Dorman v. The Charles Schwab Corp., No. 18-15281 (9th Cir. 2019)
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The Ninth Circuit reversed the district court's order denying Schwab's motion to compel arbitration in a class action brought by a former participant in an Employee Retirement Income Security Act (ERISA) retirement plan. Plaintiff alleged that defendants violated ERISA and breached their fiduciary duties by including Schwab-affiliated investment funds in the Plan—despite the funds' poor performance—to generate fees for Schwab and its affiliates.
In light of the Supreme Court's intervening case law, the panel held that its holding in Amaro v. Continental Can Co., 724 F.2d 747 (9th Cir. 1984), that ERISA claims were not arbitrable, was no longer good law. The panel held that the holding in American Express Co. v. Italian Colors Restaurant, 570 U.S. 228 (2013), that federal statutory claims are generally arbitrable and arbitrators can competently interpret and apply federal statutes, was irreconcilable with Amaro. Accordingly, the court remanded.
Court Description: ERISA / Arbitration The panel reversed the district court’s order denying defendants’ motion to compel arbitration of claims and remanded in a class action suit brought by a former participant in an ERISA retirement plan, alleging that defendants violated ERISA and breached their fiduciary duties by including certain investment funds in the plan. The panel concluded that Amaro v. Continental Can Co., 724 F.2d 747 (9th Cir. 1984), which held that ERISA claims are not arbitrable, is no longer good law in light of intervening Supreme Court case law, including American Express Co. v. Italian Colors Restaurant, 570 U.S. 228 (2013). * The Honorable Benita Y. Pearson, United States District Judge for the Northern District of Ohio, sitting by designation. DORMAN V. CHARLES SCHWAB CORP. 3 The panel addressed other issues in a concurrently filed memorandum disposition.
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