Petitioner anesthesiologists sued real party in interest defendants, a hospital and the anesthesiologists’ medical group, alleging several causes of action, including age and national origin discrimination. Respondent, the Los Angeles County Superior Court, California, granted defendants’ petition to compel arbitration. The anesthesiologists filed a petition for a writ of mandate, seeking review of the trial court’s order compelling arbitration.
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The medical group had entered into two anesthesiology contracts with the hospital. The court concluded that the anesthesiologists did not agree to arbitrate disputes relating to one of the contracts and that the terms of the arbitration clause in the other contract were, because of applicable rules limiting damage remedies, unconscionable, rendering the agreement to arbitrate unenforceable. A 2008 contract provided no basis for compelling arbitration because the anesthesiologists were shareholders of a corporation, and the agreement was not signed by them individually or on behalf of the corporation. Although the anesthesiologists were bound by a 2006 contract, that contract was procedurally and substantively unconscionable. The 2006 contract provided for arbitration in accordance with certain rules that severely limited damages remedies, and these rules could not be severed from the arbitration clause. These limitations were significant elements of the contract. By limiting the arbitrator’s power to provide various remedies, the anesthesiologists could be left with the possibility of having to seek relief for the excluded remedies in a separate judicial proceeding.
The petition for writ of mandate was granted. The trial court was ordered to set aside its order compelling arbitration and deny defendants’ petition to compel arbitration.
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