Lemon Law Cases Are Rising — The American Arbitration Association Is Ready to Help

By Malisa "Lise" Prisarojn

California’s automotive Lemon Law landscape is evolving quickly. As the number of claims filed under the Song-Beverly Consumer Warranty Act—commonly known as California’s Lemon Law—continues to climb, a new legal framework is taking shape. With the enactment of Assembly Bill 1755 and the implementation of California Code of Civil Procedure § 871.26, effective April 1, 2025, claimants must now engage in mandatory mediation.

This shift is meant to reduce litigation backlogs and encourage early, efficient resolution of disputes, but it will require a robust infrastructure to manage and mediate these claims effectively. That’s where the American Arbitration Association^® (AAA^®) comes in.

The passage of AB 1755 reflects a growing recognition that courtrooms aren’t always the best place for consumers and manufacturers to resolve Lemon Law disputes. Under the new statute, mediation must occur within 150 days after the defendant files an answer or other responsive pleading. This change is formalized under California Code of Civil Procedure § 871.26, which outlines specific steps and timelines for initiating mediation.

In short, mediation is a necessary step in any litigation where the customer files litigation seeking restitution or replacement of a motor vehicle under the Lemon Law. As the volume of Lemon Law cases rises, so does the need for experienced, impartial, and efficient dispute resolution services. The AAA has responded by offering a new set of Consumer Mediation Procedures, effective April 1, 2025, tailored to meet the needs of California Lemon Law claims, among other consumer disputes.

Here’s how the AAA is prepared to support consumers, manufacturers, and their legal representatives:

1. A Fast, Streamlined Process

The AAA’s Consumer mediation process has been purpose-built for speed and simplicity. Claimants can quickly initiate mediation by filling out a straightforward California Lemon Law Request for Mediation Form. Disputants can also review our new Consumer Mediation Procedures & Fee Schedule, keeping in mind that, under California Code of Civil Procedure § 871.26, the consumer and manufacturer split the costs for mediation equally. 

2. Expert Neutrals with Lemon Law Experience

Mediating a Lemon Law claim requires more than just legal knowledge—it demands specialized experience in automotive warranty issues and the practical realities of vehicle repair, valuation, and replacement. The AAA has built a panel of vetted mediators with exactly that expertise.

These seasoned professionals bring credibility, impartiality, and a deep understanding of the nuances involved in Lemon Law disputes. Their guidance helps parties find common ground and reach resolution efficiently—potentially avoiding the time, cost, and stress of litigation altogether.

3. Capacity to Handle High-Volume Caseloads

With decades of experience administering large-scale mediation programs, the AAA is well-equipped to handle the expected surge in Lemon Law mediations. Whether it's ten cases or ten thousand, the AAA is ready to respond with:

• Administrative efficiency
• Consistent case handling
• Dedicated case managers
• Robust infrastructure and digital tools

The AAA’s ability to scale while maintaining fairness and professionalism makes it a trusted partner in meeting the needs of both consumers and manufacturers during this transition.

For consumers, this new law adds a step—one that could work in their favor. Mediation can lead to a faster resolution and help avoid costly legal fees. It also offers a confidential, non-adversarial space to have their concerns heard and addressed.

For legal counsel and manufacturers, the need for a reliable, experienced mediation provider has never been greater. Working with the AAA means that every case is handled according to industry best practices and that the process is fair, efficient, and in-line with the new law.

To learn more about the AAA’s Consumer Division, including access to forms, or to begin the mediation process, visit: www.adr.org/consumer.  If you have questions or need assistance, you can contact a mediation administrative specialist at mediationservices@adr.org.