Judge: Gail Killefer, Case: 24STCV03085, Date: 2024-08-21 Tentative Ruling
Case Number: 24STCV03085 Hearing Date: August 21, 2024 Dept: 37
HEARING DATE: Wednesday, August 21, 2024
CASE NUMBER: 24STCV03085
CASE NAME: Olivia Pass v. Del Amo Hospital, Inc.
MOVING PARTY: Defendant Del Amo Hospital,
Inc.
OPPOSING PARTY: Plaintiff Olivia Pass
TRIAL DATE: Not set.
PROOF OF SERVICE: OK
PROCEEDING: Motion to Compel
Arbitration of Individual PAGA Claim and Stay Representative Action
OPPOSITION: 19 July 2024
REPLY: 25
July 2024
TENTATIVE: Defendant’s motion to
compel arbitration is denied. Defendant to give notice.
Background
On February 5, 2024, Olivia Pass
(“Plaintiff”) filed this PAGA action against Del Amo Hospital, Inc.
(“Defendant”) and Does 1 to 50.
The operative First Amended Complaint
(“FAC”), filed April 11, 2024, alleges eight causes of action:
1)
Violation
of Labor Code §§ 204, 510, 1194, 1198 (Failure to Pay All Wages);
2)
Violation
of Labor Code §§ 226.7, 512 (Failure to Provide Meal Periods);
3)
Violation
of Labor Code § 226.7 (Failure to Provide Rest Periods);
4)
Violation
of Labor Code § 226, (Failure to Keep Accurate Itemized Wage Statements);
5)
Violation
of Labor Code §§ 201-203, (Failure to Pay Wages Upon Termination of
Employment);
6)
Violation
of Labor Code § 2802 (Failure to Reimburse for Necessary Expenditures);
7)
Violation
of Bus. & Prof. Code § 17200 et seq. (Unfair Business Practices);
and
8)
Violation
of the Private Attorneys General Act, Labor Code sections 2698, et seq.
On April 24, 2024, Plaintiff dismissed
her individual claims for relief. Defendant now moves to compel Plaintiff’s
individual PAGA claims to arbitration and stay the representative PAGA action. 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.”].)¿
II. Request for Judicial Notice
The
court may take judicial notice of records of any court of record of the United
States. (Evid. Code, § 452(d)(2).) However, the court may only judicially
notice the existence of the record, not that its contents are the truth. (Sosinsky
v. Grant (1992) 6 Cal.App.4th 1548, 1565.)
Defendant’s
request judicial notice of the following:
1)
Class Action Complaint filed on
February 5, 2024, and First Amended Complaint
filed on April 11, 2024 by Plaintiff in
the Los Angeles Superior Court, Case No. 24STCV03085. (Cal. Evid. Code §
452(d)(1)).
2)
Exhibit 1:
Declaration of Lilit Tunyan in Support of Plaintiff’s Application to Dismiss
Class and Individual Claims for Relief One Through Seven Against Defendant
Without Prejudice filed on April 22, 2024. (Cal. Evid. Code § 452(d)(1)).
3)
Exhibit 2:
April 23, 2024 Order Dismissing Class and Individual Claims for Relief One
Through Seven Against Defendant Without Prejudice. (Cal. Evid. Code §
452(d)(1)).
Defendant’s request
for judicial notice is granted.
Plaintiff requests judicial
notice of the following:
1)
Exhibit A: Order dismissing Plaintiff
Olivia Pass’ individual PAGA claim against Defendant Del Amo Hospital, Inc.
without prejudice.
Plaintiff’s
request for judicial notice is granted.
III. Discussion
Defendant
moves for an order compelling Plaintiff to arbitrate her individual PAGA claims
and stay the action as to the representative claims pending arbitration.
Plaintiff opposes the Motion on the basis that she dismissed her individual
PAGA action and there are no individual PAGA claims to order to arbitration
such that the Motion should be denied.
A. Existence of A Valid Agreement to Arbitrate
Defendant
asserts that as part of the onboarding process, on November 4, 2022, Plaintiff reviewed
and executed the Alternative Resolution for Conflicts Agreement (the “ARC”).
(Shanner Decl., Ex. B.) Defendant’s records show that during the onboarding
process Plaintiff used a unique username and password to access the ARC
and after being apprised that a checkbox
is the equivalent to a handwritten signature, checked the box to state “yes” to
having reviewed and agreed to abide by the ARC terms. (Shanner Decl., ¶¶ 3-9.
Ex. A.)
The
ARC states in the relevant parts:
1.
How This Agreement Applies
This Agreement is governed by
Federal Arbitration Act, 9 U.S.C. § 1 . . . Excepts as it otherwise provides,
this Agreement applies to any past, present or future dispute arising out of or
related to Employee’s application for employment, employment, and/or
termination of employment . . .
Except as it otherwise
provides, this Agreement is intended to apply to the resolution of disputes
that otherwise would be resolved in the court of law or before a forum other
than arbitration.
Except as it otherwise
provides, this Agreement applies, without limitation, to disputes regarding the
employment relationship, compensation, breaks and rest periods, seating,
privacy, retaliation, discrimination, termination, or harassment . . .
[ ]
6. How Arbitration
Proceedings are Conducted
[ ]
You and the Company agree to
bring any dispute in arbitration on an individual basis only. Accordingly, . .
.
(c) Private Attorneys
General Act (“PAGA”) Individual Action Requirement. Your and the Company
agree to arbitrate PAGA claims on an individual basis only. Therefore, any
claim by You under PAGA to recover Your unpaid wages, penalties, or other
individual relief must be arbitrated under this Agreement. The Arbitrator is
without authority to preside over any PAGA claim by you on behalf of any other
person or joined by or consolidated with another person’s or entity’s PAGA
claim. This PAGA Individual Action Requirement clauses will be severable from
this Agreement if there is a judicial determination that it is invalid,
unenforceable, unconscionable, void or voidable. In such case, the PAGA action
must be litigated in a civil court of competent jurisdiction-not in
arbitration-but the portion of the PAGA Individual Action Requirement that is
enforceable will be enforced in arbitration.
[ ]
10. Enforcement
of this Agreement
This Agreement is the full and
complete agreement relating to the formal resolution of employment-related
disputes. Any contractual disclaimers the Company has in any handbooks, other
agreements, or policies do not apply to this Agreement. This Agreement will
survive the termination of Your employment and the expiration of any benefit,
and it will also continue to apply if You are transferred or rehired by an
affiliate of the Company and/or separated and rehired by the Company or its
affiliates. In the event any portion of this Agreement is deemed unenforceable,
the remainder of this Agreement will be enforceable. However, under no
circumstances may the Arbitrator hear or preside over any class, collective, or
other claim joined by or consolidated with another person's or entity's claim,
unless all parties agree in writing. This Agreement does not alter the
"at-will" status of Your employment.
(Shaner
Decl., ¶ 10, Ex. B.)
Plaintiff
does not deny that she signed the ARC on November 4, 2022. Instead, Plaintiff
asserts that because she dismissed her individual PAGA claim, there is no
individual PAGA claim to arbitrate, and the motion should be denied. Defendant
asserts that Plaintiff’s action fails because a PAGA cause of action requires
an individual PAGA without citing any authority to support this proposition.
B. Plaintiffs’ Dismissal of Her Individual
PAGA Claim does not Deprive Her of Standing to Assert a Representative PAGA
Claim
California
law holds “a plaintiff's inability to obtain individual relief is not
necessarily fatal to the maintenance of a PAGA claim.” (Kim v. Reins
International California, Inc. (2020) 9 Cal.5th 73, 85 (Kim)).
“Where a plaintiff has brought a PAGA action comprising individual and
non-individual claims, an order compelling arbitration of the individual claims
does not strip the plaintiff of standing as an aggrieved employee to litigate
claims on behalf of other employees under PAGA.” (Adolph v. Uber
Technologies, Inc. (2023) 14 Cal.5th 1104, 1114 (Adolph)). The
Plaintiff asserts that pursuant to Adolph, PAGA claims are severable and
that she can bring a representative PAGA claim without bringing an individual
PAGA claim.
Therefore,
Plaintiff need not maintain an individual PAGA claim to have standing to pursue
a representative PAGA claim. In Balderas v. Fresh Start
Harvesting, Inc. (2024) 101 Cal.App.5th 533 (Balderas), the Court of
Appeal for the Second District found that even if an employee does not bring an
individual PAGA action, the employee retains standing to bring a representative
PAGA action. “[W]e hold that an employee who does not bring an individual claim
against her employer may nevertheless bring a PAGA action for herself and other
employees of the company.” (Ibid.)
The Balderas Court
rejected the trial court finding that “because [the plaintiff] had not filed an
individual action seeking PAGA relief for herself, she lacked standing to
pursue a “non-individual” or representative PAGA action on behalf of other
employees.” (Balderas, supra, 101 Cal.App.5th at p. 533.) The Balderas
court explained that despite the plaintiff not bringing an individual PAGA
action, the plaintiff retained standing under Adolph to bring a
representative PAGA claim because in her complaint:
She
alleged that she 1) was an “aggrieved” employee of Fresh Start, and 2)
was subject to one or more Fresh Start violations. She alleged, “[W]hen
Employees including Ms. Balderas started work for Fresh Start at around 6:00
a.m. or 7:00 a.m., they regularly were not provided a meal period until after 5
hours of work for shifts longer than 5 hours.” This delay in providing timely
meal periods for her and other employees violated their right to have “a meal
period within the first five (5) hours of work.”
(Balderas, supra, 101 Cal.App.5th at p. 533.)
Accordingly, the
plaintiff in Balderas met the only two requirements needed for PAGA
standing: (1) she was an employee of the alleged violator and (2) was someone
“against whom one or more of the alleged violations was committed.” (Balderas,
supra, 101 Cal.App.5th at p. 533; see Lab. Code, § 2699) (c).) Consistent with the California Supreme Court’s
findings in Adolph and Kim,
the Balderas Court declined to impose additional standing requirements,
such as requiring the plaintiff to bring both an individual and a
representative PAGA action. As Defendant fails to show that
a PAGA action requires Plaintiff to maintain an individual PAGA claim, Defendant
fails to show that Plaintiff’s action should be dismissed for failure to state
a cause of action,.
Lastly,
while the question of whether Plaintiff is an “aggrieved employee” “against
whom one or more of the alleged violations was committed” (Lab. Code, §
2699(c)) is a dispute that is usually subject to arbitration, the ARC at issue
expressly created an exception for PAGA actions which states in the relevant
parts:
You and the Company agree to
arbitrate PAGA claims on an individual basis only. . . The Arbitrator
is without authority to preside over any PAGA claim by You on behalf of any
other person or joined by or consolidated with another person's or entity's
PAGA claim. . . In such case, the PAGA action must be litigated in a
civil court of competent jurisdiction-not in arbitration-but the portion of
the PAGA Individual Action Requirement that is enforceable will be enforced in
arbitration.
(Shaner
Decl., ¶ 10, Ex. B, § 6(c) [bold
added].)
As
the issue of Plaintiff’s standing to assert a representative PAGA claim is not
an individual PAGA claim subject to arbitration, the court cannot order
Plaintiff to arbitrate the issue of standing. Therefore, the motion to compel
arbitration is denied.
Conclusion
Defendant’s motion to compel arbitration is denied.
Defendant to give notice.