Judge: Gail Killefer, Case: 23STCV11226, Date: 2024-06-13 Tentative Ruling
Case Number: 23STCV11226 Hearing Date: June 13, 2024 Dept: 37
CASE NUMBER: 23STCV11226
CASE NAME: Cynthia McKinney v. Dave & Buster’s Management Corporation, Inc.,
et al.
MOVING PARTY: Defendant Dave & Buster’s
Management Corporation, Inc.
OPPOSING PARTY: Plaintiff Cynthia McKinney
TRIAL DATE: Not Set
PROOF OF SERVICE: OK
PROCEEDING: Motion to Compel
Arbitration
OPPOSITION: 31 May 2024
REPLY: 6
June 2024
TENTATIVE: Defendant D&B’s Motion to Compel
Arbitration and stay the action is denied. Defendant to give notice.
Background
On May 17, 2023,
Plaintiff Cynthia McKinney filed a Complaint against Dave & Buster’s
Management Corporation, Inc. (“D&B” or “Defendant”); Justine Williams
(“Williams”), and Does 1 to 25.
On October 26,
2023, Plaintiff filed the operative First Amended Complaint (“FAC”) alleging
five causes of action: (1) Sexual Harassment in Violation of the Fair Housing
and Employment Act (“FEHA”), (2) Retaliation in Violation of FEHA, (3) Failure
to Prevent Sexual Harassment and Retaliation in Violation of FEHA, (4)
Retaliation in Violation of Labor Code § 1102.5, and (5) Wrongful Termination
in Violation of Public Policy.
On December 19, 2024,
the Parties stipulated to mediation with the understanding that if mediation
failed, the Defendant could refile a motion to compel arbitration.
On March 1, 2024,
Defendant D&B filed a Motion to Compel Arbitration. Plaintiff opposes the
Motion. The matter is now before the court.
I. Legal Standard
“California law reflects a strong public policy in favor of
arbitration as a relatively quick and inexpensive method for resolving
disputes.¿ To further that policy, Code of Civil Procedure, section 1281.2
requires a trial court to enforce a written arbitration agreement unless one of
three limited exceptions applies.¿ Those statutory exceptions arise where (1) a
party waives the right to arbitration; (2) grounds exist for revoking the
arbitration agreement; and (3) pending litigation with a third party creates
the possibility of conflicting rulings on common factual or legal¿ issues.”¿
(CCP § 1281.2; Acquire II, Ltd. v. Colton Real Estate Group (2013) 213
Cal.App.4th 959, 967.)¿ Similarly, public policy under federal law favors
arbitration and the fundamental principle that arbitration is a matter of
contract and that courts must place arbitration agreements on an equal footing
with other contracts and enforce them according to their terms.¿ (AT&T
Mobility LLC v. Concepcion (2011) 563 U.S. 333, 339.)¿¿
¿
In deciding a motion or petition to compel arbitration,
trial courts must first decide whether an enforceable arbitration agreement
exists between the parties and then determine whether the claims are covered
within the scope of the agreement.¿(Omar v. Ralphs Grocery Co. (2004)
118 Cal.App.4th 955, 961.)¿ The opposing party has the burden to establish any
defense to enforcement.¿ (Gatton v. T-Mobile USA, Inc. (2007) 152
Cal.App.4th 571, 579 [“The petitioner ... bears the burden of proving the
existence of a valid arbitration agreement and the opposing party, plaintiffs
here, bears the burden of proving any fact necessary to its defense.”].)¿
III. Discussion
A. Factual Summary
The FAC alleges that Defendant D&B employed
Plaintiff as a bartender in July 2021 and terminated her on or about December
10, 2022. (FAC, ¶¶ 8, 12.) Plaintiff asserts that while employed by Defendant,
she experienced sexual harassment by her supervisor/manager Justin Williams
(“Williams”). (FAC, ¶ 9.) The FAC asserts that the Plaintiff complained to the
manager above Williams who told her to “not say anything to anyone else” and
that he would make sure Williams stopped. (FAC, ¶ 10.) Plaintiff states that
despite her complaint, the harassment continued and Plaintiff’s attempt to
inform the General Manager about the harassment failed because the General
Manager never had time to hear Plaintiff out. (FAC, ¶ 10.) Plaintiff asserts that after she
voiced her complaints about sexual harassment, D&B terminated her on
December 10, 2022. Plaintiff filed the original complaint on May 15, 2023.
Defendant now moves to compel arbitration.
B. Existence of an Agreement to Arbitrate
“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. In these
summary proceedings, the trial court sits as a trier of fact, weighing all the
affidavits, declarations, and other documentary evidence, as well as oral
testimony received at the court’s discretion, to reach a final determination.
No jury trial is available for a petition to compel arbitration.” (Engalla
v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972 [Citations
Omitted].)¿
Defendant D&B
asserts that when Plaintiff began her employment, during the electronic
onboarding process Plaintiff received and electronically signed an arbitration
agreement (the “Agreement”). In the
Agreement, she agreed to submit all her employment-related disputes to
arbitration. (Walter Decl. ¶¶ 6-16, Ex. A.)
The Agreement
states in relevant part:
All disputes covered by this Agreement between
me and the Company shall be decided by a single arbitrator through arbitration
and not by way of court or jury trial. The Company and I expressly agree that
this Agreement shall be construed, interpreted and its validity and
enforceability determined, in accordance with the Federal Arbitration Act (9
U.S.C. § 1, et seq.).
(Walters Decl. Ex.
A at p. 1.)
Plaintiff’s
opposition does not deny that Plaintiff signed the Agreement or that the FAA
applies. Instead, Plaintiff asserts that the Agreement is barred by the Ending Forced Arbitration of Sexual Assault and
Sexual Harassment Act (the “EFAA”). (9 U.S.C. §§ 401, 402(a).)
C. Applicability of Ending Forced
Arbitration of Sexual Assault and Sexual Harassment
“The Ending Forced Arbitration of Sexual Assault and Sexual
Harassment Act of 2021 (“EFAA”), which President Biden signed on March 3, 2022,
amended the Federal Arbitration Act (“FAA”) to prohibit the enforcement of
otherwise enforceable arbitration agreements
for claims arising from sexual harassment. 9 U.S.C. § 402(a).” (Turner v. Tesla, Inc. (N.D. Cal. 2023) 686 F.Supp.3d
917, 920–921.) The EFAA “shall apply with
respect to any dispute or claim that arises or accrues on or after the date of
enactment of this Act.” (Pub.L. No 117-90, March 3, 2022, 136 Stat 28,
reprinted in notes foll. 9 U.S.C. § 401.) Although this provision limiting the
applicability of the Act is included in the Act itself and is not codified as a
subsection but rather as a statutory note, it is nevertheless part of the Act.
When interpreting a statute, “we must read it in the context of the entire Act,
rather than in the context of the ‘arrangement’ selected by the codifier.” (U.S.
v. Welden (1964) 377 U.S. 95, 98, fn. 4; see also Conyers v. Merit
Systems Protection Bd. (Fed. Cir. 2004) 388 F.3d 1380, 1382, fn. 2; Midland
Power Co-op. v. Federal Energy Regulatory Com'n (D.C. Cir. 2014) 774 F.3d
1, 3 [In cases where the United States Code and the Statutes at Large conflict,
the Statutes at Large version controls].)
Defendant
D&B argues that the EFAA does not apply because Plaintiff’s claims accrued
before March 3, 2022, when the EFAA became effective. “‘Although state law
determines the length of the limitations period, federal law determines when a
civil rights claim accrues.' ... Under federal law, 'a claim accrues when the
plaintiff knows or has reason to know of the injury which is the basis of the
action.’ [Citation].” (Javor v. Taggart (2002) 98 Cal.App.4th 795, 802
disproved on other grounds by Leon v. County of Riverside (2023) 14
Cal.5th 910.) “[A] plaintiff's claim accrues when the plaintiff learns of the
‘actual injury,’ i.e., an adverse employment action, and not when the plaintiff
suspects a ‘legal wrong,’ i.e., that the employer acted with a discriminatory
intent.” (Coppinger-Martin v. Solis (9th Cir. 2010) 627 F.3d 745,
749.)
Defendant
D&B fails to point to allegations in the FAC to show that Plaintiff
informed Williams’ manager prior to March 3, 2022, that Williams was sexually
harassing her. (FAC, ¶ 10.) The court need not decide when Plaintiff informed
William’s supervisor of the sexual harassment because the FAC alleges that
despite Plaintiff informing William’s supervisor of the harassment “the harassment
continued” presumably until December 10, 2022, when Defendant terminated Plaintiff’s
employment. (FAC, ¶¶ 10, 12.) Therefore, the continuing violation doctrine applies,
and Plaintiff’s sexual harassment claim did not accrue until after her
termination when the sexual harassment stopped. (See Fahnestock
v. Waggoner (9th Cir. 2017) 674 Fed.Appx. 708,
710; Richards v. CH2M Hill, Inc. (2001) 26 Cal.4th 798,
815.)
Defendant’s
moving papers also fail to address the fact that the EFAA applies either “to
any dispute or claim that arises or accrues on or after” March 3, 2022. (Pub.L. No 117-90, March 3, 2022, 136 Stat 28,
reprinted in notes foll. 9 U.S.C. § 401 [italics added].) Plaintiff argues the
EFAA applies because Plaintiff’s dispute arose after March 3, 2022, and because
Plaintiff endured harassment by Williams up until her termination on December
10, 2022. (FAC, ¶ 12.) Plaintiff filed her DFEH Complaint on or about May 17,
2023, well after the EFAA became effective. (Messrelian Decl. ¶ 4, Ex. A.)
“[T]terms
‘dispute’ and ‘claim’ have distinct meanings as used by Congress . . . [i]n
general, a claim arises for the first time when the plaintiff suffers an
injury.” (Kader v. Southern California Medical Center, Inc. (2024) 99
Cal.App.5th 214, 223 (Kader).) “A dispute arises when one party asserts
a right, claim, or demand, and the other side expresses disagreement or takes
an adversarial posture. [Citation.] In other words, ‘[a] dispute cannot arise
until both sides have expressed their disagreement, either through words or
actions.’ [Citation.] Until there is a conflict or disagreement, there is
nothing to resolve in litigation.” (Id. at pp. 22-223.) “[A] claim may
arise or accrue before a dispute arises, and additional claims may arise after
a dispute arises.” (Id. at pp. 224-225.)
Even
if Defendant can show that Plaintiff notified William’s supervisor about the
harassment before March 3, 2022, Defendant fails to show that D&B expressed
a disagreement or took an adverse position to Plaintiff’s complaint before
March 3, 2022, such that a dispute arose before the EFAA became effective. We
conclude the date that a dispute has arisen for purposes of the Act is a
fact-specific inquiry in each case, but a dispute does not arise solely from
the alleged sexual conduct.” (Kader, supra, 99 Cal.App.5th at p.
222.) In Kader, the court determined that “[u]der the plain meaning of
section 402, subdivision (a), the Act applies to the instant case, which was
filed after the effective date of the Act.” (Id. at p.
224.) Here, Plaintiff filed her original Complaint on May 15, 2023,
after the EFAA became effective. Accordingly, the EFAA applies.
Defendant
D&B further asserts that Plaintiff’s non-sexual harassment claims are
arbitrable and must be compelled to arbitration. The parties do not dispute
that the FAA governs the Agreement and that the EFAA requires application of
the EFAA. (9 U.S.C. § 402.) The EFAA specifies states “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.A. § 402(a).) Accordingly, the EFAA bars the entire Agreement, not
just the claims related to sexual harassment, even if the Agreement contains a
severance provision. Defendant fails to point to a provision in the EFAA that permits
the court to sever non-sexual harassment claims in the Complaint and compel
them to arbitration.
Finally,
the EFAA states that the issue of arbitrability is to be decided by the court,
not the arbitrator. “The applicability of this
chapter to an agreement to arbitrate and the validity and enforceability of an
agreement to which this chapter applies shall be determined by a court, rather
than an arbitrator, irrespective of whether the party resisting arbitration
challenges the arbitration agreement specifically or in conjunction with other
terms of the contract containing such agreement, and irrespective of whether
the agreement purports to delegate such determinations to an arbitrator.” (9
U.S.C.A. § 402(b).) Thus, Defendant’s argument that arbitrability is to be
decided by the arbitrator due to a delegation clause is without merit.
Defendant’s Motion is denied.
The court declines to issue a written statement
of decision under CCP §§ 632 and 1291.
Conclusion
Defendant D&B’s Motion to
Compel Arbitration is denied and stay the action is denied. Defendant to give
notice.