Judge: David B. Gelfound, Case: 24CHCV03151, Date: 2025-03-05 Tentative Ruling

Case Number: 24CHCV03151    Hearing Date: March 5, 2025    Dept: F49

LOS ANGELES SUPERIOR COURT

NORTH VALLEY DISTRICT

DEPARTMENT F49

MOTION TO COMPEL ARBITRATION

Motion filed: 12/23/24

MOVING PARTY: Defendants Advantage Solutions, Inc. and Club Demonstration Services, Inc.

RESPONDING PARTY: Plaintiff Maria Coleman

NOTICE: OK.

RELIEF REQUESTED: An order (1) compelling Plaintiff to submit her claims to binding arbitration, and (2) staying this action pending completion of the arbitration.

TENTATIVE RULING: The motion is DENIED.

BACKGROUND

On September 3, 2024, Plaintiff Maria Coleman (“Plaintiff” and “Coleman”) filed a Complaint against Defendants Advantage Sales and Marketing Group, Inc. (“ASMG”), Advantage Solutions, Inc. (“ASI”), Club Demonstration Services, Inc. (“CDS”), Violeta Tesoro (“Tesoro”), and Does 1 through 20. The Complaint alleges the following nine causes of action: (1) Sexual Harassment and Hostile Work Environment in Violation of FEHA, (2) Sex Discrimination in Violation of FEHA, (3) Disability Discrimination in Violation of FEHA, (4) Failure to Accommodate in Violation of FEHA, (5) Failure to Engage in the Interactive Process in Violation of FEHA, (6) Failure to Prevent Harassment and Discrimination in Violation of FEHA, (7) Retaliation in Violation of FEHA, (8) Interference with CFRA Rights, and (9) Wrongful Termination in Violation of Public Policy. Subsequently, on October 14, 2024, Defendants ASI and CDS filed a joint Answer to the Complaint.

On October 18, 2024, Plaintiff filed a request for dismissal, dismissing Defendant ASMG without prejudice. The request was entered by the Court Clerk on the same day.

On December 23, 2024, Defendants ASI and CDS (collectively, the “Moving Defendants”) filed the instant Motion to Compel Arbitration (the “Motion”). Subsequently, Plaintiff filed an Opposition on February 20, 2025, and Moving Defendants submitted a Reply on February 26, 2025.

ANALYSIS

The Federal Arbitration Act (“FAA”) applies to agreements to arbitrate disputes arising from a contract involving interstate commerce and it preempts all state laws and rules that conflict with its provisions or its objective of enforcing arbitration agreements.” (Acquire II, supra, 213 Cal.App.4th at p. 968; see 9 U.S.C. § 2 [FAA applies to a “contract evidencing a transaction involving commerce”].) “Employment contracts, except for those covering workers engaged in transportation, are covered by the FAA.”  (E.E.O.C. v. Waffle House, Inc. (2002) 534 U.S. 279, 289.)

More recently, Congress amended the FAA by adopting the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (“EFAA”) in 2022. In relevant part, the EFAA provides: “Notwithstanding any other provision of this title, at the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute, ... no predispute arbitration agreement or predispute joint-action waiver shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the sexual assault dispute or the sexual harassment dispute.” (9 U.S.C. § 402(a).) A “sexual harassment dispute” is “a dispute relating to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State law.” (Id., § 401(4).) A “sexual assault dispute” is “a dispute involving a nonconsensual sexual act or sexual contact, as such terms are defined in section 2246 of title 18 or similar applicable Tribal or State law.” (9 U.S.C. § 401(3).)

Under Code of Civil Procedure section 1281.2, “On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a 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 the court finds that the right to compel arbitration has been “waived by the petitioner,” or that “grounds exist for rescission” of the arbitration agreement. (Code Civ. Proc., § 1281.2, subds. (a) & (b).)

“The petitioner bears the burden of proving the existence of a valid arbitration agreement by the preponderance of the evidence, and a party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense.” (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972.)

Moving Defendants argue that the FAA governs the arbitration agreement in this case, even though certain causes of action fall under the EFAA exception.

Plaintiff opposes the Motion on the grounds that (1) the EFAA prohibits compelling arbitration of the entire case because all Plaintiff’s claims either involve nonconsensual sexual contact or are related to conduct that constitutes sexual harassment, and (2) the purported arbitration agreement and confidentiality agreement are unenforceable due to unconscionability.

A.    Evidentiary Objections

The Court has reviewed the evidentiary objections submitted by Moving Defendants in response to Plaintiff’s Opposition. It will not address each objection individually. Instead, the Court's analysis focuses on the substance of the objections to the extent they are relevant to the determination of the Motion. Parties are advised to review the Court's analysis and raise any specific concerns during the oral argument.

B.     Request for Judicial Notice

The Court grants Moving Defendants’ request for judicial notice of the November 17, 2024, Minute Order issued in David Gomez v. SAS Retail Services, LLC, Los Angeles County Superior Court Case No. 23STCCV07028.

When taking judicial notice of court records, the Court accepts as true only that (1) they were filed and (2) the assertions therein were made; however, the Court does not take notice of the truth of their contents. (See Joslin v. H.A.S. Ins. Brokerage (1986) 184 Cal.App.3d 369, 374-375; see also Day v. Sharp (1975) 50 Cal.App.3d 904, 916.)

C.    The EFAA

Pursuant to 9 U.S.C. § 402(a): “Notwithstanding any other provision of this title, at the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute, or the named representative of a class or in a collective action alleging such conduct, no predispute arbitration agreement or predispute joint-action waiver shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the sexual assault dispute or the sexual harassment dispute.”  Subsection 402(b) further provides: “[a]n issue as to whether this chapter applies with respect to a dispute shall be determined under Federal law.” 

Pursuant to 9 U.S.C. § 401(4), Congress defines a “sexual harassment dispute” as follows: “The term ‘sexual harassment dispute’ means a dispute relating to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal or State law.” Additionally, Congress specified that the provisions of the EFAA would “apply with respect to any dispute or claim that arises or accrues on or after the date of enactment of this Act [March 3, 2022].” (Pub. L. No. 117-90, § 3, 136 Stat 26, 28 (2022).) (Underlines added.)

(1)   Plaintiff’s Claims Are Related to Sexual Harassment

Here, it is undisputed that the arbitration agreement in question is a predispute arbitration agreement. Plaintiff specifically alleges a First Cause of Action for Sexual Harassment under Government Code section 12940, subdivision (j), which makes it an unlawful employment practice “[f]or an employer .... because of ... sex ... to harass an employee.” Plaintiff alleges that she began working for Moving Defendants as a sales ambassador in April 2017. (Compl. ¶ 11.) During her employment, Moving Defendants’ employee, including Defendant Tesoro, allegedly “made unwanted sexual advances towards Plaintiff and repeatedly groped Plaintiff by grabbing Plaintiff’s crotch [at] the workplace.” (Id. ¶ 43.) Moreover, Plaintiff alleges a pattern of Tesoro’s continuous sexual harassment between 2019 and December 2023 (Id. ¶¶ 11-15.)

As the appellate court stated in Doe v. Second Street Corp. (2024) 105 Cal.App.5th 552 (Second Street): “[T]he EFAA applies where a plaintiff alleges a course of sexually harassing conduct that occurs both before and after the EFAA's enactment. . . . [T]he high court has held in the statute of limitations context that “a hostile work environment claim ... will not be time barred so long as all acts which constitute the claim are part of the same unlawful employment practice and at least one act falls within the [limitations] period.” (Id. at p. 571, internal citations omitted.)

Applying Second Street’s reasoning, Plaintiff’s First Cause of Action for Sexual Harassment alleges continuing violations, with at least some conduct occurring after the EFAA’s effective date. Thus, the Court finds that Plaintiff’s First Cause of Action for Sexual Harassment qualifies as a “sexual harassment dispute” under 9 U.S.C. § 401(4).

Consequently, the First Cause of Action directly implicates EFAA which bars enforcement of the predispute arbitration agreement.

            Moreover, the EFAA “does not require that the pendant claims arise out of the sexual assault or sexual harassment dispute; it is enough that the case relates to the sexual assault or sexual harassment claims.” (Second Street, supra, 105 Cal.App.5th at p. 577, italics in original.)

Here, Plaintiff’s Second Cause of Action for Sexual Discrimination, Sixth Cause of Action for Failure to Prevent Harassment, Seventh Cause of Action for Retaliation, and Ninth Cause of Action for Wrongful Termination are all based in part on the sexual harassment alleged in the First Cause of Action. Plaintiff alleges that Moving Defendants knew of Tesoro’s harassing conduct towards Plaintiff; however, they failed to take appropriate steps to stop the harassment or prevent it from happening repeatedly. (Compl. ¶¶ 53, 89, 90.) Additionally, Plaintiff alleges that Moving Defendants retaliated against her by falsely and pretextually wrongfully terminating Plaintiff on February 19, 2024, because she had complained of sexual harassment. (Id. ¶ 99.)

            Furthermore, Plaintiff’s Third Cause of Action for Disability Discrimination, Fourth Cause of Action for Failure to Accommodate, Fifth Cause of Action for Failure to Engage in the Interactive Process, Eighth Cause of Action for Interference with CFRA Rights also relate to Moving Defendants’ termination of Plaintiff for taking medical leaves for mental illnesses, including Post-Traumatic Stress Disorder, Depression, and Anxiety, and Adjustment Disorder, which were allegedly caused and exacerbated by the sexual harassment. (Compl. ¶¶ 70, 71, and 91.)

            Accordingly, the Court finds that each of Plaintiff’s claims in the operative Complaint arises from or relates to the alleged conduct that constitutes sexual harassment. Pursuant to 9 U.S.C. § 402(a), the alleged predispute arbitration agreement is invalid and unenforceable as it applies to the claims asserted in the action.

            The Court therefore DENIES the Motion.

(2)   EFAA Applies to the Entire Case

Even assuming that Moving Defendants’ position is correct –  that only the First and Second Causes of Action constitute the sexual harassment dispute under EFAA – established case law nonetheless holds that the EFAA applies to bar the entire case, not individual claims. As such, the arbitration agreement is invalid as to the entire case.

The EFAA explicitly applies to “a case which…relates to the sexual assault dispute or the sexual harassment dispute.”  (9 U.S.C. §402(a), underlines added.) By its plain language, the statute applies to the entire case, not merely the individual sexual assault or sexual harassment claims asserted within it. (Arouh v. GAN Limited (C.D. Cal., Mar. 22, 2024) No. 8:23-cv-02001-FWS) 2024 WL 3469032, p. *6 [“When a plaintiff brings several claims, some of which are sexual harassment claims and some of which are not, the EFAA precludes arbitration as to all claims ....”]; Watson v. Blaze Media LLC (N.D. Tex., Aug. 21, 2023, No. 3:23-CCV-02790B) WL 5004144, at *2 [“If a plaintiff alleges a sexual harassment dispute, a predispute arbitration agreement is unenforceable as to ‘the entirety of the case relating to the sexual harassment dispute, not merely the discrete claims in that case that themselves either allege such harassment or relate to a sexual harassment dispute’ ”].)

Moving Defendants urge the Court to adopt an alternative analysis articulated in Mera v. SA Hospitality Group, LLC (S.D.N.Y. 2023) 675 F.Supp.3d 442 (Mera). In Mera, the plaintiff alleged both harassment claims that were unique to him and wage-and-hour claims on behalf of all nonexempt employees. (Id. at p. 448.) The Mera court thus concluded that the wage-and-hour claims were subject to arbitration, reasoning that they “do not relate in any way to the sexual harassment dispute.” (Ibid.)

The Court declines to follow Mera for several reasons.

First, unlike Mera, the claims in this case all relate, at least in part, to the alleged sexual harassment and its consequences, including retaliation and termination.

Second, Mera’s reasoning conflicts with Congress’s deliberate distinction between the terms “case” and “claim” in the EFAA. As the court explained in Johnson v. Everyrealm, Inc. (S.D. New York, Feb. 24, 2023) 657 F.Supp.3d 535: “When Congress includes particular language in one section of a statute but omits it in another, th[e] Court presumes that Congress intended a difference in meaning. [Citation.] Courts presume ‘that Congress intended the words in a statute to carry weight. [Citations.] The reading of the EFAA that lends coherence to the use of these separate terms assigns distinct meanings to ‘case’ and ‘claim,’ with the former referring to the entirety of the lawsuit in which claim(s) implicating a sexual harassment dispute are brought.” (Id. at pp. 559-560.)

Accordingly, the Court finds that the EFAA applies to the entire case, not just individual claims, rendering the arbitration agreement unenforceable.

On this independent basis, the Court DENIES the Motion.

Having so concluded, the Court need not address the alternative ground Plaintiff asserts in her Opposition – that the arbitration agreement is unenforceable due to procedural and substantive unconscionability.

Based on the foregoing, the Court DENIES the Motion.

CONCLUSION

The Motion to Compel Arbitration, filed by Defendants Advantage Solutions, Inc. and Club Demonstration Services, Inc., is DENIED.

Moving party to provide notice.