Nevada Appellate Lawyer & Attorney : Tami D. Cowden : Nevada Supreme Court, Ninth Circuit Court of Appeals

Three of the decisions issued by the U.S. Supreme Court yesterday revolved around the issue of federal preemption of state law. In each, the Court found the state law preempted.

Plaintiffs’ attorneys took a hit in Riegel v. Medtronic, Inc., where the Court held 8-1 ruling that state common law tort claims were preempted by the Medical Device Amendments (MDA) of 1976.  Te MDA established federal oversight of the safety of medical devices. Justice Ginsburg was the lone dissenter, calling the majority opinion "radical curtailment" of state common law claims that Congress never intended.   Stevens concurred in the judgment, agreeing with the majority that the statute’s text preempts the state common law claims. However, he also agreed with Ginsburg that Congress’ intent was otherwise.

TV's Judge Alex  got a lesson in jurisprudence in Preston v. Ferrer. The Court held in an 8-1 decision that the Federal Arbitration Act (FAA) compelled arbitration of celebrity judge Alex Ferrer’s dispute with his talent agent, preempting California Talent Agency Act, which gave exclusive jurisdiction of the dispute to California’s Labor Commission. The Court held that when the parties agree to arbitration in a contract, the FAA will preempted any state law vesting jurisdiction in another forum, whether judicial or administrative. Justice Ginsburg drafted the majority opinion.  Justice Thomas dissented, staying true to his view that the FAA has no application in state court proceedings. 

The tobacco industry saw a victory in Rowe v. New Hampshire Motor Transp. Assn., where the Court unanimously struck down a Maine law prohibiting Internet tobacco sales to minors. The Court held the state statute was preempted by federal law prohibiting states from regulating prices, routes or services of shipping companies, because the Maine law restricted transportation companies from delivering tobacco products directly to consumers. The Court rejected Maine’s argument that federal laws do not preempt state statutes enacted to protect the public health, finding no public health exception in the federal statute’s text.  Justice Breyer authored the opinion.

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In Davis v. O’Melveny & Myers, the Ninth Circuit ruled a mandatory arbitration clause imposed by a law firm upon employees unconscionable under California law. The firm’s dispute resolution program, which created deadlines for bringing claims, imposed confidentiality requirements, compelled mediation and culminated in binding arbitration, was imposed on a take it or leave it basis. The only way to opt out of the program would be to leave the employment entirely. The fact that employees had three days notice of what would be imposed upon them was not sufficient to salvage the “agreement” from procedural unconscionability.

The agreement’s one year claims filing deadline, potential waiver of statutory rights, and confidentiality requirements rendered it substantively unconscionable. The latter, for example, would have greatly hampered any discovery, as a claimant could not contact current or former employees regarding the claim.

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