Federal Judge Issues Preliminary Injunction Prohibiting Enforcement of AB 51 Regarding Mandatory Arbitration Agreements

Federal Judge Issues Preliminary Injunction Prohibiting Enforcement of AB 51 Regarding Mandatory Arbitration Agreements

On January 31, 2020, Judge Kimberly Mueller of the United States District Court for the Eastern District of California issued a minute order granting a motion for a preliminary injunction prohibiting the State of California from enforcing Assembly Bill No. 51. AB 51 prohibits employers from requiring applicants and employees to enter into mandatory arbitration agreements regarding discrimination claims under the Fair Employment and Housing Act and wage claims under the Labor Code as a condition of employment. In the minute order she issued in U.S. Chamber of Commerce v. Becerra, Judge Mueller stated that she will issue a detailed, written order explaining the court’s reasoning “in the coming days.” Judge Mueller had issued a temporary restraining order a few days before AB 51 would have become effective on January 1, 2020, having found that serious questions existed regarding whether AB 51 was preempted by the Federal Arbitration Act.