Colon-Perez v. Security Indus. Specialists, 108 Cal. App. 5^th 575 (2025)

The employer in this case (SIS) challenged Cal. Code Civ. Proc. § 1281.98 (requiring an employer to pay arbitration fees within 30 days or waive the right to arbitrate) on various grounds, including that the statute is preempted by the Federal Arbitration Act (FAA). This issue is currently pending before the California Supreme Court in Keeton v. Tesla, Inc., 103 Cal. App. 5^th 26, rev. granted (2024). In this case, the Court of Appeal held “we are not persuaded to depart from our conclusions in Keeton” that the FAA does not preempt the state statute. The Court further held that Cal. Code Civ. Proc. § 473(b) (excusable neglect of counsel) was inapplicable to remedy the failure to comply with Section 1281.98. See also Arzate v. ACE Am. Ins. Co., 108 Cal. App. 5^th 1191 (2025) (plaintiff not defendant was required to initiate arbitration after trial court granted defendant’s motion to compel arbitration).