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U.S. Supreme Court Favors Arbitration Over CA Agent's Law
The U.S. Supreme Court decided that the Federal Arbitration Act (FAA) overrode the California Talent Agencies Act (TAA) for purposes of sending a dispute between a TV personality and his personal manager to an arbitrator per an arbitration clause in the management contract. Preston v. Ferrer, 06-1463. The California Court of Appeal had ruled in the dispute between TV's 'Judge Alex' Ferrer and manager Arnold Preston that under the TAA, the California Labor Commissioner had original jurisdiction over Preston's claim for management commissions from Ferrer. (Ferrer had argued the management contract was void on the ground that Preston acted as in unlicensed talent agent.)
Reversing and remanding, the U.S. Supreme Court ruled 8-1 for Preston. Associate Justice Ruth Bader Ginsburg noted in her majority opinion: '[W]hen parties agree to arbitrate all questions arising under a contract, state laws lodging primary jurisdiction in another forum, whether judicial or administrative, are superseded by the FAA.'
Ginsburg continued: 'The dispositive issue, then, contrary to Ferrer's suggestion, is not whether the FAA preempts the TAA wholesale. ' The FAA plainly has no such destructive aim or effect. Instead, the question is simply who decides whether Preston acted as personal manager or as talent agent.'
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