New California Supreme Court Arbitration Case

New California Supreme Court Arbitration Case

Is an Arbitration Agreement Enforceable When There Is Procedural Unconscionability (including tiny, blurry print and rushed presentation) and a Low-to-Moderate Degree of Substantive Unconscionability (including a one-sided carveout tied to later confidentiality agreements)? 

The California Supreme Court addressed this issue last month. Below is my one-paragraph case summary from my online publication California Case Summaries™: 

Fuentes v. Empire Nissan (2026) _ Cal.5th _ , 2026 WL 265574: The California Supreme Court reversed the Court of Appeal’s decision, which had reversed the trial court’s order denying defendant’s motion to compel arbitration in an employment case. The trial court denied defendant’s motion to compel arbitration, finding the employment arbitration agreement was unconscionable based on a very high degree of procedural unconscionability (including the agreement’s tiny, blurry print and rushed presentation) and a low-to-moderate degree of substantive unconscionability (including a perceived one-sided carveout tied to later confidentiality agreements). The Court of Appeal reversed and directed the trial court to grant the motion to compel arbitration, reasoning that illegibility goes only to procedural unconscionability and that, properly construed, the confidentiality agreements did not create substantive one-sidedness. The Supreme Court held that format/legibility generally does not itself establish substantive unconscionability, but concluded the Court of Appeal erred by using a pro-arbitration interpretive presumption and by directing an order compelling arbitration rather than remanding. The California Supreme Court reversed and remanded for further trial-court proceedings (including consideration of unresolved validity/assent and related issues) consistent with the clarified unconscionability framework. (February 2, 2026.)

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Monty McIntyre helps attorneys throughout California settle cases as a mediator, decide cases as an arbitrator and decide issues as a referee at ADR Services, Inc. handling employment, tort, business, commercial, insurance, probate and real property cases. He brings to his ADR work extensive experience as a California civil trial lawyer since 1980 who has represented both plaintiffs and defendants in these areas. Monty has been a member of the American Board of Trial Advocates (ABOTA) since 1995, has tried over 100 civil cases including numerous civil jury trials, is a past president of the San Diego County Bar Association and is a past president of the San Diego Chapter of ABOTA. To schedule a new matter, please contact one of Monty's case managers at ADR services, Inc.:
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