Kolev

Opinion by Judge REINHARDT; Dissent by Judge N.R. SMITH.

OPINION

Diana Kolev brought suit against Euro-motors West/The Auto Gallery, Motorcars West LLC, HM Gray Family II Inc., Gray Family II LLC, Bennett Automotive I Inc., Bennett Automotive II Inc. (“the Dealership”) and Porsche Cars North America, Inc. (“Porsche”), when the preowned (formerly known as “used”) automobile that she purchased from the Dealership developed serious mechanical problems during the warranty period and the Dealership refused to honor her warranty claims. She alleges breach of implied' and express warranties under the MagnusonMoss Warranty Act (“MMWA”), and breach of contract and unconseionability under California law.

The district court granted the Dealership’s petition to compel arbitration pursuant to the mandatory arbitration provision in the sales contract that Kolev signed when she bought the car. It also stayed the action against Porsche. After the arbitrator resolved most of the claims in favor of the Dealership, the district court confirmed the arbitration award. We review de novo the district court’s order granting the petition to compel arbitration. See Davis v. O’Melveny & Myers, 485 F.3d…

dissenting.

In a departure from Supreme Court precedent, the prevailing view of our sister circuits, and applicable statutes, the majority opinion nullifies nearly every binding, non-judicial warranty dispute remedy adopted by private parties in this circuit. The majority reaches this conclusion by conflating “informal dispute settlement procedures” (“IDSMs” or “Mechanisms”) 1 *1032 under the Magnuson-Moss Warranty Act, 15 U.S.C. § 2301 et seq. (“MMWA”) — a narrow class of warranty dispute resolution procedures — with any ADR remedy adopted in a private contract.

Here, we address whether FTC regulations (proscribing the use of binding arbitration by “Mechanisms ”) bar the use of a binding arbitration remedy to which Kolev and a Los Angeles Porsche dealership agreed. Neither party contends that the dealership’s arbitration remedy is a Mechanism. Indeed, the arbitration remedy (chosen by the parties) is not, and has never purported to be, compliant with federal law regulating the creation and operation of Mechanisms. More importantly, the FTC acknowledges that private parties may agree to pursue “some avenue of redress other than the Mechanism if they feel it is more appropriate,”…

Martin W. Anderson and Jeffrey Kane, Santa Ana, CA, for the plaintiff-appellant.

Arent Fox, Aaron H. Jacoby, John D. Bronstein, and Melanie S. Joo, Los Angeles, CA, for the defendants-appellees.

Before: D.W. NELSON, STEPHEN REINHARDT, and N. RANDY SMITH, Circuit Judges.

Opinion by Judge REINHARDT; Dissent by Judge N.R. SMITH.

REINHARDT, Circuit Judge:

Diana Kolev brought suit against Euromotors West/The Auto Gallery, Motorcars West LLC, HM Gray Family II Inc., Gray Family II LLC, Bennett Automotive I Inc., Bennett Automotive II Inc. ("the Dealership") and Porsche Cars North America, Inc. ("Porsche"), when the pre-owned (formerly known as "used") automobile that she purchased from the Dealership developed serious mechanical problems during the warranty period and the Dealership refused to honor her warranty claims. She alleges breach of implied and express warranties under the Magnuson-Moss Warranty Act ("MMWA"), and breach of contract and unconscionability under California law.

The district court granted the Dealership's petition to compel arbitration pursuant to the mandatory arbitration provision in the sales contract that Kolev signed when she bought the car. It also…