California Law Archives – Southern California Law Review

Getting a Bad “Wrap”: An Analysis of Online Contract Cases in California After Step-Saver and ProCD

April 2025April 2025Sophie Lee*

Consumers routinely enter contracts when engaging in online commerce. Such “contracts of adhesion” are created by sellers and provide no opportunity to negotiate. By surveying California state and federal court cases, this Note explores how California courts evaluate notice. Courts recognize four types of online contracts: clickwrap, browsewrap, scrollwrap, and sign-in-wrap. This Note also draws on the seminal cases Step-Saver Data Systems v. Wyse and ProCD, Inc. v. Zeidenberg to discuss and compare the standards of notice used by courts. Overall, a uniform standard of notice has not yet emerged in California, and Step-Saver and ProCD remain relevant as courts primarily rely on fact-specific notice analysis. The utility of the four types of “wrap” categories may be diminishing as the online landscape evolves and changes.

INTRODUCTION

Imagine that you are purchasing something online, as you have likely done in the past. You enter the seller’s website and pick out the product you want to buy—say, a pair of socks—then start the payment process by entering your personal information. As you are about to click “Complete Purchase,” you see a notice pop up on the screen: “By completing your purchase, you agree to our Terms and Conditions.” You pause for a moment, wondering whether you should review the terms, but that would involve opening another webpage and parsing through pages of dense legal language. You have purchased socks online before—what is the worst that can happen? Instead, you agree and complete your purchase. When you think back to the transaction, perhaps you will remember seeing the pop-up notice, or perhaps you will not. The result will likely be the same. You have assented to the seller’s terms and entered a contract.

It is a common law principle that buyers and sellers should be held accountable for the contracts that they create, but one-sided form contracts are sometimes regarded differently. Courts have grappled with the issue of assent to sales contracts since before the Internet became the commercial engine that it is today. “Box-top” or “shrinkwrap” contracts list the terms of the agreement on the outside of a product’s packaging. By opening the packaging, a buyer manifests their intent to be bound by the terms. In 1991, the Third Circuit Court of Appeals decided a case involving a box-top license on a software product.¹ The court ruled for the software buyer, deeming the box-top license a proposal for new terms of agreement rather than a binding contract.² In contrast, when a similar case made its way to the Seventh Circuit Court of Appeals in 1996, the court ruled in favor of a software seller.³ The seller’s shrinkwrap agreement was binding because opening a package was a valid way for a buyer to accept the seller’s offer.⁴ Step-Saver Data Systems v. Wyse (“Step-Saver”) and ProCD, Inc. v. Zeidenberg (“ProCD”), respectively, came to represent two distinct views on box-top and shrinkwrap contracts. Simply put, Step-Saver placed a greater burden on sellers by giving buyers the benefit of the doubt as to their awareness of new terms. ProCD, however, placed a greater burden on buyers to apprise themselves of a seller’s terms. Though nearly three decades old, Step-Saver and ProCD still form the foundation of how courts approach disputes over online contracts.

Today, the average consumer would struggle to avoid such “contracts of adhesion” (also called form or “boilerplate” contracts), which offer no opportunity for negotiation on the part of the buyer. These contracts are efficient for sellers; modern commerce would not be nearly as fast or profitable if it were not for these contracts. But the ubiquity of online contracting and the rapid evolution of sellers’ websites raises questions about contract law and consumer protection. How should courts balance enabling transaction efficiency while ensuring buyers are aware of sellers’ terms?

California generally categorizes online contracts by modes of assent and into four types: “clickwraps,” “browsewraps,” “scrollwraps,” and “sign-in-wraps.”⁵ Clickwrap agreements require an affirmative act of assent to become binding (e.g., clicking a button that reads “I have read and accepted the Terms and Conditions”).⁶ In contrast, browsewrap agreements do not require an affirmative act as to specific terms of the contract; “an internet user accepts a website’s terms of use merely by browsing the site” ⁷ (e.g., a text banner that reads, “Use of this website constitutes agreement to the Terms and Conditions”). Scrollwrap agreements require a user to physically scroll to the bottom of a page containing the terms before proceeding to use a website.⁸ Finally, sign-in-wrap agreements require a user to sign up for an Internet service or product, the process of which indicates assent to the seller’s terms.⁹ These four types of “wrap” create contracts of adhesion and, as their names suggest, are regarded by courts as the digital successors of shrinkwrap. Thus, when faced with a clickwrap, browsewrap, scrollwrap, or sign-in-wrap agreement, buyers are offered no opportunity to negotiate and can only “take it or leave it.”¹⁰

This Note presents a case law survey of California state and federal district court cases between the years 2014 and 2024. It discusses the validity of the four commonly recognized types of online agreements and analyzes how courts’ approaches differ depending on the type of “wrap.” Part I provides background on contract common law, Step-Saver and ProCD, and significant U.S. Court of Appeals decisions. Part II details the case law survey: Section II.A describes state court cases and Section II.B describes federal district court cases. Section II.C summarizes the results of the survey and considers its implications for the way courts categorize online agreements and for the legacy of Step-Saver and ProCD.

This Note concludes that state and federal components of the case law survey largely reached the same outcomes with similar reasoning. Courts used multiple standards to determine whether a buyer received adequate or sufficient notice of a seller’s terms, including both a “reasonable notice” and a “reasonably prudent” user standard that can be traced back to ProCD and Step-Saver. This survey shows that a predominant standard for notice has not yet emerged in California (although recent approaches set out by the Ninth Circuit may promote greater consistency going forward). Overall, courts generally remained deferential to sellers and their offers. Fact-specific inquiries into whether a buyer was given reasonable notice were common among the cases surveyed. Thus, meaningful categories of “wrap” types may be gradually losing utility. Finally, this Note briefly considers whether Step-Saver and ProCD are still relevant to current and prevalent forms of online contracts and explains that these cases establish and solidify California’s most prevalent notice standards.

I. BACKGROUND

It is a basic principle of common law that the formation of a contract requires an “offer” and “acceptance.”¹¹ Step-Saver Data Systems v. Wyse and ProCD, Inc. v. Zeidenberg are seminal cases for their applications of common law principles within the context of box-top and shrinkwrap sales agreements. The same fundamental issues and principles remain relevant among newer types of agreements for selling goods and services on the Internet, such as clickwrap and browsewrap agreements. Today, courts often defer to sellers’ proposed modes of assent while using a fact-based “adequate notice” standard to evaluate the validity of a “wrap” agreement.¹²

A. Contract Common Law: Offer and Acceptance

Because the “elemental principles of contract formation apply with equal force to contracts formed online,”¹³ the same principles of contract common law are relevant when considering the validity of an online agreement.¹⁴ For a contract to be enforceable, common law requires that the parties’ bargaining process must meet two basic requirements: (1) both parties must assent to be bound, and (2) the agreement must be “definite” enough to be enforceable.¹⁵ The first requirement incorporates the presumption that one must consent to be bound, while the second requirement emphasizes the importance of receiving what one contracted for.¹⁶ The process of assenting can be broken down into two steps: “offer” and “acceptance.”¹⁷ An offer is a “promise” conditional on an action by the offeree.¹⁸ When an offeror makes an offer to the offeree, the offeree can accept, conveying their assent to be bound by the offeror’s terms. Offers can take many forms, and the offeror has the ability and authority to set the terms of their offer and to specify a mode of acceptance.¹⁹ Disputes can arise over whether the offeree had reason to believe that an offer was intended by the offeror to constitute an offer.²⁰ As discussed further below, in the realm of online contracts, consumers are often unaware that completing a purchase or signing into an account indicates assent to the terms of a seller’s agreement or even that a contract is being formed at all.

Parties can manifest assent in writing, through spoken word, or through conduct.²¹ Doctrine on assent is split between a subjective theory of assent, which focuses on the actual intent of the parties to be bound through a “meeting of the minds,” and an objective theory of assent, which focuses on the “external . . . appearance of the parties’ intentions as manifested by their actions.”²² To avoid issues related to the negotiation process, many sellers use form contracts that set out standard, nonnegotiable terms for transactions.²³ An offeree has only two options: to proceed with the transaction and accept the terms, or to decline.²⁴ These contracts are highly efficient for offerors but can come with drawbacks for offerees. For example, under common law, it does not matter if an offeree assents carelessly or fails to consider the legal consequences of a contract. Failure to read a contract is not a defense to breach of contract.²⁵

B. From Shrinkwrap to Clickwrap

The court in Step-Saver invalidated a shrinkwrap contract and deemed it a modification of an existing contract to which the buyer did not affirmatively assent. In contrast, the court in ProCD held that a shrinkwrap license was valid because the buyer was provided notice of the terms. Courts generally examine whether a seller provided adequate notice of its terms because online modes of assent to form contracts and website checkout flows greatly vary. In California, online contracts are sorted into four categories: clickwrap, browsewrap, scrollwrap, and sign-in-wrap. Each category has its own unique implications.

1. Step-Saver and ProCD

The box-top license printed on each package in Step-Saver Data Systems v. Wyse was a form contract that stated, “Opening this package indicates your acceptance of these terms and conditions. If you do not agree with them, you should promptly return the package unopened to the person from whom you purchased it . . . .”²⁶ Step-Saver, the buyer, argued that the box-top license materially altered a contract that was previously negotiated over the phone with The Software Link, Inc. (“TSL”), the seller, and that it was not binding under Uniform Commercial Code (“UCC”) Section 2-207.²⁷ On the other hand, TSL argued that a contract came into existence when Step-Saver received the terms of the license on the package and still proceeded to open the box; thus, phone conversations were merely counteroffers and negotiations.²⁸ The court ruled for Step-Saver, deciding that the box-top license should be seen as “one more form in a battle of forms”²⁹ and that the terms were not binding because they materially altered the parties’ agreement.³⁰ Judge John Minor Wisdom emphasized the fact that based on the parties’ previous negotiations, Step-Saver would not have expected to be bound by the box-top license.³¹ In response to TSL’s argument that its offer to issue a refund protected Step-Saver enough to validate the box-top license, Judge Wisdom wrote, “[w]e see no basis in the terms of the box-top license for inferring that a reasonable offeror would understand from the refund offer that certain terms of the box-top license, such as the warranty disclaimers, were essential to TSL.”³² In his holding, he wrote that “Step-Saver [could] reasonably believe that, while TSL desires certain terms, it has agreed to do business on other terms.”³³ Thus, this decision implies that a contract should not be binding unless a buyer affirmatively assents to a form contract and the parties reasonably believe that it is binding.

Judge Wisdom also rejected the seller’s arguments that ruling in favor of Step-Saver would adversely affect the industry. He wrote:

We are not persuaded that requiring software companies to stand behind representations concerning their products will inevitably destroy the software industry. We emphasize, however, that we are following the well-established distinction between conspicuous disclaimers made available before the contract is formed and disclaimers made available only after the contract is formed.³⁴

The court also speculated that sellers who justify the use of a box-top license with an optional refund provision might be “relying on the purchaser’s investment in time and energy in reaching this point in the transaction to prevent the purchaser from returning the item,” suggesting that a refund provision is generally not an adequate safeguard for consumers who assent to a license by opening a package.³⁵ Step-Saver represents a rare victory for consumers subjected to form contracts because it held the parties accountable to only the terms that were explicitly negotiated and agreed on.

In ProCD, Inc. v. Zeidenberg, a buyer violated a software license that restricted use of the software to “noncommercial” activity only.³⁶ The buyer, Matthew Zeidenberg, claimed that the shrinkwrap license should not be valid because it did not appear on the outside of the packaging and the terms could only be viewed by opening and using the software.³⁷ However, Judge Frank Easterbrook treated the license like an ordinary contract for the sale of goods, concluding that Zeidenberg could validly assent by doing as ProCD had requested: opening and using the software.³⁸ Judge Easterbrook stated that consumers can generally assent through any means held out as a form of acceptance by the seller, with exceptions for a seller’s bad faith.³⁹ Judge Easterbrook used UCC § 2-204 to support the common law principle that a seller is the “master of the offer” who can invite and limit means of acceptance;⁴⁰ “[a] buyer may accept by performing the acts the vendor proposes to treat as acceptance.”⁴¹ Contracts can be formed in many ways and “ProCD proposed such a different way, and without protest Zeidenberg agreed.”⁴² Further, ProCD was reasonable in its proposed form of acceptance because even after the package was opened “the software splashed the license on the screen and would not let [the buyer] proceed without indicating acceptance.”⁴³ An important part of Judge Easterbrook’s decision was that the software incorporated a pop-up box containing the agreement terms, creating reasonable notice of the terms for the buyer.⁴⁴ Additionally, contrary to Judge Wisdom’s reasoning in Step-Saver, Judge Easterbrook determined that an option to return the product for a full refund added to the validity of the buyer’s assent (though interestingly, in a 2004 interview of Matthew Zeidenberg and attorney David Austin, Austin claimed that the deposition of ProCD President James Bryant had revealed that ProCD did not have an actual return policy).⁴⁵ Sellers and businesses embraced Judge Easterbrook’s decision and shrinkwrap licenses became “generally accepted” “[w]ithin six years” of the ProCD case.⁴⁶ Eric Posner wrote that Judge Easterbrook “reformulate[d] [the] offer-acceptance doctrine so as to permit enforcement of ‘terms later’ contracts, an important new business tool.”⁴⁷

In the wake of Step-Saver, ProCD came to represent a validation of the use of form contracts to conduct business. Judge Easterbrook stated that “[t]ransactions in which the exchange of money precedes the communication of detailed terms are common” and used the purchase of insurance as an example.⁴⁸ In a subsequent case, Hill v. Gateway 2000, Inc., Judge Easterbrook clarified that ProCD was not just limited to software and was about “the law of contract” in general.⁴⁹ Furthermore, “[p]ractical considerations support[ed] allowing vendors to enclose the full legal terms with their products.”⁵⁰ For example, cashiers could not “be expected to read legal documents to customers before ringing up sales.”⁵¹ Judge Easterbrook’s words feel especially relevant today given the fast-paced nature of commerce. Notably, and perhaps regrettably, ProCD did not set real standards for what sellers should actually include on packaging in order to create notice of agreement terms. The court may have declined to create bright-line requirements for notice out of fear that restrictions would interfere with a seller’s packaging.⁵² Nevertheless, since the 1990s, when Step-Saver and ProCD created a circuit split, both decisions have been highly influential in the development of online contract law.

2. Online Contracts Today

Like shrinkwrap contracts, online form contracts for the sale of goods or services require a manifestation of assent for an offeree to be bound by a seller’s nonnegotiable set of terms.⁵³ Clickwrap, browsewrap, scrollwrap, and sign-in-wrap agreements govern millions of transactions, drawing on the same common law principles as the shrinkwrap contracts in Step-Saver and ProCD. “While Internet commerce has exposed courts to many new situations, it has not fundamentally changed the requirement that ‘[m]utual manifestation of assent, whether by written or spoken word or by conduct, is the touchstone of contract.’ ”⁵⁴ Shrinkwrap agreements find a modern analogue in browsewrap agreements: neither shrinkwrap nor browsewrap requires an affirmative act of assent to specific terms to be binding. Like the buyer in Step-Saver who needed only to continue opening the package to accept the seller’s terms, a buyer subject to a browsewrap agreement need only to continue interacting with a website to accept a set of terms. There is no clear instruction to, for example, click a checkbox before making a purchase. Judge Wisdom might be skeptical of the validity of browsewrap because it might not be reasonable for a buyer to expect to be bound in such a way. Indeed, California courts are generally more inclined to rule for the validity of a clickwrap or a scrollwrap contract than a browsewrap contract because clickwrap and scrollwrap require an affirmative act, evincing that the buyer was more likely to be put on notice instead of passively clicking.⁵⁵

Because wrap agreements are contracts of adhesion that offer no opportunity for a buyer to negotiate, a buyer’s only choices are to assent and complete the transaction or to walk away. Karl Llewellyn theorized in The Common Law Tradition that “there is no assent at all” to the specific terms within a boilerplate agreement; instead, there is “a blanket assent” to all terms of the agreement.⁵⁶ In other words, buyers either assent to all the terms, or they do not. Thus, buyers accepting clickwrap contracts should not be construed as assenting to one provision or another, but rather as assenting to the seller’s entire agreement.

The “take-it-or-leave-it” nature of these contracts has potential to leave buyers stuck with terms they do not like. The court in Step-Saver considered the imbalanced nature of contracts of adhesion, reasoning that the seller may have been relying on the fact that the buyer had already invested time and energy into the transaction.⁵⁷ Some legal scholars, including Cheryl B. Preston, are skeptical about the ability of online contracts to be anything but one sided.⁵⁸ Buyers often fail to understand the terms to which they are assenting. Though it is a common law principle that whether a buyer has actually read a form contract is not dispositive of whether they will be bound, buyers who attempt to read the terms may find them inaccessible and full of legalese. A 2019 study by two law professors analyzed the sign-in-wrap contracts of 500 popular U.S. websites and found that 99% of them could be categorized as “unreadable.”⁵⁹

On the other hand, Judge Easterbrook might argue that form contracts do not leave buyers without options because the nature of a competitive market forces sellers to create favorable terms for buyers.⁶⁰ He wrote in his opinion for ProCD that “[c]ompetition among vendors, not judicial revision of a package’s contents, is how consumers are protected in a market economy.”⁶¹ Additionally, efficiency and convenience are important to online consumers, who are generally unwilling to complicate a transaction. Eric Posner uses the term “cognitive overload” to describe how buyers may be dissuaded if too much information is received up front.⁶² “If the seller conveys too much information, she will drive away buyers. If the seller conveys too little information, she will mislead buyers and possibly drive them away as well.”⁶³ Even minor setbacks in a checkout process can mean the difference between completing a purchase or not. Forbes reported that around twenty-five percent of online shoppers choose not to go through with a purchase if the website forces them to create a new account.⁶⁴ For certain customers, the risk of potential legal complications down the road is a fair substitute for simple and efficient online processes.⁶⁵

The validity of online form contracts often turns on whether the mode of acceptance created by seller-offerors adequately notifies buyers of the formation of an agreement on the seller’s terms. The theory behind notice is that it can level the playing field within the realm of online contracting. E. Allan Farnsworth notes that the “lack of equality between a person who is meticulous or who chances to have knowledge and a person who is blissfully unknowing is a patent point for dissatisfaction.”⁶⁶ Because there is always an inherent potential for unfairness when there is no real negotiation of terms, there should be an attempt to create awareness for the non-drafting party. This is a defining characteristic of clickwrap and browsewrap contracts, especially because the ubiquity of ecommerce means that they are accessible to the expert as well as the layperson. In Step-Saver, Judge Wisdom considered whether a “reasonable” buyer could expect to be notified of the seller’s priorities.⁶⁷ In ProCD, the conspicuousness of the seller’s pop-up notice box was an important factor in creating objective notice for the buyer.⁶⁸

It is challenging to synthesize a common standard for notice because clickwrap, browsewrap, scrollwrap, and sign-in-wrap can be nebulous categories. For example, courts frequently characterize contracts containing elements of both browsewrap and clickwrap as “hybridwrap.”⁶⁹ One example of hybridwrap is acknowledged by courts when “the button required to perform the action manifesting assent (e.g., signing up for an account or executing a purchase) is located directly next to a hyperlink to the terms and a notice informing the user that, by clicking the button, the user is agreeing to those terms.”⁷⁰ Hybridwrap may exist when users are reasonably notified of “the existence of the website’s terms of use” and are often guided to click a button to signify agreement.⁷¹ The case law survey in Part II shows that courts often struggle to categorize wrap agreements, and in lacking categorical rules to guide them, courts must look for adequate notice of the seller’s terms.

Additionally, as will be discussed at length in Section II.C.1, adequate notice has advantages and disadvantages as a legal standard. One advantage is that it allows room for evolution in response to the rapidly evolving digital world. Ecommerce is still growing, especially given the recent COVID-19 pandemic, during which many businesses and consumers relied on online orders. The global ecommerce market is expected to total $6.3 billion in 2024 and $7.9 trillion by 2027.⁷² Additionally, buyers today make online purchases faster and more casually than they have in the past. Consumers who make habitual and trivial purchases online may not be privy to a seller’s terms when, from the consumer’s perspective, the transaction is as inconsequential as a “pair of socks.”⁷³ Thus, not only are the means of business evolving, but the role and mindset of the consumer are changing as well. Courts have applied similar notice standards for the past three decades, but these standards can sometimes be a moving target.

C. Second and Ninth Circuit Decisions: Nguyen, Berman, and Specht

Major circuit court decisions from the past two decades show that courts often defer to sellers’ proposed modes of assent to their agreements while using a fact-based adequate notice standard to evaluate the validity of a wrap agreement.

In Nguyen v. Barnes & Noble Inc., a buyer unwittingly assented to Barnes & Noble’s terms of use through a browsewrap agreement while shopping online.⁷⁴ The disputed arbitration term could not be viewed unless the buyer clicked on a hyperlink that was placed at the bottom of the webpage.⁷⁵ Additionally, Barnes & Noble did not require any affirmative act of assent as part of the transaction.⁷⁶ The court held for the buyer and denied Barnes and Noble’s motion to compel arbitration.⁷⁷ The Nguyen court characterized online contracts as primarily coming in “two flavors”: “clickwrap” and “browsewrap.”⁷⁸ Browsewrap was defined as an agreement where “a website’s terms and conditions of use are generally posted on the website via a hyperlink at the bottom of the screen.”⁷⁹ Because browsewrap, unlike clickwrap, lacks an act of affirmative assent, the standard in Nguyen turned on “whether the user ha[d] actual or constructive knowledge.”⁸⁰ Thus, the buyer was not bound by the terms of use because he was not adequately put on notice by the design of the website and the inconspicuous and “buried” hyperlink to the terms and conditions.⁸¹ A rare bright-line rule for browsewrap emerged from this case:

[W]here a website makes its terms of use available via a conspicuous hyperlink on every page of the website but otherwise provides no notice to users nor prompts them to take any affirmative action to demonstrate assent, even close proximity of the hyperlink to relevant buttons users must click on—without more—is insufficient to give rise to constructive notice.⁸²

Few other notice-related bright-line rules have been articulated, but Nguyen represented a turning point in the world of online contracts, discouraging sellers from implementing browsewrap agreements without a buyer’s affirmative act of assent.

By 2021, scrollwrap and sign-in-wrap found their way into the lexicon of the courts, and California came to recognize four categories instead of the “two flavors” set forth in Nguyen.⁸³ The Ninth Circuit affirmed Nguyen in Berman v. Freedom Financial Network, in which a company’s terms and conditions were not conspicuous or noticeable on the website.⁸⁴ The terms were hyperlinked, but displayed in the same font and color as an adjacent sentence, not in the typical blue color a reasonable buyer would expect of a hyperlink.⁸⁵ The court held that the company did not call sufficient attention to the fact that clicking “continue” would indicate assent to the company’s terms, using a “reasonably conspicuous notice” standard to decide that the contract should be unenforceable.⁸⁶ Its fact-specific inquiry also assessed whether a “reasonably prudent Internet user” would be given notice given the webpage’s fonts, font sizes, colors, overall design, and readability of the webpage.⁸⁷ The court found that such a user would not be put on notice given that the hyperlink was not conspicuous in color or design.⁸⁸ This standard is consistent with Step-Saver, which looked to the reasonable beliefs of the parties in assessing notice.⁸⁹ Lastly, the Berman court provided a two-part framework for courts’ inquiries into notice:

Unless the website operator can show that a consumer has actual knowledge of the agreement, an enforceable contract will be found based on an inquiry notice theory only if: (1) the website provides reasonably conspicuous notice of the terms to which the consumer will be bound; and (2) the consumer takes some action, such as clicking a button or checking a box, that unambiguously manifests his or her assent to those terms.⁹⁰

Berman is a recent case, and lower courts have generally been slow to adopt this exact two-part framework. As will be discussed in Part II, courts take—and have taken—a variety of approaches to conduct similar notice inquiries. ⁹¹

In Oberstein v. Live Nation Entertainment, Inc., the Ninth Circuit considered another factor when assessing notice: the expectation of a continued relationship with a seller.⁹² A ticketing company’s website presented users with buttons that read “you agree to our Terms of Use” at three independent stages: creating an account, signing into an account, and completing a purchase.⁹³ The court considered both “the context of the transaction” and the “placement of the notice.”⁹⁴ Because the context of the transaction required full registration and implied somewhat of a “continuing relationship,” users should have been notified of the terms of that relationship.⁹⁵ Thus, the court ruled for the ticketing company and added a new dimension to the adequate notice standard.⁹⁶

Keebaugh v. Warner Bros. Entertainment Inc., a 2024 Ninth Circuit case, further clarified the standard set forth in Berman.⁹⁷ On a mobile entertainment app, users were presented with a large button that read “Play,” and small text below the button that read “By tapping ‘Play,’ I agree to the Terms of Service.”⁹⁸ Using both the Berman two-part inquiry and the “context” standard from Oberstein, the court categorized the agreement as sign-in-wrap and ruled for the entertainment company.⁹⁹ The court defined the “conspicuous” notice part of the Berman standard as “displayed in a font size and format such that the court can fairly assume that a reasonably prudent Internet user would have seen it.”¹⁰⁰ Additionally, “[s]imply underscoring words or phrases . . . will often be insufficient to alert a reasonably prudent user that a clickable link exists.”¹⁰¹ In terms of a continuing relationship between company and user, the court emphasized that the context of downloading a mobile app carries an implication of long-term use.¹⁰² Again, as demonstrated in Part II, courts in California have yet to latch onto the Berman standard. Courts have been using—and continue to use—similar, but not identical, standards.

New York law and California law often “dictate the same outcome” and draw from the same precedent.¹⁰³ The jurisdictions frequently exchange standards and reference the same lines of reasoning for cases considering the validity of an online contract. Further, other U.S. Courts of Appeal frequently apply California contract law as well.¹⁰⁴ In the 2002 Second Circuit case Specht v. Netscape Communications Corp., then-Judge Sotomayor applied California law in denying a software company’s motion to compel arbitration after a buyer was unaware of the terms of the contract.¹⁰⁵ In circumstances where consumers are “urged to download free software,” “clicking on a download button does not communicate assent to contractual terms” without adequate notice.¹⁰⁶ Judge Sotomayor used a “reasonably prudent offeree of downloadable software” standard in determining whether it would be reasonable to conclude that the buyer should have been aware of the terms.¹⁰⁷ Like Judge Wisdom in Step-Saver and the Ninth Circuit in Berman, Judge Sotomayor examined the belief of the parties in determining that a “reasonably prudent offeree in plaintiffs’ position would necessarily have known or learned of the existence of the SmartDownload license agreement.”¹⁰⁸ She held that “a reference to the existence of license terms on a submerged screen is not sufficient to place consumers on inquiry or constructive notice of those terms.”¹⁰⁹ Finally, Judge Sotomayor also distinguished the facts of Specht from the facts of ProCD, in which the buyer “was confronted with conspicuous, mandatory license terms every time he ran the software on his computer.”¹¹⁰ However, she also noted that cases such as ProCD “do not help defendants” and emphasized the necessity of reasonably conspicuous notice “if electronic bargaining is to have integrity and credibility” going forward.¹¹¹

In 2017, the Second Circuit decided Meyer v. Uber Technologies, Inc., an influential case among a slew of recent rideshare-related contract cases. The court held that a consumer unambiguously manifested assent to Uber’s terms of service because a reasonable user would have seen and known that clicking a registration button would constitute assent to terms accessible via hyperlink.¹¹² Even though the sign-in-wrap agreement served two functions—“creation of a user account and assent to the Terms of Service”—the consumer’s assent was still valid given the “physical proximity of the notice to the register button and the placement of the language in the registration flow.”¹¹³ Interestingly, the court seemed to prioritize the creation of notice over the type of wrap in dispute. The court stated that “[c]lassification of web-based contracts alone . . . does not resolve the notice inquiry.”¹¹⁴ In this case, the user was bound because they were “expressly warned . . . that by creating an Uber account, the user was agreeing to be bound by the linked terms.”¹¹⁵

In general, Nguyen, Berman, Oberstein, Keebaugh, Specht, and Meyer show that courts must consider notice standards within the reality of the Internet and recognize the necessity of electronic form contracts to conduct ecommerce. Finding a balance between a consistent standard for sufficient notice and offeror efficiency, however, has proven to be challenging. Courts have issued very few bright-line requirements for offerors and generally take an “ex ante approach by emphasizing what the drafter should have done to make the terms prominent and noticeable.”¹¹⁶ This approach might be criticized as reactive and too deferential to sellers, who are in a better position to create awareness of their terms because they can exercise more control over a buyer’s experience by designing the website.

Indeed, the common law principle that the offeror remains the “master” of the offer holds true in the realm of online form contracts. However, cases like Berman and Specht also highlight more buyer-centric common law principles, accounting for the reasonable expectations of the average “prudent” buyer. A dominant standard has not yet been established by the Ninth Circuit, and California law encompasses both the “reasonable notice” and the “reasonably prudent” user standard. Thus, this Note’s case law survey attempts to analyze and identify how California courts utilize these flexible standards of notice to analyze buyers’ acceptance of sellers’ offers.

II. CASE LAW SURVEY

This survey examines state and federal district court cases to paint a picture of California courts’ treatment of wrap agreements. Section II.A focuses on California state courts and discusses notable cases within the context of Step-Saver, ProCD, Nguyen, and Specht. It concludes that clickwrap agreements remain presumably enforceable, browsewrap agreements require a more fact-specific inquiry, and sign-in-wrap agreements are not yet fully distinguishable from browsewrap agreements. Section II.B focuses on the ways in which cases in federal district courts in California are consistent or inconsistent with cases in state courts. Section II.B concludes that district court decisions are largely in line with state court decisions, factoring in scrollwrap cases as presumptively enforceable. Finally, Section II.C further analyzes and summarizes differences between the forums and comments on the lasting influence of Step-Saver and ProCD. Overall, this case law survey shows that standards of notice from both Step-Saver and ProCD have been incorporated into California law, but a predominant standard for assessing adequate notice for wrap contracts has yet to take hold.

Twenty California state court cases and twenty U.S. District Court cases involving online form contracts for the sale of goods or services were chosen for this survey as a representative sample. This Note provides a brief quantitative analysis, then a substantive qualitative analysis of cases in each group. There were two main reasons for conducting a more comprehensive qualitative analysis: (1) the reasoning in the following cases was often fact specific, especially when the agreements in question defied easy categorization; and (2) although the chosen cases are representative of recent decisions, many similar cases exist beyond what is depicted here. It should be noted that some cases surveyed involved multiple types of wrap, or contained agreements that could have plausibly been categorized in more than one way. Importantly, the cases in this survey were sorted by the courts’ own labels and characterizations for the wrap agreements in dispute.

Additionally, as discussed in Section I.B.2, the clauses most frequently in dispute—arbitration clauses, choice-of-forum clauses, and class-action waiver clauses—are small parts of long agreements.¹¹⁷ As per Llewellyn’s theory of “blanket assent” to terms in a boilerplate contract,¹¹⁸ courts consider the validity of entire contracts rather than specific provisions. Thus, the cases in this survey generally either enforced the validity of an agreement or found the agreement to be invalid as a whole.

Figure 1. Outcomes of Cases Included in Case Law Survey

A. California State Courts

Cases were chosen based on the following criteria: (1) cases arose out of California state courts; (2) cases were decided between the years 2014 and 2024 (inclusive); (3) the relationship between the parties to the case was that of a buyer and seller (or lessee/lessor), or the agreement in dispute arose out of a transaction for goods or services; and (4) the court addressed the validity of a clickwrap, browsewrap, scrollwrap, or sign-in-wrap contract. Interestingly, there have not yet been any cases concerning the validity of a pure scrollwrap agreement in this jurisdiction. This Note will not include substantial speculation as to how state courts might treat scrollwrap agreements, but the latter half of this case law survey involving federal cases will discuss how California state law is applied to scrollwrap. Generally, scrollwrap agreements appear to be more or less unanimously enforceable.¹¹⁹

Most of the selected cases involved disputes regarding forum-selection clauses and arbitration clauses, however, the nature of the disputed terms was of secondary importance because courts only consider whether the entire agreement is valid. It should be noted that the Federal Arbitration Act (“FAA”) generally treats the enforcement of arbitration agreements favorably.¹²⁰ However, the FAA also limits the role of the courts to two related inquiries: (1) “whether a valid arbitration agreement exists,” and (2) “whether the agreement encompasses the disputes at issue.”¹²¹ Online contract cases often turn on the first issue, as the second issue is typically less disputed by the parties. Thus, the court’s inquiry was often whether a valid contract—and therefore, a valid arbitration agreement—existed.¹²²

Of the twenty cases examined, nine cases involved clickwrap agreements, eight cases involved browsewrap, and four cases involved sign-in-wrap (one case involved both a browsewrap agreement and a sign-in-wrap agreement).¹²³ Seven of nine clickwrap cases held for the seller, three of eight browsewrap cases held for the seller, and two of four sign-in-wrap cases held for the seller.¹²⁴ The numeric breakdown of the case outcomes was secondary to the reasoning of the courts. In general, the courts found clickwrap contracts largely enforceable, barring unique circumstances with extraneous issues. Browsewrap agreements were examined more closely, and the courts were more inclined to prioritize fact-based notice inquiries in such cases, echoing Berman and Specht. Cases involving sign-in-wrap were less unified by a single standard, and Sellers v. JustAnswer LLC highlighted some of the inconsistencies and issues with the various standards set forth by state and federal courts. Overall, although the reasoning of the courts closely followed Ninth and Second Circuit precedent, the standards for notice were inconsistently applied, even within wrap categories.

1. Clickwrap Agreements

As the Ninth and Second Circuits have noted, courts often presume clickwrap agreements to be enforceable because buyers must affirmatively manifest assent to the terms in question by physically clicking to proceed with an online transaction.¹²⁵ This is consistent with the Berman standard, but of the cases decided after Berman, none used the two-part framework. Overall, the courts generally presumed the validity of clickwrap and occasionally looked for adequate notice.

The cases surveyed revealed that a notice inquiry was secondary to the presumption of enforceability of pure clickwrap agreements. For example, it typically did not matter what was written on the digital button or box that users were directed to click; the action of clicking was enough of an affirmative act to bind the user. In B.D. v. Blizzard Entertainment, Inc., a buyer clicked a button marked “Continue” and was bound by a seller’s License Agreement.¹²⁶ The button was accompanied by a pop-up notice that notified buyers that continuing with the transaction would manifest assent.¹²⁷ In Pierre v. Dexcom Inc. and Jackson v. Vines, the court declared that clickwrap agreements are “generally considered enforceable.”¹²⁸

Courts were less likely to presume that clickwrap agreements were enforceable if they found elements of other wrap agreements present in a seller’s website flow. Two clickwrap cases held for buyers. The first case is Doe v. Massage Envy Franchising, LLC, in which a buyer did not assent to a seller’s terms of service on an in-store electronic tablet because the font color of the statement of notice was not conspicuous, and the terms were hyperlinked, not plainly visible.¹²⁹ The seller motioned to compel arbitration after the buyer alleged that she was sexually assaulted at the seller’s franchise location.¹³⁰ The court emphasized that the buyer was under pressure to complete the forms quickly by seller’s staff, which factored into the assessment of whether the buyer was actually aware of the terms.¹³¹

The second case in which a buyer prevailed is Herzog v. Superior Court. In Herzog, a healthcare company prompted users to assent to its terms of use before using a glucose monitoring app.¹³² The agreement appeared to be “classic ‘clickwrap,’ ” prompting a user to click a box stating: “I agree to Terms of Use.”¹³³ However, merely “categorizing the purported agreement as a clickwrap [did] not resolve the formation question.”¹³⁴ The court looked for “reasonably conspicuous notice” of the existence of terms to which users would be bound—specifically, the idea that “the content of [the app’s] ‘Legal’ screen support[ed] the inference that the user’s action on that screen—here, clicking the checkbox—constituted an unambiguous manifestation of assent to those terms.”¹³⁵ The company’s notice did not suggest assent; it read: “By ticking the boxes below you understand that your personal information, including your sensitive health information, will be collected, used and shared consistently with the Privacy Policy and Terms of Use.”¹³⁶ The court concluded that a reasonably prudent user would fail to understand the relationship between the Terms of Use, the Privacy Policy, and the company’s data collection.¹³⁷ Furthermore, users were confused by the fact that the company’s app was not necessary to use its glucose monitoring technology.¹³⁸ Herzog can be distinguished from other cases in this survey because it involved clickwrap pertaining to multiple sets of terms and services. Nevertheless, Massage Envy and Herzog both provide interesting points of contrast to the general presumption that clickwrap creates a valid agreement.

Overall, with a couple exceptions, courts viewed clickwrap agreements as largely enforceable, sometimes presumptively so.

2. Browsewrap Agreements

California State courts were generally protective of buyers confronted with browsewrap agreements but were inconsistent in their applications of standards of notice. In 2014, the Ninth Circuit wrote that it was “more willing to find the requisite notice for constructive assent where the browsewrap agreement resemble[d] a clickwrap agreement—that is, where the user is required to affirmatively acknowledge the agreement before proceeding with use of the website.”¹³⁹ Following Nguyen and Berman, pure browsewrap agreements became rare; offerors began to require more from consumers using their websites in order to indicate assent to their terms.

When confronted with hybridwrap or browsewrap agreements, courts largely adhered to the precedent set by three main decisions applying California law to facts involving browsewrap agreements: Nguyen, Specht, and Long v. Provide Commerce Inc.¹⁴⁰ In Long, a flower seller’s checkout flow did not create adequate notice that placing an order indicated a buyer’s acceptance, nor did a link sent to the buyer’s email create notice of the seller’s terms.¹⁴¹ Because browsewrap agreements require no affirmative action, “absent actual notice, ‘the validity of [a] browsewrap agreement turns on whether the website puts a reasonably prudent user on inquiry notice of the terms of the contract.’ ”¹⁴² The court examined whether the conspicuousness of the hyperlinks and design elements of the seller’s website would put a reasonably prudent user on notice.¹⁴³ In dicta, the court agreed with the Nguyen court; simply displaying a hyperlink without further notice is likely not enough to “alert a reasonably prudent Internet consumer to click the hyperlink.”¹⁴⁴

But not all courts applied these notice standards in the same way, and some courts were more concerned with buyer protections than others. Drawing from Long and Nguyen, Kellman v. Honest Co. looked for “something more” in addition to a seller’s browsewrap agreement that would put a reasonably prudent buyer on notice.¹⁴⁵ The court found that while a hyperlink and notice of the seller’s terms were not buried on the webpage, “they were in small print of a lighter color” and were “surrounded by text that did not suggest that the hyperlink was important.”¹⁴⁶ The court also emphasized the “realities of internet marketing and use,” citing Judge Sotomayor’s reasoning in Specht, and stressed that notice of a seller’s terms is essential to the “integrity and credibility” of online contracting and the ecommerce industry.¹⁴⁷ Because sellers are aware that very few buyers read terms of use, some sellers “design their websites to take advantage of consumer inattention.”¹⁴⁸ The court also cited Woodrow Hartzog who coined the phrase “malicious interface” to describe websites that deceive consumers.¹⁴⁹ It is a common law principle that parties should be bound to contracts that they enter into. But Kellman and Specht may suggest that unwitting assent is not assent at all.¹⁵⁰ These concerns are reminiscent of the Step-Saver court’s suggestion that sellers might take advantage of buyers’ reluctance to return a product if they dispute the terms of a shrinkwrap agreement.¹⁵¹

A few cases in the study attempted to provide definitions for various types of browsewrap and utilize appropriate standards of notice. Rabbani v. Tesla Motors described “pure-form browsewrap agreement[s]” as follows: “by visiting the Web site—something that the user has already done—the user agrees to the Terms of Use not listed on the site itself but available only by clicking a hyperlink.”¹⁵² Esparza v. 23andMe Inc. emphasized that an agreement is browsewrap if the offeror “assumes assent based upon the mere use of the website.”¹⁵³ “Website users are entitled to assume that important provisions—such as those that disclose the existence of proposed contractual terms—will be prominently displayed, not buried in fine print.”¹⁵⁴

Generally, when browsewrap agreements contained elements of clickwrap, they were more likely to be enforceable. This was due to the creation of “reasonable notice” through the affirmative act of clicking. Even when terms were hyperlinked or not immediately noticeable, website flows that incorporated an affirmative act on the part of the buyer were enforceable. In Collins v. Priceline, a website’s terms were only visible via a hyperlink but were enforced by the court because the buyer had adequate notice that “[b]y selecting Confirm Your Reservation [they] agree[d] to the Booking Conditions.” ¹⁵⁵ The affirmative act of clicking to move forward with the reservation resembled clickwrap enough for the court to hold the buyer to the terms.¹⁵⁶ Esparza and Collins were consistent with the Berman standard in that they emphasized the importance of an affirmative act, but Esparza did not apply the Berman framework, despite being decided in 2023.

Esparza also used a reasonably prudent user standard to determine whether a buyer had “adequate or constructive notice.” The court examined factors that the Nguyen and Long courts examined, such as “ ‘placement,’ color, and contrast of hyperlinks (i.e., ‘color-contrasting text’) and ‘the website’s general design.’ ”¹⁵⁷ The court in Rabbani v. Tesla Motors, Inc. also mentioned the reasonably prudent user standard but based its determination on the presence of “immediately visible notice,” quoting Specht.¹⁵⁸ Thus, although these cases used many similar standards of notice, they were inconsistent in their approaches to finding reasonable notice.

Overall, the courts were most protective of buyers in cases involving browsewrap agreements, unless the agreements involved an affirmative act of assent. The greater amount of inconsistency was likely due to the variation in what browsewrap agreements look like. Thus, courts looked for elements that resembled clickwrap, leaning on its presumptive enforceability. Courts also used a reasonably prudent user standard to determine whether reasonable notice was present, but there was no predominant standard among browsewrap cases.

3. Sign-In-Wrap Agreements

Sign-in-wrap resembles browsewrap in that it can cause a buyer—who believes they are merely signing up for an account or email list—to unwittingly assent to terms. But sign-in-wrap can also resemble clickwrap in that it can incorporate an affirmative act of assent into the sign-up flow. Courts generally struggled with a consistent treatment for sign-in-wrap and used several standards from browsewrap cases such as the reasonable notice and the reasonably prudent user standard.

A California appellate court was confronted with the issue of a sign-in-wrap agreement for the first time in 2021 in the case Sellers v. JustAnswer LLC.¹⁵⁹ A question-answering website prompted users with a button that read: “Start my trial” and small text below that read: “By clicking ‘Start my trial’ you indicate that you agree to the terms of service and are 13+ years old.”¹⁶⁰ Although the court noted that sign-in-wrap should be enforceable “based on the existence of essentially any textual notice that purports to inform consumers they agree to the terms by signing up for an account,” the court decided that the website’s notice was not “clear and conspicuous,” and the agreement was unenforceable.¹⁶¹ The Sellers court used a reasonableness standard to determine that the website’s notice was insufficient.¹⁶² The factors identified in Nguyen and Long (including text size, text color, text location, proximity to clickable buttons, obviousness of hyperlinks, and “clutter” on the screen) provided a baseline for the factual inquiry.¹⁶³ Additionally, the fact that the user was signing up for a free trial of a service and was not expecting to enter into an ongoing contractual relationship contributed to the lack of conspicuousness.¹⁶⁴ The court quoted Long: “California law is clear—‘an offeree, regardless of apparent manifestation of [their] consent, is not bound by inconspicuous contractual provisions of which [they were] unaware, contained in a document whose contractual nature is not obvious.’ ”¹⁶⁵ This set the stage for Oberstein, which solidified the “context” of a transaction standard that has yet to be embraced.¹⁶⁶

Sellers is also notable for its focus on how an average user or consumer behaves, echoing parts of the opinion from Step-Saver. While the defendant-seller urged the court to set bright-line rules governing sign-in-wrap agreements, the court declined to do so.¹⁶⁷ This was also the case in ProCD, in which Judge Easterbrook did not create specific requirements for sellers’ packaging out of fear of stifling business. The Sellers court commented on trends in online form contracting law, observing that courts have been inconsistent in their conceptualizations of a “typical online consumer.”¹⁶⁸ The court declared that “not all internet users are alike”;¹⁶⁹ some federal courts assume that “ ‘[a]ny reasonably-active adult consumer will almost certainly appreciate that by signing up for a particular service, he or she is accepting the terms and conditions of the provider.’ ”¹⁷⁰ Other Internet users might have “only recently, and perhaps begrudgingly, began to use cell phones, or other internet-enabled devices, for the purpose of online commerce.”¹⁷¹ Thus, federal courts have been inconsistent in their treatment, relying on “subjective criteria” as opposed to the aforementioned factors.¹⁷² An example is a court treating “conspicuousness” as the relevant question of law when it is “actually conducting . . . a fact-intensive inquiry.”¹⁷³ The Sellers court zoomed into the reasonably prudent user standard employed by many courts, setting the stage for Keebaugh.¹⁷⁴

Following the lead of Sellers, other sign-in-wrap cases in the case law survey did not establish or utilize a single standard. Instead, the cases likened sign-in-wrap agreements to browsewrap agreements and applied a broader “actual or constructive notice” standard. In Thompson v. Live Nation Entertainment, for example, the court emphasized the fact that a buyer received more than one opportunity to acknowledge a seller’s Terms of Use, and the use of a different font color for the terms created adequate notice.¹⁷⁵ On one hand, these are commonly examined factors within a notice inquiry. On the other hand, the courts’ decisions about which factors to examine were seemingly arbitrary.

The other case besides Sellers that held for a buyer was O’Connor v. Road Runner Sports, Inc., which turned on the fact that the buyer did not manifest assent because he did not use one of the modes of acceptance established by the seller.¹⁷⁶ The terms and conditions of the loyalty program provided “three ways a customer could manifest his or her assent to be bound: purchasing a membership, using a membership, or renewing a membership.”¹⁷⁷ Instead, the buyer called the seller’s toll-free phone line, so he did not agree to the seller’s terms.¹⁷⁸ As per common law, the offeror is the master of the offer, and in this case, the offeree did not undertake any of the modes of acceptance held out by the offeror.

Given the Sellers decision, California courts have not yet settled on a singular standard for determining whether a sign-in-wrap agreement is enforceable because they have taken varied approaches to assessing adequate notice. Further, Sellers casts doubt on courts’ adherence to so-called objective standards of notice. As the case law survey shows, courts have instead been using somewhat free-flowing, fact-based criteria.

In conclusion, California state courts were relatively consistent in presuming clickwrap agreements to be enforceable but were inconsistent in employing uniform standards of notice in browsewrap and sign-in-wrap cases. Part of the issue was the inability to define certain browsewrap agreements that did not fit cleanly into a single wrap category. Another issue, however, was the courts’ inconsistent application of standards, through which they examined a variety of factors to assess reasonable notice and sometimes relied on a reasonably prudent user or context of the transaction standard. These standards were somewhat selectively employed by the courts in the surveyed cases, which still showed deference to the presumptive enforceability of some agreement types over others.

B. U.S. District Courts in California

This Note examined twenty cases to provide a point of comparison to the state court case survey and to show that recent federal cases in California reach conclusions largely consistent with those of the state courts. Mirroring the state court case law survey, federal cases were chosen based on four criteria: (1) cases arose out of U.S. District Courts from districts in California; (2) cases were decided between the years 2014 and 2024 (inclusive); (3) the relationship between the parties to the case was that of a buyer and seller (or lessee/lessor), or the agreement in dispute arose out of a transaction for goods or services; and (4) the court addressed the validity of a clickwrap, browsewrap, scrollwrap, or sign-in-wrap contract. While the state court case law survey yielded no instances of scrollwrap contracts, this part of the survey will analyze four cases involving scrollwrap, finding that the courts’ conclusions were unsurprising and consistent with the former half of the case law survey. Again, the types of provisions in dispute in these cases were not relevant because the agreement was considered as a whole. Indeed, most of the selected cases involved disputes regarding forum-selection clauses and arbitration clauses.

Three cases contained discussions of the validity of clickwrap agreements, three contained scrollwrap, nine contained browsewrap, and seven contained sign-in-wrap (two browsewrap cases also contained aspects of sign-in-wrap).¹⁷⁹ In each of the cases involving clickwrap or scrollwrap, the court held for the seller. In the browsewrap cases, the court held for the seller in six out of nine instances. In the sign-in-wrap cases, the court held for the seller two out of five times. The ratio of pro-buyer and pro-seller decisions for each type of wrap were not drastically different from those in state courts (see Figure 1, supra). More important than these numbers, however, was the consistency found in the reasoning within the decisions.

The cases largely adhered to the general standards established by pre-Berman Ninth Circuit precedent. Some courts modeled their analysis on the facts of past cases. For example, in Friedman v. Guthy-Renker, the Central District Court of California closely followed the blueprint established in Nguyen in order to determine the validity of a browsewrap agreement.¹⁸⁰ In Peter v. Doordash, Inc., the court compared the actual webpage in question to the webpage in Meyer v. Uber Technologies.¹⁸¹ As was the case in state courts, it still remains to be seen whether the two-part test from Berman or the context of a transaction test will gain traction over time. Cases concerning scrollwrap agreements came out as expected; courts ruled for sellers because scrolling generally constituted an affirmative act of assent. When considering the enforceability of browsewrap or hybridwrap agreements, federal courts favored sellers slightly more than state courts. But overall, these decisions were unsurprising and largely consistent with California state courts.

1. Clickwrap Agreements

The courts followed a deferential presumption of validity when it came to pure clickwrap agreements, and referenced recent decisions in state or other federal courts. In Vanden Berge v. Masanto, the court noted that “[c]lickwrap agreements ‘have been routinely upheld by circuit and district courts.’ ”¹⁸² In Tingyu Cheng v. Paypal, Inc., the court declared that “[c]lickwrap agreements are routinely recognized by courts and are enforceable . . . .”¹⁸³ Determining that an agreement was identifiably clickwrap often ended a court’s inquiry into the agreement’s enforceability. As in state courts, notice was secondary to the presumption of validity.

Overall, there were no federal district court decisions concerning clickwrap that deviated from precedent. As was true in California state court cases, pure clickwrap agreements are still regarded as constituting an affirmative act of assent that binds a buyer.

2. Scrollwrap Agreements

The same consistency was true of cases involving scrollwrap agreements. Like pure clickwrap agreements, scrollwrap requires an affirmative act of assent through the action of physically scrolling down a webpage. However, scrollwrap arguably creates greater notice for a buyer because the entirety of the seller’s terms is built directly into the website flow. When the buyer is forced to acknowledge the entirety of the agreement, it is harder to argue that the buyer did not receive adequate notice. Generally, the discussions of the validity of pure scrollwrap agreements were not accompanied by fact-specific inquiries into the reasonableness of the notice.¹⁸⁴ Courts were simply willing to accept the reasoning found within other binding or persuasive precedent once the type of wrap was established. In 2023, the court in Flores v. Coinbase declared that “ ‘scrollwrap’ agreements are consistently found to be enforceable in California,” referencing Sellers.¹⁸⁵ In Perez v. Bath & Body Works, the court cited the Ninth Circuit in Berman, stating that there is “little doubt” as to the blanket enforceability of scrollwrap agreements because “they affirmatively show the terms to the user before obtaining assent rather than linking to a separate page containing the terms that does not need to be viewed prior to agreement.”¹⁸⁶

Though California state courts have not yet decided any scrollwrap cases, it is likely that those courts would reach similar conclusions. Of all the types of wrap, scrollwrap probably creates the greatest presumption of validity because it requires an affirmative act, and the terms are conspicuous and accessible, by definition.

3. Browsewrap Agreements

In contrast, courts were generally more skeptical of browsewrap agreements because of the passive nature of browsewrap. Some courts even expressed a presumption of invalidity for pure browsewrap agreements.¹⁸⁷ In Brooks v. IT Works Marketing, the court stated that “[i]nternet contracts fall on two ends of a spectrum; courts routinely find clickwrap agreements enforceable but are generally more reluctant to enforce browsewrap agreements.”¹⁸⁸ Moyer v. Chegg quoted Berman: “Courts are more reluctant to enforce browsewrap agreements because consumers are frequently left unaware that contractual terms were even offered, much less that continued use of the website will be deemed to manifest acceptance of those terms.”¹⁸⁹ As the court reasoned in Nguyen, a buyer is not expected to seek out the terms of an agreement and sellers should be responsible for providing notice.¹⁹⁰ Of the cases surveyed, when cases involved a pure browsewrap agreement that contained no elements of clickwrap or sign-in-wrap, the court ruled in favor of the buyer.¹⁹¹ This is consistent with the former part of the case law survey.

Courts’ inquiries became more complicated when browsewrap was combined with elements of clickwrap or sign-in-wrap. Notice of the terms of the agreement was almost always the standard, and courts again examined various factors.¹⁹² In some of the cases examined, the courts did not even deem it necessary to categorize a website as offering one of the four recognized types. Eight out of nine browsewrap cases examined involved a form of hybridwrap, and given the variation in those agreements, the courts utilized a fact-specific inquiry across the board.

Reasonable notice or reasonably prudent user standards were most common. In Friedman v. Guthy-Renker, the court looked for “browsewrap that resemble[d] a clickwrap” because such an agreement would require an affirmative act of assent, evincing notice.¹⁹³ Applying the reasonably prudent user standard adapted from Nguyen, the court held for one of the plaintiff-buyers and found that “a reasonably prudent person would not believe that the common noun ‘terms’ associated with the checkbox [were] the same terms found in the proper noun ‘Terms & Conditions’ at the bottom of the page.”¹⁹⁴ Similarly, in Chien v. Bumble, a “blocker card contain[ed] aspects of both clickwrap and browsewrap agreements” and was “comparable to a pop-up screen in that users must click ‘I accept’ before they may proceed” but needed to click a hyperlink to view the full terms.¹⁹⁵ However, the notice was “reasonably conspicuous,” and the agreement was therefore valid.¹⁹⁶

In Shultz v. TTAC Publishing, a hybrid browsewrap agreement was invalidated because the checkbox next to the statement, “I agree to the terms and conditions,” was already checked by default when a customer navigated to the checkout page; therefore, there was no affirmative act of assent.¹⁹⁷ Nevertheless, the court engaged in a factual inquiry as to whether there was sufficient notice to justify the browsewrap agreement, finding that “the webpage design [made] it exceedingly difficult to discern the significance of the hyperlink.”¹⁹⁸ As was true in state courts, federal courts in California routinely applied similar, yet not identical, standards for notice. In a way, it did not matter that each of these cases involved browsewrap because the courts did not assign much inherent meaning to the category. The importance of browsewrap as a distinct category eroded in the face of many distinct types of hybridwrap.

In one sense, these cases validate the observation of the Sellers court: federal courts have relied on “subjective criteria” as opposed to one consistent version of a reasonable notice standard.¹⁹⁹ That being said, the courts consistently drew from the same pool of examinable factors in evaluating whether adequate notice was given, including fonts, sizes, colors, and proximity to clickable buttons. Generally, like the cases surveyed in Section II.A, federal courts in California preferred to draw on multiple factors and standards used by precedent in assessing notice. A singular, objective standard of reasonable notice thus remains elusive.

4. Sign-In-Wrap Agreements

Like state court cases, federal cases involving sign-in-wrap agreements involved a fact-specific inquiry into the buyer’s experience and did not place much inherent value on the sign-in-wrap category. A fact-based inquiry was typically warranted. Serrano v. Open Road Delivery Holdings cited Sellers, stating,

[I]t is not apparent that the consumer is aware that they are agreeing to contractual terms simply by clicking some other button. Instead, the consumer’s assent is largely passive, and the existence of a contract turns on whether a reasonably prudent offeree would be on inquiry notice of the terms at issue.²⁰⁰

The webpage should have provided “conspicuous notice to permit an inference that the user had manifested assent.”²⁰¹ The court held for the consumer and found that notice was not conspicuous because of the small size of the text informing consumers that they were assenting to the terms of use by signing up.²⁰²

Courts employed a few other means of assessing notice. In addition to performing a broader factors-based inquiry, the court in Peter v. Doordash directly compared a seller’s sign-up page to the page considered by the Second Circuit in Meyer v. Uber Technologies.²⁰³ The court stated that “[t]he screens are similarly uncluttered and wholly visible, and the notice text appears even closer to the sign-up button on DoorDash’s page than on Uber’s.”²⁰⁴ In addition to using a more general standard, the court relied on a side-by-side comparison of two webpages.²⁰⁵ Lastly, the court in Regan v. Pinger declined to settle on a precise label for the sign-in-based agreement and instead looked for broadly “sufficient notice to manifest mutual assent,”²⁰⁶ as was true for some browsewrap cases as well.

Overall, sign-in-wrap cases in federal district courts also applied standards of reasonable notice in an inconsistent manner. Courts employed various techniques, including comparing the webpage in question to webpages from past cases and examining website elements, such as fonts, separately. These cases support the Sellers court’s criticism of the inconsistent application of notice standards in federal courts.

In conclusion, this case law survey reveals consistency with California state courts. Beyond the presumptions of validity for clickwrap and scrollwrap contracts, standards of notice generally became nebulous as courts utilized any combination of website factors as well as other methods such as direct comparisons to websites from previous cases. Both state and federal courts struggled to pinpoint a consistent method of assessing whether reasonable notice was present, and even the reasonably prudent user standard yielded different results depending on how the court chose to define an average user. Thus, federal courts in California were largely consistent with state courts in their treatment of clickwrap, scrollwrap, browsewrap, and sign-in-wrap cases.

C. Summary of Findings

To summarize, this case law survey shows consistency among state and federal courts in California. Courts were generally deferential to sellers and their offers if adequate notice was given to the buyer. This aligns with Judge Easterbrook’s perspective in ProCD. However, California courts also employed a reasonably prudent user standard, which can be traced back to Berman, Specht, and Step-Saver. Finally, this Note concludes by arguing that Step-Saver and ProCD remain relevant as online contracts evolve because they establish and contextualize the most commonly used standards of notice in California. Courts will likely continue to lean on their reasoning in applying common law principles as new types of contracts emerge over time.

1. Standards of Notice

In some clickwrap and scrollwrap cases, courts were willing to declare an agreement valid solely because courts have presumed clickwrap and scrollwrap to be enforceable in the past.²⁰⁷ On the other hand, some courts seemed reluctant to rely on categories at all.²⁰⁸ However, most cases in the case law survey engaged in some level of fact-specific inquiry, and a few main standards were seen most frequently. It remains to be seen whether the two-part standard from Berman or the transactional “context” standard from Oberstein will gain traction in the coming years.

The reasonable notice standard was almost always applied throughout the case law survey. Consistent with the precedent set by Nguyen, Specht, and Berman, courts examined various website design factors such as font size, font color, proximity to clickable buttons, underlining on hyperlinks, and the presence of an affirmative act of assent before completing a transaction.²⁰⁹ Though Nguyen provided some specific rules pertaining to browsewrap,²¹⁰ there is still no requirement that courts examine certain factors or website elements. Perhaps this approach is practical considering the wide variation in sellers’ website flows. However, the looseness of the standard was also a source of inconsistency throughout the survey, and courts created their own interpretations by picking and choosing certain factors to examine.²¹¹

The reasonably prudent user standard was often used with the reasonable notice standard and acted as a loose benchmark for courts analyzing the experience of a consumer engaging with a seller’s interface. Some courts treated it as an independent standard,²¹² while some courts treated is as a subset of reasonable notice.²¹³ The court in Sellers criticized some courts’ exercise of the reasonably prudent user standard as being too subjective and inconsistent.²¹⁴ In considering the potential longevity of this standard, it is difficult to imagine whether the average Internet user of the future will be more or less prudent. Perhaps the average American will be more digitally literate in twenty or fifty years than they are today. Or perhaps technology will continue to evolve, leaving some generations and users behind. Nevertheless, it is certain that sellers and their offers will continue to evolve, causing standards to continue to adapt.

A few other methods of assessing notice were seen in the case law survey. The court in Sellers also wrote that some federal courts were using adjacent, but different, standards to determine whether sufficient notice was present, such as “conspicuousness.”²¹⁵ Conspicuousness was sometimes employed as an independent test, as one of many factors of the reasonable notice standard, and as a separate prong of the Berman test.²¹⁶ Overall, courts have been inconsistent in their application and analysis of conspicuousness. Additionally, some courts decided to forgo tests and standards in favor of making comparisons to websites and agreements that have been seen in courts already. Those decisions focused on the fact that the browsewrap or sign-in-wrap agreement in question resembled a similar agreement in a previous case. For example, the court in Peter v. Doordash compared the seller’s sign-up page to the website in Meyer, stating that “DoorDash’s sign-up page looks markedly similar to the page approved by Meyer. The screens are similarly uncluttered and wholly visible, and the notice text appears even closer to the sign-up button on DoorDash’s page than on Uber’s.”²¹⁷ Comparing agreements to others that have already been “approved” by courts may be temporarily efficient. Looking forward, however, this method may not be sustainable if online agreements continue to evolve at a fast pace. Some legal scholars, including Cheryl B. Preston, are not optimistic about the potential of evolving notice standards to sufficiently protect consumers, especially given the needs of the “Internet-instant-gratification generation.”²¹⁸ Perhaps Judge Easterbrook and the Sellers court were wise in declining to create bright-line rules; standards offer greater flexibility and adaptability to the online contracts of tomorrow.

This Note will not propose what alternative, more successful standards of notice might look like.²¹⁹ However, some other jurisdictions adopt combinations of these tests. Within the last few years, for example, Maine has embraced a “two-step inquiry” in which the first step focuses on a reasonably prudent user being put on reasonable notice of the contract terms, and the second step focuses on whether the user has manifested their assent.²²⁰ Perhaps California courts embrace the Berman standard and the context of the transaction test, which seek to combine many of the standards that have been employed within the past decade. A more uniform standard for notice would create consistency and reduce the current reliance on courts to define the scope of a notice inquiry.

This case law survey shows that a singular notice standard remains to be established in California. While reasonable notice was almost universally considered important, courts created their own interpretations of this standard and applied it in many different ways.

2. The Erosion of Distinct Wrap Categories

The results of this case law survey also show that courts did not always utilize California’s four wrap categories in evaluating the validity of an agreement. While the clickwrap and scrollwrap categories carried presumptions of validity,²²¹ the browsewrap and sign-in-wrap categories lacked definite boundaries and uniform standards of notice. A concurring opinion in Berman made a bold proposition: “browsewrap agreements are unenforceable per se; sign-in wrap agreements are in a gray zone; and clickwrap and scrollwrap agreements are presumptively enforceable.”²²² While this may be true for now, the Berman court’s declaration may lose relevance as soon as wrap contracts further evolve—or devolve.

One issue is that courts were not always consistent in their categorization of wrap agreements. In state and federal courts, there was a struggle to define agreements when they incorporated elements of more than one type of wrap. Some of the decisions labelled by the courts as browsewrap or hybridwrap involved website flows that also directed users to sign-in or create accounts.²²³ Thus, going forward, the wrap categories may only be useful insofar as the courts are consistent in their categorizations. Further, sellers are constantly adapting to standards set by new case law. For example, because Nguyen discouraged the use of a pure browsewrap agreement,²²⁴ sellers have expanded the world of browsewrap to include many hybrid variations. Courts often fail to characterize these agreements in specific or useful ways. For example, the state court case Kellman v. Honest Co. adopted the language used in Long v. Provide Commerce to describe the type of agreement in dispute: browsewrap with “something more.”²²⁵ Not only was this definition of an agreement vague, but it also relied on a clear definition of browsewrap, which may no longer exist.

The fact that courts have recognized new types of wrap in the past may suggest that there is room for further types of agreements in California contract law. However, even if courts were to acknowledge new categories, such a process would likely occur gradually, moving at a speed much slower than the speed at which sellers create new website flows. As mentioned before, courts still take a reactionary, ex ante approach when assessing the validity of an online contract.²²⁶

Looking forward, advances in technology may further blur the lines. Companies today are converting customers by monetizing places that are not traditionally used as marketplaces. “Social commerce,” for example, allows users of social media platforms like Instagram and Facebook to “purchase products without ever leaving the platform.”²²⁷ “Experience commerce” is another new example, promising to put the “customer first” and remove “the product from the center of the sales solution or offering” to create an “immersive . . . experience.”²²⁸ This Note does not speculate extensively about the future of ecommerce, but as Internet users find themselves becoming buyers in new contexts, they probably run a greater risk of assenting to terms unwittingly.

Overall, as sellers continue to adapt to current standards and hybridwrap becomes more pervasive, a fact-specific inquiry tailored to the agreement in question might always be necessary—even for cases involving clickwrap or scrollwrap. Thus, it is also worth considering whether these categorizations remain useful at all. First, there were the “two flavors” of contracts, clickwrap and browsewrap, and today, California courts recognize four. Moving forward, perhaps there will be many more—or none at all. This case law survey shows that the categories are already breaking down as sellers’ websites resist simple categorization. If courts continue to prefer reasonable notice or reasonably prudent user standards, then perhaps hard-and-fast contract categories will cease to be necessary because these standards apply regardless of the wrap type. Browsewrap and sign-in-wrap have arguably already lost their efficacy as distinct categories because there is so much variation among website flows. Indeed, courts sometimes declined to categorize agreements at all and instead prioritized a notice analysis.²²⁹

It is unclear whether the deterioration of wrap categories and emergence of fact-specific inquiries will create more protection for buyers. On the one hand, a fact-specific inquiry could benefit buyers because sellers exercise the most control over their websites. As masters of their own offers, they alone have the power to set the terms of the transaction. As Judge Wisdom suggested in Step-Saver, the fact that there is often no transaction history between parties to these contracts might cause buyers to assent to agreements that they do not anticipate or expect.²³⁰ On the other hand, and as emphasized by Judge Easterbrook in ProCD, the ubiquity of ecommerce and the natural competition of the market may create enough protection,²³¹ even as website flows evolve to become more complex. Although most consumers do not read sellers’ terms, reputation matters in a saturated market and might incentivize sellers to provide more favorable terms. Whether distinct wrap categories have longevity or not, courts likely need to define the appropriate notice standard that should be applied, which could eliminate some of the inconsistency highlighted by the Sellers court.

For now, this case law survey also shows that the four distinct contract categories still center in California courts’ preliminary analysis of the validity of an online contract, though hybridwrap is becoming more pervasive. Courts almost always begin their analysis of an agreement’s enforceability with an acknowledgement of the types of wrap, whether they use the categorization to presume validity or proceed to look for adequate notice by the seller. Because all wrap types can be potentially valid, courts are generally deferential to sellers and how they want to set the terms of their offers. There are still few bright-line requirements for sellers in this area of contract law, and parties are generally free to contract as they please.

3. The Relevance of Step-Saver and ProCD

The precedent set by Step-Saver and ProCD three decades ago is still applicable today. An important part of the ProCD decision was Judge Easterbrook’s adherence to the common law principle that any mode of acceptance set by an offeror—hence, any type of wrap—is valid as long as the buyer has notice. The offeror is the master of the offer and can propose specific modes of assent. The reasonable notice standard used widely in California is consistent with Judge Easterbrook’s determination that ProCD’s pop-up box gave the buyer enough notice of the seller’s agreement.²³² Many of the cases surveyed also prioritized the experience of buyers as part of an analysis of adequate notice. Relatedly, the reasonably prudent user standard can be traced to Step-Saver and Specht. It forces sellers to acknowledge the other party in designing an offer and work around the experience of the buyer or user. Perhaps this amounts to more protection for buyers. In some cases, the court went so far as to insinuate that sellers take advantage of buyers in formulating their modes of acceptance.²³³ Yet, this case law survey also shows that the ProCD and Step-Saver perspectives are not incompatible. Elements of both cases have made their way into California contract law, though Judge Easterbrook’s approach seems to be slightly more pervasive today.

Step-Saver and ProCD are often seen as cases that are pro-buyer or pro-seller. Step-Saver was largely concerned with holding businesses accountable and is an important check on sellers. In contrast, Eric Posner termed ProCD a “masterpiece of realist judging” in the “canon of contract law cases” because it encouraged sellers to continue conducting business as they had been.²³⁴ However, given the landscape of online contracting and the importance of notice, perhaps the cases should be recast as simply endorsing different standards of notice. Step-Saver is more aligned with the reasonably prudent user standard while ProCD is more aligned with reasonable notice. Online contract cases today implicitly recognize that form contracts enable the marketplace to function efficiently. Yet, because online sellers’ website flows vary to such a great degree, it is difficult to make blanket statements as to the validity of certain agreements. Thus, notice will almost certainly remain a point of discussion for courts, and these cases will remain relevant as the sources of two significant standards of notice.

The world of online contracting is quickly outpacing the factual relevance of the two cases because new means of manifesting assent are rapidly being invented. For example, the box-top licenses in Step-Saver and ProCD can be likened to browsewrap agreements today, but many sellers have already stopped creating pure browsewrap agreements after Nguyen. While form contracts will likely remain important and necessary for online contracting, current shrinkwrap-like modes of acceptance may not. Nevertheless, these cases connect the concept of notice in form contracts to essential contract common law principles. As long as online modes of contracting are held to the same requirements of offer and acceptance, the reasoning of Judge Wisdom and Judge Easterbrook should remain in contract casebooks. These two cases contributed to the development of major standards of notice.

CONCLUSION

As was true three decades ago when Step-Saver and ProCD created a circuit split, courts are still determining how to evaluate notice when considering the validity of form contracts. When courts evaluate the validity of a clickwrap or scrollwrap agreement, precedent alone may dictate a certain outcome. For cases involving browsewrap or sign-in-wrap, a fact-specific inquiry is almost always necessary. While it remains to be seen whether California’s four types of wrap will continue to be useful or important in evaluating sellers’ offers and agreements, it is likely that courts will continue to look for adequate notice. This case law survey demonstrates that there are two main standards of notice that can be traced back to ProCD and Step-Saver: a factor-based reasonable notice standard and a reasonably prudent user standard. There is presently no uniform method of applying these standards in California, but most courts nevertheless acknowledge that elements of both are important. Overall, case law is trending towards the ProCD view that contracting should not be impeded by burdensome standards for sellers. However, sellers should still be held to reasonable standards to keep consumers informed, which is consistent with Step-Saver. In conclusion, these two cases remain important as courts continue to evaluate whether buyers were sufficiently notified of sellers’ terms.

APPENDIX A. Surveyed Cases in California State Courts
	Case	Held For	Type of Contract	Disputed Terms	Summary
1	B.D. v. Blizzard Ent., Inc., 292 Cal. Rptr. 3d 47 (Ct. App. 2022)	Seller	Clickwrap	Arbitration Provision	Seller’s pop-up box gave sufficiently conspicuous notice that clicking a “Continue” button would manifest assent to the terms of a License Agreement.
2	Bowers v. Ritchie Bros., No. RG21095426., 2021 Cal. Super. LEXIS 33293 (Aug. 18, 2021)	Seller	Clickwrap	Forum-Selection Provision	Buyer assented to an agreement by clicking “I agree to the IronPlanet Buyer Terms and Conditions,” which was necessary to proceed with the transaction.
3	Doe v. Massage Envy Franchising, LLC, 303 Cal. Rptr. 3d 269 (Ct. App. 2022)	Buyer	Clickwrap	Arbitration Provision	Buyer brought an action for sexual assault, to which a seller moved to compel arbitration based on a clause in seller’s agreement. Buyer did not assent to a seller’s terms of service on an electronic tablet because the font color of the notice statement was not conspicuous, and terms were hyperlinked. Buyer was pressured to complete the forms quickly by seller’s staff.
4	Herzog v. Superior Ct., 321 Cal. Rptr. 3d 93 (Ct. App. 2024)	Buyer	Clickwrap	Arbitration Provision	Buyer assented to a healthcare company’s terms by clicking a box, but the agreement was deemed unenforceable because clicking the box also constituted authorization for the company to collect and store the personal health information; thus, there was no unambiguous assent to the terms.
5	Jackson v. Vines, No. CVRI2201731, 2023 Cal. Super. LEXIS 69073 (Jan 10, 2023)	Seller	Clickwrap	Arbitration Provision	Buyer assented to terms via a clickwrap agreement and could not use the fact that he did not recall doing so as a defense.
6	Njoku v. Airbnb, Inc., No. 21STCV34610, 2021 Cal. Super. LEXIS 84568 (Dec. 23, 2021)	Seller	Clickwrap	Arbitration Provision	Buyers were bound by an agreement because they clicked an electronic button that indicated their assent, even though the actual terms were hyperlinked and on another page.
7	Pierre v. Dexcom Inc., No. 37-2023-00014471, 2023 Cal. Super. LEXIS 56618 (July 28, 2023)	Seller	Clickwrap	Arbitration Provision	Buyer was bound by a clickwrap agreement that read “I agree” or “I accept” and was provided with a link to the readily available agreement.
8	Shaw v. U-Haul, No. 21STCV20248, 2022 Cal. Super. LEXIS 23561 (Mar. 16, 2022)	Seller	Clickwrap	Arbitration Provision	Buyer manifested assent by clicking “Accept” with respect to seller’s Arbitration Agreement.
9	Xiong v. Jeunesse Glob., LLC, No. 30-2019-01095448, 2020 Cal. Super. LEXIS 5220 (Oct. 6, 2020)	Seller	Clickwrap	Arbitration Provision	Buyer was bound by a clickwrap agreement that read “I agree,” and her inability to remember whether she clicked the box was an insufficient defense.
10	Blood v. L.T.D. Commodities LLC, No. 37-2020-00034050, 2021 Cal. Super. LEXIS 56220 (Sept. 24, 2021)	Buyer	Browsewrap	Arbitration Provision	A button on seller’s website that read “START SAVING” did not notify buyer that clicking the button would constitute assent to seller’s terms.
11	Collins v. Priceline.com, LLC, No. 20STCV10231, 2020 Cal. Super. LEXIS 5739 (Dec. 22, 2020)	Seller	Browsewrap	Arbitration Provision	Seller’s website contained an enforceable part-browsewrap, part-clickwrap agreement because buyer had to click to assent and complete a reservation.
12	Esparza v. 23andMe Inc., No. 37-2022-00051047, 2023 Cal. Super. LEXIS 54347 (July 21, 2023)	Buyer	Browsewrap	Arbitration Provision	A website’s terms of use were not binding because they were only available by clicking a hyperlink after scrolling to the bottom of the page or in the site’s chat feature.
13	Kellman v. Honest Co., No. RG16 813421, 2016 Cal. Super. LEXIS 20519 (Nov. 28, 2016)	Buyer	Browsewrap/ Hybridwrap	Arbitration Provision	Seller’s website design did not include design elements that would put a reasonably prudent buyer on notice of a browsewrap agreement.
14	Long v. Provide Com., Inc., 200 Cal. Rptr. 3d 117 (Ct. App. 2016)	Buyer	Browsewrap	Arbitration Provision	Seller’s checkout flow did not create adequate notice that placing an order indicated acceptance, nor did a link sent to buyer’s email create notice.
15	Pradmore v. J2 Glob., Inc., No. CGC-17-561916, 2018 Cal. Super. LEXIS 739 (Apr. 20, 2018)	Seller	Browsewrap/ Hybridwrap	Arbitration Provision	Seller’s agreement was enforceable because it contained elements of browsewrap but also required buyer to click a box to assent to complete a transaction.
16	Rabbani v. Tesla Motors Inc., No. 37-2021-00004478, 2021 Cal. Super. LEXIS 56460 (May 21, 2021)	Seller	Browsewrap	Arbitration Provision	Buyer was notified that placing an order would indicate assent to seller’s terms and did not click on hyperlinks that would have revealed said terms.
17	O’Connor v. Rd. Runner Sports, Inc., 299 Cal. Rptr. 3d 785 (Ct. App. 2022)	Buyer	Sign-In-Wrap	Arbitration Provision	In manifesting assent to cancel his membership to a seller’s loyalty program, buyer did not use seller’s preferred method to cancel the membership and seller’s arbitration agreement was found to be unenforceable.
18	Sellers v. JustAnswer LLC, 289 Cal. Rptr. 3d 1 (Ct. App. 2021)	Buyer	Sign-In-Wrap	Arbitration Provision	A sign-in-wrap agreement was not binding when buyer signed up for a free trial of a service because notice was not clear and conspicuous, and this was not the type of transaction that would entail an ongoing contractual relationship.
19	Skurskiy v. Neutron Holdings, Inc., No. 19STCV36846,Cal. Super. LEXIS 104325 (Cal. Super. Ct. Apr. 15, 2021)	Seller	Sign-In-Wrap	Arbitration Provision	In signing up for a seller’s service, buyer clicked an “I Agree” button where language on the page was apparent that clicking would indicate assent to seller’s user agreement.
20	Thompson v. Live Nation Ent., No. 30-2018-00976153, 2018 Cal. Super. LEXIS 42847 (May 4, 2018)	Seller	Sign-In-Wrap/Browsewrap	Arbitration Provision	Buyer was required to acknowledge seller’s terms twice in the process of creating an account and therefore assented. Key terms were set apart in a different color from other words.

APPENDIX B. Surveyed Cases in U.S. District Courts in California
	Case	Held For	Type of Contract	Disputed Terms	Summary
1	Brown v. Madison Reed, Inc., No. 21-cv-01233, 2021 U.S. Dist. LEXIS 164002 (N.D. Cal. Aug. 30, 2021)	Seller	Clickwrap	Arbitration Provision	Buyer was bound by seller’s agreement because notice of the terms was set apart in bold and in a different color. Clicking to manifest assent was required to place an order.
2	Tingyu Cheng v. Paypal, Inc., No. 21-cv-03608, 2022 U.S. Dist. LEXIS 7245 (N.D. Cal. Jan 13, 2022)	Seller	Clickwrap	Arbitration Provision	Seller’s agreement was binding on buyer because he had to check a box indicating that he had read and agreed to a User Agreement and clicked a large blue button to indicate assent to creating an account.
3	Vanden Berge v. Masanto, No. 20-cv-00509, 2020 U.S. Dist. LEXIS 261762 (S.D. Cal. Sept. 22, 2020)	Seller	Clickwrap	Arbitration Provision	Buyer was bound by seller’s terms because she affirmatively agreed to a clickwrap agreement while making a purchase.
4	Flores v. Coinbase, Inc., No. CV 22-8274, 2023 U.S. Dist. LEXIS 90926 (C.D. Cal. Apr. 6, 2023)	Seller	Scrollwrap	Arbitration Provision	Seller’s scrollwrap agreement was valid because the full text of the User Agreement was placed before buyer.
5	Perez v. Bath & Body Works, LLC, No. 21-cv-05606, 2022 U.S. Dist. LEXIS 116039 (N.D. Cal. June 30, 2022)	Seller	Scrollwrap	Arbitration Provision	Seller’s agreement was valid because buyer was physically required to scroll through the terms in order to assent.
6	Stewart v. Acer Inc., No. 22-cv-04684, 2023 U.S. Dist. LEXIS 10241 (N.D. Cal. Jan. 20, 2023)	Seller	Scrollwrap	Arbitration Provision	Seller’s agreement was enforced because the terms appeared after turning on the product (a computer) and constituted adequate notice.
7	Allen v. Shutterfly, Inc., No. 20-cv-02448, 2020 U.S. Dist. LEXIS 167910 (N.D. Cal. Sept. 14, 2020)	Seller	Browsewrap/ Hybridwrap	Arbitration Provision	Buyer was bound by a browsewrap agreement where constructive notice was present due to the conspicuousness of the terms, although they were hyperlinked.
8	Brooks v. IT Works Mktg., No. 21-cv-01341, 2022 U.S. Dist. LEXIS 103732 (E.D. Cal. June 9, 2022)	Buyer	Browsewrap	Arbitration Provision	Buyer was not bound by seller’s terms because she never saw the link to the Terms of Use as they were in a small font and an inconspicuous color.
9	Chien v. Bumble Inc., 641 F. Supp. 3d 913 (S.D. Cal. 2022)	Seller	Browsewrap/ Hybridwrap	Arbitration Provision	Buyer was bound by seller’s agreement because a pop-up blocker card containing the Terms and Conditions and a button stating “I accept” was reasonable notice.
10	Crawford v. Beachbody, LLC, No. 14cv1583, 2014 U.S. Dist. LEXIS 156658 (S.D. Cal. Nov. 5, 2014)	Seller	Browsewrap/ Hybridwrap	Forum-Selection Provision	An enforceable agreement was made because seller’s Terms and Conditions were in a conspicuous font directly below the “PLACE ORDER” button to complete the transaction.
11	DeVries v. Experian Info. Sols., Inc., No. 16-cv-02953, 2017 U.S. Dist. LEXIS 26471 (N.D. Cal. Feb. 24, 2017)	Seller	Browsewrap/ Hybridwrap	Arbitration Provision	Seller’s browsewrap agreement was valid because there was adequate notice when the phrase “Terms and Conditions” was in a different color and in close proximity to a clickable button.
12	Friedman v. Guthy-Renker LLC, No. 14-cv-06009-, 2015 U.S. Dist. LEXIS 24307 (C.D. Cal. Feb. 27, 2015)	Buyer	Browsewrap/ Hybridwrap	Arbitration Provision	Buyer was not bound by seller’s terms and conditions because the hyperlink to the terms was “buried” at the bottom of the screen and not enough notice was provided of their existence.
13	Hansen v. Ticketmaster Ent., Inc., No. 20-cv-02685, 2020 U.S. Dist. LEXIS 233538 (N.D. Cal. Dec. 11, 2020)	Seller	Browsewrap/ Sign-In-Wrap	Arbitration Provision	Seller’s browsewrap agreement was valid because assenting to terms was required before buyer had the option to purchase tickets from seller.
14	Moyer v. Chegg, Inc., No. 22-cv-09123, 2023 U.S. Dist. LEXIS 128352 (N.D. Cal. July 25, 2023)	Seller	Browsewrap/ Sign-In-Wrap	Arbitration Provision	Buyer was bound because she received conspicuous notice of the terms, which were hyperlinked right below a button that buyer needed to click to create an account.
15	Shultz v. TTAC Publ’g, LLC, No. 20-cv-04375, 2020 U.S. Dist. LEXIS 198834 (N.D. Cal. Oct. 26, 2020)	Buyer	Browsewrap/ Hybridwrap	Arbitration Provision	Buyer was not bound by seller’s browsewrap/clickwrap agreement because the checkbox next to the statement “I agree to the terms and conditions” was checked by default, requiring no act of assent by the user.
16	Colgate v. Juul Labs, Inc., 402 F. Supp. 3d 728 (N.D. Cal. 2019)	Buyer	Sign-In-Wrap	Arbitration Provision	Seller’s notice was not conspicuous enough to notify buyer because the hyperlink to the Terms and Conditions was not underlined, italicized, or visually distinct from the surrounding text.
17	Seneca v. Homeaglow, Inc., No. 23-cv-02308, 2024 U.S. Dist. LEXIS 33698 (C.D. Cal. Feb. 7, 2024)	Buyer	Sign-In-Wrap	Arbitration Provision	Seller’s sign-in-wrap agreement was not binding on buyer because buyer had already purchased services from seller when the agreement was presented, and the notice was not conspicuous.
18	Peter v. Doordash, Inc., 445 F. Supp. 3d 580 (N.D. Cal. 2020)	Seller	Sign-In-Wrap	Arbitration Provision	Seller’s agreement was notably similar to the agreement in Meyer and the notice text was conspicuous. Thus, the agreement was binding on buyer.
19	Regan v. Pinger, Inc., No. 20-CV-02221, 2021 U.S. Dist. LEXIS 33839 (N.D. Cal. Feb. 23, 2021)	Seller	Sign-In-Wrap	Arbitration Provision	Seller’s repeated notice that the creation of an account would constitute assent to the Terms of Service was enough to bind a user.
20	Serrano v. Open Rd. Delivery Holdings, Inc., 666 F. Supp. 3d 1089 (C.D. Cal. 2023)	Buyer	Sign-In-Wrap	Arbitration Provision	Seller’s webpage did not provide reasonably conspicuous notice of the terms and conditions because the notice text was small and in a light-colored font.

98 S. Cal. L. Rev. 419

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Sophie Lee*

* Executive Membership Editor, Southern California Law Review, Volume 98; J.D. Candidate 2025, University of Southern California Gould School of Law; B.A. History, Creative Writing 2022, Columbia University. Thank you to Professor Jonathan Barnett and Professor Jordan Barry for the thoughtful feedback and to my friends and family for their consideration and acceptance.

California Code of Civil Procedure Section 998: An Offer to Compromise Between the American and English Rules for Fee-Shifting?

September 2024April 2025Jaime Fong

Imagine you bring a personal injury claim seeking damages of $950,000. At the end of trial, the jury finds the defendant negligent and awards you $375,000. Although you prevailed at trial, the court orders you to pay a portion of the defendant’s litigation costs. Accordingly, you lose your entire award and are required to provide an additional payment of $18,000 to the defendant. If you are confused by this hypothetical situation, you are not alone. This seemingly backwards scenario is made possible by California Code of Civil Procedure section 998 (“section 998”),¹ a cost-shifting statute that has perplexed California litigators for decades.

When it comes to the determination of which party is responsible for paying legal fees in a litigation, there are two prominent models: the “English rule” and the “American rule.”² The majority of the Western world implements the English rule,³ which embodies a loser-pays system in which litigation costs, including attorney’s fees, are shifted to the losing party.⁴ Conversely, in America, absent bad faith or a statutory or contractual provision to the contrary, the general rule is no fee-shifting.⁵ In other words, unless a lawsuit involves bad faith, a contractual dispute and the contract at issue contains a fee-shifting provision, or a statute that provides for recovery of costs, each party bears their own litigation costs, irrespective of the outcome.⁶

Each model has its pros and cons. On the one hand, a loser-pays system—the English rule—discourages nuisance litigation and promotes settlement, but may subsequently reduce access to litigation,⁷ even for those with meritorious claims.⁸ Conversely, a system that does not generally allow for fee-shifting—the American rule—enables individuals to have their fair day in court, avoiding the English rule’s “potential chilling effect on meritorious litigation.”⁹ The American rule, however, may subsequently decrease the likelihood of settlement and open the door for increased nuisance litigation, which may overwhelm court systems.¹⁰

Because the American rule may lack distinct incentives for parties to settle or to refrain from bringing frivolous claims that create a backlog in courts, the American justice system has devices to encourage parties to settle their claims and resolve disputes as quickly and efficiently as possible. One such device includes offer-of-judgment rules: a type of fee-shifting statute that provides an exception to the general rule against fee-shifting. Offer-of-judgment rules are offer-based fee-shifting rules that allocate costs according to pretrial settlement offers.¹¹ Thus, under an offer-of-judgment rule, if a litigant rejects a pretrial settlement offer and subsequently receives a less favorable judgement at trial, they must compensate the offeror for certain post-offer costs.

Section 998 is California’s offer-of-judgment rule. Section 998 is a cost-shifting statute designed to encourage settlement of litigation, without the need for a trial, by shifting certain costs to a party that rejected a 998 “offer to compromise” from their opponent and subsequently failed to obtain a better result at trial.¹² The California legislature and courts have made clear that the fundamental policy behind section 998 is to encourage the settlement of lawsuits prior to trial. However, statutory and case law analyses may indicate that 998’s policy also encompasses promoting settlement without unduly limiting access to courts.

The effectiveness of section 998 remains an ongoing debate among civil litigators. Application of section 998 is exceedingly difficult to understand and there is concern that it may not offer a high enough incentive to settle since the statute allows only a limited amount of recoverable costs. On the other hand, even if section 998 does not result in settlement as frequently as anticipated, it is a beneficial tool that provides a financial incentive for parties to settle that might not otherwise exist. As the debate over section 998’s efficacy continues, the California legislature and courts will likely be increasingly confronted with proposed amendments and judicial disputes over its applicability. Accordingly, in the future, these state actors may wish to consider how section 998 may be a powerful vehicle to relieve overburdened courts without overly deterring claimants from protecting their rights or interests.

This Note considers the extent to which section 998 can genuinely be considered a compromise between the English and American rules for fee-shifting, rather than just a tool to promote settlement. In particular, this Note asks whether section 998 seeks to promote settlement without unduly limiting access to courts, and if so, to what extent.. Although section 998 may be used in trial and arbitration,¹³ this Note focuses on section 998 in the context of litigation and trial. To help inform this Note’s discussion of the underlying policy tradeoffs behind different fee-shifting rules and the significance of promoting settlement prior to trial, Part I provides an overview of the mechanics, principal stages, and costs of civil litigation. Part II discusses section 998 relative to the competing models of the English rule and the American rule, including general policy tradeoffs and impact on litigation strategy. Part III provides an overview of the statutory framework of section 998 and its underlying policy considerations. Part IV examines section 998 legal developments and whether if, and to what extent, judicial determinations are not only promoting section 998’s purpose of encouraging settlements but also doing so without unduly limiting access to courts. A conclusion with final considerations follows.

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Defining the Relationship: California’s Noncompete Laws and Exclusivity in the Acting Industry Leading Up to the 2023 SAG-AFTRA Strike

August 2024August 2024Katarina Ulich*

California is firm in its stance against post-term noncompete clauses. This Note examines early Hollywood and the historical and economic context in which talent contracts arose. It analyzes the shift in talent contracts from the harsher terms of the 1930s studio system to the modern terms which give more control to actors.

Exclusivity exists in both the film and television industry. However, the in-term and post-term treatment of exclusivity provisions and noncompetes has received conflicting treatment by California and Ninth Circuit Courts, suggesting that perhaps the California Supreme Court should weigh in on the matter as they did in 2008 with Edwards v. Arthur Andersen and articulate whether Section 16600 can apply to in-term noncompete and exclusivity provisions. While it is widely held that Section 16600 does not apply to in-term noncompetes, the holding in ITN Flix, LLC v. Hinojosa suggests that certain situations in the acting industry may trigger its application and deem an in-term noncompete invalid if unduly harsh.

Regardless, the ability of actors and unions to negotiate with studios for mutually beneficial terms has allowed common practices in entertainment contracts to shift over time without much recent legislation. This suggests that, while the applicable law will provide one side with bargaining power, negotiations and collective-bargaining agreements will largely continue to set the standards for common entertainment contract practices.

INTRODUCTION

From 2005 to 2010, American actress Katherine Heigl appeared in the hit ABC television medical drama, Grey’s Anatomy, as the supporting role of Dr. Izzie Stevens.¹ Simultaneous to her work on the television series, Heigl starred in films that would soon become classics of the 2000s, such as Knocked Up (2007), 27 Dresses (2008), and The Ugly Truth (2009).² By 2008, Heigl had been deemed the new “It Girl” of Hollywood by Vanity Fair as a result of her acting endeavors.³ Knocked Up had been a box office hit, and Heigl had taken home the 2007 Primetime Emmy Award for Outstanding Supporting Actress in a Drama Series for her television work on Grey’s Anatomy.⁴ Heigl had pursued a career in film while still appearing as a series regular on Grey’s Anatomy, rendering her a household name across the United States. Meanwhile, the lead of Grey’s Anatomy—Ellen Pompeo—had not appeared in a role outside of Dr. Meredith Grey since the series inception in 2005.⁵ While this could be attributed to personal choices, it may instead be the result of contractual differences between a series’s lead actress and a supporting actress, stemming from varying exclusivity terms. It is possible that Ellen Pompeo, as the lead role of Meredith Grey, was “contractually forbidden from acting elsewhere.”⁶ In 2018, Pompeo told The Hollywood Reporter, “I don’t get to do anything else, and that’s frustrating for me creatively. I make 24 episodes of TV a year, and as part of this deal, I cannot appear anywhere else.”⁷ While exclusivity terms can be frustrating to an actor,⁸ as demonstrated by Pompeo’s statement to The Hollywood Reporter, many studios view exclusivity as vital to production. Studios use exclusivity to coordinate production schedules and ensure talent’s availability as they invest time and money in the creation of a particular character.

In 2022, exclusivity terms could be freely negotiated in the entertainment industry when union actors were paid above an “exclusivity money break.”⁹ The exclusivity money break is a minimum salary bargained for by SAG-AFTRA,¹⁰ above which producers and talent can negotiate exclusivity freely. This would often result in producers paying substantial salaries for the exclusivity of top talent.¹¹ Meanwhile, union actors paid below the exclusivity money break (non-star talent) were restricted in their ability to grant exclusivity.¹² While these restrictions are discussed later in detail, actors in this latter non-star category who worked on a streaming show were often able to appear in feature films, as guests on other shows, and in commercials, yet they sometimes had to receive permission from studios in order to do so.¹³ Practical difficulties sometimes arose in the process of coordinating outside roles, as the actor’s main show would take scheduling precedence and restrict the actor’s ability to alter their appearance.¹⁴ This tension between actors, who often want the freedom to appear in additional roles, and studios, who face the challenges of coordinating production schedules and may have invested in an actor’s image, has led to debate in Hollywood surrounding the use of exclusivity provisions in talent contracts. Exclusivity, along with other issues concerning residuals and the use of Artificial Intelligence, contributed to SAG-AFTRA’s 2023 strike against Hollywood’s major studios, lasting 118 days from July to November of 2024 while new contract boundaries were negotiated.¹⁵ This Note will examine the contractual exclusivity terms leading up to the 2023 strike. The rise of online streaming has increased the demands placed on actors, as shorter series seasons contribute to more idle time for actors. The landscape is changing rapidly, resulting in the frequent renegotiation of terms and resulting standstills, exemplified by the 2023 SAG-AFTRA strike.

Exclusivity provisions are contractual terms that prevent an employee from working elsewhere during the term of their employment, resulting in the employee giving their undivided effort to the employer. Noncompete clauses are another set of contractual terms that also appear in talent contracts and typically restrict an employee from working for certain third-parties. Noncompetes may last for only the term of the employment, and thus be in-term restrictions, or they may last after the employee no longer works for the current employer, which is a post-term restriction.¹⁶

Arguments exist on both sides of the general debate around exclusivity provisions and noncompetes in the talent industry. Opponents argue that they hinder competition by restricting the free movement of talent and ideas.¹⁷ In the talent industry specifically, SAG-AFTRA has argued that exclusivity terms in actors’ personal service agreements are often used to “hold series regulars off the market and unable to work for unreasonably long periods of time”¹⁸ while a show is in an off period.¹⁹ SAG-AFTRA has noted that these exclusivity provisions were less burdensome when talent worked three quarters of the year on twenty episode seasons, but that the rise of online streaming platforms, year-round production cycles, and short seasons of thirteen episodes (or sometimes fewer) have left lower and mid-level actors short of work.²⁰ Some actors are “not being paid while on hold between seasons, but they’re also not allowed to accept other paying jobs. These contracts mean that actors often find themselves collecting unemployment, struggling to pay their bills and unable to build a career.”²¹ The arguments against exclusivity and noncompetes have received national attention.²² In 2021, President Biden issued an executive order attempting to limit the effect of noncompetes, authorizing the Federal Trade Commission (“FTC”) to “interpret noncompetition agreements as an unfair method of competition, and thereby declare them unlawful.”²³ SAG-AFTRA was “ ‘thrilled to see President Biden take steps to curtail the use of unfair non-compete clauses, which are a major problem for . . . actors . . . .’ ”²⁴

Conversely, proponents of exclusivity provisions and noncompetes argue that without them, employers have little incentive to invest in the development of their employees.²⁵ In the acting industry specifically, production studios have concerns regarding the coordination of “complex production schedules involving hundreds—or at times even thousands—of people [with the] talent’s availability.”²⁶ The California Chamber of Commerce argues that without exclusivity, talent contracts are far “less valuable, which will lead to a reduction in wages paid to actors.”²⁷ Charles Rivkin, Chairman and CEO of the Motion Picture Association, views exclusive employment agreements as the backbone of scheduling for film, television, and streaming productions: they “provide the certainty necessary for producers to finance, insure, plan for and complete major feature film, television and streaming projects, particularly those involving long-term story arcs. They assure writers and showrunners that characters developed in one season can be brought back for subsequent storylines.”²⁸ Further, studios note an interest in preserving the investment of “millions [of dollars] in developing and promoting a show [and its actors, and] don’t want to see the lead actor show up in another series on a rival network.”²⁹ A studio may seek to control the image of a particular actor to protect its franchise from actions which could negatively impact the performance of the franchise, and thus, the studio itself.

Section 16600 of the California Business & Professions Code (“Code”) acts as a per se ban on noncompete agreements in California, as it “does not permit non-compete clauses, even if they are reasonable in scope and purpose.”³⁰ While many states operate under reasonableness standards, enforcing noncompetes when they are reasonable in scope and duration,³¹ the California Supreme Court case Edwards v. Arthur Andersen is strong in both its language and policy rationale against the enforcement of post-term employment restrictions. Following the 2008 decision in Edwards, discussed later in this Note, any post-term employment restriction is likely to fail. Discussion around the Code has focused on Silicon Valley, where the ban on noncompetes has often allowed technology companies and start-ups to innovate rapidly as employees move from company to company. However, little attention has been paid to the application of Section 16600 in Hollywood, particularly to its recent extension by the Ninth Circuit to reach in-term agreements in the acting industry in ITN Flix, LLC v. Hinojosa.³²

This Note investigates noncompete agreements and exclusivity in the entertainment industry through the lens of Section 16600 and critically analyzes recent decisions involving the extension of Edwards to in-term noncompetes and exclusivity agreements in talent contracts. Historically, case law involving Section 16600’s ban on noncompetes has been limited to post-term employment restrictions. In the acting context, post-term noncompetes are those which restrict an actor’s employment options after they no longer work with a particular studio. However, a recent Ninth Circuit case (ITN) broadens the scope of Section 16600 to potentially invalidate in-term noncompete contracts that restrict an actor’s work, even if only for the duration of the employment contract. This Note discusses the Ninth Circuit’s decision, weighing the tension between exclusivity proponents and opponents to explore the extension of Section 16600 to in-term noncompetes and exclusivity clauses in the talent context.

Part I examines early Hollywood and the historical and economic context in which talent contracts arose. It analyzes the shift in talent contracts from the harsher terms of the 1930s studio system to the modern terms which give more control to actors. It provides a summary of common industry practices prior to the 2023 SAG-AFTRA strike. The agreements between SAG-AFTRA and major studios that led up to the strike are also explored, highlighting the prevalence of exclusivity while weighing the tension between its proponents and opponents.

Part II discusses Section 16600 and the significant 2008 California Supreme Court decision, Edwards v. Arthur Andersen, after which any post-term restriction on employment in California will likely fail.

Part III analyzes the possible extension of Edwards to in-term noncompete agreements and the changes that this extension may bring to exclusivity in the acting industry. To do so, it touches again on common exclusivity practices as well as in-term and post-term noncompete practices in the acting industry, while critically analyzing case law to explore how Section 16600’s extension to in-term noncompete and exclusivity provisions may bring unintended results. It concludes with a suggested theoretical legal standard that would consider an actor’s fame when analyzing exclusivity and noncompetes.

Part IV summarizes the case law findings and asks the California Supreme Court to weigh in on the conflicting lower court precedent, and the conclusion summarizes the findings from this Note.

I. HISTORY OF THE ENTERTAINMENT INDUSTRY

[T]he legal framework . . . in which all entertainment and media businesses operate is constantly challenged and in need of regular review and adjustment.

—Harold L. Vogel³³

A. The Economics of the 1930s Studio System

Shortly after film was introduced to the United States in the early 1900s, the major film studios realized there was immense potential for vertical integration and cost minimization in the film industry.³⁴ They quickly began to operate almost every stage of film production, from “production [and] distribution [to] exhibition.”³⁵ The West Coast (and Southern California in particular) emerged as the heart of this new and emerging studio system, as Hollywood was “far for the Trust enforcers to reach [and] . . . provide[d] low-cost nonunion labor and an advantageous climate and geography for filming.”³⁶ After the Great Depression, it was only “the companies with the most vertical integration . . . that survived,” further concentrating the control over the movie industry.³⁷ An incredibly “productive [and] efficient” synergy emerged as the major companies cooperated in “a ‘mature oligopoly’ ” with a significant share of the Hollywood market.³⁸

Vertical integration characterized this era of film production, with the major companies exerting control over large parts of the industry.³⁹ By the 1930s, this studio system led to stars signing “long-term contracts.”⁴⁰ While accompanied by cost minimization and efficiency, these contracts were often harsh and demanding, leaving little autonomy to actors.⁴¹ This early coordination of “studio operations [with] marketing strategies” brought “substantial [cost] savings [to] the studio [system.]”⁴² Exclusive contracts between stars and studios could last up to seven years, and in practice, even longer. ⁴³ Actors such as “Bette Davis and James Cagney were constantly suspended without pay by Warner Bros. for refusing roles.”⁴⁴ Actors who were suspended, such as Davis and Cagney, due to their “refus[al] to be loaned out to another studio or declin[ing of] a role . . . could be suspended without pay[, with the] length of the suspension . . . added to that of the contract,” extending contracts beyond seven years.⁴⁵

Early challenges to these contractual practices were unsuccessful, as demonstrated by Bette Davis’s 1937 lawsuit against Warner Brothers.⁴⁶ The same year as Davis’s unsuccessful lawsuit, California (home of Hollywood and longtime proponent of employee rights) enacted Section 2855 of the Code to limit the indefinite employment contracts often abused by studios.⁴⁷ Commonly referred to as the “Seven Year Rule,” Section 2855 “limits the term of personal service employment to seven years,” rendering any personal-service contract unenforceable past the seven-year mark.⁴⁸ This Section was tested in 1943, when Olivia de Havilland sued Warner Brothers.⁴⁹ The studio had refused to release De Havilland from her seven-year contract (despite the seven years lapsing) and claimed that her refusal to accept certain roles over the years had resulted in the addition of six months to her contract.⁵⁰ This practice of adding time to contracts was common in Hollywood, and these “suspension/extension” provisions (previously upheld in Bette Davis’s case) “could double the term of an actor’s contract.”⁵¹ De Havilland successfully argued that Warner Brothers was breaching its contract—as the contract was for seven years regardless of her refusal of certain roles—and violating labor law in doing so, as California had a statutory limit of seven calendar years on the enforcement of employment contracts.⁵² This marked the beginning of a new era of bargaining power for employees. This monumental decision applied “to more than just Hollywood[, as it] applied to every employee in California.”⁵³ While the extension provisions of De Havilland’s contract were deemed illegal in 1943, her concern around being held off the market is still shared by many series regulars today in the debate around exclusivity. An actor’s desire to pursue additional roles may conflict with a studio’s desire to coordinate production schedules.

Until the late 1940s, the major studios had maintained almost complete vertical integration of the film production process, evading various antitrust charges through government deals.⁵⁴ But in 1948, Paramount was found guilty of price-fixing by the Supreme Court in an antitrust lawsuit.⁵⁵ This case, widely known as the beginning of the end of Hollywood’s Golden Age, forced film studios to break up their vertically integrated practices.⁵⁶ A decree was signed by the major studios which “separated production and distribution from exhibition.”⁵⁷

This separation of exhibition from other links in the production chain played a transformative role in fundamentally shifting entertainment industry practices, replacing the long-term contracts of the 1930s with the disintegrated model of the 1950s.⁵⁸ With the collapse of the vertically integrated studio system, long-term contracts and standard seven-year exclusivity provisions were phased out and replaced by the freelance model that is still in place today.⁵⁹

Later, the emergence of television caused movie theater attendance to decline, leading studios to limit film production.⁶⁰ “[C]ontracted stars . . . became a hugely expensive overhead,” moving the industry into a freelance model as studios looked to cut costs.⁶¹ The relationship between studios and talent shifted as stars were given more freedom to choose their roles. Still, studios often incorporated exclusivity terms into deals as “series regular actors were busy working almost the entire year, with long production periods and short hiatuses that made their employment similar to other full-time jobs.”⁶² As film and series productions have grown in size and scale, studios argue that the exclusivity of actors involved in a production is essential to the coordination of various schedules and logistics. The ability to contract for the exclusivity of certain well-known actors may offer large incentives for a studio to invest in a production.⁶³

B. Modern Talent Contracts

Currently, Hollywood does not operate by the onerous long-term contracts that once existed, as modern talent contracts are no longer set at seven-year terms of exclusive work as they were in the 1930s. Instead, talent is cast specifically from project to project, often incorporating exclusivity clauses in both the film and television industry. Special contract terms, such as option contracts and pay or play contracts, raise similar issues to in-term exclusivity surrounding an actor’s ability to pursue other roles. The following paragraphs state the entertainment industry terms as they existed prior to the 2023 SAG-AFTRA strike.

1. Film

Film production begins and ends on (more or less) defined dates.⁶⁴ As a result, exclusivity terms in movie deals are common and are rarely a source of extreme debate. An actor’s film contract will often explicitly include the dates for “consecutive exclusive preproduction services, a specified number of weeks for shooting, and a maximum number of days for postproduction services.”⁶⁵ In-term exclusivity provisions tend to accompany the preproduction and production period,⁶⁶ as exclusivity is often used to coordinate scheduling among large casts and crews, and actors are left with little idle time during film rehearsals and shooting. Conversely, postproduction requests⁶⁷ are generally subject to an actor’s availability, as an actor’s work will typically be completed and any post-term restriction preventing the actor from accepting other jobs would likely be invalidated by Section 16600.⁶⁸

It may be possible, however, for talent contracts to include postproduction restrictions preventing actors from working on certain projects for a certain amount of time even after a movie has completed filming. One can imagine this being the case for actors in the Marvel Universe.⁶⁹ For example, Chris Hemsworth—popular for his role as superhero Thor in the Marvel Comics (“Marvel”) film Thor as well as The Avengers—could theoretically be unable to appear in films by Marvel’s direct competitor, DC Comics (“DC”).⁷⁰ Marvel and DC are both immensely popular comic-book publishers that have transformed their comic-book characters into big-screen franchises. If these contractual provisions exist, they may be legally vulnerable, as Section 16600 invalidates post-term restrictions on an employee’s work.

It is also possible that these terms, which (on face value) appear to be post-term, are actually in-term restrictions, and thus valid under Section 16600. The acting industry has a unique gray area between in-term and post-term restrictions when an actor is no longer actively filming but may be called back for a reshoot, or–for example–when an actor is no longer filming the first Thor movie but is still under an exclusive contract for the second movie. While this may be in-term contractually, it has post-term implications as an actor’s work is restricted while they wait for the next production cycle to begin. This area of talent contracts seems to be the most legally vulnerable, especially under the Ninth Circuit’s extension of Section 16600 in ITN to invalidate in-term noncompete provisions.

2. Series and Short Form (Television)

While not heavily debated in film contracts, exclusivity terms are a highly contentious subject of debate in television and series contracts. Television seasons may be short, and actors may find themselves wanting to solicit intermittent work, leading them to seek additional roles while still under contract with another show. Unlike films, there is not a set beginning and end date in television series production, as shows are in “a relatively constant state of production and postproduction during which there will be stretches of time when an actor’s services are not needed.”⁷¹ Exclusivity terms can vary greatly depending on the contractual terms negotiated: a series actor who wants to render outside services may either be free to do so, may need special permission from the studio, or may be prohibited from doing so.⁷²

When a television talent contract does allow an actor to pursue additional roles, there are practical limits to an actor’s ability to do so, as studios prefer their talent to be somewhat exclusive to their shows.⁷³ For example, scheduling work on a feature film is difficult, as television series production is demanding and leaves only a few days off at a time (apart from true offseasons).⁷⁴ Further, many deals preclude an actor from appearing on another television series, apart from “a limited number of guest spots, appearance in foreign commercials and services in nonidentified voice-over commercials.”⁷⁵ Standard series agreement deals (as of December 2021) allowed networks and streaming services to enter into exclusivity deals with talent for “anywhere from nine months to more than a year in some cases,” making the process of rendering outside services difficult during this period.⁷⁶

Noncompete and exclusivity terms for a series contract generally fall in the category of in-term restrictions, as they apply to the actor while they are still in a contract for their current series. They are therefore not legally vulnerable under the historical interpretation of Section 16600, which has traditionally applied only to post-term restrictions. If, however, the Ninth Circuit’s extension of Section 16600 in ITN to invalidate in-term employment restrictions is valid, then these common industry practices may be legally vulnerable.⁷⁷

3. Option Contracts

When a film or television series is part of a larger, ongoing story and multiple production periods are likely (such as classic blockbuster films like Wonder Woman and Spider-Man for which sequels can be anticipated), option contracts are often used. An option clause in a talent contract “gives the producer or studio the sole right, or ‘option,’ to extend a contract for an additional period of time [and] commits the actor to working on the subsequent television or new media season.”⁷⁸ The option period can last anywhere from months to years.⁷⁹ While option clauses ensure that characters an audience has come to know and love will be returning in the same role, they have the potential to prevent an actor from accepting additional work when paired with exclusivity terms, as options can be exercised even if no start date has been set for the next project.⁸⁰ This raises similar issues to exclusivity and noncompetes, as actors may be kept off the market for unreasonably long periods of time, yet studios have an interest in ensuring well-known characters such as Wonder Woman and Spider-Man are able to return for a sequel.

4. Pay or Play

A pay or play term in a contract guarantees that an actor will be paid for their role in a production, regardless of whether they are used or whether the production gets made.⁸¹ These terms can typically only be negotiated by top talent, as they require the studio to pay the actors their full salaries “even if they are terminated before rendering all of their services.”⁸² This compensates the talent for rejecting other “lucrative” roles with similar time lines due to the expectation of exclusivity surrounding their involvement in the pay or play production.⁸³ Pay or play terms therefore symbolize the acknowledgement by studios that exclusivity is highly valuable, and as such, studios are willing to compensate top talent highly for the opportunity cost of rejecting other roles. Since these terms are often accompanied by exclusivity terms, they may be subject to challenges if Section 16600 is extended to invalidate in-term exclusivity.

C. Industry Practices

The Screen Actors Guild (“SAG”) was founded in 1933 as a union representing actors in “film, television, and digital media.”⁸⁴ In 2012, the Screen Actors Guild merged with the American Federation of Television and Radio Artists (“AFTRA”) to form SAG-AFTRA, a powerful union representing “approximately 160,000 actors, announcers, broadcast journalists, dancers, DJs, news writers, news editors, program hosts, puppeteers, recording artists, singers, stunt performers, voiceover artists and other media professionals.”⁸⁵ The union is frequently in talks with major production studios to exercise its collective-bargaining power and achieve favorable deals for its members, going on strike in 2023 to do so.

In-term exclusivity is highly contested in the acting industry as a constant battle between studios, who view the terms as essential to production, and actors and unions, who generally oppose them. In August of 2022, SAG-AFTRA⁸⁶ reached an agreement with Netflix (“Agreement”) limiting the use of exclusivity provisions for series regulars.⁸⁷ A similar agreement was reached between SAG-AFTRA and the Alliance of Motion Picture and Television Producers (“AMPTP”)⁸⁸ limiting exclusivity in series actors’ employment agreements.⁸⁹ SAG-AFTRA’s 2023 strike ended in November of 2023 (the Writers Guild of America also went on strike on May 2, 2023 and ultimately reached a deal with AMPTP on September 27, 2023).⁹⁰ This Note will focus on the terms impacting SAG-AFTRA as they existed prior to the 2023 strike.

An important distinction exists between stars and other talent in the entertainment industry when considering the practical relevance of the prior Agreement’s minimum terms. For those paid above a minimum salary, known as the “exclusivity money break,” the minimum terms of the collective-bargaining agreement do not apply.⁹¹ This means that stars and top-tier talent paid above this amount are not bound by the terms, limiting the effect of the Agreement to non-star talent. The 2022 SAG-AFTRA and Netflix Agreement increased this exclusivity money break (above which exclusivity can be freely negotiated) from $40,000 per episode or per week in 2019 to “$65,000 for a half-hour program and $70,000 for an hour program.”⁹²

For non-star talent paid less than the exclusivity money break, “the minimum terms of the collective bargaining agreement . . . require that a series regular retain the right to do certain other work in addition to working on the series on which they are a regular.”⁹³ The Agreement grants them the ability to take on a second position as a series regular or miniseries lead and removes the condition that a guest appearance⁹⁴ may not be on a competing platform.⁹⁵ Netflix still “must approve the [guest] [a]ppearance and the series regular must confirm availability and scheduling with Netflix before accepting it.”⁹⁶ Netflix retains the ability to deny a guest appearance if the guest role is too similar to the actor’s Netflix role, and actors cannot make irreversible changes to their appearance (such as haircuts).⁹⁷ A minimum three-month “conflict free window” after each season, “during which the series regular may accept a [guest] [a]ppearance without first having to confirm availability or schedule with Netflix” has been established.⁹⁸ This conflict free window means that a series regular will not be held off the market during offseasons, even in an in-term exclusive talent contract. The guest appearance, however, must be completed during the conflict free window or all remaining work will be second to Netflix’s scheduling, reflecting the concern of studios regarding the coordination of many crew and cast member schedules.⁹⁹ Failure on Netflix’s end to provide this window would result in Netflix paying the series regular their episodic fee for the prior season during the window the actor is not able to compete.¹⁰⁰

Concessions on behalf of Netflix in the above Agreement were made in exchange for SAG-AGTRA’s withdrawal of a California bill that it had supported, AB-437, known as the Let Actors Work (LAW) Act.¹⁰¹ AB-437 would have sharply limited exclusivity in television deals in favor of allowing actors to work on competing networks “as long as ‘there is no material conflict of interest with their original employer,’ [and] . . . it [did] not conflict with the original show’s schedule.”¹⁰² At the time AB-437 was drafted, exclusivity terms in contracts often prohibited stars from appearing on competing networks, even during production breaks.¹⁰³ While “AB-437 passed the [California] Senate Judiciary Committee in a 9-1 vote,”¹⁰⁴ it was withdrawn prior to the close of the August 2022 Legislative session as a result of the SAG-AFTRA agreements with Netflix and AMPTP.¹⁰⁵

The 2022 Agreement between Netflix and SAG-AFTRA exemplifies the arguments both for and against exclusivity and the resulting tension, as concessions were made on each side of the bargaining table. As a result of the Agreement, the demands of an actor’s “exclusivity” during an offseason were reduced. If exclusivity terms for actors paid below the exclusivity money break must now allow a conflict free window during which an actor can accept other roles, these terms may—in practice—act more like noncompete agreements than exclusivity agreements, since even “exclusive” actors are able to work on other shows. This blurs the lines between exclusivity and in-term noncompete agreements. Simultaneously, the importance of ensuring talent’s availability has been acknowledged and protected with provisions granting Netflix first position rights for scheduling.

II. SECTION 16600 AND EDWARDS

A. Section 16600

Some states allow contractual noncompete agreements, provided they satisfy a certain reasonableness standard. California, however, takes a strong stance against the enforcement of noncompetes in favor of employee mobility. Section 16600 of the Code states, “Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.”¹⁰⁶ Section 16600 carves out an exception for noncompetes in the sale or dissolution of corporations, partnerships, and LLCs, allowing covenants not to compete “where a person sells the goodwill of a business and where a partner agrees not to compete in anticipation of the dissolution of a partnership.”¹⁰⁷ This exception ensures that those who purchase a business do not immediately face competition from the seller.

B. Edwards v. Arthur Andersen

Prior to 2008, a small number of cases (mainly federal) allowed narrow restraints on competition in California if they passed a “reasonableness” standard.¹⁰⁸ In 2008, the California Supreme Court rejected the Ninth Circuit’s narrow restraint approach to Section 16600 and articulated a single standard for noncompetes in Edwards v. Arthur Andersen LLP.¹⁰⁹

In 1997, Raymond Edwards II was hired as an accountant by the Los Angeles office of Arthur Andersen LLP, contingent on his signing a noncompete agreement that all managers were required to sign.¹¹⁰ The noncompete prohibited Edwards from performing similar services to any clients he had worked with in the eighteen months prior to his departure for another eighteen months after his release or resignation.¹¹¹ While Edwards was subject to a non-solicitation provision, he was not prohibited from accepting employment with clients.¹¹²

In 2003, shortly after Edwards’s employment at the firm was terminated, Edwards filed a complaint alleging that Andersen’s noncompete agreement violated Section 16600 and was thus unlawful.¹¹³ The trial court held that, since the noncompete was “narrowly tailored” and “did not deprive Edwards of his right to pursue his profession,” it did not violate Section 16600.¹¹⁴

The California Court of Appeals reversed, finding that the noncompete was invalid under Section 16600.¹¹⁵ The California Supreme Court agreed and explicitly rejected the “narrow-restraint” exception to Section 16600 used by the Ninth Circuit, stating that “California courts have not embraced the Ninth Circuit’s narrow-restraint exception.”¹¹⁶ The court discussed its policy rationale in favor of protecting Californians and ensuring that “every citizen shall retain the right to pursue any lawful employment and enterprise of their choice.”¹¹⁷ This means that even a narrow restriction on employment in a specific industry will be invalid under California law.¹¹⁸ As noted in Edwards, the California Legislature did not include language to narrow the application of Section 16600 to only overbroad or unreasonable restraints on competition, thus the court will not add those limitations unless expressly indicated by the legislature.¹¹⁹

While the text and notes of the Code do not specify whether Section 16600 should apply to current as well as former employees, there are nearly a hundred years of case law interpreting the Code in the context of post-term employment restrictions—during which no California state cases have applied the Code to in-term restraints on employment such as exclusivity provisions.¹²⁰ Accordingly, exclusivity provisions are used often in the talent industry to coordinate schedules among individuals involved in production.¹²¹ However, a recent Ninth Circuit case, ITN, may extend application of Section 16600 (California’s ban on noncompetes) to exclusivity in the acting industry.

III. CASE ANALYSIS

A. Exclusivity Analyzed Through the Lens of Section 16600

Since Edwards, Section 16600 “often operates as a per se rule against noncompete clauses in contracts,” prohibiting noncompete agreements in California regardless of whether they are narrowly tailored in favor of promoting open competition and employee mobility.¹²² As noted earlier, the vast majority of cases applying Section 16600 have been restricted to the post-term noncompete context. Therefore, in-term exclusivity agreements and noncompetes will typically be allowed if narrowly and fairly drafted, as parties often use in-term exclusivity to ensure loyalty and investment in employee development. In the acting industry, in-term exclusivity may be used to coordinate production schedules, make talent contracts more valuable, and prevent actors from simultaneously appearing in rival network platforms (assuming they are paid above the exclusivity money break). For films, these exclusivity provisions include services such as “preproduction (rehearsal, costume fittings, etc.), production (i.e. principal photography), postproduction (which may include special effects work, dubbing, and reshoots), and publicity for the film.”¹²³

Nevertheless, at least one recent Ninth Circuit decision (ITN) applying California law has extended Section 16600 to invalidate in-term noncompete agreements as well. This extension impacts not only in-term noncompetes, which limit an employee from working in a certain area, but also exclusivity provisions, which restrict an actor’s ability to work in other productions entirely. As in-term noncompetes are less restrictive than exclusivity provisions, the policy reasons in support of the Code’s extension to capture in-term noncompetes may capture exclusivity as well.

B. Section 16600 Application to In-Term Provisions

Following years of consistent judicial application by California courts, Section 16600 prohibits most post-term noncompete agreements. The more difficult inquiry is whether Section 16600 does or should apply to in-term exclusivity and noncompete agreements for actors. In 2021, the court for the Southern District of California summarized the precedent set by California courts that Section 16600 applies only to bars on post-employment, not in-term employment, competition in Youngevity Int’l, Corp. v. Smith: “Section ‘16600 does not apply to restrictions on a person’s ability to engage in a lawful business while that person is employed by the company to which he or she promised loyalty. . . . Rather, § 16600 targets restrictions on post-employment activity.’ ”¹²⁴ In-term prohibitions on competition have allowed employers to rely on an employee’s loyalty and commitment while employed.¹²⁵ Further, in Techno Lite, Inc. v Emcod, LLC (2020), the California Court of Appeals notes that “[a]ppellants do not cite—and we have not found—a single case in which Section 16600 was held to invalidate an agreement not to compete with one’s current employer while employed by that employer,” rejecting an argument that Section 16600 could apply to restrictions on employees while currently employed.¹²⁶

However, in 2017, the Ninth Circuit Court of Appeals applied California state law in ITN Flix, LLC v. Hinojosa to hold that Section 16600 does in fact apply to invalidate “in-term” noncompete clauses lasting only for the term of employment set by the contract.¹²⁷ If Section 16600 is extended to prohibit in-term noncompete and exclusivity terms (as is suggested by ITN), many existing practices in the entertainment industry could be legally vulnerable. In ITN, an actor’s Master License Agreement (“MLA”) and Acting Agreement (“AA”) were found to be void as unlawful restraints on trade since they limited the actor’s right to pursue lawful employment.¹²⁸ The actor had entered into the MLA and AA contracts after starring in a film franchise built around his “vigilante character” role.¹²⁹ The contracts limited the actor’s ability to play “vigilante characters” in other films, as well as his ability to appear in similar films from 2006 to 2013 (a term of seven years brushing against the outer limit of California’s “Seven Year Rule” for personal-service contracts).¹³⁰ The film was a box office flop.¹³¹ The actor then starred in a later film as a “vigilante character,” which was a commercial success.¹³² The producer of the original film, Medina, sued for the actor’s breach of contract and argued that the MLA and AA were valid contracts not to compete, as Section 16600 “does not apply to ‘in-term’ non-compete clauses that last only for the term of employment set by the contract.”¹³³

The court disagreed and said that “[u]nder Cal. Bus. & Prof. Code [Section] 16600, both the MLA and AA are void as unlawful restraints on trade because they limit the right of [the actor] to pursue lawful employment.”¹³⁴ In rejecting Medina’s argument that Section 16600 applies only to post-term noncompetes, the court stated—in no soft terms—that “[b]oth California courts and the Ninth Circuit have rejected [that] argument,” citing two cases in support of their bold statement that Section 16600 applies to invalidate in-term noncompetes: (1) Kelton v. Stravinski (a 2006 California Court of Appeals case) and (2) Comedy Club Inc. v Improv West Associates (a 2009 Ninth Circuit case).¹³⁵ Both of these cases, however, discuss noncompete agreements in contexts outside of the employment context—first the franchise context and later in partnerships—raising the question as to whether the court in ITN was stretching to find support for its policy stance.¹³⁶ California courts have explicitly stated that the “reasoning [in certain cases] is tied to the franchise context,” meaning a case involving a franchisor and franchisee is not directly analogous to a case involving an actor and their employer.¹³⁷ Thus, the extension of Section 16600 to in-term noncompetes does not seem to be supported by existing laws or cases.

First, Kelton involved two partners who developed industrial warehouses and thus had a partnership relationship as opposed to that of an employee and employer.¹³⁸ The partners had agreed to a covenant not to compete which prohibited them from building warehouses independently.¹³⁹ After one partner allegedly breached the covenant, the California Fifth District Court of Appeals held that the covenant was invalid under Section 16600, as it did not fall under any exceptions to the Code and “[i]n the partnership context, an ongoing business relationship [between the parties] does not validate the covenant [not to compete],” or create a Section 16600 exception.¹⁴⁰ Further, the partners in Kelton limited the fiduciary duties owed to one another to only those rising out of the Partnership’s property, explicitly stating that they had no “obligation to refer to the Partnership or to the other Partner any business opportunity,” and that “each partner could ‘engage in other real estate activities, . . . competitive with the Partnership or otherwise.’ ”¹⁴¹ This is significant, as a large policy reason for enforcing in-term noncompete covenants is the expectation of loyalty that accompanies them. Here, the partners expressly limited both their fiduciary duties and any expectations of loyalty regarding real-estate developments.¹⁴² This makes the facts in Kelton distinguishable from those in ITN, and, while cited as a supporting case for the application of Section 16600 to in-term noncompetes, support for ITN from Kelton is not strong due to the factual differences between a business partner and an employee.

The second case cited in ITN supporting the ban on in-term noncompetes in the employment context is Comedy Club Inc. v. Improv West Associates.¹⁴³ Comedy Club involved two businesses that agreed to an exclusive Trademark License Agreement, which was later breached.¹⁴⁴ The Ninth Circuit Court of Appeals stated that “an in-term covenant not to compete in a franchise-like agreement will be void if it ‘foreclose[s] competition in a substantial share’ of a business, trade, or market.”¹⁴⁵ However, the MLA and AA in ITN did not resemble a franchise agreement. While Comedy Club held the franchise’s in-term noncompete was invalid, Comedy Club involved two businesses in a franchise agreement—not an employee and an employer like in ITN.¹⁴⁶ Further, the Ninth Circuit in Comedy Club refused to void the entire in-term covenant.¹⁴⁷ Instead, it weighed the interests of the plaintiff in operating its business against those of the defendant seeking to protect its trade name and goodwill, creating a compromise which allowed the plaintiff to operate in certain areas in which the defendant did not already operate.¹⁴⁸

The Comedy Club court does note that “California courts are less willing to approve in-term covenants not to compete outside a franchise context because there is not a need ‘to protect and maintain [the franchisor’s] trademark, trade name and goodwill.’ ”¹⁴⁹ This suggests that in-term exclusivity provisions may be subject to some challenges if they are not drafted with appropriate terms.

Lastly, Medina argued that Section 16600 should not be applied to the entertainment industry, as it “would be unworkable because personal services contracts are so often needed to ensure the availability of celebrities.”¹⁵⁰ While the court was not persuaded by this argument, maintaining its stance that this noncompete was illegal regardless of scheduling implications, Medina’s argument touches on some of the most important issues that would stem from an extension of Section 16600 to in-term noncompetes.¹⁵¹ Scheduling work on large productions would be more difficult, potentially raising costs and slowing the pace of production. Further, studios have an interest in ensuring their stars do not accept similar roles in the same time frame during which their films are being released, as it could lower viewership and performance. It is also important to note that exclusive personal-service contracts today are the product of a freelance entertainment industry in which actors are cast for specific roles, as well as extensive collective-bargaining negotiations in which both actors and studios are represented. Actors need protection from exploitation, and unions (such as SAG-AFTRA) will go on strike to ensure actors’ interests are adequately represented in collective-bargaining negotiations. The resulting contracts are far less demanding than those that existed in the 1930s, and interference by the courts with the established system and the agreements that have resulted from it may raise more problems than solutions. It may be best to allow unions and studios to reach their desired outcomes without judicially imposed boundaries on in-term noncompete agreements.

One way to reconcile the outcome of ITN with the overwhelming enforcement of in-term noncompetes is by treating the MLA and AA as post-term noncompete agreements. While the court said the actor’s contract was an in-term prohibition, it is possible that it actually categorized the MLA and AA as post-term noncompete contracts and treated them as such, since both restricted the actor’s work after the film was released. Thus, the contracts may have been post-term prohibitions on competition and invalid for that reason, despite the courts “in-term” language. This would allow the result in ITN to be accurate while maintaining the concept of exclusivity. Further, the importance of this distinction highlights the nuances and gray areas that exist in an actor’s contract. A contract may be “in-term” if it applies for a set number of years or seasons of a show, while also operating as “post-term” if it continues to limit the actor after filming has wrapped and an actor’s services are no longer actively needed.

Another possibility is that the Ninth Circuit in ITN simply incorrectly overapplied Section 16600 in an effort to show its recognition of California case law as distinguished from the more lenient noncompete laws of other states in the Ninth Circuit. In the past, the Ninth Circuit has issued certified questions to the California Supreme Court regarding noncompetes, as it did in Ixchel Pharma v. Biogen, asking how broad Section 16600 is in its reach.¹⁵² Further, in 2008, the California Supreme Court had explicitly rejected the “narrow-restraint” exception previously used by the Ninth Circuit.¹⁵³ The Ninth Circuit therefore may have improperly applied Section 16600 due to confusion regarding the scope of the Section or in an effort to show its recognition of California law as distinguished from other states in the Ninth Circuit.

ITN may also suggest that certain situations in the acting industry can trigger the application of Section 16600 to hold an in-term noncompete invalid if it is unduly harsh. The actor’s contracts, while technically within the seven years allowed for a personal-service contract in California, were at the outer limits as they lasted for a full seven years. Perhaps a shorter period, such as three or four years, would have led the court to reach a different conclusion.

Despite the plausible explanations above reconciling ITN with existing California case law, ITN is likely an outlier on the treatment of in-term noncompetes in California. In Edwards, the Supreme Court of California invalidated a noncompete agreement that forbade a former employee from working with certain clients and soliciting other employees for periods of twelve to eighteen months after his employment terminated.¹⁵⁴ The Supreme Court “did not address—much less invalidate—agreements by employees not to undermine their employer’s business by surreptitiously competing with it while being paid by the employer.”¹⁵⁵ This suggests that if an employee is still being paid, in-term noncompetes are entirely valid. As the California Supreme Court has not weighed in on the treatment of in-term noncompete agreements, its deferential stance in Edwards to legislative intent signals that it may be waiting for clarification from the lawmaking branches of the California government before extending Section 16600 to in-term covenants. Further, the transition away from the studio system of the 1930s (in which actors were held off the market for long periods of time) to the freelance model of talent contracts today, accompanied with the introduction of the “Seven Year Rule” in California, has put in place protections for actors that seem to absolve the need for any total ban on exclusivity or in-term noncompete agreements.

C. Section 16600 Application to Post-Term Noncompete Provisions

It is generally accepted that Section 16600 prohibits post-term noncompete provisions in California.¹⁵⁶ Post-term noncompetes prevent former employees from working for a competitor or soliciting clients for a certain amount of time.¹⁵⁷ Most cases interpreting Section 16600 under California law fall in this post-employment context, as the statute has consistently invalidated covenants not to compete that interfere with an employee’s ability to compete after they cut ties with a former employer.¹⁵⁸

Post-term noncompete clauses in the entertainment industry are not common but might include provisions forbidding an actor from working in a production associated with a rival television network or film studio, even after all work has been completed for the current role. Terms with similar effects, however, may be included in the contracts of megastars preventing them from accepting roles with competing studios.¹⁵⁹ This represents the unique gray area in talent contracts, in which it appears an actor has completed a term of their contract (as filming for the movie is done), yet the actor may have a three-picture contract bringing these terms within the scope of in-term exclusivity.

Interestingly, the LA County Superior Court seems to take the stance that post-term noncompete agreements are valid in the narrow fixed-term employment context where an employee leaves in the 2020 case Viacom v. Netflix.¹⁶⁰ This is particularly relevant in the acting industry, in which talent contracts are generally for a set term as opposed to at will. The holding of Viacom, applied to talent contracts, suggests that noncompete agreements restricting an actor’s ability to accept roles after a contract has ended could actually be valid where the actor is the party that breaches the contract. In Viacom, an executive employed by Viacom (an entertainment company) with a fixed-term employment contract left her job nineteen months prior to the end of her contract to work for Netflix.¹⁶¹ Viacom sued Netflix, seeking a permanent injunction enjoining Netflix from taking its employees in this manner, as well as damages.¹⁶² The disputed noncompete provisions from the executive’s employment agreement read

Your employment with the Company is on an exclusive and full-time basis, and while you are employed by the Company, you shall not engage in any other business activity which is in conflict with your duties and obligations (including your commitment of time) to the Company . . . .
The “Non-Competition Period” begins on the Effective Date and ends on the last day of the Contract Period, provided that:
1. If the Company terminates your employment without Cause before the end of the Contract Period, then the Non-Competition Period shall end on the earlier of (i) the end of the period in which you are receiving payments pursuant to paragraph 11(b)(i) or (ii) the effective date of your waiver in writing of any right to receive or continue to receive compensation and benefits under paragraph 11. You shall be deemed to have irrevocably provided such waiver if you accept competing employment.
2. If the Company terminates your employment for Cause or you resign, the Non-Competition Period shall end on the earlier of (i) the last day of the Contract Period or (ii) eighteen (18) months after such termination or resignation.¹⁶³

While Netflix argued that the covenant was an unlawful prohibition preventing the employee from working in similar positions for eighteen months post-employment, the court disagreed.¹⁶⁴ The court stated that there is no case law supporting the argument that fixed-term contracts not to compete are invalid given that the employee voluntarily left Viacom under assurance from Netflix that she would be indemnified and would not have to pay legal fees.¹⁶⁵ While Section 16600 would invalidate the noncompete if the employee had been terminated by Viacom, this case suggests that a noncompete provision for a set amount of time will be upheld where the employee voluntarily leaves their position.¹⁶⁶ Applied to talent contracts, actors who sign fixed-term exclusivity and noncompete contracts for the filming of their television shows or films may have agreed to valid noncompete provisions in the case that an actor quits in order to pursue a different role, regardless of whether the noncompete becomes post-term.

In Viacom, the noncompete was valid because the employee was not terminated but chose to leave to work for a competitor, thus forsaking her position and its salary voluntarily.¹⁶⁷ Had the employee instead been terminated, Section 16600 would undoubtedly be implicated.¹⁶⁸ Additionally, the court notes that at will employment contracts (as opposed to fixed term) with identical language would prove to be unlawful.¹⁶⁹ This raises an interesting question regarding option contracts.¹⁷⁰ Further, it seems as though the court wanted to hold for Netflix from a policy perspective.¹⁷¹ The court expressly stated that it believes Viacom’s fixed-term employment contracts may violate Section 16600, but that it is unable to find binding case law in support of this position.¹⁷² This is an interesting narrowing of Section 16600 in finding post-term noncompete terms legal in the situation in which an employee leaves, with particular application to the acting industry where the actor will typically be the one breaching an exclusivity provision in order to render outside work. While helpful in noting that California case law does not suggest that exclusivity in a fixed-term contract is unlawful, this is a Superior Court case and is thus not binding.¹⁷³ The court itself seems to struggle with the outcome and is perhaps expressing its struggle with existing precedent in an effort to open the door for the California Supreme Court to weigh in on the matter.

Steinberg Moorad & Dunn, Inc. v. Dunn, an unpublished 2005 Ninth Circuit case referenced in Viacom, takes the view that a post-term noncompete is invalid regardless of whether the employee left or was fired: “[w]hen an employee leaves, be it before the term of employment has ended or not, [S]ection 16600 prohibits the employer from preventing that employee from pursuing his trade.”¹⁷⁴ The Viacom court states that, while it would like to rely on Steinberg as persuasive, it is unable to do so because, as an unpublished case, it lacks the specific facts needed to analyze Viacom’s noncompete clause.¹⁷⁵ This further suggests that some direction is needed from the higher state courts in California or the legislative branch on the application of Section 16600 when an employee is the one to cut ties with the employer in a fixed-term exclusivity contract.

While Viacom represents a narrow application of Section 16600 to allow post-term noncompetes, the application is important in certain contexts such as Silicon Valley where technology companies are constantly poaching employees with key information regarding data breakthroughs such as self-driving car technology.¹⁷⁶ However, the nuanced application of the Code to the general prohibition on post-term noncompetes (allowing them where the employee leaves a fixed-term contract) may have unintended consequences by restricting the movement of talent in the acting industry.

D. Factors Unique to the Entertainment Industry

In determining whether Section 16600 should apply to noncompetes in talent contracts, perhaps talent contracts should be evaluated under a unique standard that considers the nuanced aspects of acting, such as fame. Are actors distinct from other employees whose in-term noncompetes in California are valid? As touched on in the discussion of ITN above, a gray area exists within noncompetes in which a contract may be ongoing, but an actor is no longer actively working on a project. A theoretical argument can be made that fame should play a role in the analysis. While most employees merely provide labor, actors are involved in a finished product, the value of which may turn on an actor’s reputation. This is particularly relevant when an actor is a widely recognized celebrity, known for their portrayal of certain characters or for a certain genre. For example, horror films or children’s films. Perhaps an actor is different from a typical employee in that the subsequent work of a “famous” actor could impact their image, and in turn, the value of the character created in a series or film owned by the studio. If this is the case, fame could be an important factor in the analysis of exclusivity provisions. While the actions of a little-known actor after a film or series airs will likely be inconsequential, the press surrounding a major celebrity may have a large impact on the success of a program.

This can be exemplified by the controversy surrounding Daniel Radcliffe’s involvement in Equus, a play in which Radcliffe appeared “full-frontally nude in a prolonged scene.”¹⁷⁷ Following Radcliffe’s nude appearance in the play, press speculated whether the star of the Harry Potter film franchise would be denied the role in the last two films, as the franchise was widely popular with children. One comment on a Harry Potter fan site following news of Radcliffe’s role in Equus with mature scenes read, “We as parents feel Daniel should not appear nude. Our nine-year-old son looks up to him as a role model. We are very disappointed and will avoid the future movies he makes.”¹⁷⁸

On the other hand, Daniel Radcliffe’s role in Equus did not seem to hinder the success of the final two Harry Potter movies, as “[t]he eighth and final Harry Potter movie was . . . the third-biggest movie of all time behind only Titanic . . . and Avatar,” bringing in $1.342 billion in the global box office.¹⁷⁹ If viewers do not place substantial weight on an actor and instead focus on the character portrayed, the argument that fame should be factored into the legality of post-term exclusivity terms is substantially weaker.

IV. SUMMARY OF CASE ANALYSIS

Analyzed through the lens of Section 16600, in-term noncompetes and exclusivity provisions in the acting industry seem to fall outside the scope of the Code’s prohibition of post-term noncompetes and are thus, at least in the general sense, legal. This does not mean, however, that the line is clear-cut or that all in-term noncompete and exclusivity clauses are watertight in their legality. Some in-term noncompete provisions may be prohibited if they are too broad in their restrictions or if they are not well-drafted. The Ninth Circuit’s application of California law in ITN exemplifies a court’s refusal to enforce an actor’s exclusive MLA and AA agreements even for in-term contracts, as the studio’s ban on the actor playing other “vigilante characters” for seven years was an illegal prohibition on the actor’s right to work. While this case is an outlier in an otherwise mostly unified interpretation of Section 16600’s application to post-term noncompete provisions, it indicates that in some instances, reasonableness and length of a contract may still be used to judge the legality of an in-term noncompete agreement.

Conversely, post-term exclusivity provisions are exactly what the California Code was designed to prevent and are generally illegal, except (as Viacom suggests) perhaps in the narrow situation where the employee voluntarily leaves the employer. In California, an employer cannot prohibit a former employee from working after they have left. Viacom interprets the Code, however, as allowing noncompetes in fixed-term employment contracts where the employee voluntarily leaves but prohibiting them when it comes to at will contracts with no end date. It is notable that the court in Viacom, however, believes that these contracts are perhaps illegal but is unable to hold that they are due to the lack of precedential case law on the matter. This may be a signal that it is time for the California Supreme Court to weigh in on the distinction between post-term and in-term exclusivity provisions under Section 16600 and explain that—as currently written and interpreted—it does not extend to invalidate in-term exclusivity and noncompete agreements. The California Supreme Court may also need to articulate whether post-term noncompetes are allowed in the narrow situation where an employee voluntarily leaves.

Another interesting distinction can be made between actors and nonactor employees; while actors are classified as employees, they are distinct due to their fame and their reputational value that has the potential to impact a final work product. This may support the theoretical argument that fame should be considered in analyzing exclusivity and noncompetes. However, if viewers can separate an actor from the roles they play, this may not be an issue.

The table below summarizes the standard from the majority of California cases interpreting Section 16600.

Figure 1.

Section 16600

In-Term Exclusivity

Post-Term Exclusivity

Exclusivity terms are heavily negotiated in television talent contracts, yet not heavily negotiated film talent contracts.

Typically legal if narrow in scope and well-drafted.

Often illegal if at will.

Potentially illegal if Section 16600 is extended to invalidate restrictive in-term exclusivity.

(ITN)

Potentially legal if fixed-term and the employee voluntarily leaves.

(Viacom)

CONCLUSION

California is firm in its stance against post-term noncompetes, yet an acting industry specific analysis suggests that the unique attributes of talent contracts may require a more nuanced approach. The rise of online streaming has changed the demands placed on actors, with shorter series seasons contributing to an increase in idle time. The landscape is changing rapidly, resulting in the frequent renegotiation of terms and resulting standstills, exemplified by the 2023 SAG-AFTRA strike.

The in-term and post-term treatment of exclusivity provisions and noncompetes has received conflicting treatment by California and Ninth Circuit Courts, suggesting that perhaps the California Supreme Court should weigh in on the matter as they did in 2008 with Edwards and articulate whether Section 16600 can apply to in-term noncompete and exclusivity provisions.¹⁸⁰ While it is widely held that Section 16600 does not apply to in-term noncompetes, the holding in ITN suggests that certain situations in the acting industry may trigger its application and deem an in-term noncompete invalid if unduly harsh.¹⁸¹

Viacom suggests that in certain instances where an employee breaches a fixed-term exclusivity provision, post-term noncompetes may be upheld. Regardless, the ability of actors and unions to negotiate with studios for mutually beneficial terms has allowed common practices in entertainment contracts to shift over time without much recent legislation. This suggests that, while the applicable law will provide one side with bargaining power, negotiations and collective-bargaining agreements will largely continue to set the standards for common entertainment contract practices.

97 S. Cal. L. Rev. 1087

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Katarina Ulich*

* J.D. Candidate 2024, University of Southern California Gould School of Law. To my parents, thank you for being my best friends and biggest supporters.

Perfecting the Judicial Peremptory Challenge: A New Approach Using Preliminary Data on California Judges in 2021

May 2024July 2024Sarah Park*

Even the most carefully planned and genius strategies are pointless without an assumption of fairness: chess depends on a fair arbiter, soccer depends on a fair referee, and litigation depends on a fair judge. Just as arbiters and referees are frequently criticized for questionable decisions, judges also deal with accusations that bias has impermissibly clouded their judgment. To protect litigants, the California Legislature presented a solution—the California Code of Civil Procedure section 170.6, a statute arming litigants with the option to replace their assigned judge if they declare that judge biased. This judicial peremptory challenge asks for no evidence of bias, further frustrating the disagreement between proponents who claim that this right will trigger a chain reaction to increased public confidence and decreased discrimination against litigants, and opponents who conversely warn that it will open a Pandora’s box of abuse, intimidation, and discrimination against innocent judges. The difficulty of constraining various harmful human tendencies is the problem of judicial peremptory challenges writ large.

It appears that much of this policy debate about judicial peremptory disqualification is informed by theory rather than empirical data. The study conducted by this Note reveals that, at least in 2021, (1) peremptory challenges do not occur often but abuse still occurs among the few times they are asserted, and (2) timing and form rules are weak procedural obstacles. My proposal acknowledges that judges are sometimes not the epitome of neutrality but takes issue with litigants who may inflict damage on undeserving judges and the adjudication generally. Instead of the current “no-questions-asked” regime, the recommended procedure is the following: after litigants receive judicial analytics, they can file the disqualification motion with an independent judge who will review both the motion and the challenged judge’s evidentiary explanation for factual and legal sufficiency. Admittedly, like its federal counterpart, this is not peremptory per se, but it is preferrable as it will perfect the peremptory challenge and diminish the risk of abuse even more than the current model.

INTRODUCTION

There is in each of us a stream of tendency, whether you choose to call it philosophy or not, which gives coherence and direction to thought and action. Judges cannot escape that current any more than other mortals.

—Justice Cardozo¹

The Lady Justice sculptures that adorn the United States Supreme Court building serve as a reminder of the high standards to which we hold judges: her blindfold and scales represent unwavering impartiality.² But juxtaposing Lady Justice, a godlike figure from ancient mythology,³ with judges, human beings vulnerable to inevitable fallibility,⁴ begs the question of whether these standards are unattainable ideals. What happens when judges cannot wear the blindfold and hold the scales yet still wield the sword symbolizing power?⁵ The California Legislature responded to this reality by enacting California Code of Civil Procedure section 170.6 (“Section 170.6”) which grants judicial peremptory⁶ challenges, or the power to automatically disqualify a judge for bias even without any evidence of such bias, to litigants.⁷ Given that plaintiffs and defendants in the United States bear the burden of proof to succeed in their claims and defenses respectively, the significance of this exceptional legal right is apparent. But the California Legislature was not blind to the potential for this statute to act as a double-edged sword:⁸ litigants and their attorneys are naturally inclined to exploit this power to “shop” for a judge that is likely to favor their cause.⁹ This cost-benefit analysis (“judge shopping,” which seems contradictory to the very essence of judging, weighed against public confidence in the judiciary) still plagues practitioners, legal academics, and judges today, decades after Section 170.6 was added to the California Code of Civil Procedure.

Although peremptory challenges are more commonly associated with jurors rather than judges,¹⁰ the ability to change the assigned judge cannot be understated. The jury has indisputable influence over a case’s outcome by “mak[ing] findings of fact and render[ing] a verdict for [] trial.”¹¹ Indeed, the foundational right to a judgment by one’s peers in the community dates back to the Magna Carta.¹² Nonetheless, the judge still decides questions of law¹³ and thus arguably holds equal, if not more, influence than the jury.¹⁴ This is especially so given all cases have a judge but not all of them have a jury.¹⁵ Moreover, a majority of cases do not proceed to trial: a judge’s ruling on a summary judgment motion has a conclusory effect akin to the end of trial.¹⁶ Even if a case reaches trial, a successful motion for judgment as a matter of law¹⁷ or a motion for new trial¹⁸ can subvert the jury’s verdict.

Considering judges’ unparalleled authority over litigants’ fate, notwithstanding the jury’s role, it is no surprise that judges must not “manifest bias . . . including but not limited to bias . . . based upon race, sex, gender, religion, national origin, ethnicity, disability, age, sexual orientation, marital status, socioeconomic status, or political affiliation . . . .”¹⁹ Judicial independence not only has a rich history predating Enlightenment philosophy,²⁰ but is also at the core of national identity in the United States: former President Adams, one of the Founding Fathers, wrote about the right to trial by “judges as free, impartial, and independent as the lot of humanity will admit” in the original Massachusetts Constitution.²¹ Judges are supposed to represent the best of human nature, maintaining superior morals and ethics. This image erodes when judges rule with regard to “which side is popular” and “who is ‘favored.’ ”²² Impartiality in the courts is not a mere exercise in political correctness but a vital component of a fair, just, and democratic society rid of corruption. Once the public no longer trusts judges to treat them equally with their adversary, a domino effect to anarchy may ensue whereby people will stop respecting and therefore complying with orders from the judiciary and government at large. However, judicial discretion is as crucial to the proper functioning of the legal system as judicial impartiality because indeterminate laws require judges to “consider practical consequences and the overall context of a matter.”²³ Alexander Hamilton, one of the Framers of the U.S. Constitution, distinguished between the “guided exercise of discretion” and the “imposition of personal will and preference” by highlighting the “importance of courageous judges to the preservation of individual liberty and to the amelioration of oppressive legislation.”²⁴

Ideally, litigants would always use Section 170.6 in good faith to defend themselves from judicial bias. Unfortunately, courts confront the ironic truth that some litigants abuse this ability as an offensive maneuver instead. Litigants may take advantage of peremptory challenges to substitute their judge with one that has aligned interests—that is, a biased judge. Section 170.6 can accordingly exacerbate the very problem it was designed to minimize. Bias is a two-way street in which litigants can also discriminate against judges of a particular gender, race, or ethnicity, among other demographics. There was increased legislative movement toward eliminating peremptory juror challenges for this reason in 2021²⁵ and publicity on race-based discrimination in jury selection in 2022.²⁶ If attorneys can discriminate against potential jury members, they can discriminate against judges as well, and the legal field should brace for any future spillover on peremptory challenges to judges. In 2022, 60.1% of judges in California were male, and 61.4% of them were white.²⁷ Imagine the harm that would result if most of the disqualified judges were members of groups that have historically endured discrimination. The judiciary would subsequently lose the diversity of thought and experiences necessary to adequately understand and evaluate heterogeneous litigants from the United States, a country often referred to as a melting pot.

This Note illustrates the need to abandon the judicial peremptory challenge as it exists today and instead opt for a blend of other variations—specifically, the challenge should be less peremptory and more stringent. Preliminary empirical data in 2021 reveals that (1) peremptory challenges do not occur frequently but abuse still occurs among the few times they are asserted, and (2) timing and form rules are weak procedural obstacles. Although the challenge is not widely abused, a different model will decrease the incidences of abuse even further. In lieu of a conclusory allegation of bias that is instantaneously granted, the proposed disqualification approach allows the challenged judge to refute the allegation with evidentiary explanations. This will hopefully pull the reins on the litigants, however few, who make an unwarranted, illusory charge of bias against their judge in order to gain a tactical advantage.

This Note begins by providing a high-level overview of how peremptory challenges to judges are treated by federal courts and other state courts besides California. It also explores Section 170.6 in detail, particularly the statute’s legislative history and interplay with judicial rules and peremptory juror challenges. Next, it summarizes the current policy arguments both in favor and against peremptory disqualification of judges: points of contention include discrimination against judges and confidence in the judiciary, among others. It continues with an analysis of data collected from every order in 2021 in which a California superior court judge decided on a Section 170.6 motion, tracking for the number of filed motions, number of denied motions and why they were rejected, number of disqualified judges, and the disqualified judges’ political party. It then synthesizes the findings with judicial disciplinary actions due to bias in 2021, which informs the policy debate by revealing the concerns that actually come to fruition in practice, rather than in theory only, at least in the context of California for this time frame. It additionally explores the reasons behind challenging a judge using The Robing Room, a public forum. Afterwards, it discusses alternative disqualification procedures offered by some legal scholars before advocating a new approach. Finally, the Note ends with recommendations for future research.

I. MODERN LAW OF JUDICIAL PEREMPTORY DISQUALIFICATION

Section 170.6 is a relatively recent addition to judicial disqualification law²⁸—the decades since its enactment pale in comparison to the more than one thousand years people have spent developing legal justifications for disqualifying judges.²⁹ In the mid-eighteenth century, the thirteen American colonies adopted English jurisprudence that,³⁰ unlike civil law countries, narrowed the scope of judicial disqualification so that a judge could only face disqualification if they had a direct pecuniary interest in the case.³¹ Thus, lacking basis in common law,³² disqualification for bias did not enter the stage until 1903, well after the founding of the United States, when Montana’s legislature answered the cries of a losing litigant.³³ This win for victims of judicial bias was part of a growing focus on ensuring that judges apply the law in an evenhanded manner,³⁴ eventually escalating into the federal law’s official acknowledgment.³⁵ The evolution of judicial disqualification finds itself at a fork in the road: some states in the West and Midwest, including California, allow disqualification with an allegation of bias alone—known as a peremptory challenge—while other states in the East and South join the federal courts in imposing stricter standards by requiring support for the allegation as well.³⁶

A. Federal Law

In 1911, 28 U.S.C. § 144 introduced judicial peremptory challenges into the federal realm.³⁷ This federal statute closely mirrors Section 170.6 as it permits the disqualification of a district court judge upon a timely affidavit claiming bias. However, it departs from Section 170.6 in a significant way: it requires the affidavit to “state the facts and the reasons for the belief that bias or prejudice exists” and accordingly affords less leeway to litigants.³⁸ On its face, its wording and legislative history hint at the intent for peremptory disqualification;³⁹ judicial interpretation steered it on the opposite trajectory.⁴⁰ After the Supreme Court in Berger v. United States opined that the challenged judge may conduct a hearing to scrutinize the alleged facts for legal sufficiency,⁴¹ the Court clarified in Liteky v. United States that “expressions of impatience, dissatisfaction, annoyance, and even anger, that are within the bounds of what imperfect men and women, even after having been confirmed as federal judges, sometimes display” fall short of bias.⁴² The latter case defined the extrajudicial source doctrine: critical, disapproving, or hostile opinions based on facts or events during the proceedings do not warrant disqualification unless “they reveal such a high degree of favoritism or antagonism as to make fair judgment impossible.”⁴³ Congress largely acquiesced to this rejection of peremptory intent lest they infringe upon the separation of powers by attempting to regulate the judiciary.⁴⁴ As a result, “disqualification under [28 U.S.C. § 144] has been rare.”⁴⁵ Naturally, the statute could no longer be classified as fully peremptory, distinguishing it from its state counterparts that order automatic disqualification, like Section 170.6.

B. California Law

1. California Code of Civil Procedure Section 170.6

In 1957, the California legislature debated whether to accept or deny the legacy of judicial peremptory challenges and ultimately concluded with the birth of Section 170.6 through an “overwhelming vote of both houses of the Legislature” and approval by the Governor.⁴⁶ The legislation was more radical⁴⁷ than California Code of Civil Procedure section 170.1 which concerns challenges for cause⁴⁸ and California Code of Civil Procedure section 170.5 (added as section 170.4 in 1897), which addresses bias as a ground for disqualification.⁴⁹ This was not the first time the Legislature dealt with judicial peremptory challenges: four previous measures failed to receive executive approval despite passage by the Legislature.⁵⁰ Therefore, Johnson v. Superior Court, the first case to apply Section 170.6, acknowledged how the “[s]tate [b]ar and the Legislature have long felt that there is a need for such a measure.”⁵¹

Unlike federal judges under 28 U.S.C. § 144, California judges generally fortified Section 170.6 by “liberally constru[ing it] with a view to effect its objects and to promote justice,”⁵² starting with its constitutionality. Since the constitutionality of peremptorily disqualifying a judge has been debated since the early twentieth century,⁵³ it comes as no surprise that Section 170.6 came under attack almost immediately after its enactment. Even before the Legislature took action, the courts in the state ruled in several cases that a similar disqualification statute enacted in 1937 was unconstitutional.⁵⁴ Johnson represented a turning point as the Supreme Court of California deemed Section 170.6 constitutional and overruled the lower court’s decision that “the statute makes an unconstitutional delegation of legislative and judicial powers to litigants and their attorneys and is an unwarranted interference with the powers of the courts.”⁵⁵ Section 170.6 is materially different from its unconstitutional predecessor because it calls for litigants to submit a sworn statement instead of a “judicial determination of the existence of the fact.”⁵⁶ According to the court, Section 170.6 complies with the Constitution and deserves protection because “[p]rejudice, being a state of mind, is very difficult to prove, and, when a judge asserts that he is unbiased, courts are naturally reluctant to determine that he is prejudiced.”⁵⁷ About twenty years later, Section 170.6’s constitutionality returned to the forefront in Solberg v. Superior Court—this court found no separation of powers violation under California Constitution Article III, Section 3.⁵⁸ In a post-Johnson and Solberg world, the conversation between Section 170.6’s proponents and opponents has shifted away from constitutionality, but policy concerns persist. As this Note will later discuss, the thousand-year-old debate has still not found its rest.

Section 170.6 was amended to widen its scope: beginning in 1959, the statute extended to criminal, not just civil, cases,⁵⁹ and beginning in 1961, oral statements under oath, not just written documents.⁶⁰ This trend halted in 1965, when the Legislature forbade litigants from receiving a judicial reassignment if their original judge already presided over a proceeding prior to trial that involved a “determination of contested fact issues relating to the merits.”⁶¹ For the next ten or so years, the statute was only amended twice—in 1967⁶² and 1976⁶³—to subject court commissioners and referees to potential peremptory disqualification as well.⁶⁴ The Legislature obviously did not shy away from its peremptory intent, given that the affidavit form was amended in 1981 to add “peremptory challenge.”⁶⁵ After another amendment in 1982 that clarified the timeliness requirement for single-judge systems,⁶⁶ the statute was expanded yet again in 1985. Now, litigants who file an appeal that results in the reversal of the trial court’s judgment qualify for protection if the “trial judge in the prior proceeding is assigned to conduct a new trial on the matter.”⁶⁷ Timeliness was then defined as ten days for criminal cases with an all-purpose assignment in 1989.⁶⁸ The following two amendments in 1998⁶⁹ and 2002⁷⁰ responded to modifications of the California Constitution—the elimination of the justice court⁷¹ and unification of the municipal and superior courts, respectively⁷²—which were products of the Legislature’s “stead[y] move[ment] towards completion of the courts’ restructuring.”⁷³ In 2003, the Legislature merely maintained the codes⁷⁴ and did not make any substantive changes.⁷⁵ The last amendment, in 2010, made similar corrections, but also extended the filing deadline for civil cases with an all-purpose assignment to fifteen days after receiving notice of the assignment⁷⁶ and “codif[ied] existing court practices by requiring the party making the challenge to notify all other parties within five days after making the motion [to peremptorily disqualify the judge].”⁷⁷

In general, Section 170.6 guarantees litigants the extraordinary right to have an alternate superior court judge hear their matter once they accuse their judge⁷⁸ of bias, even without any factual basis for actual bias.⁷⁹ Litigants can raise a challenge under Section 170.6 at any trial, special proceeding, or hearing involving a “contested issue of law or fact,”⁸⁰ including trial, law and motion proceedings, injunction hearings, and contested probate or family law proceedings, but excluding settlement or case management conferences.⁸¹ Each side in a case, defined by whether the co-plaintiffs or co-defendants have substantially adverse interests,⁸² is given one challenge—the norm.⁸³ “[I]f the trial judge in the prior proceeding is assigned to conduct a new trial⁸⁴ on the matter” after “reversal on appeal of a trial court’s final judgment,” the movant can still use Section 170.6 regardless of whether they have already availed themselves of this procedure.⁸⁵ They, however, cannot make the motion “for the first time in post-trial matters which are essentially a ‘continuation’ of the main proceeding,”⁸⁶ meaning “action[s] . . . involv[ing] ‘substantially the same issues’ and ‘matters necessarily relevant and material to the issues involved in the original action.’ ”⁸⁷ Absent good cause, there is no continuance of the trial or hearing because of the motion; if a continuance is granted for other reasons, the matter must be continued for limited periods to be reassigned as soon as possible.⁸⁸ In the aftermath of the 2010 amendment, civil litigants must serve notice on all parties within five days of making the motion.⁸⁹

Either an affidavit accompanied with a declaration that a “fair and impartial hearing or trial cannot take place” under penalty of perjury⁹⁰ or an oral motion under oath will suffice as long as it is made before the hearing or trial commences.⁹¹ Litigants should submit the written or oral motion “as soon as possible after [they] know[] with some reasonable certainty who the actual trial judge will be”⁹² and must take care to abide by the timing rules governing master calendar, all-purpose, and single-judge systems. Table 1 below describes each of these various case-management systems and their nuances:

Table 1.
Case-Management System	Definition	Rules
Master Calendar	The case is assigned to different departments for specific types of matters.^a	The litigant should make the motion to the judge supervising the master calendar. When the case is set for immediate trial, litigants are instructed to make their challenge at the time of assignment, but when the case is set for a later trial date, they should comply with the 10-day/5-day rule.^bThe 10-day/5-day rule dictates that a litigant must make their challenge at least five days before the trial or hearing date if the judge’s identity is known at least ten days before the trial or hearing date.^c If they wait until they appear before the judge, they will have essentially waived their right to challenge that judge.^d However, a late-appearing or late-named party will not be penalized as long as they make the motion within ten days after their appearance.^e
All-Purpose/ Direct-Calendar	The randomly assigned judge “maintain[s] [their] own calendar, set[s] and handl[es] all motions and other proceedings, and conduct[s] trial.”^f At the time of the assignment, the judge must be expected to process all substantial matters in addition to trial.^g	Once a civil litigant receives notice^h of an all-purpose assignment, they have fifteen days to make their challenge.ⁱ If the litigant receives service by mail, they are entitled to a five-day extension.^j However, if the litigant has not yet appeared, they have fifteen days after their appearance.^k For a criminal litigant, they have ten days instead of fifteen days.^l
Single-Judge	There is only one judge in the courts.^m	A litigant must make their challenge within thirty days after they first appear in the action.ⁿ
Sources: ^aO’Connor’s California Practice Civil Pretrial, supra note 48, at Ch. 3-E § 3.3(2)(a). ^bSee, e.g., People v. Roerman, 10 Cal. Rptr. 870, 878–79 (Ct. App. 1961) (rejecting the motion because it was not made until the day trial was scheduled to begin even though the case was calendared to the judge for more than a month). ^cE.g., Eagle Maint. & Supply Co. v. Superior Ct., 16 Cal. Rptr. 745, 747 (Ct. App. 1961). ^dSee, e.g., Michaels v. Superior Ct., 7 Cal. Rptr. 858, 860–61 (Ct. App. 1960); Peremptory Challenges to a Judge in California, L. Off. of Stimmel, Stimmel & Roeser, https://stimmel-law.com/en/articles/peremptory-challenges-judge-california [https://perma.cc.6NLU-5PLS]. ^eSch. Dist. of Okaloosa Cnty v. Superior Ct., 68 Cal. Rptr. 2d 612, 612 (Ct. App. 1997). ^fO’Connor’s California Practice Civil Pretrial, supra note 48, at Ch. 3-E § 3.3(2)(b). ^gSee, e.g., People v. Superior Ct. (Lavi), 847 P.2d 1031, 1043 (Cal. 1993). ^hAccording to the opinion of Cybermedia, Inc. v. Superior Ct., 82 Cal. Rptr. 2d 126, 127 (Ct. App. 1999), notice should reference the case name and full case number and be addressed to the attorney if the party is represented; otherwise, it is insufficient. ⁱCal. Civ. Proc. Code § 170.6(a)(2) (Deering 2023). ^jMotion Picture & Television Fund Hosp. v. Superior Ct., 105 Cal. Rptr. 2d 872, 876 (Ct. App. 2001). ^kCiv. Proc. § 170.6(a)(2). ^lId. ^mO’Connor’s California Practice Civil Pretrial, supra note 48, at Ch. 3-E § 3.3(2)(b). ⁿSee, e.g., People v. Superior Ct. (Smith), 235 Cal. Rptr. 482, 484 (Ct. App. 1987) (refusing the movant’s argument that their motion was timely because it was made within thirty days after their attorney’s first appearance).

If litigants who successfully appeal the trial court’s judgment end up with the same trial judge, they must make the motion “within [sixty] days after the party or the party’s attorney has been notified of the assignment,”⁹³ or else it will be time-barred. The motion must be directed to the very judge under attack (the particular department will not suffice) who will then determine if it has been duly presented.⁹⁴

There are compelling policy reasons for these rules, namely that both litigants who “wish[] to postpone [the] motion until [they are] fully informed” and the court that needs “time to make adjustments after a disqualification” are satisfied.⁹⁵ Also, criminal litigants have less time to submit their motions than civil litigants because, like the Legislature probably thought, there are heightened concerns of abuse in criminal cases⁹⁶ in which “the sides . . . are not in symmetrical positions,” as the prosecution possesses more power.⁹⁷ Criminal cases usually involve juries that dilute the judge’s influence, whereas civil cases are usually wholly decided by the judge.⁹⁸ Even so, criminal defendants are insulated from the “depriv[ation] of life, liberty, or property, without due process of law” by the Bill of Rights in the Fifth Amendment of the U.S. Constitution.⁹⁹ Given what they have to lose as compared to civil litigants, it is critical to avoid infringement on their right to a fair trial.

If the motion is timely filed with acceptable form,¹⁰⁰ it will be granted, and the transition process is automatic in the sense that the affidavit is not contestable. The “judge immediately loses jurisdiction over the case,” and “any action that [they] make[] in the case [is] considered ‘void,’ ” save to transfer the case to another judge.¹⁰¹ A challenge is “exercised when the challenged judge transfers the case for reassignment,”¹⁰² and it cannot be rescinded, no matter what—the dismissal of the movant makes no difference.¹⁰³ If no other judge is available, the disqualified judge should contact the Chairman of the Judicial Council to solicit the assignment of an outside judge.¹⁰⁴ In order to prevent the appearance of judicial impropriety, if the judge is assigned to more than one case concerning the same movant, they are disqualified from all such cases.¹⁰⁵ A writ of mandate petition is the “exclusive means of appellate review” for the motion, irrespective of its success.¹⁰⁶ Upon a failed motion, the litigant has two avenues of redress before appeal: review by a different judge, like the district’s chief judge, and mandamus review.¹⁰⁷ On the other hand, litigants who never assert a challenge will have “forfeited the right to complain about [how the trial court’s alleged bias affected subsequent rulings] on appeal.”¹⁰⁸

2. Judicial Rules

Section 170.6 intersects with other bodies of judicial rules, complicating the tapestry of California peremptory disqualification law. Upholding impartiality in the courts permeates all the guidelines that judges should follow, regardless of origin—Standard 10.20(b)(3) of the California Rules of Court instructs judges to “ensure that all orders, rulings, and decisions are based on the sound exercise of judicial discretion and the balancing of competing rights and interests and are not influenced by stereotypes or biases.”¹⁰⁹ In light of this goal, the California Rules of Court encourage outreach to the community¹¹⁰ and collaboration with local committees and bar associations that endorse programs designed to educate about unconscious biases.¹¹¹ When litigants encounter judges who ignore Standard 10.20 of the California Rules of Court, they can submit complaints of bias either directly to the court or to the Commission on Judicial Performance without losing their statutory remedy through Section 170.6.¹¹² California Code of Judicial Ethics Canon 3D(4), Government Code section 68725, and Rule 104 of the Rules of the Commission on Judicial Performance obligates judges to cooperate with the Commission on Judicial Performance.¹¹³ In one instance, the Commission on Judicial Performance ordered the removal of a judge who communicated with the potential movant to stop their challenge.¹¹⁴

California Code of Judicial Ethics Canon 3B(5), Canon 3C(1), and Canon 3E(5)(f)(iii), among others, comport with the Model Code of Judicial Conduct rule 2.3¹¹⁵ because they advise that judges should be free of bias.¹¹⁶ Similar to the California Standards of Judicial Administration, California Code of Judicial Ethics Canon 3B(6) directs judges to “require lawyers in proceedings before [them] to refrain from . . . bias.”¹¹⁷ They consequently may feel cognitive dissonance (psychological discomfort from simultaneously complying with incongruous beliefs¹¹⁸) from essentially allowing litigants to discriminate against them using Section 170.6. Granted, these “standards, insofar as they may conflict with [S]ection 170.6, would be ‘invalid’ since the Judicial Council may only make rules which are not inconsistent with statute,”¹¹⁹ but this paradox may still trouble them. Furthermore, California Code of Judicial Ethics Canon 3D(1) instructs judges with reliable information on the violations of other judges to report those violations to the appropriate authority and take any other corrective actions.¹²⁰ Considering these numerous regulations that either officially or informally punish judges who harbor biases, whether explicit or not, are peremptory disqualifications truly necessary?¹²¹

3. Comparison to Peremptory Juror Challenges

In California, judicial peremptory challenges enjoy less resistance than in some other jurisdictions¹²² but are nonetheless more controversial than peremptory juror challenges. The California legislature passed AB 3070 in 2020—a proposal to require “the party exercising the peremptory challenge [to] show by clear and convincing evidence that an objectively reasonable person would view the rationale as unrelated to a prospective juror’s race, ethnicity, gender, gender identity, sexual orientation, national origin, or religious affiliation.”¹²³ The Legislature deliberately replaced the need to show purposeful discrimination under an objective standard in order to better target unconscious bias.¹²⁴ Unlike judicial peremptory disqualification, in which there is confusion regarding who holds the cause of action for discriminatory exclusion,¹²⁵ the bill clearly gives the right to both the party and the trial court. California Governor Gavin Newsom signed the legislation into law (California Code of Civil Procedure § 231.7), which went into effect for criminal trials on January 1, 2022 and will take effect for civil trials starting January 1, 2026.¹²⁶ The statute joined reforms in other states:¹²⁷ Washington enacted a similar procedure in 2018 that was praised as a solution to Batson v. Kentucky,¹²⁸ a landmark case prohibiting unconstitutional discrimination during jury selection.¹²⁹ After observing Batson’s shortcomings in actually resolving racial bias and discrimination,¹³⁰ supporters argue that the spirit and letter of this legislative decision carries the promise of giving life to the federal precedent.¹³¹

But this law is not without dissenters. The Alliance of California Judges rebukes it for creating “confusion and delay” since “lawyers could challenge every peremptory challenge made by the other side.”¹³² Ultimately, it falls short of putting an end to peremptory juror challenges altogether, making others think that the change is not enough: Senate Bill 212 was introduced in 2021, which would have abolished peremptory challenges in criminal cases.¹³³ One wonders at the end of the day if it is still accurate to classify this challenge as peremptory as “[a] challenge subject to questioning and explanation is, by definition, not peremptory.”¹³⁴ Whether judicial peremptory challenges can inherit this reform such that it is workable to judges poses an interesting question.

C. Comparison Between California Law and Other States’ Law

Section 170.6 is one of the two forms of judicial peremptory challenges practiced by twenty states. Judicial officers in thirteen states, like jurors, can be substituted upon request without any accusation of improper personal interest, while those in the remaining seven states can only be substituted upon an affidavit of bias.¹³⁵ Table 2 below describes some differences between Section 170.6 and peremptory challenge statutes in other states:

Table 2.
Parameters	Section 170.6	Statutes in Other States
Is there a fee for reassignment to a new judge?	No	Yes^a
How many challenges to a party per case?	One	Two^b
Does alignment of interest or lack thereof define a party (or side)?	Yes	No^c
Must litigants informally ask the judge to voluntarily recuse from the case before filing an affidavit?	No	Yes^d
Can criminal litigants transfer their case to a different judge?	Yes	No^e
Sources: ^aSee, e.g., Mont. Code Ann. § 3-1-804 (West 2023); Nev. Rev. Stat. Ann. § 1.230 (West 2023). ^bE.g., Or. Rev. Stat. § 14-250-70 (West 2023). ^cMo. R. Civ. Pro. § 51.05 “divides the parties into classes (e.g. plaintiffs, defendants, third party plaintiffs, third party defendants, interveners) and affords one change of judge per class” and Nev. Rev. Stat. Ann. § 1.230 treats “[e]ach action, whether single or consolidated . . . as having only two sides. Clingman, supra note 135, at 337–38. ^dS.D. Codified Laws § 15-12-22 (2023); see Clingman, supra note 135, at 338. ^eInd. Code Ann. § 35-36-5-1, Nev. Rev. Stat. Ann. § 1.230, Tex. Gov’t Code Ann. § 74.053, and Wyo. R. Civ. P. 40.1(b)(1) are some statutes that recognize this right in civil cases only. Clingman, supra note 135, at 338.

Although these states are not uniform in protocol, they all place weight on a movant’s good faith and decline to investigate whether the movant’s reasons, if even stated, are true, differentiating state law from federal law, which demands supporting facts.

II. THE POLICY TRADE-OFFS

A. Public Confidence in the Judiciary

Those who applaud the judicial peremptory challenge, a device that makes it easier to disqualify judges, emphasize its utility in maintaining and increasing public confidence that the judiciary will deliver equal justice under the law. Although “the law, not any individual or group, is a judge’s only legitimate constituent,” judges have free speech protections in judicial election campaigns.¹³⁶ If their views on controversial legal and political issues are broadcast through various media outlets, the public will naturally lose hope that due process¹³⁷ still exists in the courtroom. Since judges will likely reveal their biases, there are practitioners who advocate for appellate courts to adopt the peremptory strike system, as in California trial courts through Section 170.6, so the public can trust that their matters will be heard by a neutral arbitrator.¹³⁸ They echo Justice Kennedy’s advice for states to “adopt[] recusal standards more rigorous than due process requires” in an effort to protect judicial integrity.¹³⁹ Meanwhile, worried about the increasing caseload burdening the federal judiciary, some academics urge Congress to set up a commission responsible for establishing a judiciary reform act that would go into effect in 2030.¹⁴⁰ As the judiciary becomes more congested with inefficient case management and reduced dockets, judicial competence suffers, especially considering the “10% problem,” which is a “rough estimate of the percentage of district court judges who are considered unfit or limited in their capacity to dispense justice fairly.”¹⁴¹ These academics provide the 2030 Commission with a solution: peremptory challenges.¹⁴²

Curiously, the reason cited for condemning the challenge sounds familiar—increasing public confidence in the administration of justice. One legal scholar believes peremptory disqualification injures the judiciary’s reputation because “automatic transfer does not permit a judge to refute the allegations of bias, and so may create the public impression that more judges are biased, or have conflicts of interests, than is actually the case.”¹⁴³ Regrettably, judicial discretion, in which “the law gives the judge a range of options and choices, or relies on the judge’s assessment of the circumstances in drawing further conclusions,” exposes judges to criticism without crisis managers to guide them through this era of social media.¹⁴⁴ As committees and organizations dedicated to judicial independence face extinction, many stress the need for the legal profession to rally in defense of judges, perhaps by devoting resources to educating the public on what judges actually do.¹⁴⁵

B. Abuse of the Challenge

Peremptory challenges to judges can disrupt the harmony between not just a litigant and their judge, but also the litigant’s attorney and the judge, as well as the litigant and their attorney, essentially poisoning the most material relationships in the courtroom. First, the litigant must present the motion to the very judge they want disqualified.¹⁴⁶ Since the judge knows the movant’s identity, they may feel “frustrated at being required to grant relief to a party who had made what [they] consider to be an unwarranted slight to their integrity.”¹⁴⁷ If the motion is rejected, the litigant is stuck with the allegedly biased (and now insulted) judge until appeal because it is difficult to prevail on other review proceedings.¹⁴⁸ Second, although the attorney might wish to evade a particular judge for their entire legal career, a successful motion in one case does not insulate them from the judge’s hostility in future cases.¹⁴⁹ Third, caught in a web of ethical obligations, the attorney deals with an uncomfortable dilemma: Are they loyal to the judge or their client? No matter their self-interest to stay on good terms with the judge, they must reconcile their duty of vigorous advocacy on behalf of their client with their duty of honesty and respect to the court. They are probably tempted to use their affidavit power (that is, to capitalize on the boilerplate affidavit requesting only a conclusory accusation of bias) to win their client’s case, for they are given the benefit of the doubt.¹⁵⁰ However, their capability as “true advocates” is impeded by ethical rules that impose professional discipline should they lie about judges.¹⁵¹ They also cannot claim the full extent of free speech rights under the First Amendment, presumably fueling their apprehension at the growing number of sanctions in 2022.¹⁵²

Since the genesis of peremptory disqualification statutes, the risk of “judge shopping” has haunted legal scholars and practitioners alike. They argue that marginal improvements to judicial accountability do not warrant sacrificing judicial independence and integrity. When litigants judge shop under the guise of eliminating bias, they perpetuate the narrative that judges are simply “politicians in black robes” even though the Model Code of Judicial Conduct, court rules, judicial discipline sanctions,¹⁵³ and public opinion motivate judges to act properly. Admittedly, this illegitimate purpose is not allowed; the challenge, however, is an absolute right without regard for pretenses. For instance, according to one columnist, “[Section 170.6] could be warranted against the judge who tends to let all of [their] cases go to trial” if the attorney is “hoping to escape [the case] via summary judgment.”¹⁵⁴

To rebut these complaints of abuse, the challenge’s supporters point to the stringent rules governing the motion: specifically, its timing (framed as rushing litigants to “move[] as expeditiously as . . . is possible . . . after theretofore agreed on matter becomes litigated”¹⁵⁵) and form. These restrictions should discourage litigants from not only judge shopping, but also “from waiting to see how the judge views the case and rules on motions before making the peremptory challenge decision.”¹⁵⁶ Section 170.6, for example, is a “limited right and is not a vehicle for disqualifying judges in all situations in which there is a potential for bias.”¹⁵⁷ One law professor advances a limited conception of misuse such that litigants (1) can avoid extremist judges who are not necessarily biased but (2) cannot technically judge shop since a randomly assigned judge will preside over the previously assigned judge’s disqualification.¹⁵⁸ Peremptory disqualification increases the chance of the new judge sharing the same beliefs as most judges, which promotes a representative judiciary that reflects the citizenry because “an average judge may be more representative than a random one.”¹⁵⁹ This kind of judge shopping, as defined by the challenge’s opponents, is akin to “forum shopping,”¹⁶⁰ but the former is attacked as a radical threat to American ideals, while the latter enjoys more forgiveness from critics. The same can be said of “filing several cases simultaneously and dismissing all but the case before one’s preferred judge.”¹⁶¹ Besides statutory safeguards, like the very short window of opportunity to exercise a challenge, litigants might eschew the challenges—if their motion succeeds, they risk an even more unfavorable judicial draw, but if their motion fails, they risk a resentful judge.

C. Intimidation of Judges

There is also a strong assertion that judges will encounter intimidation, further cementing the deadlock between the two stances. A judge is more likely to be influenced by pressure from the litigant and their attorney when the defendant’s life, liberty, and property are hanging in the balance—in other words, criminal cases. Does the judicial peremptory challenge enable prosecutors to shop for “law and order” judges who are “tough on crime”?¹⁶² If a judge is peremptorily disqualified from every criminal matter to which they are assigned (colloquially known as “papering” or “blanket challenges”),¹⁶³ they risk not only a non-criminal reassignment that poses a “very serious problem for a judge whose entire legal career has been spent in the criminal justice system,”¹⁶⁴ but also transfer to a court that is, in their opinion, more inconvenient or less prestigious.¹⁶⁵ As judges try to appease prosecutors to avoid repeated disqualification, the pool of judges actually deciding criminal cases becomes undersaturated with lenient and liberal judges.¹⁶⁶ Prosecutorial control over judges (along with other challenges due to unusual judicial philosophies) results in a much smaller spectrum of worldviews among judges, hampering the development of legal interpretations and encumbering healthy debate.¹⁶⁷ Erwin Chemerinsky responds to the “unlimited use of peremptory challenges against a single judge, albeit in different cases,” by prescribing even greater procedural protections.¹⁶⁸ However, even if litigants manipulate this mechanism to pressure judges,¹⁶⁹ it is hard to imagine judges succumbing to partiality after only one or even a few cases. Perhaps district attorneys or public defenders who frequently appear in the same court can effectively intimidate judges,¹⁷⁰ but in the big picture, criminal cases make up a small subset of total filings.¹⁷¹

D. Discrimination Against Judges

Two law professors illustrate how judicial peremptory challenges can act as a vehicle for discrimination: one uses a hypothetical,¹⁷² while the other uses two cases in which attorneys were accused of discriminating against their judges.¹⁷³ There is a 1985 study suggesting that race-based abuse of the challenge was rare,¹⁷⁴ but the latter professor dismisses its applicability because there is now greater awareness about the unconstitutionality of racially charged decisions,¹⁷⁵ especially after Batson and J.E.B. v. Alabama ex rel. T.B.¹⁷⁶ With more judges who identify with marginalized groups, there are consequently more opportunities for challenges based on protected characteristics (leading to disproportionate disqualifications along racial lines, for example).¹⁷⁷ In California, where 63.1% of judges are white, a white judge will probably substitute a disqualified judge of color.¹⁷⁸ These removals are contrary to a socioeconomically representative judiciary—judicial officers from historically oppressed groups are more likely to have public-interest experience and less likely to have a upper-class background than their colleagues.¹⁷⁹ Additionally, empirical studies implying that age and gender are outcome determinative may tempt litigants into issuing ageist or sexist challenges.¹⁸⁰ Other studies have confirmed the discriminatory effects of peremptory juror challenges,¹⁸¹ substantiating arguments that the challenge is inherently flawed and does more discriminatory harm than any good.¹⁸² This could ring true for judicial peremptory challenges as well: What is stopping attorneys who discriminate against jurors from also discriminating against judges?

Then again, litigants are forbidden from exercising the challenges solely based on group affiliation like race and ethnicity, gender, sexual orientation, religion, and so forth.¹⁸³ They may not even want to rely on such factors—a judge’s “prior decisions made while on the bench, statements made in public forums, [and] professional and political reputations years deep”¹⁸⁴ better predict judicial propensity, after all. According to a member of the Alaska Judicial Council, the challenges in that state did not, in fact, depend on race or gender.¹⁸⁵ The problem, however, is not simply solved. Take California Code of Civil Procedure section 170.2, Section 170.6’s sister judicial disqualification statute, for example. It prohibits discrimination against judges, yet it does not seem to apply to Section 170.6.¹⁸⁶ Despite precedent that judges deserve shelter under the Equal Protection Clause of the Fourteenth Amendment,¹⁸⁷ “any party charging that [their] adversary has used a [S]ection 170.6 challenge in a manner violating equal protection bears the burden of proving purposeful discrimination,”¹⁸⁸ which is a high, if not unattainable, standard. Historical patterns of a movant’s discrimination could replace direct evidence of discriminatory intent, but there is a caveat: Is it possible to discern a pattern from a relatively small sample size?¹⁸⁹ Moreover, in the event the judge, as the right holder, declines to pursue their cause of action for discriminatory challenges, there is much uncertainty about whether litigants then have standing to object.¹⁹⁰

III. EMPIRICAL FINDINGS IN CALIFORNIA

A. Research Methodology

It appears that much of the policy debate about judicial peremptory disqualification is informed by theory rather than empirical data. Where are the surveys asking the public in states that allow the challenge about their confidence in the judiciary and perception of judicial bias? There is some research investigating how the challenges can intimidate judges (especially if initiated by prosecutors¹⁹¹) and discriminate against judges of a certain race or gender.¹⁹² Nonetheless, there remains a dearth of statistical findings regarding the frequency and type of abuses resulting from peremptory challenges in actual operation.¹⁹³ “[W]ithout [the collection of empirical data], predictions about what attorneys will do [or cause] with peremptory challenges are guesswork,” leaving the aforementioned hypotheses with no answers.¹⁹⁴ Therefore, this Note aims to paint a more complete picture by tackling two questions: (1) do strict procedural rules really act as a barrier to slow the number of disqualifications, so the number of disqualified judges is roughly equal to the number of judges disciplined for bias, and (2) are there discriminatory effects based on judges’ political parties that prevent a representative judiciary? It will do so by adhering to the recommendations to examine orders on peremptory challenges in cases.¹⁹⁵

Due to limited time and resources, only the available orders on LexisNexis (specifically, the 240 citing decisions of Section 170.6 after filtering for a timeline of January 1, 2021 to December 31, 2021) are analyzed. LexisNexis is a trustworthy source,¹⁹⁶ but checking other databases, such as Westlaw, would have ensured that this methodology did not overlook orders. This truncated sample is largely not generalizable to the years before or after 2021. California is also not a microcosm for the entire nation: when interpreting the number of disqualified judges who were registered Democrats versus the number of disqualified judges who were registered Republicans, one should remember that California is a “blue” state that is considered a Democratic stronghold. Further, this Note interprets suggestive trends, not causal relationships, from the data as no formal statistical methods are used. Lastly, given that the cases’ dockets, including other related orders, opinions, and filings are not reviewed, there is missing information for some orders (for instance, the disqualified judge’s identity, the order’s date, whether the order was accepted or denied, and the reason behind the decision), which could misrepresent the results. For decisions that anonymously mention both the disqualified judge and the supervising or presiding judge, and hence create confusion about the role of the decision’s author, the analysis below errs on the side of caution and excludes these orders when tracking disqualified judges. Ideally, the study would only include orders from 2021; for consistency, it includes orders both without a date and from before 2021 if the decision that discusses the order is from 2021.

B. Preliminary Empirical Data

There were 134 cases from January 8, 2021 to December 30, 2021 that revealed 158 ascertainable orders either accepting, denying, or discussing previously accepted or denied judicial peremptory challenges. For reference, there were 4,464,380 total filings in California superior courts in 2021.¹⁹⁷ Curiously, out of the 58 counties in California, only 11 (19%) had reported orders: Los Angeles (76 filed motions), Orange (41 filed motions), Sacramento (24 filed motions), San Diego (5 filed motions), Alameda (3 filed motions), Riverside (3 filed motions), Contra Costa (2 filed motions), Butte (1 filed motion), Madera (1 filed motion), San Francisco (1 filed motion), and Santa Clara (1 filed motion). Given that the study found 158 motions from just 134 cases and movants in only 11 out of 58 counties, this low occurrence of the challenges suggests that (1) litigants are generally not taking advantage of this litigation tool for improper purposes and (2) a majority of judges are perceived to be impartial. Since succeeding judges are randomly selected, there is a chance that litigants who detected bias in their judge would have issued a challenge if not for the fear that they might have to litigate under an even more biased judge. But, excluding pessimistic litigants who have little faith in judicial officers as a whole, it is unlikely that they will choose not to file a motion and endure a laborious litigation under a biased judge.

Among the 158 motions under Section 170.6, only 54 (34%) denied the challenge—Figure 1 displays the number of denials per specific reason:

Figure 1.

Section 170.6 is replete with rigorous procedural rules to make it harder for litigants to recklessly eliminate a qualified judge assigned to their matter. First, a little more than half of the denied motions (52%) failed to comply with Section 170.6(a)(2)’s timing standards.¹⁹⁸ Second, 4 challenges (7%) were defeated because they were addressed to an appellate judge and thus did not survive Section 170.6(a)(1).¹⁹⁹ Third, there was a three-way tie for reasons that blocked 3 motions (5.5%) each: submitting more than one challenge, in violation of Section 170.6(a)(4), whether it was from one party or one determined side;²⁰⁰ the continuation rule, codified by Section 170.6(a)(5); and the form standards, mandated by Section 170.6(a)(5) for written affidavits and Section 170.6(a)(6) for oral statements.²⁰¹ Fourth, 2 others (4%) were unsuccessful because the court had no authority.²⁰² Fifth, 1 (2%) was denied as the movant had not yet appeared in the action.²⁰³ There was also a strange motion that was declared a “sham” since the litigant who filed the challenge was not a real person—as a result, the judge denied the challenge as it was not “duly presented” in accordance with Section 170.6(a)(4).²⁰⁴ Regrettably, the reasons for 9 denials (17%) could not be gleaned from the publicly available case material.²⁰⁵

In line with the empirical finding that 66% of challenges were granted, attorneys, at least competent ones, are not only aware of the timing and form rules, but also successfully follow them. This comes as no surprise considering they are used to meeting the many deadlines that make up litigation. The odds of submitting a faulty challenge and consequently suffering under an offended judge are negligible—presumably, counsel would not carelessly file a motion that they know or should know is bound to fail. There are several safeguards that litigants must navigate, but untimeliness, the most frequent reason for rejected motions, was a weak barrier, stopping just 18% of the challenges. The statute counts on the time limit for filing the motion to prevent litigants from peremptorily disqualifying their judge based on how the judge has been ruling on the case. However, litigants or their attorneys may already know how the judge will view their case as soon as they receive the judicial assignment (or at least within the designated time frame) due to “random internet searches, anecdotal opinions from colleagues, or perhaps printed biographical material about the judge.”²⁰⁶ Hence, it looks like the limit on the number of challenges per case is the only statutory design that might effectively stall abuse, as litigants are reluctant to gamble that their new judge will not be worse.

The remaining 104 successful challenges (66%) disqualified at least 37 judges from 1 or more cases. Figure 2 below illustrates this proportion:

Figure 2.

Given there were 1,755 superior court judges in 2021,²⁰⁷ 2% of those judges (notwithstanding both the unnamed judges and judges who ruled prior to 2021) were peremptorily disqualified. According to the California Commission on Judicial Performance’s 2021 Annual Report, a judge was disciplined for bias on 8 occasions: 5 times for “bias or appearance of bias not directed toward a particular class (includes embroilment, prejudgment, favoritism)” and 3 times for “bias or appearance of bias toward a particular class.”²⁰⁸ For context, there were “1,868 judgeships within the commission’s jurisdiction” including the judicial positions at the supreme court, courts of appeal, and superior courts.²⁰⁹ Even if all 8 instances of bias were from different superior court judges, less than 1% (0.5%) of all superior court judges would have faced discipline.

According to this data, there were more disqualified judges (2%) than judges disciplined for bias (0.5%). Judicial accountability was promoted when the 0.5% of judges who deviated from ethical guidelines were disqualified; what about the remaining 1.5% of judges? Of course, these judges might have just luckily evaded discipline for their bias. Discipline, unlike peremptory challenges, requires an investigation, not solely a mere allegation.²¹⁰ That being said, if the litigants and their attorneys truly thought their judge was biased, they could have complained to the Commission on Judicial Performance (at least anonymously) in order to avoid facing the same judge again.²¹¹

A disqualified judge’s age, race, and gender, among other characteristics, were not easily identifiable. However, the judge’s political leanings (determined by which political party they were registered for) were discoverable for 21 out of the 37 disqualified judges. Thirteen judges (62%) were Democrats, 7 judges (33%) were Republicans, and 1 judge (5%) was a Libertarian. This Note is committed to preserving these judges’ anonymity as they may understandably want to keep their politics confidential. Unfortunately, the distribution of party affiliation in the state judiciary was not readily ascertainable, but the total voter registration by political party provided some context—in 2021, 46.5% of voters were Democrats, and 24% of voters were Republican.²¹² The comparison is illustrated by Figure 3 below:

Figure 3.

The law does not and cannot cover every kind of situation, so judicial discretion in the interpretation of the law maintains the legal system. Accordingly, judicial disqualification must take into account the diversity of experiences and legal philosophies that make up the bench. Each judge should have opportunities to arbitrate cases; otherwise, caselaw will cease to think outside the box. Yet, the data reveals that 62% of the disqualified judges were registered Democrats, and 33% of those judges were registered Republicans. Granted, without knowing how many California judges in sum have a Democratic-party affiliation, this is weak evidence for party-affiliation bias. But it is at least some insight that may suggest at best discriminatory effects and at worst purposeful discrimination against Democrat judges—for not only criminal, but also civil cases.²¹³ If judges from a particular political party are systematically taken off matters through peremptory challenges, the judiciary becomes less representative. Consider how there are “persuasive correlations between the political party of the appointing authority and the judge’s decisions on certain issues,” according to an academic study of judicial decision-making.²¹⁴ Other group affiliations are also implicated: Black, Hispanic, and Asian voters are typically more liberal than conservative.²¹⁵

Of 37 disqualified judges, 33 of them had reviews on The Robing Room—a forum “by attorneys for attorneys” in which “judges are judged.”²¹⁶ Fifteen judicial profiles had at least 1 comment from or before 2021 that mentioned a Section 170.6 motion—all but 1 recommended a peremptory challenge. Out of the 32 comments urging others to use Section 170.6 (many of which listed more than one reason), only 15 comments (47%) complained of the judge’s bias. While 3 comments (9%) gave no reason at all, the remaining 17 comments cited explanations that did not concern bias: 17 (53%) for incompetence, 9 (28%) for unpleasant temperament, 4 (12.5%) for unnecessary delay, and 4 (12.5%) for disliked persons working in the judge’s chambers. Out of respect for these judges, their identities will remain anonymous, especially since the information is not necessary to this Note’s analytical aims. Figure 4 below demonstrates this distribution of motives:

Figure 4.

Section 170.6 blatantly spells out the one acceptable rationale for challenging the judge—bias. When litigants abuse their affidavit power against unbiased judges (that is, “judge shopping,” although the term does not quite capture the concept), they are admitting their search for a judge who will favor their side. The sample of comments from The Robing Room implies that Section 170.6 is not an obscure and hidden procedure. Rather, attorneys understand that they can peremptorily disqualify their judge through Section 170.6. Fifty-three percent of these comments recommending a challenge did not complain that the judge was biased. Admittedly, it is uncertain whether the litigants who challenged their judge in this study held the same beliefs as these reviewers or were influenced by these reviews in making their challenge. Though the data does not definitively prove that reasons outside of bias motivated these challenges, it still exposes what some practitioners think these challenges should be used for. Incompetence, unpleasant temperament, unnecessary delay, and disliked persons working in the judge’s chambers are undoubtedly serious problems, but they are problems that nevertheless affect both the plaintiff and defendant—there is no favoritism and therefore no bias. The duty of vigorous advocacy on behalf of the client is not a free pass for attorneys to bend the law to their will.

Besides The Robing Room, there were other published sources documenting criticism of the disqualified judges: circulating petitions for removal, judicial corruption activism pages, and news articles about their behavior in their private or public lives. One news outlet asked a disqualified judge about her alleged bias toward women to which she responded that there is probably an equally strong sentiment that she is biased toward men. Notably, the Commission on Judicial Performance publicly admonished one of the disqualified judges for improper conduct extraneous to bias.

There is arguably universal consensus that public confidence in the judiciary is of the utmost importance—the public needs assurance that they can rely on the courts for remedies to their legal grievances. The uproar against judges on the Internet (that is, the petitions, activism pages, news reports, and so forth) feeds the public impression that judicial independence is forgotten and left behind on the courthouse’s steps. Even if a judge’s attitudes on contentious issues in the legal and political community escape the public eye, the seemingly innocuous knowledge of the judge’s political-party registration can speak volumes given modern political polarization.²¹⁷ Republican litigants confronting Democrat judges may believe the “politicians in black robes” will unequivocally rule left, and vice versa for Democrat litigants. The perception of bias in the courts is disconnected from whether bias is actually rampant among judges.

IV. ALTERNATIVES TO CALIFORNIA’S JUDICIAL PEREMPTORY CHALLENGE

A. Existing Alternative Procedures

Despite an overall low risk of abuse, since judicial peremptory challenges are seemingly infrequent, there is little need for the challenge at all, at least in its current form. The empirical findings cast alternative approaches in a new light. This Note focuses on three ideas for compromise: the panel-exclusion approach, the interlocutory appeal approach, and the independent judge approach.

1. The Panel-Exclusion Approach

The panel-exclusion approach advocates the adoption of a procedure similar to that used in arbitration.²¹⁸ Litigants would anonymously exclude judges who are randomly placed on the case’s panel.²¹⁹ Unlike the challenge as it currently stands, court administrators would provide litigants with a “compilation of numerous exclusion decisions,” including rates, prior to any challenge, so litigants can make informed decisions without relying solely on “mistakes in individual cases.”²²⁰ This is an especially fruitful modification considering the overwhelming amount of unsolicited opinions and false stories online. Judicial analytics not only puts judges on notice about their inappropriate behavior and thus provides opportunities to cure such behavior, but also wins trust from the public by prioritizing transparency and honesty.

2. The Interlocutory Appeal Approach

A retired Associate Justice of the Arkansas Supreme Court admires Tennessee’s civil procedure in which “[t]he judge refusing to recuse, following a motion to do so accompanied by an affidavit, must enter an order stating his or her reasons for not recusing and any other pertinent information from the record for an immediate, interlocutory appeal to the Tennessee Court of Appeals, where that court will expedite and conduct a de novo review.”²²¹ Through the appeal, parties who failed to disqualify their judge would not have to endure a lengthy trial with an offended judge. Therefore, the challenge’s opponents might appreciate this third type of recourse before appeal of the entire case (joining review by a different judge, like the district’s chief judge, and mandamus review). The retired Associate Justice praises its efficacy in guarding judicial integrity and due process and urges Arkansas, a state where judges have discretion to deny disqualification motions without stating reasons, to follow suit.²²² His argument has merit in other jurisdictions with automatic disqualification, such as California, because appellate review will presumably lead to fewer judicial removals and prevent the public from falsely believing that there are more biased judges than is actually the case. The remedy provides no relief to litigants and attorneys who fear the insulted judge’s retaliation, but it should curtail judge shopping, especially on discriminatory grounds like race or gender, and minimize the odds of judicial intimidation. There is instinctive apprehension about crowding the appellate dockets, including the Supreme Court, but the Tennessee Administrative Office of the Courts—finding only ten or less appeals per year in a span of three years—and a Tennessee Court of Appeals judge—a “self-described ‘fan of the rule’ ”—calm these concerns.²²³ However, litigants lacking sufficient resources may not appeal even if their judge’s personal views have irreparably infected the proceeding.²²⁴

3. The Independent Judge Approach

Although his analysis revolves around a federal recusal statute’s reform, one legal scholar contributes a slightly different antidote to this dialogue. Another disinterested trial judge (that is, not the affected judge with a personal stake in the challenge) should rule on the disqualification motion because even the best-intentioned judge might be oblivious to their own faults. He further diverges from the affidavit procedure by suggesting that “the challenged judge be encouraged to file evidence refuting facts asserted in the recusal motion, and perhaps also an explanation of why disqualification is not justified,” so there is an “adversarial presentation of the issue.”²²⁵ Judges may worry about offending their colleagues,²²⁶ but given dissenting opinions and reversals of lower courts’ judgments, they are likely already accustomed to internal disagreement and can consequently stomach any potential discomfort.²²⁷ Additionally, he contends that “the appearance of justice will be better served, even if the actual rate of recusal remains unchanged.”²²⁸

B. The Proposed Alternative Procedure

A more promising solution is a hybrid model between the panel-exclusion approach (specifically, the dissemination of judicial analytics) and the independent judge approach. After litigants receive the exclusion decisions and rates, they can file the motion with a different trial judge who will review both the motion and the challenged judge’s evidentiary explanation for factual and legal sufficiency. An interlocutory appeal is rendered unnecessary if an independent judge can accurately filter for allegations that actually deserve a judicial peremptory challenge. Admittedly, like federal law, this is not peremptory per se, but it will hopefully further reduce the number of “uninformed, misinformed, [and] delusional”²²⁹ litigants who exercise the challenge.

As judges lack crisis managers, it is imperative that resources are invested into educating the public on judicial duties and verified statistics on judicial bias. Unlike news outlets, petitions, social media posts, and activism pages probably do not check the accuracy of the information they release. With the help of Big Data²³⁰ and artificial intelligence, judicial analytics will become more accurate over time, which will better alert litigants about the judges who are actually biased than other unverified sources. By making such information accessible, perhaps litigants will place less weight on factors like the judge’s race and gender, for example. The Robing Room states that slanderous comments posted in bad faith are subject to removal;²³¹ realistically, it can hardly stop all “sour grapes” who harbor disdain toward their judge for merely siding with the opposing party after fairly applying the law to the facts. Consider how one of the disqualified judges in the study asserted that there are an equal number of people who think she is biased toward either women or men. There is a possibility that the other sources noted in the study, besides the public admonishment, are campaigns by losing litigants to unjustifiably vilify their judge.

It seems problematic to allow judges to entertain motions petitioning their own disqualification, and the public agrees.²³² An independent adjudicator should handle the challenge, so the challenged judge does not have to awkwardly decide their own neutrality. It is a win-win situation—if the reviewing judge finds the challenged judge corrupted with partiality, then the public will trust that the judiciary is void of collusion, but if the reviewing judge deems the challenged judge unbiased, then the public will have faith in the judiciary’s independence, and the judge will be guarded from discrimination. Some argue that the challenged judge is ideal because they are closest to the alleged facts;²³³ this is precisely the issue. That said, the reviewing judge may have a connection to the challenged judge—for example, a friendship—that skews their decision in favor of a denial. Perhaps the reviewing judge should show that there is no personal relationship to the challenged judge, but at some point, judges have to be trusted to rule fairly.

In lieu of an automatic transfer, judges can defend their fitness to serve and expose the litigants who use bias as a pretense for prohibited reasons, like discrimination based on party affiliation. It is easy for Section 170.6 to act as a Trojan horse carrying ulterior motives because automatic reassignment is swiftly delivered following a quick evaluation of procedural adequacy. If judges have no chance to prove the allegations of bias wrong, these litigants unwittingly trigger an endless feedback loop in which their baseless challenges inflate the number of “biased” judges which, in turn, instigates more challenges. The expectation is that fewer than 1.5% of judges will encounter peremptory disqualification, closing the disparity between the number of disqualified judges and the number of judges disciplined for bias. This will then demonstrate to the public that judges are not always predisposed to bias. To play devil’s advocate, the public may feel disheartened upon witnessing too many judges found guilty of bias, but the judiciary should commit to their integrity and weed out the “10% problem,”²³⁴ the estimate of incompetent judges. Judges inevitably do not command from Olympian heights; rather, they are subject to their beliefs and attitudes. It is difficult to procure solid evidence of judges’ unconscious biases,²³⁵ but litigants should still explain what manifestations, whether inside or outside the courtroom, caused them to suspect such biases.²³⁶ They should not have free reign to judge shop due to a random feeling, especially in the U.S. legal system that is rooted in proof. Judicial economy is indeed lost if an inquiry is made into the merits as well,²³⁷ but it is a wiser alternative than the current framework that passively allows litigants to chase unequal justice.

V. RECOMMENDATIONS FOR FUTURE RESEARCH

Regrettably, without formal statistical methods to control for irrelevant factors, this Note is unable to confirm a causal relationship between a judge’s peremptory disqualification and any complaints of bias on their Robing Room profile. For the same reason, it is unknown if failed judicial peremptory challenges affected case outcomes (comparing the case in which the challenge was initiated to any future cases with the disqualified judge—this would have informed the policy debate on whether disqualified judges are truly hostile). Therefore, the first recommendation for future research is setting up a more sophisticated study in order to discover results beyond mere correlations. Another recommendation is conducting surveys directed to (1) the public asking about their impression of judicial bias,²³⁸ (2) judges asking about their various group affiliations (especially characteristics that are not available through public materials such as race and ethnicity, gender, and age), and (3) attorneys asking what resources they have at their disposal when deciding whether they should use Section 170.6. Since judicial disciplinary proceedings for bias may miss judges with more subtle manifestations of bias, one suggestion is to conduct an experiment²³⁹ testing how widespread conscious and unconscious biases are among superior court judges in California. Ideally, this Note would analyze the relationship between the type of case (for example, personal injury) and judge shopping; unfortunately, there were not enough free and accessible documents online. For this pursuit, as a judge’s area of professional expertise is easy to find, future researchers should investigate whether movants of a specific type of case are strategically challenging judges with or without experience in that practice area. Lastly, the challenge’s prevalence is a regional phenomenon in the United States, so studies conducted in other states are recommended as well.

CONCLUSION

Notwithstanding limitations, the empirical data reported in this Note has value—it discovered that judicial peremptory challenges were quite rare and therefore abuse from these challenges was not out of hand. Among the few filed motions, most were automatically granted, indicating that the procedural protections were a flimsier shield than the statute had planned. Juxtaposing the higher percentage of disqualified judges with the lower percentage of judges reprimanded for bias implies that litigants are alleging bias as a mere formality. This is further corroborated by the finding that more than half of the comments on The Robing Room recommending others to challenge a certain judge did not mention bias.²⁴⁰ In regard to discrimination, it found significantly more Democrat judges disqualified than Republican judges. Without additional research, this Note can only surmise about possible fixes to prevent discrimination, like the standard for employment law in which the judge’s ability to perform their duties must relate to the reasons for exclusion.²⁴¹ Whether the challenge can inherit AB 3070 (the 2020 law that “requir[es] an attorney exercising peremptory strikes to show clear and convincing evidence [under an objective standard] that [their] action is unrelated to that juror’s membership in a protected group or class”²⁴²) such that it is workable to judges poses an interesting question. Altogether, this Note concludes that there is not a serious risk of abuse from the challenge but Section 170.6 is still not a satisfactory remedy by legislation—there is no need to settle for less when there is a better solution. As Justice Kennedy wrote, judicial disqualification standards should extend beyond the minimum requirement of due process; however, they should not stretch so thin when judicial integrity is not completely broken. The proposed alternative will heal the issues produced when the challenge is granted as a matter of right by implementing an audit into the accusation’s truth. In other words, as a middle ground in the policy dichotomy, it will perfect the peremptory challenge and diminish the risk of abuse even more than the current model.

97 S. Cal. L. Rev. 253

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Sarah Park*

* Executive Senior Editor, Southern California Law Review, Volume 97; J.D. Candidate 2024, University of Southern California Gould School of Law; B.A. Communication 2019, University of California, Santa Barbara. Thank you to Professor Jonathan Barnett and Professor Robin Craig for serving as my advisors. To my family and friends—law school, much less this Note, would not be possible without your continuous support. I would also like to express my gratitude to the dedicated members of the Southern California Law Review for their hard work.

“Shelby County” to Clean Air Act: Evaluating the Constitutionality of California’s Clean Air Act Waiver Under the Equal Sovereignty Principle

May 2024July 2024Justine Huang*

In August 2022, California promulgated the Advanced Clean Cars II regulation, banning all sales of new gasoline-powered cars in the state by 2035. Transportation is the largest source of air pollution in California, responsible for nearly 40% of greenhouse gas (“GHG”) emissions; thus, the regulation is a crucial step towards meeting the state’s carbon neutrality and climate goals. California has the unique authority to regulate motor vehicle emissions due to a waiver exemption in the Clean Air Act. Congress recognized California’s expertise and unique air pollution challenges early on by authorizing just two standards: the national and California standards. Over the last five decades, California has received over one hundred waivers for its motor vehicle emission standards. However, in May 2022, seventeen states challenged the constitutionality of the waiver provision in Ohio v. EPA (pending in the D.C. Circuit Court of Appeals as of the publication of this Note), alleging, inter alia, that it violates the equal sovereignty principle—the idea that states must have equal political authority—by allowing only California to set new vehicle emission standards. These states further argue that California cannot regulate GHGs because climate change is a global problem not unique to California. To date, no court has addressed the constitutionality of the Clean Air Act under the equal sovereignty principle. Thus, this Note takes the principle seriously and analyzes how courts historically have applied it. In 2013, the Supreme Court developed the equal sovereignty principle as a meaningful concept for the first (and last) time in Shelby County v. Holder to invalidate section 4 of the Voting Rights Act. This Note applies the test established in Shelby County to the Clean Air Act waiver at issue, arguing that the equal sovereignty principle does not apply to the Clean Air Act, and even if it were to apply, the Clean Air Act waiver provision remains constitutional because Congress’s reasons for granting California an exemption remain relevant. California’s pioneering role in early air pollution control, its large economy, and its characteristic geographic and climate conditions put the state in a unique position to protect public health by regulating automobile emissions, while the state faces increasingly formidable threats from climate change that have exacerbated the local air pollution problems that initially compelled its motor vehicle regulations. Thus, even as California’s motor vehicle regulations have shifted from reducing local smog to reducing GHG emissions, California’s current needs continue to justify its differential treatment—maintaining, and perhaps even strengthening, the Clean Air Act waiver’s relevance in the twenty-first century.

INTRODUCTION

In August 2022, the California Air Resources Board (“CARB”), California’s chief air pollution regulator, promulgated the Advanced Clean Cars II regulation, which bans the sale of new gasoline-powered cars in California by 2035.¹ Transportation is the largest source of air pollution in the state, responsible for nearly 40% of greenhouse gas (“GHG”) emissions, 80% of nitrogen oxide pollution, and 90% of diesel particulate matter pollution.² CARB estimates that the new rule will result in significant climate, economic, and public health benefits. By 2040, the regulation is projected to result in a 50% reduction in GHG emissions from cars, pickup trucks, and SUVs.³ Taking gas cars off the road would eliminate the equivalent of 395 million metric tons of carbon dioxide emissions, which is analogous to avoiding the combustion of 915 million barrels of petroleum or shutting down more than one hundred coal plants for a year.⁴ From 2026 to 2040, the decrease in pollution should lead to 1,290 fewer cardiopulmonary deaths, 460 fewer hospital admissions for cardiovascular or respiratory illness, and 650 fewer emergency room visits for asthma.⁵ Thus, the regulation is a crucial step towards meeting the state’s carbon neutrality and climate goals.⁶

The regulations that California enacts are hugely influential; thus, the implications of California’s ability to implement motor vehicle regulations are extensive. If California were a country, it would be the tenth largest auto market in the world.⁷ As of May 13, 2022, seventeen states and the District of Columbia have adopted California’s Low-Emission Vehicle (“LEV”) and Zero-Emission Vehicle (“ZEV”) regulations under section 177 of the Clean Air Act, which allows other states to adopt California’s approved standards instead of the federal standards.⁸ California alone makes up 11% of U.S. new light-duty vehicle sales, or 40.1% when combined with the states that have already adopted its rules.⁹ New York was the second state to ban sales of gas-powered cars by 2035 as part of its plan to increase EV adoption.¹⁰ In February 2021, New York passed a law requiring all new passenger cars and trucks sold in the state to produce zero emissions by 2035,¹¹ and in September 2022, after California finalized its own ban, New York followed California in requiring all new vehicles sold by 2035 to be zero-emissions, setting in motion the regulatory process to implement the law.¹² In August 2022, Massachusetts Governor Charlie Baker also signed climate change legislation to end new sales of gas-powered cars in the state by 2035.¹³

California has the unique ability to implement motor vehicle emissions regulations because of an exception in the Clean Air Act.¹⁴ While the Clean Air Act generally prohibits states from setting vehicle emission standards,¹⁵ it provides a waiver exemption under section 209(b)(1) that allows California to set more stringent vehicle emission standards than the federal government.¹⁶ Given California’s pioneering role in motor vehicle regulations and unique air pollution problems, Congress recognized California’s expertise early on in the history of federal air pollution regulation.¹⁷ However, in May 2022, seventeen Republican-led states filed a lawsuit, Ohio v. EPA, challenging California’s ability to set its own pollution rules and demanding that the U.S. Environmental Protection Agency (“EPA”) revoke the waiver.¹⁸ The petitioner states claimed that the waiver provision is unconstitutional because it violates the so-called equal sovereignty principle—the idea that states must have equal political authority—by only empowering California to set new vehicle emission standards.¹⁹ The petitioners additionally argued that Congress cannot allow California alone to regulate climate change, which is a global problem not unique to California.²⁰ Because California has shifted from regulations to reduce smog and local air pollution to GHG regulations to address global climate change, the petitioners essentially argued that circumstances have changed enough since Congress enacted the waiver provision in 1967 that California’s special treatment is no longer justified.²¹

This Note takes the equal sovereignty claim seriously and argues that the Clean Air Act waiver provision remains constitutional under the equal sovereignty principle. Part I provides relevant background on the waiver provision and history of California’s waiver requests. It then summarizes the equal sovereignty principle arguments made in the pending Ohio v. EPA lawsuit and provides relevant history on how courts have applied the principle leading up to Shelby County v. Holder,²² the first time the Supreme Court held a statute unconstitutional based on the equal sovereignty principle. Part II argues that the equal sovereignty principle does not apply to the Clean Air Act, but even if it were to apply, the test from Shelby County does not invalidate the Clean Air Act waiver provision. This Note concludes by offering final thoughts on the equal sovereignty claim and underscoring the implications of Ohio v. EPA in California’s ability to continue to lead the nation in addressing GHG emissions.

I. BACKGROUND

A. The Clean Air Act and EPA Waiver Provision

California’s ability to implement its own motor vehicle standards stems from the Clean Air Act. Congress passed the Clean Air Act in response to air pollution crises in the mid-20th century resulting from industrialization.²³ “Killer fog” events, where a deadly mix of pollution and fog covered cities in the United States and around the world, spurred federal regulation of air pollution.²⁴ In 1955, Congress enacted the Air Pollution Control Act, the first national air pollution legislation.²⁵ Continuing “killer fog” incidents in the United States then prompted Congress to pass the 1963 Clean Air Act, which established grant and research programs to support states in their air pollution control efforts but left air pollution regulation primarily to the states.²⁶

California was the first state to regulate emissions from cars.²⁷ The first recognized episodes of smog occurred in Los Angeles in 1943, and in the 1950s, a California researcher determined that the automobile was the main cause of the smog.²⁸ In 1966, California established the first tailpipe emissions standards in the nation.²⁹

Congress continued to enact new statutes in response to California’s regulations.³⁰ The 1967 Air Quality Act amended the 1963 Clean Air Act, moving towards a uniform federal policy by requiring national air quality criteria, which states would then implement.³¹ It was also the first statute to give preemptive power to the federal government to adopt and enforce standards relating to the control of emissions from new motor vehicles.³² However, Congress added a waiver provision exempting California from the preemption provision when California could demonstrate a need for more stringent standards than those the EPA established.³³ While the waiver does not reference California by name, it was clearly intended for California because California was the only state that met the requirement of adopting motor vehicle emission standards prior to March 30, 1966.³⁴ Thus, Congress acknowledged California’s expertise early on in the history of federal air pollution regulation.

In fact, the Clean Air Act is a paradigmatic example of cooperative federalism, under which “States and the Federal Government [are] partners in the struggle against air pollution.”³⁵ The federal preemption provision reflects Congress’s interest in allowing automobile manufacturers to produce uniform automobiles for a national market and benefit from the economies of large-scale production without having to accommodate multiple state standards.³⁶ Congress acknowledged the complex nature of automobile manufacturing and noted the importance of ensuring that automobile manufacturers obtain “clear and consistent answers” concerning emission standards.³⁷ Courts have also interpreted that Congress preempted the field of vehicle emission regulation “to ensure uniformity throughout the nation, and to avoid the undue burden on motor vehicle manufacturers which would result from different state standards.”³⁸ However, given California’s lead in early motor vehicle regulations and Congress’s additional interest in having California as a “laboratory for innovation,”³⁹ Congress intentionally struck a balance between having one national standard and fifty different state standards by authorizing just two standards, the national and California standards.⁴⁰ This balance allowed California to continue to innovate and improve its air quality without creating a practical nightmare for automakers and interstate commerce.⁴¹

The 1970 Clean Air Act Amendments, which form the basis of the contemporary federal Clean Air Act, authorized the development of federal and state regulations to limit emissions from stationary (industrial) and mobile sources (including automobiles).⁴² Section 109 requires the EPA Administrator to establish basic requirements for ambient air quality, known as National Ambient Air Quality Standards (“NAAQS”), for particular criteria pollutants, which the states would be required to meet.⁴³ The current list of criteria pollutants includes sulfur dioxide, particulate matter, nitrogen oxide, carbon monoxide, ozone, and lead, but does not include carbon dioxide.⁴⁴

In 1977, Congress revised the provision to read as it does today. Section 202(a)(1) requires the EPA Administrator to establish motor vehicle emissions standards for pollutants “which, in his judgment, cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare.”⁴⁵ The 1977 Clean Air Act Amendments strengthened the deference given to California under the waiver provision in two significant ways. First, the 1977 Amendments revised section 209(b)(1) by requiring the EPA Administrator to grant a preemption waiver for California “if the State determines that the State standards will be, in the aggregate, at least as protective of public health and welfare as applicable Federal standards.”⁴⁶ This amendment allows California, rather than the EPA, to make its own determination as to whether the regulations are sufficiently protective of public health and welfare. It also allows California to make this determination by looking at the entire program as a whole, rather than evaluating each regulation individually. Thus, as long as the entire set of regulations is more protective than the federal system, the EPA must allow California to implement these measures. The EPA Administrator can deny the waiver only if the state’s determination is “arbitrary and capricious” or the state does not need its standards to meet “compelling and extraordinary conditions.”⁴⁷ Second, the 1977 Amendments added section 177, which enhanced the strength of California’s motor vehicle emissions regulations by allowing other states to adopt California’s approved standards in lieu of the federal standards.⁴⁸ According to the House Report, the Committee on Interstate and Foreign Commerce makes clear that it sought to “ratify and strengthen the California waiver provision . . . to afford California the broadest possible discretion in selecting the best means to protect the health of its citizens and the public welfare.”⁴⁹ The legislative and statutory history thus suggests that Congress intended to give California broad discretion to regulate air pollutants in the way it deems most appropriate to protect public health and welfare.

B. History of California’s Motor Vehicle Regulations and Waiver Requests

The Clean Air Act section 209(b)(1) waiver reflects a five-decade history of allowing California to implement motor vehicle emissions standards that are more stringent than federal government standards.⁵⁰ California was granted its first waiver in 1968 and has since received over one hundred waivers for a range of new or amended motor vehicle and motor vehicle engine standards.⁵¹ Smog in Los Angeles initially spurred California to adopt statewide standards to regulate criteria pollutants,⁵² and CARB has consistently developed the first emission standards in the nation.⁵³

As California transitioned from regulating criteria pollutants to promulgating regulations that address GHG emissions, certain EPA administrations began to challenge its waiver requests, leading to the ping-ponging back and forth between administrations. In 2002, recognizing that global warming would impose “compelling and extraordinary impacts” on California, the state enacted Assembly Bill (AB) 1493, Chapter 200.⁵⁴ The bill acknowledged that motor vehicle emissions are a major source of the state’s GHG emissions and that reducing GHG emissions is critical to slowing down the effects of global warming and protecting public health and the environment.⁵⁵ The bill directed CARB to adopt regulations that achieve the “maximum feasible . . . reduction of greenhouse gas emissions” from passenger vehicles, beginning with the 2009 model year.⁵⁶ Thus, in 2004, CARB approved the first regulations in the nation that control GHG emissions from motor vehicles (Pavley regulations), which applied to new vehicles for the 2009–2016 model years.⁵⁷

In December 2005, CARB requested a waiver to allow California to enforce its new GHG emission standards.⁵⁸ The EPA delayed action pending the outcome of litigation regarding whether the EPA had authority to regulate GHG emissions under the Clean Air Act, as the Clean Air Act did not explicitly regulate GHG emissions at the time.⁵⁹ The Supreme Court addressed GHG emissions for the first time in Massachusetts v. EPA, holding in a 5-4 decision that carbon dioxide is considered an “air pollutant” that the EPA may regulate under section 202(a)(1) of the Clean Air Act.⁶⁰ Thus, the Court held that the EPA has the statutory authority to regulate GHG emissions from new motor vehicles and that Congress provided the EPA with the flexibility to address new air pollutant threats that the EPA determines endanger the public welfare.⁶¹

Despite the Supreme Court ruling, in March 2008, the Bush administration’s EPA denied the waiver for the Pavley regulations, which was the first time the EPA denied a waiver for California.⁶² In its decision, the EPA deviated from the traditional interpretation of the “compelling and extraordinary” waiver criteria⁶³ to narrowly interpret that Congress authorized the EPA to grant a waiver only when “California standards were necessary to address peculiar local air quality problems,” as opposed to global climate change problems.⁶⁴ Unlike California’s previous motor vehicle programs, which addressed local smog problems, the GHG emission standards aimed to address climate change. Thus, the EPA determined that California did not need its new motor vehicle standards to meet “compelling and extraordinary” conditions related to GHG emissions because emissions from California cars “become one part of the global pool of GHG emissions”⁶⁵ and do not directly cause elevated concentrations of GHGs in the region.⁶⁶ Alternatively, the EPA determined that because climate change is a global issue, the impacts of climate change in California were not sufficiently unique and different.⁶⁷

In July 2009, the Obama administration’s EPA reversed the 2008 denial and granted California’s waiver request to enforce its GHG emission standards for model year 2009 and later new motor vehicles.⁶⁸ As the EPA stated, CARB has repeatedly demonstrated the need for its motor vehicle program to address “compelling and extraordinary” conditions in California, and Congress did not intend to allow California to address only local or regional air pollution problems.⁶⁹ Rather, Congress intended California to have broad discretion and autonomy, acting as a pioneer and a “laboratory for innovation.”⁷⁰ Thus, narrowing the waiver’s scope would hinder California from implementing motor vehicle programs “as it deems appropriate to protect the health and welfare of its citizens.”⁷¹ In contrast to the 2008 EPA’s reasoning, the 2009 EPA determined that the impacts of global climate change can exacerbate the local air pollution problem.⁷² It found compelling California’s assessment that its GHG standards are linked to improving California’s smog problems and that higher temperatures from global warming will exacerbate California’s high ozone levels and the “climate, topography, and population factors conducive to smog formation in California, which were the driving forces behind Congress’s inclusion of the waiver provision in the Clean Air Act.”⁷³ The EPA noted that California’s GHG regulations will reduce greenhouse gas concentrations, even if only slightly, and “every small reduction is helpful . . . .”⁷⁴ Given California’s unique geographical and climatic conditions that foster extreme air quality issues, its ongoing need for dramatic emissions reductions, and growth in its vehicle population and use, the EPA determined that California’s need met “compelling and extraordinary” conditions.⁷⁵ Still, the EPA acknowledged that “conditions in California may one day improve such that it no longer has the need for a separate motor vehicle program.”⁷⁶

In 2012, CARB adopted the Advanced Clean Cars I (“ACC I”) regulations to increase the stringency of criteria pollutant and GHG emission standards for new passenger vehicles for the 2015–2025 model years.⁷⁷ In 2013, the Obama administration’s EPA granted California a waiver for its ACC I regulations.⁷⁸ The EPA largely followed the 2009 waiver decision in determining that the new standards continued to meet “compelling and extraordinary” conditions.⁷⁹ The EPA found a rational connection between CARB’s emission standards and long-term air quality goals,⁸⁰ as well as compelling and extraordinary conditions within the state pertaining to the effects of pollution.⁸¹

In September 2019, in an unprecedented move, the Trump administration’s EPA revoked the 2013 waiver, marking the first time the EPA retroactively withdrew a previously granted waiver.⁸² The EPA went a step further than its 2008 waiver decision, narrowly interpreting that “Congress did not intend the waiver provision . . . to be applied to California measures that address pollution problems of a national or global nature,” but only conditions “extraordinary” with respect to California; that is, “with a particularized nexus to emissions in California and to topographical or other features peculiar to California.”⁸³ The EPA argued that climate change caused by carbon dioxide emissions is not a local air pollution problem and that California’s new motor vehicle standards deviated too far from what Congress intended in granting California a waiver.⁸⁴ The EPA concluded that California’s GHG standards were missing a specific connection to local features, and thus excluded GHG regulation from the scope of the waiver.⁸⁵

In March 2022, the Biden administration’s EPA rescinded the 2019 waiver withdrawal, restoring the 2013 waiver and California’s authority to enforce its GHG emission standards and ZEV sales mandate.⁸⁶ In determining that California has a compelling need for its GHG standards and ZEV sales mandate, the EPA essentially reverted back to its 2013 analysis, maintaining that pollution continues to pose a distinct problem in California.⁸⁷ The EPA saw no reason to distinguish between local and global air pollutants, reasoning that all pollutants play a role in California’s local air quality problems and that the EPA should provide deference to California in its comprehensive policy choices for addressing them.⁸⁸ The 2022 EPA refuted the 2019 EPA’s premise that GHG emissions from motor vehicles in California do not pose a local air quality issue,⁸⁹ noting that criteria pollution and GHGs have interrelated and interconnected impacts on local air quality.⁹⁰

Congress recently expanded the Clean Air Act to include GHGs, clarifying that GHGs are pollutants under the Clean Air Act. On August 16, 2022, President Biden signed the Inflation Reduction Act into law, the single largest climate package in U.S. history, which will invest almost $370 billion in clean energy and other climate-related measures over the next ten years, and is expected to reduce U.S. carbon emissions by 40% by 2030 compared to 2005 levels.⁹¹ The Act reinforces the EPA’s authority to regulate GHGs under the Clean Air Act, amending sections of the Clean Air Act to define “greenhouse gas” to include “the air pollutants carbon dioxide, hydrofluorocarbons, methane, nitrous oxide, perfluorocarbons, and sulfur hexafluoride.”⁹² It also grants money under the Clean Air Act for any project that “reduces or avoids greenhouse gas emissions and other forms of air pollution.”⁹³ This language supports that Congress fully intends to include GHGs in the Clean Air Act and that California is acting within the scope of the Clean Air Act in implementing its forward-looking motor vehicle emissions regulations.

C. Pending Lawsuit—Ohio v. EPA

Similar to its prior motor vehicle regulations, California will need to request a preemption waiver from the EPA under section 209(b)(1) of the Clean Air Act to regulate post-2025 vehicles. In the meantime, the Biden administration’s EPA’s latest March 2022 waiver decision prompted Republican-led states and private petitioners to challenge the constitutionality of the Clean Air Act waiver provision, making the case highly relevant for California’s ability to regulate motor vehicle emissions in the future.⁹⁴ In May 2022, seventeen states filed a lawsuit in the U.S. Court of Appeals for the D.C. Circuit (Ohio v. EPA), claiming, inter alia, that the section 209(b)(1) waiver provision violates the equal sovereignty principle because it limits state political authority unequally by allowing only California to set new car emission standards and “exercise sovereign authority that section 209(a) takes from every other State.”⁹⁵ Under this principle, the petitioners alleged, Congress cannot give only some states favorable treatment of sovereignty authority, as it has done with California.⁹⁶ Even if section 209(b)(1) allowed California to regulate unique state-specific issues, the petitioners argued that the waiver would still be unconstitutional because it allows California to regulate GHGs to address climate change, which is not a problem unique to California.⁹⁷ The petitioners disagreed with the Biden administration’s EPA’s statement that “California is particularly impacted by climate change,”⁹⁸ arguing that other states will be impacted just as much, if not more, from climate change.⁹⁹

The petitioner states also took issue with the idea of giving one state power to regulate a major national industry.¹⁰⁰ The states argued that California’s “special treatment” under the Clean Air Act—giving California special power to regulate a major national industry and exercise sovereign authority that the Act withdraws from every other state, when California has no unique interest¹⁰¹—violates the Constitution’s intent to hold all states equal.¹⁰² In a separate brief, a group of private petitioners, including the American Fuel & Petrochemical Manufacturers and Clean Fuels Development Coalition, argued that the equal sovereignty principle does not allow the federal government to give only one state the authority to regulate national and international issues.¹⁰³ They claimed that any mandate to shift the nation’s automobile fleet to electric vehicles must come from Congress, because such a shift would “substantially restructure the American automobile market, petroleum industry, agricultural sectors, and the electric grid, at enormous cost and risk.”¹⁰⁴ The private petitioners cited the recent West Virginia v. EPA decision, which essentially restricted the EPA’s authority to regulate GHG emissions from power plants.¹⁰⁵ Applying the major questions doctrine,¹⁰⁶ the Court held that the EPA must point to “clear congressional authorization”¹⁰⁷ to justify its regulatory authority in “extraordinary cases” when the EPA asserts broad authority in an area of “economic and political significance.”¹⁰⁸ The Court concluded that the EPA does not have the authority to “substantially restructure the American energy market . . . .”¹⁰⁹ If the EPA cannot upend energy generation in the country, as West Virginia v. EPA held, then, the petitioners argued, California similarly cannot “upend the transportation and energy sectors.”¹¹⁰ The petitioners further argued that section 177 also allows California to shape national industries, which may burden the states that decline to adopt California’s standards.¹¹¹

On the other hand, several electric utility providers, clean energy industry groups, and auto manufacturers have backed California.¹¹² A few automakers have indicated that they support the more stringent California standards. In July 2019, CARB reached a voluntary agreement with four major automakers—BMW of North America, Ford, Honda, and Volkswagen Group of America—to adopt a modified version of the GHG standards.¹¹³ Building on this voluntary framework, in 2020, Volvo joined the four automakers in agreeing to a 17% emissions cut through the 2026 model year.¹¹⁴ The automakers filed a motion to intervene to defend the EPA’s March 2022 decision.¹¹⁵

To date, the Supreme Court has not addressed the constitutionality of the Clean Air Act under the equal sovereignty principle. In its 2019 decision revoking the 2013 California waiver, the Trump administration’s EPA interpreted the statutory criteria in the context of the equal sovereignty principle, explaining that section 209(b)(1) provides “extraordinary treatment” to California and therefore should be interpreted to require a “state-specific particularized” pollution problem.¹¹⁶ In contrast, in its 2022 waiver grant, the Biden administration’s EPA noted that it has historically declined to consider constitutional issues, reviewing the waiver solely based on the section 209(b)(1) criteria because the statute and legislative history reflect a broad policy of deference to California to address its air quality problems.¹¹⁷ Although equal sovereignty presented a new constitutional argument, the EPA limited its role in evaluating waiver requests to “the criteria that Congress directed EPA to review.”¹¹⁸ Nevertheless, the Biden administration’s EPA briefly addressed the equal sovereignty principle, arguing that the waiver does not impose a burden on any state and that Section 177, in enabling other states to adopt California’s standards, undermines the notion that the section 209(b)(1) waiver treats California in an extraordinary manner.¹¹⁹ Rather, in deliberately compromising between having one national standard and fifty different state standards by authorizing just two—the federal standard and California’s standards—Congress allowed California to be a “laboratory for innovation” and address the state’s extraordinary pollution problems, while ensuring that automakers were not overburdened with varying state standards.¹²⁰

D. California’s Advanced Clean Cars II Regulations

California recently promulgated the Advanced Clean Cars II (“ACC II”) regulations in the shadow of the pending Ohio v. EPA lawsuit. ACC II stems from an executive order Governor Gavin Newsom signed in September 2020 directing CARB to develop regulations contributing to the goal that 100% of in-state sales of new passenger cars and trucks will be zero-emission by 2035.¹²¹ As a result of the executive order, on August 25, 2022, CARB promulgated a new regulation, the ACC II program, phasing out all sales of new fossil fuel cars by 2035.¹²² The regulation requires that automakers increase the percentage of electric vehicles progressively, nearly tripling it to 35% by 2026 and reaching 100% by 2035 (see Figure 1).¹²³

Figure 1. Percentage of new vehicle sales that must be zero-emission vehicles

The ACC II regulations amend the ZEV and LEV standards for model years 2026–2035,¹²⁴ following the ACC I regulations, which address model year 2015–2025 vehicles.¹²⁵ CARB estimates that the new regulations will reduce vehicle GHG emissions by more than 50% by 2040.¹²⁶ Thus, the decision from Ohio v. EPA will have implications for California’s ability to implement standards including the ACC II program going forward.

E. The Equal Sovereignty Principle

The Supreme Court didn’t develop the equal sovereignty principle as a meaningful concept until Shelby County v. Holder in 2013,¹²⁷ in which the Supreme Court held a statute (the Voting Rights Act) unconstitutional based on the equal sovereignty principle for the first time. The Court did not clarify what constitutional provision this principle is based on.¹²⁸ Although the Constitution requires equal treatment among the states in particular contexts,¹²⁹ no provision explicitly requires Congress to treat all states equally as a general matter.¹³⁰ This absence of an explicit statement could mean that the founders did not intend to establish a generally applicable equal sovereignty principle.¹³¹ Critics of Shelby County have claimed that the Supreme Court invented the equal sovereignty principle to achieve political ends.¹³² Other scholars argue that questions about the sovereign power of the states have existed since the drafting of the U.S. Constitution.¹³³ Many scholars agree there is some support for the principle in the historical record and constitutional doctrine, but they doubt that is sufficient for it to be considered a “fundamental” principle, as Shelby County claims.¹³⁴ This Section traces the history of how courts have applied the equal sovereignty principle, from the context of admitting new states into the Union to voting rights.

1. Origins: The Equal Footing Doctrine—New Admission of States

The equal sovereignty principle dates back to the equal footing doctrine referenced in Article IV, Section 3 of the Constitution: “New States may be admitted by the Congress into this Union; but no new State shall be formed or erected within the Jurisdiction of any other State . . . without the Consent of the Legislatures of the States concerned as well as of the Congress.”¹³⁵ The Northwest Ordinance of 1787, which provided a path toward statehood for the territories northwest of the Ohio River,¹³⁶ further required that these states be admitted “on an equal footing with the original States in all respects whatever,” on the condition that the new state constitutions and governments were “republican, and in conformity to the principles contained in these articles . . . .”¹³⁷

Several court cases also interpret the Constitution to support the equal sovereignty principle. Pollard’s Lessee v. Hagan held that Congress must admit every state into the Union on the same terms and with the same powers as the original states.¹³⁸ Every state must be “admitted into the union on an equal footing with the original states,¹³⁹ with “equal sovereign rights.”¹⁴⁰ Further, the court held that “no compact” can “diminish or enlarge” the rights a state has when it enters the Union.¹⁴¹ Northwest Austin v. Holder referenced this case as support for the historic tradition that all states enjoy equal sovereignty.¹⁴² Coyle v. Smith held that states, not Congress, have sovereignty to choose where to locate their state capital: the United States “was and is a union of States, equal in power, dignity and authority, each competent to exert that residuum of sovereignty not delegated to the United States by the Constitution itself.”¹⁴³ No state is “less or greater . . . in dignity or power” than another.¹⁴⁴ Thus, Congress may not unequally limit or expand the states’ political and sovereign power.¹⁴⁵ Indeed, “the constitutional equality of the States is essential to the harmonious operation of the scheme upon which the Republic was organized.”¹⁴⁶ Thus, these cases establish the origins of the equal sovereignty principle in the admission of new states into the Union.

2. Equal Sovereignty Applied to Voting Rights

When the equal sovereignty principle was brought up in the context of the Voting Rights Act, courts had to determine whether the principle applied outside the state admission context.

Congress designed the Voting Rights Act of 1965 to address continuing voting discrimination after the Civil War.¹⁴⁷ The Fifteenth Amendment to the Constitution, ratified in 1870, prohibited voting discrimination based on race,¹⁴⁸ and Congress subsequently enacted the Enforcement Act of 1870, which prohibited obstruction of the exercise of the right to vote.¹⁴⁹ However, enforcement of the law was ineffective, and throughout Reconstruction, many southern states continued to enact tests designed to prevent Black people from voting.¹⁵⁰ To address this continuing discrimination, section 5 of the Voting Rights Act established a preclearance requirement, mandating that the federal government approve all new voting regulations to ensure that they did not perpetuate racial discrimination.¹⁵¹ However, the preclearance requirement only applied to states with a history of voting discrimination, as determined by the coverage formula in section 4 of the Voting Rights Act.¹⁵² The coverage formula implicated states located primarily in the South; thus, a select group of states were subject to more stringent requirements than other states when seeking to change their voting laws.

In its 1966 decision in South Carolina v. Katzenbach, the Supreme Court rejected the notion that the equal sovereignty principle prohibited differential treatment in the voting rights context. The Court held that the equal sovereignty principle only applied to situations involving the admission of new states, not the Voting Rights Act: “The doctrine of the equality of States . . . applies only to the terms upon which States are admitted to the Union, and not to the remedies for local evils which have subsequently appeared.”¹⁵³ The Court observed that Congress passed the Voting Rights Act in response to the “insidious and pervasive evil” of racial discrimination in voting,¹⁵⁴ and thus held that the Voting Rights Act was a constitutional and appropriate means for carrying out the Fifteenth Amendment.¹⁵⁵

Fourteen years later in City of Rome v. United States, the Supreme Court again upheld the Voting Rights Act as constitutional, finding that the Reconstruction Amendments were “specifically designed as an expansion of federal power and an intrusion on state sovereignty,” and thus, Congress had the authority to regulate state and local voting.¹⁵⁶ The Court cited Fitzpatrick v. Bitzer, which held that the principle of state sovereignty embodied by the Eleventh Amendment is “necessarily limited by the enforcement provisions of section 5 of the Fourteenth Amendment.”¹⁵⁷ However, the Court would later apply the equal sovereignty principle to invalidate part of the Voting Rights Act.

3. Shelby County v. Holder—Equal Sovereignty as a General Principle

Only two Supreme Court cases discuss equal sovereignty as a general principle.¹⁵⁸ Northwest Austin v. Holder,¹⁵⁹ though still a voting rights case, applied the equal sovereignty principle more broadly in 2009, laying the foundation for Shelby County v. Holder¹⁶⁰ to overrule Voting Rights Act section 4 in 2013.¹⁶¹

In Northwest Austin, the Supreme Court observed that the section 4 coverage formula of the Voting Rights Act went against the “historic tradition that all the States enjoy ‘equal sovereignty’ ” by differentiating between the states.¹⁶² The Court acknowledged that differentiating between states is sometimes justified, citing Katzenbach as an example.¹⁶³ However, it held that departing from “the fundamental principle of equal sovereignty requires a showing that a statute’s disparate geographic coverage is sufficiently related to the problem that it targets.”¹⁶⁴ Thus, the equal sovereignty principle limits Congress’s ability to subject different states to unequal burdens, at least without sufficient justification.¹⁶⁵ The Court also noted that the Act “imposes current burdens and must be justified by current needs.”¹⁶⁶ While the Court ultimately resolved the case on statutory grounds,¹⁶⁷ it expressed concern that sections 4 and 5 of the Voting Rights Act raised “serious constitutional questions.”¹⁶⁸ The Court observed that improved conditions in the South since 1965 may distinguish the case from Katzenbach because current conditions in 2009 may no longer reflect the discriminatory state actions that Congress meant for section 5 to address, and cited a lower racial gap in voter registration as an example to show that the coverage formula may rely on outdated statistics.¹⁶⁹ The Court also observed that the Voting Rights Act’s preclearance requirements “authorize[d] federal intrusion into sensitive areas of state and local policymaking” and imposed “substantial ‘federalism costs.’ ”¹⁷⁰

These concerns formed the basis for Shelby County to hold that section 4 of the Voting Rights Act was unconstitutional because it departed from the “fundamental principle” of equal sovereignty.¹⁷¹ The Supreme Court found the “fundamental principle of equal sovereignty” to be “highly pertinent in assessing subsequent disparate treatment of States.”¹⁷² The Court adopted the guidelines Northwest Austin set—namely, that the Voting Rights Act “imposes current burdens and must be justified by current needs,” and that “a departure from the fundamental principle of equal sovereignty requires a showing that a statute’s disparate geographic coverage is sufficiently related to the problem that it targets.”¹⁷³ The Court also distinguished the case from Katzenbach. Whereas in Katzenbach, the coverage formula was “relevant to the problem” of voting discrimination at the time,¹⁷⁴ here, the coverage formula was not updated to reflect contemporary improvements in voting participation, including higher voter registration and turnout numbers.¹⁷⁵ The Court concluded that Congress did not sufficiently justify its reauthorization of the “extraordinary and unprecedented features” of the Voting Rights Act;¹⁷⁶ thus, the Court held that the coverage formula no longer met the test introduced in Northwest Austin.¹⁷⁷

Shelby County, the only Supreme Court case to apply the test established in Northwest Austin, gave little guidance on how to apply the equal sovereignty principle in future cases, other than indicating that the law should rely on “current data reflecting current needs” when the degree of voting discrimination that prompted the original passage of the Voting Rights Act had changed.¹⁷⁸ The Supreme Court has not decided an equal sovereignty challenge since Shelby County, leaving lower courts to interpret how to apply the equal sovereignty principle outside the voting rights context.

II. APPLYING THE SHELBY COUNTY TEST TO THE CLEAN AIR ACT

Under the Northwest Austin test that Shelby County applied (the “Shelby County test”), the statute “must be justified by current needs,” and if federal legislation departs from the “fundamental principle of equal sovereignty,” it “requires a showing that a statute’s disparate geographic coverage is sufficiently related to the problem that it targets.”¹⁷⁹ This Part argues that the equal sovereignty principle likely does not apply to the Clean Air Act, thus the Shelby County test should not even apply. But even if it were to apply and the Shelby County test is triggered, this Part concludes that the principle does not invalidate section 209(b)(1) of the Clean Air Act because California’s current needs continue to justify its differential treatment. California’s unique exemption is sufficiently related to the public health problem that the Clean Air Act waiver provision targets; allowing California broad discretion to regulate motor vehicle emissions directly contributes to Congress’s goal of addressing public health threats from motor vehicle pollution in the state.

A. The Equal Sovereignty Principle Likely Does Not Apply to the Clean Air Act

This Section argues that the scope of the Shelby County test is limited and likely does not apply to the Clean Air Act. Shelby County emphasizes that the equal sovereignty principle applies to federal laws that “authorize[] federal intrusion into sensitive areas of state and local policymaking.”¹⁸⁰ The Supreme Court thus applied the equal sovereignty principle to the Voting Rights Act because it determined that election regulation was a sensitive area of state policymaking. Highlighting the “extraordinary” nature of the Voting Rights Act’s preclearance provisions,¹⁸¹ the Court noted that the law suspends “all changes to state election law—however innocuous—until they have been precleared by federal authorities . . . .”¹⁸² The federal government must explicitly grant states permission to implement voting laws that they “would otherwise have the right to enact and execute on their own . . . .”¹⁸³ Because the Voting Rights Act intruded into a sensitive area of state policymaking that had traditionally been the exclusive province of the states, the Court limited Congress’s authority under the Fifteenth Amendment to restrict states’ election procedures disparately.

Professor Leah Litman goes even farther to posit that only federal action that lessens the dignity of a state or group of states triggers the Shelby County conception of equal sovereignty.¹⁸⁴ Under this narrower interpretation, Litman argues that laws will violate equal sovereignty only if they single out particular states that have behaved in morally-blameworthy ways, limiting the scope of the principle to legislation enacted under the Reconstruction Amendments.¹⁸⁵ Under this interpretation, the equal sovereignty principle primarily serves as a check on the Fourteenth and Fifteenth Amendments and should only apply in cases similar to those involving voting rights, in which the dignity of human beings is at stake.¹⁸⁶

Since Shelby County, a few weak equal sovereignty claims have been made in the lower courts in areas outside of voting rights, and the courts have distinguished these cases from Shelby County. For example, in Mayhew v. Burwell, the U.S. Court of Appeals for the First Circuit held that the equal sovereignty principle does not apply to Medicaid laws.¹⁸⁷ Perhaps most relevant to the Clean Air Act waiver is National Collegiate Athletic Association (NCAA) v. Governor of New Jersey, which addressed the constitutionality of the Professional and Amateur Sports Protection Act of 1992 (“PASPA”).¹⁸⁸ PASPA prohibits states from licensing sports gambling, except for states that had gambling operations prior to the Act’s passage, which only includes Nevada.¹⁸⁹ The U.S. Court of Appeals for the Third Circuit determined that the equal sovereignty principle does not apply to PASPA, distinguishing the Voting Rights Act from PASPA by finding that regulating gambling via the Commerce Clause is “not of the same nature” as regulating elections via the Reconstruction Amendments.¹⁹⁰ The court held that the Commerce Clause allowed Congress to enact laws “aimed at matters of national concern and finding national solutions will necessarily affect states differently,”¹⁹¹ such that federal Commerce Clause regulation “does not require geographic uniformity.”¹⁹² The court found that applying Shelby County to all situations is “overly broad” and that the equal sovereignty principle does not apply outside “the context of ‘sensitive areas of state and local policymaking.’ ”¹⁹³

Similar to PASPA, Congress acted pursuant to its Commerce Clause authority in passing the Clean Air Act to regulate motor vehicle emissions; thus, Congress is exercising the federal power of regulating interstate commerce and can treat states differently in the process.¹⁹⁴ The Clean Air Act likely does not intrude into “sensitive areas of state and local policymaking” as the Voting Rights Act does. Regulating motor vehicles has not traditionally been the exclusive province of the states. Three agencies set federal and state vehicle emissions standards: the EPA, the National Highway Traffic Safety Administration, and CARB.¹⁹⁵ Section 209(a) of the Clean Air Act explicitly provides for federal preemption, prohibiting states from adopting their own motor vehicle regulations.¹⁹⁶ Regulating motor vehicle emissions affects interstate commerce because air pollution crosses state borders.¹⁹⁷ Thus, like PASPA, the Clean Air Act does not intrude into a sensitive area of policymaking traditionally occupied by the states.

At its core, the outcome the petitioners demand in Ohio v. EPA is inconsistent with the fundamental principle of equal sovereignty. Without the waiver, the Clean Air Act defaults to only federal standards and federal preemption, leaving states with no choice but to adopt the federal standard. Thus, invalidating the California waiver—as petitioners seek to do—gives states fewer choices. It fails to promote the principle of equal sovereignty, which arguably protects the power of the states to enact policies that differ from those of the federal government.¹⁹⁸ In her amicus brief, Professor Litman noted that the petitioners’ invocation of the equal sovereignty principle is inconsistent with its history because the petitioners’ arguments would result in less authority and flexibility for the states, and more coercive authority for the federal government.¹⁹⁹ By allowing California to promulgate more stringent standards and allowing other states to choose between the federal and California standards, Congress has offered those states more options, not fewer. This is likely not an abuse of state sovereignty.²⁰⁰ By arguing for an expansion of federal preemption, thereby preempting more state legislative and policy goals, the petitioners seek a result that does not promote state sovereignty and instead runs contrary to the equal sovereignty principle’s historical use as a limit on congressional power.²⁰¹

Congressional debates regarding California’s special status indicate that Congress clearly considered the equal sovereignty problem and rejected it. In 1970, members of the House of Representatives expressed concern that all states should have the “same right that the State of California has in setting standards that they deem necessary for the health and safety of their people.”²⁰² Representatives of other states, including Pennsylvania and New York, argued that their air quality problems were worse than California’s, so they too should have the power to create state regulations exceeding federal standards.²⁰³ Thus, proper application of the equal sovereignty principle would allow all states to promulgate their own motor vehicles emissions regulations. Congress was more concerned about other states not being able to promulgate their own motor vehicles emissions standards than about California having special privileges. In contrast, in Ohio v. EPA, the petitioner states attempt to prevent California from enacting more stringent policies that could benefit other states, thus flipping the use of the equal sovereignty principle to make it more difficult for states to enact their own policies.

The Supreme Court has suggested in Shelby County that the equal sovereignty principle does not extend to all areas of the law, and this Section concludes that the equal sovereignty principle does not apply to the Clean Air Act. However, even if it were to apply, the Clean Air Act waiver provision passes the Shelby County test and remains constitutional, as analyzed in the next Section.

B. Even if the Equal Sovereignty Principle Applies to the Clean Air Act, It Does Not Invalidate Section 209(b)(1) of the Clean Air Act

Even if the equal sovereignty principle were to apply to the Clean Air Act, the Clean Air Act waiver provision remains constitutional. Applying the Shelby County test, the Clean Air Act waiver likely departs from the “fundamental principle of equal sovereignty” in creating a differential in its treatment of states’ political authority. As a result, the “statute’s disparate geographic coverage” must be “sufficiently related to the problem that it targets.” This Section concludes that this criterion is met; thus, the waiver provision remains constitutional. Congress had strong justifications for granting California an exemption that continue to remain relevant. First, the Clean Air Act targets not only smog in one region of California, but also the broader problem of public health from automobile emissions. Second, allowing California to implement more stringent motor vehicle regulations would directly help address this broader problem. California faces new and increasingly formidable threats from climate change, which have exacerbated the existing problems that initially compelled California’s motor vehicle regulations. Allowing California broad discretion to regulate GHG emissions is directly related to Congress’s goal of addressing the public health threats from motor vehicle pollution in California because the effects of GHG emissions and smog are interrelated and affect one another. This Section thus concludes that California’s current needs continue to justify Congress’s differential treatment of California—maintaining, and perhaps even strengthening, section 209(b)’s relevance in the twenty-first century.

1. By Treating States’ Political Authority Differently, the Clean Air Act Waiver Likely Violates the Equal Sovereignty Principle

The equal sovereignty principle does not require the federal government to treat states equally in every scenario, but requires that all states have equal political authority.²⁰⁴ Black’s Law Dictionary defines “sovereignty” as “[s]upreme dominion, authority, or rule”²⁰⁵ and “state sovereignty” as “[t]he right of a state to self-government; the supreme authority exercised by each state.”²⁰⁶ The Court in Shelby County explained that “[s]tates retain broad autonomy . . . in structuring their governments and pursuing legislative objectives,”²⁰⁷ referencing the Tenth Amendment and federalism principles as crucial in preserving the “integrity, dignity, and residual sovereignty of the States.”²⁰⁸ In United States v. Texas, the Supreme Court noted that the equal footing doctrine applies to political rights and sovereignty, but not economic issues.²⁰⁹ The Court observed that the equal footing doctrine was not designed to eliminate diversity in economic aspects such as area, location, and geology, but rather to “create parity as respects political standing and sovereignty.”²¹⁰ Thus, Congress violates the equal sovereignty principle when it limits the political power of a particular subset of states.²¹¹

Legislation that prohibits some states but not others from enacting laws about the same topic likely would violate the equal sovereignty principle. For example, the Voting Rights Act limits only southern states’ ability to regulate elections and PASPA permits only Nevada to legalize sports betting;²¹² thus, these laws would in theory violate the principle. Similarly, the Clean Air Act treats California’s sovereign authority differently from the other states. By permitting only California to regulate motor vehicles and promulgate new motor vehicles emissions standards, while limiting other states to either adopt the California or federal standards, the Clean Air Act waiver arguably limits other states’ rights to govern themselves in the area of motor vehicles, as well as transportation and energy more broadly. Rather than allow all states with certain air quality conditions to set regulations, the Clean Air Act allowed the state that first adopted its own motor vehicle regulations to continue setting the standard for new regulations.²¹³ Thus, if we were to apply the equal sovereignty principle to the Clean Air Act, the Clean Air Act likely departs from the equal sovereignty principle by exhibiting disparate treatment of the states’ political authority pertaining to motor vehicle regulations.

2. Nevertheless, the Clean Air Act Waiver Provision Remains Constitutional Because Its Disparate Geographic Coverage Favoring California Is “Sufficiently Related to the Problem that It Targets”

Violating the equal sovereignty principle does not automatically invalidate a law as unconstitutional. However, it triggers heighted scrutiny, meaning that Congress must justify the disparate treatment of the states as unequal sovereigns²¹⁴ by showing that the differential treatment is sufficiently related to the problem the law is addressing.²¹⁵ This higher standard “ensures that when Congress limits the sovereign power of some of the states in ways that do not apply to others, it has a good reason to do so.”²¹⁶

In Shelby County, the Supreme Court concluded that the coverage formula, while perhaps justified in 1965, was no longer justified in 2006 when Congress reauthorized the Voting Rights Act.²¹⁷ Because the coverage formula continued to distinguish states “based on ‘decades-old data and eradicated practices,’ ” including the past use of literacy tests that “have been banned nationwide for over 40 years” and on racial disparity in “voter registration and turnout in the 1960s and early 1970s” that no longer persisted, the Court held that the 2006 reauthorization statute’s disparate geographic coverage was not sufficiently related to the problem of twenty-first century racial discrimination in voting that it targeted, so “current needs” no longer justified it.²¹⁸ Thus, the Court found circumstances in 2013 to be sufficiently changed to render the coverage formula unconstitutional.²¹⁹

Applying this line of reasoning to the Clean Air Act, the petitioners in Ohio v. EPA claim that because California has transitioned to regulating GHG emissions, the waiver provision is no longer sufficiently related to the problem that it targets because California’s standards are targeting climate change, which is global, not state-specific, in nature: “[C]limate change is not an acute California problem.”²²⁰ This Section counteracts this argument and asserts that the waiver provision continues to be sufficiently related to the problem that it targets, distinguishing California’s motor vehicle regulations from the voting regulations at issue in Shelby County. First, the Clean Air Act targets not only smog in one region of California, but also the broader problem of public health from automobile emissions. Second, allowing California to implement more stringent motor vehicle regulations would directly help address this broader problem. California faces new and increasingly formidable threats from climate change that have exacerbated the existing problems that initially compelled California’s motor vehicle regulations. The effects of GHG and smog pollution are directly interrelated and affect one another; thus, addressing GHG emissions is directly related to Congress’s goal of addressing the public health threats from motor vehicle pollution in California. This Section therefore concludes that California’s current needs continue to justify the state’s differential treatment.

i. The Clean Air Act Targets the Broad Problem of Public Health Threats from Automobile Emissions

How courts frame the problem that Congress is targeting can shape their determination of whether a statute is constitutional. In NCAA v. Governor of New Jersey, the U.S. Court of Appeals for the Third Circuit held that even if the equal sovereignty principle were to apply to Commerce Clause legislation, PASPA passed the Shelby County test because its “true purpose” was to “stop the spread of state-sanctioned sports gambling,” rather than eliminate it altogether.²²¹ Because PASPA was drafted in neutral terms, any state that already supported gambling could continue to do so, and Congress likely knew that Nevada was the only state that had existing gambling operations.²²² PASPA’s disparate geographic coverage was therefore justified: “Targeting only states where the practice did not exist is . . . precisely tailored to address the problem.”²²³ If the court had defined the problem PASPA was targeting as eliminating all sports gambling, Nevada’s exemption would be harder to justify, and the statute would likely be unconstitutional for not being sufficiently related to the problem. However, because the court defined the problem as halting the spread of sports gambling, the Third Circuit’s analysis was a stronger one.

In Ohio v. EPA, the petitioners argue that the problem Congress designed the Clean Air Act to target was a narrow, California-specific problem.²²⁴ However, while smog may have been the impetus for the legislation,²²⁵ Congress also intended a broader goal of enabling California to use its developing expertise in vehicle pollution to develop innovative regulatory programs and serve as a leader in automobile emissions regulations.²²⁶ In 1967, Congress acknowledged California’s serious air quality problems as well as its role as a laboratory for emissions control technology for the country.²²⁷ The Senate Report concluded that with California’s experience in control systems and design, the waiver provision will allow California to “continue to be the testing area” for more stringent standards, potentially strengthening federal standards and benefiting all states.²²⁸

Multiple instances from the Congressional Record suggest that the broader problem Congress intended to target was the public health threats caused by motor vehicle pollution.²²⁹ Congress could have amended the Clean Air Act in 1977 to restrict the waiver provision. Instead, it ratified and strengthened the waiver by giving California the flexibility to adopt a complete program of motor vehicle emission controls.²³⁰ The original 1967 waiver provision required the EPA Administrator to grant a waiver “unless he finds that such State does not require standards more stringent than applicable Federal standards . . . .”²³¹ In contrast, the amended version requires that the EPA grant the waiver “if the State determines that the State standards will be, in the aggregate, at least as protective of public health and welfare as applicable Federal standards.”²³² Congress intentionally granted California deference in creating motor vehicle standards in order to “afford California the broadest possible discretion in selecting the best means to protect the health of its citizens and the public welfare.”²³³ The amendment “confers broad discretion” on California to “weigh the degree of health hazards from various pollutants and the degree of emission reduction achievable for various pollutants with various emission control technologies and standards.”²³⁴ Congress made clear that the EPA should defer to California’s policy decisions, unless they are overwhelmingly arbitrary and capricious: the EPA Administrator “is not to overturn California’s judgment lightly. Nor is he to substitute his judgment for that of the State. There must be clear and compelling evidence that the State acted unreasonably in evaluating the relative risks of various pollutants . . . .”²³⁵ The EPA recognized in its 2013 waiver decision that Congress allowed it only limited review based on the section 209(b)(1) criteria to “ensure that the federal government did not second-guess state policy choices.”²³⁶ As the EPA affirmed, “Congress recognized that California could serve as a pioneer and a laboratory for the nation in setting new motor vehicle emission standards.”²³⁷ Thus, as long as the regulations protect the health of California residents, the EPA should defer to California on the scope of those regulations.

ii. Allowing California Broad Discretion to Regulate GHG Emissions Is Sufficiently Related to Addressing the Public Health Threats from Motor Vehicle Pollution in California

In Shelby County, the Voting Rights Act coverage formula factored in states’ voting discrimination history, which consisted of specific, unchangeable factors.²³⁸ In contrast, Congress noted that California’s circumstances can change: if California no longer faces “compelling and extraordinary” conditions, it can no longer establish its own standards.²³⁹ This possibility creates a built-in mechanism to continually evaluate whether California needs its separate regulations²⁴⁰ and whether the waiver provision is “justified by current needs.”²⁴¹ Recognizing “the unique problems facing California as a result of its climate and topography,” Congress noted in 1967 that only California has demonstrated “compelling and extraordinary circumstances sufficiently different from the Nation as a whole to justify standards on automobile emissions which may, from time to time, need [to] be more stringent than national standards.”²⁴² The petitioners in Ohio v. EPA treat GHG emissions as if they are a separate and mutually exclusive concept from smog and criteria pollutants, claiming that because California has shifted from regulations to reduce local smog problems to regulations to reduce GHGs and address global climate change, the waiver provision no longer justifies California’s exemption.²⁴³ On the contrary, this Section argues that the effects of GHG emissions and smog pollution are interrelated and affect one another. Thus, addressing GHG emissions is directly related to Congress’s goal of addressing the public health threats from motor vehicle pollution in California.

Given the history of California’s early motor vehicle regulations and Congress’s interest in having California as a “laboratory for innovation” while not overburdening automobile manufacturers by forcing them to comply with multiple state standards, Congress intentionally struck a balance by authorizing just two standards: the national standard and the California standard.²⁴⁴ This compromise would allow California to continue to innovate and improve its air quality without creating a practical nightmare for automakers and interstate commerce.²⁴⁵ Congress deliberately exempted California from federal preemption of motor vehicle regulations because of its “pioneering role in regulating automobile-related emissions, which pre-dated the Federal effort.”²⁴⁶ Because California had already adopted a robust air quality program and established its own motor vehicle emission standards prior to the passage of the federal Clean Air Act, it had expertise in emissions regulations that other states did not have.²⁴⁷

California’s large automobile market and economy continue to justify its disparate treatment. At the time Congress passed the Clean Air Act waiver, it recognized the “presence and growth of California’s vehicle population, whose emissions were thought to be responsible for ninety percent of the air pollution in certain parts of California.”²⁴⁸ Congress noted the large effect of vehicles on local air pollution: “Motor vehicles are responsible for about 90 percent of the smog in the Los Angeles County, some 56 percent in the San Francisco Bay area, and about 50 percent in San Diego.”²⁴⁹ Congress also noted that because of its large size, California has “an economy large enough to support separate standards.”²⁵⁰ Thus, California’s market was large enough that automobile companies could still make a sizable profit while producing cars to meet California’s more stringent environmental requirements.²⁵¹ There were twice as many vehicles in California as in any other state, including New York.²⁵² Today, California continues to be the largest automobile market in the United States; if the state were a country, it would be the tenth largest auto market in the world.²⁵³ California makes up 11% of U.S. new light-duty vehicle sales, and combined with the states that have already adopted its LEV rules, makes up 40.1% of U.S. new light-duty vehicle sales.²⁵⁴ Forty-three percent of ZEVs sold in the U.S. are sold in California.²⁵⁵

California’s unique topography and climate conditions have also contributed to the air pollution problems exacerbated by climate change. The legislative history indicates that Congress granted California an exemption to regulate motor vehicle emissions primarily because California was facing unique, severe air pollution problems across the state, particularly in the Los Angeles area.²⁵⁶ California’s air pollution problem was among “the most pervasive and acute in the Nation” at the time.²⁵⁷ Geographical and climatic factors were consistently cited as “compelling and extraordinary” factors during the House debate, including the “unique problems facing California as the result of numerous thermal inversions that occur within that State because of its geography and prevailing winds pattern.”²⁵⁸ Rep. Holifield noted that California has a unique problem due to an atmospheric inversion which “the peculiar topography of the metropolitan area of Los Angeles County” has caused to some extent by keeping smog in the area and surrounding counties.²⁵⁹ Even though members of Congress recognized that air pollution also affects other states in concerning ways,²⁶⁰ they agreed that California’s distinct conditions and topography continue to contribute to the unique effects of pollution in the state, creating a critical need for air pollution control.²⁶¹ As CARB established, California’s ozone levels will be exacerbated by higher temperatures from global warming, and “there is general consensus that temperature increases from climate change will exacerbate the historic climate, topography, and population factors conducive to smog formation in California, which were the driving forces behind Congress’s inclusion of the waiver provision.”²⁶²

Most significantly, climate change has only exacerbated the air pollution and smog problems that initially compelled California’s motor vehicle regulations and the Clean Air Act waiver. Automobiles emit both GHGs and smog-forming emissions including nitrogen oxide, carbon monoxide, and particulate matter.²⁶³ The 2021 report of the United Nations’ Intergovernmental Panel on Climate Change (“IPCC”) reflects the latest scientific consensus that climate change is both a local and global problem.²⁶⁴ The report establishes a connection between climate change and intensifying weather extremes including heat waves and droughts.²⁶⁵ Additionally, GHGs contribute to respiratory disease from smog and air pollution.²⁶⁶ GHG emissions lead to hotter global temperatures,²⁶⁷ which is expected to enhance the formation of ground-level ozone (a main component of smog).²⁶⁸ Exposure to ozone can cause respiratory problems²⁶⁹ and aggravate lung diseases including asthma, particularly within more vulnerable groups.²⁷⁰ Thus, GHGs can worsen exposure to ground-level ozone and smog, which is associated with increased mortality from respiratory and cardiovascular diseases.²⁷¹ As a result, it has been well established that GHGs and smog are interrelated and affect air quality separately and together.²⁷²

Contrary to what the petitioners claim, climate change continues to uniquely affect California as an “acute California problem.”²⁷³ While GHG emissions from California cars can “become one part of the global pool of GHG emissions,”²⁷⁴ this global pool eventually affects local conditions. The EPA recognized CARB’s strong evidence that California is “particularly impacted by climate change, including increasing risks from record-setting fires, heat waves, storm surges, sea-level rise, water supply shortages and extreme heat,” and that “GHG emissions contribute to local air pollution.”²⁷⁵ Climate change impacts ozone exacerbation and wildfires, which affect local air quality.²⁷⁶ California continues to have a serious smog problem, exacerbated by climate change.²⁷⁷ Seven of the ten cities with the worst air pollution nationwide are in California.²⁷⁸ Ten million Californians in the San Joaquin Valley and Los Angeles air basins currently live under “severe non-attainment” conditions for ozone, where people suffer unusually high rates of asthma and cardiopulmonary disease.²⁷⁹ Climate change has increased the number of hot days that can result in smog events and exacerbate wildfires.²⁸⁰ Thus, smog exacerbates climate change, which in turn exacerbates smog, and GHGs—which lead to climate change—continue to pose a direct and local threat.²⁸¹ As the 2022 EPA decision concluded, the 2019 EPA decision to withdraw the 2013 EPA waiver grant failed to properly consider “the nature and magnitude of California’s serious air quality problems, including the interrelationship between criteria and GHG pollution.”²⁸² The EPA noted that the 2019 record contained evidence that GHG emissions can lead to locally elevated carbon dioxide concentrations with local impacts such as ocean acidification, in addition to the longer-term global impacts from global emissions.²⁸³ Thus, just like smog, climate change poses serious threats to the public health and safety of residents in California. As a result, ZEV regulations are crucial in protecting the public health and safety of Californians.

Even adopting the 2019 EPA’s narrow “local nexus” test, which required that the California waiver only applies to measures that address conditions “extraordinary” with respect to California, or those with a specific connection to local features and emissions peculiar to California,²⁸⁴ California’s ZEV standard meets this test in directly addressing local air pollutant conditions by reducing criteria pollutant emissions. California’s 2020 Executive Order and resulting ACC II regulations made clear that California intended to regulate both GHG emissions and smog pollutants. The 2020 Executive Order states that zero emissions technologies “reduce both greenhouse gas emissions and toxic air pollutants,”²⁸⁵ and the ACC II regulations require new vehicles to “produce zero exhaust emissions of any criteria pollutant (or precursor pollutant) or greenhouse gas . . . .”²⁸⁶ California’s more stringent standards will thus continue to achieve critical reductions in conventional criteria pollution and help the state address public health problems caused by smog and soot.²⁸⁷ Congress has not provided any indication that California cannot take measures to reduce criteria pollutants and GHGs. Transportation is the largest source of air pollution in the state, responsible for nearly 40% of GHG emissions, 80% of nitrogen oxide pollution, and 90% of diesel particulate matter pollution.²⁸⁸ The EPA concluded that GHG measures are relevant to addressing local criteria pollutant issues²⁸⁹ and that regulations to reduce GHGs often simultaneously address smog-forming pollutants like nitrogen oxide.²⁹⁰ The legislative history provides no basis for the claim that California cannot mitigate climate change threats or address environmental problems within their boundaries as soon as the problems extend beyond them.²⁹¹ In fact, Congress expressed an interest in allowing California to “continue its already excellent program” and continue to be the testing area of motor vehicle standards, which is expected to benefit its people and the nation by strengthening federal standards.²⁹² The Senate report reflected opposition to displacing California’s right to set more stringent standards, as justified by California’s “unique problems and pioneering efforts.”²⁹³ Members of Congress concurred with the principle that California’s advances in air pollution regulation should not be nullified and that the state’s progress should not be impeded. Congressman John Dingell stated: “To penalize California for being ahead of the rest of the country in combating the menace of air pollution is totally incomprehensible.”²⁹⁴ The Ninth Circuit has also stated that California should be “encouraged to continue and to expand its efforts . . . to lower carbon emissions.”²⁹⁵ Thus, Congress’s reasons for granting California a waiver continue to be compelling and extraordinary, and California’s current needs continue to remain relevant as ever in justifying the Clean Air Act waiver provision.

Congress did not justify the Clean Air Act waiver provision based on whether pollution problems were of a more local or global nature, but rather on the unique effects of smog in the Los Angeles area.²⁹⁶ This emphasis suggests that Congress intended to give California the flexibility to adopt motor vehicle standards that the state determines are needed to address air pollution in the state, regardless of whether those problems might also be global in nature.²⁹⁷ Thus, California’s problems are serious enough and its efforts are such a model for the nation that a waiver provision is necessary in order for California to adequately protect public health. More recently, Congress’s clarification in the 2022 Inflation Reduction Act that GHGs are pollutants regulated under the Clean Air Act suggests that Congress intends the Clean Air Act to include GHGs.²⁹⁸ This further strengthens the argument that California is acting within the scope of the Clean Air Act in regulating GHGs through its innovative motor vehicle program.

CONCLUSION

The equal sovereignty argument is a new attempt to invalidate the Clean Air Act waiver provision and California’s ability to regulate motor vehicle emissions. As of this Note, no court has specifically addressed the constitutionality of the Clean Air Act under the equal sovereignty principle, and the decision is pending for Ohio v. EPA, which is expected to address this constitutional question.

This Note concludes that the equal sovereignty principle does not apply to the Clean Air Act, but even if it were to apply, it does not invalidate section 209(b)(1). Distinguishing from the outcome in Shelby County, the Clean Air Act waiver provision remains constitutional because granting California an exemption is “sufficiently related to the problem that it targets.” First, the Clean Air Act targets the broader problem of public health from automobile emissions. Second, allowing California to implement more stringent motor vehicle regulations will directly help address this problem. Congress had strong justifications for granting California an exemption which continue to remain compelling and relevant today. California’s history with air pollution control, its large economy, and its characteristic geographic and climate conditions put the state in a unique position to influence the automobile market and address GHG emissions. California faces new and increasingly formidable threats from climate change, which have exacerbated the existing problems that initially compelled California’s motor vehicle regulations. Allowing California broad discretion to regulate GHG emissions is directly related to Congress’s goal of addressing the public health threats from motor vehicle pollution in California because the effects of GHGs and smog are directly related and affect one another. Even as California’s motor vehicle regulations have shifted from reducing local smog by regulating criteria pollutants to reducing GHG emissions by eliminating gasoline-powered cars, California’s current needs continue to justify its differential treatment—maintaining, and perhaps even strengthening, section 209(b)(1)’s relevance in the twenty-first century.

The court’s decision on whether section 209(b)(1) of the Clean Air Act remains constitutionally valid will determine the extent to which California can continue to realize the localized benefits of the Clean Air Act while helping accelerate the nation’s transition towards a clean energy economy. It will also have implications for California’s ability to continue to regulate GHG emissions as a leader in addressing the most pressing environmental issues of the day.

Is the court going to handcuff California’s ability to protect the health and safety of its residents in the name of equal sovereignty? That was not the intention of Congress when it discussed equal sovereignty concerns pertaining to the Clean Air Act waiver. On the contrary, Congress debated whether other states should also be able to enact more stringent standards than the federal government, which would be the more reasonable remedy if the Clean Air Act waiver provision were deemed unconstitutional per equal sovereignty, as the petitioners demand.

To strengthen the ability of motor vehicle regulations to withstand future court challenges, California could emphasize criteria pollutants in its regulations. Since criteria pollutants have been more directly linked to local air pollution issues and Congress originally implemented the waiver provision in response to regional smog problems, this change could make it more difficult to challenge a regulation on the basis of it only regulating climate change. It will likely be simpler to show that the disparate treatment of California is sufficiently related to the problem that the Clean Air Act targets if legislators explicitly provide how they expect the regulations to affect local air quality as well as the local co-benefits of implementing them. For example, replacing internal combustion passenger vehicles with EVs will reduce not only GHG emissions, but also criteria pollutants including nitrogen oxides that are emitted.

California’s motor vehicle standards alone may not reverse or solve climate change, but the EPA has a duty to take steps to slow or reduce it.²⁹⁹ Allowing California to continue to promulgate innovative, forward-looking motor vehicle standards is crucial to its ability to lead the country as a “laboratory of innovation,” as Congress intended, and address the urgent environment and public health consequences of motor vehicle pollution.

97 S. Cal. L. Rev. 165

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Justine Huang*

* Senior Editor, Southern California Law Review, Volume 97; J.D. Candidate 2024, University of Southern California Gould School of Law; B.A. Economics 2019, Wellesley College. A special thank you to Professor Robin Craig for her thoughtful guidance, my friends and family for their consistent support and encouragement, and the Southern California Law Review editors for their thorough feedback.

An Empirical Study of the Enforcement of Liquidated Damages Clauses in California and New York by Luca S. Marquard

September 2021March 2022Southern California Law Review Admin

Article | Remedies
An Empirical Study of the Enforcement of Liquidated Damages Clauses in California and New York
by Luca S. Marquard*

From Vol. 94, No. 3
94 S. Cal. L. Rev. 637 (2021)

Keywords: Liquidated Damages, Penalty Clause, California Law, New York Law

A liquidated damages provision is a contract clause that predetermines the measure of damages in case a party breaches an agreement. Liquidated damages clauses are among the most commonly used contract clauses and are standard practice in most commercial agreements.1 Parties typically include such clauses in their contracts in an attempt to minimize anticipated litigation time and cost and to avoid the unpredictability of courts’ damages calculations. The renegotiation leverage gained from a liquidated damages clause provides incentive for a party to bargain for the inclusion of such a clause, especially if the party considers itself likely to be the nonbreaching party in any potential dispute. However, in reality, the security parties get from including a liquidated damages clause in their agreement is far from absolute. While certain types of liquidated damages clauses are more likely to be enforced than others, these clauses cannot confidently be relied on by practitioners. Despite a common perception to the contrary, this Note will show that such unreliability exists across jurisdictions.

American courts distinguish between valid liquidated damages clauses and penalty clauses. Simply put, a valid liquidated damages clause compensates the nonbreaching party in the case of breach, while a penalty clause, as its name suggests, penalizes the breaching party and by its coercive nature serves to induce performance.2 The distinction between these two clauses, which is often difficult to make, is an important one: while liquidated damages clauses are enforceable, penalty clauses are unenforceable as being against public policy.3 Whether courts should continue to follow this distinction has been the subject of extensive scholarly debate. Rather than adding another voice to the clamor, this Note will take the current distinction between liquidated damages and penalty clauses as given.

Instead, this Note will examine and compare how courts in New York, the most important American contract law jurisdiction,4 and in California, the state with the largest economy,5 have applied the distinction in recent years. This Note will discuss trends in enforcement and reasoning gleaned from the detailed study of over fifty of the latest court decisions on the enforceability of liquidated damages clauses in each California and New York. In doing so, this Note will test the validity of two hypotheses. The first hypothesis is that courts across jurisdictions are more likely to enforce liquidated damages clauses if the parties to the agreement are sophisticated. The second hypothesis is that New York courts are more likely than California courts to enforce liquidated damages clauses, and that this difference is most pronounced in consumer contracts.

Part I of this Note will provide an overview of the policy debate regarding whether the law should distinguish between liquidated damages clauses and penalty clauses and thus refuse to enforce penalty clauses. This Part will explain the most important arguments both in favor of and against enforcing penalty clauses and point out an argument regarding the theoretical foundation of liquidated damages.

Part II of this Note will describe the current state of the law of liquidated damages, articulating both the formal doctrine and how recent cases have interpreted it. This Part will outline the research methodology used for this project, give an account of first California and then New York law, before making a preliminary comparison of the approaches taken in the two jurisdictions.

Part III of this Note will discuss current trends in the enforcement of liquidated damages clauses in both California and New York, addressing characteristics of common transaction and clause types.

Part IV of this Note will analyze the importance of parties’ sophistication and the negotiation process to courts’ decisions on the enforceability of liquidated damages clauses.

This Note will make two significant contributions to the legal scholarship in this area. First, by describing the findings of an extensive empirical case survey, this Note will provide practitioners with an on-the- ground view of how courts actually treat liquidated damages clauses. This will give attorneys and their clients a better understanding of whether to include liquidated damages clauses in their agreements, how to phrase them, and, when considering breaching an agreement, whether a clause is likely to be enforced.

Second, this Note will ultimately draw several significant conclusions from this empirical analysis. The first being that there is no significant difference between California and New York courts’ treatment of liquidated damages clauses. Courts in both jurisdictions are more likely to enforce liquidated damages clauses in agreements between sophisticated parties. Further, there is no significant difference between how California and New York courts enforce liquidated damages clauses, both generally and against consumers and unsophisticated parties. This Note argues that this is due, at least in part, to the importance of sophistication and negotiation in courts’ determination of the enforceability of liquidated damages clauses. The absence of a significant difference between California and New York courts’ enforcement of liquidated damages clauses calls into question the widely held belief that New York courts take a formalist approach to contract law and that this makes New York an appealing jurisdiction for parties to business contracts. While New York law is the law of choice for parties to commercial contracts and generally preferred over California law,6 where liquidated damages clauses are concerned, parties choosing New York law likely do not receive the benefits they expect from their choice of law.

*. Senior Editor, Southern California Law Review, Volume 94; J.D. Candidate 2021, University of Southern California Gould School of Law; B.A. Economics 2018, University of California, Irvine. Thank you to Deena and Lora Fatehi for their unwavering support and companionship during the writing process. In addition, thank you to Professor Jonathan Barnett for encouraging me to pursue this topic and for his guidance during the drafting of this Note. Finally, thank you to the talented Southern California Law Review editors for their excellent work.

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A Criminal Law Based on Harm Alone: The Story Of California Criminal Justice Reform by Joshua Kleinfeld & Thomas Hoyt

August 2021March 2022Southern California Law Review Admin

Article | Criminal Law
A Criminal Law Based On Harm Alone: The Story of California Criminal Justice Reform

by Joshua Kleinfeld* & Thomas Hoyt†

From Vol. 94, No. 1
94 S. Cal. L. Rev. 35 (2020)

Keywords: Criminal Law, California Law, State Law

For many criminal justice reformers, the Holy Grail of change would be a criminal system that ends the war on drugs; punishes minor property and public order offenses without incarceration (or does not handle them criminally at all); and reserves prison mainly for violent offenders. What few appreciate is that California over the last nine years has done exactly that, and the results are breathtaking in their magnitude and suddenness: from 2011 to 2019, California released 55,000 people convicted mostly of nonviolent offenses (a quarter to a third of all California prisoners) and has been declining imprisonment—which often means declining arrest and prosecution altogether—for tens of thousands more who likely would have been imprisoned a decade ago. The changes happened piecemeal; this Article is the first to put the whole picture together. But we are now in a position to describe and evaluate the whole.

We come to three conclusions. First, California criminal justice reform reduced incarceration without increasing violence, but in so doing increased property crime, public drug use, street-level disorder, and likely homelessness to such an extent as to change the texture of everyday life in some California cities, including Los Angeles and San Francisco. Second, these changes alter the relationship between individual and state substantially enough to constitute a new social contract: California has gone farther than any other American state toward a society based on John Stuart Mill’s harm principle.

Third, this array of costs and benefits is complex and nuanced enough that it is not irrational or otherwise normatively illegitimate for someone to think them either justice-enhancing or -diminishing, good for human welfare or bad for it. But what unequivocally redeems California’s new policies for California are their democratic credentials: they were accomplished through a series of elections over multiple years at multiple levels of government with a high degree of public deliberation. Criminal justice democratizers and strong proponents of federalism should endorse what California has done as a matter of political self-determination. But they might rationally not want the same thing for their own states.

*. Professor of Law and (by courtesy) Philosophy, Northwestern University. †. JD Candidate, Northwestern University Pritzker School of Law.

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An Impossible Standard: The California Parole Board Process for Inmates with Cognitive Impairments – Note by Amber Heron

July 2018October 2018Southern California Law Review Admin

From Volume 91, Number 5 (July 2018)
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An Impossible Standard: The California Parole Board Process for Inmates with Cognitive Impairments

Amber Heron [*]

TABLE OF CONTENTS

INTRODUCTION

I. LAWS GOVERNING CALIFORNIA PAROLE HEARINGS

A. Background Information

B. Determinate and Indeterminate Sentences

C. Parole Suitability

D. Information Examined Prior to a Parole Hearing

E. Parole Hearing

F. Appeal of Parole Decision

G. California’s Parole Laws Disadvantage Inmates
with Cognitive Impairments

II. INDIVIDUALS WITH DEVELOPMENTAL DISABILITIES
IN CALIFORNIA PRISONS

A. Statistics Concerning Inmates with Disabilities

B. CDCR’s Definition of a Developmental Disability

C. The Americans with Disabilities Act

1. Armstrong v. Wilson

2. Armstrong v. Schwarzenegger

3. Clark v. California

III. ARGUMENT

A. Factors Considered in Parole Suitability Hearings

1. Comprehensive Risk Assessment

2. Rule Violations

3. Programming

4. Insight

5. The Board’s Discretion

B. Additional External Factors Affecting Parole
Suitability Hearings

1. CDCR’s Narrow Definition of a Developmental Disability

2. Learning Disorders

3. TABE Assessment

4. Unconstitutional Denial of Liberty Without Due Process

IV. RECOMmENDATIONS FOR THE CALIFORNIA PAROLE PROCESS WITH REGARD TO Prisoners WITH
COGNITIVE IMPAIRMENTS

A. Expanded Definition of Developmentally Disabled

B. Increased Commissioner and Correctional Officer
Training

C. Less Emphasis on Insight

D. Providing Psychological Evaluations and
Psychologist Testimony at Parole Proceedings

E. Amending Rule Violation Write-Ups

F. Fair Weight Given to TABE Scores

CONCLUSION

INTRODUCTION

How can one be expected to demonstrate something they are incapable of, and what if that something meant the difference between freedom and remaining in prison? Thousands of inmates in California face this issue, and many are kept incarcerated for life without any recognition of their cognitive capabilities.

Take Maria’s story,[1] for example; she is a client I became familiar with as a student working in the University of Southern California Gould School of Law’s (“USC”) Post-Conviction Justice Project (“PCJP”).[2] Maria had extensive cognitive impairments that went undiscovered while incarcerated in a California prison for nearly three decades. Because of this, Maria was denied parole an astounding six times with the parole board citing lack of “insight” each time. Maria’s continued denials persisted despite state-issued psychological evaluations concluding that her intellectual functioning was minimal.

Unfortunately, Maria’s predicament is not uncommon. There are several similarly situated inmates who are unable to effectively advocate for themselves due to their cognitive impairments, yet they are not provided with necessary accommodations. As a result, individuals are denied parole even though they do not pose a current danger to society. This culminates in the gravest deprivation of liberty without due process—denial of their freedom. [3]

In 2015, only 17% of California inmates were found suitable for parole.[4] In 2016, it dropped slightly to 16%.[5] The chances of release are even less for incarcerated individuals with cognitive impairments. This Note will provide an outline of the California parole process and explore the ways by which people with cognitive impairments [6] are disadvantaged by the current system.

First, this Note will explain the basic process of parole hearings in California and how an inmate may be found suitable for parole. Next, I will outline the current requirements that must be met for a person to be considered disabled in California’s prisons and discuss some of the groundbreaking California cases regarding inmates with disabilities. In order to provide proper context, I discuss the disabled population in prison, however, the primary focus of this Note is on the portion of California inmates that are not encompassed under the California Department of Corrections and Rehabilitation’s (“CDCR”) definition of developmentally disabled (“DD”).

Ultimately, this Note argues that California’s current parole system is legally impermissible due to the overlooked disadvantages it creates for inmates with cognitive impairments who do not fall within CDCR’s definition of disabled. As a result of CDCR’s exclusionary and limiting definition of a cognitive disability, numerous inmates are left with no access to accommodations that could help mitigate the unfairness their impairments present. Among the impairments inmates face are processing disorders, low cognitive functioning, and minimal formal education. Individuals who face impairments form a large population of potentially non-violent individuals who could be found suitable for parole, but because they have some cognitive limitation(s) that inhibit them from reaching the parole board’s specific standard, they cannot, and likely may never, meet the rigid suitability standards.

This Note argues that reform must come from re-envisioning the manner in which the parole process is administered and by applying a truly individualized approach. To be clear, the legal standard of current dangerousness is not at issue; it is the process by which the parole board determines a given inmate’s current danger that needs reform. Although many have evaluated the intersection between the DD population and the criminal justice system—including, for example, the often-unfair treatment and lack of opportunities at parole hearings for DD inmates [7]—few have studied inmates that fall into a “grey area.” That is, individuals who do not fall within the DD classification, but who cannot successfully meet the requirements of parole without a more personalized assessment.

I will advocate for a system that better identifies inmates that may not qualify as DD by the CDCR standard but still have limitations that preclude them from effectively self-advocating. For individuals who are identified, I argue that reasonable accommodations must be provided. In addition, I recommend the following changes: (1) increasing commissioner and correctional officer training for CDCR staff; (2) placing less emphasis on insight during a parole hearing; (3) providing a psychologist who can testify at each inmate’s parole proceeding; and (4) giving greater weight to an inmate’s score on their test for basic adult education (“TABE”). Although the parole board is required to assess each inmate’s suitability for parole on a “case-by-case”[8] basis, this current system does not adequately account for an individual’s cognitive impairments.

In sum, to remedy this impermissible system that results in discriminatory parole denials because of an individual’s cognitive impairment, inmates must be assessed at their ability-level and the formal, rigid standards currently in place must be changed.

I. LAWS GOVERNING CALIFORNIA PAROLE HEARINGS

A. Background Information

CDCR is the entity responsible for operating the California state prison and parole systems.[9] Upon completion of a prison sentence—either from the expiration of a determinate sentence or as a result of a parole suitability finding—an individual is “released to either state supervised parole or county-level supervision” pursuant to the California Penal Code.[10] Typically, individuals who commit more serious or violent crimes are released into state parole custody, and the less violent offenders receive county supervision.[11] As of January 31, 2018, CDCR had 129,557 individuals in its custody.[12] Of that number, 117,427 were housed and living in institutions.[13]

B. Determinate and Indeterminate Sentences

In California, most offenders are sentenced to a specified amount of time under the Determinate Sentencing Law (“DSL”).[14] This means that after an individual serves the imposed time—for example, seven years—he or she is released from prison on parole. Sometimes, an individual with a determinate sentence will become eligible for a parole suitability hearing prior to their scheduled release date.[15]

If an individual does not receive a determinate sentence, they are likely to receive an indeterminate sentence pursuant to the Indeterminate Sentencing Law (“ISL”).[16] An indeterminate sentence will be a term of life, with the possibility of parole, such as fifteen-years-to-life or twenty-five-years-to-life. These individuals are more commonly referred to as “lifers.” An individual serving a life term with the possibility of parole cannot be released from prison until the Board of Parole Hearings (“BPH”) determines they are ready to be reintegrated back into society.[17]

This Note primarily focuses on inmates serving indeterminate sentences because inmates with determinate sentences rarely face a parole board. In 2013, there were approximately 32,000 inmates in California serving life sentences with the possibility of parole and an additional 3,200 inmates sentenced to life without the possibility of parole.[18] As of April 2013, California had more than “three times as many lifers” as any other state.[19]

C. Parole Suitability

A life-term inmate must serve a certain statutory period before becoming eligible for a parole suitability hearing.[20] When an inmate becomes eligible for parole, BPH administers a parole hearing.[21] BPH then makes a legal determination concerning whether an inmate poses a “current, unreasonable risk of danger to the public.”[22] The language of California Penal Code section 3041 is unambiguous when it states that the parole board, or panel, “shall grant parole to an inmate unless . . . consideration of the public safety requires a more lengthy period of incarceration.”[23] This mandatory language is what creates a “constitutionally protected liberty interest” in parole.[24] Despite this “statutory mandate,” an indeterminately sentenced California inmate is granted parole “less than 1 percent” of the time at their initial suitability hearing and “roughly 18 percent” overall.[25]

A panel consisting of two individuals—a presiding commissioner and a deputy commissioner (collectively, “the Board”)[26]—will together consider “[a]ll relevant, reliable information” to make a parole suitability determination.[27] Commissioners are appointed to three year terms by the governor of California, subject to confirmation by the state senate.[28] California has fourteen Governor appointed commissioners.

Title 15 of the California Code of Regulations (“CCR”) sets out a list of factors to be considered in determining an inmate’s suitability for release on parole, although it is not exhaustive.[29] The Board is tasked with balancing these suitability and unsuitability factors.

There are nine enumerated factors that indicate circumstances tending to show suitability: (1) no juvenile record; (2) stable social history; (3) signs of remorse; (4) motivation for crime; (5) battered woman syndrome; (6) lack of criminal history; (7) age; (8) ability to understand and plan for the future; and (9) institutional behavior.[30] Additionally, and with much significance, the California Supreme Court held that “insight bears more immediately on the . . . present risk to public safety” of an inmate, in comparison to other suitability factors considered.[31]

Factors weighing toward unsuitability are: (1) the commitment offense—particularly if the prisoner “committed the offense in an especially heinous, atrocious or cruel manner;”[32] (2) previous record of violence; (3) unstable social history; (4) sadistic sexual offense; (5) psychological factors; and (6) poor institutional behavior.[33]

These factors, taken in their entirety, determine the outcome of a parole hearing. Further, the California Supreme Court held, with regard to parole decisions, that whether an inmate is found suitable and thus released on parole, or instead given a three–to–fifteen–year set-off depends on the Board’s nearly unlimited discretion.[34] Given this wide range of discretion, coupled with virtually unlimited unsuitability factors, the possibility of being released on parole is slim.[35]

For individuals with cognitive impairments, moreover, the odds of being granted parole are even worse.[36] For example, inmates with cognitive impairments can face particular difficulties with demonstrating insight because insight-based questions often require the articulation of abstract ideas, an ability that inmates with developmental disabilities may not possess. In addition, certain cognitive disabilities significantly affect subjective emotional cues, making expressions of remorse more challenging.

Ultimately, being found suitable for parole is not only dependent on how effectively an inmate can verbally communicate and articulately respond to multi-faceted questions at an actual hearing, but also on their behavior in prison and even their record prior to incarceration.[37]

D. Information Examined Prior to a Parole Hearing

Before a parole hearing, the Board receives an inmate’s central file (“C-File”), results of the inmate’s Comprehensive Risk Assessment (commonly referred to as “psych evals”), all rule violations in prison, vocational and educational certificates, letters supporting and opposing parole, and victim-impact statements.[38] In addition to written statements, the victims and victims’ families are permitted to attend and speak at the parole hearing.[39]

“Marsy’s law” is responsible for a wide expansion of victims’ rights.[40] In particular, Marsy’s law allows victims or representatives of victims to make statements at an inmate’s parole hearing, in which they “reasonably express their views concerning the prisoner, including . . . the effect of the crimes on the victim’s family, and the prisoner’s suitability for parole.”[41] Some argue that the presence of victims at parole hearings increases the chance of receiving a denial.[42]

E. Parole Hearing

The parole hearing itself is normally several hours long, occurs on–site where the individual prisoner is incarcerated, and is typically administered by the Board asking the inmate several questions.[43]

Parole hearings traditionally follow a similar structure, in which the inmate is asked about his or her life in chronological order.[44] The inmate’s childhood, adolescence and, if applicable, adulthood are discussed. After that, the commitment offense is discussed, often at great length. The commitment offense, a static factor that cannot be changed despite the passage of time, can prove challenging for inmates, especially those with heinous or violent crimes.[45] Thereafter, the inmate’s time while incarcerated is discussed, including both negative factors, such as rule violations, and positive factors, such as programming and certificates that document good behavior.[46] Lastly, parole and relapse prevention plans are discussed.

All inmates are entitled to legal counsel at their parole hearing.[47] California is required to provide counsel for inmates who want representation, but otherwise do not have an attorney. The state, however, only compensates parole-appointed attorneys a “maximum $400 per case.”[48]

In addition to the two commissioners, the inmate, and his or her attorney (if the inmate elected to have one present), a District Attorney from the prosecuting county of the controlling offense can be present to ask clarifying questions as well as to make a statement about the inmate’s suitability for parole.[49] Almost always, the District Attorney opposes the inmates release on parole.

After an hours–long hearing is conducted, the commissioner and deputy commissioner privately deliberate to make a parole determination.[50] In rare cases, a hearing may be continued, but almost always an inmate will either be found suitable for parole, known as receiving a grant, or the inmate will be denied parole.[51] If the inmate is found unsuitable for parole, the Board “shall schedule the next hearing . . . [f]ifteen years after,” unless “clear and convincing” evidence exists to schedule the next hearing in either ten, seven or three years.[52] Thus, the default denial of parole in California results in a fifteen year set-off, which itself indicates the gravity of parole hearings.[53] Prior to the passage of Marsy’s Law in 2008,[54] the governing statute presumed a set-off of only one year and allowed commissioners to set a maximum denial of five years.[55]

After the Board issues its decision on the day of the hearing, BPH has 120 days to review and finalize the decision.[56] Once the Board’s decision has been finalized, the presiding California governor has thirty days to review the decision.[57] For homicide offenses, the governor may “affirm, modify, or reverse” the Board based on the same factors the Board considers.[58] In every other case, the Governor is “limited to remanding the case back to the Board for reconsideration.”[59]

F. Appeal of Parole Decision

In the event of a denial or grant reversal by the Governor, an inmate may file a habeas corpus petition in a California state court to challenge the denial.[60] As determined by the California Supreme Court, the decision to grant or deny parole is “subject to a limited judicial review to determine only whether the decision is supported by ‘some evidence.’”[61]

The “some evidence” standard has been widely contested but consistently reaffirmed by California courts.[62] In accordance with California’s Constitution and statutes, the executive branch is vested with the decision to grant parole to an inmate in CDCR’s custody.[63] The California Supreme Court stated in In re Shaputis that “[i]t is the job of a reviewing court” to apply the “deferential ‘some evidence’” standard to the parole determination.”[64] Justice Corrigan acknowledged that the court may be skeptical of the stated reasons of the Board for a parole denial; however, “considerations of judicial restraint and comity between the executive and judicial branches counsel against including mere suspicions in the court’s opinion.”[65] As a result of this deferential standard, parole denials are commonly upheld.

G. California’s Parole Laws Disadvantage Inmates with Cognitive Impairments

The stringent requirements of the California parole board process disadvantage inmates with cognitive impairments both prior to and during their parole hearings. As it currently stands, the parole process demands certain abilities. A parole hearing moves quickly with several abstract, complicated questions asked in an unforgiving manner. Processing disorders, minimal education, and the inability to retain or recite information can each jeopardize an inmate’s possibility of being found suitable for parole. Because of the inflexible structure and immutable demands placed on inmates at parole hearings, it ultimately amounts to a process that systematically disadvantages inmates with cognitive impairments.

II. INDIVIDUALS WITH DEVELOPMENTAL DISABILITIES IN CALIFORNIA PRISONS

A. Statistics Concerning Inmates with Disabilities

The Bureau of Justice’s statistics state that “1 in 5 prison inmates have a serious mental illness.”[66] In addition, the Bureau states that individuals in federal prisons are almost “three times as likely to report having a disability as the nonincarcerated population.”[67] Among the most common inmate-reported impairments are “Down syndrome, autism, dementia, intellectual disabilities, and learning disorders . . . .”[68] The most commonly reported impairments nationwide were impairments with learning, with 23% of all state inmates saying that they struggled with learning.[69] Improper testing for disabilities and a lack of self-reporting also affects these statistics.[70] These statistics indicate that individuals in prison are more likely to be suffering from some sort of mental disorder than the non-incarcerated population.[71] In addition, further distortion of these numbers occurs due to a lack of self-reporting and when, “in most instances, the [developmentally disabled] inmate is not identified, and so is mainstreamed with the general . . . prison population.”[72]

In addition, the statistics are influenced because inmates may be hesitant to admit to having a cognitive impairment, fearing the stigmatization that comes with such an admission. Given the choice, many inmates would prefer to avoid being labeled as disabled, or seen as different, even if it means sacrificing the possibility of being successful at a future parole hearing. This is especially true for inmates who do not formally meet CDCR’s DD definition. In such cases, an inmate who admitted having an impairment may face stigmatization, yet, under current law, no additional assistance would be provided to this inmate.

B. CDCR’s Definition of a Developmental Disability

As defined by CDCR, an individual is considered to have a DD if the disability “originates before an individual attains the age of 18, continues—or can be expected to continue—indefinitely, and constitutes a substantial handicap for that individual.”[73] The disabilities noted include cerebral palsy, epilepsy, and autism. In addition, an individual is considered to have a developmental disability if they have “disabling conditions found to be closely related to mental retardation . . . .”[74]

The Clark Remedial Plan [75] states that criteria for inclusion in the Developmental Disability Program (“DDP”) are: (1) “[l]ow cognitive functioning (usually IQ of 75 or below); and (2) [c]oncurrent deficits or impairments in adaptive functioning.”[76] Both elements must be met to qualify as a DD individual under CDCR’s standard.[77] Being classified for inclusion in the DDP is pertinent to whether a person has access to the treatment and accommodations that may be necessary for an eventual parole suitability finding.

During intake, CDCR assesses all inmates for potential inclusion in the DDP.[78] Certain characteristics that may present in an individual with developmental disabilities include concrete reasoning, limited or below age–level communication skills, a short attention span, and difficulty retaining information. In addition, people with developmental disabilities may exhibit noncompliant behavior and struggle to understand the consequences of their actions.[79]

C. The Americans with Disabilities Act

The Americans with Disabilities Act (“ADA”) was signed into law on July 26, 1990 with the intent to protect the rights of individuals with disabilities from pervasive discrimination.[80] The rights afforded in the ADA extend to state prisoners.[81] In accordance with the ADA, along with the Rehabilitation Act of 1973, an institutional staff member is required to meet with an inmate to identify “any disability-related accommodations needed for the [parole] proceeding.”[82] The findings and requests by the inmate are memorialized in BPH’s 1073 form, which is titled a “Notice and Request for Assistance at Parole Proceeding.”[83]

Despite the mechanisms currently in place to help account for an individual’s disability, CDCR and BPH have faced notable class action suits challenging the notion that proper accommodations exist and are enforced.[84] The most note-worthy cases of this kind are Armstrong v. Wilson,[85] Armstrong v. Schwarzenegger [86], and Clark v. California.[87] These cases are discussed in further detail in the Sections that follow.[88]

1. Armstrong v. Wilson

In Armstrong v. Wilson, the court stated that the ADA does apply to state correctional facilities.[89] The ADA plainly states: “[N]o qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any public entity.”[90] Thus, California prisons must abide by the provisions in the ADA.[91] Two years after the decision in Armstrong v. Wilson, the Supreme Court ended ongoing circuit splits on this issue by holding in Pennsylvania Department of Corrections v. Yeskey that “the plain text of Title II of the ADA unambiguously extends to state prison inmates.”[92]

2. Armstrong v. Schwarzenegger

On June 29, 1994, inmates with disabilities filed suit against CDCR and the Board of Prison Terms (“BPT”),[93] alleging that they were being deprived of their required accommodations due to their disabilities.[94] Initially, this class action suit did not include individuals with developmental disabilities, but was amended in January 1999 to include them.[95] The parties agreed to bifurcate the proceedings into two separate litigations—one involving CDCR and another with BPT. CDCR entered into a settlement agreement premised on a finding of the Armstrong court that the ADA and Rehabilitation Act of 1973 extend to prisons—as noted above, the court ruled in Armstrong v. Wilson that both statutes apply to state prisons.[96]

The claims against BPT were litigated in a bench trial beginning in April 1999.[97] Included in the plaintiffs’ evidence were stories about a deaf prisoner being “unable to communicate with a sign language interpreter because he was shackled” and a “blind inmate left without assistance to read complicated written materials.”[98] In March 2001, the court issued a permanent injunction ordering California to comply with the ADA and the Rehabilitation Act of 1973.

After an appeal by the State in November 2001, the court entered a Revised Permanent Injunction on February 11, 2002.[99] The injunction required the State to:

create and maintain a system for tracking prisoners and parolees with disabilities, take reasonable steps to identify prisoners and parolees with disabilities prior to parole proceedings, and provide reasonable accommodations to prisoners and parolees with disabilities at all parole proceedings, including parole revocations and revocation extensions, life prisoner hearings, mentally disordered offender proceedings, and sexually violent predator proceedings.[100]

After failing to comply fully with the injunction, the plaintiffs sought and were awarded an enforcement motion against BPT on May 30, 2006.[101]

In January 2007, a separate injunction was issued after a finding that “despite extensive monitoring of CDCR Institutions,” the state of California was “continuing to severely violate the rights of prisoners with disabilities.”[102]

3. Clark v. California

On April 22, 1996, two inmates incarcerated in California with developmental disabilities filed a class action lawsuit citing discrimination due to their disabilities.[103] In 1998, prior to the start of trial, the two parties negotiated an interim agreement.[104] As a result of this negotiation, the Clark Remedial Plan (“CRP”) was issued on March 1, 2002.[105] This plan details the DDP in California prisons.[106] It includes policies pertaining to the “identification, appropriate classification, housing, protection and nondiscrimination of inmates/parolees with developmental disabilities.”[107]

In July 2009, the defendants—the state of California, California Governor, CDCR, and prison officials—filed a motion to “terminate the Settlement Agreement & Order,” known as the CRP, arguing that continued relief was no longer necessary.[108] The court denied the State’s motion for relief and granted, in part, the prisoners’ motion for further relief.[109]

III. ARGUMENT

In California, there exists only one mechanism—a parole hearing—for an inmate to demonstrate that they no longer pose a current danger to society and thus should be granted parole.[110] This current system for determining if parole should be granted or denied is dependent not only on whether an inmate possesses the necessary factors supporting parole, but also on their ability to clearly articulate these factors.[111] Given many inmates’ low cognitive abilities—whether labeled as disabled by CDCR standards or not—it is much more difficult for these individuals to clearly interpret and process questions asked at their Comprehensive Risk Assessment and their parole hearing and to articulate answers to questions about insight and remorse. From the parole hearing structure, to a lack of accommodations, to sub-par training for commissioners and correctional officers, the current California parole system is impermissible and ultimately unconstitutional for individuals with cognitive impairments.[112]

There are numerous studies which indicate that inmates who are developmentally disabled will be “unlikely to be able to follow general prison rules, participate in work or treatment programs,” and face “a higher risk of victimization than higher-functioning inmates.”[113] Further, “[t]heir failure to comply with the prison routine” and difficulty or inability “to read and to understand prison rules and to advocate effectively for themselves, contributes to them more often being denied parole.”[114] In fact, research demonstrates that “inmates with mental retardation tend to serve longer sentences because of their higher frequency of infractions in prison and have greater difficulty securing parole.”[115]

From these research results about inmates who are recognized as DD, we can infer that individuals with cognitive impairments that are undiagnosed are just as likely to experience these issues, ultimately resulting in a parole denial. Because the Board does not adjust its suitability standard for inmates with cognitive impairments, individuals with cognitive impairments may end up staying in prison for far longer, resulting in arguably unconstitutional sentences. To remedy this, commissioners at parole hearings should not only be required to consider an inmate’s level of cognitive functioning, but also be mandated to run parole hearings in accordance with the inmate’s ability-level.[116]

A. Factors Considered in Parole Suitability Hearings

Below is a list of factors, though not exhaustive, that are considered during a parole suitability hearing. These statutorily mandated factors tend to disadvantage individuals with cognitive impairments because each of them requires some level of advanced processing and communication ability.

1. Comprehensive Risk Assessment

Prior to a parole suitability hearing, the Forensic Assessment Division of BPH issues a Comprehensive Risk Assessment to all inmates.[117] The purpose of the risk assessment is to help identify an inmate’s “potential for future violence and protective factors that could minimize his or her risk if released to the community.”[118] When performing the evaluation on the inmate, the assessment may include inquiries into the inmate’s “commitment offense, institutional programming, past and present mental state, and analysis of static and dynamic risk factors” as well as “emotions and attitudes, and perceptions and attributions.”[119] The inmate can receive a “final risk ratings of low, moderate, or high risk for violence . . . .”[120] Assessments are administered every five years.[121] For a realistic chance at parole, an inmate should receive a “low” score on their risk assessment. Anything higher gives the Board greater discretion to deny parole.[122]

Pursuant to CDCR’s rules, an inmate is unable to appeal the results of their Comprehensive Risk Assessment.[123] The inmate, along with his or her attorney, can, however, contest the findings of the assessment at their parole hearing.[124] The hearing panel, at its discretion, will determine how heavily to weigh the Comprehensive Risk Assessment.[125] In practice, the commissioners often place substantial weight on the findings contained within the Comprehensive Risk Assessment.

The susceptibilities of the Comprehensive Risk Assessments should be examined more closely, given how heavily the Board relies upon such assessments. The atmosphere, pressure, nervousness, and potential confusion of questions being asked can lead an inmate to present poorly. It is administered in prison, and the inmate goes into the assessment with an acute awareness of the implications of the score they receive. Thus, before the assessment even begins, there is heightened pressure on the inmate. These external factors can be especially damaging to those who have undiagnosed cognitive impairments.

2. Rule Violations

For the primary purpose of safety—for the correctional officers, other employees, and fellow inmates—prison policies are very strict.[126] The majority of inmate rule violations occur and are documented as either a custodial counseling chrono, also known as a “128,” or a more serious rule violation report, referred to as a “115.”[127]

Violations that constitute a 128 include: “[p]ossession of contraband other than controlled substances,” “[m]isuse of food,” “[o]ut-of-bounds presenting no threat to facility security,” “[m]isuse of telephone privileges,” “[m]ail or visiting violations,” “[f]ailure to meet work or program expectations,” “[l]ate for or absent without authorization from a work or program assignment,” “[u]se of vulgar or obscene language,” and “[f]ailure to comply with departmental grooming standards.”[128]

An inmate may receive a 115, a more serious write-up, for “[t]he use or threat of force or violence against another person,” “[a] breach of or hazard to facility security, “serious disruption of facility operations,” “introduction, use, or possession of controlled substances or alcohol,” “[p]ossession of dangerous contraband,” and “[a]ny felony offense.”[129] The high demands placed on inmates may make it very difficult to avoid receiving disciplinary citations despite an inmate’s best effort to do so.

The extensive list of rules inmates must follow at all times while incarcerated exists for purposes of efficiency, management, and promoting safety.[130] For inmates with cognitive impairments, non-adherence to obscure and sometimes unknown rules that result in rule violation write-ups can be exceptionally detrimental at a parole hearing. Navigating the prison system requires a level of savviness that many DD inmates simply do not possess.

At a parole hearing, any rule violation received while incarcerated will be discussed.[131] In addition, the Board will critically assess more recent rule violations and write-ups from the year leading up to the hearing—so these can be especially damaging.[132] Rule violations are heavily relied upon as a basis for denying parole.[133]

For inmates classified as having a developmental disability or a documented mental health disorder, a slightly modified procedure is followed.[134] If, at the time of a citation “the inmates behavior was so strongly influenced by symptoms of mental illness or developmental disability/cognitive or adaptive functioning deficits,” the mental health staff can recommend that the rule violation be documented in an “alternate manner.”[135] After review by the correctional officer captain, he or she can choose to ignore the recommendation and still give a write-up or can decide to place a memorandum in the inmate’s file documenting the reason not to issue the 128 or 115.[136] Ultimately, however, a record will exist discussing the incident and may be inquired into at a parole suitability hearing.

Despite this specific regulation aimed to help the DD prisoner population better navigate the system and prevent unfair violations, the inmate must still be able to discuss the rule violations they receive, along with any similar incidents, in an articulate and insightful manner at a parole hearing. Not only must the prisoner admit to their improper conduct, but they must also explain the motivations behind such behavior. People with cognitive impairments are expected to answer these questions despite the fact that their ability to process and communicate is often compromised as defined by their disability.[137]

3. Programming

During an individual’s parole suitability hearing, a part of the hearing is dedicated to assessing the programming they have engaged in while incarcerated.[138] The Board will look for programming relevant to a problem an inmate may have had prior to incarceration, especially if the inmate’s commitment offense was related to the problem. For example, if an inmate’s offense was gang-related, the inmate will almost certainly need to have programmed with Criminal Gangs Anonymous (“CGA”) or a similar gang-prevention program. In addition, inmates with addiction issues will likely need programming with Narcotics Anonymous (“NA”) or Alcoholics Anonymous (“AA”). Inmates will often be asked to recite the twelve-steps at their hearing and discuss how each step has helped with their sobriety.[139] The ability to retain and recite the steps and to explain how each step impacted an inmate’s sobriety may simply be beyond the ability-level of inmates with certain cognitive impairments. Therefore, recognizing an inmate’s limitations is essential for purposes of a fair proceeding.

In addition, access to programs can be limited—especially for males at higher-level security prisons—and knowing which programs to take can be hard—especially for someone with cognitive impairments. Even if an inmate successfully participates in programs, they must also be able to precisely detail what they learned and how it changed their internal thinking. For an inmate who functions at a lower cognitive level, this specific type of articulation may be unachievable. The Board, however, does not account for that inability.

4. Insight

Insight is defined as “the power or act of seeing into a situation,”[140] or “[t]he capacity to gain an accurate and deep understanding of someone or something.”[141] The concept of “insight” has increasingly influenced California jurisprudence concerning prisoners’ parole hearings.

For example, in 2008, the California Supreme Court issued its opinion in In re Lawrence, which affirmed a California Court of Appeal’s finding that the Governor’s reversal of a parole grant was improper. In its decision, the Court relied heavily on the inmate’s insight, stating that upon incarceration she “lacked emotional insight;” however, over time, she gained “substantial insight” in relation to “both the behavior that led to the murder and her own responsibility for the crime.”[142] Since then, the Board has focused immensely on insight at parole hearings.[143] A lack of insight is one of the most common reasons cited supporting the Board’s denial of parole.[144] As predicted, a denial or reversal by the Governor due to “lack of insight” has been substantially litigated.[145] The success of these petitions, however, has been limited given the “some evidence” standard used by courts to challenge Board denials.[146]

As stated by the California Supreme Court, “expressions of insight and remorse will vary from prisoner to prisoner and . . . there is no special formula for a prisoner to articulate in order to communicate that he or she has gained insight into, and formed a commitment to ending, a previous pattern of violent behavior.”[147] Lack of insight supports a parole denial when it is rationally indicative of the central issue of an inmate’s current dangerousness when considered in light of the full record.[148]

Courts have recognized the obstacles faced by inmates accused of a lack of insight, since the assertion of a lack of insight can be “shorthand for subjective perceptions based on intuition or undefined criteria that are impossible to refute.”[149] There is also the concern that insight has become the “new talisman” for denying parole.[150] When an inmate is denied his or her constitutional right for parole based on a lack of insight, the Board must find a “factually identifiable deficiency in perception and understanding” of the criminal conduct or its causes that is probative of current dangerousness.[151]

When . . . undisputed evidence shows that the inmate has acknowledged the material aspects of his or her conduct and offense, shown an understanding of its causes, and demonstrated remorse, the Governor’s [or Board’s] mere refusal to accept such evidence is not itself a rational or sufficient basis upon which to conclude that the inmate lacks insight, let alone that he or she remains currently dangerous.[152]

For example, in In re Denham, petitioner was denied parole based on a lack of insight because the Board speculated that he played a larger part in the commitment offense than he testified to.[153] The court concluded that “the Board cite[d] no evidence establishing that Denham’s participation in the crime was anything other than what he described at the 2010 parole hearing.”[154] Thus, the Court concluded that the Board reached its conclusion through improper speculation.[155]

The Court also held in In re Twinn that the Governor’s parole reversal violated due process because the Governor failed to establish a rational nexus between the prisoner’s alleged lack of insight and his current dangerousness.[156] Twinn was imprisoned after being convicted of second-degree murder.[157] Twinn had consistently denied his intention to kill the victim and clearly expressed remorse and accepted responsibility for his actions.[158] The Court reversed the governor’s denial, stating there was no “rational nexus” between Twinn’s description of his role in the murder and current danger to public safety—especially when taking into account Twinn’s remorse, acceptance of responsibility, and good behavior.[159]

Though California courts, in some cases, have recognized that a “lack of insight” has become a prevalent reason for denying parole,[160] the courts’ very deferential “some evidence” standard for review of Board (and Governor) decisions leaves courts with limited ability to address any issues stemming from the Board using this reason.[161] Extensive focus geared towards the “proper” demonstration of insight poses particular issues for inmates with certain cognitive disorders. Further, this heightened emphasis on insight is particularly odd given that “insight” is not even listed as either a suitability or unsuitability factor in the statute.[162] Courts nonetheless have “accepted the presence or absence of insight as a relevant factor within the Board’s authority,” even going as far as to qualify it as a “significant factor.”[163] This immense focus on an advanced concept like insight proves to be particularly damaging to individuals who cannot function or think at a highly abstract level.

5. The Board’s Discretion

Further, and perhaps most significant, is the power granted to commissioners to make parole suitability determinations.[164] The law, both statutorily and as interpreted by courts, affords commissioners extensive discretion to grant or deny parole.[165] The Board is tasked with assessing an inmate’s suitability on a case-by-case basis attempting to “balance . . . the interests of the inmate and of the public.”[166] With this broad discretion, commissioners are equipped with numerous bases on which to deny parole. For individuals who cannot conform to the Board’s precise expectations, a parole denial is a hearing’s most likely result.

An individual’s cognitive abilities are essential to processing and communicating information.[167] Therefore, prior to and during a parole hearing, an individual with impaired cognition will have a harder time than an individual without a cognitive disability to follow prison rules, excel in recommended or required programming, and communicate insight to the Board, thus, resulting in a higher likelihood of parole denial.[168]

B. Additional External Factors Affecting Parole Suitability Hearings

There are several external factors that, although not often captured during a parole proceeding, have significant implications for receiving a grant. Many of these factors begin far before an individual enters CDCR’s custody. They can start as early as birth, or during childhood, when an individual with a disability is improperly diagnosed or not diagnosed at all. In addition, impairments can develop or worsen if an individual is granted limited access to education. In CDCR custody, cognitive impairments that were not addressed prior to a prisoner’s incarceration may continue to go unacknowledged, leading to challenges in prison that are similar to those the individual experienced outside of prison. Ultimately, this lowers that individual’s chance at parole.

1. CDCR’s Narrow Definition of a Developmental Disability

CDCR’s determination of whether an individual falls within the DDP has far reaching implications. As currently written, CDCR’s narrow definition of a DD fails to encompass many inmates affected with impairments.

The Center for Disease Control (“CDC”) defines developmental disabilities as “a group of conditions due to an impairment in physical, learning, language, or behavior areas. These conditions begin during the developmental period, may impact day-to-day functioning, and usually last throughout a person’s lifetime.”[169] CDCR has a similar, but arguably stricter, definition.[170] Although there are still claims made by inmates with recognized developmental disabilities regarding unmet necessary accommodations, the arguably more difficult challenge lies with the thousands of inmates who do not fall within CDCR’s strict definition of DD, but have cognitive processing disorders or other intellectual impairments.

CDCR has several regulations designed to assist inmates who are included in the DDP.[171] For example, at a parole hearing of a person who falls within the DDP, staff assistance will be provided.[172] The assistance is usually a DDP counselor who does not provide legal advice, but can assist an inmate in understanding and participating in the parole hearing process.[173] However, inmates who have impairments but do not fall within CDCR’s DDP, such as an individual with a learning disorder, do not receive extra assistance at their parole hearing.[174]

Understandably, CDCR does not want to differentiate between inmates in the non-disabled group. For efficiency purposes, as well as cost concerns, treating all non-disabled inmates alike is alluring to prison officials. The problem, however, is that this practice is unjust and unreasonable. For example, cognitive impairments that preclude an inmate from effective, abstract thinking do not necessarily make them a “current danger” (the legal standard), yet time and again, an inmate in this position will be denied parole for “lack of insight.”[175]

At the crux of my argument lies a fundamental concept that the disability community commonly tries to convey—impairments, challenges, and disabilities are on a spectrum and cannot be defined or captured in a single definition easily.[176] The convenience of a bright-line definition for who qualifies as DD is understandably appealing to CDCR, but those who fall outside the bright-line definition, yet still possess cognitive impairments, must be provided a way in which their limitations will be identified, acknowledged, and considered during incarceration and at their parole hearing.

2. Learning Disorders

An example of the impact of CDCR’s limiting definition of a DD individual is demonstrated through its treatment of people with learning disorders. CDCR defines a learning disorder as “a cognitive disorder that affects the ability of persons with normal intellect to learn academic and social information.”[177] Examples of learning disorders include dyslexia and dyscalculia. CDCR does not test for learning disorders, but instead, an inmate may be considered to have one if they have a TABE score that is under 4.0.[178]

At a parole hearing for an inmate with a learning disorder, the only advocate is the inmate’s lawyer (inmates are entitled to have a lawyer present). No other assistance is provided to help mitigate the struggles that this individual could face.[179] CDCR states in all caps on their website that, “THE ATTORNEY IS THE BEST ACCOMODATION” for inmates with cognitive impairments.[180] Lawyers, however, are not professionally trained to best accommodate individuals with impairments and, as such, likely do not possess the required skills to properly address these unique challenges.

3. TABE Assessment

Another factor that is not statutorily mandated to be considered, and thus is often overlooked, is an inmate’s TABE score. Pursuant to the California Penal Code, all individuals housed in CDCR custody are issued a TABE after being placed in state custody.[181] The TABE is a diagnostic assessment that helps to determine an individual’s ability in English, math, and reading.[182] The TABE is used by CDCR, as well as other public service agencies, to help guide its determinations for what educational programs are needed for a given individual.[183]

CDCR divides its adult basic education (“ABE”) classes into three levels: ABE I classes are for individuals who score between zero and 3.9 on the reading portion, ABE II is for inmates who fall between 4.0 and 6.9 on the reading portion, and ABE III is for inmates who score between 7.0 and 8.9 in reading.[184] The California Penal Code states that the “department shall offer academic programming throughout an inmate’s incarceration that shall focus on increasing the reading ability of an inmate to at least a 9th grade level.”[185]

4. Unconstitutional Denial of Liberty Without Due Process

There are several problems with CDCR’s approach to the segment of inmate population that does not qualify as developmentally disabled, but nonetheless has impairments. For one, a lawyer, though required by law to represent their client to the best of their ability,[186] may be simply unfamiliar with the inmate’s impairments and not able to best accommodate them. Further, a parole hearing is not an official judicial proceeding, and thus, inmates are not afforded the same rights they would have in a court of law.[187] Inmates are expected and required to speak on their own behalf with little intervention from their attorneys.[188] Individuals who have cognitive impairments may not be able to adequately respond or engage at a parole hearing. As a result, a large segment of the prison population may be in need of supplemental resources even though they are not classified as DD.

Because there exists a wide array of cognitive impairments that inmates face and often those impairments are not formally acknowledged, many inmates who do not pose a current danger to society will remain in prison after attaining parole eligibility. This is a denies the inmates their due process rights.

IV. RECOMmENDATIONS FOR THE CALIFORNIA PAROLE PROCESS WITH REGARD TO Prisoners WITH COGNITIVE IMPAIRMENTS

People with cognitive impairments, especially those that are undiagnosed or not properly and thoroughly addressed, get in trouble more often in prison and have higher Comprehensive Risk Assessment scores. They also do not articulate insight and remorse as eloquently as non-disabled individuals. Because of this, and because the Board does not adjust its suitability standard for inmates with cognitive impairments, those individuals who no longer pose a danger to society may end up staying in prison for longer, ultimately resulting in unconstitutional sentences.[189]

A. Expanded Definition of Developmentally Disabled

CDCR’s current definition of developmentally disabled is extremely limiting.[190] I recommend expanding the definition to include those individuals who have cognitive impairments and are currently excluded. The DD population by its nature is extremely diverse. A more inclusive definition could help certain individuals receive the accommodations they require. While I respect the need to have a bright-line definition for administrative purposes, I think a more encompassing definition will capture some of the currently excluded inmates with little increase in administrative burden.

B. Increased Commissioner and Correctional Officer Training

Though CDCR, by definition, is a department that is supposed to focus on corrections and rehabilitation, its correctional officers and commissioners are inadequately trained to serve and promote the prisons’ rehabilitative functions. Currently, all of the commissioners and deputy commissioners that conduct parole hearings must, “[w]ithin 60 days of appointment and annually thereafter undergo a minimum of 40 hours of training in . . . educational, vocational, mental health, medical, substance abuse, psychotherapeutic counseling, and sex offender treatment programs.”[191] Although the training includes a portion on mental health, it does not focus specifically on developmental disabilities or the many nuances of the DD population. Further, forty hours of training per year is woefully inadequate to cover the numerous topics that are particularly pertinent to the prison population.

Similar to parole commissioners, the “corrections staff usually have little training on disability issues.”[192] The lack of professional training for correctional officers is arguably more damaging than the lack of training for commissioners because an inmate must first succeed in rehabilitating while incarcerated before having an opportunity to be successful at their parole hearing.

“California falls far behind some other states” in regard to rehabilitation.[193] In a study conducted by the University of California, Irvine that focused on the MR/DD population in prison, researchers found “virtually no specialized rehabilitation or substance abuse programs . . . in jail, or in prison[,] [that could] meet the unique needs of offenders with retardation.”[194] In the few jurisdictions that have special corrections programs for the DD, they have been shown to lead to “increased social functioning and reduced recidivism rates, while at the same time reducing corrections costs.”[195]

There needs to be more training of both correctional officers and commissioners, especially in the realm of cognitive impairments, because it affects a large segment of the prison population. The trainings need to increase knowledge and sensitivity to these issues as well as provide instruction on how to best interact, encourage, and rehabilitate individuals struggling with cognitive impairments. This would give inmates a fair chance to rehabilitate and demonstrate to the commissioners at their parole hearings that they are no longer a current danger to society. It is essential to expand awareness and give training tools to commissioners and CDCR employees.

C. Less Emphasis on Insight

After In re Lawrence, the Board’s focus on insight has increased substantially and has become one of the most important factors used to determine if parole will be granted.[196] Because insight is not a statutorily mandated factor and because it requires the ability to process ideas abstractly—in a way certain inmates are incapable of doing—the Board should focus less on insight, or at a minimum, be willing to accept a wider range of ways in which it can be demonstrated.

D. Providing Psychological Evaluations and Psychologist Testimony at Parole Proceedings

Another remedy that may improve California’s current parole system is to allow testimony of a mental health professional at all parole hearings. As of now, the inmate’s Comprehensive Risk Assessment is the only documentation that addresses this. However, the ultimate goal of the psychologist who administers the risk assessment is not identifying disabilities; rather, it is to determine how much of a public safety risk the inmate poses. Thus, the assessment likely underrepresents, or does not address at all, an inmate’s disabilities. Having a mental health professional attend all parole hearings could provide the commissioners with information on an inmate’s cognitive ability and add a necessary safeguard that the system is currently lacking.

E. Amending Rule Violation Write-Ups

Furthermore, I propose extending the amended procedure for administrating rule violations for inmates in the DDP to inmates who have cognitive impairments, but do not fall within CDCR’s stringent definition of a having a disability. This would allow individuals who function at a low cognitive level, or who have processing disorders, to explain their actions more fully. If someone, for example, cannot understand a rule, they should not be punished for it.[197]

F. Fair Weight Given to TABE Scores

Further, more weight and analysis should be given to an inmate’s TABE score at their parole hearing. This could better inform the commissioners of an inmate’s cognitive ability level. More importantly, there should be different rules for the hearing based on how the inmate scored on the TABE. If an inmate has a TABE score of under 4.0, the commissioners should be required to ask different questions and run the parole hearing in a different way than when interacting with an inmate whose score is above 9.0. Expecting an individual to perform beyond their ability results in an unfair parole proceeding.

CONCLUSION

Ultimately, the way the California parole board treats people with cognitive impairments is arguably illegal. Though the Clark Remedial Plan was intended to prevent some of the criminal justice system’s abuses against people with cognitive disabilities, it has failed on a multitude of fronts.

CDCR’s rigid and narrow definition of a developmental disability is too limiting. As a result, it excludes the large segment of the incarcerated population with cognitive impairments. This disadvantages that specific population both prior to and during their parole hearings because they are unable to meet the requirements of parole suitability. This system is impermissible and must be changed as it results in the continued incarceration of people who do not pose a current danger to society.

[*] *. Senior Submissions Editor, Southern California Law Review, Volume 91; J.D. 2018, University of Southern California Gould School of Law; B.A. Political Science 2011, University of Washington, Seattle. I would like to thank Professor Heidi Rummel for valuable guidance and feedback on earlier drafts of this note. In addition, I would like to thank the staff and editors of the Southern California Law Review for their excellent work.

[1]. Maria’s name and some facts have been changed to protect her identity and maintain confidentiality. Maria is the inspiration behind my note.

[2]. PCJP is a clinical program that represents male and female prisoners incarcerated in California state prisons. Among its clients, PCJP represents parole-eligible inmates serving indeterminate life sentences and juveniles sentenced to life without the possibility of parole.

[3]. See U.S. Const. amends. V, XIV.

[4]. See Cal. Dep’t of Corr. and Rehab., Parole Suitability Hearings 1 (2015), http://www.cdcr.ca.gov/BOPH/docs/Parole-Suitability-Hearings-updated-9.29.pdf (“In 2015, the Board held 5,300 parole suitability hearings and granted parole to 906 inmates.”).

[5]. Jazmine Ulloa, More California Inmates Are Getting a Second Chance as Parole Board Enters New Era of Discretion, L.A. Times (July 27, 2017), http://www.latimes.com/politics/la-pol-ca-parole-board-proposition-57-20170727-htmlstory.html. These statistics indicate that the likelihood of being found suitable for parole in California still remains quite low; however, it is significantly better than the past. In 2007, “less than 2%” of inmates were found suitable for parole. Id.

[6]. For purposes of this Note, I use the language “cognitive impairments” to differentiate between individuals who are formally identified as developmentally disabled in California prisons and those individuals who are not encompassed within that bright-line definition. The Center for Disease Control (“CDC”) defines an individual with a “cognitive impairment” as “a person [who] has trouble remembering, learning new things, concentrating, or making decisions that affect their everyday life.” Ctr. for Disease Control, A Cognitive Impairment: A Call for Action, Now! 1 (2011), https://www.cdc.gov/aging/pdf/cognitive_impairment/cogimp_poilicy_final.pdf. Much thought was given to the sensitivity surrounding the usage of the word “impairments,” and the term is intended only to be construed as the actual definition from the CDC.

[7]. See generally Joan Petersilia, Doing Justice? The Criminal Justice System and Offenders with Developmental Disabilities (2000) (discussing the “frequent victimiz[ation]” of inmates with developmental disabilities in the California parole process).

[8]. In re Powell, 755 P.2d 881, 886 (Cal. 1988).

[9]. See generally Cal. Dep’t of Corrections and Rehabilitation, CA.Gov, http://www.cdcr.ca.gov (last visited Aug. 20, 2018).

[10]. Sentencing, Incarceration, & Parole of Offenders, Cal. Dep’t of Corrections and Rehabilitation, http://www.cdcr.ca.gov/victim_services/sentencing.html (last visited Aug. 20, 2018).

[11]. Id.

[12]. Cal. Dep’t of Corr. and Rehab: Div. of Internal Oversight and Research, Monthly Report of Population as of Midnight January 31, 2018, 1 (2018), https://www.cdcr.ca.gov/Reports_Research/Offender_Information_Services_Branch/Monthly/TPOP1A/TPOP1Ad1801.pdf.

[13]. Id.

[14]. See Sentencing, Incarceration, & Parole of Offenders, supra note 10.

[15]. Id.

[16]. Id.

[17]. Id.

[18]. Keith Wattley, Insight into California’s Life Sentences, 25 Fed. Sent’g Rep. 271, 271 (2013).

[19]. Id.

[20]. Lifer Parole Process, Cal. Bd. of Parole Hearings, http://www.cdcr.ca.gov/BOPH
/lifer_parole_process.html (last visited Aug. 20, 2018).

[21]. Parole Suitability Hearings, supra note 4.

[22]. Lifer Parole Process, supra note 20.

[23]. Cal. Penal Code § 3041(b)(1) (West 2018) (emphasis added).

[24]. See Board of Pardons v. Allen, 482 U.S. 369, 374 (1987). See also Swarthout v. Cooke, 562 U.S. 216, 218 (2011).

[25]. Wattley, supra note 18, at 272.

[26]. Lifer Parole Process, supra note 20.

[27]. Cal. Code Regs. tit. 15, § 2281 (West 2018).

[28]. Cal. Gov’t Code § 12838.4 (West 2018).

[29]. Cal. Code Regs. tit. 15, § 2402 (West 2018).

[30]. Id.

[31]. In re Shaputis, 265 P.3d 253, 271 (Cal. 2011).

[32]. Cal. Code Regs. tit. 15, § 2402 (West 2018). This can be a particularly challenging factor for individuals who have committed violent crimes. Many have argued and litigated that a murder, for example, may always be considered “heinous” or “atrocious” and thus it provides the Board with an ability to deny parole on grounds that do not have a “rational nexus” to an inmate’s current dangerousness.

[33]. Id.

[34]. In re Rosenkrantz, 59 P.3d 174, 203 (Cal. 2002).

[35]. Parole Suitability Hearings, supra note 4.

[36]. See generally Petersilia, supra note 7.

[37]. Cal. Code Regs. tit. 15, § 2281(c)(5)–(6) (West 2018).

[38]. Robert Weisberg et al., Stan. Crim. Just. Ctr., Life in Limbo: An Examination of Parole Release for Prisoners Serving Life Sentences with the Possibility of Parole in California 7 (2011).

[39]. Cal. Penal Code § 3043 (West 2018).

[40]. See David R. Friedman & Jackie M. Robinson, Note, Rebutting the Presumption: An Empirical Analysis of Parole Deferrals Under Marsy’s Law, 66 Stan. L. Rev. 173, 198 (2014). Marsy’s law was enacted after Ms. Marsalee (Marsy) Nicholas was murdered by her ex-boyfriend. A week after Marsy was killed, Marsy’s mother and brother encountered Marsy’s ex, the accused murderer in a grocery store. Marsy’s family was not informed that he had been released on bail. Because of the bill’s passage, courts now must consider the “safety of victims and families when setting bail and release conditions.” See About Marsy’s Law: Justice with Compassion, Marsy’s Law, https://marsyslaw.us/about-marsys-law (last visited Aug. 20, 2018). In addition, family members are legally entitled to attend all bail hearings, pleas, sentencing and parole hearings. Id.

[41]. Victim’s Bill of Rights Act of 2008: Marsy’s Law, Cal. Bd. of Parole Hearings, http://www.cdcr.ca.gov/BOPH/marsys_law.html (last visited Aug. 20, 2018).

[42]. See Weisberg et al., supra note 38, at 20.

[43]. Id. at 22.

[44]. See id. at 7–8. See also Cal. Dep’t of Corr. and Rehab., Parole Suitability Proceeding Handbook: Information for Victims and Their Families 8–9 (2016).

[45]. Cal. Code Regs. tit. 15, § 2402 (West 2018).

[46]. See Weisberg et al., supra note 38, at 7–9.

[47]. Lifer Parole Process, supra note 20.

[48]. Beth Caldwell, Creating Meaningful Opportunities for Release: Graham, Miller and California’s Youth Offender Parole Hearings, 40 N.Y.U. Rev. L. & Soc. Change 245, 267 (2016). To competently prepare for a parole hearing, an attorney will need to spend much more than $400 worth of time. Preparation should include reviewing the inmate’s entire C-File which can be hundreds to thousands of pages long, as well as other pertinent documentation such as childhood and medical records. In addition, the lawyer should visit the client multiple times to moot and prepare for the difficult questioning at the hearing.

[49]. Lifer Parole Process, supra note 20.

[50]. See Parole Suitability Proceeding Handbook, supra note 44, at 9.

[51]. Parole Suitability Hearings, supra note 4.

[52]. Cal. Penal Code § 3041.5 (West 2018).

[53]. Id.

[54]. Victims’ Bill of Rights Act of 2008: Marsy’s Law, Cal. Const. art. I, § 28.

[55]. Friedman & Robinson, supra note 40, at 180.

[56]. Lifer Parole Process, supra note 20.

[57]. Cal. Penal Code § 3041.2 (West 2018).

[58]. Friedman & Robinson, supra note 40, at 181.

[59]. Id.

[60]. U.S. Const. art. I, § 9, cl. 2. California inmates have a right to file a federal habeas corpus petition challenging their parole denial. Swarthout v. Cooke, 562 U.S. 216, 219–22 (2011) (“[T]he responsibility for ensuring that the constitutionally adequate procedures governing California’s parole system are properly applied rests with California courts.”).

[61]. In re Rosenkrantz, 59 P.3d 174, 183 (Cal. 2002).

[62]. In re Shaputis, 265 P.3d 253, 264–68 (Cal. 2011). See also In re Lawrence, 190 P.3d 535, 538–39 (Cal. 2008); In re Rosenkrantz, 59 P.3d at 183.

[63]. In re Shaputis, 265 P.3d at 264–68.

[64]. Id. at 270–71.

[65]. Id.

[66]. Rebecca Vallas, Disabled Behind Bars: The Mass Incarceration of People with Disabilities in America’s Jails and Prisons, Ctr. for Am. Progress (July 18, 2016, 12:01 AM), https://www.americanprogress.org/issues/criminal-justice/reports/2016/07/18/141447/disabled-behind-bars.

[67]. Id.

[68]. Id.

[69]. Laura M. Maruschak, Medical Problems of Prisoners, Bureau of Just. Stat. (last revised Aug. 20, 2018), https://www.bjs.gov/content/pub/html/mpp/mpp.cfm.

[70]. See id.

[71]. See, e.g., Vallas, supra note 66.

[72]. See Petersilia, supra note 7, at 46.

[73]. See Cal. Dep’t of Corr., Clark v. California: Remedial Plan 1–2 (2002), https://www.cdcr.ca.gov/BOPH/docs/ADA-Resources/CLARK%20Remedial%20Plan.pdf.

[74]. Id.

[75]. Sentencing, Incarceration, & Parole of Offenders, supra note 10. See infra Section III.A.

[76]. See Clark v. California: Remedial Plan 1, supra note 73, at 2.

[77]. Id.

[78]. See Katie Riley et al., ADA Overview—Inmates with Disabilities 19 (2013), https://www.cdcr.ca.gov/BOPH/docs/Attorney_Orientation/PP%20-%20Inmates%20with
%20Disabilities%20-%206%20slides.pdf.

[79]. Id.

[80]. 42 U.S.C. § 12101–12213 (2012).

[81]. Id. § 12131 (defining “public entity” as “any department, agency, special purpose district, or other instrumentality of a State or States or local government” and thus reaching states’ correctional facilities).

[82]. Resources for Persons with Disabilities, Cal. Bd. of Parole Hearings, http://www.cdcr.ca.gov/BOPH/Attorney_Resources/ADA_Resources.html (last visited Aug. 20, 2018).

[83]. Id.

[84]. See id.

[85]. Armstrong v. Wilson, 942 F. Supp. 1252, 1258 (N.D. Cal. 1996), aff’d, 124 F.3d 1019, 1021 (9th Cir. 1997).

[86]. Armstrong v. Schwarzenegger, 622 F.3d 1058, 1063 (9th Cir. 2010). This case began when Schwarzenegger’s predecessor was in office, Governor Davis, and has continued since Schwarzenegger left office, under Governor Brown.

[87]. Clark v. California, 739 F. Supp. 2d 1168, 1173 (N.D. Cal. 2010).

[88]. See infra Sections II.C.1–3

[89]. Wilson, 942 F. Supp. at 1258.

[90]. Title II of the Americans with Disabilities Act, 42 U.S.C. § 12132 (2012) (emphasis added).

[91]. See Wilson, 942 F. Supp. at 1258.

[92]. Pennsylvania Dep’t of Corr. v. Yeskey, 524 U.S. 206, 213 (1998).

[93]. In July 2005, the Board of Parole Hearings (“BPH”) replaced the Board of Prison Terms (“BPT”) as the agency responsible for determining whether and when lifers are released on parole. See S.B. 737 (Cal. 2005) (enacted) (adding California Government Code section 12838.4, eliminating the Board of Prison Terms, and creating the Board of Parole Hearings, which are now under the umbrella of the CDCR).

[94]. See Armstrong v. Schwarzenegger, 622 F.3d 1058, 1062 (9th Cir. 2010) (“More than a decade and a half ago, disabled prisoners and parolees brought this action against the California officials with responsibility over the corrections system and parole proceedings.”); Armstrong v. Davis, 275 F.3d 849, 854–55 (9th Cir. 2001). See also Case Profile: Armstrong v. Schwarzenegger, C.R. Litig. Clearinghouse, http://www.clearinghouse.net/detail.php?id=572.

[95]. Case Profile: Armstrong v. Schwarzenegger, supra note 94.

[96]. Armstrong v. Wilson, 942 F. Supp. 1252, 1258–59 (N.D. Cal. 1996).

[97]. Case Profile: Armstrong v. Schwarzenegger, supra note 94.

[98]. Id.

[99]. Id.

[100]. See id. See also Stipulation and Order on Revised Injunction, Armstrong v. Davis, 275 F.3d 849 (9th Cir. 2001), enforced sub nom. Armstrong v. Schwarzenegger, 622 F.3d 1058 (9th Cir. 2010).

[101]. Case Profile: Armstrong v. Schwarzenegger, supra note 94.

[102]. Id.

[103]. See Clark v. State, No. C96-1486-FMS, 1996 U.S. Dist. LEXIS 21630, at *2–5 (N.D. Cal. Oct. 1, 1996), aff’d, 123 F.3d 1267 (9th Cir. 1997). See also Case Profile: Clark v. Wilson, C.R. Litig. Clearinghouse, https://www.clearinghouse.net/detail.php?id=576.

[104]. Case Profile: Clark v. Wilson, supra note 103.

[105]. Sentencing, Incarceration, & Parole of Offenders, supra note 10.

[106]. Case Profile: Clark v. Wilson, supra note 103.

[107]. Id.

[108]. See Clark v. California, 739 F. Supp. 2d 1168, 1174 (N.D. Cal. 2010).

[109]. See id. at 1173.

[110]. Cal. Penal Code § 3041(b)(1) (West 2018).

[111]. See supra Part I.

[112]. Procedural due process requires a fair process which typically includes an unbiased decision-maker and notice of the government’s actions before a person may be deprived of their life, liberty or property. See, e.g., Fuentes v. Shevin, 407 U.S. 67, 80–81 (1972). See also U.S. Const. amends. V, XIV. If an individual, due to cognitive impairments, is incapable of conforming to parole board standards, the hearing itself does nothing to ensure that due process is being afforded. Inmates remain incarcerated solely as a result of their disability.

[113]. Petersilia, supra note 7, at 46.

[114]. Id. at 29.

[115]. Id.

[116]. The parole board has always been tasked with ascertaining an inmate’s potential current danger on an individualized basis. “In determining whether or not an inmate is suitable or unsuitable for parole, ‘[t]he relevant determination for the Board . . . is, and always has been, an individualized assessment of the continuing danger and risk to public safety posed by the inmate.’” In re Lewis, 91 Cal. Rptr. 3d 72, 82–83 (Ct. App. 2009) (quoting In re Lawrence, 190 P.3d 535, 564 (Cal. 2008)). However, the individualized assessment is simply concerned with the inmate’s current danger and not their cognitive-ability level which could impact how they are able to demonstrate their rehabilitation.

[117]. Forensic Assessment Division, Cal. Bd. of Parole Hearings, http://www.cdcr.ca.gov
/BOPH/fad.html (last visited Aug. 20, 2018).

[118]. Id.

[119]. Id.

[120]. Board of Parole Hearings’ Revised Final Statement of Reasons 15 CCR § 2240, Cal. Bd. of Parole Hearings 23 (2012), https://www.cdcr.ca.gov/boph/docs/revised_final_statement
_reasons_original.pdf [hereinafter Final Statement of Reasons].

[121]. Cal. Code Regs. Tit. 15 § 2240(b) (West 2018).

[122]. See Cal. Pen, Code § 3041(b)(1) (West 2018). The higher the risk assessment score the better able the Board is to find that “consideration of the public safety requires a lengthier period of incarceration for this individual.” Id.

[123]. Final Statement of Reasons, supra note 120, at 4.

[124]. Id. at 4.

[125]. Id. at 26.

[126]. See, e.g., Cal. Code Regs. tit. 15 § 3270 (West 2018).

[127]. Id. § 3312 (a)(2)–(3).

[128]. Id. § 3314.

[129]. Id.

[130]. Id.

[131]. Weisberg et al., supra note 38, at 5.

[132]. Cal. Code Regs. tit. 15 §§ 2281 (c)(5)-(6). (West 2018).

[133]. Id.

[134]. Cal. Code Regs. tit. 15 § 3317.1 (West 2018).

[135]. Id.

[136]. Id.

[137]. Facts About Developmental Disabilities, Ctrs. for Disease Control & Prevention, https://www.cdc.gov/ncbddd/developmentaldisabilities/facts.html#ref (last visited Aug. 20, 2018).

[138]. Cal. Pen. Code § 3043 (West 2018).

[139]. About the Narcotics Anonymous (NA) 12-Step Recovery Program, Recovery.org (Aug. 13, 2018), https://www.recovery.org/topics/about-the-narcotics-anonymous-na-12-step-recovery-program.

[140]. Insight, Merriam-Webster Dictionary (11th ed. 2016).

[141]. Insight, Oxford Dictionary (3d ed. 2011).

[142]. See In re Lawrence, 190 P.3d 535, 541, 563 (Cal. 2008). See also In re Shaputis, 190 P.3d 573, 584–85 (Cal. 2008).

[143]. Wattley, supra note 18, at 273.

[144]. Shaputis, 190 P.3d at 584. See Wattley, supra note 18, at 273. When parole is denied, there are typically multiple reasons cited. “Within 20 days following any decision denying parole, the board shall send the inmate a written statement setting forth the reason or reasons for denying parole, and suggest activities in which he or she might participate that will benefit him or her while he or she is incarcerated.” Cal. Pen. Code § 3041.5 (b)(2) (West 2018).

[145]. In re Ryner, 126 Cal. Rptr. 3d 380, 392 (Ct. App. 2011). See In re Rodriguez, 122 Cal. Rptr. 3d 691, 699–700 (Ct. App. 2011).

[146]. In re Rosenkrantz, 59 P.3d 174, 182–83 (Cal. 2002).

[147]. Shaputis, 44 P.3d at 584–85 n.18.

[148]. Id. See also Rodriguez, 122 Cal. Rptr. at 702–03; In re Twinn, 118 Cal. Rptr. 3d 399, 417–18 (Ct. App. 2010).

[149]. Ryner, 126 Cal. Rptr. 3d at 391.

[150]. Id. at 390. See also In re Shippman, 110 Cal. Rptr. 326, 354 (Ct. App. 2010) (Pollack, J., dissenting).

[151]. Ryner, 126 Cal. Rptr. 3d at 392.

[152]. Id.

[153]. In re Denham, 150 Cal. Rptr. 3d 177, 187–88 (Ct. App. 2012).

[154]. Id. at 188.

[155]. Id.

[156]. In re Twinn, 118 Cal. Rptr. 3d 399, 415 (Ct. App. 2010).

[157]. Id. at 402–03.

[158]. Id. at 414.

[159]. Id. at 417–18.

[160]. See, e.g., In re Ryner 126 Cal. Rptr. 3d 380, 390 (Ct. App. 2011).

[161]. In re Rosenkrantz, 59 P.3d 174, 183–84 (Cal. 2002).

[162]. Cal. Code Regs. tit. 15 § 2402 (West 2018).

[163]. Wattley, supra note 18, at 273.

[164]. See In re Powell, 755 P.2d 881, 885–86 (Cal. 1988).

[165]. Id.

[166]. Id.

[167]. Alice Medalia & Hadine Revheim, Dealing with Cognitive Dysfunction Associated with Psychiatric Disabilities, N.Y. Off. of Mental Health, https://www.omh.ny.gov/omhweb/cogdys
_manual/cogdyshndbk.htm (last visited Aug. 20, 2018).

[168]. Petersilia, supra note 7, at 61.

[169]. Ctrs. for Disease Control & Prevention, supra note 137.

[170]. See supra Section III.B.

[171]. See, e.g., Riley et al., supra note 78, at 19.

[172]. Id. at 23.

[173]. Id.

[174]. Id.

[175]. See generally In re Shaputis, 190 P.3d 573 (Cal. 2011); In re Lawrence, 190 P.3d 535 (Cal. 2008).

[176]. See, e.g., Ctrs. for Disease Control & Prevention, supra note 137 (“Developmental disabilities are a group of conditions due to an impairment in physical, learning, language, or behavior areas.”).

[177]. Riley et al., supra note 78, at 23.

[178]. Id. A TABE score reflects grade level skills achievement. A TABE score of under 4.0 would indicate an individual is performing below a fourth-grade level in the tested subject.

[179]. Id.

[180]. Id. at 25.

[181]. Adult Basic Education (ABE) I, II, and III, Cal. Dep’t of Corr. & Rehab., http://www.cdcr.ca.gov/rehabilitation/ABE.html (last visited Aug. 20, 2018).

[182]. TABE Test, Study Guide Zone, https://www.studyguidezone.com/tabetest.htm (last visited Aug. 20, 2018).

[183]. Id.

[184]. Adult Basic Education (ABE) I, II, and III, supra note 181.

[185]. Cal. Pen. Code § 2053.1 (West 2018).

[186]. See generally Model Rules of Prof’l Conduct r. 1.3 (Am. Bar. Ass’n 2016).

[187]. 3 Witkin, Cal. Crim. L, & Punishment § 731 (4th ed. 2012). See also In re Lugo, 80 Cal. Rptr. 3d 521, 533 (Ct. App. 2008) (“By its nature, the determination whether a prisoner should be released on parole is generally regarded as an executive branch decision. The decision, and the discretion implicit in it, are expressly committed to the executive branch.”).

[188]. Witkin, supra note 187.

[189]. Wattley, supra note 18, at 271. See also Swarthout v. Cooke, 562 U.S. 216, 219–20 (2011); Bd. of Pardons v. Allen, 482 U.S. 369, 373–81 (1987).

[190]. See Clark v. California: Remedial Plan 1, supra note 73, at 1–2.

[191]. Cal. Penal Code § 5075.6(b)(1) (West 2018).

[192]. Petersilia, supra note 7, at 61.

[193]. Id.

[194]. Id.

[195]. Id.

[196]. See Wattley, supra note 18, at 273.

[197]. Petersilia, supra note 7, at 29.

INTRODUCTION

I. BACKGROUND

A. Contract Common Law: Offer and Acceptance

B. From Shrinkwrap to Clickwrap

1. Step-Saver and ProCD

2. Online Contracts Today

C. Second and Ninth Circuit Decisions: Nguyen, Berman, and Specht

II. CASE LAW SURVEY

A. California State Courts

1. Clickwrap Agreements

2. Browsewrap Agreements

3. Sign-In-Wrap Agreements

B. U.S. District Courts in California

1. Clickwrap Agreements

2. Scrollwrap Agreements

3. Browsewrap Agreements

4. Sign-In-Wrap Agreements

C. Summary of Findings

1. Standards of Notice

2. The Erosion of Distinct Wrap Categories

3. The Relevance of Step-Saver and ProCD

CONCLUSION

APPENDIX A. Surveyed Cases in California State Courts

APPENDIX B. Surveyed Cases in U.S. District Courts in California

98 S. Cal. L. Rev. 419

INTRODUCTION

I. HISTORY OF THE ENTERTAINMENT INDUSTRY

A. The Economics of the 1930s Studio System

B. Modern Talent Contracts

1. Film

2. Series and Short Form (Television)

3. Option Contracts

4. Pay or Play

C. Industry Practices

II. SECTION 16600 AND EDWARDS

A. Section 16600

B. Edwards v. Arthur Andersen

III. CASE ANALYSIS

A. Exclusivity Analyzed Through the Lens of Section 16600

B. Section 16600 Application to In-Term Provisions

C. Section 16600 Application to Post-Term Noncompete Provisions

D. Factors Unique to the Entertainment Industry

IV. SUMMARY OF CASE ANALYSIS

CONCLUSION

97 S. Cal. L. Rev. 1087

INTRODUCTION

I. MODERN LAW OF JUDICIAL PEREMPTORY DISQUALIFICATION

A. Federal Law

B. California Law

1. California Code of Civil Procedure Section 170.6

2. Judicial Rules

3. Comparison to Peremptory Juror Challenges

C. Comparison Between California Law and Other States’ Law

II. THE POLICY TRADE-OFFS

A. Public Confidence in the Judiciary

B. Abuse of the Challenge

C. Intimidation of Judges

D. Discrimination Against Judges

III. EMPIRICAL FINDINGS IN CALIFORNIA

A. Research Methodology

B. Preliminary Empirical Data

IV. ALTERNATIVES TO CALIFORNIA’S JUDICIAL PEREMPTORY CHALLENGE

A. Existing Alternative Procedures

1. The Panel-Exclusion Approach

2. The Interlocutory Appeal Approach

3. The Independent Judge Approach

B. The Proposed Alternative Procedure

V. RECOMMENDATIONS FOR FUTURE RESEARCH

CONCLUSION

97 S. Cal. L. Rev. 253

INTRODUCTION

I. BACKGROUND

A. The Clean Air Act and EPA Waiver Provision

B. History of California’s Motor Vehicle Regulations and Waiver Requests

C. Pending Lawsuit—Ohio v. EPA

D. California’s Advanced Clean Cars II Regulations

E. The Equal Sovereignty Principle

1. Origins: The Equal Footing Doctrine—New Admission of States

2. Equal Sovereignty Applied to Voting Rights

3. Shelby County v. Holder—Equal Sovereignty as a General Principle

From Volume 91, Number 5 (July 2018)
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