Judge Christopher K. Lui, Case Number: 24STCV33777, Date: 2025-03-20 Tentative Ruling

Judge: Christopher K. Lui, Case: 24STCV33777, Date: 2025-03-20 Tentative Ruling

Case Number: 24STCV33777 Hearing Date: March 20, 2025 Dept: 76

Plaintiff alleges that he suffered sexual orientation discrimination and harassment, and was terminated while he took a leave of absence.

Defendant Extra Space Management, Inc. moves to compel arbitration.

TENTATIVE RULING

Defendant Extra Space Management, Inc.’s motion to compel arbitration is GRANTED. The case is stayed pending arbitration.

A status conference regarding arbitration proceedings is set for August 20, 2025 at 8:30 a.m. Status conference briefs are due one week prior.

ANALYSIS

Motion To Compel Arbitration

Discussion

Existence of Arbitration Agreement

California favors arbitration. (Haworth v. Superior Court (2010) 50 Cal.4^th 372, 380.) Civ. Proc. Code, §1281.2 provides:

On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists, unless it determines that:

(a) The right to compel arbitration has been waived by the petitioner; or

(b) Grounds exist for the revocation of the agreement.

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. (Cable Connection, Inc. v. DIRECTV, Inc. (2008) 44 Cal.4th 1334, 1343; Code Civ. Proc., § 1281.) 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 evidence any fact necessary to its defense. (Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal.App.4th 348, 356.) The court may weigh the evidence by considering affidavits, declarations, documents and oral testimony. (Id. at 357.)

Moreover:

The FAA applies to contracts that involve interstate commerce (9 U.S.C. §§ 1, 2), but since arbitration is a matter of contract, the FAA also applies if it is so stated in the agreement. (See Victrola 89, LLC v. Jaman Properties 8 LLC (2020) 46 Cal.App.5th 337, 355 [260 Cal. Rptr. 3d 1].) Here, defendants assert, and plaintiffs do not dispute, that the FAA applies. We agree, as the Agreements provide the FAA would control.

Section 2 of the FAA provides in relevant part: “A written provision in … a contract … to settle by arbitration a controversy thereafter arising out of such contract or transaction … shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” (9 U.S.C. § 2.) Under the FAA, there is a strong policy favoring arbitration. (Citations omitted.) “The overarching purpose of the FAA … is to ensure the enforcement of arbitration agreements according to their terms … .” (Citations omitted.)

“‘Although the FAA preempts any state law that stands as an obstacle to its objective of enforcing arbitration agreements according to their terms, … we apply general California contract law to determine whether the parties formed a valid agreement to arbitrate their dispute.’” (Citations omitted.)

(Barrera v. Apple American Group LLC (2023) 95 Cal.App.5th 63, 76-77.)

Defendant presents an arbitration agreement electronically signed by Plaintiff on October 14, 2021, as part of the onboarding process. (Yoachum Decl., ¶ 7, Exhibit A.) The Yoachum Declaration lays out the process by which a newly-hired employee goes through the onboarding process, during which the arbitration agreement is presented for the employee’s agreement, and how Plaintiff electronically accepted the arbitration agreement (Schmand Decl., ¶¶ 4 – 7.) Plaintiff did not file an opposition disputing that he signed this agreement.

The pertinent terms of the Arbitration Agreement are as follows:

MUTUAL AGREEMENT TO ARBITRATE

In consideration of the at-will employment relationship between you and the Company (defined in Section 1, below) and the mutual desire of the parties to enter into this Agreement, you and the Company hereby agree that, except as otherwise provided in this Agreement, any and all disputes,

claims or controversies between the parties, including but not limited to any dispute arising out of or relating to this Agreement, the employment relationship between the parties, or the formation or termination of the employment relationship, that are not resolved by their mutual agreement

shall be resolved by final and binding arbitration by a neutral arbitrator. This Agreement includes Claims (defined in Section 4, below) that the Company may have against you, or that you may have against the Company. This Agreement affects your rights to a trial by a jury. You may wish to seek legal advice before signing this Agreement.

. . .

Section 4: Claims Subject to Arbitration

The “Claims” covered by this Agreement include, but are not limited, to claims for: wrongful termination; breach of any contract or covenant, express or implied; breach of any duty owed to you by the Company or to the Company by you; disclosure of trade secrets or proprietary information, improper use of Company property or equipment; personal, physical or emotional injury; fraud, misrepresentation, defamation, or any other tort claims; wages or other compensation due; penalties; benefits; reimbursement of expenses; discrimination or harassment, including but not limited to discrimination or harassment based on race, sex, pregnancy, religion, national origin, ancestry, age, marital status, physical disability, mental disability, medical condition, genetic characteristics, gender expression, gender identity, sexual orientation, or any other characteristic protected by law; retaliation; violation of any federal, state or other governmental constitution, statute, ordinance or regulation (as originally enacted and as amended), including but not limited to Title VII of the Civil Rights Act of 1964 (“Title VII”), the Age Discrimination in Employment Act of 1967 (“ADEA”), the Americans With Disabilities Act (“ADA”), the Fair Labor Standards Act (“FLSA”), the Employee Retirement Income Security Act (“ERISA”), the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the Family and Medical Leave Act (“FMLA”), the California Fair Employment and Housing Act (“FEHA”), the California Family Rights Act (“CFRA”), the California Labor Code, the California Civil Code, and the California Wage Orders.

As used herein, “Claims” does not mean any dispute if arbitration of the dispute is prohibited by law, such as claims for workers’ compensation and unemployment benefits. This Agreement is not intended to prevent you from filing complaints and/or claims with government agencies, commissions, board and/or other bodies of government. However, this Agreement is intended to cover such complaints and claims to the extent such coverage is permitted by law. Employees may learn more about their legal rights by visiting websites hosted by federal and state governmental agencies. Current links to some of these federal websites are listed below, although they are subject to change by the hosting agencies:

www.dol.gov;www.dol.gov/compliance/laws/comp-flsa.htm;

www.dol.gov/dol/topic/wages/index.htm; and www.eeoc.gov/.

(Arbitration Agreement, Pages 1 – 3 [bold emphasis added].)

The language of the arbitration agreement covers all causes of action asserted by Plaintiff in the Complaint for violation of the CFRA, FEHA, violation of Labor Code § 1102.5 and wrongful termination in violation of public policy.

The Court will proceed to address the Armendariz factors.

Armendariz Factors:

Where a party seeks to arbitrate nonwaivable statutory civil rights in the workplace (Fitz v. NCR Corp. (2004) 118 Cal.App.4th 702, 711-12), such as the FEHA claims involved here, there are:

five minimum requirements for the lawful arbitration of such rights pursuant to a mandatory employment arbitration agreement. Such an arbitration agreement is lawful if it “(1) provides for neutral arbitrators, (2) provides for more than minimal discovery, (3) requires a written award, (4) provides for all of the types of relief that would otherwise be available in court, and (5) does not require employees to pay either unreasonable costs or any arbitrators’ fees or expenses as a condition of access to the arbitration forum. Thus, an employee who is made to use arbitration as a condition of employment ‘effectively may vindicate [his or her] statutory cause of action in the arbitral forum.’ “ (Citation omitted.)

(Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 102.)

Initially, we see no reason why Armendariz’s “particular scrutiny” of arbitration agreements should be confined to claims under FEHA. Rather, under the Supreme Court’s analysis, such scrutiny should apply to the enforcement of rights under any statute enacted “for a public reason.”

(Mercuro v. Superior Court (2002) 96 Cal.App.4th 167, 180 [bold emphasis added].)

Moreover:

Armendariz held that to the extent that the arbitration agreement was silent on these issues, these requirements must be implied as a matter of law. (Armendariz, supra, 24 Cal.4th at pp. 106, 107, 113 [interpreted the agreement to provide for adequate discovery, a written arbitration award, and the employer’s payment of arbitration costs].) To the extent that the agreement expressly limited these rights, Armendariz held that the agreement was contrary to public policy and unenforceable. (Id. at p. 104 [stated that a provision limiting damages was unlawful].)

(Sanchez v. Western Pizza Enterprises, Inc. (2009) 172 Cal.App.4th 154, 176 [bold emphasis added].)

(1) Neutral arbitrators:

Here, the Arbitration Agreement states that the claims “shall be resolved by final and binding arbitration by a neutral arbitrator,” “each side in the dispute presents its case, including evidence, to a neutral third party,” and “you and the Company agree that any arbitration shall be conducted before one neutral arbitrator selected by the Parties.” (Yoachum Decl., Exh. A at p. 1.) In addition, the Arbitration Agreement is governed by JAMS, which sets forth that the arbitrator shall be neutral and shall have no bias or personal or financial interest in the results of the dispute.

(https://www.jamsadr.com/rules-comprehensive-arbitration/#:~:text=relevant%20and%20applicable.,Rule%207.,they%20shall%20be%20non%2Dneutral.)