California Assembly Bill 51 (“AB 51”) prohibits employers from requiring mandatory arbitration agreements as a condition of employment, continued employment, or receipt of employment-related benefits for claims arising under California’s Labor Code or California’s Fair Employment Housing Act, and provides for civil and criminal sanctions for violation of AB 51. The Ninth Circuit partially vacated a lower court’s injunction against enforcement of the bill, holding that the ban on mandatory employment arbitration agreements is not preempted by the Federal Arbitration Act (“FAA”) because the ban only implicates pre-agreement employer conduct. The Ninth Circuit upheld the injunction imposed by the lower court to the extent that it enjoined California from enforcing violations of AB 51 with criminal or civil sanctions with respect to executed arbitration agreements, reasoning that the FAA does preempt state laws intended to regulate post-agreement employer behavior. Plaintiffs are likely to seek en banc review of the opinion in the Ninth Circuit, as well as review in the U.S. Supreme Court, in light of the fact that the opinion conflicts with two sister circuit courts and takes a narrow view of recent Supreme Court precedent favoring arbitration.