Petition for Writ of Certiorari — Lyft, Inc., Petitioner v. California

Supreme Court briefApr 16, 2024

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No. _____

IN THE

Supreme Court of the United States

____________________

LYFT, INC.,

Petitioner,

PEOPLE OF THE STATE OF CALIFORNIA, ET AL.,

____________________

Respondents.

On Petition for a Writ of Certiorari to the

California Court of Appeal

____________________

PETITION FOR WRIT OF CERTIORARI

____________________

ROHIT K. SINGLA

MUNGER, TOLLES & OLSON LLP

560 Mission Street, 27th Floor

San Francisco, CA 94105

ELAINE J. GOLDENBERG

Counsel of Record

SARAH E. WEINER

MUNGER, TOLLES & OLSON LLP

601 Massachusetts Ave. NW

Suite 500E

Washington, DC 20001-5369

(202) 220-1100

Elaine.Goldenberg@mto.com

JEFFREY Y. WU

MUNGER, TOLLES & OLSON LLP

350 S. Grand Ave.

Fiftieth Floor

Los Angeles, CA 90071

Counsel for Petitioner

QUESTION PRESENTED

Whether the Federal Arbitration Act preempts

state law authorizing public officials to pursue claims

for individualized monetary relief in court for the benefit of individuals who agreed to resolve those claims

in arbitration, thereby circumventing those individuals’ arbitration agreements.

PARTIES TO THE PROCEEDINGS

Petitioner Lyft, Inc., was defendant and appellant

below.

Respondents Uber Technologies, Inc., Raiser-CA,

LLC, Uber-USA, LLC, and Portier, LLC were also defendants and appellants below.

Respondents the People of California and California Labor Commissioner Lilia García-Brower were

plaintiffs and respondents below.

iii

RULE 29.6 STATEMENT

Petitioner Lyft, Inc. is a publicly held corporation

with no parent corporation.

Based on Lyft’s

knowledge from publicly available U.S. Securities and

Exchange Commission filings, no publicly held corporation or entity owns ten percent or more of Lyft’s outstanding common stock.

RELATED PROCEEDINGS

The proceedings directly related to this petition

are:

In re Uber Technologies Wage and Hour Cases, No.

S282614 (Cal. Jan. 17, 2024)

In re Uber Technologies Wage and Hour Cases, No.

A166355 (Cal. Ct. App. Sept. 28, 2023)

In re Uber Technologies Wage and Hour Cases, No.

CJC-21-005179 (Cal. Super. Ct. Sept. 1, 2022)

People v. Superior Court, No. S278933 (Cal. May 3,

2023) and No. A167203 (Cal. Ct. App. Feb. 23,

2023)

García-Brower v. Superior Court, No. S278946

(Cal. May 3, 2023) and No. A167201 (Cal. Ct. App.

Feb. 23, 2023)

TABLE OF CONTENTS

Page

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

PARTIES TO THE PROCEEDINGS .......................... ii

RULE 29.6 STATEMENT ..........................................iii

RELATED PROCEEDINGS....................................... iv

TABLE OF CONTENTS.............................................. v

TABLE OF AUTHORITIES ...................................... vii

PETITION FOR WRIT OF CERTIORARI ................. 1

OPINIONS BELOW .................................................... 1

JURISDICTION........................................................... 1

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED ............................... 1

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

STATEMENT OF CASE ............................................. 3

REASONS FOR GRANTING PETITION ................... 9

There Is A Stark Conflict In Authority

Given That State Courts, Including The

Court Below, Mistakenly Regard

Themselves As Bound By Language In

One Of This Court’s Decisions ........................ 10

II.

The Decision Below Is Irreconcilable

With This Court’s Precedents ......................... 20

III.

The Question Presented Is Exceptionally

Important, And This Case Presents An

Ideal Vehicle To Address It ............................ 24

CONCLUSION .......................................................... 33

APPENDICES

Appendix A: Opinion of the Court of Appeal

(Cal. Ct. App. Sept. 28, 2023) .................................... 1a

Appendix B: Opinion of the Superior Court

(Cal. Super. Ct. Sept. 1, 2022) ................................. 30a

Appendix C: Order of the California Supreme

Court (Cal. Jan. 17, 2024) ....................................... 44a

Appendix D: Constitutional and Statutory

Provisions Involved.................................................. 45a

Appendix E: Amended Complaint, GarcíaBrower v. Lyft, Inc. (Cal. Super. Ct. Nov. 18,

2020) ......................................................................... 46a

Appendix F: Amended Complaint, People of

the State of California v. Uber Technologies,

Inc. (Cal. Super. Ct. June 21, 2022) ........................ 87a

vii

TABLE OF AUTHORITIES

Page(s)

FEDERAL CASES

Arthur Andersen v. Carlisle,

556 U.S. 624 (2009) ................................................ 4

AT&T Mobility v. Concepcion,

563 U.S. 333 (2011) .................. 4, 15, 20, 21, 25, 28

Bank of Am. v. City of Miami,

581 U.S. 189 (2017) .............................................. 16

Bennett v. Liberty National Fire Ins.,

968 F.2d 969 (9th Cir. 1992) ............................... 19

Brunner v. Lyft,

2019 WL 6001945 (N.D. Cal. Nov. 14,

2019)........................................................................ 6

California v. IntelliGender,

771 F.3d 1169 (9th Cir. 2014) .............................. 19

Chao v. A-One Med. Servs.,

346 F.3d 908 (9th Cir. 2003) ................................ 19

Charter Commc’ns v. Derfert,

510 F. Supp. 3d 8 (W.D.N.Y. 2021) ...................... 19

Charter Commc’ns v. Jewett,

573 F. Supp. 3d 742 (N.D.N.Y. 2021) .................. 19

Cunningham v. Lyft,

17 F.4th 244 (1st Cir. 2021) ................................. 32

viii

TABLE OF AUTHORITIES

(continued)

Page(s)

DIRECTV v. Imburgia,

575 U.S. 911 (2015) .............................................. 33

DIRECTV v. Imburgia,

577 U.S. 47 (2015) .................................... 18, 24, 29

EEOC v. Waffle House,

534 U.S. 279 (2002) .......................... 2, 7, 11, 14, 15

Epic Sys. v. Lewis,

584 U.S. 497 (2018) ........................ 4, 15, 20, 25, 29

GE Energy Power Conversion France

SAS v. Outokumpu Stainless USA,

140 S. Ct. 1637 (2020) .......................................... 23

Home Depot USA v. Jackson,

139 S. Ct. 51 (2018) .............................................. 16

Iberia Credit Bureau v. Cingular

Wireless,

379 F.3d 159 (5th Cir. 2004) ................................ 19

Keane v. ALPS Fund Servs.,

2020 WL 7321055 (D. Mass. Dec. 11,

2020)...................................................................... 19

Kindred Nursing Centers v. Clark,

581 U.S. 246 (2017) .................................. 22, 24, 29

Lamps Plus v. Varela,

587 U.S. 176 (2019) ................................ 3, 4, 21, 29

TABLE OF AUTHORITIES

(continued)

Page(s)

Marmet Health Care Ctr. v. Brown,

565 U.S. 530 (2012) ................................................ 3

Moses H. Cone Mem’l Hosp. v. Mercury

Constr.,

460 U.S. 1 (1983) .................................................... 4

Nitro-Lift Techs. v. Howard,

568 U.S. 17 (2012) .......................................... 17, 32

Olde Discount v. Tupman,

1 F.3d 202 (3d Cir. 1993) ................................ 17, 18

Osvatics v. Lyft,

535 F. Supp. 3d 1 (D.D.C. 2021) ................... 5-6, 32

Perry v. Thomas,

482 U.S. 483 (1987) .................................. 15, 21, 29

Preston v. Ferrer,

551 U.S. 1190 (2007) ............................................ 33

Preston v. Ferrer,

552 U.S. 346 (2008) .............................. 4, 15, 16, 29

Quackenbush v. Allstate Ins.,

121 F.3d 1372 (9th Cir. 1997) ........................ 18, 19

Rogers v. Lyft, Inc.,

452 F. Supp. 3d 904 (N.D. Cal. 2020),

aff’d, 2022 WL 474166 (9th Cir. Feb.

16, 2022).................................................................. 6

TABLE OF AUTHORITIES

(continued)

Page(s)

SBM Site Servs. v. Alvarez,

2018 WL 735388 (D. Neb. Jan. 19,

2018)...................................................................... 19

Sheetz v. Cnty. of El Dorado,

144 S. Ct. 477 (2023) ............................................ 33

Viking River Cruises v. Moriana,

142 S. Ct. 734 (2021) ............................................ 33

Viking River Cruises v. Moriana,

596 U.S. 639 (2022) ........... 1, 4, 5, 11, 16, 21-25, 29

STATE CASES

Abbott Lab’ys v. Superior Ct. of Orange

Cnty.,

9 Cal. 5th 642 (2020) ............................................ 27

Auto Equity Sales v. Superior Ct. of

Santa Clara Cnty.,

57 Cal. 2d 450 (1962) ............................................ 33

California v. Altus Fin.,

36 Cal. 4th 1284 (2005) ........................................ 22

Crestwood Behav. Health v. Lacy,

70 Cal. App. 5th 560 (2021).................................. 11

Dep’t of Fair Emp. & Hous. v. Cisco Sys.,

82 Cal. App. 5th 93 (2022).................................... 11

TABLE OF AUTHORITIES

(continued)

Page(s)

DMS Servs. v. Superior Ct.,

205 Cal. App. 4th 1346 (2012).............................. 23

Iskanian v. CLS Transp.,

59 Cal. 4th 348 (2014) .......................................... 28

Joulé v. Simmons,

944 N.E.2d 143 (Mass. 2011) ........................ 14, 30

NC Financial Solutions of Utah v.

Commonwealth ex rel. Herring,

854 S.E.2d 642 (Va. 2021) ........................ 12, 13, 30

People v. Coventry First,

915 N.E.2d 616 (N.Y. 2009)............................ 12, 30

People v. Maplebear,

81 Cal. App. 5th 923 (2022).................................. 11

Rebolledo v. Tilly’s,

228 Cal. App. 4th 900 (2014)................................ 23

Rent-A-Ctr. v. Iowa Civ. Rts. Comm’n,

843 N.W.2d 727 (Iowa 2014) ..................... 13, 30-31

Sefkow v. Sefkow,

427 N.W.2d 203 (Minn. 1988) .............................. 14

State ex rel. Hatch v.

Cross Country Bank,

703 N.W.2d 562 (Minn. Ct. App.

2005)................................................................ 14, 31

xii

TABLE OF AUTHORITIES

(continued)

Page(s)

Taylor v. Ernst & Young,

958 N.E.2d 1203 (Ohio 2011) ............................... 13

FEDERAL STATUTES

9 U.S.C. 2 ..................................................................... 3

28 U.S.C. 1257(a) ......................................................... 1

STATE STATUTES

Cal. Bus. & Prof. Code § 17200 ................................. 27

Cal. Bus. & Prof. Code § 17203 ....................... 6, 22, 27

Cal. Bus. & Prof. Code § 17204 ......................... 5, 6, 27

Cal. Civ. Proc. Code § 382 ........................................... 6

Cal. Lab. Code § 98.3(b) ......................................... 6, 23

Cal. Lab. Code § 180 .................................................. 28

Cal. Lab. Code § 182 .................................................. 28

Cal. Lab. Code § 248.5(e) ............................................. 7

Cal. Lab. Code § 1193.6 ............................................... 7

Cal. Lab. Code § 1194 .................................................. 5

Cal. Lab. Code § 1194.2 ............................................... 5

xiii

TABLE OF AUTHORITIES

(continued)

Page(s)

OTHER AUTHORITIES

Jane R. Flanagan, Alt-Enforcers: The

Emergence of State Attorneys General

As Workplace Rights Enforcers,

95 Chi.-Kent L. Rev. 103 (2020)........................... 30

Myriam Gilles & Gary Friedman, After

Class: Aggregate Litigation in the

Wake of AT&T Mobility v.

Concepcion,

79 U. Chi. L. Rev. 623 (2012) ............................... 31

National Consumer Law Center,

Consumer Protection in the States: A

50-State Evaluation of Unfair and

Deceptive Practices Laws (Mar.

2018), available at

https://filearchive.nclc.org/udap/

udap-report.pdf ..................................................... 30

Petition for a Writ of Certiorari, Home

Depot USA v. Jackson,

No. 17-1471 (U.S. Apr. 23, 2018) ......................... 16

William H. Pryor Jr., A Comparison of

Abuses and Reforms of Class Actions

and Multigovernment Lawsuits,

74 Tul. L. Rev. 1885 (2000) .................................. 26

Margaret S. Thomas, Parens Patriae

and the States’ Historic Police Power,

69 SMU L. Rev. 759 (2016) .................................. 30

xiv

TABLE OF AUTHORITIES

(continued)

Page(s)

21 Williston on Contracts § 57:19 (4th

ed. 2023) ................................................................ 23

PETITION FOR WRIT OF CERTIORARI

Petitioner Lyft, Inc. respectfully petitions for a writ

of certiorari to review the judgment of the California

Court of Appeal.

OPINIONS BELOW

The opinion of the California Court of Appeal

(Pet.App.1a) is published at 95 Cal.App.5th 1297. The

California Supreme Court’s order denying review

(Pet.App.44a) is unpublished. The order of the California Superior Court denying Defendants’ motions to

compel arbitration (Pet.App.30a) is unpublished.

JURISDICTION

The Court of Appeal issued its opinion on September 28, 2023 (Pet.App.1a), and the California Supreme

Court denied timely filed petitions for review on January 17, 2024 (Pet.App.44a). See S. Ct. R. 13.1. This

Court has jurisdiction under 28 U.S.C. 1257(a).

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

The relevant provisions are reproduced in the appendix to this Petition. See Pet.App.45a.

INTRODUCTION

The Federal Arbitration Act (FAA) “renders agreements to arbitrate enforceable as a matter of federal

law.” Viking River Cruises v. Moriana, 596 U.S. 639,

650 (2022). But time and again, this Court’s review

has been necessary to safeguard that federal right

against efforts by the States, through increasingly creative devices, to undermine arbitration agreements.

This case concerns the newest such device: authorizing a State’s public officials to pursue claims for monetary relief in court on behalf of individuals who

agreed to resolve those very claims in arbitration.

Here, Lyft and the drivers who use its ridesharing

platform agreed to arbitrate any disputes in streamlined, one-on-one arbitration proceedings. But the

California Attorney General and California Labor

Commissioner have attempted to sidestep those arbitration agreements by filing suit against Lyft on behalf

of a large group of drivers, bringing claims the drivers

could have asserted themselves and seeking individualized monetary relief payable to the drivers. The California Court of Appeal approved of that stratagem in

a deeply flawed FAA preemption analysis, concluding

that any public official at any level of government can

litigate a claim for the specific monetary benefit of any

individual by simply ignoring the individual’s contrary

agreement to arbitrate.

In so holding, the court below incorrectly regarded

itself as bound by one of this Court’s decisions and

deepened a state/federal split on FAA preemption.

Multiple state courts of last resort have—like the court

below—given state public officials carte blanche to

override private parties’ choice of an arbitral forum,

making arbitration agreements subject to stateagency veto for more than one-quarter of the U.S. population. And all of those courts have concluded that

this Court’s decision in EEOC v. Waffle House, 534

U.S. 279 (2002), dictates that outcome. They have

done so even though Waffle House does not address

FAA preemption; rather, it concerns a federal agency

exercising enforcement authority under a federal statute and involves no issue of state law. Only this Court

can disabuse the state courts of their view that Waffle

House dictates their mistaken erasure of arbitration

agreements. And only this Court can resolve the irrec-

oncilable conflict with the federal courts of appeals created by the decision below and the other state-court

decisions.

Review is especially critical here because the rule

adopted by the California Court of Appeal represents

an existential threat to the FAA. It is deeply antithetical to the “‘purposes and objectives’ of the FAA,”

Lamps Plus v. Varela, 587 U.S. 176, 183 (2019), to allow identical claims to the ones that parties agreed to

arbitrate to proceed in a judicial forum, with any monetary relief destined for the pockets of people who

could otherwise recover that money only in arbitration, just because a State has authorized public officials to proceed in that way. That nullifies arbitration

agreements, allowing States to override any prohibitions in those agreements on class or other representative actions, claim joinder, and the like. Moreover, the

logic of the decision below would equally justify deputizing private citizens to litigate claims in court on behalf of (and for the direct pecuniary benefit of) whole

classes of individuals who signed arbitration agreements. That would render the FAA—and this Court’s

many careful decisions enforcing the FAA—a dead letter in any State that wanted to make it so.

STATEMENT OF CASE

1. The Federal Arbitration Act (FAA) “requires

courts to enforce the bargain of the parties to arbitrate.” Marmet Health Care Ctr. v. Brown, 565 U.S.

530, 532-533 (2012). Specifically, Section 2 of the FAA

directs 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.

This Court has often described the FAA “as reflecting * * * a ‘liberal federal policy favoring arbitration.’”

AT&T Mobility v. Concepcion, 563 U.S. 333, 339 (2011)

(quoting Moses H. Cone Mem’l Hosp. v. Mercury Constr., 460 U.S. 1, 24 (1983)); accord Epic Sys. v. Lewis,

584 U.S. 497, 505 (2018). Indeed, as the Court has

recognized, Congress enacted the statute in the first

place to combat “hostility to arbitration agreements.”

Concepcion, 563 U.S. at 339.

This Court has frequently applied federal-preemption principles to combat such hostility—much of

which has emanated from California. Although the

FAA does not “purport[] to alter background principles

of state contract law regarding the scope of agreements” or “who is bound by them,” Arthur Andersen v.

Carlisle, 556 U.S. 624, 630 (2009), “state law is

preempted to the extent it ‘stands as an obstacle to the

accomplishment and execution of the full purposes and

objectives’ of the FAA,” Lamps Plus, 587 U.S. at 183

(quoting Concepcion, 563 U.S. at 352). This Court has

held, for example, that the FAA preempts state laws

that prohibit parties to arbitration agreements from

waiving any right to class-action or claim-joinder procedures, see Concepcion, 563 U.S. at 341-344 (involving California law); Viking River, 596 U.S. at 659-662

(same), or that require exhaustion of state administrative remedies before proceeding to arbitration, see

Preston v. Ferrer, 552 U.S. 346, 354-359 (2008) (same).

Such state laws “defeat the ability of parties to control

which claims are subject to arbitration,” Viking River,

596 U.S. at 660, and “hinder speedy resolution of the

controversy” in an arbitral forum, Preston, 552 U.S. at

358—which are exactly the kinds of arbitration-related benefits that the FAA was enacted to protect.

The Court also has frequently emphasized the

broad sweep of the FAA. Recently, the Court ex-

plained that “nothing in the FAA categorically exempts claims belonging to sovereigns from the scope of

§ 2.” Viking River, 596 U.S. at 652 n.4.

2. a. Lyft operates a ridesharing platform that connects passengers looking for rides with drivers who

want to provide rides. When signing up for the platform, drivers are asked to agree to resolve any future

disputes with Lyft in binding arbitration on an individual, non-representative basis. Drivers may opt out

of that arbitration agreement, but most do not.

In this case, public officials in California brought

California state-court actions (which have been coordinated) on behalf of all drivers in the State who use

the Lyft platform. Various plaintiffs—including the

California Attorney General, certain City Attorneys,

and the California Labor Commissioner (collectively,

the “public officials” or “officials”), Pet.App.1a-4a &

n.2—allege that Lyft has violated California statutes

by misclassifying drivers as independent contractors

rather than employees. 1

Drivers can and do pursue cases against Lyft based

on alleged misclassification and alleged violation of

the same statutes the public officials rely on in this

matter. See Cal. Bus. & Prof. Code § 17204 (authorizing claims by aggrieved individuals); see also, e.g., Cal.

Lab. Code §§ 1194, 1194.2 (same). Many drivers pursue such cases in private arbitration. And when drivers have filed such cases in court, judges have routinely compelled such matters to bilateral arbitration

between the driver and Lyft, because that is what the

parties agreed to and what the FAA and this Court’s

precedents require. See, e.g., Osvatics v. Lyft, 535 F.

The public officials assert the same claims against Uber.

Supp. 3d 1, 9-22 (D.D.C. 2021) (Ketanji Brown Jackson, J.); Rogers v. Lyft, Inc., 452 F. Supp. 3d 904, 918,

921 (N.D. Cal. 2020), aff’d, 2022 WL 474166 (9th Cir.

Feb. 16, 2022); Brunner v. Lyft, 2019 WL 6001945, at

*1 (N.D. Cal. Nov. 14, 2019).

Drivers are thus quite capable of pursuing monetary relief from Lyft on their own behalves in arbitration. Yet the public officials here seek that same monetary relief, payable to specific drivers, in court. In

other words, they assert that monetary harm was allegedly suffered by individual drivers as a result of

Lyft’s alleged actions—and that any money ultimately

collected as a result of the officials’ suit is to be meted

out to those drivers, just as a recovery in a class action

is distributed to members of the class. Pet.App.2a-3a,

47a-48a, 62a-78a, 83a-85a, 118a-122a.

The public officials base their requests for that

form of monetary relief on various California statutory

provisions that authorize suits on behalf of aggrieved

individuals. The Attorney General and City Attorneys

seek relief under a state statute that authorizes “[a]ny

person” to “pursue representative claims or relief on

behalf of others” in order “to restore to any person in

interest any money or property * * * which may have

been acquired by means of * * * unfair competition.”

Cal. Bus. & Prof. Code § 17203 (emphasis added); see

Pet.App.2a. Moreover, legal “limitations” governing

class actions “do not apply to claims” brought under

that statute “by the Attorney General, or any district

attorney, county counsel, city attorney, or city prosecutor in [California].” Cal. Bus. & Prof. Code § 17203;

see id. § 17204; Cal. Civ. Proc. Code § 382. Meanwhile,

the Labor Commissioner seeks relief under a state

statute that authorizes the Commissioner to “prose-

cute action for the collection of wages and other moneys payable to employees.” Cal. Lab. Code § 98.3(b)

(emphasis added); see Cal. Lab. Code § 248.5(e) (suit

“to collect legal or equitable relief on behalf of the aggrieved” (emphasis added)); Cal. Lab. Code § 1193.6

(suit to “recover” amounts “owing to any employee”

(emphasis added)); Pet.App.47a-48a.

The public officials also seek some other forms of

relief, none of which are at issue here. They ask for

relief that would diffusely affect drivers going forward

(i.e., an injunction that would force Lyft to change its

business practices) and that would inure directly to

the State’s benefit (i.e., civil penalties to be paid into

State coffers). Pet.App.2a-3a.

b. In the California trial court, Lyft moved to compel arbitration of the public officials’ claims for individualized monetary relief on behalf of drivers who entered into arbitration agreements with Lyft. Lyft argued that the FAA preempts state law that would allow public officials to circumvent those arbitration

agreements by bringing claims in court for monetary

relief on behalf of and in lieu of those drivers, even

though the drivers are contractually bound to arbitrate those very claims. Pet.App.4a-5a. Lyft did not

seek to compel arbitration of the officials’ claims for

injunctive relief or civil penalties payable to the State.

Pet.App.4a.

The trial court denied Lyft’s motions to compel (as

well as similar motions filed by Uber). Pet.App.43a.

That court relied on this Court’s decision in EEOC v.

Waffle House, 534 U.S. 279 (2002), which concluded

that, in light of the “unambiguous[]” text and “detailed

[federal] enforcement scheme” set forth in Title VII

and the ADA, the FAA does not bar the EEOC from

seeking relief “in a judicial forum” for the benefit of

employees who signed arbitration agreements. Id. at

287, 292, 296. According to the trial court, there is no

relevant distinction between the federal action at issue in Waffle House and the public officials’ claims under state law in this case. Pet.App.32a-39a.

c. The California Court of Appeal affirmed in a

published opinion. Pet.App.29a.

The Court of Appeal held that the FAA does not

preempt state law that authorizes public officials to

pursue in court claims for monetary relief that would

have been required to be resolved in arbitration had

those claims had been brought by the individuals who

are actually aggrieved. Pet.App.20a. Like the trial

court, the Court of Appeal relied heavily on this

Court’s decision in Waffle House. See Pet.App.10a

(“We hold that, under Waffle House, the [public officials] are not bound by [the] arbitration agreements.”).

The Court of Appeal deemed it irrelevant that Waffle

House concerned a federal agency suing under a federal statute and thus did not address preemption of

state law by the FAA. Instead, the Court of Appeal

ruled that Waffle House stands for the broad proposition that any “government body exercising express

statutory authority” may seek “‘victim-specific’ relief”

in court regardless of the existence of an underlying

arbitration agreement. Pet.App.16a.

The Court of Appeal also relied on the fact that the

public officials “are not parties to the arbitration

agreements” that Lyft “entered into with [its] drivers.”

Pet.App.6a. The Court dismissed the suggestion that

the officials could be bound as non-signatories—in the

same way that “assignees” and “similarly situated

third parties seeking to present claims held by [others]” are bound—by adopting the categorical rule that

“a government body exercising express statutory authority to seek judicial relief (including ‘victim-specific’

relief) cannot be barred from doing so” by “arbitration

agreements between private parties.” Pet.App.9a,

16a, 19a. That was so, the Court reasoned, because

whenever public officials are “exercising their statutory authority to enforce the law,” the result is an “independent civil enforcement action[],” Pet.App.10a,

17a—regardless of whether the relief sought by the officials “could be sought by individual drivers on their

own behalf” or whether “judgment in the present action could be preclusive of certain issues in future arbitrations” brought by the aggrieved individuals.

Pet.App.18a, 21a.

The California Supreme Court denied Lyft’s timely

petition for review. Pet.App.44a.

REASONS FOR GRANTING PETITION

The holding of the court below eviscerates the protections of the FAA and disregards this Court’s repeated admonitions that arbitration agreements must

be respected and enforced. If states can deputize public officials to litigate in court claims for monetary relief on behalf of individuals who are bound by arbitration agreements, then the enforceability of those

agreements will turn on States’ whims rather than on

the parties’ contracts. The FAA was enacted to foreclose precisely that result. This Court’s review is urgently needed to halt the trend of States authorizing

public officials to circumvent valid agreements to arbitrate—especially because courts in those States have

split with decisions of federal courts of appeals and

have done so based on the mistaken conclusion that

this Court has already resolved the question presented.

There Is A Stark Conflict In Authority Given

That State Courts, Including The Court

Below, Mistakenly Regard Themselves As

Bound By Language In One Of This Court’s

Decisions

State courts, including the court below and multiple state courts of last resort, have split from federal

courts of appeals on the question whether the FAA

preempts state law that authorizes public officials to

disregard private parties’ arbitration agreements

when bringing claims for monetary relief on behalf of

those parties. And the state courts have taken that

position because they incorrectly believe themselves

bound by this Court’s decision in Waffle House, even

though that decision is distinguishable and, indeed,

does not involve any preemption question at all. Because only action by this Court can correct such a misapprehension, review would be warranted on that

ground alone, even absent any conflict in authority.

Here, however, the existence of a clear conflict provides an even more powerful reason for this Court to

step in.

A. 1. In this case, the Court of Appeal held that

the FAA does not preempt state law permitting public

officials to sue in court in their so-called “law enforcement capacities” for individualized monetary relief on

behalf of people or entities who signed arbitration

agreements. E.g., Pet.App.20a-21a. In rejecting the

argument that such state laws stand as an obstacle to

the accomplishment of the purposes of the FAA, that

court repeatedly relied on this Court’s decision in Waffle House. Pet.App.12a, 16a-17a, 26a.

The issue in Waffle House was whether the FAA

blocked the EEOC from seeking “victim-specific relief

in court” under the ADA on behalf of employees who

had agreed to arbitrate with their employers. 534 U.S.

at 284, 288, 296. The Court concluded that nothing in

the FAA “undermine[d] the detailed [federal] enforcement scheme created by Congress” in federal anti-discrimination statutes. Ibid.

Yet the court below understood Waffle House to

have definitively held that no “public enforcement

agency”—whether federal, state, or local—can ever be

affected by an arbitration agreement between “private

parties,” even when the agency seeks “victim-specific

relief” on behalf of one of those parties.

E.g.,

Pet.App.12a, 16a-17a, 26a. Based on that understanding, the Court of Appeal regarded Waffle House as definitively dictating the outcome here. For instance,

that court stated that an order compelling arbitration

here would “effectively negate Waffle House.”

Pet.App.26a. The court also rejected Lyft’s reliance on

one of this Court’s more recent arbitration cases by

stating that the decision in question “did not cite Waffle House and did not state it was altering or limiting

the holding in that case.” Pet.App.12a (citing Viking

River, 596 U.S. at 652 n.4). 2

2. The court below reached the same conclusion as

courts of last resort in New York, Massachusetts,

Iowa, Virginia, and Ohio and as an intermediate appellate court in Minnesota. All of those courts have

Other California Court of Appeal decisions, from multiple districts, have all reached the same mistaken conclusion as the court

below—each in reliance on Waffle House.

See People v.

Maplebear, 81 Cal. App. 5th 923, 932-940 (2022) (refusing to compel arbitration of City Attorney’s claim for restitution on behalf

of individuals and characterizing Waffle House as “binding authority”); Dep’t of Fair Emp. & Hous. v. Cisco Sys., 82 Cal. App.

5th 93, 98-104 (2022) (similar); Crestwood Behav. Health v. Lacy,

70 Cal. App. 5th 560, 580-590 (2021) (similar).

held that the FAA is no bar to allowing state public

officials to disregard arbitration agreements in order

to obtain individualized monetary relief for individuals who are required to seek such relief only in arbitration. And all of those courts have regarded themselves to be bound by Waffle House, which they have

read to apply to public officials at all levels of government and to displace more generally applicable FAApreemption precedent.

The decision of the New York Court of Appeals in

People v. Coventry First, 915 N.E.2d 616 (N.Y. 2009),

which was one of the first state-court decisions to seize

on Waffle House as dispositive of the question presented here, is emblematic. In that case, the court

held that the New York Attorney General could “seek[]

damages” in court “on behalf of the owners of life insurance policies” harmed by alleged bid-rigging, even

though the policy owners had entered into arbitration

agreements with the defendants that covered the alleged bad acts. Id. at 617-620. The court declared that

Waffle House “stands for two broad propositions”:

first, “that pro-arbitration policy goals do not require

a government agency to give up its statutory enforcement authority in favor of arbitration,” and second,

that a “government agency may seek relief specific to

a victim who agreed to arbitrate claims, because * * *

that relief is best understood as part of the vindication

of a public interest.” 915 N.E.2d at 619. The court

ultimately concluded that “defendants’ arguments” in

favor of FAA preemption “fail in light of [that] United

States Supreme Court precedent.” Ibid.

The much more recent decision of the Supreme

Court of Virginia in NC Financial Solutions of Utah v.

Commonwealth ex rel. Herring, 854 S.E.2d 642 (Va.

2021), is similar. There, the court held that FAA

preemption did not apply and that the Virginia Attorney General could therefore “seek[] ‘victim-specific’ relief, including restitution for individual consumers,

when” pursuing a consumer-protection “enforcement

action in a judicial forum,” regardless of “arbitration

agreements between [the defendant] and the individual consumers.” Id. at 643-647. And there, again, the

court understood Waffle House to dictate that result,

explaining that “[t]he holding in Waffle House * * *

was primarily based on the scope of the FAA and the

limitations of the underlying arbitration agreement

rather than the specific provisions of” the federal laws

that the EEOC was enforcing in that case. Id. at 647.

The decisions of the Massachusetts, Iowa, Ohio,

and Minnesota courts are of a piece. Each of those

courts relied heavily on Waffle House to rule that the

FAA is no obstacle to a state public-official action that

advances claims for monetary relief based on alleged

harm to individuals who are required to arbitrate any

disputes with the defendant who has purportedly

caused the harm. In those courts’ view, “[t]he essential point of Waffle House is that the FAA’s reach does

not extend to a public agency,” so “it should not matter

whether a federal or a state * * * enforcement regime

is at issue.” Rent-A-Ctr. v. Iowa Civ. Rts. Comm’n, 843

N.W.2d 727, 736 (Iowa 2014); see id. at 728-741 (holding that Iowa Civil Rights Commission could prosecute

administrative employment-discrimination action and

“grant[] relief specific to” a “complaining employee”

who had agreed “to arbitrate all employment-related

claims”); Taylor v. Ernst & Young, 958 N.E.2d 1203,

1206, 1210-1213 (Ohio 2011) (holding that underlying

arbitration agreement did not affect ability of Ohio insurance superintendent, acting as liquidator of an insolvent insurance company, to assert claims against

accounting firm for negligence and fraudulent transfer); Joulé v. Simmons, 944 N.E.2d 143, 148, 152

(Mass. 2011) (holding that Massachusetts Commission

Against Discrimination could prosecute administrative action seeking “relief specific to the complaining

individual,” including reinstatement and backpay,

“notwithstanding [any] arbitration provision in the

parties’ [employment] agreement”); State ex rel. Hatch

v. Cross Country Bank, 703 N.W.2d 562, 566-571

(Minn. Ct. App. 2005) (holding that Minnesota Attorney General could seek “restitution under the parens

patriae doctrine * * * for all [credit-card holders] injured by” invasion-of-privacy tort despite arbitration

provision in card-holder agreement). 3

3. a. The decision below and each of those other

state-court decisions rests on a grave misreading of

Waffle House, which is not binding or even especially

relevant in assessing whether the FAA preempts state

law that runs roughshod over arbitration agreements.

Waffle House is not a preemption case because it

addresses only how to reconcile federal statutes—the

FAA and the ADA. 4 Based on the determination that

the “statutory text” of the ADA “unambiguously authorize[d] the EEOC to obtain” compensatory and punitive damages on behalf of individual employees “in a

judicial forum,” the Court in Waffle House declined to

The decision of the intermediate appellate court in Minnesota is

binding on all lower courts in that State absent review by the

Minnesota Supreme Court. See Sefkow v. Sefkow, 427 N.W.2d

203, 213 (Minn. 1988).

The ADA authorizes the EEOC “to exercise the same enforcement powers, remedies, and procedures that are set forth in Title

VII” when “enforcing the ADA’s prohibitions against employment

discrimination on the basis of disability.” Waffle House, 534 U.S.

at 285.

read the FAA—a statute enacted many decades before

the ADA—as overriding the “detailed enforcement

scheme created by Congress.” 534 U.S. at 287-292,

295-296.

The Court in Waffle House had no occasion to consider whether the FAA would have preempted a state

statute, and its analysis cannot be extrapolated from

one context to the other. See Perry v. Thomas, 482

U.S. 483, 491 (1987) (cautioning that discussion of arbitration in context of “federally created rights” was inapplicable to “issue of federal pre-emption of state-created rights”). That is because when two federal laws

are at play, “[i]t is this Court’s duty to interpret Congress’s statutes as a harmonious whole rather than at

war with one another.” Epic, 584 U.S. at 502; see Waffle House, 534 U.S. at 297 (noting that the Court was

not “authorize[d] * * * to balance the competing policies of the ADA and the FAA”). By contrast, when a

state statute is at issue in a preemption case, the Supremacy Clause dictates that this Court cannot “preserve state-law rules that stand as an obstacle to the

accomplishment of the [federal statute’s] objectives.”

Concepcion, 563 U.S. at 343. 5

Moreover, cases decided after Waffle House that do

concern state law emphatically teach that state public

officials are not beyond the reach of the FAA. In Preston v. Ferrer, 552 U.S. 346 (2008), for example, this

Court held that the FAA preempted a state statute requiring parties to exhaust administrative remedies before the state Labor Commissioner—even though it

For that reason, a decision by this Court on the merits of this

case will not directly affect the ability of federal agencies or officials to seek in court restitution, disgorgement, or similar individualized monetary remedies that are authorized by federal

statute.

was argued that “[a]llowing parties to proceed directly

to arbitration * * * would undermine the Labor Commissioner’s ability to stay informed of potentially illegal activity”—because “[r]equiring initial reference of

the parties’ dispute to the Labor Commissioner would

* * * hinder speedy resolution of the controversy.” 552

U.S. at 358. And more recently, in Viking River, this

Court clarified in no uncertain terms that “nothing in

the FAA categorically exempts claims belonging to

sovereigns from the scope of” the FAA. 596 U.S. at 652

n.4. Special treatment of “law enforcement officials,”

Pet.App.19a-20a, by state courts cannot be squared

with those precedents.

b. Because the state courts’ holdings stem from a

unanimous and emphatic misunderstanding of Waffle

House, only action by this Court can set those courts

on the right course. Given the last fifteen years of

state-court decisions, there is little reason to hope that

the States in question will change their approach, and

every reason to expect that more state courts of last

resort and other state appellate courts will—like the

court below—join in disregarding the commands of the

FAA so as to place more power in the hands of the relevant State’s own agencies and officials.

This Court often grants review to address lower

courts’ erroneous extensions or interpretations of its

own precedents, even in the absence of a split in authority. See, e.g., Pet.9, Home Depot USA v. Jackson,

No. 17-1471 (Apr. 23, 2018) (arguing that certiorari

was warranted “absent a circuit conflict” because the

courts of appeals had erroneously relied on “broad language in [one of] this Court’s decision[s]” to misinterpret a statute), cert. granted, 139 S. Ct. 51; Bank of

Am. v. City of Miami, 581 U.S. 189, 210 (2017)

(Thomas, J., concurring in part) (noting that the Court

“granted review, despite the absence of a circuit conflict, to decide whether” certain language from this

Court’s earlier opinions had “survived” later decisions). That is particularly appropriate in arbitration

cases given that “[i]t is a matter of great importance”

that state courts, which are “most frequently called

upon to apply” the FAA, “adhere to a correct interpretation” of that federal statute. Nitro-Lift Techs. v.

Howard, 568 U.S. 17, 17-18 (2012). And it is alone

enough to warrant review here.

B. The state courts’ dogged misapplication of Waffle House is hardly the only reason that this Court’s

review is warranted, however. The decision below and

the other state-court decisions reaching the same result conflict with decisions of the federal courts of appeals, including post-Waffle House decisions.

The rule in the Third Circuit is the opposite of the

rule the state courts have adopted. In Olde Discount

v. Tupman, 1 F.3d 202 (3d Cir. 1993), the Third Circuit

held that state securities-enforcement officials could

not seek rescission of a purchaser-broker stock transaction on behalf of stock purchasers who had agreed to

arbitrate claims arising out their relationship with

their broker. See id. at 203-204. Both judges in the

Olde Discount majority examined the FAA and agreed

that state officials cannot nullify “the contractual

rights of * * * parties” by “adjudicat[ing] administratively the very same questions * * * that th[ose parties] themselves could pursue only within an arbitration.” Id. at 209 (opinion of Greenberg, J.); id. at 215

(Rosenn, J., concurring).

One of those judges, Judge Greenberg, concluded

that the State’s “pursuit of the rescission remedy [was]

preempted by the FAA.” 1 F.3d at 209-210 (opinion of

Greenberg, J.). He reasoned that because the State’s

“claims * * * would be subject to arbitration if pursued

by the [stock purchasers] themselves,” allowing the

state officials to pursue a recission remedy “would render [the defendant’s] right to arbitration meaningless.” Id. at 208-209. And he was unpersuaded by the

very same arguments that the Court of Appeal found

dispositive below—i.e., that “the state’s enforcement

action implicate[d] the public interest” and that state

officials were “not parties to the arbitration clause.”

Id. at 209-210.

Judge Rosenn, meanwhile, arrived at the same disposition “by way of contract law rather than the doctrine of preemption,” because in his view the state officials’ “pursui[t] of “the remedy of rescission” was

nothing more than an “‘end run’ around the terms of

the arbitration agreement.”

1 F.3d at 215-216

(Rosenn, J., concurring). But he acknowledged that

the FAA “protect[ed]” the contractual arbitration right

in question and that the contract-law principles on

which he relied were bolstered by the “strong federal

policy in favor of arbitral dispute resolution” that the

FAA embodies. Id. at 215-216.

The decision below and the other state-court decisions also stand in tension with decisions of the Ninth

Circuit—which means that state courts and federal

courts have reached different results that affect the

very same geographical area. See DIRECTV v. Imburgia, 577 U.S. 47, 53 (2015). Most notably, in

Quackenbush v. Allstate Ins., 121 F.3d 1372 (9th Cir.

1997), the Ninth Circuit invoked the force of the FAA

in requiring the California Insurance Commissioner,

proceeding in his role as liquidator of an insurance

company, to arbitrate his claims against a reinsurer

based on an arbitration agreement between the insurance company and the reinsurer. Id. at 1379-1382.

The court explained that the FAA required enforcement of the “valid arbitration agreement * * * covering the disputed claims” and rejected the Commissioner’s argument that “the liquidation court, by virtue of” its “public responsibilities,” is in a “better position to adjudicate the state-law issues” than a “lay arbitrator.” Id. at 1382; see, e.g., Bennett v. Liberty National Fire Ins., 968 F.2d 969, 972 (9th Cir. 1992)

(Montana Insurance Commissioner “bound by” arbitration agreement between insurer and another party

where Commissioner “st[ood] in the shoes of [an] insolvent insurer” to “enforce [its] contractual rights”); see

also Chao v. A-One Med. Servs., 346 F.3d 908, 923 (9th

Cir. 2003) (Secretary of Labor was in privity with employee, for purposes of res judicata, where she was “suing for employee-specific rights” to “recoup [the employee’s] individual economic loss”); California v. IntelliGender, 771 F.3d 1169, 1179-1182 (9th Cir. 2014)

(similar). 6

To be sure, not every federal court is in complete accord with the

decisions of the Third and Ninth Circuits. See Iberia Credit Bureau v. Cingular Wireless, 379 F.3d 159, 175 (5th Cir. 2004) (reasoning that arbitration provision prohibiting class arbitration

was not unconscionable because (among other reasons) the state

attorney general could still “pursue restitutionary relief on behalf

of a class of aggrieved consumers”); see also Keane v. ALPS Fund

Servs., 2020 WL 7321055, at *5 (D. Mass. Dec. 11, 2020) (ruling

that “an arbitration agreement cannot preclude [a state] administrative agency enforcement action”); Charter Commc’ns v. Derfert, 510 F. Supp. 3d 8, 14-21 (W.D.N.Y. 2021); Charter Commc’ns

v. Jewett, 573 F. Supp. 3d 742, 757 (N.D.N.Y. 2021); SBM Site

Servs. v. Alvarez, 2018 WL 735388, at *1-5 (D. Neb. Jan. 19,

2018), report and recommendation adopted, 2018 WL 734170 (D.

Neb. Feb. 6, 2018). As a general matter, however, federal courts

are less likely than state courts to be solicitous of state public

officials and more likely to conclude that the FAA preempts state

law in this area.

II.

The Decision Below Is Irreconcilable With

This Court’s Precedents

Even apart from all of those highly problematic aspects of the lower court’s decision, this Court’s review

is warranted because the decision conflicts with this

Court’s precedents.

The “hostility to arbitration agreements” that

prompted enactment of the FAA manifested itself in

“‘a great variety’ of ‘devices and formulas’ declaring arbitration against public policy.” Concepcion, 563 U.S.

at 339, 342. Mindful of that history, this Court has

emphasized the importance of remaining “alert to new

devices and formulas that would achieve much the

same result.” Epic, 584 U.S. at 509 (quoting Concepcion, 563 U.S. at 342).

The rule adopted by the Court of Appeal here is just

such a device. The court’s decision rests on two facts

that are common to nearly all state-law enforcement

schemes authorizing public officials to pursue monetary relief on individuals’ behalf. First, the court observed that the Attorney General, City Attorneys, and

Labor Commissioner “are not parties to the arbitration

agreements at issue,” Pet.App.8a, because—unsurprisingly—they had not actually signed the agreements between Lyft and the drivers who use its platform. Second, the court determined that the government officials were not “prox[ies] for the drivers” because “[t]he public officials who brought these actions”

were “authorized by statute to bring the claims at issue here and to seek the relief they request.”

Pet.App.8a, 21a. In other words, the Court of Appeal

held that public officials may wipe away private parties’ arbitration agreements, while passing along any

monetary recovery to those parties, so long as the state

legislature has authorized the officials to do so.

That holding flouts this Court’s FAA preemption

precedents. It is difficult to imagine a rule that more

completely “‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives’

of the FAA,” Lamps Plus, 587 U.S. at 183 (quoting

Concepcion, 563 U.S. at 352), than one that authorizes

state public officials to end run private arbitration

agreements by asserting in court claims for monetary

relief on behalf of individuals who are contractually

obligated to arbitrate all claims against the very parties that the public officials have sued. Such a rule

impermissibly “defeat[s] the ability of parties to control which claims are subject to arbitration,” Viking

River, 596 U.S. at 660, because it vests public officials—rather than the contracting parties—with the

ultimate decision-making authority over where an individual’s right to monetary relief will be adjudicated,

see Perry, 482 U.S. at 489 (FAA “withdrew the power

of the states to require a judicial forum for the resolution of claims which the contracting parties agreed to

resolve by arbitration”).

That rule also deprives the contracting parties of

the benefits of arbitration’s “efficient, streamlined procedures.” Concepcion, 563 U.S. at 344. It potentially

leaves arbitrators nothing to do but apply previously

issued judicial rulings, see Pet.App.18a (refusing to

discount the possibility that “the present action will

have preclusive effect in drivers’ individual arbitrations”)—or, at the very least, subjects defendants to

duplicative proceedings in court and in arbitration.

And it permits public officials to bring representative

actions on behalf of a large group of individuals, including what amounts to a state-wide “class” of individuals, even where those individuals’ arbitration

agreements expressly forbid class or other mass actions and require one-on-one claim resolution by an arbitrator.

The Court of Appeal tried to evade preemption by

characterizing the state Attorney General and Labor

Commissioner as bringing “their own statutory

claims” rather than “derivative claims.” Pet.App.18a19a, 21a (emphasis added). But this Court is “not required to take the labels affixed by state courts at face

value in determining whether state law creates a

scheme at odds with federal law.” Viking River, 596

U.S. at 654 n.6. On the contrary, just as States may

not openly “discriminat[e] on [their] face against arbitration,” States may not adopt “a[] rule that covertly

accomplishes the same objective.” Kindred Nursing

Centers v. Clark, 581 U.S. 246, 251 (2017); see, e.g.,

Viking River, 596 U.S. at 650 (“[E]ven rules that are

generally applicable as a formal matter are not immune to preemption by the FAA.”).

Here, the public officials who brought the claims at

issue unquestionably stand in the shoes of the drivers

for whom they seek to recover direct monetary compensation—with that money to be turned over to the

drivers at the conclusion of the suit. The California

Attorney General is proceeding under a state statute

authorizing him to pursue “relief on behalf of others,”

Cal. Bus. & Prof. Code § 17203, and the California Supreme Court has elsewhere recognized that the Attorney General’s “primary purpose” in bringing a claim

under that statute “is to recover lost property on behalf

of” individuals allegedly injured by an unlawful practice—a role that is “quintessentially” akin to a “conservator” or “trustee.” California v. Altus Fin., 36 Cal.

4th 1284, 1305 (2005). The California Labor Commis-

sioner is proceeding under a state statute that authorizes her to seek “moneys payable to employees,” Cal.

Lab. Code § 98.3(b)—and when she takes such “action

to collect wages or benefits on behalf of a worker,” she

acts only “as a trustee of the monies collected.” Rebolledo v. Tilly’s, 228 Cal. App. 4th 900, 914 (2014).

Moreover, the Court of Appeal recognized that the

driver-specific relief requested by all of the public officials in this case could also “be sought by individual

drivers on their own behalf.” Pet.App.21a.

Thus, the simple fact is that the public officials’

claims are identical to, and coextensive with, the individual drivers’ claims. In any other situation with any

other plaintiffs, blackletter law would preclude the

drivers from avoiding their arbitration agreements by

transferring their claims to a third party to litigate in

court. See, e.g., GE Energy Power Conversion France

SAS v. Outokumpu Stainless USA, 140 S. Ct. 1637,

1643-1644 (2020); DMS Servs. v. Superior Ct., 205 Cal.

App. 4th 1346, 1353 (2012); 21 Williston on Contracts

§ 57:19 (4th ed. 2023).

Accordingly, the failure of the court below to deem

the public officials’ claims preempted by the FAA, despite the many decisions of this Court dictating that

result, cries out for review. This Court has not hesitated in the past to grant certiorari to correct a State’s

failure to enforce the FAA, through preemption or otherwise. Notably, that has been true even where no

split in authority existed and the question presented

was specific to one State—often, California. See, e.g.,

Viking River, 596 U.S. at 643 (certiorari to California

Court of Appeal to decide whether FAA “preempt[ed]

a rule of California law that invalidate[d] contractual

waivers of the right to assert representative claims under California’s Labor Code Private Attorneys General

Act of 2004”); DIRECTV, 577 U.S. at 50-53 (certiorari

to California Court of Appeal to decide whether FAA

preempted interpretation of the phrase “law of your

state” to include California law invalided by this

Court’s decision in Concepcion); Kindred Nursing, 581

U.S. at 248 (certiorari to consider Kentucky rule that

“a general grant of power [of attorney] * * * does not

permit a legal representative to enter into an arbitration agreement”). Review is equally or more warranted in this case.

III. The Question Presented Is Exceptionally

Important, And This Case Presents An Ideal

Vehicle To Address It

A. Whether the FAA preempts state law that permits public officials to bring claims for monetary relief

on behalf of individuals who have signed binding

agreements to arbitrate those claims, with that relief

to be turned over to those individuals at the end of the

officials’ suit, is a pressing question that is urgently in

need of resolution by this Court. The question is arising in the lower courts with increasing frequency. And

the decision below—like the other state-court decisions that have reached a similar result—allows a

State to effectively erase a binding arbitration agreement, and thereby ignore any limitation in that agreement on mass actions, through a simple stratagem.

Absent FAA preemption, that stratagem would render

a large swath of this Court’s arbitration decisions a

dead letter and would severely disrupt a wide range of

established business arrangements that depend on resolving disputes through non-representative arbitration.

1. Over the last decade and a half, this Court has

taken great pains to ensure that parties enjoy the

“right to arbitrate” in a “meaningful sense.” Viking

River, 596 U.S. at 651. In Concepcion, this Court held

that States cannot “[r]equir[e] the availability of classwide arbitration” because such a mandate “interferes

with fundamental attributes of arbitration.” 563 U.S.

at 344. This Court reaffirmed that principle in Epic,

where it again held that the FAA protects access to the

benefits of arbitration, i.e., “its speed and simplicity

and inexpensiveness.” Epic, 584 U.S. at 509. And once

more in Viking River, this Court found preempted “[a]

state rule imposing an expansive rule of joinder in the

arbitral context” because it “defeat[ed] the ability of

parties to control which claims are subject to arbitration.” 596 U.S. at 660. In other words, this Court has

consistently held that the FAA is incompatible with

rules that have the effect of coercively funneling otherwise arbitrable claims into litigation or that

threaten the parties’ ability to agree on simple bilateral arbitration. See id. at 656, 661.

The holding below creates just such a rule, and it

permits enforcement of state law that is entirely incompatible with the FAA. Under the reasoning

adopted by the Court of Appeal and the decisions of

courts in other States, a state legislature can effectively nullify arbitration agreements—including

agreements that contain a bar on class actions or other

forms of group actions. All the legislature must do is

authorize public officials to pursue in court claims for

monetary relief on behalf of individuals bound by such

agreements, give those individuals the right to any

monetary recovery that results from the officials’ suits,

and then declare by legislative fiat that the officials’

claims are somehow “independent” of the individuals’

claims. Pet.App.17a, 21a.

Under such a regime, the claims of individuals who

are bound to arbitrate will instead be litigated en

masse in a judicial forum by public officials. And that

will be true even where, as here, the arbitration agreements in question expressly forbid proceeding as part

of a class or other large group of claimants. See, e.g.,

William H. Pryor Jr., A Comparison of Abuses and Reforms of Class Actions and Multigovernment Lawsuits,

74 Tul. L. Rev. 1885, 1886 (2000).

Such public-official litigation would almost certainly preclude the individuals from later pursuing

those same claims in arbitration. See Pet.App.18a (reserving preclusion question). In any event, defendants

would be forced to defend against the relevant claims

in court, which is exactly what arbitration agreements

enforceable under the FAA are supposed to prevent.

Perhaps worse still, the reasoning of those decisions would readily encompass an additional extension of that arbitration-nullification stratagem—one

that would not require any involvement at all by public officials. Under those decisions’ logic, a State could

deputize private persons who have not signed arbitration agreements (and who perhaps have no connection

whatsoever to the relevant parties and facts) to bring

claims on behalf of those who have signed arbitration

agreements, so long as the non-signatories are deemed

to be private attorneys general bringing “sui[t] in their

law enforcement capacities” and are “authorized” under a state statute “to seek the relief they request.”

Pet.App.20a-21a.

Such suits by “private attorney generals” would

share all of the negative features of public-official suits

while removing constraints on circumvention of arbitration agreements like limited resources or prosecutorial discretion. The suits brought by private plaintiffs could be conducted on behalf of a large group or a

class of individuals who would otherwise be bound to

arbitrate in standard bilateral arbitrations that do not

involve anyone but the target of the relevant claim.

And those suits could end with the private plaintiffs

simply turning over the bulk of the monetary recovery

to those very individuals, as the public officials in this

case are bound to do by statute. See pp.6-7, 22-23, supra. That would make every single arbitration agreement vulnerable to displacement by roving, self-appointed attorneys general and their contingency-feebased lawyers.

2. a. The problem is especially acute in California.

First, absent FAA preemption, expansively framed

California state statutes create almost infinite opportunities for public officials to litigate in court precisely

the claims for monetary relief to individuals that those

same individuals would be bound to resolve in arbitration. The laws at issue in this case, for example, cover

a wide range of subject matter. One of those laws authorizes public officials to pursue restitution on behalf

of anyone harmed by “any unlawful, unfair or fraudulent business act or practice.” Cal. Bus. & Prof. Code

§ 17200 (emphasis added); see id. §§ 17203-04. That

intentionally “broad, sweeping language” was designed to “‘borrow[]’ violations of other laws,” thereby

treating any allegedly unlawful conduct by a business

“as [an] unlawful practice[]” that is “independently actionable.” Abbott Lab’ys v. Superior Ct. of Orange

Cnty., 9 Cal. 5th 642, 651-652 (2020). As a result, a

whole host of public officials, ranging from the Attorney General to district and even city attorneys, see

Cal. Bus. & Prof. Code § 17204, can pursue nearly any

claim for relief on behalf of any individual against any

business operating in California.

Moreover, the California legislature has recently

gone so far to codify the holding below—in direct response to this very case—in a statute that expressly

sets arbitration agreements to the side. That statute

authorizes “the Attorney General, a district attorney,

a city attorney, a county counsel, or any other city or

county prosecutor” to seek individualized monetary relief under the California Labor Code and provides that

“private arbitration [agreements] shall have no effect

on the[ir] authority” to do so. Cal. Lab. Code §§ 180,

182 (emphasis added).

Second, California would not have to do much to

extend its laws to encompass suits of the same nature

brought by private parties rather than public officials.

California already has a statute authorizing a private

person to assert Labor Code violations “on behalf of the

state” against that person’s employer in litigation

brought on behalf of a large group of other employees.

Iskanian v. CLS Transp., 59 Cal. 4th 348, 360 (2014),

abrogated in part by Viking River, 596 U.S. 639. A few

changes to that statute’s standing requirement and

scope of available relief—both perfectly plausible under state law, see id. at 387 (“In crafting [that statute],

the Legislature could have chosen to deputize citizens

who were not employees of the defendant employer”)—

and it will not require any action by a public official to

force litigation of claims that the FAA requires to be

arbitrated.

This case is therefore very much in keeping with

California’s long history of attempts to undermine arbitration agreements. For example, before reversals

by this Court, California classified “most collective-arbitration waivers in consumer contracts as unconscionable,” Concepcion, 563 U.S. at 340; rendered a

post-Concepcion class-arbitration waiver unenforceable by interpreting the phrase “law of your state” to

include “invalid California law,” DIRECTV, 577 U.S.

at 55; sought to impose mandatory class procedures in

arbitration, see Lamps Plus, 587 U.S. at 189; conditioned “the enforceability of an arbitration agreement

on the availability” of an expansive claim-joinder rule,

Viking River, 596 U.S. at 660; and refused to compel

arbitration where the dispute concerned wage collection, see Perry, 482 U.S. at 484, or where a state administrative agency had original jurisdiction over a

dispute, see Preston, 552 U.S. at 351-352.

The rule adopted by the court below is just a different way for California to accomplish those very same

aims, in one fell swoop, by side-stepping binding arbitration agreements rather than attempting to impose

direct limitations on them. See Epic, 584 U.S. at 509

(emphasizing importance of remaining “alert to new

devices and formulas that would achieve much the

same result”). And if that were permissible, then this

Court’s considerable body of arbitration decisions

would be side-stepped at the very same time.

b. Those problems certainly are not limited to California. Under the reasoning of the decision below, it

would be “trivially easy” for any State “to undermine

the [FAA]—indeed, to wholly defeat it.” Kindred

Nursing, 581 U.S. at 255.

That is already happening in many States. As discussed above, courts of last resort in numerous States

have issued decisions very similar to the decision below, thereby permitting public officials in those States

to stand in the shoes of individuals who are required

to arbitrate while erasing the arbitration agreements

that bind those individuals. See pp.11-14, supra.

The problem is also likely to spread. Every State

has laws, in some form or another, that permit public

officials to seek monetary relief that is to be turned

over to individuals on whose behalf those officials

bring claims. See, e.g., National Consumer Law Center, Consumer Protection in the States: A 50-State

Evaluation of Unfair and Deceptive Practices Laws 28

(Mar. 2018), available at https://filearchive.nclc.org/

udap/udap-report.pdf; Jane R. Flanagan, Alt-Enforcers: The Emergence of State Attorneys General As

Workplace Rights Enforcers, 95 Chi.-Kent L. Rev. 103,

104-107, 111-115 (2020); Margaret S. Thomas, Parens

Patriae and the States’ Historic Police Power, 69 SMU

L. Rev. 759, 761-764, 796-800 (2016). And the decision

below provides every State in the country that has not

already gone down the same path as California with a

clear roadmap for rendering any arbitration agreement entirely defunct.

3. Allowing States to strike such a fatal blow to the

FAA has extremely troubling practical implications. If

that kind of legal regime were permissible, businesses

could no longer count on the efficiencies of arbitration

to resolve potential disputes with customers, employees, or contractors, as public officials (or private attorneys general) would hold ultimate veto power over the

parties’ choice of an arbitral forum.

No arbitration agreement, on any subject matter or

in any industry, would be safe. That is evidenced by

the range of claims that States have already placed beyond the reach of the FAA’s protections in these kinds

of cases—running the gamut from consumer suits, see

Coventry First, 915 N.E.2d at 617-618 (bid-rigging);

NC Fin., 854 S.E.2d at 643-644 (unfair lending practices), to employment disputes, Joulé, 944 N.E.2d at

145-9147 (pregnancy discrimination); Rent-A-Ctr., 843

N.W.2d at 728-729 (same); to run-of-the-mill tort actions, see Hatch, 703 N.W.2d at 565-567 (invasion of

privacy).

Moreover, limitations in arbitration agreements on

seeking class-type relief would simply be swept aside.

Disputes would be resolved in public-official (or private-attorney-general) litigation that reproduces all of

the worst features of class actions, because it aggregates many individuals’ claims and poses a threat of

devastatingly large monetary liability. At the same

time, that litigation would be free of the formal restrictions—such as those pertaining to class certification and rights of absent class members—that cabin

private class actions. See, e.g., Myriam Gilles & Gary

Friedman, After Class: Aggregate Litigation in the

Wake of AT&T Mobility v. Concepcion, 79 U. Chi. L.

Rev. 623, 660-661 (2012).

In short, businesses that rely on arbitration agreements would be severely harmed by being forced to engage in costly, burdensome litigation over monetary

relief in lieu of arbitration. And there is simply no

need for States to intervene on individuals’ behalf for

their direct monetary benefit, because arbitration provides an effective and efficient mechanism for those individuals to resolve their disputes and because public

officials can (as in this case) pursue other kinds of remedies. This Court should not allow that kind of wholesale displacement of federal law requiring enforcement of arbitration agreements.

B. This case offers an ideal vehicle for this Court

to address the question presented.

This case involves an entirely clean legal issue.

The decision below extensively discusses the question

presented, which was squarely teed up and preserved

at every stage of the case, including in Lyft’s unsuccessful petition for review in the California Supreme

Court. There are no factual disputes to resolve with

respect to Lyft’s arbitration agreements with the drivers, which the Court of Appeal “assume[d] * * * [were]

bind[ing on] drivers who entered them.” 7 Pet.App.6a

n.9. And the legal question for this Court to resolve is

focused and dispositive of the arbitration issue in this

case. Lyft sought to compel arbitration of only the public officials’ claims for driver-specific monetary relief

and raised no challenge to the officials’ ability to seek

remedies in court that diffusely benefit individuals

bound by arbitration agreements and are more classically “public” in character, such as injunctions, regulatory sanctions, or civil penalties.

The state-court decision here is also preferable to a

federal-court decision as a means of resolving the

question presented. Ancillary procedural issues, such

as abstention or lack of complete diversity, might

muddy the waters in a federal case involving FAA

preemption of public-official suits like the one here.

But no such issues exist in this case.

Indeed, this Court has recognized that, because

“State courts rather than federal courts are most frequently called upon” to apply the FAA, “[i]t is a matter

of great importance” that state courts “adhere to a correct interpretation” of that particular “legislation.”

Nitro-Lift, 568 U.S. at 17-18. And while the decision

below was issued by one of California’s intermediate

Indeed, Lyft’s arbitration agreements have been routinely

enforced by state and federal courts. See, e.g., Cunningham v.

Lyft, 17 F.4th 244, 249-253, 255 (1st Cir. 2021); Osvatics, 535 F.

Supp. 3d at 9-22.

appellate courts, this Court has frequently granted review of decisions by those very courts, including in

multiple arbitration cases. See, e.g., Viking River, 142

S. Ct. 734 (2021) (mem.); DIRECTV, 575 U.S. 911

(2015) (mem.); Preston, 551 U.S. 1190 (2007) (mem.);

see also, e.g., Sheetz v. Cnty. of El Dorado, 144 S. Ct.

477 (2023) (mem.). Notably, unlike in many other

States, a decision by any district or division of the California Court of Appeal is binding on all trial courts in

the State. See Auto Equity Sales v. Superior Ct. of

Santa Clara Cnty., 57 Cal. 2d 450, 455 (1962); see p.11

n.2, supra (discussing other California Court of Appeal

decisions from across the State holding the same thing

as the decision below).

CONCLUSION

The petition for a writ of certiorari should be

granted.

Respectfully submitted,

ROHIT K. SINGLA

MUNGER, TOLLES & OLSON LLP

560 Mission Street, 27th Floor

San Francisco, CA 94105

JEFFREY Y. WU

MUNGER, TOLLES & OLSON LLP

350 S. Grand Ave.

Fiftieth Floor

Los Angeles, CA 90071

April 16, 2024

ELAINE J. GOLDENBERG

Counsel of Record

SARAH E. WEINER

MUNGER, TOLLES & OLSON LLP

601 Massachusetts Ave. NW

Suite 500E

Washington, DC 20001-5369

(202) 220-1100

Elaine.Goldenberg@mto.com

APPENDICES

APPENDIX A

Opinion of the Court of Appeal (Cal. Ct.

App. Sept. 28, 2023) ................................................. 1a

APPENDIX B

Opinion of the Superior Court (Cal.

Super. Ct. Sept. 1, 2022)........................................ 30a

APPENDIX C

Order of the California Supreme Court

(Cal. Jan. 17, 2024) ................................................ 44a

APPENDIX D

Constitutional and Statutory

Provisions Involved................................................ 45a

APPENDIX E

Amended Complaint, García-Brower v. Lyft,

Inc. (Cal. Super. Ct. Nov. 18, 2020) ...................... 46a

APPENDIX F

Amended Complaint, People of the State

of California v. Uber Technologies, Inc.

(Cal. Super. Ct. June 21, 2022) ............................. 87a

APPENDIX A

IN THE COURT OF APPEAL OF THE STATE OF

CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

In re UBER TECHNOLOGIES WAGE AND HOUR

CASES.

A166355

(San Francisco County Super. Ct.

No. CJC-21-005179; J.C.C.P. No. 5179)

[Filed September 28, 2023]

In these coordinated proceedings, defendants Uber

and Lyft 1 appeal after the trial court denied their motions to compel arbitration of claims brought against

them in civil enforcement actions by the People of the

State of California (the People) 2 and by the Labor Commissioner through the Division of Labor Standards

Enforcement (DLSE). 3 We conclude the court correctly

denied the motions because the People and the Labor

Commissioner are not parties to the arbitration agreements invoked by Uber and Lyft. We therefore affirm.

The defendants are (1) Uber Technologies, Inc., and certain of

its affiliated entities (collectively, Uber), and (2) Lyft, Inc. (Lyft).

The Attorney General of California, joined by city attorneys of

the cities of Los Angeles, San Diego, and San Francisco, brought

the action on behalf of the People.

The DLSE is a division within the Department of Industrial Relations. (Lab. Code, §§ 21, 79.) We will use the terms DLSE and

Labor Commissioner interchangeably.

BACKGROUND

A. The People’s and the Labor Commissioner’s Actions Against Uber and Lyft

In May 2020, the People filed this action. In their

operative complaint, the People allege Uber and Lyft

violated the Unfair Competition Law (Bus. & Prof.

Code, § 17200 et seq.) (UCL) by misclassifying their

California ride-share and delivery drivers as independent contractors rather than employees, thus depriving them of wages and benefits associated with

employee status. 4 The People allege the misclassification harms workers, competitors, and the public. The

People seek injunctive relief, civil penalties, and restitution under the UCL. (Bus. & Prof. Code, §§ 17203,

17204, 17206.) The People also seek injunctive relief

under the statutory scheme established by Assembly

Bill No. 5 (2019–2020 Reg. Sess.) (Assembly Bill 5),

specifically Labor Code section 2786, 5 which authorizes such relief to prevent misclassification of employees as independent contractors.

The People sought, and the trial court entered, a

preliminary injunction prohibiting Uber and Lyft from

misclassifying their drivers as independent contractors in violation of Assembly Bill 5. (People v. Uber

Technologies, Inc., supra, 56 Cal.App.5th at pp. 281–

282.) We affirmed in an October 2020 opinion. (Id. at

p. 316.) Following the passage of Proposition 22,

We discussed the People’s claims and other relevant background

more fully in People v. Uber Technologies, Inc. (2020)

56 Cal.App.5th 266, 273, 274–282.

The injunctive relief provision of Assembly Bill 5 was originally

codified as Labor Code section 2750.3, subdivision (j)

(Stats. 2019, ch. 296, § 2) and was later transferred to section

2786 (Stats. 2020, ch. 38, §§ 1–2). (See People v. Uber Technologies, Inc., supra, 56 Cal.App.5th at p. 274, fn. 3.)

which altered the standards for determining whether

app-based drivers are independent contractors (Bus. &

Prof. Code, § 7451), the People and Uber and Lyft stipulated to dissolve the preliminary injunction, which

had been stayed since it was entered. The People’s operative first amended and supplemental complaint

clarifies that the People seek injunctive relief to the

extent Proposition 22 is unconstitutional or otherwise

invalid. 6

In August 2020, the Labor Commissioner filed separate actions against Uber and Lyft, pursuant to her

enforcement authority under the Labor Code. (E.g.,

Lab. Code, §§ 61, 90.5, 95, 98.3, subd. (b).) The Labor

Commissioner alleges Uber and Lyft have misclassified drivers as independent contractors and have thus

violated certain Labor Code provisions and wage orders. The Labor Commissioner seeks injunctive relief,

civil penalties payable to the state, and unpaid wages

and other amounts alleged to be due to Uber’s and

Lyft’s drivers, such as unreimbursed business expenses. 7

The validity of Proposition 22 under the state constitution is a

question now pending before the California Supreme Court. (Castellanos v. State of California (2023) 89 Cal.App.5th 131, review

granted June 28, 2023, S279622.)

As noted, the People and the Labor Commissioner filed their actions pursuant to statutory authority as public enforcement officials. (Bus. & Prof. Code, §§ 17203, 17204, 17206; Lab. Code,

§§ 2786, 61, 90.5, 95, 98.3, subd. (b).) Their actions are not private attorney general actions, i.e., they are not actions “brought

by an aggrieved employee on behalf of himself or herself and other

current or former employees” as authorized by the Labor Code

Private Attorneys General Act of 2004 (Lab. Code, § 2698 et seq.)

(PAGA). (Lab. Code, § 2699, subd. (a).) They are direct enforcement actions by public prosecutors acting under specific statutory

grants of prosecutorial authority.

The People’s action and the Labor Commissioner’s

actions were coordinated (along with other cases not

involved in this appeal) 8 as part of Uber Technologies

Wage and Hour Cases.

B. Uber’s and Lyft’s Motions To Compel Arbitration Based on Their Arbitration Agreements

With Drivers

As we noted in People v. Uber Technologies, Inc., supra, 56 Cal.App.5th at p. 312, fn. 24, foreshadowing

this appeal, Uber and Lyft filed motions to compel arbitration in the People’s action; they also filed similar

motions in the Labor Commissioner’s actions. Uber

and Lyft sought to require arbitration of those actions

to the extent they seek remedies that Uber and Lyft

characterize as “driver-specific” or “ ‘individualized’ ”

relief, such as restitution under the UCL and unpaid

wages under the Labor Code.

Uber’s and Lyft’s motions did not seek to compel arbitration of the People’s and the Labor Commissioner’s

requests for civil penalties and injunctive relief, but

they nonetheless asked the court to stay those portions

of the actions pending completion of any driver arbitrations. Finally, as an alternative to their requests to

compel arbitration, Uber and Lyft asked the court to

strike the People’s and the Labor Commissioner’s requests for restitution and certain other relief.

In their motions, Uber and Lyft relied on arbitration

agreements they entered into with drivers. The agreements require drivers to arbitrate on an individual basis most disputes arising from their relationship with

According to the parties’ briefs in this appeal, those other cases

(which also allege misclassification of employees as independent

contractors) were brought by private parties under PAGA.

Uber or Lyft. The People and the Labor Commissioner

are not parties to the agreements.

Following coordination, the parties filed additional

briefing pertaining to the motions, and the trial court

heard argument on August 26, 2022. On September 1,

2022, the court entered an order denying Uber’s and

Lyft’s motions.

Uber and Lyft appealed.

II.

DISCUSSION

Uber and Lyft contend the arbitration agreements

they entered into with their drivers require that portions of the civil enforcement actions brought by the

People and the Labor Commissioner be compelled to

arbitration. If this court orders arbitration, they argue, the remaining portions of the People’s and the Labor Commissioner’s actions should be stayed. We conclude, as the trial court did, that there is no basis to

compel arbitration.

A. Standard of Review

“Whether an arbitration agreement binds a third

party is a legal question we review de novo.” (Department of Fair Employment and Housing v. Cisco Systems, Inc. (2022) 82 Cal.App.5th 93, 99 (Cisco).)

B. The People and the Labor Commissioner

Are Not Bound by Uber’s and Lyft’s Arbitration

Agreements with Their Drivers

Both the federal government and California have

strong public policies “ ‘in favor of arbitration as an expeditious and cost-effective way of resolving disputes.’ ”

(People v. Maplebear Inc. (2022)

81 Cal.App.5th 923, 930 (Maplebear).) But “[e]ven

though the ‘ “ ‘law favors contracts for arbitration of

disputes between parties’ [citation], ‘ “there is no

policy compelling persons to accept arbitration of controversies which they have not agreed to arbitrate . . . .” ’ ” ’ ” (Id. at p. 931.)

The trial court correctly concluded there is no basis

to compel arbitration here because the People and the

Labor Commissioner are not parties to the arbitration

agreements Uber and Lyft entered into with their drivers. Uber and Lyft contend arbitration nevertheless

should be compelled on the basis of either (1) federal

preemption or (2) equitable estoppel. We disagree. 9

1. Preemption

Uber and Lyft argue the Federal Arbitration Act (9

U.S.C. § 1 et seq.) (FAA) precludes the People and the

Labor Commissioner from pursuing in court some of

the types of relief they seek in their enforcement actions, including restitution under the UCL and unpaid

wages and business expenses of drivers under the Labor Code. Characterizing these forms of relief as “individualized” or “driver-specific,” they argue that, because such relief may benefit individual drivers, any

claim seeking it “belong[s]” to the drivers (and the People and the Labor Commissioner only “stand[] in the

[drivers’] shoes,” while the drivers are the “real parties

in interest”). Thus, they conclude, those portions of the

People’s and the Labor Commissioner’s actions must

be compelled to arbitration. We disagree.

Because we hold the People and the Labor Commissioner are

not bound by the arbitration agreements between Uber and Lyft

and their drivers, we need not address (1) the Labor Commissioner’s argument that Uber and Lyft have not provided sufficient

evidence of such agreements because they produced no signed

agreements, or (2) defendants’ contentions that the agreements

are valid and binding as between the parties who entered them.

We will assume for purposes of this opinion that the arbitration

agreements bind drivers who entered them.

The United States Supreme Court has emphasized

that, while the FAA embodies a strong federal policy

in favor of enforcing parties’ agreements to arbitrate,

that policy is founded on the parties’ consent, and

there is no policy in favor of requiring arbitration of

disputes the parties have not agreed to arbitrate. (Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. __,

__ [142 S.Ct. 1906, 1918] (Viking River) [“the ‘first

principle’ of our FAA jurisprudence” is “that ‘[a]rbitration is strictly “a matter of consent” ’ ”]; id. at p. __

[142 S.Ct. at p. 1917]; E.E.O.C. v. Waffle House, Inc.

(2002) 534 U.S. 279, 294 (Waffle House) [“Because the

FAA is ‘at bottom a policy guaranteeing the enforcement of private contractual arrangements,’ [citation],

we look first to whether the parties agreed to arbitrate

a dispute, not to general policy goals, to determine the

scope of the agreement.”].)

“ ‘ ‘Whether an agreement to arbitrate exists is a

threshold issue of contract formation and state contract law.” [Citations.] “The party seeking to compel

arbitration bears the burden of proving the existence

of a valid arbitration agreement.” ’ [Citation.] ‘Because arbitration is a matter of contract, generally

“ ‘one must be a party to an arbitration agreement to

be bound by it or invoke it.’ ” ’ [Citation.] ‘However,

both California and federal courts have recognized limited exceptions to this rule, allowing nonsignatories to

an agreement containing an arbitration clause to compel arbitration of, or be compelled to arbitrate, a dispute arising within the scope of that agreement.’ [Citation.] ‘ “ ‘As one authority has stated, there are six

theories by which a nonsignatory may be bound to arbitrate: “(a) incorporation by reference; (b) assumption; (c) agency; (d) veil-piercing or alter ego; (e) estoppel; and (f) third party beneficiary.” ’ ” ’ ” (Maplebear,

supra, 81 Cal.App.5th at pp. 931–932.)

Here, as noted, the People and the Labor Commissioner are not parties to the arbitration agreements at

issue. And none of the above theories supports compelling their claims to arbitration. We reject Uber’s

and Lyft’s suggestion that the People and the Labor

Commissioner should be bound because they allegedly

are mere proxies for Uber’s and Lyft’s drivers. (See

Cisco, supra, 82 Cal.App.5th at p. 99 [addressing a

similar claim; noting the “proxy” theory was “along

[the] lines” of the assumption, agency, and alter ego

theories].)

The relevant statutory schemes expressly authorize

the People and the Labor Commissioner to bring the

claims (and seek the relief) at issue here. (Bus. & Prof.

Code, §§ 17203, 17204, 17206 [authority for Attorney

General and other public prosecutors to sue in the

name of the People under the UCL]; Lab. Code, § 2786

[authority under Assembly Bill 5]; id., §§ 61, 90.5, 95,

98.3, subd. (b) [Labor Commissioner’s authority].) The

public officials who brought these actions do not derive

their authority from individual drivers but from their

independent statutory authority to bring civil enforcement actions, and, as we discuss further below, there

is no basis for binding them to arbitration agreements

Uber and Lyft entered with drivers.

a. Waffle House Establishes the Drivers’ Arbitration Agreements Do Not Bar the People and the Labor

Commissioner from Seeking Judicial Relief

In Waffle House, the United States Supreme Court

held that the federal Equal Employment Opportunity

Commission (EEOC) is not bound by employee arbitration agreements because it has the ability to determine

whether to file suit and what relief to pursue. (Waffle

House, supra, 534 U.S. at pp. 291, 282, 285, 297–298.)

An employee’s agreement to arbitrate certain claims

does not bar the EEOC from pursuing “victim-specific

judicial relief” (as well as injunctive relief) in its own

action. (Id. at pp. 282, 285, 297–298.) The high court

rejected arguments that the EEOC’s claims in this setting are “derivative” and that the EEOC is a “proxy for

the employee.” (Id. at pp. 297–298.)

Recent decisions by California appellate courts have

followed Waffle House, holding that public agencies

bringing enforcement actions as authorized by statute

are not bound by arbitration agreements between private parties. In Maplebear, a case very similar to this

one, the San Diego City Attorney brought an enforcement action under the UCL on behalf of the People,

alleging Instacart misclassified its shoppers as independent contractors.

(Maplebear, supra, 81

Cal.App.5th at p. 926.) The trial court denied Instacart’s motion to compel arbitration, and the appellate

court affirmed, holding that, under Waffle House, arbitration agreements between Instacart and its shoppers were not binding on the People. (Maplebear, at

pp. 926–927, 935.)

The Maplebear court rejected Instacart’s contention

that the FAA supported a contrary result because the

People allegedly were “deputized” by the shoppers.

(Maplebear, supra, 81 Cal.App.5th at pp. 934–935.)

Instead, the court held, the City of San Diego was acting in its own law enforcement capacity to seek relief

under the UCL. (Maplebear, at p. 934.) The court explained that “the FAA is not concerned with the ability

of the State of California to prosecute violations of the

Labor Code and to seek civil penalties and related relief for those violations under the UCL. Contrary to

Instacart’s assertion, the Shoppers are not the real

party in interest in this case, the People are.” (Id. at

p. 935.)

Similarly, in Cisco, supra, 82 Cal.App.5th at p. 97,

the appellate court addressed whether the

10a

Department of Fair Employment and Housing (now

named the Civil Rights Department) could be “compelled to arbitrate an employment discrimination lawsuit when the affected employee agreed to resolve disputes with the employer through arbitration.” Affirming the trial court’s denial of a motion to compel arbitration, the appellate court held the Department could

not be required to arbitrate because it did not agree to

do so. (Ibid.) The Cisco court rejected the employer’s

claim that the Department should be bound because it

was a “proxy” for the employee and was “not acting independently.” (Id. at p. 99.)

Instead, the Cisco court explained, the Department

acts independently and pursuant to express statutory

authority when it sues for violations of the Fair Employment and Housing Act.

(Cisco, supra,

82 Cal.App.5th at pp. 99–100, 103–104, citing Waffle

House, supra, 534 U.S. at p. 291.) “As an independent

party, the Department cannot be compelled to arbitrate under an agreement it has not entered.” (Cisco,

at p. 104; see Crestwood Behavioral Health, Inc. v.

Lacy (2021) 70 Cal.App.5th 560, 581–585 [recognizing,

following Waffle House, that the Labor Commissioner

has independent statutory authority to investigate

and obtain victim-specific relief under the Labor Code

and to protect the public interest, regardless of

whether an individual employee’s claim has been compelled to arbitration].)

We agree with the analysis in Maplebear and Cisco.

We hold that, under Waffle House, the People and the

Labor Commissioner are not bound by arbitration

agreements they did not enter. The FAA does not preclude them from exercising their statutory authority

to enforce the law and to seek appropriate remedies,

including injunctive relief and civil penalties, as well

as restitution and other “victim-specific judicial relief.”

11a

(Waffle House, supra, 534 U.S. at p. 282; id. at pp. 285,

297–298.) The trial court correctly so held. As we discuss below, Uber’s and Lyft’s arguments to the contrary are not persuasive.

b. Viking River Provides No Basis for Reversal

Uber and Lyft contend the high court’s decision in

Viking River requires that the People and the Labor

Commissioner be bound to Uber’s and Lyft’s arbitration agreements with their drivers. We disagree. Viking River involved a different issue—whether California’s rule invalidating waivers of representative

claims under PAGA is preempted by federal law. (Viking River, supra, 596 U.S. at p. __ [142 S.Ct. at

p. 1913]; see Adolph v. Uber Technologies, Inc. (2023)

14 Cal.5th 1104, 1113–1114 [discussing Viking

River].) In this case, the actions brought by the People

and the Labor Commissioner are not private attorney

general actions under PAGA. The PAGA plaintiff in

Viking River, a former employee of the defendant, had

signed an agreement to arbitrate any dispute arising

out of her employment (Viking River, at p. __

[142 S.Ct. at pp. 1915–1916]), and the high court did

not address any claim that a plaintiff who was a nonsignatory to the agreement should be bound.

Uber and Lyft dwell on language in a footnote in Viking River (footnote 4), in which the high court stated

that, “[a]lthough the terms of [9 U.S.C.] § 2 limit the

FAA’s enforcement mandate to agreements to arbitrate controversies that ‘arise out of’ the parties’ contractual relationship,[10] disputes resolved in PAGA

Section 2 of the FAA (9 U.S.C. § 2) states in relevant part: “A

written provision in . . . a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter

arising out of such contract or transaction . . . shall be valid,

12a

actions satisfy this requirement. The contractual relationship between the parties is a but-for cause of any

justiciable legal controversy between the parties under

PAGA, and ‘arising out of’ language normally refers to

a causal relationship. [Citation.] And regardless of

whether a PAGA action is in some sense also a dispute

between an employer and the State, nothing in the

FAA categorically exempts claims belonging to sovereigns from the scope of [9 U.S.C.] § 2.” (Viking River,

supra, 596 U.S. at p. __, fn. 4 [142 S.Ct. at p. 1919,

fn. 4].) This passage, Uber and Lyft tell us, supports

their effort to bind the People and the Labor Commissioner to arbitration agreements with their drivers.

We disagree. In our view, the cited passage establishes that, when an employee who has agreed to arbitrate claims against an employer brings a PAGA action, then (even if that action could be said to be a dispute between an employer and the state) the FAA requires that the employee submit to arbitration any

claim covered by the agreement, because the claim

arises out of the contractual relationship between the

parties. (Viking River, supra, 596 U.S. at p. __, fn. 4

[142 S.Ct. at p. 1919, fn. 4]; id. at p. __ [142 S.Ct. at

pp. 1915–1916].) As we read it, the passage addresses

which claims (brought by a plaintiff who was a signatory to an arbitration agreement) are to be submitted

to arbitration pursuant to the FAA’s mandate. (Viking

River, at p. __, fn. 4 [142 S.Ct. at p. 1919, fn. 4].) The

Viking River court did not cite Waffle House and did

not state it was altering or limiting the holding in that

case. And nowhere in footnote 4 or elsewhere in the

Viking River opinion did the high court state it was

addressing or expanding the category of litigants who

irrevocable, and enforceable, save upon such grounds as exist at

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

13a

are covered by the FAA’s mandate to include public enforcement agencies who did not agree to arbitrate any

claims against the employer.

Indeed, as noted above, far from suggesting parties

should be bound to arbitrate where they have not

agreed to do so, the Viking River court emphasized

that “the ‘first principle’ of our FAA jurisprudence” is

“that ‘[a]rbitration is strictly “a matter of consent.” ’ ”

(Id. at p. __ [142 S.Ct. at p. 1918]; accord, Cisco, supra,

82 Cal.App.5th at p. 103 [noting that Viking River “reaffirmed . . . that arbitration is a matter of consent and

a party cannot be compelled to arbitrate absent a contractual basis for concluding the party agreed to do

so”].) We reject Uber’s and Lyft’s argument that Viking River supports reversal here.

The other cases cited by Uber and Lyft in support of

their preemption argument similarly do not require

arbitration by a public enforcement agency that is not

a party to an arbitration agreement. Instead, the cited

cases involve plaintiffs who agreed to arbitrate certain

types of disputes, and the issue raised on appeal was

which claims or relief pursued by those plaintiffs were

subject to arbitration in light of their agreements and

the FAA. (E.g., Epic Systems Corp. v. Lewis (2018)

584 U.S. __, __ [138 S.Ct. 1612, 1619–1621] [employee

agreed to arbitrate employment-related disputes on an

individual basis; FAA required enforcing this agreement and precluding employee’s effort to pursue

claims in court as representative of a class]; Cruz v.

PacifiCare Health Systems, Inc. (2003) 30 Cal.4th 303,

309–310, 317–318 [consumer-plaintiff was alleged to

be bound by arbitration agreement; his request for restitution under the UCL was arbitrable]; Esparza v. KS

Industries, L.P. (2017) 13 Cal.App.5th 1228, 1235,

1239, 1246 [employee-plaintiff agreed to arbitrate employment-related claims and later brought PAGA

14a

action; appellate court held that, under then-applicable Iskanian 11 framework, the employee’s claims for

unpaid wages for himself and other employees “retain

their private nature and continue to be covered by the”

FAA].) Uber and Lyft cite no case holding a state government body or official that did not agree to arbitration can be barred from enforcing the law in court

based on an arbitration agreement entered by others.

Defendants’ reliance on Preston v. Ferrer (2008)

552 U.S. 346 is also misplaced. Preston held that,

“when parties agree to arbitrate all questions arising

under a contract, state laws lodging primary jurisdiction in another forum, whether judicial or administrative, are superseded by the FAA.” (Id. at pp. 349–350.)

The Preston court distinguished Waffle House, noting

that in that case, “the Court addressed the role of an

agency, not as adjudicator but as prosecutor, pursuing

an enforcement action in its own name . . . .” (Preston,

at p. 359.) Here, of course, the People and the Labor

Commissioner are acting as prosecutors, not adjudicators. Waffle House, not Preston, controls.

Similarly unpersuasive is Uber’s and Lyft’s reliance

on the statement in Department of Industrial Relations

Continental

Casualty

Co.

(1996)

52 Cal.App.4th Supp. 1, 3, that the Legislature,

through Labor Code provisions authorizing the DLSE

to collect wages or benefits on behalf of a worker without assignment, “intended to put the DLSE right into

the shoes of the worker for the purpose of such wage

litigation.” Based on this conclusion, the appellate division in Department of Industrial Relations held that

the DLSE (like a wage earner) was exempt from a

Iskanian v. CLS Transportation Los Angeles, LLC (2014)

59 Cal.4th 348 (Iskanian), overruled in part by Viking River, supra, 596 U.S. at p. __ [142 S.Ct. at p. 1924].

15a

statutory notice requirement. (Ibid.) The court addressed no question of arbitrability and did not suggest the DLSE or other public agency is bound to an

arbitration agreement it did not enter. We decline to

read the court’s brief, general statement as authority

for a proposition it did not consider.

Nor do Howitson v. Evans Hotels, LLC (2022)

81 Cal.App.5th 475 and Department of Fair Employment and Housing v. Lucent Technologies, Inc. (9th

Cir. 2011) 642 F.3d 728, two other cases cited by defendants, persuade us reversal is warranted. Those

decisions held, in contexts unrelated to arbitration,

that the legislative conferral of standing to sue does

not necessarily establish the named plaintiff is the real

party in interest. (Howitson, at pp. 488–489, 491–492

[in PAGA action, the state is the real party in interest,

although an aggrieved employee has standing to sue;

therefore, for purposes of claim preclusion, an employee’s individual lawsuit and her later PAGA action

were not brought by the same party] 12; Lucent Technologies, at p. 738 & fn. 4 [while state statute “support[ed] a finding that California is a real party in interest for the purposes of standing,” the statutory language “fail[ed] to render it a real party in the controversy for the purposes of [federal] diversity jurisdiction”].) Neither case addresses any issue relating to

arbitrability or holds that a public enforcement agency

must arbitrate its claims because the relief it obtains

may benefit individuals.

Code of Civil Procedure section 367 (“Every action must be prosecuted in the name of the real party in interest, except as otherwise provided by statute.”).

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c. Defendants’ Efforts To Distinguish Waffle

House Are Not Persuasive

In a separate line of attack, Uber and Lyft contend

that Waffle House is distinguishable, in part because

it involved claims for victim-specific relief brought by

a federal agency, 13 and that Maplebear and Cisco

(which applied the Waffle House holding to suits by

state government actors) are distinguishable or were

incorrectly decided. We reject these arguments and

hold Waffle House applies here.

It is, of course, true that Waffle House involved a

federal agency (the EEOC) suing under a federal antidiscrimination statute, the Americans with Disabilities Act (ADA). (Waffle House, supra, 534 U.S. at

pp. 282–283.) But in our view, the court’s analysis and

holding apply here and establish that a government

body exercising express statutory authority to seek judicial relief (including “victim-specific” relief) cannot

be barred from doing so on the ground the agency is

supposedly a mere “proxy” of an individual employee

who entered an arbitration agreement. (Id. at pp. 282,

285,

297–298;

accord,

Maplebear,

supra,

81 Cal.App.5th at pp. 926–927, 934–935; Cisco, supra,

82 Cal.App.5th at pp. 99–100, 103–104.) As with the

agencies in Waffle House, Maplebear, and Cisco, the

People and the Labor Commissioner are not parties to

the arbitration agreements invoked in this case, and

they may pursue their claims in court.

Uber and Lyft argue the statutory schemes at issue

here differ in certain respects from the one in Waffle

House, including as to whether the government agency

Uber also states Waffle House “predates” the high court’s “modern arbitration decisions.” Waffle House has not been overruled,

and we will follow it.

17a

has an exclusive right to pursue claims and whether it

is bound by the same statute of limitations as a private

individual. (Waffle House, supra, 534 U.S. at pp. 291,

287, 297.) But in our view, the Waffle House court’s

statements on these points do not provide a basis to

depart from its holding. Like the EEOC (id. at

pp. 291–292), the People and the Labor Commissioner

decide whether to bring claims within their statutory

authority, and their ability to do so does not depend on

the consent or approval of individual employees. Despite variations in the statutory schemes at issue, we

conclude Waffle House applies here. The People and

the Labor Commissioner are not acting as proxies for

drivers but bringing independent civil enforcement actions, and they are not barred from seeking judicial relief by arbitration agreements they did not enter. (See

id. at pp. 297–298.)

As to Maplebear and Cisco, Uber and Lyft contend

those cases are distinguishable, in part because the defendants there sought to compel larger portions of the

civil enforcement actions to arbitration. But in both

cases the relief sought by the public enforcement agencies included restitution or other victim-specific relief

(Maplebear, supra, 81 Cal.App.5th at p. 928; Cisco, supra, 82 Cal.App.5th at p. 98), and the appellate courts

held that no portion of those actions should be compelled to arbitration, because the public prosecutors

had not agreed to arbitrate. (Maplebear, at pp. 926–

927, 935; Cisco, at pp. 97, 104.) For the reasons we

have discussed, we agree.

d. The People’s and the Labor Commissioner’s Exercise of Their Statutory Law Enforcement Authority

Does Not Pose an Obstacle to the FAA

Uber and Lyft argue that, where state agencies are

involved, their pursuit of restitution and other statutory remedies that may benefit individual employees

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should be held to be preempted because such agency

action stands as an “obstacle to the accomplishment of

the FAA’s objectives.” (Citing AT&T Mobility LLC v.

Concepcion (2011) 563 U.S. 333, 343, 352.) We do not

agree. As discussed, the FAA does not embody a policy

in favor of compelling arbitration of disputes in the absence of consent. (Viking River, supra, 596 at p. __

[142 S.Ct. at p. 1918]; Waffle House, supra, 534 U.S. at

p. 294.)

Uber contends the People’s and the Labor Commissioner’s pursuit of restitution and similar relief in

court will interfere with drivers’ arbitration agreements because a judgment in the present action could

be preclusive of certain issues in future arbitrations,

thus causing drivers to “forever lose the ability to bring

their claims in the arbitral forum they agreed to.” The

People dispute Uber’s claim that the present action

will have preclusive effect in drivers’ individual arbitrations. We need not resolve this point. Even if there

could be some future preclusive effect on ongoing or future arbitrations, Uber presents no authority requiring that litigation in court by nonparties to an arbitration agreement must be barred whenever it is possible

such litigation could affect an arbitration between signatories to an agreement requiring that form of dispute resolution in their private relations.

Uber also argues that individual drivers cannot

avoid arbitration by assigning or transferring their

claims to another individual, and Uber asserts “that is

exactly what is happening here.” Lyft similarly contends that, if a “third party” such as “a successor in

interest, assignee, bankruptcy trustee, or class action

representative,” sought to pursue “a driver’s claim for

monetary relief,” the driver’s arbitration agreement

“would control.” But as discussed, the People and the

Labor Commissioner are pursuing their own statutory

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claims. They are not assignees or other similarly situated third parties seeking to present claims held by

drivers. (DMS Services, LLC v. Superior Court (2012)

205 Cal.App.4th 1346, 1353 [The “exceptions to the

general rule that one must be a party to an arbitration

agreement to invoke it or be bound by it ‘generally are

based on the existence of a relationship between the

nonsignatory and the signatory, such as principal and

agent or employer and employee, where a sufficient

“identity of interest” exists between them.’ ”].) The

People and the Labor Commissioner also are not acting as class representatives as would an employee representing other similarly situated employees. Finally,

for the same reason, Uber is incorrect in describing the

People and the Labor Commissioner as “nominal

part[ies] controlling the litigation of drivers’ claims”

and as the drivers’ “litigation counsel.”

Uber suggests in its reply brief that a nonsignatory

plaintiff such as the People should be compelled to arbitration without regard to whether the nonsignatory

has any relationship with a party to the arbitration

agreement, so long as the nonsignatory’s claims can be

said to arise out of the contract that contains the

agreement. In support, Uber cites Viking River, Epic

Systems, and Concepcion, but those cases do not support Uber’s argument. In each case, the individual

plaintiff or plaintiffs bringing a PAGA claim (Viking

River) or seeking to represent a plaintiff class (Epic

Systems, Concepcion) had entered an arbitration

agreement. (Viking River, supra, 596 U.S. at p. __

[142 S.Ct. at pp. 1915–1916]; Epic Systems Corp. v.

Lewis, supra, 584 U.S. at p. __ [138 S.Ct. at pp. 1619–

1621]; AT&T Mobility LLC v. Concepcion, supra,

563 U.S. at p. 336.) As we have discussed, none of

these cases holds that public law enforcement officials

must arbitrate their statutory claims when they have

20a

not agreed to do so and have no preexisting relationship with the parties to the arbitration agreement.

Finally, Lyft asserts that state law should not permit public enforcement agencies to bring claims “on behalf of” individual drivers who entered arbitration

agreements, because if that is permissible, then state

law could similarly “deputize” a private citizen to bring

suit on behalf of a person who has agreed to arbitration, a result that Lyft contends would run afoul of the

California Supreme Court’s decision in Iskanian, supra, 59 Cal.4th 348. That argument is not well taken.

In the relevant passage from Iskanian (which Lyft

quotes only in part), the court explained that its holding on the PAGA issues raised there “would not permit

a state to circumvent the FAA by, for example, deputizing employee A to bring a suit for the individual

damages claims of employees B, C, and D. This pursuit of victim-specific relief by a party to an arbitration

agreement on behalf of other parties to an arbitration

agreement would be tantamount to a private class action, whatever the designation given by the Legislature.” (Iskanian, supra, 59 Cal.4th at pp. 387–388,

italics added.) “Under [the high court’s decision in]

Concepcion, such an action could not be maintained in

the face of a class waiver.” (Id. at p. 388.)

The Iskanian court’s statement that the state could

not designate a party to an arbitration agreement to

pursue the individual damages claims of other parties

to the agreement has no bearing on the issues presented here. As discussed, the People and the Labor

Commissioner are not parties to the arbitration agreements who have been improperly “deputize[d]” to

bring suit for other such parties. They are nonparties

to the agreements who are suing in their law enforcement capacities and pursuing statutorily authorized

remedies. That Lyft can imagine a different scenario

21a

that might violate the FAA provides no basis for reversal here.

Underlying Uber’s and Lyft’s preemption arguments is their assertion that the People’s and the Labor Commissioner’s claims in these actions (to the extent they seek restitution or other relief that may benefit individual drivers) are really the “drivers’ claims”

or claims that “belong to drivers.” We have rejected

this argument. As discussed, the People and the Labor

Commissioner are authorized by statute to bring the

claims at issue here and to seek the relief they request.

The fact some of that relief might benefit individual

drivers (or could be sought by individual drivers on

their own behalf) does not transform the claims

brought here into derivative claims brought by a proxy

for the drivers.

2. Equitable Estoppel

Uber and Lyft argue that, apart from federal

preemption, the People and the Labor Commissioner

are bound by the drivers’ arbitration agreements

based on equitable estoppel. Here, too, we disagree.

The trial court correctly held there is no basis for equitable estoppel on this record.

a. Equitable Estoppel Does Not Apply

As we have discussed, the general rule is that

“ ‘[t]he right to arbitration depends on a contract, and

a party can be compelled to submit a dispute to arbitration only if the party has agreed in writing to do so.’

[Citation.] ‘Even the strong public policy in favor of

arbitration does not extend to those who are not parties to an arbitration agreement or who have not authorized anyone to act for them in executing such an

agreement.’ ” (Jensen v. U-Haul Co. of California

(2017) 18 Cal.App.5th 295, 300 (Jensen).) But as also

noted above, “there are circumstances under which

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persons who have not signed an agreement to arbitrate

are bound to do so,” including “ ‘ “estoppel.” ’ ” (Ibid.)

Specifically, “[a] nonsignatory plaintiff may be estopped from refusing to arbitrate when he or she asserts claims that are ‘dependent upon, or inextricably

intertwined with,’ the underlying contractual obligations of the agreement containing the arbitration

clause. [Citation.] ‘The focus is on the nature of the

claims asserted . . . . [Citations.] That the claims are

cast in tort rather than contract does not avoid the arbitration clause.’ [Citation.] Rather, ‘ “[t]he plaintiff’s

actual dependence on the underlying contract in making out the claim against the nonsignatory . . . is . . .

always the sine qua non of an appropriate situation for

applying equitable estoppel.” ’ [Citation.] ‘[E]ven if a

plaintiff’s claims “touch matters” relating to the arbitration agreement, “the claims are not arbitrable unless the plaintiff relies on the agreement to establish

its cause of action.” ’ [Citation.] ‘The fundamental

point’ is that a party is ‘not entitled to make use of [a

contract containing an arbitration clause] as long as it

worked to [his or] her advantage, then attempt to

avoid its application in defining the forum in which

[his or] her dispute . . . should be resolved.’ ” (Jensen,

supra, 18 Cal.App.5th at p. 306; accord, DMS Services,

LLC v. Superior Court, supra, 205 Cal.App.4th at

p. 1354 [“The reason for this equitable rule is plain:

One should not be permitted to rely on an agreement

containing an arbitration clause for its claims, while

at the same time repudiating the arbitration provision

contained in the same contract.”].)

The trial court correctly concluded equitable estoppel does not apply here because the People’s and the

Labor Commissioner’s claims are not founded on

Uber’s and Lyft’s contracts with their drivers. Instead,

as the court recognized, the People and the Labor

23a

Commissioner are seeking to enforce the UCL and the

Labor Code and are not seeking to enforce or take advantage of any portion of Uber’s and Lyft’s contracts

with their drivers. Indeed, as the court noted, the People and the Labor Commissioner “take the position

that those contracts violate California law requiring

Defendants to classify their drivers as employees.”

As defendants note, the People’s and the Labor

Commissioner’s complaints refer to certain provisions

of the contracts between defendants and their drivers

in outlining the nature of their relationship. But referring to the contract is not sufficient; for equitable

estoppel to apply, the plaintiff must rely on the contract in asserting its claims. (Goldman v. KPMG, LLP

(2009) 173 Cal.App.4th 209, 218.) Plaintiffs here seek

no relief under the contracts, and their claims do not

rely on them.

The cases cited by defendants do not persuade us

that equitable estoppel applies. For example, the present case is different from JSM Tuscany, LLC v. Superior Court (2011) 193 Cal.App.4th 1222, 1239–1240, on

which both defendants rely for the principle that a

nonsignatory plaintiff may in some instances be bound

to arbitrate under principles of equitable estoppel.

JSM Tuscany involved a group of closely related plaintiffs under common ownership, some of whom were

signatories to the contracts that contained the arbitration agreements, and all of whom brought claims that

were based on obligations imposed by those contracts.

(Id. at pp. 1239–1242, 1226 & fn. 2.) Here, there is no

preexisting relationship between the People and the

Labor Commissioner on the one hand, and the drivers

24a

who agreed to arbitrate on the other. 14 And in any

event, as discussed, neither plaintiff presents claims

that depend on, or are inextricably intertwined with,

the obligations imposed by defendants’ contracts with

their drivers. We decline to hold the doctrine of equitable estoppel bars government law enforcement actions in these circumstances.

Nor does Garcia v. Pexco, LLC (2017)

11 Cal.App.5th 782, also cited by defendants, persuade

us it would be inequitable for the People’s and the Labor Commissioner’s actions to proceed in court. In

Garcia, an employee bound by an arbitration agreement with his employer, a staffing company (Real

Time), brought statutory wage claims against the

staffing agency and the company where the employee

had been assigned to work (Pexco), making “no distinction” between them. (Id. at pp. 784–785.) Because the

claims arose out of the plaintiff’s employment relationship with Real Time, and the arbitration agreement

clearly covered statutory claims against Real Time (id.

at pp. 786–788), the appellate court held that, “[o]n

See Jensen, supra, 18 Cal.App.5th at p. 301 (“ ‘The California

cases binding nonsignatories to arbitrate their claims fall into two

categories. In some cases, a nonsignatory was required to arbitrate a claim because a benefit was conferred on the nonsignatory

as a result of the contract, making the nonsignatory a third party

beneficiary of the arbitration agreement. In other cases, the nonsignatory was bound to arbitrate the dispute because a preexisting relationship existed between the nonsignatory and one of the

parties to the arbitration agreement, making it equitable to compel the nonsignatory to also be bound to arbitrate his or her

claim.’ ”); see also JSM Tuscany, LLC v. Superior Court, supra,

193 Cal.App.4th at p. 1240, fn. 20 (“[I]t is difficult to conceive of a

situation in which a nonsignatory party can state a valid claim

based on the contract, without having some legal relationship

with a signatory of the contract or being a third party beneficiary

of the contract.”).

25a

these facts, it is inequitable for the arbitration about

Garcia’s assignment with Pexco to proceed with Real

Time, while preventing Pexco from participating” (id.

at p. 787). We find no similar inequity here, where the

plaintiffs have not agreed to arbitrate with anyone and

do not seek an “ ‘advantage’ ” (Jensen, supra,

18 Cal.App.5th at p. 306) under an employment contract while ignoring its arbitration clause, but instead

seek statutory remedies for defendants’ allegedly

wrongful refusal to treat their drivers as employees.

Finally, in Machado v. System4 LLC (2015)

471 Mass. 204, 210, 212–216, 205 [28 N.E.3d 401],

cited by defendants, the court held equitable estoppel

applied where plaintiff franchisees brought misclassification and other claims against two defendants, one

of whom was not a party to the arbitration agreement

signed by the plaintiffs. The court concluded that the

franchise agreement was significant to the plaintiffs’

claims, and that the plaintiffs had alleged “concerted

misconduct” by the defendants. (Id. at pp. 212–216.)

We are not persuaded a similar result is appropriate

here. In addition to the differing factual settings (including that the plaintiffs here are not signatories to

any arbitration agreement), we conclude, as discussed,

that the misclassification claims asserted in this case

are not “dependent upon, or founded in and inextricably intertwined with, the underlying contractual obligations of” Uber’s and Lyft’s contracts with their drivers. (Goldman v. KPMG, LLP, supra, 173 Cal.App.4th

at p. 218.)

b. Application of Equitable Estoppel Is Unwarranted

We also agree with the trial court that equitable estoppel does not apply here because, under California

law, as our Supreme Court has stated, “it is clear ‘that

neither the doctrine of estoppel nor any other

26a

equitable principle may be invoked against a governmental body where it would operate to defeat the effective operation of a policy adopted to protect the public.’ ” (Kajima/Ray Wilson v. Los Angeles County Metropolitan Transportation Authority (2000) 23 Cal.4th

305, 316, citing County of San Diego v. Cal. Water etc.

Co. (1947) 30 Cal.2d 817, 826.) The trial court may

have overstated the point a bit in suggesting that, if

the People and the Labor Commissioner were forced

into arbitration, it “would nullify the important public

policies underlying the UCL and the Labor Code.”

(Italics added.) But we do think the result sought by

Uber and Lyft here would fundamentally undermine

those policies. Semantics aside, we agree with the trial

court that the outcome Uber and Lyft urge would “effectively negate” Waffle House and the other case law

we have discussed above establishing that an arbitration agreement between private parties does not bar a

public enforcement agency from seeking judicial relief,

including victim-specific relief. Thus, even if the elements of equitable estoppel were otherwise established, we would decline to apply it here.

Uber asserts that only the remedies of injunctive relief and civil penalties serve “a public function,” while

restitution “is mainly about restoring property to those

owed.” This argument does not persuade us equitable

estoppel should apply here. We note initially that, under the orders sought by defendants, even the People’s

and the Labor Commissioner’s requests for injunctive

relief and civil penalties would be stayed pending completion of any ordered arbitrations. But in any event,

we do not agree that an effort by public enforcement

officials to obtain restitution of money allegedly taken

illegally from citizens can be fairly characterized as

not serving a public purpose in the context of the equitable estoppel issue raised here. The Legislature

27a

decided to include restitution as a remedy obtainable

by public prosecutors under the UCL (along with injunctive relief and civil penalties) (Bus. & Prof. Code,

§§ 17203, 17204, 17206), and we decline to hold that

they actually act as surrogates for private parties

when they seek it.

The defendants’ reliance on State of California v. Altus Finance (2005) 36 Cal.4th 1284 (Altus Finance) is

similarly unpersuasive. In Altus Finance, the Supreme Court held that, under applicable Insurance

Code provisions, when the Insurance Commissioner is

acting as conservator of an insolvent insurance company, the Commissioner has the exclusive right to protect the interests of individual policyholders and creditors. (Id. at pp. 1303–1305.) In that context, the Attorney General may not seek restitution for the benefit

of creditors under the UCL “without trespassing on the

Commissioner’s role.” (Altus Finance, at p. 1306; see

id. at pp. 1303–1304, 1307.) In contrast, the Insurance

Code does not preclude the Attorney General in a UCL

action from pursuing public injunctive relief or civil

penalties payable to the state. (Altus Finance, at

pp. 1307–1308.)

The Altus Finance court explained: “It is true that

the Attorney General is the state’s chief law enforcement officer, and that restitution may have a collateral

law enforcement effect, punishing the wrongdoer

against whom restitution is sought. But the primary

purpose of the Attorney General’s attempt at restitution is to recover lost property on behalf of an insolvent

insurer’s creditors and policyholders. As such, he

seeks to perform an action that is quintessentially

within the scope of the Commissioner’s power as conservator and trustee of the insolvent company.” (Altus

Finance, supra, 36 Cal.4th at p. 1305.) In this case, by

contrast, there is no conflict between spheres of

28a

authority conferred on different public officers. Nor is

there anything in the governing statutory text that we

might compare to the limit on law enforcement power

involved in Altus Finance. While that case involved an

Insurance Code provision that established an “express

limit” on the authority of the Attorney General to seek

restitution (Altus Finance, supra, 36 Cal.4th at

p. 1303), there is no comparable provision here that

limits the relief obtainable by the People under the

UCL, and there is nothing that persuades us the available types of relief should be treated differently for

purposes of the equitable estoppel analysis.

C. Other Issues: Defendants’ Requests for Orders Staying or Striking Portions of These Actions

1. The Stay Requests

Since we conclude there is no basis to compel arbitration of any of the People’s or the Labor Commissioner’s claims or requests for relief, we need not address Uber’s and Lyft’s arguments that, if some claims

were compelled to arbitration, the other portions of

these actions (the portions that are not arbitrable)

should be stayed pending completion of the individual

arbitrations.

2. Lyft’s Motion to Strike

As noted, Uber’s and Lyft’s motions to compel arbitration included alternative requests that the trial

court strike plaintiffs’ complaints to the extent they

sought restitution and certain other relief. In its order

denying the motions to compel, the trial court denied

the alternative motions to strike.

29a

Lyft renews its request on appeal, 15 arguing briefly

that, if this court does not compel arbitration, it should

“strike the driver-specific remedies that are subject to

arbitration,” to “avoid creating a conflict with the

FAA,” because such remedies are arbitrable as between Lyft and its drivers. Even assuming the denial

of Lyft’s motion to strike is reviewable in this appeal

under Code of Civil Procedure section 1294.2 16 (which

the People dispute), we find no basis to strike the assertedly “preempted” remedies. For the reasons we

discussed in part II.B.1, ante, the People’s and the Labor Commissioner’s requests for judicial relief, including victim-specific relief, are not preempted.

III.

DISPOSITION

The order denying Uber’s and Lyft’s motions to compel arbitration of, and to stay, the People’s and the Labor Commissioner’s actions is affirmed. The People

and the Labor Commissioner shall recover their costs

on appeal.

STREETER, J.

WE CONCUR:

BROWN, P. J.

FINEMAN, J. *

Uber does not challenge the denial of its motion to strike.

Code of Civil Procedure section 1294.2 provides in part that,

“[u]pon an appeal from” an order denying a motion to compel arbitration, “the court may review the decision and any intermediate ruling, proceeding, order or decision which involves the merits

or necessarily affects the order or judgment appealed from, or

which substantially affects the rights of a party.”

Judge of the Superior Court of California, County of San Mateo,

assigned by the Chief Justice pursuant to article VI, section 6 of

the California Constitution.

30a

APPENDIX B

SUPERIOR COURT OF CALIFORNIA COUNTY OF

SAN FRANCISCO DEPARTMENT 304

COORDINATION PROCEEDING SPECIAL TITLE

[RULE 3.550]

UBER TECHNOLOGIES WAGE AND HOUR

CASES

THIS ORDER RELATES TO:

People of the State of California v. Uber Technologies,

Inc., et al.,

No. CGC-20-584402 (San Francisco Super. Ct.)

Garcia-Brower v. Uber Technologies, Inc., et al.,

No. RG20070281 (Alameda County Super. Ct.)

Garcia-Brower v. Lyft, Inc., et al.,

No. RG20070283 (Alameda County Super. Ct.)

Case No. CJC-21-005179

JUDICIAL COUNCIL COORDINATION

PROCEEDING NO. 5179

ORDER DENYING DEFENDANTS’ MOTIONS TO

COMPEL ARBITRATION OF THE PEOPLE’S AND

LABOR COMMISSIONER’S CASES

Defendants’ motions to compel arbitration of the

People’s and the Labor Commissioner’s cases and to

stay, and Defendants’ alternative motions to strike,

came on for hearing before the Court on August 26,

2022. All parties appeared through their counsel of

record. The matter was reported. For the following

reasons, the Court denies Defendants’ motions in their

entirety.

PROCEDURAL BACKGROUND

In these coordinated actions, Plaintiffs allege that

31a

Uber and Lyft misclassified passenger drivers and/or

food delivery drivers as independent contractors under

the “ABC” worker-classification test established by

Assembly Bill No. 5 (A.B. 5), which took effect on

January 1, 2020. This order concerns three of the

actions brought by governmental plaintiffs: one

brought by the People of the State of California (the

People), represented by the Attorney General and the

City Attorneys of San Francisco, Los Angeles, and San

Diego; and two separate enforcement actions brought

by the Labor Commissioner through the Division of

Labor Standards and Enforcement (DLSE). 1 Those

actions seek injunctive relief, restitution, and penalties

under the Private Attorneys General Act of 2004, Lab.

Code § 2698 et seq. (PAGA), the Labor Code, and the

Unfair Competition Law, Bus. & Prof. Code § 17200 et

seq. (UCL).

Defendants Uber and Lyft filed motions to compel

arbitration in each of the cases before they were

included in this coordinated proceeding. Lyft also filed

an alternative motion seeking to strike Plaintiffs’

requests for restitution, arguing that even if Plaintiffs

may not be compelled to arbitrate under agreements to

which they are not parties, it nevertheless would be

improper for the government to seek such “driverspecific relief’ because it is arbitrable as between

Defendants and their drivers, as well as an alternative

motion to stay. In their motions, Defendants generally

argue that although the People and the Commissioner

are not parties to Defendants’ arbitration agreements

with their drivers, Plaintiffs’ claims arise out of those

The DLSE is a division within the California Department of

Industrial Relations, which in turn is a department within the

California Labor and Workforce Development Agency (“LWDA”).

This Order uses the terms “DLSE” and the “Labor

Commissioner” interchangeably.

32a

agreements, and the restitutionary relief they seek will

be paid directly to the drivers. Thus, both Defendants’

motions to compel arbitration in the People’s case are

limited to the People’s claim for restitution under the

UCL,

which

Defendants

characterize

“individualized” relief. Defendants moved to compel

arbitration of the Labor Commissioner’s separate

enforcement actions or, in the alternative, to strike on

the same grounds.

Defendants have now renewed those motions here.

The People and the Labor Commissioner oppose the

motions.

By stipulation and order filed July 6, 2022, the Court

permitted extensive supplemental briefing on the

motions to address the U.S. Supreme Court’s decision

in Viking River Cruises v. Moriana (2022) 142 S.Ct.

1906, as well as other recent authority.

DISCUSSION

I. Controlling Precedent Mandates Denial of

Defendants’ Motions To Compel The People

and The Commissioner To Arbitrate Their

Claims

Under

Private

Arbitration

Agreements To Which They Are Not Parties.

Although the parties have spilled a great deal of ink

addressing the issues presented by these motions, they

are readily resolved. It is undisputed that neither the

People nor the Commissioner is a party to any of the

arbitration agreements with Defendants’ drivers that

serve as the basis for Defendants’ motions. Further, the

People and the Commissioner act as public prosecutors

when they pursue litigation to enforce the UCL and the

Labor Code, and each is independently empowered to

seek civil penalties, injunctive relief, and other remedies

to vindicate the public interest. As such, they are

independent of Defendants’ drivers, and cannot be bound

33a

by Defendants’ private arbitration agreements with

those

persons.

Under controlling

authority,

Defendants’ motions must be denied. (E.E.O.C. v.

Waffle House, Inc. (2002) 534 U.S. 279; Department of

Fair Employment and Housing v. Cisco Systems, Inc.

(Aug. 5, 2022) 2022 WL 3136003; People v. Maplebear

Inc. (July 28, 2022) 81 Cal.App.5th 923, 2022 WL

2981169.)

Maplebear is indistinguishable. There, the San

Diego City Attorney brought an enforcement action on

behalf of the People against Maplebear dba Instacart.

The People alleged that Instacart unlawfully

misclassified its employees (referred to as “Shoppers”)

as independent contractors, and asserted one cause of

action under the UCL alleging Instacart’s

misclassification of workers was unlawful under the

Labor Code and an unfair business practice. In the

complaint’s prayer for relief, the People sought civil

penalties authorized by the UCL, injunctive relief

requiring Instacart to properly classify its employees,

and restitution to the misclassified employees for unpaid

wages, overtime, and rest breaks, missed meals, and

reimbursement for expenses necessary to perform the

work. (2022 WL 2981169 at *2.)2 In response,

“Instacart filed a motion to compel a portion of the

People’s case—the prayers for injunctive relief and

restitution—to arbitration based on its agreements

with Shoppers.” (Id. (footnote omitted).) The trial court

Defendants attempt to distinguish Maplebear on the ground

that it focused “primarily” on the injunctive relief claim.

However, nothing in the holding of that case turned on the

“primary” relief sought by the People, nor would such a test be

workable in practice. Significantly, the court there specifically

rejected Instacart’s request to compel only “a portion of the

People’s case” to arbitration—precisely the relief Defendants

seek here.

34a

denied the motion, concluding Instacart had not met its

burden to show the existence of a valid agreement to

arbitrate between it and the People. (Id. at *3.) On

appeal, Instacart asserted that “its agreements with

Shoppers required the court to compel arbitration of the

claims here because the City of San Diego’s lawsuit is

brought primarily to effectuate the rights of the

Shoppers, whom Instacart characterizes as the real

parties in interest.” (Id.)

The Court of Appeal disagreed and affirmed the

trial court’s order denying the motion to compel

arbitration. As the court noted, Instacart conceded that

the City was not a signatory to its arbitration

agreements with Shoppers. (Id. at *4.) Instacart

argued, however, that “the City is bound by the

agreements because it is, in effect, representing, or

seeking to validate the individual employment law

rights of, the Shoppers,” who it asserted were the real

parties in interest in the case. (Id.) As a result,

Instacart argued that “the City’s injunctive relief and

restitution claims here are private claims of the

Shoppers that must be compelled to arbitration.” (Id.)

The court disagreed. As it explained, “[t]he People are

not deputized by the UCL to vindicate the individual

rights of Instacart’s Shoppers. Rather, the City of San

Diego is acting in its own law enforcement capacity ‘to

seek civil penalties for Labor Code violations

traditionally prosecuted by the state.’” (Id at *6, quoting

Iskanian v. CLS Transportation Los Angeles, LLC

(2014) 59 Cal.4th 348, 388.) In light of that independent

authority, the court squarely rejected Instacart’s

contention that the Shoppers were the “real parties in

interest” in the case: “Contrary to Instacart’s assertion,

the Shoppers are not the real party in interest in this

case, the People are.” (Id. (footnote omitted).)

The court followed E.E.O.C. v. Waffle House, Inc.

35a

(2002) 534 U.S. 279, which it found to be “the relevant

binding authority.” (ld.) 3 In Waffle House, the High

Court held that an agreement between an employer and

an employee to arbitrate employment-related disputes

does not bar the EEOC from pursuing victim-specific

judicial relief, such as backpay, reinstatement and

damages, in an enforcement action alleging that the

employer violated federal law, the Americans with

Disabilities Act. The Court of Appeals had attempted

to draw the same distinction that Defendants urge

here between injunctive and victim-specific relief,

ruling that the EEOC is barred from obtaining the

latter. (Id at 290.) The Supreme Court reversed,

holding “whenever the EEOC chooses from among the

many charges filed each year to bring an enforcement

action in a particular case, the agency may be seeking

to vindicate a public interest, not simply provide

make-whole relief for the employee, even when it

pursues entirely victim-specific relief.” (Id. at 295

(emphasis added.)) That an employee has signed a

mandatory arbitration agreement does not limit the

remedies available to the EEOC or “authorize the

courts to balance the competing policies of the ADA

and the FAA or to second-guess the agency’s judgment

concerning which of the remedies authorized by law

that it shall seek in any given case.” (Id. at 297.)

The Maplebear court found Waffle House to be

squarely on point. (81 Cal.App.5th at *6.) As it

explained,

Like the EEOC in Waffle House, the City is

indisputably not a party to any arbitration

agreement with Instacart.

No individual

shopper has control over this litigation and the

In view of that language, Defendants’ insistence that Waffle

House is “irrelevant” is unavailing.

36a

City did not need any individual Shopper’s

consent to bring the action. Like the EEOC, the

City is in command of the process and controls

both the litigation strategy and disposition of any

recovery obtained for the employees. Just like

the statutory authorization that gives the EEOC

authority to pursue discrimination cases against

employers, even where parallel private statutory

claims may also lie, the UCL provides the City of

San Diego with the same type of independent

authority to assert UCL claims, including claims

to enjoin unlawful and unfair business practices

and obtain restitution for those who have been

harmed by those practices.

Further, as the trial court found, the City’s

claims for civil penalties and injunctive relief

seek to vindicate public harms. That the

complaint

also

includes

victim-specific

restitution does not make the case private in

nature. Rather, as Waffle House held, a

government enforcement action that includes

monetary relief for the victims of the unlawful

activity advances a public purpose because while

punitive damages benefit the individual

employee, they also serve an obvious public

function in deterring future violations.

In addition, California courts have consistently

held that the primary interest of law enforcement

actions under the UCL is protecting the public,

not private interests.

(Id. at *7-*8 (cleaned up).)

Maplebear also rejected Instacart’s reliance on the

Broughton-Cruz rule, which Lyft raised at the hearing.

In Maplebear, Instacart argued that “the People’s

UCL claims for restitution, employee reclassification,

37a

and an injunction requiring Instacart to comply with

the Labor Code are private in nature, and any benefits

to the public from that relief are merely incidental, and

therefore the claims are arbitrable.” (Id. at *9 (cleaned

up).) The court found that “the premise of this

argument is flawed because it is based on rules that

apply where the plaintiff entered an arbitration

agreement with the defendant and the relief sought is

private. The Broughton-Cruz rule—which precludes

arbitration of injunctive relief claims that benefit the

public and requires arbitration of claims seeking

restitution and injunctive relief which primarily

benefits the individual plaintiff—do[es] not apply here,

where there is no agreement between the parties to

arbitrate and the case is a law enforcement action

brought for public benefit.” (Id. (footnote omitted).

Finally, for the same fundamental reason, the court

rejected Instacart’s claim that the trial court’s order

must be reversed “because it creates a new exception to

the FAA for law enforcement actions,” characterizing

its framing of the issue as erroneous. “As discussed, the

FAA requires courts to enforce arbitration

agreements. The FAA does not require courts to expand

the contours of the agreement to compel non-parties,

here the government, to arbitration.” (Id. at *9.)

Even more recently, in Department of Fair

Employment and Housing v. Cisco Systems, Inc. (Aug.

5, 2022) 2022 WL 3136003, the Sixth District Court of

Appeal reached precisely the same result, holding that

the Department of Fair Employment and Housing

cannot be compelled to arbitrate an employment

discrimination lawsuit when the affected employee

agreed to resolve disputes with the employer through

arbitration because the Department did not agree to do

so. Just as in Maplebear, the court emphasized that

“[a]s the public arm of the enforcement procedure, the

38a

Department acts independently when it sues for FEHA

violations.” (Id. at *3 (footnote omitted).) “The ability

to decide whether to file an action and the ability to

pursue relief separate from what can be obtained by an

employee confirm that the Department operates as an

independent party in an enforcement lawsuit,” not

merely as the employee’s “proxy.” (Id., citing Waffle

House, 534 U.S. at 291.) Even if the employee is a “real

party in interest” because the Department seeks at

least some remedies for the employee, “it does not

undermine or conflict with the Department having an

independent interest in FEHA enforcement.” (Id.) In

short,

The Department acts independently when it

exercises the power to sue for FEHA violations. As

an independent party, the Department cannot be

compelled to arbitrate under an agreement it has

not entered.

(Id. at *5.) The court also noted that its reasoning was

consistent with decisions by the Ninth Circuit Court of

Appeals and other states declining to require

administrative enforcement agencies to arbitrate

without their consent. (Id.; see also Crestwood

Behaviorial Health, Inc. v. Lacy (2021) 70 Cal.App.5th

560, 581-585 [recognizing, following Waffle House, that

Labor Commissioner has independent statutory

authority to investigate and obtain victim-specific

relief under the Labor Code and to protect the public

interest, regardless of whether the individual

employee’s claim has been compelled to arbitration].)

These cases constitute binding precedent and are

dispositive of Defendants’ motions. 4 Here, precisely as

Uber’s reliance on a decision by another department of this

Court in People v. Doordash, Inc., No. CGC-20-584789, is

improper. Trial court orders have no precedential value. (Bolanos

39a

in these cases, it is undisputed that the People and the

Commissioner are not parties to Defendants’ private

arbitration agreements with their drivers. Further,

both the People and the Commissioner have

independent statutory authority to file suit to enforce

the UCL and the Labor Code, which furthers the public

interests in those statutory schemes. It follows that

they may not be compelled to arbitrate their claims

under agreements they did not enter, regardless of

whether they are seeking relief that will redound to the

drivers’ benefit.

Defendants criticize these cases as incorrectly

decided, although they correctly recognize they are

binding on this Court. Their efforts to distinguish or

avoid them are unpersuasive. Only one warrants brief

discussion here.

Defendants argue that arbitration is compelled by

the FAA and Viking River. But both Maplebear and

DFEH squarely rejected that argument. After the

Court of Appeal issued its original opinion in

Maplebear, it granted rehearing and vacated that

opinion to consider Viking River. After doing so,

however, it reissued its original opinion essentially

unchanged, adding a footnote explaining that

“[b]ecause this case does not concern PAGA claims and

because the City of San Diego is not a party to

Instacart’s arbitration agreement with its Shoppers,

Viking River has no impact on this appeal.” (81

v. Superior Court (2008) 169 Cal.App.4th 744, 761.) In any event,

that ruling addressed a different issue: whether the People were

barred by res judicata from seeking restitution under the UCL

on behalf of drivers who had entered into a class action

settlement releasing the same claims. It did not involve a motion

to compel arbitration, nor did it hold that the People may be

bound by private arbitration agreements to which they are not

parties.

40a

Cal.App.5th *6 at fn. 4.) Similarly, the DFEH court

made clear that Viking River “reaffirmed, consistent

with what we say here, that arbitration is a matter of

consent and a party cannot be compelled to arbitrate

absent a contractual basis for concluding the party

agreed to do so.” (2022 WL 3136003, at *4; see Viking

River, 142 S.Ct. at 1923 [“The most basic corollary of the

principle that arbitration is a matter of consent is that

a party can be forced to arbitrate only those issues it

specifically has agreed to submit to arbitration. This

means that parties cannot be coerced into arbitrating a

claim, issue, or dispute absent an affirmative

contractual basis for concluding that the party agreed

to do so.” (cleaned up; emphasis original)].) The same

conclusion follows inescapably here.

Finally, Defendants make the alternative argument

that the People and the Labor Commissioner may be

required to arbitrate their restitution claims under the

equitable estoppel doctrine. “Generally speaking, one

must be a party to an arbitration agreement to be

bound by it or invoke it. The strong public policy in

favor of arbitration does not extend to those who are

not parties to an arbitration agreement, and a party

cannot be compelled to arbitrate a dispute that he has

not agreed to resolve by arbitration.” (Westra v. Marcus

& Millichap Real Estate Investment Brokerage Co., Inc.

(2005) 129 Cal.App.4th 759,763 (cleaned up).)

“However, both California and federal courts have

recognized limited exceptions to this rule, allowing

nonsignatories to an agreement containing an

arbitration clause to compel arbitration of, or be

compelled to arbitrate, a dispute arising within the

scope of that agreement.” (DMS Services, LLC v.

Superior Court (2012) 205 Cal.App.4th 1346,13521353.)

Under

the

equitable

estoppel

doctrine,

41a

summarized

Defendants’

authorities,

“a

nonsignatory defendant may invoke an arbitration

clause to compel a signatory plaintiff to arbitrate its

claims when the cause of action against the

nonsignatory are intimately founded in and

intertwined with the underlying contract obligations.”

(Alliance Title Co., Inc. v. Boucher (2005) 127

Cal.App.4th 262, 271 (cleaned up); see also, e.g., JSM

Tuscany, LLC v. Superior Court (193 Cal.App.4th

1222, 1237 [same].) The instant motions present the

obverse situation: Defendants, who are signatories of

the arbitration agreements with their drivers, are

seeking to compel the People and the Labor

Commissioner, nonsignatory strangers to those

agreements, to arbitrate their claims. (See, e.g., Jensen

v. U-Haul Co. of California (2017) 18 Cal.App.5th 295,

307 [criticizing moving defendant for conflating “two

separate and distinct issues” of whether a signatory

plaintiff’s claims sufficiently relate to or arise from a

contract as to fall within the scope of the arbitration

clause and “whether a nonsignatory plaintiff’s claims

are so dependent on and inextricably intertwined with

the underlying contractual obligations of the

agreement containing the arbitration clause that

equity requires those claims to be arbitrated”].) For at

least two reasons, even if the doctrine could properly

be applied against a nonsignatory under certain

narrow circumstances, this is not such a case.

First, as the People and the Labor Commissioner

correctly observe, their claims under the UCL and the

Labor Code are not founded in Defendants’ contracts

with their drivers. “The reason for this equitable rule

is plain: One should not be permitted to rely on an

agreement containing an arbitration clause for its

claims, while at the same time repudiating the

arbitration provision contained in the same contract.”

(DMS Services, LLC, 205 Cal.App.4th at 1354.)

42a

Merely “making reference to” an agreement with an

arbitration clause is not enough. (Goldman v. KPMG,

LLP (2009) 173 Cal.App.4th 209, 218.) Here, the

People and the Labor Commissioner are “only seeking

to enforce the UCL” and the Labor Code, and are

“clearly not seeking to enforce or otherwise take

advantage of any portion” of Defendants’ contracts

with their drivers”; indeed, they take the position that

those contracts violate California law requiring

Defendants to classify their drivers as employees.

(UFCW & Employers Benefit Trust v. Sutter Health

(2015) 241 Cal.App.4th 909, 929.) “The doctrine of

equitable estoppel has no application.” (Id; see also

Stafford v. Rite Aid Corporation (9th Cir. 2020) 998

F.3d 862, 866-867 [equitable estoppel did not require

pharmacy customer who filed putative class action

under UCL and CLRA alleging that pharmacy

fraudulently inflated reported prices of prescription

drugs to insurance companies to submit claims to

arbitration under pharmacy’s contracts with

pharmacy benefits managers, where plaintiff was not

seeking damages for breach of those contracts];

Namisnak v. Uber Technologies, Inc. (9th Cir. 2020)

971 F.3d 1088, 1095 [plaintiffs’ claims under the ADA

were fully viable without reference to Uber’s Terms

and Conditions, which contained arbitration clause, so

equitable estoppel did not apply]; Jensen, 18

Cal.App.5th at 295 [affirming denial of motion to

compel arbitration where “plaintiffs do not rely or

depend on the terms of the rental agreement . . . in

asserting their claims,” which are “fully viable”

without reference to the terms of that agreement].)

Second, it is long been the law in California that

“neither the doctrine of estoppel nor any other

equitable principle may be invoked against a

governmental body where it would operate to defeat the

effective operation of a policy adopted to protect the

43a

public.” (Kajima/Ray Wilson v. Los Angeles County

Metropolitan Transp. Authority (2000) 23 Cal.4th 305,

316, quoting San Diego County v. California Water &

Tel. Co. (1947) 30 Cal.2d 817, 826.) Here, applying the

doctrine of equitable estoppel to preclude the People

and the Labor Commissioner from litigating their

unfair business practice and Labor Code claims would

nullify the important public policies underlying the

UCL and the Labor Code, and would effectively negate

the controlling body of authority discussed above.

CONCLUSION

For the foregoing reasons, Defendants’ motions to

compel arbitration and to stay as to the People’s and the

Labor Commissioner’s cases, and their alternative

motions to strike, are denied.

IT IS SO ORDERED.

[Signature]

Ethan P. Schulman

Judge of the Superior

Court

Dated: September 1, 2022

44a

APPENDIX C

No. S282614

IN THE SUPREME COURT OF CALIFORNIA

In re UBER TECHNOLOGIES WAGE AND HOUR

CASES.

(Ct. of Appeal, First Appellate District, Division Four

– No. A166355)

[Filed January 17, 2024]

En Banc

The petitions for review are denied.

Evans, J., was recused and did not participate.

Guerrero

Chief Justice

45a

APPENDIX D

1. United States Constitution, Article IV states:

All Debts contracted and Engagements entered into,

before the Adoption of this Constitution, shall be as

valid against the United States under this

Constitution, as under the Confederation.

This Constitution, and the Laws of the United States

which shall be made in Pursuance thereof; and all

Treaties made, or which shall be made, under the

Authority of the United States, shall be the supreme

Law of the Land; and the Judges in every State shall

be bound thereby, any Thing in the Constitution or

Laws of any State to the Contrary notwithstanding.

The Senators and Representatives before mentioned,

and the Members of the several State Legislatures,

and all executive and judicial Officers, both of the

United States and of the several States, shall be bound

by Oath or Affirmation, to support this Constitution;

but no religious Test shall ever be required as a

Qualification to any Office or public Trust under the

United States.

2. 9 U.S.C. § 2 states:

A written provision in any maritime transaction or a

contract evidencing a transaction involving commerce

to settle by arbitration a controversy thereafter arising

out of such contract or transaction, or the refusal to

perform the whole or any part thereof, or an agreement

in writing to submit to arbitration an existing

controversy arising out of such a contract, transaction,

or refusal, shall be valid, irrevocable, and enforceable,

save upon such grounds as exist at law or in equity for

the revocation of any contract or as otherwise provided

in chapter 4.

46a

APPENDIX E

SUPERIOR COURT OF THE STATE OF

CALIFORNIA

COUNTY OF ALAMEDA

LILIA GARCIA-BROWER, in her official capacity as

Labor Commissioner for the State of California,

Plaintiff,

LYFT, INC.; DOES 1-20, inclusive, Defendants.

FIRST AMENDED COMPLAINT FOR INJUNCTIVE

RELIEF, DAMAGES AND PENALTIES FOR (1)

WILLFUL MISCLASSIFICATION OF EMPLOYEES

AS INDEPENDENT CONTRACTORS, (2) FAILURE

TO PAY MINIMUM WAGE, (3) FAILURE TO PAY

OVERTIME WAGES, (4) FAILURE TO PAY WAGES

FOR REST PERIODS, (5) FAILURE TO PAY REST

PERIOD PREMIUM PAY, (6) FAILURE TO

INDEMNIFY EMPLOYEES FOR BUSINESS

EXPENSES, (7) FAILURE TO PROVIDE ITEMIZED

WAGE STATEMENTS, (8) FAILURE TO COMPLY

WITH PAID SICK LEAVE REQUIREMENTS, (9)

FAILURE TO TIMELY PAY EARNED WAGES

UPON SEPARATION FROM EMPLOYMENT, (10)

FAILURE TO TIMELY PAY EARNED WAGES

DURING EMPLOYMENT, (11) FAILURE TO

PROVIDE NOTICE OF EMPLOYMENT

INFORMATION

(No fee per Labor Code §§ 101, 101.5 and

Government Code § 6103)

VERIFIED ANSWER REQUIRED PURSUANT TO

CCP § 446

[FILED November 18, 2020]

Plaintiff, LILIA GARCIA-BROWER, in her official

47a

capacity as Labor Commissioner for the State of

California, alleges as follows:

THE PARTIES TO THIS ACTION

Plaintiff is the Labor Commissioner for the

State of California, and Chief of the Division of Labor

Standards Enforcement (“DLSE” or “Plaintiff”) of the

Department of Industrial Relations for the State of

California. (Labor Code §§ 21, 79.)

Plaintiff is authorized to enforce all provisions

of the Labor Code and Industrial Welfare Commission

(“IWC”) orders governing wages, hours and working

conditions of California employees. (Labor Code §§ 61,

90.5(b), and 95(a)). It is the policy of the State of

California to “vigorously enforce minimum labor

standards in order to ensure employees are not

required or permitted to work under substandard

unlawful conditions or for employers that have not

secured the payment of compensation, and to protect

employers who comply with the law from those who

attempt to gain a competitive advantage at the

expense of their workers by failing to comply with

minimum labor standards.” (Labor Code § 90.5.)

As part of her enforcement powers, Plaintiff is

authorized, pursuant to Labor Code § 98.3(b), to

prosecute actions for the collection of wages and other

moneys payable to employees or to the State arising

out of an employment relationship or order of the IWC.

Labor Code § 217 expressly empowers the Labor

Commissioner to enforce the provisions of Labor Code

§§ 200-244, which include the Code section requiring

payment of premium pay for failure to comply with

IWC wage order meal and rest period requirements,

and Code sections authorizing penalties for an

employer’s failure to timely pay wages due to

employees during employment or upon separation of

48a

employment, or for an employer’s failure to comply

with requirements pertaining to itemized wage

statements. Plaintiff is expressly authorized, pursuant

to Labor Code § 226.8, to enforce that Code section

which prohibits the willful misclassification of

employees as independent contractors. Labor Code

§ 248.5 expressly authorizes the Labor Commissioner

to enforce the paid sick leave requirements set out in

Labor Code §§ 245-249. Labor Code § 1193.6 expressly

authorizes the Labor Commissioner to file and

prosecute a civil action to recover unpaid minimum

wages or unpaid overtime compensation, owed to any

employee under Labor Code §§ 1171-1206 or under

any IWC order. Furthermore, Plaintiff is authorized,

pursuant to Labor Code § 1194.5, to seek injunctive

relief to prevent further violations of any of the laws,

regulations or IWC orders governing wages, hours of

work, and working conditions for employees. Labor

Code § 2802 expressly empowers the Labor

Commissioner to file a court action to recover amounts

due under that section, which requires employers to

indemnify employees for business expenses.

At all relevant times herein, Defendant Lyft,

Inc. (hereinafter “Lyft”) has been registered with the

Secretary of State as a Delaware corporation, engaged

in the business of transportation as a ride hailing

service, with its principal business office located in the

City and County of San Francisco. Lyft provides ondemand transportation services throughout all

counties in California. Lyft makes use of an ondemand

transportation

mobile

application

(hereinafter “app”) to engage the services of its drivers,

to receive orders from customer passengers, to assign

and schedule its drivers to provide transportation

services to those customer passengers, to collect the

amounts owed by those customers (based on prices set

49a

by defendants) for those transportation services, and

to pay its drivers for the services they provided to these

customer passengers. The work performed by these

drivers – driving – constitutes the very core of Lyft’s

business. Moreover, Lyft retains and/or exercises

substantial control over its drivers, with restrictions

on when, where and how the work may be performed.

The true names or capacities of defendants

sued as Doe Defendants 1 through 20 are unknown to

Plaintiff. Plaintiff is informed and believes, and on

that basis, alleges that each of the Doe Defendants,

their agents, employees, officers, and others acting on

their behalf, are legally responsible for the conduct

alleged herein. Plaintiff will amend her complaint to

set forth the true names and capacities of the Doe

Defendants and the allegations against them as soon

as they are ascertained.

Each of the defendants was at all times

mentioned herein an agent, partner, joint venturer,

and/or representative of each of the other defendants

and was at all times acting within the scope of such

relationship

JURISDICTION AND VENUE

The Superior Court has personal jurisdiction

over each defendant named above because (1) each

defendant is headquartered in or is a resident of the

State of California, (2) each defendant is authorized to

and conducts business in and across the State of

California, and (3) each defendant otherwise has

sufficient minimum contacts with and purposefully

avails itself of the markets of this State, thus

rendering the Superior Court’s jurisdiction consistent

with traditional notions of fair play and substantial

justice. Lyft has its principal place of business at 185

Berry Street, Ste. 5000, San Francisco, CA 94107.

50a

Venue is proper under Code of Civil Procedure

§ 395.5, because Lyft operates in and thousands of the

illegal acts described below occurred in the County of

Alameda.

BACKGROUND ALLEGATIONS

Lyft is a company that sells rides. As stated in

its U.S. Securities and Exchange Commission Form S1 Registration Statement, filed in March 2019, Lyft’s

mission is to “Improve people’s lives with the world’s

best transportation.” From its start-up in 2012, Lyft

made a calculated business decision to misclassify its

drivers as independent contractors rather than

employees. At all times since the inception of Lyft’s

business, defendants have continued to misclassify

their drivers as a means of unlawfully depriving these

workers of a host of statutory protections applicable to

employees, in direct contravention of California law.

10. To provide the hundreds of thousands of

drivers needed to support the business model, Lyft

solicits and employs a massive workforce of over

100,000 drivers throughout California for the purpose

of transporting Lyft’s customers. This driver workforce

performs the service for which customers pay Lyft—

transportation.

11. Lyft has been classified by the California

Public Utilities Commission (CPUC) as a

transportation network company (TNC). The CPUC

defines a TNC as “a company or organization

operating in California that provides transportation

services using an online-enabled platform to connect

passengers with drivers using their personal vehicles.”

The CPUC has also classified Lyft as a charter-party

carrier

(TCP),

which

includes

passenger

transportation. The CPUC has authorized Lyft to

provide services for “the transportation of persons by

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motor vehicle for compensation, whether in common or

contract carriage, over any public highway in this

state.” (Pub. Util. Code § 5360.) The transportation of

passengers for compensation within California

requires operating authority from the CPUC, unless

limited exemptions apply—such as taxicab service

(which is subject to local city and county regulation)

and medical transportation vehicles. (Public Utilities

Code §§ 226 and 5353.)

12. On June 9, 2020, the CPUC issued a Scoping

Memo and Ruling in Rulemaking 12- 12-001 and

stated that, based upon the enactment of AB 5 (Labor

Code § 2750.5, codification of the “ABC” test), “for now,

TNC drivers are presumed to be employees…” The

CPUC’s public comment period on the AB 5 question

closed on August 7, 2020.

13. Through this misclassification, Lyft has

engaged in a deliberate scheme to evade its obligations

under California law – including, but not limited to the

obligation to pay its drivers no less than the applicable

minimum wage for all hours worked, to pay overtime

compensation for overtime hours worked, to provide

paid, duty-free rest periods during the workday, to

reimburse the drivers for the cost of all equipment and

supplies needed to perform their work and for workrelated personal vehicle mileage, to provide paid sick

leave, to provide accurate itemized wage deduction

statements and other required notices containing

required employment-related information, and to

timely pay all wages owed during each driver’s period

of employment and upon separation of employment.

14. Lyft’s unlawful business model, premised

upon misclassification of employees as independent

contractors, is built upon the misconception that

employees can be designated as independent

contractors and deprived of the benefits and security

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of the employment relationship if certain words are

used to misclassify the relationship in a contract

between the worker and the hiring entity.

15. In an opinion piece in the San Francisco

Chronicle titled “Open Forum: Uber, Lyft ready to do

our part for drivers” dated June 12, 2019, Lyft

acknowledged its drivers face serious concerns because

of their misclassification as independent contractors

and not employees, including “earnings stability [and]

protections on the job…” Lyft, however, decried the

possibility of properly classifying its drivers as

employees, claiming that “a change to the employment

classification of ride-share drivers would pose a risk to

our business.”

16. Recognizing

the

serious

problem

misclassification and the harms it inflicts on workers,

law-abiding businesses, taxpayers, and society as a

whole, the California Legislature enacted Assembly

Bill 5, which took effect on January 1, 2020. (Assem.

Bill No. 5, 2019-2020 Reg. Sess. (“A.B. 5”).) A.B. 5

codified and extended the California Supreme Court’s

unanimous decision in Dynamex Operations W., Inc.

v. Superior Court (2018) 4 Cal.4th 903 (“Dynamex”).

California law is clear: for the full range of protections

afforded by the Industrial Welfare Commission

(“IWC”) wage orders, the Labor Code, and the

Unemployment Insurance Code, workers are generally

presumed to be employees unless the hiring entity can

overcome this presumption by establishing each of the

three factors in the strict “ABC” test: (A) the worker is

free from the control and direction of the hiring entity

in connection with the performance of the work, both

under the contract for the performance of the work and

in fact; (B) the worker performs work that is outside

the usual course of the hiring entity’s business; and (C)

the worker is customarily engaged in an

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independently established trade, occupation or

business of the same nature as the work performed.

(Lab. Code § 2

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