A California court of appeal ruled in Marenco v. DirecTV, LLC that DirecTV could enforce an arbitration agreement between a company it purchased and the company’s employee, even though it was not a party to the arbitration agreement.

In Marenco, DirecTV purchased 180 Connect and continued to employ 180 Connect’s employees, including Francisco Marenco, who had previously executed a mandatory binding arbitration agreement with 180 Connect. Marenco subsequently left DirecTV and sued DirecTV for issuing wage payments through debit cards that required activation fees and cash withdrawal fees, allegedly in violation of California law. DirecTV moved to compel arbitration based on the arbitration agreement that Marenco executed with 180 Connect.

The court determined that Marenco was required to arbitrate his claim with DirecTV, finding that “Marenco’s continued employment with DirecTV [following the acquisition] served as his implied consent to preserving the original terms of his employment, including the arbitration agreement.”