Arbitration, Employment: Fourth District, Div. 3 Holds Employee's Unfair Competition Law Claim Seeking Private Injunctive Relief Is Arbitrable

Court Of Appeal Distinguishes The Broughton-Cruz Rule.

        Clifford v. Quest Software, Inc., G055858 (4/3  8/14/19) (Aronson, O'Leary, Goethals) addresses, "whether an employee's claim against his employer for unfair competition under Business and Professions Code section 17200 (the UCL) is arbitrable." Assuming the arbitration clause is valid and enforceable, the Court holds that a UCL claim including a request for private injunctive relief is arbitrable. The Court distinguishes the so-called Broughton-Cruz rule, explaining that the "rule distinguishes between public injunctive relief and private injunctive relief, and it only bars arbitration of claims for public injunctive relief."

        COMMENT:  The Court observes that several courts have concluded that the Federal Arbitration Act preempts the Broughton-Cruz restriction on arbitrability. But the Court does not address that issue, since it concludes that even if the rule is not preempted by the FAA, it does not prevent the arbitration of a UCL claim requesting private injunctive relief and restitution. We've posted before about the Broughton-Cruz rule on March 7, 2012, December 18, 2014, and  April 6, 2017.