Amicus Curiae Brief — Uber Technologies, Inc., et al., Petitioners v. Johnathon Gregg

No. 23-645

In the

Supreme Court of the United States

UBER TECHNOLOGIES, INC., ET AL.,

Petitioner,

v.

JOHNATHON GREGG,

Respondent.

On Petition for Writ of Certiorari to the

Supreme Court of California

BRIEF OF THE CIVIL JUSTICE ASSOCIATION

OF CALIFORNIA AS AMICUS CURIAE

SUPPORTING PETITIONER

CALVIN HOUSE

Counsel of Record

GUTIERREZ, PRECIADO & HOUSE, LLP

3020 E. Colorado Boulevard

Pasadena, CA 91107

(626) 449-2300

calvin.house@gphlawyers.com

Counsel for Amicus Curiae

January 15, 2024

Becker Gallagher · Cincinnati, OH · Washington, D.C. · 800.890.5001

i

TABLE OF CONTENTS

INTEREST OF AMICUS CURIAE .............................1

SUMMARY OF THE ARGUMENT ............................2

ARGUMENT ................................................................3

CONCLUSION ............................................................5

ii

Cases

TABLE OF AUTHORITIES

Adolph v. Uber Technologies, Inc.,

532 P.3d 682 (2023) ................................................. 2

AT&T Mobility LLC v. Concepcion,

563 U.S. 333 (2011).............................................. 5, 6

DIRECTV, Inc. v. Imburgia,

577 U.S. 47 (2015).................................................... 6

Iskanian v. CLS Transportation Los Angeles,

LLC, 327 P.3d 129 (Cal. 2014) ........................ 3, 4, 5

Lamps Plus, Inc. v. Varela,

139 S.Ct. 1407 (2019)............................................... 3

Moses H. Cone Mem'l Hosp. v. Mercury Constr.

Corp., 460 U.S. 1 (1983)........................................... 3

Perry v. Thomas,

482 U.S. 483 (1987).................................................. 3

Preston v. Ferrer,

552 U.S. 346 (2008).................................................. 5

Southland Corp. v. Keating,

465 U.S. 1 (1984)...................................................... 5

Viking River Cruises, Inc. v. Moriana,

142 S.Ct. 1906 (2022)....................................... 2, 4, 6

Statutes

Cal. Lab. Code § 2699(g).............................................. 3

1

INTEREST OF AMICUS CURIAE 1

The Civil Justice Association of California

(“CJAC”) is a nonprofit organization whose members

are businesses from a broad cross section of industries.

CJAC’s principal purpose is to educate the public and

its governing bodies about how to make laws

determining who gets paid, how much, and by whom

when the conduct of some causes harm to others –

more fair, certain, and economical. Toward this end,

CJAC regularly appears as amicus curiae in numerous

cases of interest to its members, including those that

concern the scope and application of the Federal

Arbitration Act (“FAA”).

CJAC’s members collectively employ many

thousands of people in California and hundreds of

thousands nationally to provide various products and

services. Most of CJAC’s members have elected, as

have many employers throughout the country, to

resolve disputes with their employees over

employment matters through binding arbitration.

CJAC supports the FAA’s protective umbrella for

voluntary, binding arbitration and believes that

arbitration is preferable to litigation for maintenance

of a viable economy.

The current state of the law regarding the

enforcement of agreements to arbitrate that implicate

claims under California’s Labor Code Private

1 Counsel of record for the parties received timely notice

of the intent to file this brief. No counsel for any party in this case

authored this brief in whole or in part. No person or entity aside

from amicus made a monetary contribution to the preparation or

submission of this brief.

2

Attorneys General Act of 2004 (PAGA) is uncertain. As

businesses with thousands of employees in California,

CJAC’s members are concerned that the arbitration

agreements they have with their employees will be

subject to differing enforcement standards by the

lower courts until this Court grants review to provide

the clarity and certainty on this issue that is needed

to assure uniformity of decision.

SUMMARY OF THE ARGUMENT

In Viking River Cruises, Inc. v. Moriana, 142

S.Ct. 1906, 1912 (2022), this Court ruled that

California’s prohibition on contractual division of

PAGA claims into individual and representative

claims violated the Federal Arbitration Act (FAA)’s

fundamental principle that “arbitration is a matter of

consent.” Once an employee’s own claim for a

California Labor Code violation has been severed

away from her lawsuit and sent to arbitration, there

is no mechanism to allow a court to adjudicate the nonindividual PAGA claims (that is, those brought on

behalf of the Labor and Workforce Development

Agency for violations involving other employees).

According to the Court, because the employee whose

individual claim has been ordered to arbitration lacks

standing to maintain those claims, the correct course

was to dismiss that plaintiff’s remaining claims. Id. at

1925.

The California Court of Appeal in this case, and

the California Supreme Court in Adolph v. Uber

Technologies, Inc., 532 P.3d 682 (2023) disagree.

According to those decisions, California law permits

an employee whose individual PAGA claim has been

sent to arbitration to somehow remain in court and

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seek penalties and attorney’s fees from her employer

based on violations involving other employees.

This Court should grant review to make clear

that this new California rule interferes with the

freedom of the parties to an arbitration agreement to

determine without coercion “the issues subject to

arbitration” and “the rules by which they will

arbitrate.” Lamps Plus, Inc. v. Varela, 139 S.Ct. 1407,

1416 (2019).

ARGUMENT

The FAA “is a congressional declaration of a

liberal federal policy favoring arbitration agreements,

notwithstanding any state substantive or procedural

policies to the contrary.” Moses H. Cone Mem’l Hosp.

v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983). To

further that policy, “questions of arbitrability must be

addressed with a healthy regard for the federal policy

favoring arbitration.” Ibid. The FAA “embodies

Congress’ intent to provide for the enforcement of

arbitration agreements within the full reach of the

Commerce Clause.” Perry v. Thomas, 482 U.S. 483,

490 (1987)

PAGA authorizes any employee who claims to

have been a victim of a California Labor Code violation

to file an action as an agent of the State of California

to obtain civil penalties for all violations the employer

is alleged to have committed, including violations

involving other employees. Iskanian v. CLS

Transportation Los Angeles, LLC, 327 P.3d 129 (Cal.

2014). A prevailing plaintiff in such an action may also

recover attorney’s fees. Cal. Lab. Code § 2699(g). As

this Court has recognized, “[i]ndividually, these

4

penalties are modest; but given PAGA’s additive

dimension, low-value claims may easily be welded

together into high-value suits.” Viking River, 142 S.Ct.

at 1915.

In Viking River, this Court held that California

could not enforce a rule that compelled parties to an

arbitration agreement “to either go along with an

arbitration in which the range of issues under

consideration is determined by coercion rather than

consent, or else forgo arbitration altogether.” 142 S.Ct.

at 1924. The California rule at issue there had that

effect because it barred employees from splitting their

individual PAGA claims from the representative ones.

But the revised rule that the California courts

have now adopted to avoid the result directed in

Viking River would have the same effect. Although the

new rule would permit an employer to resolve an

employee’s individual PAGA claim in arbitration, the

stakes riding on the arbitration of that claim would be

just as high as they were before Viking River was

decided. If the employee wins the arbitration, the

employer will face hundreds of thousands, if not

millions, of dollars of penalties and attorney fees when

the employee pursues the representative claims in

court. That prospect is what led this Court to rule in

Viking River that the Iskanian rule was incompatible

with the FAA.

But as we have said, “[a]rbitration is

poorly suited to the higher stakes” of

massive-scale disputes of this kind.

Concepcion, 563 U.S. at 350. The absence

of “multilayered review” in arbitral

proceedings “makes it more likely that

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errors will go uncorrected.” Ibid. And

suits featuring a vast number of claims

entail the same “risk of ‘in terrorem’

settlements that class actions entail.”

Ibid. As a result, Iskanian’s indivisibility

rule effectively coerces parties to opt for

a judicial forum rather than “forgo[ing]

the procedural rigor and appellate review

of the courts in order to realize the

benefits of private dispute resolution.”

Stolt-Nielsen, 559 U.S. at 685; see also

Concepcion, 563 U.S. at 350-351. This

result is incompatible with the FAA.

Because California’s new rule for the treatment of

PAGA claims in an arbitration context is based on the

same hostility toward arbitration as the Iskanian rule,

the Court should grant certiorari to strike it down.

CONCLUSION

Because they employ thousands of employees in

California, CJAC’s members have a strong interest in

making sure that California courts adhere to the

principles of the FAA. As this Court is aware,

California courts have shown an inclination to evade

those principles. 2 The Court should grant certiorari to

2 See Southland Corp. v. Keating, 465 U.S. 1, 3 (1984)

(statute that purported to invalidate certain arbitration

agreements violated the Supremacy Clause); Perry v. Thomas,

supra (FAA preempted a provision that actions for collection of

wages could be maintained without regard to the existence of an

arbitration agreement); Preston v. Ferrer, 552 U.S. 346 (2008)

(statute requiring some wage and hour disputes to be determined

by a state administrative agency conflicted with the FAA); AT&T

6

overturn the rule that California courts have adopted

to try to get around this Court’s Viking River decision.

Respectfully submitted,

CALVIN HOUSE

Counsel of Record

GUTIERREZ, PRECIADO & HOUSE, LLP

3020 E. Colorado Boulevard

Pasadena, CA 91107

(626) 449-2300

calvin.house@gphlawyers.com

Counsel for Amicus Curiae

January 15, 2024

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

that a contractual arbitration provision was unconscionable

because it disallowed class wide proceedings); DIRECTV, Inc. v.

Imburgia, 577 U.S. 47, 54 (2015) (California courts could not use

a contractual choice of California law to overcome this Court’s

invalidation of a California rule that was hostile to arbitration).