`
`No.
`
`
`
`
`
`IN THE
`pìéêÉãÉ=`çìêí=çÑ=íÜÉ=råáíÉÇ=pí~íÉë=
`_______________
`COMCAST CORPORATION, COMCAST CABLE
`COMMUNICATIONS, LLC,
`
`v.
`
`Petitioners,
`
`CHARLES TILLAGE, JOSEPH LOOMIS,
`Respondents.
`
`_______________
`On Petition for a Writ of Certiorari
`to the United States Court of Appeals
`for the Ninth Circuit
`_______________
`
`PETITION FOR A WRIT OF CERTIORARI
`_______________
`MARK A. PERRY
` Counsel of Record
`JOSHUA M. WESNESKI
`GIBSON, DUNN & CRUTCHER LLP
`1050 Connecticut Avenue, N.W.
`Washington, D.C. 20036
`(202) 955-8500
`MPerry@gibsondunn.com
`
`SEAMUS C. DUFFY
`AKIN GUMP STRAUSS HAUER
` & FELD LLP
`Two Commerce Square
`2001 Market Street, Suite 4100
`Philadelphia, PA 19103
`(215) 965-1212
`
`Counsel for Petitioners
`
`(Additional Counsel Listed on Inside Cover)
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`MICHAEL J. STORTZ
`AKIN GUMP STRAUSS HAUER
` & FELD LLP
`580 California Street,
` Suite 1500
`San Francisco, CA 94104
`(415) 765-9508
`
`
`Counsel for Petitioners
`
`
`
`
`
`
`
`
`
`QUESTIONS PRESENTED
`The Federal Arbitration Act makes written arbi-
`
`tration agreements “valid, irrevocable, and enforcea-
`ble,” although its “saving clause” permits the applica-
`tion of defenses that “exist at law or in equity for the
`revocation of any contract.” 9 U.S.C. § 2. But even a
`defense that falls within the saving clause is
`preempted by the Act if it interferes with fundamental
`attributes of arbitration, such as bilateralism. See
`Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612, 1623 (2018).
`In 2017, the California Supreme Court announced
`for the first time that provisions in predispute arbitra-
`tion agreements waiving the parties’ right to seek
`“public injunctive relief” in any forum are contrary to
`California public policy and unenforceable. See
`McGill v. Citibank, N.A., 393 P.3d 85 (Cal. 2017). This
`so-called “McGill rule” effectively precludes bilateral
`arbitration of consumer disputes in California. The
`questions presented are:
`1. Whether the McGill rule falls outside the FAA’s
`saving clause because it is not a ground that “exist[s]
`at law or in equity” for the “revocation” of any con-
`tract?
`2. Whether, even if the McGill rule falls within the
`FAA’s saving clause, it is otherwise preempted by the
`FAA because it interferes with fundamental attrib-
`utes of arbitration by negating the parties’ agreement
`to resolve their dispute bilaterally?
`
`
`
`
`
`
`
`
`
`
`
`ii
`
`PARTIES TO THE PROCEEDING AND
`RULE 29.6 STATEMENT
`All parties to the proceeding are set forth in the
`caption.
`Pursuant to this Court’s Rule 29.6, undersigned
`counsel state that petitioner Comcast Cable Commu-
`nications, LLC is an indirect subsidiary of petitioner
`Comcast Corporation, a publicly held corporation.
`Comcast Corporation has no parent corporation and
`no publicly held corporation owns 10% or more of its
`stock.
`
`
`
`
`
`
`
`iii
`
`RULE 14.1(b)(iii) STATEMENT
`Pursuant to this Court’s Rule 14.1(b)(iii), the fol-
`lowing proceedings are related to this case:
` Tillage et al. v. Comcast Corp. et al., No. 3:17-
`cv-06477-VC-DMR (JCS) (N.D. Cal.).
` Tillage et al. v. Comcast Corp. et al., No. 18-
`15288 (9th Cir.) (judgment entered June 28,
`2019, petition for rehearing denied January
`17, 2020).
`There are no additional proceedings in any court
`that are directly related to this case.
`
`
`
`
`
`
`iv
`
`TABLE OF CONTENTS
`
`Page
`TABLE OF AUTHORITIES .................................... vi
`OPINIONS BELOW ................................................. 1
`JURISDICTION ....................................................... 1
`CONSTITUTIONAL AND STATUTORY
`PROVISIONS INVOLVED ...................................... 1
`STATEMENT ........................................................... 2
`REASONS FOR GRANTING THE PETITION .... 11
`I. THE MCGILL RULE FALLS OUTSIDE THE FAA’S
`SAVING CLAUSE ................................................. 13
`A. The McGill Rule Is Not A Defense
`Providing For Revocation Of Contracts .. 13
`B. Review Is Warranted To Protect
`Consumer Arbitration In California........ 22
`II. THE MCGILL RULE UNDERMINES THE FAA’S
`PROTECTION OF BILATERAL ARBITRATION ........ 27
`A. The Decision Below Interferes With
`Bilateral Arbitration ................................ 27
`B. Review Is Warranted To Correct The
`McGill Rule’s Intrusion On
`Bilateralism .............................................. 32
`CONCLUSION ....................................................... 34
`
`
`
`
`
` v
`
`
`
`TABLE OF APPENDICES
`
`Page
`
`APPENDIX A: Memorandum Disposition of
`the U.S. Court of Appeals for the Ninth
`Circuit (June 28, 2019) ...................................... 1a
`
`APPENDIX B: Opinion of the U.S. Court of
`Appeals for the Ninth Circuit in Blair v.
`Rent-A-Center, Inc. (June 28, 2019) .................. 3a
`
`APPENDIX C: Order of the U.S. District
`Court for the Northern District of Califor-
`nia Denying Motion to Compel Arbitration
`(Feb. 15, 2018) .................................................. 29a
`
`APPENDIX D: Order of the U.S. Court of Ap-
`peals for the Ninth Circuit Denying Peti-
`tion for Panel Rehearing and Rehearing
`En Banc (Jan. 17, 2020) ................................... 33a
`
`APPENDIX E: Constitutional and Statutory
`Provisions Involved .......................................... 34a
`
`U.S. Const. art. VI, cl. 2 .................................... 34a
`
`9 U.S.C. § 2 ........................................................ 34a
`
`9 U.S.C. § 4 ........................................................ 35a
`
`APPENDIX F: Excerpts from 2017 Subscriber
`Agreement ........................................................ 37a
`
`
`
`
`
`
`
`vi
`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Cases
`
`Allied-Bruce Terminix Cos. v. Dobson,
`513 U.S. 265 (1995) ........................................ 18, 24
`
`Am. Express Co. v. Italian Colors Rest.,
`570 U.S. 228 (2013) .................................... 5, 27, 29
`
`AT&T Mobility LLC v. Concepcion,
`563 U.S. 333 (2011) ...... 2, 3, 4, 5, 14, 22, 23, 24, 28
` ............................................................ 30, 31, 32, 33
`
`Bernhardt v. Polygraphic Co. of Am.,
`350 U.S. 198 (1956) ................................................ 2
`
`Bishay v. Icon Aircraft, Inc.,
`No. 19-CV-178, 2019 WL 3337885
`(E.D. Cal. July 25, 2019) ...................................... 30
`
`Broadley v. Mashpee Neck Marina, Inc.,
`471 F.3d 272 (1st Cir. 2006) ................................ 16
`
`Broughton v. Cigna Healthplans,
`988 P.2d 67 (Cal. 1999) ........................................ 33
`
`Cel-Tech Commc’ns, Inc. v. L.A. Cellular
`Tel. Co.,
`973 P.2d 527 (Cal. 1999) ...................................... 23
`
`Dean Witter Reynolds, Inc. v. Byrd,
`470 U.S. 213 (1985) .................................... 2, 24, 25
`
`
`
`
`
`vii
`
`DIRECTV, Inc. v. Imburgia,
`136 S. Ct. 463 (2015) ............................................ 24
`
`Discover Bank v. Superior Court,
`113 P.3d 1100 (Cal. 2005) ...................................... 5
`
`Doctor’s Assocs. v. Casarotto,
`517 U.S. 681 (1996) .................................... 4, 17, 20
`
`Duncan v. Walker,
`533 U.S. 167 (2001) .............................................. 17
`
`Epic Sys. Corp. v. Lewis,
`138 S. Ct. 1612 (2018) ................ 2, 6, 22, 28, 29, 31
`
`Ferguson v. Corinthian Colls., Inc.,
`733 F.3d 928 (9th Cir. 2013) ................................ 33
`
`Fernandez v. Bridgecrest Credit Co.,
`No. 19-CV-877, 2019 WL 7842449
`(C.D. Cal. Oct. 29, 2019) ...................................... 32
`
`First Hartford Corp. Pension Plan & Tr.
`v. United States,
`194 F.3d 1279 (Fed. Cir. 1999) ............................ 15
`
`Gozlon-Peretz v. United States,
`498 U.S. 395 (1991) .............................................. 15
`
`Halcon Int’l, Inc. v. Monsanto Austl.
`Ltd.,
`446 F.2d 156 (7th Cir. 1971) .................... 15, 25, 26
`
`Hardt v. Reliance Standard Life Ins.
`Co.,
`560 U.S. 242 (2010) .............................................. 14
`
`
`
`
`
`viii
`
`Huffman v. Saul Holdings Ltd. P’ship,
`194 F.3d 1072 (10th Cir. 1999) ............................ 15
`
`Hurd v. Hodge,
`334 U.S. 24 (1948) ................................................ 16
`
`Ins. Co. v. Morse,
`87 U.S. (20 Wall.) 445 (1874) ............................... 19
`
`Johnson Controls, Inc. v. City of Cedar
`Rapids,
`713 F.2d 370 (8th Cir. 1983) ................................ 19
`
`Kill v. Hollister
`(1746) 95 Eng. Rep. 532 (KB) .............................. 18
`
`Kindred Nursing Ctrs. Ltd. P’ship v.
`Clark,
`137 S. Ct. 1421 (2017) .......................... 4, 28, 29, 30
`
`Kulukundis Shipping Co., S/A v.
`Amtorg Trading Corp.,
`126 F.2d 978 (2d Cir. 1942) ................................. 18
`
`Lamie v. U.S. Tr.,
`540 U.S. 526 (2004) .............................................. 15
`
`Long Beach Drug Co. v. United Drug
`Co.,
`88 P.2d 698 (Cal. 1939) ........................................ 16
`
`Lyons v. NBCUniversal Media, LLC,
`No. 19-CV-3830, 2019 WL 6703396
`(C.D. Cal. Sept. 27, 2019) .................................... 32
`
`
`
`
`
`ix
`
`McArdle v. AT&T Mobility LLC,
`772 F. App’x 575 (9th Cir. 2019) ......................... 10
`
`McGill v. Citibank, N.A.,
`393 P.3d 85 (Cal. 2017) .......... 2, 6, 7, 20, 22, 30, 32
`
`Mellouli v. Lynch,
`135 S. Ct. 1980 (2015) .......................................... 17
`
`Middlesex County v. Gevyn Construction
`Corp.,
`450 F.2d 53 (1st Cir. 1971) .................................. 25
`
`Mitsubishi Motors Corp. v. Soler
`Chrysler-Plymouth, Inc.,
`473 U.S. 614 (1985) .............................................. 26
`
`Moses H. Cone Mem’l Hosp. v. Mercury
`Constr. Corp.,
`460 U.S. 1 (1983) .................................................... 3
`
`Nat’l R.R. Passenger Corp. v. Consol.
`Rail Corp.,
`892 F.2d 1066 (D.C. Cir. 1990) ............................ 26
`
`Neder v. United States,
`527 U.S. 1 (1999) .................................................. 15
`
`Olosoni v. HRB Tax Grp., Inc.,
`No. 19-CV-3610, 2019 WL 7576680
`(N.D. Cal. Nov. 5, 2019) ....................................... 32
`
`Perry v. Thomas,
`482 U.S. 483 (1987) .......................................... 3, 24
`
`
`
`
`
`x
`
`
`Preston v. Ferrer,
`552 U.S. 346 (2008) ................................................ 3
`
`Prima Paint Corp. v. Flood & Conklin
`Mfg. Co.,
`388 U.S. 395 (1967) .............................................. 18
`
`Rent-A-Center, W., Inc. v. Jackson,
`561 U.S. 63 (2010) .................................................. 3
`
`Sakkab v. Luxottica Retail North
`America, Inc.,
`803 F.3d 425 (9th Cir. 2015) ...................... 9, 31, 33
`
`Shearson/American Express, Inc. v.
`McMahon,
`482 U.S. 220 (1987) .............................................. 25
`
`Southland Corp. v. Keating,
`465 U.S. 1 (1984) .................................................... 4
`
`Stolt-Nielsen S.A. v. AnimalFeeds Int’l
`Corp.,
`559 U.S. 662 (2010) ........................................ 18, 27
`
`Supak & Sons Mfg. Co. v. Pervel Indus.,
`Inc.,
`593 F.2d 135 (4th Cir. 1979) ................................ 26
`
`Volt Info. Scis., Inc. v. Bd. of Trs. of
`Leland Stanford Junior Univ.,
`489 U.S. 468 (1989) ........................................ 18, 27
`
`Wilko v. Swan,
`346 U.S. 427 (1953) .............................................. 30
`
`
`
`
`
`xi
`
`
`Statutes
`
`9 U.S.C. § 2 ........................................ 2, 3, 4, 13, 14, 17
`
`9 U.S.C. § 4 .......................................................... 14, 18
`
`29 U.S.C. § 157 ............................................................ 6
`
`Cal. Civ. Code § 3513 ...................................... 7, 11, 21
`
`Cal. Lab. Code § 2698 .......................................... 10, 31
`
`Other Authorities
`
`Henry Campbell Black, A Treatise on
`the Rescission of Contracts &
`Cancellation of Written Instruments
`(1916) .................................................................... 16
`
`Mathieu Blackston, California’s Unfair
`Competition Law—Making Sure the
`Avenger Is Not Guilty of the Greater
`Crime, 41 San Diego L. Rev. 1833
`(2004) .................................................................... 22
`
`Stephen A. Broome, An Unconscionable
`Application of the Unconscionability
`Doctrine: How the California Courts
`Are Circumventing the Federal
`Arbitration Act, 3 Hastings Bus. L.J.
`39 (2006) ............................................................... 33
`
`
`
`
`
`xii
`
`Comment, Erie, Bernhardt, and Section
`2 of the United States Arbitration
`Act: A Farrago of Rights, Remedies,
`and a Right to a Remedy, 69 Yale
`L.J. 847 (1960) ................................................ 17, 21
`
`Alison Frankel, The 9th Circuit Just
`Blew Up Mandatory Arbitration in
`Consumer Cases, Reuters (July 1,
`2019), https://reut.rs/30Ufvxq ............................. 23
`
`Sales and Contracts to Sell in Interstate
`and Foreign Commerce, and Federal
`Commercial Arbitration: Hearing on
`S. 4213 and S. 4214 Before the S.
`Subcomm. on the Judiciary, 67th
`Cong. (1923) ......................................................... 19
`
`Williston on Contracts (4th ed. 2019) ....................... 16
`
`
`
`
`
`
`
`
`PETITION FOR A WRIT OF CERTIORARI
`
`Petitioners Comcast Corporation and Comcast
`Cable Communications, LLC respectfully petition for
`a writ of certiorari to review the judgment of the
`United States Court of Appeals for the Ninth Circuit.
`OPINIONS BELOW
`The memorandum disposition of the court of ap-
`peals (Pet. App. 1a–2a) is reported at 772 F. App’x
`569. The opinion of the court of appeals in a parallel
`case raising the same issues (Pet. App. 3a–28a) is re-
`ported at 928 F.3d 819. The district court’s order (Pet.
`App. 29a–32a) is unreported but available at 2018 WL
`4846548.
`
`JURISDICTION
`The judgment of the court of appeals was entered
`on June 28, 2019. Pet. App. 1a. A timely petition for
`rehearing was denied on January 17, 2020. Pet. App.
`33a. The jurisdiction of this Court is invoked under
`28 U.S.C. § 1254(1).
`CONSTITUTIONAL AND STATUTORY
`PROVISIONS INVOLVED
`Relevant provisions of the Constitution and the
`Federal Arbitration Act are reproduced in the Appen-
`dix. Pet. App. 34a–43a.
`
`
`
`
`
`
`
`
`
`
`2
`
`STATEMENT
`The Federal Arbitration Act (“FAA”) provides that
`written arbitration agreements are “valid, irrevoca-
`ble, and enforceable,” except “upon such grounds as
`exist at law or in equity for the revocation of any con-
`tract.” 9 U.S.C. § 2. This Court recently “[p]ut to the
`side the question of what it takes to qualify as a
`ground for ‘revocation’ of a contract,” while reiterating
`that the FAA “protect[s] pretty absolutely” the ability
`of contracting parties to agree to “use individual-
`ized . . . procedures” to resolve disputes. Epic Sys.
`Corp. v. Lewis, 138 S. Ct. 1612, 1621–22 (2018). In
`this case, the Ninth Circuit sustained a judge-made
`rule rendering unenforceable arbitration provisions
`that preclude requests for public injunctive relief—
`that is, relief that primarily benefits persons other
`than the individual plaintiff. Pet. App. 1a–28a (citing
`McGill v. Citibank, N.A., 393 P.3d 85, 87 (Cal. 2017)).
`The court of appeals ruled both that this “McGill rule”
`falls within the FAA’s saving clause, and that it does
`not interfere with the fundamental attribute of arbi-
`tral bilateralism. Pet. App. 19a, 24a. As a result, the
`McGill rule now effectively precludes bilateral arbi-
`tration of consumer disputes in California.
`1. The FAA was enacted in 1925 (and recodified
`in 1947) “in response to widespread judicial hostility
`to arbitration agreements.” AT&T Mobility LLC v.
`Concepcion, 563 U.S. 333, 339 (2011). Prior to its en-
`actment, the “traditional judicial hostility against
`ousting courts” had resulted in the nonenforcement of
`otherwise valid agreements to arbitrate. Bernhardt v.
`Polygraphic Co. of Am., 350 U.S. 198, 210 (1956). The
`purpose of the Act is “to ensure judicial enforcement
`of privately made agreements to arbitrate.” Dean Wit-
`ter Reynolds, Inc. v. Byrd, 470 U.S. 213, 219 (1985).
`
`
`
`
`
`3
`
`
`In doing so, the FAA establishes “a liberal federal pol-
`icy favoring arbitration agreements, notwithstanding
`any state substantive or procedural policies to the con-
`trary.” Moses H. Cone Mem’l Hosp. v. Mercury Constr.
`Corp., 460 U.S. 1, 24 (1983).
`The linchpin of the FAA is Section 2, which pro-
`vides:
`A written provision in any maritime transac-
`tion or a contract evidencing a transaction in-
`volving commerce to settle by arbitration a
`controversy thereafter arising out of such con-
`tract or transaction . . . shall be valid, irrevo-
`cable, and enforceable, save upon such
`grounds as exist at law or in equity for the rev-
`ocation of any contract.
`9 U.S.C. § 2. Section 2 “reflects the fundamental prin-
`ciple that arbitration is a matter of contract.”
`Rent-A-Center, W., Inc. v. Jackson, 561 U.S. 63, 67
`(2010).
`Under the Supremacy Clause (U.S. Const. art. VI,
`cl. 2), state laws that conflict with the FAA are dis-
`placed by the FAA through the doctrine of preemption
`(see Preston v. Ferrer, 552 U.S. 346, 353 (2008)). Un-
`der Section 2, a State may not impose rules that—
`whether explicitly or covertly—disfavor arbitration.
`See Concepcion, 563 U.S. at 341. This Court has ap-
`plied Section 2 to hold preempted a number of state
`rules (many of them originating in California) under-
`mining the enforceability of arbitration agreements.
`See, e.g., Preston, 552 U.S. at 352, 359 (holding that
`the FAA preempted a California statute requiring the
`Labor Commissioner to determine certain issues rele-
`vant to the dispute); Perry v. Thomas, 482 U.S. 483,
`
`
`
`
`
`4
`
`
`491–92 (1987) (holding that the FAA preempted a Cal-
`ifornia statute requiring a judicial forum for resolving
`wage disputes); Southland Corp. v. Keating, 465 U.S.
`1, 10, 16–17 (1984) (holding that the FAA preempted
`the California Supreme Court’s interpretation of a
`statute to require a judicial forum for claims arising
`under the Franchise Investment Law).
`Section 2 of the FAA provides a limited exception
`to the general rule that written arbitration agree-
`ments are “valid, irrevocable, and enforceable”: A
`party resisting arbitration may raise, as a defense,
`state-law grounds that “exist at law or in equity for
`the revocation of any contract.” 9 U.S.C. § 2 (emphasis
`added). The saving clause of the FAA therefore “per-
`mits agreements to arbitrate to be invalidated by ‘gen-
`erally applicable contract defenses, such as fraud, du-
`ress, or unconscionability,’ but not by defenses that
`apply only to arbitration or that derive their meaning
`from the fact that an agreement to arbitrate is at is-
`sue.” Concepcion, 563 U.S. at 339 (quoting Doctor’s
`Assocs. v. Casarotto, 517 U.S. 681, 687 (1996)). The
`saving clause does not, however, permit state-law
`rules that “covertly” discriminate against arbitration
`“by disfavoring contracts that (oh so coincidentally)
`have the defining features of arbitration agreements.”
`Kindred Nursing Ctrs. Ltd. P’ship v. Clark, 137 S. Ct.
`1421, 1426 (2017).
`Even a ground “at law or in equity for the revoca-
`tion of any contract,” and thus within the saving
`clause, will be preempted by the FAA if it “interferes
`with fundamental attributes of arbitration.” Concep-
`cion, 563 U.S. at 344. In Concepcion, this Court held
`that the FAA preempted a California rule prohibiting
`waivers of class-action relief in consumer arbitration
`
`
`
`
`
`5
`
`
`agreements. Id. at 340 (citing Discover Bank v. Supe-
`rior Court, 113 P.3d 1100, 1110 (Cal. 2005)). Because
`of the complexities and costs associated with class-
`wide arbitration, this Court concluded that applying
`the Discover Bank rule to invalidate arbitration agree-
`ments containing class-action waivers would frustrate
`the FAA’s twin goals of “enforcement of private agree-
`ments and encouragement of efficient and speedy dis-
`pute resolution.” Id. at 345 (quotation marks omit-
`ted).
`Justice Thomas, who joined the majority in Con-
`cepcion, also wrote a concurrence regarding the scope
`of the saving clause. He explained that because the
`saving clause permits application of only “such
`grounds as exist at law or in equity for the revocation
`of any contract,” “[i]t would be absurd to suggest that
`[the saving clause] requires only that a defense apply
`to ‘any contract.’” Concepcion, 563 U.S. at 352
`(Thomas, J., concurring) (some quotation marks omit-
`ted). Instead, “the FAA requires that an agreement to
`arbitrate be enforced unless a party successfully chal-
`lenges the formation of the arbitration agreement,
`such as by proving fraud or duress.” Id. at 353. Jus-
`tice Thomas further observed that Section 4 of the
`FAA requires that “upon being satisfied that the mak-
`ing of the agreement for arbitration or the failure to
`comply therewith is not in issue, the court must order
`arbitration in accordance with the terms of the agree-
`ment.” Id. at 354–55 (quotation marks omitted).
`Reading the saving clause and Section 4 “harmoni-
`ously,” the saving clause “require[s] enforcement of an
`agreement to arbitrate unless a party successfully as-
`serts a defense concerning the formation of the agree-
`ment to arbitrate, such as fraud, duress, or mutual
`mistake.” Id. at 355. The Discover Bank rule was not
`such a defense. Id. at 356–57; see also Am. Express
`
`
`
`
`
`6
`
`
`Co. v. Italian Colors Rest., 570 U.S. 228, 239 (2013)
`(Thomas, J., concurring) (advancing the same inter-
`pretation).
`More recently, this Court held in Epic that the
`FAA’s enforcement of arbitration agreements was not
`displaced by the National Labor Relations Act, which
`prohibits employers from barring employees from en-
`gaging in “‘concerted activit[y].’” 138 S. Ct. 1612
`(quoting 29 U.S.C. § 157). The Court explained that
`the FAA protects “pretty absolutely” the right of par-
`ties in arbitration “to use individualized rather than
`class or collective action procedures.” Id. at 1621. And
`for that reason, “an argument that a contract is unen-
`forceable just because it requires bilateral arbitration”
`cannot withstand scrutiny under the FAA. Id. at
`1623. Thus, “by attacking (only) the individualized
`nature of the arbitration proceedings, the [challeng-
`ers’ argument] s[ought] to interfere with one of arbi-
`tration’s fundamental attributes.” Id. at 1622. Jus-
`tice Thomas, in concurrence, reiterated his view of the
`limited scope of the saving clause. See id. at 1632–33
`(Thomas, J., concurring). The majority did not disa-
`gree; rather, the Court “[p]ut to the side the question
`of what it takes to qualify as a ground for ‘revocation’
`of a contract” (id. at 1622), and decided the case on
`other grounds.
`2. After Concepcion—but before Epic—the Cali-
`fornia Supreme Court announced a new “rule” regard-
`ing “the validity of a provision in a predispute arbitra-
`tion agreement that waives the right to seek [public
`injunctive relief] in any forum.” McGill, 393 P.3d at
`87. “[P]ublic” injunctive relief is a type of relief in Cal-
`ifornia that has “the primary purpose and effect of
`prohibiting unlawful acts that threaten future injury
`to the general public.” Id. at 90 (quotation marks
`
`
`
`
`
`7
`
`
`omitted). The individual plaintiff benefits, “if at all,
`only incidentally and/or as a member of the general
`public.” Id. at 89 (alteration and quotation marks
`omitted). Public injunctive relief is frequently sought
`in false advertising suits, where the plaintiff is al-
`ready aware of the alleged falsity and cannot benefit
`from prospective relief.
`In McGill, the California Supreme Court held that
`a waiver “in a predispute arbitration agreement” of
`the right to seek public injunctive relief “in any forum”
`is “contrary to California public policy and is thus un-
`enforceable under California law.” 393 P.3d at 87 (em-
`phasis added). To reach that holding, the court exca-
`vated a provision from California’s “Maxims of Juris-
`prudence,” enacted in 1872 to aid statutory construc-
`tion (Cal. Civ. Code § 3513), that has never been ap-
`plied as a defense to contract formation or as a ground
`for the “revocation” of a contract. Nevertheless, the
`California Supreme Court held that its new rule was
`not preempted by the FAA because it preserved sub-
`stantive rights, citing Italian Colors, which was not a
`preemption case, for the proposition that the FAA
`does not require enforcement of an arbitration clause
`“that forbids the assertion of certain statutory rights.”
`McGill, 393 P.3d at 94–95 (alteration and quotation
`marks omitted). Even as it applied the new rule in
`McGill itself, the court did not hold the parties’ con-
`tract, or even the arbitration clause, “revoked” or in-
`valid; rather, the court remanded the case for the
`lower court to determine whether the rest of the arbi-
`tration agreement could nonetheless be enforced. Id.
`at 97–98.
`3. Respondents are subscribers to petitioners’ ca-
`ble, Internet, and/or telephone services. In the course
`of their relationship with petitioners, respondents
`
`
`
`
`
`8
`
`
`each received and assented to several iterations of pe-
`titioners’ Subscriber Agreement. Each version of the
`Subscriber Agreement contains a materially identical
`arbitration clause. The most recent version in effect—
`the 2017 Subscriber Agreement—sets forth the terms
`of arbitration in Section 13, entitled “BINDING
`ARBITRATION,” providing that “[a]ny Dispute in-
`volving [respondents] and [petitioners] shall be re-
`solved through individual arbitration.” Pet. App. 37a.
`In subsection (h), the 2017 Subscriber Agreement
`includes a “Waiver of Class Actions and Collective Re-
`lief”:
`THERE SHALL BE NO RIGHT OR AU-
`THORITY FOR ANY CLAIMS TO BE ARBI-
`TRATED OR LITIGATED ON A CLASS
`ACTION, JOINT OR CONSOLIDATED
`BASIS OR ON BASES INVOLVING CLAIMS
`BROUGHT IN A PURPORTED REPRE-
`SENTATIVE CAPACITY ON BEHALF OF
`THE GENERAL PUBLIC (SUCH AS A PRI-
`VATE ATTORNEY GENERAL), OTHER
`SUBSCRIBERS, OR OTHER PERSONS.
`THE ARBITRATOR MAY AWARD RELIEF
`ONLY IN FAVOR OF THE INDIVIDUAL
`PARTY SEEKING RELIEF AND ONLY TO
`THE EXTENT NECESSARY TO PROVIDE
`RELIEF WARRANTED BY THAT INDIVID-
`UAL PARTY’S CLAIM.
`Pet. App. 41a. It is undisputed that this provision pro-
`hibits either side from seeking public injunctive relief
`in arbitration.
`Respondents and two other consumers brought
`this lawsuit in California state court in 2017, alleging
`
`
`
`
`
`9
`
`
`that petitioners engage in false and misleading adver-
`tising with respect to the pricing of their cable televi-
`sion service packages. Respondents seek relief under
`California’s Unfair Competition Law (Cal. Bus. &
`Prof. Code § 17200 et seq.), False Advertising Law (id.
`§ 17500 et seq.), and Consumer Legal Remedies Act
`(Cal. Civ. Code § 1750 et seq.), and also allege breach
`of contract. First Am. Compl. ¶¶ 237–93. In addition
`to seeking to certify a class of “approximately two mil-
`lion California consumers” (id. ¶ 232), respondents
`also “seek public injunctive relief for the benefit of
`themselves and for the benefit of millions of other Cal-
`ifornia consumers” (id. ¶ 180). Petitioners removed
`the case to the United States District Court for the
`Northern District of California on the basis of diver-
`sity and filed a motion to compel individual arbitra-
`tion with respect to two plaintiffs (respondents here);
`the other two plaintiffs timely opted out of arbitration.
`Respondents did not dispute that their claims fall
`within the arbitration provision, but resisted arbitra-
`tion principally on the ground that the McGill rule
`renders Section 13(h)’s waiver of public injunctive re-
`lief in arbitration unenforceable; and therefore, be-
`cause the 2017 Subscriber Agreement contains a non-
`severability clause (Pet. App. 41a), the entire arbitra-
`tion provision is unenforceable (but not revoked). In
`reply, petitioners argued that the FAA preempts the
`McGill rule.
`In February 2018, the district court denied the
`motion to compel arbitration, relying entirely on the
`McGill rule. Pet. App. 29a–32a. The court cited two
`other district court decisions applying the McGill rule
`in analogous circumstances. Pet. App. 30a. Each of
`them had relied in substantial part on Sakkab v. Lux-
`ottica Retail North America, Inc., 803 F.3d 425 (9th
`
`
`
`
`
`10
`
`
`Cir. 2015)—a case in which a divided panel of the
`Ninth Circuit upheld against a FAA challenge a dif-
`ferent California “rule” prohibiting arbitral waivers of
`the right to bring a representative claim under Cali-
`fornia’s Private Attorneys General Act. See Cal. Lab.
`Code § 2698. Petitioners here filed a timely appeal
`pursuant to 9 U.S.C. § 16(a)(1)(B).
`4. The Ninth Circuit heard oral argument in three
`related cases all raising the same issue: Whether the
`FAA preempts the McGill rule. Emphasizing the
`weight of Supreme Court precedent requiring the en-
`forcement of arbitration agreements, counsel for peti-
`tioners had the following exchange with the panel:
`Counsel: We have every Supreme Court case
`for the last thirty years on our side, and they
`have Sakkab on their side. I mean, that’s re-
`ally the weighing that’s before the Court,
`right?
`The Court: That’s actually fairly common.
`You’ve got the Supreme Court over there and
`the Ninth Circuit over here.
`That colloquy proved prescient: On June 28, 2019, the
`Ninth Circuit issued a panel opinion in the first filed
`of the three related cases, holding that the FAA does
`not preempt the McGill rule. Pet. App. 3a. It simul-
`taneously issued a memorandum disposition in this
`case (Pet. App. 1a–2a) as well as in another case in-
`volving AT&T (see McArdle v. AT&T Mobility LLC,
`772 F. App’x 575 (9th Cir. 2019)).
`With respect to the applicability of the FAA’s sav-
`ing clause, the Ninth Circuit held that “[t]he McGill
`rule . . . is a generally applicable contract defense.”
`Pet. App. 16a. The panel did not engage with the ex-
`tensive arguments presented by petitioners in this
`
`
`
`
`
`11
`
`
`case regarding the limited scope of the saving clause.
`See C.A. Br. 27; C.A. Reply Br. 5–8. Rather, the panel
`discussed only the fact that the California statute
`from which the California Supreme Court purported
`to derive the McGill rule (Cal. Civ. Code § 3513) had
`been applied in a variety of different contexts. Pet.
`App. 18a–19a. The panel did not (and could not) iden-
`tify any cases in which the statute had been applied
`to revoke a contract. Nevertheless, the panel summar-
`ily concluded that the rule “is a ground for the revoca-
`tion of any contract and falls within the FAA’s saving
`clause.” Pet. App. 19a (alterations and quotation
`marks omitted).
`On the question of whether the McGill rule inter-
`feres with fundamental attributes of arbitration, the
`panel relied principally on the majority decision in
`Sakkab. Pet. App. 20a. The court did not even ad-
`dress the California Supreme Court’s erroneous reli-
`ance on the “effective vindication” doctrine set forth in
`Italian Colors. Instead, the panel held that public in-
`junctive relief did not interfere with bilateralism, be-
`cause a request for such relief does not implicate
`“state-law class procedures,” and a plaintiff seeking
`public injunctive relief “files the lawsuit on his or her
`own behalf and retains sole control over the suit.” Pet.
`App. 20a–21a (quotation marks omitted).
`Petitioners filed a timely petition for panel rehear-
`ing and rehearing en banc, which the court denied on
`January 17, 2020. Pet. App. 33a.
`REASONS FOR GRANTING THE PETITION
`This petition presents two important questions
`under the Federal Arbitration Act that should be de-
`cided by this Court at this time. The first is whether
`
`
`
`
`
`12
`
`
`state anti-arbitration rules that are not generally ap-
`plicable defenses to contract formation fall within the
`FAA’s saving clause, an issue that Justice Thomas has
`identified in a series of concurring opinions but the
`full Court has never addressed; the second is whether
`such state rules (even if they fall within the saving
`clause) are preempted outside the class- or collec-
`tive-action context.
`First, this case squarely presents the question
`whether the FAA’s saving clause applies only to those
`defenses that provide a ground for the “revocation” of
`a contract, such as those defenses going to the for-
`mation of the agreement. This Court has expressly
`reserved judgment on whether the saving clause can
`sweep more broadly than its plain text permits. That
`question should be decided now, in this case, to pro-
`vide guidance to lower courts and contracting parties.
`The saving clause, by its express terms and consistent
`with the structure
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