Judge: Gary Y. Tanaka, Case: 21TRCV00537, Date: 2022-09-22 Tentative Ruling
Case Number: 21TRCV00537 Hearing Date: September 22, 2022 Dept: B
LOS ANGELES SUPERIOR COURT – SOUTHWEST DISTRICT
Honorable Gary Y. Tanaka Thursday, September 22, 2022
Department B Calendar No. 7
PROCEEDINGS
Reyes Salgado Hernandez v. Geri Care V, LLC, et al.
21TRCV00537
Geri Care V, LLC, et al.’s Motion to Compel Arbitration
TENTATIVE RULING
Geri Care V, LLC’s Motion to Compel Arbitration is granted.
Background
Plaintiff filed the Complaint on July 23, 2021. Plaintiff alleges the following facts. Plaintiff is a former or current employee of Defendants. Plaintiff, individually, and on behalf of other similarly aggrieved employees, asserts a single cause of action for civil penalties under the Private Attorneys General Act (“PAGA”) for Labor Code violations that allegedly occurred during Plaintiff’s employment with Plaintiff’s employer.
Request for Judicial Notice
Plaintiff and Defendants’ requests for judicial notice are granted pursuant to Evidence Code Section 452(d).
Motion to Compel Arbitration
“California law reflects a strong public policy in favor of arbitration as a relatively quick and inexpensive method for resolving disputes. [Citation.] 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. [Citation.] 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. (§ 1281.2, subds. (a)–(c).)” Acquire II, Ltd. v. Colton Real Estate Group (2013) 213 Cal.App.4th 959, 967.
“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.” Giuliano v. Inland Empire Personnel, Inc. (2007) 149 Cal.App.4th 1276, 1284.
“The party opposing arbitration has the burden of demonstrating that an arbitration clause cannot be interpreted to require arbitration of the dispute. Nonetheless, this policy does not override ordinary principles of contract interpretation. [T]he contractual terms themselves must be carefully examined before the parties to the contract can be ordered to arbitration: Although [t]he law favors contracts for arbitration of disputes between parties, there is no policy compelling persons to accept arbitration of controversies which they have not agreed to arbitrate.” Rice v. Downs (2016) 247 Cal.App.4th 1213, 1223 (internal citations and quotations omitted).
In Rowe v. Exline (2007) 153 Cal.App.4th 1276, 1286, the Court of Appeal found that “a nonsignatory sued as an agent of a signatory may enforce an arbitration agreement.” Id. at 1286. In addition, “a nonsignatory who is the agent of a signatory can even be compelled to arbitrate claims against his will.” Id. at 1285, citing Harris v. Superior Court (1986) 188 Cal.App.3d 475, 477–78. Further, “in many cases, nonparties to arbitration agreements are allowed to enforce those agreements where there is sufficient identity of parties.” Valley Casework, Inc. v. Comfort Construction, Inc. (1999) 76 Cal.App.4th 1013, 1021. This includes nonparties as agents of a party as well as “a third party beneficiary of an arbitration agreement.” Ibid.
Defendants move for an order compelling arbitration and a stay of proceedings. The motion is made pursuant to Code of Civil Procedure §1281 et seq. and the FAA, on the grounds Plaintiff is bound by a written agreement to arbitrate the subject matter of the Complaint. Defendants argue that a valid arbitration agreement exists between the parties that requires arbitration of all disputes. Defendants also move pursuant to Code of Civil Procedure § 1281.4 to stay all proceedings.
Code Civ. Proc., § 1281.2 states, in relevant part: “On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party to the agreement refuses to arbitrate that 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[. . .]” “Generally, an arbitration agreement must be memorialized in writing. A party's acceptance of an agreement to arbitrate may be express, as where a party signs the agreement. A signed agreement is not necessary, however, and a party's acceptance may be implied in fact or be effectuated by delegated consent. An arbitration clause within a contract may be binding on a party even if the party never actually read the clause.” Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236 (internal citations omitted).
Defendants established the existence of a valid arbitration agreement between Plaintiff and Defendants. (Decl., Rafael A. Reyes, Ex. 1). The agreement provides that it “applies to Company employees, regardless of length of service or status, and covers all disputes relating to or arising out of an employee’s employment with the Company or the termination of that employment. . . . includ[ing]... wage or overtime claims or other claims under the Labor Code.” (Decl., Reyes, ¶ 17; Ex. 1, page 1). The agreement further states that the “mutual agreement to arbitrate claims . . . means that both you and the Company forego any right either may have to a judicial forum or a jury trial,” and that “[t]he arbitration shall be a traditional bilateral arbitration.” (Id.; Ex. 1, page 2.) Plaintiff agreed “to submit to final and binding arbitration any and all claims and disputes that are related in any way to [her] employment or the termination of [her] employment” and acknowledged “that final and binding arbitration will be the sole and exclusive remedy for any such claim or dispute against Antelope Valley Healthcare, its parent, subsidiary, sister or affiliated companies or entities.” (Id., Ex. 1, page 4). Plaintiff’s claim, herein, relate to her employment and termination. In addition, Defendants have established Plaintiff’s refusal to arbitrate. (Declaration of Elissa L. Gysi, ¶¶ 2–6).
Therefore, the burden shifts to Plaintiff to show that the arbitration clause should not be enforced. Rice, supra, 247 Cal.App.4th at 1223. Plaintiff did not meet her burden to show that the arbitration agreement should not be enforced.
Plaintiff opposes the motion on the ground that the request to arbitrate is contrary to California law as the California courts have determined that PAGA is a distinct, non-arbitrable cause of action that asserts a substantive right of the State of California. However, on June 15, 2022, the United States Supreme Court issued its opinion in Viking River Cruises, Inc, v. Moriana, 142 S.Ct. 1906 (2022). The Supreme Court held that employees who sign valid arbitration agreements are subject to arbitration of the PAGA actions on an individual basis. Viking River Cruises overruled the cases primarily relied upon by Plaintiff, including Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348. The cases relied upon by Plaintiff followed the previously binding, but now overruled, authority in Iskanian.
On July 17, 2022, the motion was heard and argued. The motion was continued to the instant date and both parties were provided the opportunity to submit supplemental briefing regarding the application of Viking River Cruises to the facts of the instant action.
Plaintiff argues that Viking River Cruises is distinguishable. Plaintiff contends that the arbitration agreement at issue in the instant motion must exactly mirror the one at issue in Viking River Cruises. Plaintiff states that Defendants’ agreement, however, does not contain a distinct severability clause wherein the parties agreed to the severing of a PAGA claim. Thus, Plaintiff maintains that the holding of Viking River Cruises cannot be applied to the instant motion.
However, Plaintiff’s argument is not convincing. Under Viking River Cruises, to compel arbitration of Plaintiff’s individual PAGA claim, there must be a valid arbitration agreement between Plaintiff and Defendant which encompasses the PAGA claim. Here, such an agreement exists. Plaintiff’s argument that her arbitration agreement must contain an explicit waiver of PAGA rights is a misreading of Viking River Cruises. The U.S. Supreme Court ordered arbitration despite the existence of the waiver. The waiver clause itself was not determinative to compelling arbitration. Instead, what is required is a valid and enforceable arbitration agreement which covers the PAGA claim. In the instant action, Plaintiff signed the arbitration agreement agreeing cover all disputes arising out of her employment. Pursuant to the agreement, Plaintiff agreed to forego her right to a jury trial and agreed that arbitration was the exclusive forum and sole basis for any remedies. In doing so, Plaintiff waived any right to pursue her individual PAGA claims in a court proceeding. Plaintiff argues that PAGA was not specifically referenced in the arbitration agreement. However, the broad language in her arbitration agreement which covers all claims arising out of the employment would also cover PAGA claims.
Therefore, the motion to compel arbitration is granted.
Defendant now also requests that the entire action be dismissed after the holding of Viking River Cruises which stated that Plaintiff’s non-individual representative PAGA claims must be dismissed. The Court makes no ruling as to this issue as this Court can only rule upon the motion, as it was set forth in the notice of motion filed by Defendant. The notice of motion only requested a stay of the action. Plaintiff was not given proper notice, in the motion, that Defendant was seeking a dismissal. Plaintiff, herself, may, of course, freely dismiss the action, or the parties can enter into an agreement which results in a dismissal. Finally, if no agreement can be obtained, a separately noticed motion for dismissal may be appropriate provided the proper procedural authority is set forth.
Therefore, the Motion to Compel Arbitration is granted. The action is stayed pending completion of arbitration.
An OSC re: status of arbitration is set for ____________.
Defendant is ordered to give notice of this ruling.