement—namely a waiver

of the right to go to court and receive a jury trial.” Pet.

App. 18a (quoting Kindred, 137 S. Ct. at 1427). The

McGill rule, by contrast, does not turn on any attribute inherent to arbitration. And unlike the rule at issue in Kindred, the underlying contract-law basis of

McGill has repeatedly been applied to contracts other

than arbitration agreements: It “derives from a general and longstanding prohibition on the private contractual waiver of public rights” that “California

courts have repeatedly invoked … to invalidate waivers unrelated to arbitration.” Id. 18a (citing cases).

Blair also recognized that, under this Court’s FAA

decisions, even generally applicable contract principles may be preempted if they present an obstacle to

accomplishment of the FAA’s objectives. Id. 19a (citing

Concepcion, 563 U.S. at 341). Analyzing that issue,

Blair concluded that the McGill rule does not deprive

parties of arbitration’s benefits. Because public injunctive relief may be sought in wholly bilateral proceedings, the court explained that the McGill rule does

not require the procedural formalities of multiparty or

collective proceedings even if parties choose to arbitrate claims for public injunctive relief rather than

leaving them for judicial resolution (either of which

the McGill rule allows). See id. 20a. Moreover,

McGill’s non-waiver principle leaves parties free to

agree to whatever arbitral procedural rules they

8

choose, such as streamlined discovery rules. Id. 23a.

And issuing or implementing public injunctive relief

does not exceed the competency of arbitrators or involve “procedural complexities not already common to

the arbitration of private injunctions.” Id.

Blair acknowledged that claims for public injunctive relief may sometimes involve “substantive … complexity,” but held that “[a] state-law rule that preserves the right to pursue a substantively complex

claim in arbitration without mandating procedural

complexity does not frustrate the FAA’s objectives.”

Id. 21a. Similarly, the court noted that some claims

for public injunctions—like many claims not involving

public injunctions—may involve “lucrative business

practices” and “high stakes” for the defendant. Id. 24a.

However, absent “interfere[nce] with the informal, bilateral nature of traditional consumer arbitration,”

the court concluded that “high stakes alone do not

warrant FAA preemption” of a rule aimed only at preserving substantive rights. Id.

C. Facts and proceedings of this case

This case is one of two that were argued in conjunction with Blair and disposed of by unpublished opinions.1 In this case, respondents Charles Tillage and

Joseph Loomis, with two other plaintiffs, filed suit in

a California state court alleging that Comcast engages

in false and misleading advertising regarding the pricing of its cable television services, by pervasively advertising to the public prices considerably lower than

its actual prices and failing to disclose hefty surcharges. Their complaint sought, among other things,

––––––––––––––––––––––––

1 The other case is the subject of another pending petition for

certiorari, AT&T Mobility LLC v. McArdle, No. 19-1078.

9

injunctive relief to stop Comcast’s false and misleading advertising, for the benefit of the general public.

Comcast removed the case to federal court and

sought to compel Messrs. Tillage and Loomis to arbitrate their claims. Comcast’s subscriber terms, however, provide that “the arbitrator may award relief

only in favor of the individual party seeking relief and

only to the extent necessary to provide relief warranted by that individual party’s claims.” Pet. App.

41a (capitals omitted). Because Comcast’s terms also

require arbitration of all claims asserted by consumers, they do not allow the parties to seek public injunctive relief in any forum. And in contrast to most companies’ form contracts (which include severability

clauses), Comcast’s arbitration provision contains a

non-severability clause providing that the public-injunction waiver “is an essential part of this arbitration

provision and cannot be severed from it.” Id. 41a (capitals omitted). By contrast, all other parts of the arbitration provision are severable. See id. 41a–42a.

The district court denied Comcast’s motion to compel arbitration because the public-injunction waiver

was invalid and unenforceable under McGill, and because the arbitration provision’s own terms rendered

it entirely invalid if the waiver were unenforceable.

Comcast appealed. Following Blair, the court of appeals issued an unpublished affirmance. The court

held that Blair disposed of Comcast’s claims that the

FAA preempts the McGill rule, and that Comcast’s

“non-severability clause results in the invalidation of

the entire arbitration agreement.” Pet. App. 2a. Comcast petitioned for panel rehearing and rehearing en

banc. The panel denied rehearing, and no Ninth Circuit judge requested a vote on rehearing en banc.

10

REASONS FOR DENYING THE WRIT

I.

The court of appeals’ holding does not conflict with decisions of other courts of appeals or of this Court.

A. Comcast makes no pretense of claiming a direct

conflict among federal courts of appeals or state courts

of last resort over whether the FAA preempts the

McGill rule. The two courts that have addressed that

issue—the California Supreme Court and the Ninth

Circuit—both applied this Court’s FAA preemption jurisprudence and agreed that it does not require enforcement of arbitration provisions that waive the

right to public injunctive relief in any forum and are

thus invalid and unenforceable under California state

law. Both courts concluded that the McGill rule embodies generally applicable principles of contract law

that satisfy the FAA’s “equal-treatment principle,”

Kindred, 137 S. Ct. at 1426, because they do not discriminate overtly or covertly against arbitration. And

both agreed that the requirement that plaintiffs be allowed to seek public injunctive relief in some forum

does not pose an obstacle to achieving the FAA’s purposes and objectives because nothing about the requirement is inconsistent with arbitration’s bilateral

nature and procedural informality.

Comcast cites no decision of another circuit calling

Blair’s analysis into question or holding that the FAA

requires enforcement of arbitration agreements that

purport to waive substantive claims for relief in the

face of general contract-law principles under which

such waiver agreements are invalid. And Comcast

identifies no decisions from other states that have led

to disagreement over whether the FAA preempts the

sort of non-waiver rule adopted in McGill. Rather,

11

similarly to McGill and Blair, courts addressing arbitration agreements in other contexts have held that

the FAA does not require enforcement of waivers of

substantive claims for relief. See, e.g., Booker v. Robert

Half Int’l, Inc., 413 F.3d 77, 83 (D.C. Cir. 2005) (Roberts, J.) (holding arbitration agreement’s prohibition

on attorney’s fees to be invalid and unenforceable, but

severable). In the absence of any broad conflict over

the principles underlying Blair and McGill, the agreement of two courts concerning whether decisional law

of a single state is preempted does not require review

by this Court.

B. Blair and McGill are also fully consistent with

this Court’s decisions. This Court has never held that

the FAA requires enforcement of a purported waiver

of a substantive claim, and Comcast does not suggest

otherwise. Rather, this Court’s decisions enforcing arbitration agreements repeatedly emphasize that arbitration involves a choice of forum, not a waiver of

claims: “By agreeing to arbitrate a statutory claim, a

party does not forgo the substantive rights afforded by

the statute; it only submits to their resolution in an

arbitral, rather than a judicial, forum.” Mitsubishi

Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473

U.S. 614, 628 (1985); accord EEOC v. Waffle House,

534 U.S. 279, 295 n.10 (2002); Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 26 (1991); Rodriguez de Quijas v. Shearson/Am. Express, Inc., 490

U.S. 477, 481 (1989); Shearson/Am. Express, Inc. v.

McMahon, 482 U.S. 220, 229–30 (1987). An agreement

to arbitrate is not “a prospective waiver of the substantive right.” 14 Penn Plaza LLC v. Pyett, 556 U.S.

247, 265 (2009). Indeed, this Court has agreed that an

arbitration clause containing “a prospective waiver of

a party’s right to pursue statutory remedies” would be

12

“against public policy.” Mitsubishi, 473 U.S. at 637,

n.19.

In American Express Co. v. Italian Colors Restaurant, this Court held that a class-action ban in an arbitration agreement was enforceable even though its

practical effects might make particular claims too

costly for the plaintiffs, but reiterated that the FAA

does not require enforcement of arbitration agreements that waive statutory claims and remedies. 570

U.S. 228, 236–39 (2013). The Court explained that the

principle that an arbitration agreement may not foreclose assertion of substantive claims “finds its origin

in the desire to prevent ‘prospective waiver of a party’s

right to pursue statutory remedies.’” Id. at 236 (quoting Mitsubishi, 473 U.S. at 637 n.19). The Court

added: “That [principle] would certainly cover a provision in an arbitration agreement forbidding the assertion of certain statutory rights.” Id.

The principle that the FAA does not require enforcement of agreements forbidding assertion of

claims applies equally to state and federal claims.

This Court’s decisions, including Italian Colors, have

repeatedly stated that arbitration clauses may not

waive claims, without suggesting that state-law

claims differ in this respect. Indeed, in Preston v. Ferrer, this Court held that an arbitration agreement was

enforceable in part because the signatory “relinquishe[d] no substantive rights … California law may

accord him.” 552 U.S. 346, 359 (2008).

C. Blair and McGill are also consistent with this

Court’s repeated recognition that section 2 of the FAA

makes “arbitration agreements as enforceable as

other contracts, but not more so.” Prima Paint Corp.

v. Flood & Conklin Mfg. Co., 388 U.S. 395, 404 n.12

13

(1967). By providing that arbitration agreements

“shall be valid, irrevocable, and enforceable, save upon

such grounds as exist at law or in equity for the revocation of any contract,” 9 U.S.C. § 2, the FAA “establishes an equal-treatment principle: A court may invalidate an arbitration agreement based on ‘generally

applicable contract defenses’ like fraud or unconscionability, but not on legal rules that ‘apply only to arbitration or that derive their meaning from the fact that

an agreement to arbitrate is at issue.’” Kindred, 137

S. Ct. at 1426 (quoting Concepcion, 563 U.S. at 339).

This Court has repeatedly recognized that generally applicable state-law defenses to “[t]he validity of

a written agreement to arbitrate (whether it is legally

binding, as opposed to whether it was in fact agreed

to—including, of course, whether it was void for unconscionability)” are preserved by section 2’s saving

clause. Rent-A-Center, West, Inc. v. Jackson, 561 U.S.

63, 69 n.1 (2011); see also, e.g., Epic Sys. Corp. v.

Lewis, 138 S. Ct. 1612, 1622 (2018); Buckeye Check

Cashing, Inc. v. Cardegna, 546 U.S. 440, 444 (2006).

Thus, “the text of § 2 declares that state law may be

applied ‘if that law arose to govern issues concerning

the validity, revocability, and enforceability of contracts generally.’” Doctor’s Assocs., Inc. v. Casarotto,

517 U.S. 681, 686–87 (1996) (quoting Perry v. Thomas,

482 U.S. 483, 492–93 n.9 (1987)); accord Arthur Andersen LLP v. Carlisle, 556 U.S. 630–31 (2009). In

other words, “[s]tates may regulate contracts, including arbitration clauses, under general contact law

principles and they may invalidate an arbitration

clause ‘upon such grounds as exist at law or in equity

for the revocation of any contract.’” Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 281 (1995) (quoting 9 U.S.C. § 2).

14

Blair and McGill conscientiously apply these precedents, and their results are fully consistent with this

Court’s insistence that state laws “place[] arbitration

contracts ‘on equal footing with all other contracts.’”

DIRECTV Inc. v. Imburgia, 136 S. Ct. 463, 468 (2015)

(quoting Buckeye, 546 U.S. at 443). As those decisions

explain, the state law at issue here neither discriminates against arbitration “on its face” nor does so “covertly.” Kindred, 137 S. Ct. at 1426. Rather, California

has for more than a century applied its general prohibition against private agreements that waive public

rights “to invalidate waivers unrelated to arbitration.”

Blair, Pet. App. 18a (citing cases decided from 1896 to

2002). The California contract-law principle at issue is

not one applicable only “to arbitration agreements and

black swans”; it “in fact appl[ies] generally, rather

than singl[ing] out arbitration.” Kindred, 137 S. Ct. at

1428 & n.2.

Moreover, both Blair and McGill follow this

Court’s instruction in Concepcion that, in assessing

whether the FAA preempts state law, courts must look

beyond whether the law at issue satisfies the equaltreatment criterion and consider whether it stands as

an obstacle to fulfillment of the FAA’s purposes by imposing procedures incompatible with arbitration. See

Concepcion, 563 U.S. at 343. As both Blair and McGill

explain, even if companies respond to the McGill rule

by choosing to require arbitration of the issue of public

injunctive relief rather than carving it out of their arbitration clauses, the result will not alter arbitration’s

bilateral nature, interfere with parties’ rights to

choose discovery procedures, require any procedural

formalities inconsistent with arbitration, or exceed

the competencies of arbitration tribunals. See Blair,

Pet. App. 19a–24a; McGill, 393 P.3d at 97.

15

In sum, the preemption analysis applied in Blair

and McGill conflicts neither with decisions of other

courts of appeals and state supreme courts nor with

this Court’s precedents. Absent conflict among the circuits or misapplication of this Court’s holdings, certiorari is not warranted.

II. Comcast’s request that the Court fundamentally alter its FAA jurisprudence does

not merit review.

In light of the consistency of Blair and McGill with

this Court’s FAA decisions, Comcast asks this Court

to grant certiorari to adopt a new interpretation of the

FAA’s saving clause that departs from a half-century

of this Court’s FAA jurisprudence. Specifically, Comcast asserts that the FAA does not allow courts to

withhold enforcement of arbitration agreements on

the basis of contract-law doctrines that determine the

validity, revocability, and enforceability of contractual

provisions generally, but only on the basis of a subset

of contract-law doctrines that provide for rescission of

contracts based on contract-formation issues. Comcast

thus seeks to overturn this Court’s longstanding

recognition that the FAA makes arbitration agreements as enforceable, but no more enforceable, than

contracts generally, see Prima Paint, 388 U.S. at 404

n.12, and replace it with a doctrine that “elevate[s]

[arbitration agreements] over other forms of contract—a situation inconsistent with the ‘saving

clause,’” id.

The assertion that this Court’s longstanding construction of a statute is wrong does not merit review

absent a special justification demonstrating that the

basis for the construction has eroded over time

through the development of judicial doctrine or

16

further action by Congress and that it has proved unworkable in practice. See, e.g., Kimble v. Marvel

Entm’t, LLC, 135 S. Ct. 2401, 2410–11 (2015). Comcast makes no effort to show that these factors justify

the Court’s exercise of its discretionary jurisdiction.

This Court’s repeated acknowledgment, including in

recent cases, that generally applicable state-law contract principles determine the validity of arbitration

agreements refutes any notion that doctrinal developments support an alteration of the Court’s longstanding view. Nor has the Court’s approach proved unworkable in practice: Courts regularly apply this

Court’s longstanding interpretation to uphold and enforce arbitration agreements. Finally, Congress—

which always has the ability to alter this Court’s approach to statutory issues, see Kisor v. Wilkie, 139 S.

Ct. 2400, 2422 (2019)—has shown no sign that it

thinks this Court’s arbitration jurisprudence or interpretation of the FAA saving clause grants too much

deference to state contract-law doctrines.2

Even setting aside the heightened showing necessary to support a claim that the Court should grant

certiorari to correct its own longstanding statutory

construction, Comcast’s arguments for its proposed

reading of the FAA’s saving clause do not warrant review under the ordinary standards governing exercise

of this Court’s certiorari jurisdiction. First, the outcome below, and in McGill and Blair, can be sustained

without regard to the saving clause. The agreements

McGill holds invalid and unenforceable are not agreements to arbitrate claims for relief, but agreements to

––––––––––––––––––––––––

2 Pending legislative proposals reflect the opposite view. See,

e.g., H.R. 1423, 116th Cong. (passed by the House of Representatives, Sept. 20, 2019).

17

waive substantive rights altogether. Section 2 of the

FAA does not require enforcement of such an agreement regardless of its saving clause. Second, the construction of the saving clause in McGill and Blair does

not, in any event, conflict with decisions of this Court

or other circuits. Third, Comcast’s argument that the

plain meaning of the statute supports its position is

wrong.

A. Section 2 of the FAA makes an agreement to

“settle by arbitration a controversy” valid, irrevocable,

and enforceable, subject to the saving clause. See 9

U.S.C. § 2. Thus, this Court has held, the FAA provides for enforcement of an agreement “to arbitrate,”

Volt Info. Scis., Inc. v. Bd. of Trustees of Leland Stanford Jr. Univ., 489 U.S. 468, 474 (1989), and

“withdr[aws] the power of the states to require a judicial forum for the resolution of claims which the contracting parties agreed to resolve by arbitration.”

Southland Corp. v. Keating, 465 U.S. 1, 10 (1984). Section 2, however, says nothing about the enforcement

of an agreement that does not provide for arbitration

of a substantive matter, but instead purports to waive

a substantive right altogether. Nothing in section 2

withdraws the states’ power to require some forum for

the presentation of claims that parties have not

agreed to resolve by arbitration.

The McGill rule does not render an agreement to

arbitrate (or not to arbitrate) a controversy over the

availability of public injunctive relief unenforceable.

In fact, it does not bar enforcement of any agreement

to arbitrate anything. Nor does it prevent arbitration

over matters that the parties have agreed to arbitrate

from proceeding in accordance with their agreement,

as the FAA also requires. See Volt, 489 U.S. at 475.

Instead, it honors parties’ decisions to exclude or

18

include public injunctive relief from the scope of their

arbitration.

The only agreement that the McGill rule does not

allow a party to enforce is an agreement to waive altogether the right to obtain public injunctive relief in

any forum. Such an agreement is not within section

2’s enforcement mandate because it is not a provision

in a contract requiring that a matter be settled by arbitration, and it cannot be transformed into such an

agreement merely by embedding it in the same section

of a contract that contains provisions for arbitration.

It is a fundamental principle of this Court’s FAA jurisprudence that the enforcement of an agreement to arbitrate is an entirely separate matter from the enforcement of a contract’s substantive terms. See Prima

Paint, 388 U.S. at 402 (adopting the view that “except

where the parties otherwise intend[,] arbitration

clauses as a matter of federal law are ‘separable’ from

the contracts in which they are embedded”). Only

where a contract—like the one Comcast drafted

here—makes the agreement to arbitrate contingent

on the enforceability of the substantive waiver does

the McGill rule have the indirect consequence if preventing arbitration. That consequence, however, is a

matter of enforcing the terms of the agreement to arbitrate, not denying enforcement.

Because the only agreement that McGill holds invalid and unenforceable is one that is outside of section 2’s enforcement mandate, Comcast’s arguments

about the scope of the saving clause have no bearing

on the question whether the FAA preempts the McGill

rule. Comcast’s arguments on this point therefore do

not support a grant of certiorari in this case.

19

B. In any event, Comcast’s incorrect claim that

Blair and McGill conflict with decisions of this Court

regarding the saving clause, and Comcast’s attempt to

conjure up a circuit split on the issue, fall well short of

justifying review.

1. Comcast makes a tepid argument that Blair

and McGill conflict with decisions of this Court, but it

identifies no decisions that adopt the position that the

saving clause applies only to contract-formation defenses and excludes generally applicable state-law defenses regarding contract validity and enforceability.

Comcast’s invocation of Dean Witter Reynolds, Inc. v.

Byrd, 470 U.S. 213, 218 (1985), illustrates that Comcast is grasping at straws. Dean Witter did not involve

a claim that a generally applicable contract doctrine

invalidated a provision of an arbitration agreement,

and thus it did not construe the scope of the saving

clause. It merely cited section 2, including its reference to grounds for “revocation,” in framing the

Court’s holding that in the absence of a claim that

such grounds exist, an agreement to arbitrate must be

enforced.

Likewise, in McMahon, 482 U.S. 220, the Court did

not address an argument that generally applicable

contract-law principles rendered an arbitration agreement invalid in whole or in part. Rather, the Court addressed and rejected the argument that federal statutory claims in general, and RICO and Securities Exchange Act claims in particular, are exempt from arbitration. McMahon noted in passing that an agreement to arbitrate such claims would be unenforceable

in circumstances that “would provide ‘grounds for the

revocation of any contract,’” id. at 226 (quoting 9

U.S.C. § 2), and it offered an example of such grounds.

But McMahon had no reason to and did not attempt

20

to define the limits of the saving clause, let alone exclude any particular grounds for contract invalidation

from its scope.

This Court has repeatedly recognized that “revocation” as used in the saving clause means “invalidat[ing]” an arbitration provision—that is, nullifying

it because it is not “legally binding,” regardless of

“whether it was in fact agreed to”—and that the saving clause encompasses generally applicable contract

defenses that have that effect. Rent-A-Center, 561 U.S.

at 68, 69 n.1; see also, e.g., Epic, 138 S. Ct. at 1622;

Kindred, 137 S. Ct. at 1326; Concepcion, 53 U.S. at

340; Preston, 552 U.S. at 983; Casarotto, 517 U.S. at

687; Allied-Bruce, 513 U.S. at 281. In Kindred, the

Court held explicitly that the saving clause applies

equally to issues of contract formation and other issues of contractual validity and enforceability. 137 S.

Ct. at 1428. And in Buckeye, the Court explained that

the saving clause applies to all challenges to “the validity of the agreement to arbitrate.” 546 U.S. at 444.

And it expressly rejected the proposition, central to

Comcast’s argument here, that the saving clause distinguishes between contract-law doctrines governing

whether a contract is “void ab initio” and those that

determine whether it is “voidable.” Id. at 446.

Thus, for example, this Court has often stated that

unconscionability—a generally applicable contract defense under state law that depends in part on the substantive provisions of a contract, not just the circumstances of its formation—is a ground for invalidating

arbitration agreements covered by the saving clause.

See, e.g., Concepcion, 563 U.S. at 339 (quoting Casarotto, 517 U.S. at 687); accord, e.g., Epic, 138 S. Ct. at

1622; Kindred, 137 S. Ct. at 1426. If unconscionability

were not preserved as a defense, parties with superior

21

bargaining power could impose all manner of onerous

terms in an arbitration provision, and those terms

could never be subject to challenge.

The suggestion that Blair and McGill conflict with

this Court’s precedents construing the saving clause is

thus wholly meritless.

2. Comcast’s assertion of a conflict among the circuits over whether its own narrow reading of the saving clause is proper is equally unconvincing. In surveying decades of circuit precedent interpreting the

FAA, Comcast identifies only four decisions that it

claims support limiting the saving clause to formation

issues, two dating from 1971 and none more recent

than 1990. Even a cursory reading of the opinions

shows that they do not support Comcast’s view.

Comcast’s leading authority, County of Middlesex

v. Gevyn Constr. Corp., 450 F.2d 53 (1st Cir. 1971),

holds that a claim that the party invoking arbitration

breached the contract containing the arbitration

agreement does not assert a generally applicable contract-law ground for “revocation” of the arbitration

agreement within the meaning of section 2’s saving

clause. Middlesex rests principally on this Court’s

holding in Prima Paint that an asserted ground for

unenforceability that is applicable to the contract containing an arbitration provision rather than to the arbitration provision itself is not a basis for avoiding enforcement under section 2. See 450 F.2d at 55. Middlesex further indicates that the saving clause would apply to contract-law grounds for “voiding” an arbitration provision. Id. at 56. The court’s reasoning does not

suggest that a generally applicable contract-law doctrine such as McGill, which renders an agreement invalid, does not satisfy the saving clause.

22

Comcast’s other featured example, Halcon International, Inc. v. Monsanto Australia Ltd., 446 F.2d 156

(7th Cir. 1971), is equally off-point. There, the Seventh

Circuit rejected the argument that an asserted defense of laches was a basis for revocation of an arbitration agreement under the saving clause. Again, the

outcome hinged mainly on Prima Paint: The court

pointed out that “[i]n this case, the question of timeliness or untimeliness involves the whole contract and

its interpretation.” Id. at 162. Because the defense related to “the entire contract” rather than the arbitration clause, Prima Paint made it an issue for consideration by the arbitrators, not a defense to enforcement of the arbitration agreement. Id. The court also

noted that a laches defense, by its nature, did not eliminate a contractual right or render the contract “invalid.” Id. at 159. The court expressed the view that revocation within the meaning of the saving clause

should be “limited to invalidation.” Id. As in Middlesex, that observation, even if it were not dicta given

that the court based its holding on Prima Paint, would

support the view that McGill’s holding—that a waiver

of public-injunctive relief is invalid—is the kind of

contract defense that is cognizable under the saving

clause.

The two somewhat more recent cases Comcast

cites are weaker still. In Supak & Sons Manufacturing Co. v. Pervel Industries, Inc., 593 F.2d 135 (4th Cir.

1979), the Fourth Circuit observed that the FAA does

not displace state-law contract-formation principles.

Id. at 137. Neither that wholly accurate observation

nor anything else in Supak supports Comcast’s argument that the FAA does displace state-law contractvalidity principles. Indeed, Supak expressly acknowledges that section 2’s purpose is to “make arbitration

23

agreements as enforceable as other contracts, but not

more so.” Id. (quoting Prima Paint, 388 U.S. at 404

n.12). Comcast’s argument directly contradicts

Supak’s endorsement of that fundamental equaltreatment principle.

Comcast’s reliance on National Railroad Passenger

Corp. v. Consolidated Rail Corp., 892 F.2d 1066 (D.C.

Cir. 1990), is equally misplaced. There, Amtrak

sought to avoid arbitration based on the argument

that the substantive contractual indemnity obligation

that Conrail sought to enforce in the arbitration was

invalid. The court held that section 2’s saving clause

is limited to “a claimed infirmity that affects the validity of the arbitration clause” and does not allow a

party to resist arbitration based on “a claimed infirmity that relates only to another part of the contract.”

Id. at 1070. That unexceptionable holding does not

suggest that section 2’s saving clause denies effect to

state contract-law defenses that, like McGill, affect

the validity of the arbitration clause.

If there were any doubt about the meaning of the

decisions Comcast cites, more recent decisions from

each of the circuits that issued them demonstrate that

those courts follow this Court’s precedents recognizing

that the saving clause subjects arbitration agreements to generally applicable state-law principles governing the validity and enforceability as well as formation of contracts. See, e.g., Bekele v. Lyft, Inc., 918

F.3d 181, 185 (1st Cir. 2019) (“State contract law supplies the principles for determining validity, revocability, and enforceability [of an agreement to arbitrate].”); Jackson v. Payday Fin., LLC, 764 F.3d 765,

779–80 & n.39 (7th Cir. 2014) (applying general Illinois law concerning validity of contract terms to arbitration agreements under section 2); Booker, 413 F.3d

24

at 79 (recognizing that the FAA does not permit courts

to enforce invalid provisions of arbitration agreements); Murray v. United Food & Commercial Workers Int’l Union, 289 F.3d 297, 302 (4th Cir. 2002) (holding that inquiry under saving clause is “not focused

solely” on “contractual formation defects” and extends

to validity and enforceability).

Thus, in declining to accept Comcast’s restrictive

theory of the saving clause, the court of appeals here

did not decide this case in conflict with precedent of

this Court or other circuits.

C. Comcast’s assertion that the “plain meaning” of

the saving clause’s reference to “such grounds as exist

at law or in equity for the revocation of any contract”

limits the clause’s application to formation defenses is,

in any event, wrong. The FAA’s language readily supports the judicial consensus that the statute creates

an equal-treatment principle allowing assertion of

generally applicable contract doctrines encompassing

the validity and enforceability of contracts. Indeed,

the sole Justice who has been a proponent of Comcast’s theory has acknowledged that “the difference

between revocability, on the one hand, and validity

and enforceability, on the other, is not obvious.” Concepcion, 563 U.S. at 354 (Thomas, J., concurring).

Comcast’s attempt to come up with a convincing

reading of the text that excludes validity and enforceability challenges does nothing to demonstrate any obvious reading of “revocation” that supports its view.

Comcast acknowledges that “revocation” itself is not a

term with a well-defined meaning, Pet. 15, so it picks

another term it likes better and offers it as a synonym:

“rescission.” But this substitution does Comcast no

good, for “rescission” itself is a generic term referring

25

to the circumstances in which a contract has been “terminated, abrogated, annulled, avoided, discharged, or

rescinded.” 26 Williston on Contracts § 68:3 (4th ed.

2019). Both “revocation” and “rescission” encompass

the voiding or “invalidation” of all or part of a contract,

as Comcast’s own lead authority for equating “revocation” with “rescission” acknowledges. Halcon, 446

F.2d at 159.

Neither “revocation” nor “rescission” is a term limited to formation errors. Indeed, “revocation” may be

available based on circumstances long postdating contract formation. For example, both the Uniform Commercial Code and general contract-law principles recognize that a contract may be revoked when one party

engages in a fundamental breach that goes to the essence of the contract. See UCC § 2-608; 14 Williston on

Contracts § 40:23 (4th ed. 2019). In addition, California contract law has long recognized that the substantive terms of an agreement, as well as the circumstances of its formation, may provide a basis for rescission. See Cal. Civ. Code § 1689; see also People ex rel.

Brown v. Barenfeld, 21 Cal. Rptr. 501, 510 (Cal. Ct.

App. 1962) (recognizing availability of rescission in

cases of contracts that are illegal or contrary to public

policy). Rescission, moreover, is available not only

where a contract is void ab initio, but also where it is

voidable, including for unconscionability or unlawfulness of its terms. See 1 Williston on Contracts § 3:3

(4th ed. 2019); 8 Williston on Contracts § 19:80 (4th

ed. 2019). The saving clause’s language thus supports

the construction this Court and the lower courts have

long placed on “revocation” as a term broadly capturing general state contract-law doctrines that justify

invalidating or avoiding contract terms.

26

In addition to asserting that the saving clause is

limited to preserving state laws governing contract

formation, Comcast also argues that the McGill rule

cannot be a contract defense at “law” or in “equity” for

“revocation” of a contract because it was “manufactured” by the California courts based on a statute that

“says nothing about contracts,” Pet. 21, and because it

permits severance of other portions of an arbitration

provision rather than rendering it entirely void, Pet.

20. Comcast’s argument that state decisional law,

from the highest court in the State and based on a

state statute, does not qualify as “law” lacks any support in precedent or logic. Comcast’s assertion that the

statute invalidating waivers of public rights does not

refer to contracts is also false: The statute plainly

states that “a law established for a public reason cannot be contravened by a private agreement”—that is, a

contract. Cal. Civ. Code § 3513 (emphasis added).

Comcast’s claim that the McGill rule does not involve revocation because it allows for the possibility of

severing an invalid waiver of the right to public injunctive relief from an otherwise valid arbitration

agreement is likewise meritless. It is black-letter contract law that a contract may be rescinded or invalidated in part if it provides for severability. See 27 Williston on Contracts § 69:48 (4th ed. 2019); 8 Williston

on Contracts § 18:18 (4th ed. 2019). California contract law accordingly provides for contracts to be “rescinded in whole or in part,” Cal. Civ. Code § 1692,

and, in some circumstances, permits severance of

valid terms from those that are unlawful or unconscionable, id. §§ 1599, 1670.5. Failure to apply these

general principles of contract law would violate the

FAA by treating arbitration agreements differently

from other contracts. See Bodine v. Cook’s Pest Control

27

Inc., 830 F.3d 1320, 1325 (11th Cir. 2016) (stating that

FAA requires application of state law to determine

severability); Booker, 413 F.3d at 83–84 (severing invalid limitation on remedies and enforcing remainder

of arbitration clause). Comcast cannot turn McGill’s

compliance with this key FAA requirement into a

strike against it.

III. The McGill rule does not impair consumer

arbitration in California.

Comcast urges the Court to take up its revisionist

interpretation of the saving clause because, it asserts,

McGill “cast[s] a shadow over consumer arbitration

agreements in California.” Pet. 24. But McGill does no

such thing: In accordance with this Court’s interpretation of the FAA, it allows companies to require consumers to agree to broad arbitration agreements covering disputes arising out of their relationships.

McGill also does not restrict companies from requiring

customers to waive the right to bring or participate in

class or “representative” claims in any forum, contrary

to Comcast’s suggestion. Pet. 23. A claim for public injunctive relief is not brought in a representative capacity. McGill, 393 P.3d at 93. Thus, a provision that

bars “representative claims” but not public injunctive

relief does not trigger the McGill rule. See, e.g., Greenley v. Avis Budget Group Inc., 2020 WL 1493618, at *8

(S.D. Cal. March 27, 2020).3

––––––––––––––––––––––––

3 Separately, California law provides that the right to bring

one type of “representative” action—a qui tam action under the

Private Attorneys General Act (PAGA), in which the plaintiff

seeks statutory penalties for California Labor Code violations on

behalf of the state—may not be waived contractually. See Iskanian v. CLS Transp. L.A., LLC, 327 P.3d 129 (Cal. 2014). The

(Footnote continued)

28

Moreover, McGill provides a variety of options for

addressing individual claims for public injunctive relief by allowing enforcement of arbitration agreements

regardless of whether they provide for arbitration of

the issue of public injunctive relief. The only thing

McGill does not allow a company to do is excuse itself

from liability for such relief altogether.

Under McGill, courts have held that an arbitration

agreement that is silent about the availability of public injunctive relief will be enforced. See Rivera v.

Uniqlo Calif., LLC, 2017 WL 6539016 (C.D. Cal. Sept.

8, 2017); see also Aanderud v. Super. Ct., 221 Cal.

Rptr. 3d 225, 239 (Cal. Ct. App. 2017). McGill likewise

does not bar enforcement of an arbitration agreement

that allows an arbitrator to issue public injunctive relief. See Greenley, 2020 WL 1493618, at *8; GonzalezTorres v. Zumper, Inc., 2019 WL 6465283, at *8 (N.D.

Cal. Dec. 2, 2019).

McGill also allows a company to exclude public injunctive relief from arbitration while requiring arbitration of the rest of a consumer’s claims, as long as

the consumer eventually has the ability to seek public

injunctive relief in court. See, e.g., Eiess v. USAA Fed.

Sav. Bank, 404 F. Supp. 3d 1240, 1260–61 (N.D. Cal.

2019). A company can even, if it chooses, draft its consumer agreement to require that arbitration (including on liability and other forms of relief on the claims

that underlie the request for public injunctive relief)

––––––––––––––––––––––––

Ninth Circuit has held that the FAA does not preempt Iskanian’s

holding, Sakkab v. Luxottica Retail N. Am., Inc., 803 F.3d 425

(9th Cir. 2015), and this Court has repeatedly denied certiorari

on that issue, see, e.g., Five Star Sr. Living Inc. v. Mandviwala,

138 S. Ct. 2680 (2018). The present case, however, does not involve PAGA claims or representative actions.

29

precede any judicial proceedings on public injunctive

relief. See id. (staying litigation of public injunctive

claims pending arbitration pursuant to 9 U.S.C. § 3);

see also McGill, 393 P.3d at 97 (noting appropriateness of such stays); Blair, Pet. App. 26a (“Parties are

welcome to split decision making between a court and

an arbitrator in this manner.”).

Indeed, a defendant can receive the full benefits of

arbitration even if its contract violates McGill (that is,

even if it contains an invalid waiver of public injunctive relief), as long as the agreement does not also preclude severance of that waiver from the agreement to

arbitrate other claims (as Comcast’s does). See, e.g.,

Eiess, 404 F. Supp. 3d at 1260. In other words, a defendant would lose the ability to arbitrate consumer

claims under McGill only if it chose to bet its entire

arbitration provision on the enforceability of its public-injunction waiver, as Comcast did here—rather

than the more typical approach of requiring severance

of invalid or unenforceable provisions.

Comcast is wrong to assert that McGill allows any

consumer plaintiff to “plead her way out of arbitration

by simply tacking onto her complaint a request for

public injunctive relief.” Pet. 23. To begin with, McGill

does nothing to hinder a company from enforcing its

arbitration provision, even if a plaintiff requests public injunctive relief, as long as the provision either: (a)

makes public injunctive relief available in some forum—court or arbitration; or (b) does not expressly

preclude severance of any purported waiver of that

right from the broader arbitration provision. The company has complete control over those possibilities

when drafting its own form contract.

30

Moreover, McGill’s detailed analysis of what qualifies as “public injunctive relief” under California’s

consumer protection statutes, McGill, 393 P.3d at 89–

90, undermines Comcast’s warning that any plaintiff

can invoke the McGill rule just by “tacking on” a purported request for public injunctive relief. “Merely declaring that a claim seeks a public injunction … is not

sufficient to bring that claim within the bounds of the

rule set forth in McGill.” Colopy v. Uber Techs. Inc.,

2019 WL 6841218 (N.D. Cal. Dec. 16, 2019). Only genuine requests for public injunctions, such as respondents’ effort to stop Comcast’s false advertising to the

California public, qualify.

Comcast nonetheless insists that McGill will prove

fatal to arbitration because it will allow plaintiffs to

demand arbitration of public injunctive relief “ex

post,” Pet. 23, and will provide companies “little incentive to arbitrate at all,” id. at 24. Neither assertion is

correct. If an arbitration provision does not provide for

arbitration of public injunctive claims, a plaintiff will

not be able to demand it, as neither McGill nor the

FAA permits that result. See McGill, 393 P.3d at 97.

And it is highly unlikely that companies that otherwise see benefits in arbitration provisions will forgo

using them just because they cannot be used to waive

outright the plaintiff’s entitlement to a particular

form of relief. Comcast provides no evidence that companies have reduced their reliance on arbitration provisions since McGill.

The lack of evidence is unsurprising because, even

before McGill, not all arbitration agreements precluded arbitration of claims for public injunctive relief

or purported to require outright waiver of such claims.

And after McGill, companies have continued to use

broad consumer arbitration provisions while

31

complying with McGill’s prohibition on waiver of public injunctive relief in various ways. Bank of the West,

for example, has altered its arbitration provision to

permit arbitration of claims for public injunctive relief: “If the remedy is available to you under applicable

law, this paragraph does not affect your ability to seek

public injunctive relief, as defined in McGill v. Citibank … pursuant to the process described in this provision.”4

Other companies have taken a different approach,

creating severability provisions designed to allow public injunctive relief to be decided by courts while otherwise requiring arbitration. Williams-Sonoma’s

terms, for example, permit customers to seek public

injunctive relief in court, but require that any such

proceedings happen only if, and after, the customer arbitrates liability and other requested relief.5 H&R

Block, in its terms for tax year 2019, continues to purport to waive claims for public injunctive relief, but

goes on to provide: “If a court decides that applicable

law precludes enforcement of any of this paragraph’s

limitations as to a particular claim or any particular

remedy for a claim (such as a request for public injunctive relief), then that particular claim or particular

remedy (and only that particular claim or particular

––––––––––––––––––––––––

https://www.bankofthewest.com/-/media/pdf/deposits/perso

nal-account-disclosure.pdf, p.57 (last visited Apr. 20, 2020)

(terms effective December 1, 2019).

5 https://www.williams-sonoma.com/customer-service/legalstatement.html#terms (last visited Apr. 20, 2020) (terms effective January 2020).

4

32

remedy) must remain in court and be severed from

any arbitration.”6

In short, Comcast’s prediction that companies will

cut off their nose to spite their face by abandoning arbitration altogether if they cannot use it as a device to

limit consumers’ substantive rights has already

proved false.

IV. The McGill rule is not contrary to the FAA’s

purposes and objectives.

As a fallback, Comcast asserts that the FAA impliedly preempts the McGill rule because the rule is

incompatible with arbitration’s bilateral nature and

its application thus interferes with the achievement of

the FAA’s purposes and objectives. According to Comcast, the court of appeals gave short shrift to this argument in Blair because it “incorrectly assum[ed] that

the FAA protects only non-class arbitration.” Pet. 31.

In fact, both Blair and McGill recognized that, under

Concepcion, even a generally applicable state-law contract doctrine “is nonetheless preempted by the FAA

if it ‘stand[s] as an obstacle to the accomplishment of

the FAA’s objectives.’” Blair, Pet. App. 19a (quoting

Concepcion, 563 U.S. at 341); see McGill, 393 P.3d at

96–07.

As Blair explains, the contention that the McGill

rule is inconsistent with the bilateral nature of arbitration procedures and the advantages Congress

sought to achieve by allowing parties to choose such

procedures is unconvincing. A claim for public injunctive relief requires neither the participation of nonparties nor procedural formalities to protect their

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https://www.hrblock.com/pdf/HRBlock-Software-LicenseAgreement.pdf, § 11.3 (last visited Apr. 20, 2020).

6

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interests, and it requires no alteration of (or limits to)

terms setting arbitral procedures such as discovery,

motions practice, or briefing. Thus, even if parties

choose to arbitrate claims for public injunctive relief

rather than leaving them to judicial resolution, they

need not forgo “arbitration as envisioned by the FAA”

or resort to “a procedure that is inconsistent with the

FAA.” Concepcion, 563 U.S. at 351. The McGill rule in

no way provides ‘that a contract is unenforceable just

because it requires bilateral arbitration.” Epic, 138 S.

Ct. at 1623.

Of course, some companies may choose not to arbitrate public injunctive relief for any number of reasons, just as they may choose not to arbitrate other

claims. For example, a company might consider antitrust cases or other complex commercial cases unsuitable for arbitration in part because they involve consideration of impacts on competition that extend beyond the parties. No one would suggest, however, that

state antitrust laws are inconsistent with bilateral arbitration and preempted by the FAA for that reason.

Cf. Italian Colors, 570 U.S. at 234 (enforcing arbitration of antitrust claims).

The FAA does not preempt state laws that create

substantive claims for relief just because some parties

might view those claims as poor candidates for arbitration, and it does not require states to allow companies to force consumers to waive altogether any substantive claims companies would prefer not to arbitrate. Such substantive state laws do not disfavor contracts that “have the defining features of arbitration

agreements,” nor do they “hing[e] on the primary characteristic of an arbitration agreement.” Kindred, 137

S. Ct. at 1426, 1427. Bilateral procedures may be one

of those defining features, but waiver of substantive

34

entitlements to relief is not. Waivers of substantive

rights are antithetical to the FAA’s purposes. See

Mitsubishi, 473 U.S. at 628, 637 n.19. A state law that

seeks only to preserve substantive rights while giving

full scope to parties’ choices about whether or not to

(or how to) arbitrate those rights does not conflict with

the FAA, and unless and until there is disagreement

among the lower courts over that proposition, there is

no need for this Court’s intervention.

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted,

MICHAEL W. SOBOL

ROGER N. HELLER

DANIEL E. SELTZ

AVERY S. HALFON

LIEFF CABRASER HEIMANN

& BERNSTEIN, LLP

275 Battery Street

29th Floor

San Francisco, CA, 94111

(415) 956-1000

SCOTT L. NELSON

Counsel of Record

ALLISON M. ZIEVE

PUBLIC CITIZEN

LITIGATION GROUP

1600 20th Street NW

Washington, DC 20009

(202) 588-1000

snelson@citizen.org

DANIEL M. HATTIS

PAUL K. LUKACS

HATTIS & LUKACS

408 108th Ave. NE, Suite 500

Bellevue, WA 98004

(425) 233-8650

Attorneys for Respondents

April 2020