Sakkab v. Luxottica Retail N. Am.

Plaintiff filed a putative class action against Luxottica asserting four causes of action arising out of his employment with Luxottica, including (1) unlawful business practices, (2) failure to pay overtime compensation, (3) failure to provide accurate itemized wage statements, and (4) failure to pay wages when due. The district court subsequently granted Luxottica's motion to compel arbitration and dismissed the first amended complaint. This appeal presents issues of first impression regarding the scope of Federal Arbitration Act (FAA) preemption, 9 U.S.C. 2 et seq., and the meaning of the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion. The court must decide whether the FAA preempts the California rule announced in Iskanian v. CLS Transportation Los Angeles, which bars the waiver of representative claims under the Private Attorneys General Act of 2004 (PAGA), Cal. Lab. Code 2698 et seq. The court concluded that the FAA does not preempt the Iskanian Rule because the Rule leaves parties free to adopt the kinds of informal procedures normally available in arbitration. It only prohibits them from opting out of the central feature of the PAGA’s private enforcement scheme–the right to act as a private attorney general to recover the full measure of penalties the state could recover. Accordingly, the court reversed the district court’s order dismissing the complaint and returned the issue to the district court and the parties to decide in the first instance where plaintiff's representative PAGA claims should be resolved, and to conduct further proceedings. View "Sakkab v. Luxottica Retail N. Am." on Justia Law