Ferguson v. Corinthian Colleges, Inc. (Ninth Circuit)

Former students at for-profit colleges brought a putative class action against the colleges, claiming that they were misled into enrolling and taking out student loans (which they could not repay) by assurances about their job prospects after completing their studies. The colleges moved to compel the students to arbitrate their claims individually under arbitration clauses in their enrollment agreements. The district court denied the motion, however, applying California’s Broughton–Cruz rule, which provided that arbitration could not be required for claims for “public injunctions” under certain state consumer-protection laws, and the colleges appealed. We filed an amicus brief on behalf of the Chamber of Commerce of the United States, arguing that the Federal Arbitration Act preempts California’s Broughton–Cruz rule and that the arbitration agreements should therefore be enforced. The U.S. Court of Appeals for the Ninth Circuit agreed, reversing and remanding to require arbitration.