Wise v. Tesla Motors, Inc., 2025 WL 3707196 (Cal. Ct. App. 2025)

Talia Shayla Alexis Wise sued her former employer (Tesla) for disability discrimination and related claims. In response, Tesla filed a motion to compel arbitration, which the trial court denied after determining that the arbitration agreement should be read together with a nondisclosure agreement (NDA), which contained unconscionable terms that permeated the arbitration agreement. On appeal, Tesla argued that the Federal Arbitration Act (FAA) preempts Cal. Civ. Code § 1642 (requiring that the agreements should be read together) and that in any event the unconscionable terms should have been severed so that the arbitration agreement could be enforced. The Court of Appeal disagreed with Tesla that the FAA preempted California law but agreed that the unconscionable provisions of the NDA were severable and that the arbitration agreement should have been enforced. See also Tuufuli v. West Coast Dental Admin. Services, LLC, 2026 WL 92021 (Cal. Ct. App. 2026) (arbitration agreement was governed by FAA because the parties expressly agreed that it would regardless of the existence of interstate commerce).