Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 205 

 

 

BACKGROUND 

 

  This case arises from an employment dispute.  Plaintiff Jane Doe was employed as a server for Defendant The Huntley Hotel (the “Huntley”) from 2016 until her constructive termination on May 13, 2022.  (First Amended Complaint (“FAC”) ¶¶18, 45.)   

Plaintiff alleges she was attacked and sexually assaulted by Defendant Ryan Jackson (“Jackson”), a co-worker, outside of work.  (FAC ¶ 18.)  Despite being told about the assault, Defendant Eman Rivani, the food & beverage director, conducted no investigation and scheduled Plaintiff and Jackson for the same shifts.  (FAC ¶¶ 31-32.)  Rivani told another co-worker that his plan was to make Plaintiff so uncomfortable that she would quit.  (FAC ¶42.)  

Defendant Manju Raman is the general manager of the Huntley.  (FAC ¶ 4.)  When another manager complained to Raman that Rivani was scheduling Plaintiff and Jackson on the same shifts, Raman responded that Plaintiff was sleeping with Jackson.  (FAC ¶¶ 36-37.)  When Plaintiff learned of the statement, she confronted Raman and also reported Rivani’s sexist and harassing conduct towards her and other female employees.  Again, no investigation was initiated.  (FAC ¶39.)  Instead, Raman told Plaintiff to “toughen up and grow a thick skin.”  (FAC ¶40.)  Raman also threatened Plaintiff that if she continued to make waves, “you need to ask yourself if the risk is going to be worth the reward.”  (Id.)    

On May 13, 2022, Plaintiff wrote the owners of the Huntley to file a formal complaint of sexual harassment and retaliation and informed them of her constructive discharge.  Plaintiff detailed Jackson’s sexually unwelcome conduct and Raman’s defamatory statement about an alleged consensual affair.   (FAC ¶ 45.)  Plaintiff also informed the owners that Raman and Rivani knowingly created intolerable working conditions such that she could not return to work.  (Id.)  Three nights later, Huntley responded via its owner that it was conducting an investigation, but Plaintiff was never interviewed.  (FAC ¶47.)   

A day later, Plaintiff called a suicide hotline reporting that she was suicidal due to the stress of what was happening to her at work.  The police arrived at Plaintiff’s home and took her under a 5150 hold.  (FAC ¶49.) 

The operative (first amended) complaint alleges 18 causes of action for (1) sexual harassment, (2) sex/gender discrimination, (3) failure to prevent discrimination and harassment in violation of FEHA, (4) retaliation in violation of FEHA, (5) constructive wrongful termination, (6) intentional infliction of emotional distress, (7) negligent supervision and retention, (8) violation of Labor Code § 1102.5, (9) violation of Labor Code § 6310, (10) failure to pay minimum wages, (11) failure to pay overtime wages, (12) failure to provide meal periods, (13) failure to authorize or permit rest periods, (14) failure to provide and maintain compliant wage statements, (15) illegal split shifts premium, (16) slander per se, (17) libel per se and (18) unfair business practices.   

On May 23, 2023, the Court denied Defendants’ motion to compel arbitration.  On June 12, 2023, Defendants filed a notice of appeal which automatically stayed the proceedings.  Defendants’ opening brief was originally due by January 2, 2024.  However, through requests for extensions from Plaintiff and the Court of Appeals, Defendants’ opening brief was due on March 18, 2024, nearly ten months after the Court denied Defendants’ motion to compel arbitration.   

This hearing is on Plaintiff’s motion to lift the stay.  Plaintiff argues that pursuant to Code Civ. Proc. §1294, the Court has discretion to lift the automatic stay, and should do so here because the stay prejudices her given her complaint was filed over a year ago and arises from unlawful conduct dating back to 2019.  The delay is likely to allow evidence to go cold or be spoliated and increases the risk that witnesses will become unavailable and memories will fade.     

EVIDENTIARY OBJECTIONS 

 

  The Court overrules Plaintiff’s objections to evidence in support of Defendants’ Opposition to Plaintiff’s Motion to Lift Stay as it fails to comply with the procedural requirements of California Rule of Court 3.1354 in that it does not quote or set forth the objectionable statement or material.   

DISCUSSION 

The Court concludes that the stay should be lifted.  Defendants are not entitled to a stay pending conclusion of their appeal.  Pursuant to Code Civ. Proc. §1294, an appeal of a denial of a motion to compel arbitration “shall not automatically stay any proceedings in the trial court during the pendency of the appeal.”   

Defendants have delayed in pursuing their appeal, seeking multiple extensions, resulting in their opening brief not being due until March 18, 2024, nearly ten months after this Court denied Defendants’ motion to compel arbitration.  The delay has unfairly prejudiced Plaintiff whose complaint was filed over a year ago and arises from events dating back to 2019.  A stay would prejudice Plaintiff as evidence may be lost, and witnesses’ memories may fade.    

Defendants argue that the appellate court has primary jurisdiction during the appeal, and this Court lacks jurisdiction to lift the stay.  Defendants’ argument ignores the language of Code Civ. Proc. §1294(a) which implicitly gives this Court discretion to lift a stay pending an appeal of a denial of a motion to compel arbitration.  Defendants rely on a series of Bankruptcy cases for the proposition that a request to lift a stay in trial court should be directed to the appellate court.  This is not a bankruptcy case so the automatic stay under the Bankruptcy Code does not apply here. 

Defendants next argue that the Court should not lift the stay because it would frustrate the pending appeal by allowing Plaintiff to conduct unfettered discovery which would deprive Defendants the essential value of going to arbitration in the first place.  However, the Legislature clearly knew of this potential effect when passing Code Civ. Proc. §1294(a), and Defendants’ argument is more properly directed at the Legislature than the Court.   

Defendants also argue that Code Civ. Proc. §1294(a) was not in place when Defendants filed their appeal, and it cannot apply retroactively.  Section 1294(a) took effect in January 1, 2024, and the notice of appeal was filed on June 12, 2023.  The Court concludes that application of the amended version of §1294(a) in this case does not amount to retroactive application for reasons articulated in the January 18, 2024 minute order in James Maxwell et al. v. Atria Park of San Mateo, Case No. 22-CIV-03985.  There, the Court concluded that §1294(a) was a procedural rule, and applying an amended procedural rule to a motion that was decided before the amendment was not considered a prohibited “retroactive” application.  The Court cited in support to Physicians Com. for Responsible Med. V. Tyson Foods Inc. (2004) 119 Cal.App.4th 120 (applying amended statute excluding certain types of claims from being subject to anti-SLAPP motions even though the amendment occurred after the anti-SLAPP motion was granted and while the case was on appeal) and Brown v. Friesleben Est. Co. (1956) 139 Cal.App.2d 1 (applying amendment to increase the deposit requirements for an appellate stay did not constitute a retroactive application).        

Defendants further argue Plaintiff is more to blame for the delays.  The Court disagrees.  Plaintiff alleges she was terminated on May 13, 2022; she sent a demand letter to Defendants on September 14, 2022; pre-litigation mediation was conducted on December 23, 2022, and Plaintiff filed her Complaint on February 15, 2023.  On this record, the Court cannot conclude that Plaintiff sat on her rights and was not diligent in prosecuting her case.  Neither Plaintiff’s refusal to submit to arbitration (when she claims she did not agree to arbitrate) nor her rejection of Defendants’ settlement offer at mediation (which she claims was a “low ball” offer) shows Plaintiff unnecessarily delayed the prosecution of her case.     

Finally, Defendants argue that §1294(a) is preempted by the Federal Arbitration Act (“FAA”), and the Supreme Court in Coinbase, Inc. v. Bielski (2023) 599 U.S. 736 in interpreting FAA §16, held that a district court must stay proceedings while an interlocutory appeal on the question of arbitration is ongoing.  (Id. at 743.)  But the FAA’s appellate procedures apply only to motions filed in federal court.  (Badgerow v. Walters (2022) 142 S.Ct. 1310, 1316 n. 2 (while FAA substantive provisions apply in state courts, the Supreme Court has never held that FAA procedural provisions apply in state courts); Southland Corp. v. Keating (1984) 465 U.S. 1, 16 n. 10 (“In holding that the Arbitration Act preempts a state law that withdraws the power to enforce arbitration agreements, we do not hold that §§ 3 and 4 of the Arbitration Act apply to proceedings in state courts”).  State courts following state arbitration appellate rules are not required to follow Coinbase.     

CONCLUSION 

For the foregoing reasons, the Court GRANTS Plaintiff’s motion to lift the stay on the instant action.  The Court sets a case management conference for April 30, 2024 at 9:00 a.m. The case management conference and status conference currently set for September 20, 2024 are taken off calendar. 

DATED: April 16, 2024 ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court