DIRECTV, Inc. v. Imburgia, 577 U.S. 47

DIRECTV contracts with customers include an arbitration clause and a class-arbitration waiver, stated to be unenforceable if the law of the customer's state makes the waiver unenforceable.
The contract designates the Federal Arbitration Act as governing the arbitration provision.
California law at the time—Discover Bank—rendered class-arbitration waivers in consumer contracts unenforceable; California courts had applied that rule to void the clause here.
After Concepcion, the FAA preempts California Discover Bank rule, prompting DIRECTV to seek arbitration and California courts to deny enforcement of the arbitration clause.
The California Court of Appeal held that the phrase “law of your state” referred to California law as it would have been without preemption, thereby voiding the entire arbitration provision.
The Supreme Court reversed, holding that the California court’s interpretation is pre-empted by the FAA and that the arbitration agreement must be enforced.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the FAA preempts California’s interpretation of 'law of your state'.	Imburgia: state-law interpretation should apply, making the waiver unenforceable.	DIRECTV: FAA pre-empts California rule; 'law of your state' should be read in light of federal preemption.	FAA pre-empts the California court; enforce arbitration.
Does 'law of your state' refer to California law as it would be without preemption or to state law including preemption effects?	California would render waiver unenforceable; clause void.	Parties may choose law subject to FAA preemption; California rule does not control.	Read as state law without considering preemption; preemption requires enforcement of arbitration.

AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (FAA preempts California Discover Bank rule)
Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006) (arbitration contracts not on equal footing with all contracts)
Discover Bank v. Superior Court, 36 Cal. 4th 148 (2005) (California rule invalidating class-action waivers in consumer contracts)
Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior Univ., 489 U.S. 468 (1989) (contract interpretation governs arbitration formation under state law)
Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52 (1995) (contract language construed against the drafter when ambiguous)
Rivers v. Roadway Express, Inc., 511 U.S. 298 (1994) (arbitration construction and retroactive contract principles)
Perry v. Thomas, 482 U.S. 483 (1987) (FAA preemption and contract terms in arbitration)
First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (state-law contract interpretation applies to arbitration agreements)