On June 28, the Ninth Circuit adopted the California Supreme Court’s McGill rule in Blair v. Rent-a-Center, Inc., 928 F.3d 819 (9th Cir. 2019). In Blair, the Ninth Circuit held the McGill rule to be consistent with the Federal Arbitration Act (“FAA”), and therefore not preempted by the federal statute.
The McGill rule was the result of a decision by the California Supreme Court in which it held that a consumer credit card agreement waiving the consumer’s right to seek public injunctive relief violated California Civil Code § 3513. Section 3513 provides that “a law established for a public reason cannot be contravened by a private agreement.” Blair, 928 F.3d at 824. Several California consumer protection statutes explicitly provide consumers with the right to pursue a public injunctive remedy.