The U.S. Supreme Court's denial of certiorari in Iskanian v. CLS Transportation Los Angeles, LLC leaves intact (for now) the California Supreme Court's decision holding that neither Supreme Court precedent nor the Federal Arbitration Act (FAA) preempt an employee's right to bring a "representative" action under California's Private Attorneys General Act (PAGA), even where the right to do so is expressly waived by the employee and employer in an arbitration agreement governed by the FAA. Axiomatically, a denial of certiorari is not a ruling on the merits or affirmation of the underlying case. See Martin v. Blessing, 134 S.Ct. 402, 405 (2013) (stating the "denial of certiorari does not constitute an expression of any opinion on the merits"). Nor does the Supreme Court's certiorari denial signal the death knell for employers seeking to enforce arbitral PAGA claim waivers because Iskanian is not binding on federal courts on the federal preemption issue. As the U.S. District Court for the Southern District of California stated in Fardig v. Hobby Lobby Stores Inc, 2014 U.S. Dist. LEXIS 139359 (C.D. Cal. Aug. 11, 2014), federal preemption is a question of federal law, not state law. In addition to Fardig, since Iskanian was decided, several other California federal district courts have refused to follow Iskanian and enforced PAGA claim waivers in employment arbitration agreements. See Ortiz v. Hobby Lobby Stores, Inc. 2014 U.S. Dist. LEXIS 140552 (E.D. Cal. Sept. 30, 2014); Chico v. Hilton Worldwide, Inc. 2014 U.S. Dist. LEXIS 147752 (C.D. Cal. Oct. 7, 2014); Langston v. 20/20 Companies, Inc. 2014 U.S. Dist. LEXIS 151477(C.D. Cal. Oct. 17, 2014); Mill v. Kmart Corp., 2014 U.S. Dist. LEXIS 165666 (N.D. Cal. Nov. 26, 2014); Lucero v. Sears Holdings Management Corp. 2014 U.S. Dist. LEXIS 168782 (S.D. Cal. Dec. 2, 2014). Accordingly, for employers who are able to litigate the preemption issue in federal court there is growing precedent for enforcing PAGA claim waivers. Moreover, given the split between the state and federal courts on this issue (the Ninth Circuit has yet to address Iskanian), the Supreme Court may be asked to address this issue again in the future.
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