Judge: Colin Leis, Case: 23STCV08498, Date: 2023-09-27 Tentative Ruling

Case Number: 23STCV08498    Hearing Date: September 27, 2023    Dept: 74

Robert Cole, et al. v. Greystar Management

Motion to Compel Arbitration

The court considered the moving papers, opposition, and reply papers filed in connection with this motion.

BACKGROUND

            This action arises from an employment dispute.

            On April 17, 2023, Plaintiffs Robert Cole and Chaya Huston (Plaintiffs) filed a complaint on behalf of themselves and all aggrieved employees against Defendant Greystar Management Services, LP (Defendant). In their complaint, Plaintiffs allege various violations of the Labor Code.

            On June 9, 2023, Defendant filed this motion to compel arbitration.

DISCUSSION

            The parties dispute the extent to which the arbitration agreement’s Private Attorneys General Act (PAGA) waiver is enforceable. The agreement provides as follows: “By signing this agreement, you waive your right to commence, or be a party to, any class, representative, or collective claims or to bring jointly with any other person any claim against the Company.” (Adams Decl., ¶¶ 10, 14; Ex. A; Ex. C.) However, in Viking River Cruises, Inc. v. Moriana (2022) 142 S.Ct. 1906, 1924-1925 (Viking), the Supreme Court held that private arbitration agreements cannot effectuate a wholesale waiver of PAGA claims. But the Supreme Court also held that an employee who has entered an enforceable arbitration agreement may be compelled to arbitrate his individual PAGA claims. (Ibid.) Defendant contends the court should compel arbitration of Plaintiffs’ individual PAGA claims and dismiss their non-individual PAGA claims for lack of standing.

            Plaintiffs in turn argue the court should not enforce the PAGA waiver at all. To that end, they point to the following provision in the agreement: “If the prohibition against […] representative actions is deemed unlawful, then such action shall proceed forward in court as a potential […] representative action.” (Adams Decl., ¶¶ 10, 14; Ex. A; Ex. C.) But Plaintiffs have not persuaded the court that ‘representative actions’ encompasses their individual PAGA claims. (Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104, 1118 [recognizing distinction between individual PAGA claims and representative, non-individual PAGA claims].) Plaintiffs also liken the provision at issue to the ‘poison pill’ severability provision in Westmoreland v. Kindercare Education LLC (2023) 90 Cal.App.5th 967. There, the arbitration agreement provided that if the PAGA waiver was unenforceable, then the entire agreement was invalid and all PAGA claims had to proceed to a court of competent jurisdiction. (Id. at p. 972.) Such is not the case here. Under the agreement, if any provision is unlawful, that provision is automatically amended so the agreement is enforceable. (Adams Decl., ¶¶ 10, 14; Ex. A; Ex. C.) Moreover, if an employee challenges the validity of the waiver, Defendant may still ask the court to compel arbitration of each individual’s claims. (Adams Decl., ¶¶ 10, 14; Ex. A; Ex. C.) Thus, the court orders Plaintiffs’ individual PAGA claims to arbitration.

            Additionally, Defendant contends the court should dismiss Plaintiffs’ non-individual PAGA claims for lack of standing. Since the parties filed their supporting papers, though, the California Supreme Court held that “[A] plaintiff who files a PAGA action with individual and non-individual claims does not lose standing to litigate the non-individual claims in court simply because the individual claims have been ordered to arbitration.” (Adolph v. Uber Technologies, Inc., supra, 14 Cal.5th at p. 1128.) Accordingly, the court will stay Plaintiffs’ non-individual PAGA claims pending the arbitrator’s ruling of their individual PAGA claims.

CONCLUSION

                Based on the foregoing, the court grants Defendant’s motion to compel arbitration of Plaintiffs’ individual PAGA claims. The court denies Defendant’s request to dismiss Plaintiffs’ non-individual PAGA claims. The court instead stays the non-individual PAGA claims while the arbitration of Plaintiffs’ individual claims is pending.

Defendant shall give notice.