CALIFORNIA CLASS ACTION LAW

California Court of Appeal Cites Death Knell Doctrine to Assert Jurisdiction Over Appeal of Order Granting Arbitration

Ring His Death Knell - NARA - 534312

Ring His Death Knell – NARA – 534312 (Photo credit: Wikipedia)

Yesterday, in a proposed wage and hour class action, the California Court of Appeal for the Second District reversed the lower court’s order granting a petition to compel arbitration.  Compton v. Superior Court of Los Angeles County, No. B236669, — Cal.Rptr.3d —-, 2013 WL 1120619 (2d Dist. Mar 19, 2013).  Plaintiff was a property manager who was required to sign an arbitration agreement that also barred arbitration of class claims.  The trial court granted defendants’ petition to compel arbitration.

Normally an order compelling arbitration is not appealable.  But the Court of Appeal determined it had jurisdiction, citing the “death knell” doctrine:

An order compelling arbitration is not appealable. (Elijahjuan v. Superior Court (2012) 210 Cal.App.4th 15, 19.) The parties argue over whether this matter is appealable under the “death knell” doctrine, which applies when an order effectively terminates a class action. Rather than parse the case law on that issue, we conclude that we have jurisdiction to treat this nonappealable order as a petition for writ of mandate in this unusual case because: (1) the unconscionability issue is one of law based on undisputed facts and has been fully briefed; (2) the record is sufficient to consider the issue and it appears that the trial court would be only a nominal party; (3) if we were to dismiss the appeal, and the ultimate reversal of the order is inevitable, it would come in a post-arbitration award after the substantial time and expense of arbitrating the dispute; and (4) as a result, dismissing the appeal would require the parties to arbitrate nonarbitrable claims and would be costly and dilatory.

The Court concluded that the arbitration agreement was unconscionably one-sided because (1) it exempted from arbitration claims the employer would more likely bring, such as claims for injunctive or equitable relief from trade secret disclosures; (2) it limited the time to demand arbitration to a period shorter than the relevant statutes of limitation; (3) it retained the statute of limitations period for itself  and (4) it suggested that the arbitrator had the discretion not to award mandatory attorney’s fees under the Labor Code.

The Court determined that it was not violating Concepcion by enforcing Armendariz’s bilaterality rule:

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Central District Grants Final Approval to Injunctive Relief Settlement in Qunol CoQ10 Liquid Labeling Litigation

DSC_9962

DSC_9962 (Photo credit: k_haruna)

On March 13, 2013, Judge David O. Carter granted final approval to a class action based on claims that Defendants mislabeled their “Qunol” product as “six times more effective” than other similar products.  Bruno v. Quten Research Institute, LLC, et al. (In re Qunol CoQ10 Liquid Labeling Litigation), No. SACV 11–00173 DOC (Ex), 2013 WL 990495 (C.D. Cal. March 13, 2013) (slip op.).

Class

All excluding officers, directors, and employees of Quten Research Institute, LLC or Tishcon Corp. and their immediate families, who on or after January 31, 2007 purchased Qunol CoQ10 in the United States for personal or household uses, rather than resale or distribution, in packaging stating that Qunol offers six times better absorption or effectiveness. Read the rest of this entry »