Judge: Gregory Keosian, Case: 23STCV28663, Date: 2024-04-04 Tentative Ruling

Case Number: 23STCV28663    Hearing Date: April 4, 2024    Dept: 61

Defendant Simplified Labor Staffing Solutions, Inc.’s Motion to Compel Arbitration is GRANTED.

Defendants to provide notice.

I.                   MOTION TO COMPEL ARBITRATION

On petition of a party to an arbitration agreement to arbitrate a controversy, a court must order the petitioner and respondent to arbitrate the controversy if it determines the arbitration agreement exists, unless (1) the petitioner has waived its right to arbitrate; (2) grounds exist for the revocation of the agreement; or (3) “[a] party to the arbitration agreement is also a party to a pending court action or special proceeding with a third party, arising out of the same transaction or series of related transactions and there is a possibility of conflicting rulings on a common issue of law or fact.” (Code Civ. Proc., § 1281.2.)

“[T]he party moving to compel arbitration bears the burden of establishing the existence of a valid agreement to arbitrate, and the party opposing arbitration bears the burden of proving by a preponderance of the evidence any fact necessary to its defense. The role of the trial court is to sit as a trier of fact, weighing any affidavits, declarations, and other documentary evidence, together with oral testimony received at the court's discretion, to reach a determination on the issue of arbitrability.” (Hotels Nevada v. L.A. Pacific Center, Inc. (2006) 144 Cal.App.4th 754, 758.)

Defendant Simplified Labor Staffing Solutions, Inc. (SLSS) moves to compel arbitration of Plaintiff Fernando Velez Rojas’ (Plaintiff) claims against it pursuant to an arbitration agreement executed by Plaintiff on November 5, 2019, covering all disputes between Plaintiff and SLSS “relating to or arising out of or in connection with employment at the Company or the termination of that employment.” (Motion Exh. 1.)

Plaintiff contends the agreement was fraudulently induced because it was presented to him in English without explanation as to its contents, along with a number of other documents, and with no instructions but to sign. (Opposition at pp. 12–14; Rojas Decl. ¶¶ 9–17.) However, “[u]nder the general contract principles . . .  the fact that [the plaintiff] signed a contract in a language he may not have completely understood would not bar enforcement of the arbitration agreement. If [the plaintiff] did not speak or understand English sufficiently to comprehend the English Contract, he should have had it read or explained to him.” (Ramos v. Westlake Services LLC (2015) 242 Cal.App.4th 674, 687.) Although Plaintiff contends that he does not functionally speak or read English, he does not contend that the content of the agreement was ever misrepresented to him. Thus there is no basis in fraud to deny the motion.

Plaintiff also contends that the arbitration agreement is unconscionable. “Unconscionability requires a showing of both procedural unconscionability and substantive unconscionability.” (Ajamian v. CantorCO2e, L.P. (2012) 203 Cal.App.4th 771, 795.) Arbitration contracts presented to employees on a take-it-or-leave-it basis are at least minimally procedurally unconscionable. (See Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 113.)

However, Plaintiff identifies no substantively unconscionable portions of the agreement. Although Plaintiff cites the failure to include an opt-out clause or to attach the AAA rules that would govern arbitration, Plaintiff acknowledges that these factors go to procedural rather than substantive unconscionability. (Opposition at pp. 16–17.) The sole unconscionable provision of the contract that Plaintiff identifies is its incorporation of the AAA discovery rules, which state in full: “The arbitrator shall have the authority to order such discovery, by way of deposition,

interrogatory, document production, or otherwise, as the arbitrator considers necessary to a full

and fair exploration of the issues in dispute, consistent with the expedited nature of arbitration.” (Opposition at p. 17.)

But the very case that Plaintiff cites to support the argument that this language is unduly restrictive stands for the opposite position. Plaintiff cites Davis v. Kozak (2020) 53 Cal.App.5^th 897, in which the court held invalid an arbitration discovery provision limiting each party to “a maximum of two depositions” without any “express provisions entitling the parties to propound interrogatories, requests for admission, or demand for production of all relevant documents,” and which permitted the exceeding of these limits only “on a showing of ‘sufficient cause.’” (Id. at p. 911.) The court there expressly distinguished that arbitration provision from the AAA discovery rule at issue here, citing another decision that express found the rule applicable to FEHA claims. (Id. at pp. 911–912; Roman v. Superior Court (2009) 172 Cal.App.4th 1462,1476 [“There appears to be no meaningful difference between the scope of discovery approved in Armendariz and that authorized by the AAA employment dispute rules, certainly not the role of the arbitrator in controlling the extent of actual discovery permitted.”].) The discovery rule is not unconscionable.

Plaintiff finally argues that no arbitration should be ordered because Defendant Eric Gallegos does not join the motion and did not sign the arbitration agreement. (Opposition at p. 11.) It is true that the court may deny an arbitration petition when “[a] party to the arbitration agreement is also a party to a pending court action or special proceeding with a third party, arising out of the same transaction or series of related transactions and there is a possibility of conflicting rulings on a common issue of law or fact.” (Code Civ. Proc., § 1281.2, subd. (c).) But there is no danger of conflicting rulings here. Gallegos has not appeared in this action, and Plaintiff has yet to file a proof of service applicable to him. If and when Gallegos appears in this matter, the arbitration agreement would be applicable to him as well, as the signature page of the arbitration agreement makes clear that it applies to “any such claim or dispute against the Company or any affiliated companies or entities, and all of their owners, employees, officers, directors or agents.” (Motion Exh. 1.) Because Gellegos is pleaded to be an employee of SLSS and is sued for acts committed in the course of his employment relationship, there is a high likelihood that the arbitration agreement is enforceable as to him. (Ronay Family Limited Partnership v. Tweed (2013) 216 Cal.App.4th 830, 839.) Even if Gallegos is not joined in the present motion, his absence thus furnishes no basis to deny it.

The motion to compel arbitration is therefore GRANTED.