Judge: Christopher K. Lui, Case: 24STCV23032, Date: 2025-01-22 Tentative Ruling
Case Number: 24STCV23032 Hearing Date: January 22, 2025 Dept: 76
The following
tentative ruling is issued pursuant to Rule of Court 3.1308 at 2:57 PM on January 21,
2025.
Notice of intent
to appear is REQUIRED pursuant to California Rule of Court 3.1308(a)(1). The Court does not desire oral argument on
the motion addressed herein.
As required by
Rule 3.1308(a)(1), any party seeking oral argument must notify ALL OTHER
PARTIES and the staff of Department 76 by 4:00 p.m. on January 21,
2025.
Notice to
Department 76 may be sent by email to smcdept76@lacourt.org or telephonically
at 213-830-0776.
Per Rule of Court
3.1308, the Court may not entertain oral argument if notice of intention to
appear is not given.
Plaintiff alleges that Defendant Tinder, LLC unfairly prohibits people with a criminal history from using its services.
Defendant Tinder LLC moves to compel arbitration and stay this action.
TENTATIVE RULING
Defendant Tinder LLC’s motion to compel arbitration and stay this action pending arbitration is GRANTED.
ANALYSIS
Motion To Compel Arbitration and Stay Action
Discussion
Defendant Tinder LLC moves to compel arbitration and stay this action.
Existence of Agreement To Arbitrate
Under California law, arbitration agreements are valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. (Blake v. Ecker (2001) 93 Cal.App.4th 728, 741 overruled on other grounds by Le Francois v. Goel (2005) 35 Cal.4th 1094.) A party petitioning to compel arbitration has the burden of establishing the existence of a valid agreement to arbitrate and the party opposing the petition has the burden of proving, by a preponderance of the evidence, any fact necessary to its defense. (Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal.App.4th 348, 356-57.)
Because the parties argue the applicability of California and Texas law, the Court will address the approach to online agreements under both states’ laws.
Although the parties delegated questions of the scope and enforceability of the Dispute Resolution Section to an arbitrator, it is still for the court to decide the threshold question whether the parties had entered into an agreement to arbitrate. (Mendoza v. Trans Valley Transp. (2022) 75 Cal.App.5th 748, 772.)
Evidence of the applicable arbitration agreement is set forth in the Declaration of Jennifer Flashman as follows:
8. When Tinder
LLC released its February 28, 2022 TOU, a pop-up blocking modal screen was presented
to all active users requiring them to agree to the updated version of the TOU before
being able to continue using the Tinder service. When a user attempted to access
Tinder after February 28, 2022, the user would encounter the pop-up blocking modal.
The user could not continue to use the app without agreeing to the TOU by tapping
a button saying “Agree.” The pop-up blocking modal contained a bold, underlined,
and colored hyperlink to the “Terms” immediately above the “Agree” button. If a
user left the app without tapping the required button, the blocking modal would
appear again when the user attempted to access the app again. Tinder LLC’s records
confirm that Plaintiff was shown the blocking modal and selected “Agree” on his
Android device on March 17, 2022. A true and correct copy of the pop-up blocking
modal is attached hereto as Exhibit 2.
The Tinder
blocking modal explained that “Tinder has changed its Terms. To use Tinder, you
must agree to the Terms, which contain updated dispute resolution provisions
in Section 15 that apply to any past, pending, and future dispute.” (Flashman Decl., Ex. 2 [bold emphasis added].)
The Terms of Use containing the arbitration clause is attached as Exh. 1 to the Flashman Declaration and contains the following language:
1. Acceptance of Terms of Use Agreement.
PLEASE CAREFULLY REVIEW THE DISPUTE
RESOLUTION PROVISIONS IN SECTION 15 BELOW. THESE GOVERN THE MANNER IN WHICH CLAIMS
WILL BE ADDRESSED BETWEEN YOU AND TINDER. THESE PROVISIONS INCLUDE A MANDATORY PRE-ARBITRATION
INFORMAL DISPUTE RESOLUTION PROCESS, AN ARBITRATION AGREEMENT, SMALL CLAIMS COURT
ELECTION, CLASS ACTION WAIVER, ADDITIONAL PROCEDURES FOR MASS ARBITRATION FILINGS,
AND JURY TRIAL WAIVER THAT AFFECT YOUR RIGHTS. IN ARBITRATION, THERE IS TYPICALLY
LESS DISCOVERY AND APPELLATE REVIEW THAT IN COURT.
15. Dispute Resolution Section
In the unlikely event that we have a legal dispute, here is how the Parties agreed to proceed, except where prohibited by applicable law.
Any Subsection in this Dispute Resolution Section that is prohibited by law shall not apply to the users residing in that jurisdiction.
15.a. INFORMATION DISPUTE RESOLUTION PROCESS
. . . If you choose to pursue a dispute, claim or controversy against Tinder, these terms will apply. For purposes of this Dispute Resolution Process and Arbitration Procedures set forth in Section 15, “Tinder” shall include our affiliates, employees, licensors, and service providers.
. . . Before formally pursuing a Dispute in arbitration or small claims court, you agree to first send a detailed notice (“Notice”) to Match Group Legal . . . If Tinder has a Dispute with you, Tinder agrees to first send a Notice to you at your most recent email address on file with us, or, if no email address is on file, other contact information associated with your account. Your Notice must contain all of the following information . . . You must personally sign this Notice for it to be effective. Tinder’s Notice must likewise set forth a detailed description of its Dispute, which shall include the nature and factual basis of its claim(s) and the relief it is seeking, with a corresponding calculation of our damages (if any). You and Tinder agree to then negotiate in good faith in an effort to resolve the Dispute. As part of these good faith negotiations, if Tinder requests a telephone conference with you to discuss your Dispute, you agreed to personally participate, with your attorney if you’re represented by counsel. Likewise, if you request a telephone conference to discuss Tinder’s Dispute with you, Tinder agrees to have on representative participate. This informal process should lead to a resolution of the Dispute. However, if the Dispute is not resolved within 60 days after receipt of a fully completed Notice and the Parties have not otherwise mutually agreed to an extension of this information dispute resolution time period, you or Tinder may initiate an arbitration (subject to a Party’s right to elect small claims court as provided below.)
Completion of this informal dispute resolution is a condition precedent to filing any demand for arbitration or small claims court action. Failure to do so is a breach of this Agreement. . . . Unless prohibited by applicable law, the arbitration provider, National Arbitration and Mediation (“NAM”), shall not accept or administer any demand for arbitration and shall administratively close any arbitration unless the Party bringing such demand for arbitration can certify in writing that the terms and conditions of this informal dispute resolution proceed were fully satisfied. A court of competent jurisdiction shall have authority to enforce this provision and to enjoin any arbitration proceeding or small claims court action.
. . .
15c. DISPUTE RESOLUTION THROUGH ARBITRATION OR SMALL CLAIMS COURT
Any dispute, claim or controversy between you and Tinder (that is not resolved information by Tinder Customer Servicer or as provided under subsection 15a above) that arises from or relates in any way to this Agreement (including any alleged breach of this Agreement), the Service, or our relationship with you (Collectively, “Dispute”), shall be exclusively resolved through BINDING INDIVIDUAL ARBITRATION except as specifically provided otherwise in this Dispute Resolution Section. “Dispute” as used in this Agreement shall have the broadest possible meaning and include claims that arose before the existence of this or any prior Agreement and claims that arise during the terms of this Agreement or after the termination of this Agreement. . . . All other issues (except as otherwise provided herein) are exclusively for the Arbitrator to decide, including but not limited to scope and enforceability of this Dispute Resolution Section, . . .
(Terms of Use, Flashman Decl., Exh. 1 [bold emphasis added].)
This “‘principle of knowing consent applies
with particular force to provisions for arbitration’ [citation], including arbitration
provisions contained in contracts purportedly formed over the internet.” (Sellers,
supra, 73 Cal.App.5th at p. 460.) In the context of an internet transaction,
“in the absence of actual notice, a manifestation of assent may be inferred from
the consumer’s actions on the website—including, for example, checking boxes and
clicking buttons—but any such action must indicate the parties’ assent to the same
thing, which occurs only when the website puts the consumer on constructive
notice of the contractual terms. [Citation.] Thus, in order to establish mutual
assent for the valid formation of an internet contract, a provider must first establish
the contractual terms were presented to the consumer in a manner that made it apparent
the consumer was assenting to those very terms when checking a box or clicking
on a button.” (Id. at p. 461, second italics added.) And “the full
context of any transaction is critical to determining whether any particular notice
is sufficient to put a consumer on inquiry notice of contractual terms contained
on a separate, hyperlinked page.” (Id. at p. 453.)
. . . [*1295] . . .
II.
. . .
[*1296]
Because Dexcom did not present evidence that plaintiffs had actual notice of the Terms of Use, it was required to establish contract formation on a constructive or inquiry notice theory. (Sellers, supra, 73 Cal.App.5th at p. 453; see Civ. Code, § 19 [defining constructive notice].) To succeed on this theory, Dexcom needed to show that it provided prospective G6 App users with reasonably conspicuous notice of the existence of the terms to which they were to be bound. Importantly here, it was required to show that the content of its “Legal” screen supports the inference that the user’s action on that screen—here, clicking the checkbox—constituted an unambiguous manifestation of assent to those terms, including the arbitration provision. (Citations omitted.)
(Herzog v. Superior Court (2024) 101 Cal.App.4th 1280, 1294-1307 [bold emphasis and underlining added].)
Here, the fact that the pop-up blocking modal screen expressly referenced “updated dispute resolution provisions in Section 15 that apply to any past, pending, and future dispute,” Plaintiff was given actual notice that he was agreeing to the arbitration provision in section 15 regarding disputes that he may have had before, and after February 28, 2022.
Under Texas law:
As would
be expected, the conspicuousness and binding nature of a website’s terms and conditions
has been the subject of extensive litigation nationwide. Website user agreements
generally have been separated into three categories: “clickwrap” agreements, “browsewrap”
[*12] agreements, and “sign-in-wrap” agreements.
See Phillips, 2019 U.S. Dist. LEXIS 171313, 2019 WL 4861435, at *3-4. The
user agreement in this case falls into the last category. A sign-in-wrap agreement
notifies the user of the existence of the website’s terms and conditions and advises
the user that he or she is agreeing to the terms when registering an account or
signing up. 2019 U.S. Dist. LEXIS 171313, [WL] at *4. Courts typically enforce
sign-in-wrap agreements when notice of the existence of the terms was “reasonably
conspicuous.” Id.
In determining whether the terms of a website agreement
are conspicuous, we consider the website from the perspective of a reasonably prudent
computer or smartphone user. See Meyer, 868 F.3d at 77. It is not
necessary that the agreement’s terms be on the same webpage through which the user
indicates his or her assent; it is enough that the page contains a conspicuous hyperlink.
See Fteja v. Facebook, 841 F.Supp.2d 829, 839 (S.D.N.Y. 2012). Here, the
submittal page was uncluttered, with only a few spaces to enter information, and
a large orange submit button with the phrase “By submitting this request, you are
agreeing to our Terms & Conditions” written directly underneath. The text with
the hyperlink to the terms and conditions is dark against a bright white background,
clearly legible, and the same size as the nearly all of the [*13] text on the screen. The entire screen is visible
at once with no scrolling necessary. The hyperlink may be clicked, and the terms
of the agreement may be viewed, before the user submits a request for service. Although
the terms of service are lengthy, the arbitration provision is prominently noted
with bolded and capitalized print. There is nothing misleading or confusing about
HomeAdvisor’s presentation of its user agreement. Similar presentations have consistently
been found to be conspicuous and to put the website user on inquiry/constructive
notice of the website’s terms of service. See id.; Meyer, 868 F.3d at
79; Phillips. 2019 U.S. Dist. LEXIS 171313, 2019 WL 4861435, at *5. Indeed,
more cluttered and complicated sign-in-wrap screens have been found to provide sufficient
notice. See May v. Expedia, Inc., No. A-16-CV-1211-RP, 2018 U.S. Dist. LEXIS
167118, 2018 WL 4343445, at *3 (W.D. Tex. 2018). Accordingly, we conclude HomeAdvisor’s
submittal screen gave appellees reasonably conspicuous notice of the company’s terms
of service, including the arbitration provision.
We further
conclude that appellees’ assent to HomeAdvisor’s terms of service was unambiguous
as a matter of law. The mechanism for manifesting assent - clicking the submit button
- is temporally coupled with the website user’s receipt of the company’s services
and the user [*14] is clearly advised that
clicking the submit button indicates such assent. In other words, the reasonably
prudent user would have understood that they could only receive HomeAdvisor’s referral
services by agreeing to the company’s terms and conditions. See Meyer,
868 F.3d at 79-80. Based on the foregoing, we conclude an agreement to arbitrate
exists between HomeAdvisor and appellees.
Appellees
contend that, even if an agreement to arbitrate exists, the agreement as a whole
is unenforceable because it is unconscionable. We note that challenges to the validity of the contract as
a whole, and not specifically to the arbitration clause, must go to the arbitrator.
Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 449, 126 S. Ct. 1204,
163 L. Ed. 2d 1038 (2006). But even if appellees’ contentions could be read as a
challenge to the arbitration provision, all issues of arbitrability, including
defenses to arbitration such as unconscionability, were delegated to the arbitrator
for determination under the terms of the agreement.
It
is well settled that parties can agree to arbitrate “gateway” questions of arbitrabilty
such as unconscionability. See Rent-A-Ctr., W., Inc. v. Jackson, 561
U.S. 63, 68-69, 130 S. Ct. 2772, 177 L. Ed. 2d 403 (2010); Arnold, 890 F.3d
at 552; Dow Roofing Sys., LLC v. Great Comm’n Baptist Church, No. 02-16-395-CV,
2017 Tex. App. LEXIS 7370, 2017 WL 3298264, at *3 (Tex. App.—Fort Worth Aug. 3,
2017, pet. denied) (mem. op.) Where the parties’ contract clearly and unmistakably
delegates the arbitrability question to the arbitrator, [*15] the court possesses no power to decide the arbitrability
issue. Robinson v. Home Owners Mgmt. Enters., Inc., 590 S.W.3d
518, 532 (Tex. 2019).
In this
case, the arbitration provision clearly, and in bold print, informed the website
user that, by using HomeAdvisor’s services, the user was giving up their right to
go to court and their rights would be determined by a neutral arbitrator rather
than a judge or jury. HomeAdvisor’s arbitration procedures specified that any arbitration
would be administered by the AAA and governed by the AAA’s Commercial Arbitration
Rules. The AAA rules expressly delegate the issue of arbitrability to the arbitrator.
This Court and many others have held that
a bilateral agreement to arbitrate under the AAA rules constitutes clear
and unmistakable evidence of the parties’ intent to delegate the issue of arbitrability
to the arbitrator. Arnold, 890 F.3d at 553; Saxa Inc. v. DFD Architecture
Inc., 312 S.W.3d 224, 229-30 (Tex. App.—Dallas 2010, pet. denied). Appellees
have made no assertion, and present no argument, that the delegation of arbitrability
to the arbitrator is itself unconscionable.
Based
on the foregoing, we conclude HomeAdvisor established the existence of an arbitration
agreement between it and appellees. HomeAdvisor further established that all defenses
to arbitration, including unconscionability and the validity of the arbitration
provision, [*16] were delegated to the arbitrator.
Accordingly the trial court erred in denying HomeAdvisor’s motion to compel
arbitration. We resolve HomeAdvisor’s first issue in its favor. Because of our resolution
of this issue, it is unnecessary for us to address the remaining issues.
We reverse
the trial court’s order denying HomeAdvisor’s motion to compel arbitration and remand
the cause with instructions to order the parties to arbitration and stay the underlying
case pending the outcome of the arbitration.
(HomeAdvisor, Inc. v. Waddell (2020) 2020 Tex. App. LEXIS 4226, *11-16 [bold emphasis added].)
Thus, under Texas law, a reasonably prudent user would have understood they could only user Tinder’s app is they agreed to the arbitration terms. Moreover, Texas law also permits delegation of questions to arbitrators.
In opposition,
Plaintiff argues that Defendant did not manifest its intent to allow felons including
Plaintiff to create an account or use the services because The Terms of Use clearly
state that “You are not authorized to create an account or use the Services unless
all of the following are true, and by using our Services, you represent and warrant
that.. You have not… been convicted of… a felony[.]”
Plaintiff also argues that there is no consideration because Defendant does not provide services to felons. Plaintiff argues that the fact that Plaintiff ended up using Defendant’s services anyway does not magically turn the use into a legally binding contract.
However, there was consideration of Tinder agreeing to confer the benefit of allowing Plaintiff to use the Tinder app and services in exchange for Plaintiff agreeing to be bound by the terms of use. What happened thereafter does not negate the existence of consideration.
Consideration
is an essential element of a contract. (See § 1550.) Section 1605 defines “good
consideration” as “[a]ny benefit conferred, or agreed to be conferred, upon the
promisor … or any prejudice suffered, or agreed to be suffered, by [the promisee]
… as an inducement to the promisor … .” “It is not enough, however, to confer a
benefit or suffer prejudice for there to be consideration. … [T]he benefit or prejudice
‘“must actually be bargained for as the exchange for the promise.”‘” (Steiner
v. Thexton (2010) 48 Cal.4th 411, 421 [106 Cal. Rptr. 3d 252, 226 P.3d 359];
see Jara v. Suprema Meats, Inc. (2004) 121 Cal.App.4th 1238, 1248 [18 Cal.
Rptr. 3d 187] (Jara) [“the Supreme Court [has] authoritatively adopted the
concept of consideration as a bargained-for exchange”].)
(Orcilla v. Big Sur, Inc. (2016) 244 Cal.App.4th 982, 1006.)
This argument is not persuasive.
Plaintiff also argues that Defendant breached the contract by failing to engage in the informal dispute resolution process initiated by Plaintiff pursuant to Section 15a. However, Tinder decided to take no action on Plaintiff’s information dispute, and did not even acknowledge receipt of the letter.
Tinder disputes that it ever received such letter from Plaintiff. However, because it is Plaintiff how is formally pursuing a Dispute, it was his obligation to send the notice to informally resolve it, as a condition precedent of filing an arbitration claim. If Plaintiff did send the letter and Defendant did not, or even if it did, receive the Notice, the period to informally resolve the dispute is 60 days after receipt of the Notice. Thereafter, either party may initiate arbitration. (See Terms of Use, Flashman Decl., Exh. 1 [bold emphasis added].) This argument is not persuasive.
Finally, Plaintiff argues that where the making of an arbitration agreement is in dispute, the Federal Arbitration Act (“FAA”) instructs courts to “proceed summarily to the trial thereof.” 9 U.S.C. § 4. If “the party alleged to be in default” demands a jury trial by “the return day of the notice of application,” courts are required to “make an order referring the issue or issues to a jury in the manner provided by the Federal Rules of Civil Procedure, or may specially call a jury for that purpose.” Id. See Deputy v. Lehman Bros., 345 F.3d 494, 509–10 (7th Cir. 2003) (“Section 4 thus required the court to hold a trial if the making of the arbitration agreement was in issue”). Same holds true under Texas law. Houston ANUSA, LLC v. Shattenkirk, 693 S.W.3d 513, 523 (Tex. App. 2023) (holding “that a fact issue regarding whether Shattenkirk consented to the arbitration agreement by electronic signature must be resolved by evidentiary hearing.”).
[T]the procedural provisions of sections
3 and 4 of the Arbitration Act only apply, by their express terms, to proceedings
in federal court, and have not been held applicable in state courts. ( Volt Info.
Sciences v. Leland Stanford Jr. U. (1989) 489 U.S. 468, 477, fn. 6 [103
L. Ed. 2d 488, 499, 109 S. Ct. 1248].) This means that the right to a jury trial
on the validity issue, set forth in section 4 of the Arbitration Act, does not apply
in state court proceedings. In [*186] California, the validity issue is determined upon
a petition to compel arbitration.
(Strauch v. Eyring (1994) 30 Cal.App.4th 181, 185-86.)
This argument is not persuasive.
As such, the Court finds that an agreement exists between the parties to arbitrate the dispute, claim or controversy arising from or relating to the Agreement, the Service, or Tinder’s relationship with Plaintiff. (Arbitration Agreement, ¶ 15c.) Any further issues as to enforceability of the arbitration agreement have been delegated to the arbitrator. (Id.)
Courts have held that “‘[t]here are two prerequisites for a delegation clause to be effective. First, the language of the clause must be clear and unmistakable. [Citation.] Second, the delegation must not be revocable under state contract defenses such as fraud, duress, or unconscionability.’” (Aanderud, supra, 13 Cal.App.5th at p. 892.)
(Mendoza v. Trans Valley Transp. (2022) 75 Cal.App.5th 748, 773.
The motion to compel arbitration and stay this action pending arbitration is GRANTED.