The Death Knell Still Rings Naught!

Nguyen v. Applied Med. Res. Corp., No. G052207 (D4d3 Oct. 14, 2016)

Denials of class cert motions and grants of motions to compel arbitration of claims subject to class action waivers are usually appealable under the “death knell” doctrine. The gist is that what’s left of the case is usually not economically viable to try or arbitrate, so refusing the permit the plaintiff on proceed on a class basis is the “death knell” for the litigation more generally, and thus provides a justification for an interlocutory appeal. 

But Munoz v. Chipotle, Mexican Grill, Inc., 238 Cal. App. 4th 291 (2015) held that the death knell doctrine doesn’t apply when a case includes Private Attorney General Act representative claims that can’t be sent to arbitration. (For those not following along, in Iskanian, the Supreme Court held that PAGA claims aren’t arbitrable because they technically belong to the state.) Defendant here argues that Munoz was wrong, but the court isn’t on board. So there’s no jurisdiction to hear an interlocutory appeal.

Nevertheless, the Court of Appeal exercises its prerogative to treat a defective appeal as a writ. It then affirms on all grounds save one: Under the Supreme Court’s recent Sandquist decision, when contract that expressly assigns questions of arbitrability to the arbitrator but is silent on who decides whether class arbitration will be permissible, it is up to the arbitrator to decide whether the plaintiff can proceed by class arbitration. 

And that’s the setup here. So the trial court erred by striking the class allegations from the non-PAGA claims before severing them out and compelling them to arb. Finding plaintiff’s other issues lack merit, the court issues a writ ordering the trial court to vacate its order striking the class claims so that the whole shebang (save PAGA claims) can go to an arbitrator.

Writ granted, in part.