Judge: David S. Cunningham, Case: 20STCV00157, Date: 2023-02-09 Tentative Ruling

Case Number: 20STCV00157    Hearing Date: February 9, 2023    Dept: 11

20STCV00157 (Uriostequi) 

 

Tentative Ruling Re: Motion to Compel Arbitration 

 

Date:                                 2/9/23 

Time:                                11:00 am 

Moving Party:           Hotcakes No. 7, Inc. dba IHOP (“Defendant”) 

Opposing Party:        Lizbet Uriostequi (“Plaintiff”) 

Department:                 11 

Judge:                               David S. Cunningham III 

________________________________________________________________________ 

 

TENTATIVE RULING 

 

The hearing on Defendant’s motion to compel arbitration is continued. 

 

BACKGROUND 

 

Plaintiff worked at Defendant’s restaurant as a dishwasher and busser when she was a minor and as an adult.  She asserts multiple “wage and hour” causes of action – failure to pay overtime wages, failure to provide meal breaks, failure to provide rest breaks, etc. 

 

In August 2016, Plaintiff started working for Defendant and signed an arbitration agreement. 

 

Ultimately, Judge Ann Jones denied Defendant’s motion to compel arbitration under the 2016 agreement because Plaintiff was a minor when she signed it. 

 

Plaintiff was rehired by Defendant as an adult and, on 7/12/19, purportedly signed a second arbitration agreement.  

 

Now, Defendant moves to compel arbitration pursuant to the purported 2019 agreement. 

 

DISCUSSION 

 

Existence and Assent 

 

“[W]hen a petition to compel arbitration is filed and accompanied by prima facie evidence of a written agreement to arbitrate the controversy, the court itself must determine whether the agreement exists and, if any defense to its enforcement is raised, whether it is enforceable.”  (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413.)  

 

“Under ‘both federal and state law, the threshold question . . . is whether there is an agreement to arbitrate.’”  (Cruise v. Kroger Co. (2015) 233 Cal.App.4th 390, 396, emphasis in original.) 

 

The burden of proof rests with the petitioner.  (See Rosenthal, supra, 14 Cal.4th at 413 [requiring the petitioner to prove the existence of the agreement “by a preponderance of the evidence”].)  To meet the burden, “the provisions of the written agreement and the paragraph that provides for arbitration . . . must be stated verbatim or a copy must be physically or electronically attached to the petition and incorporated by reference.”  (Cal. Rules of Court, rule 3.1330; see also Condee v. Longwood Management Corp. (2001) 88 Cal.App.4th 215, 218 [same].) 

 

“Competent evidence is required to establish both the existence of the arbitration agreement and any ground for denial.”  (Knight, et al., Cal. Prac. Guide: Alt. Disp. Res. (The Rutter Group 2021) ¶ 5:321.)  “The verified petition (and attached copy of the agreement) normally proves the existence of the arbitration agreement.  Affidavits or declarations may be necessary when factual issues are tendered.”   (Ibid.) 

 

The purported 2019 arbitration agreement is attached to the declaration of Jennifer Steger, Defendant’s human resources director.  (See Steger Decl., Ex. 1.) 

 

Plaintiff contends the motion to compel should be denied because (1) Defendant is not covered by the agreement (Plaintiff claims Defendant is not named in the agreement, and, while International House of Pancakes is named, it is not a party in this case and did not employ her), and (2) Plaintiff did not sign the agreement (Plaintiff claims the signature on the agreement is not hers and is visibly different than her signature on the 2016 agreement). 

 

Defendant argues that (1) the agreement does cover Defendant (Defendant asserts that Plaintiff sued Defendant as Hotcakes No. 7, Inc. dba IHOP, IHOP is an acronym for International House of Pancakes, and, as a franchisee, Defendant is entitled to use the name International House of Pancakes and the IHOP acronym), and (2) Plaintiff did sign the agreement (Defendant claims Plaintiff’s signature on the agreement matches her signature on paycheck stubs she signed in 2019). 

 

The Court intends to continue the hearing.  Defendant’s assertion regarding franchisee status and entitlement to use the International House of Pancakes and IHOP names is based on reply evidence.  (See Steger Supp. Decl., ¶¶ 5-7.)  The paycheck stubs also constitute reply evidence.  (See id. at Ex. 1.)  Whether they match the signature on the 2019 agreement is a factual question that requires further evidence, including, perhaps, expert handwriting analysis, especially since Plaintiff declares that it is not her signature.  (See Plaintiff’s Decl., ¶¶ 3-7.)  Supplemental briefing is needed to address these issues, and the Court may need to hold an evidentiary hearing with live testimony. 

 

Waiver 

 

Plaintiff asserts that Defendant waived the right to compel arbitration by waiting nearly 18 months to seek arbitration under the 2019 agreement. 

 

The Court disagrees.  Defendant moved to compel arbitration under the 2016 agreement at the outset.  A discovery stay was put in place so the parties could pursue mediation.  The only other motion practice to this point was a motion to change venue, and the only exception to the discovery stay was targeted discovery concerning venue and unconscionability that Plaintiff requested.  Furthermore, Defendant represents that it filed the instant motion soon after it discovered the 2019 agreement, and Plaintiff fails to demonstrate prejudice.  These facts support denying the waiver argument.  

 

Judicial Estoppel 

 

Plaintiff claims Defendant should be judicially estopped from relying on the 2019 agreement. 

 

The Court disagrees.  The doctrine of judicial estoppel applies when: 

 

(1) the same party has taken two positions; (2) the positions were taken in judicial or quasi judicial administrative proceedings; (3) the party was successful in asserting the first position (i.e. the tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent; and (5) the first position was not taken as a result of ignorance, fraud, or mistake. 

 

(Jackson v. City of Los Angeles, (1997) 60 Cal. App. 4th 171, 183.) Defendant did not take two positions, it lost the first motion to compel, and the positions were not inconsistent since each motion involved a different agreement; thus, the doctrine is inapplicable. 

 

Covered Claims 

 

Plaintiff contends the 2019 agreement does not cover claims arising prior to the alleged signing date. 

 

This issue is premature, but the Court is inclined to agree with Plaintiff.  Defendant fails to cite language showing intent to apply the agreement retroactively.  Also, it would be improper to let Defendant use the agreement to backdoor claims from when Plaintiff was a minor.  At most, it likely covers claims from the signing date forward.