Judge: Holly J. Fujie, Case: 24STCV05792, Date: 2024-08-06 Tentative Ruling

Case Number: 24STCV05792    Hearing Date: August 6, 2024    Dept: 56

 

 

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES - CENTRAL DISTRICT

 

TIMOTHY JOHN EVANS, an individual; OMAR ANTONIO CRUZ, an individual; EDWIN GUTIERREZ, an individual; WILFREDO FLORES, an individual,

                        Plaintiff,

            vs.

 

SIMPLIFIED TRANSPORT LLC, a

California limited liability company;

ASH WAHI, an individual; and DOES

1 through 20, inclusive,

                                                                             

                        Defendants.     

                        

 

      CASE NO.:  24STCV05792

 

[TENTATIVE] ORDER RE:

PETITION TO COMPEL ARBITRATION

AND STAY ACTION

 

Date: August 6, 2024

Time: 8:30 a.m.

Dept. 56

 

 

 

MOVING PARTY: Defendants SIMPLIFIED TRANSPORT LLC (“Simplified”); and ASH WAHI (collectively, “Defendants”)

 

RESPONDING PARTY: Plaintiffs TIMOTHY JOHN EVANS; OMAR ANTONIO CRUZ; EDWIN GUTIERREZ; and WILFREDO FLORES (“Flores”) (collectively, “Plaintiffs”)[1]

 

            The Court has considered the moving, opposition and reply papers.

 

BACKGROUND

This action arises out of an alleged employment relationship between Simplified and Plaintiffs, who were formerly hired as “flex drivers” by Simplified.  (Compl., ¶¶ 17, 33, 49, 65.) On March 7, 2024, Plaintiffs filed a complaint asserting the following causes of action: (1) failure to pay minimum wages pursuant to Labor Code §§ 1197 and 1198; (2) failure to pay overtime wages pursuant to Labor Code §§ 510 and 1198; (3) failure to provide meal breaks or meal break premium in lieu thereof pursuant to Labor Code §§ 226.7 and 512; (4) failure to provide rest breaks or rest break premium pursuant to Labor Code § 226. 7; (5) waiting time penalties pursuant to Labor Code § 203; (6) failure to provide accurate itemized wage statements pursuant to Labor Code §§ 226, 1174 and 1198; (7) failure to reimburse necessary business expenditures pursuant to Labor Code § 2802; (8) failure to pay wages due upon separation pursuant to Labor Code §§ 201 and 202; (9) failure to pay timely wages during employment in violation of Labor Code §§ 2014 and 1198; (10) unfair competition and unfair business practices in violation of Business & Professions Code § 17200, et seq.; (11) retaliation in violation of Labor Code § 98.6; (12) retaliation in violation of Labor Code § 1102.5; (13) retaliation in violation of Labor Code § 6310; and (14) wrongful termination in violation of public policy; (15) violation of Labor Code §§ 1400 to 1404 in violation of the Cal-WARN Act (failure to give required written notice).

 

On May 30, 2024, Defendants filed the instant petition to compel arbitration (the “Petition”), in lieu of an answer, seeking an order directing Flores (one of the Defendants) to submit his claims to binding arbitration.  On July 15, 2024, Simplified filed a Notice of Hearing of Petition to Compel Arbitration and Stay Action, attaching therewith its memorandum of points and authorities, supporting declarations and exhibits.

 

Plaintiffs filed an opposition on July 24, 2024, and Simplified filed a reply on July 31, 2024. 

             

EVIDENTIARY OBJECTIONS

             Plaintiffs’ objections to Maria Diaz and E. Sean McLoughlin’s individual declarations and the supporting exhibits attached to their respective declarations are OVERRULED.

 

            Plaintiff’s objections to the Supplemental Declaration of Maria Diaz and the supporting exhibits attached thereto are SUSTAINED. 

 

DISCUSSION

Legal Standard

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate a 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….”  (Code of Civil Procedure (“CCP”), § 1281.2; Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 409-10 [applying state rules of procedure to arbitration agreements subject to FAA].)  “The party seeking arbitration bears the burden of proving the existence of an arbitration agreement, and the party opposing arbitration bears the burden of proving any defense, such as unconscionability.”  (Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236.)

 

Under California law, public policy favors arbitration as an efficient and less expensive means of resolving private disputes.  (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 8-9; AT&T Mobility LLC v. Concepcion (2011) 563 U.S. 333, 339.  “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.”  (Acquire II, Ltd. v. Colton Real Estate Group (2013) 213 Cal.App.4th 959, 967, citing Code of Civ. Proc., § 1281.2, subds. (a)-(c).)  

 

The Federal Arbitration Act (FAA) similarly reflects a liberal federal policy favoring arbitration and the fundamental principle that arbitration is a matter of contract.  (Concepcion, supra, at 339.)  In line with these principles, courts must place arbitration agreements on an equal footing with other contracts and enforce them according to their terms.  (Ibid.)  “[U]nder both the FAA and California law, ‘arbitration agreements are valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.’ ”  (Higgins v. Sup. Ct. (2006) 140 Cal.App.4th 1238, 1247.)

 

Accordingly, whether an agreement is governed by the California Arbitration Act (CAA) or the FAA, courts resolve doubts regarding the scope of arbitrable issues in favor of arbitration.  (Moncharsh, supra, at 9; Comedy Club, Inc. v. Improv West Assocs. (9th Cir. 2009) 553 F.3d 1277, 1284; Engalla v. Permanente Med. Grp., Inc. (1997) 15 Cal.4th 951, 971-972 [“California law incorporates many of the basic policy objectives contained in the Federal Arbitration Act, including a presumption in favor of arbitrability [citation] and a requirement that an arbitration agreement must be enforced on the basis of state law standards that apply to contracts in general [citation]”].)  The party moving to compel arbitration bears the burden of proving the existence of a valid arbitration agreement that covers the claims, and the opposing party bears the burden of proving any fact necessary to its defense.  (Gatton v. T-Mobile USA, Inc. (2007) 152 Cal.App.4th 571, 579.)  

 

Applicability of the FAA

            Foremost, Flores contends that the FAA is inapplicable in the instant case because he is a “transportation worker” and, therefore, exempt from the FAA coverage.  Based on this argument, Flores posits that because the FAA does not apply, the Petition should be denied under California law, specifically Labor Code section 229, which prohibits arbitration of claims for unpaid wages.

 

            The question of whether Flores’ claims are arbitrable turns largely on the application of the FAA.  If this matter is governed only by California law, Labor Code section 229 provides an exception to the general rule favoring arbitrability.  Specifically, the statute states that actions to collect “due and unpaid wages claimed by an individual may be maintained without regard to the existence of any private agreement to arbitrate.”  (Lab. Code, § 229.)

 

Section 2 of the FAA (hereafter, “Section 2”) provides that “[a] written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.”  Courts broadly construe Section 2 to “provide for the enforcement of arbitration agreements within the full reach of the Commerce Clause.”  (Perry v. Thomas (1987) 482 U.S. 483, 490.)

 

Accordingly, in most cases, the FAA mandates arbitration when contracts involving interstate commerce contain arbitration provisions.  (Southland Corp. v. Keating (1984) 465 U.S. 1, 10–11; Cable Connection, Inc. v. DIRECTV, Inc. (2008) 44 Cal.4th 1334, 1351.)  In matters where the FAA applies, it preempts Labor Code section 229, thus requiring arbitration of claims that otherwise could be resolved in court.  (Perry v. Thomas (1987) 482 U.S. 483, 490–92.)

 

Here, the Mutual Arbitration Policy (the “MAP”), which contains the subject arbitration provision at issue, expressly states that the FAA governs.  (Declaration of Maria Diaz (“Diaz Decl.”), Exh. 1, p. 2 [“The MAP shall be governed solely by the Federal Arbitration Act (‘FAA’), 9 U.S.C. § 1, et seq.  If for any reason the FAA is deemed inapplicable, only then will the MAP be governed by the applicable state arbitration statutes.”].)   Moreover, Simplified has established that it is engaged in interstate commerce within the meaning of the FAA.  (Diaz Decl, ¶ 2.]  Simplified has numerous office locations in Southern California and also in states other than California.  (Id.)  Simplified supplies labor and staffing to customers in California and to customers who are based outside of California.  (Id.)  In conducting its business operations, Simplified purchases equipment, goods and services that originate from outside of California.  (Id.) 

 

 Thus, under other circumstances, this ends the inquiry as to the applicability of the FAA.  Here, however, Plaintiffs argue that Flores falls within a narrow exception, found in Section 1 of the FAA (hereafter, “Section 1”).  Section 1 provides a limited exemption from FAA coverage to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.”  (9 U.S.C. § 1; Circuit City Stores, Inc. v. Adams (2001) 532 U.S. 105, 109.)  In Circuit City, “the United States Supreme Court concluded Section 1’s catchall phrase ‘any other class of workers engaged in foreign or interstate commerce’ does not refer to all workers involved in foreign or interstate commerce, but rather only to ‘transportation workers’.” (Circuit City, supra, at 119, 121; Muller v. Roy Miller Freight Lines, LLC (2019) 34 Cal.App.5th 1056, 1062.)

 

Thus, the inquiry turns on whether Flores was a “transportation worker” under Section 1—i.e., whether he “actually engaged in the movement of goods in interstate commerce.”  (Circuit City, supra, at 112.)  That said, the Supreme Court in Circuit City “did not elaborate on what type of connection a worker must have to interstate commerce, to what degree his or her duties must involve transportation, to what degree the employer’s industry must be related to transportation, or whether the worker must cross state lines for the exemption to apply.”  (Muller, supra, at 1063.)

In the nearly twenty years since the Supreme Court decided Circuit City, “state and federal courts have grappled with these unresolved issues, but little consensus has been realized.”  (Muller, supra, at 1063).  Some focused on whether the employer was in the transportation industry; other courts focused on the nature of the particular employee’s work, e.g., whether the employee personally traversed state lines.  (Ibid.)

 

Despite these variances, one area of clear common ground among the courts is that “[when] a truck driver physically transports goods across state lines, he or she undoubtedly qualifies as a transportation worker under [S]ection 1.”  (Muro v. Cornerstone Staffing Solutions, Inc. (2018) 20 Cal.App.5th 784, 790-91.)  The Court of Appeal concluded, however, in Nieto v. Fresno Beverage Co., Inc., that interstate travel is not necessary for Section 1 to apply, and it held that a delivery driver may fall “within the scope of the exemption even though his deliveries were exclusively to destinations within California.”  (Nieto v. Fresno Beverage Co., Inc. (2019) 33 Cal.App.5th 274, 282.)  The Nieto court came to the conclusion that the delivery driver was “engaged in interstate commerce during his employment” in light of the following facts: the employer sold and distributed beer, wines, and other beverages that originated in other states and countries; although the employer’s drivers did not transport goods across state lines, they were nevertheless subject to federal Department of Transportation regulations and other federal laws and regulations governing motor vehicle safety; drivers traversed interstate highways and roads; and drivers transported the items as part of a “practical continuity of movement” in the flow of interstate commerce.  (Nieto, supra, at 284; Muller, supra, at 1066.)  The Nieto court further explained: “It is apparent from the above information and concessions that [the driver]’s deliveries, although intrastate, were essentially the last phase of a continuous journey of the interstate commerce (i.e., beer and other beverages delivered to [the] warehouse from out-of-state) being transported until reaching [the] destination(s) to [the] customers.  Accordingly, as a delivery truck driver [], [he] was engaged in interstate commerce through his participation in the continuation of the movement of interstate goods to their destinations.”  (Nieto, supra, at 284.)

 

            Here, the evidence sufficiently establishes that Flores was “actually engaged in the movement of goods in interstate commerce.”  (Circuit City, supra, at 112.)  That is, Flores has been transporting goods and/or materials that originated from outside of California.  (Diaz Decl., ¶ 2.)  Flores’ job was to transport goods and merchandise that he picked up from different ports and took them to warehouses in Los Angeles County and San Bernardino County.  (Declaration of Maya Fonseca, Interpreter/Translator Certifying Translation of Declaration of Plaintiff Wilfredo Flores (“Fonseca Decl.”), ¶ 20.)

 

            Like Nieto, Flores likely traversed interstate highways and roads, although remaining intrastate the entire time, to make deliveries.  Accordingly, the Court finds that Flores is a “transportation worker” engaged in interstate commerce for purposes of Section 1.  Hence, Flores is exempt from FAA coverage.  Because the FAA is inapplicable, the Court’s analysis is guided by California law, and more specifically, Labor Code section 229.

 

As previously mentioned, Section 229 provides that a cause of action seeking to collect “due and unpaid wages” pursuant to Labor Code sections 200 through 244 can be maintained in court despite an agreement to arbitrate.  (Khalatian v. Prime Time Shuttle, Inc. (2015) 237 Cal.App.4th 651, 656.)  Even if Flores is a transportation worker engaged in interstate commerce, however, Labor Code section 229 does not apply to the types of claims asserted by Flores.  Thus, the inapplicability of the FAA essentially has no bearing on the present lawsuit because Flores —although he alleges multiple wage and hour claims—does not actually allege a claim for unpaid wages.  This same issue arose in Lane v. Francis Capital Management LLC (2014) 224 Cal.App.4th 676, where the court held that claims for unpaid overtime, meal and rest periods violations, waiting time penalties, wage statement violations, and unfair competition are not subject to Section 229.  (Khalatian, supra, at 655 [only 2 of 11 wage and hour causes of action subject to 229].)  Because Section 229 does not apply to any of Plaintiff’s alleged causes of action here, Section 229 is not an impediment to arbitration of any part of Flores’ action.  Although Flores is exempt from the coverage of the FAA as a “transportation worker”, the California Arbitration Act nonetheless applies, and arbitration can likewise be compelled thereunder.  Accordingly, the Court continues its analysis on the gateway issues and any defenses to arbitration.

 

Existence of an Arbitration Agreement that Covers the Dispute at Issue

In determining the enforceability of an arbitration agreement, the court considers “two ‘gateway issues’ of arbitrability: (1) whether there was an agreement to arbitrate between the parties, and (2) whether the agreement covered the dispute at issue.”  (Omar v. Ralphs Grocery Co. (2004) 118 Cal.App.4th 955, 961.)

 

In California, “defendants may meet their initial burden to show an agreement to arbitrate by attaching a copy of the arbitration agreement purportedly bearing the opposing party’s signature . . . in compliance with the requirements of [CCP] section 1281.2 and California Rules of Court, rule 3.1330.”  (Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, 1060.)

 

Here, Simplified presents in evidence a copy of the MAP containing the arbitration provision as well as the signed Employment Agreement to Arbitrate (“Agreement”).  Simplified’s Director of Human Resources, Maria Diaz, declares that Flores received and reviewed the MAP and signed the Agreement on August 22, 2021.  (Diaz Decl., ¶ 6.)

 

In opposition, Flores contends that the evidence submitted by Simplified to demonstrate the existence of an arbitration agreement is inadmissible.  Specifically, Flores argues that Diaz’s declaration fails to establish any foundation to authenticate the document attached to her declaration.  The Court has overruled Plaintiffs’ evidentiary objection to the Declaration of Maria Diaz and the Court finds that Diaz’s declaration is sufficient to authenticate the Agreement. (Ev. Code, §§ 1400, 1416; People v. Skiles, (2011) 51 Cal.4th 1178, 1187 [the means of authenticating a writing are not limited to those specified in the Evidence Code; a writing can be authenticated by circumstantial evidence and by its contents].)  “For purposes of a petition to compel arbitration, it is not necessary to follow the normal procedures of document authentication.” (Id., at 218.) “[T]he court is only required to make a finding of the agreement’s existence, not an evidentiary determination of its validity.”  (Id., at 219.)

 

Notably, in spite of Flores claiming that he does not remember signing the Agreement, he does not deny and actually admits that the signature on the Agreement is indeed his.  (Fonseca Decl. ¶ 14.)  Flores also admits to receiving English documents during orientation for him to sign.  (Fonseca Decl., ¶ 11.)  Thus, Flores fails to controvert the evidence provided by Simplified to prove the existence of an arbitration agreement.

 

As for the scope of the arbitration agreement, the arbitration provision in the MAP broadly covers “all disputes relating to or arising out of or in connection with employment at the Company” including, specifically, “wage or overtime claims under the Labor Code.”  (Diaz Decl., Exh. 1, p. 1.)  Flores also does not dispute that his claims are covered by the arbitration agreement.

 

The Court finds that Simplified has met its burden of establishing (1) the existence of an agreement to arbitrate and (2) that Flores’ claims fall within the scope of the agreement to arbitrate.  Thus, the burden shifts to Flores to prove a ground for denial.

 

 Unconscionability

An arbitration agreement must be both procedurally and substantively unconscionable to be unenforceable.  (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 114; Mission Viejo Emergency Med. Assocs. v. Beta Healthcare Group (2011) 197 Cal.App.4th 1146, 1159 [unnecessary to decide whether insurance policy was adhesion contract and procedurally unconscionable because it was not substantively unconscionable].)

 

Procedural unconscionability concerns the manner in which the contract was negotiated and the parties’ circumstances at that time.  It focuses on the factors of oppression or surprise. (Kinney v. United HealthCare Services, Inc. (1999) 70 Cal.App.4th 1322, 1329.)  Substantive unconscionability focuses on the terms of the agreement and whether those terms are “overly harsh or one-sided.”  (Sonic-Calabasas A, Inc. v. Moreno (2013) 57 Cal.4th 1109, 1145.)

 

                        i.         Procedural Unconscionability

Here, Flores contends that the arbitration agreement is a contract of adhesion where his signature was “required” as a condition of employment, and he was never given an opportunity to negotiate any terms of the agreement.  As such, the agreement is unenforceable.

 

The Court is not persuaded by Flores’ assertion.  Even if Flores was required to sign the arbitration agreement as a condition of employment, this alone does not render the Agreement unenforceable.  “[The] adhesive aspect of an agreement is not dispositive. [Citation.] When … there is no other indication of oppression or surprise, ‘the degree of procedural unconscionability of an adhesion agreement is low, and the agreement will be enforceable unless the degree of substantive unconscionability is high.’”  (Serpa v. California Sur. Investigations, Inc. (2013) 215 Cal.App.4th 695, 704; Lagatree v. Luce, Forward, Hamilton & Scripps (1999) 74 Cal.App.4th 1105, 1127 [“[A] compulsory predispute arbitration agreement is not rendered unenforceable just because it is required as a condition of employment or offered on a ‘take it or leave it’ basis.”]; Graham v. Scissor-Tail, Inc. (1981) 28 Cal.3d 807, 817-818 [adhesion contracts are “an inevitable fact of life for all citizens—businessman and consumer alike”].)  Therefore, the Court does not find the arbitration agreement to be unconscionable purely on the basis of its adhesive nature.

 

Flores further contends that the arbitration agreement involves an element of surprise in that it is entirely in English.  Flores attests that his main language is Spanish, and that he “can’t read, write or speak English, except for a few words.”  (Fonseca Decl., ¶ 2.)  He claims that he was not provided with a Spanish translation of the documents he was asked to sign and that the contents of the documents he was signing were not explained to him.  (Id., ¶ 11.)

 

Even assuming that Flores did not understand the language of the Agreement, this alone is not a reason to invalidate it.  “Language fluency” arguments generally do not render an otherwise valid agreement unenforceable.  (Randas v. YMCA of Metropolitan Los Angeles (1993) 17 Cal.App.4th 153, 160; Bolanos v. Khalatian (1991) 231 Cal.App.3d 1596, 1590-1591.)  Flores should not have signed something that he did not understand in the first place.  (Randas, supra, at 163.)  “Ordinarily, one who accepts or signs an instrument, which on its face is a contract, is deemed to assent to all its terms, and cannot escape liability on the ground that he has not read it.  If he cannot read, he should have it read or explained to him.”  (Ibid.; Madden v. Kaiser Found. Hosps. (1976) 17 Cal.3d 699, 710 [“one who assents to a contract is bound by its provisions and cannot complain of unfamiliarity with the language of the instrument”].)  In Ramos v. Westlake Servs. LLC (2015) 242 Cal.App.4th 674, the court observed: “the fact that Ramos signed a contract in a language he may not have completely understood would not bar enforcement of the arbitration agreement. If Ramos did not speak or understand English sufficiently to comprehend the English Contract, he should have had it read or explained to him.” (Id., at 687.)  The court in Ramos ultimately found a lack of mutual assent, but not because the plaintiff did not understand English. The court noted: “Ramos is not attempting to avoid the arbitration agreement because of his limited understanding of the English language. Rather, he is relying on the fact that Pena’s Motors provided him with what purported to be a Spanish translation of the English Contract he was being asked to sign, a Spanish translation which did not contain the arbitration agreement.”  (Id.)  

 

Here, Flores does not claim that Simplified provided a Spanish translation of the Agreement that differed from the English version.  Rather, Flores contends that he did not understand the terms of the Agreement.  Flores, however, had the opportunity to request and review a Spanish translation, as stated both in the MAP as well as in the Agreement itself.  (Diaz Decl., Exh. 1, p. 3)  [“If you would like to receive or review a copy of the Company’s arbitration policy in Spanish, please request a Spanish version.”];  Id., p. 4 [“I acknowledge that I… have been provided an opportunity to request and review a Spanish translation as well.”].)  There is no indication in Flores’ declaration that he ever requested such a translation.   “A party cannot use his own lack of diligence to avoid an arbitration agreement.”  (24 Hour Fitness, Inc. v. Superior Court (1998) 66 Cal.App.4th 1199, 1215.)

 

Thus, the Court finds no, or at most, an exceedingly low, level of procedural unconscionability.

 

                       ii.         Substantive Unconscionability

“Substantive unconscionability pertains to the fairness of an agreement’s actual terms and to assessments of whether they are overly harsh or one-sided.  A contract term is not substantively unconscionable when it merely gives one side a greater benefit; rather, the term must be so one-sided as to ‘shock the conscience.’”  (Carmona, 226 Cal.App.4th 74, 85 (quotations and citations omitted).)  “The paramount consideration in assessing [substantive] unconscionability is mutuality.” (Id. [brackets in original].)

 

Flores asserts that the arbitration agreement fails to meet five of the Armendariz factors because it is (1) not mutual; (2) does not provide for adequate discovery; (3) is silent on Statutory

Remedies Available; (4) does not provide for the written decision by the arbitrator; (5) does not allow for a neutral arbitrator.

 

To be enforceable, an arbitration agreement in an employment contract must comply with the requirements of Armendariz.  The Armendariz requirements are that: “(1) the arbitration agreement may not limit the damages normally available under the statute; (2) there must be discovery sufficient to adequately arbitrate their statutory claim; (3) there must be a written arbitration decision and judicial review sufficient to ensure the arbitrators comply with the requirements of the statute; and (4) the employer must pay all types of costs that are unique to arbitration.”  (Little v. Auto Stiegler, Inc. (2003) 29 Cal.4th 1064, 1076.) 

 

Here, both the MAP and the Agreement are mutual and require both parties to arbitrate all claims arising from Flores’ employment with Simplified.  The MAP explicitly states that “[l]ikewise, the Company agrees to be bound by the MAP.  This mutual obligation to arbitrate claims means that both you and the Company are bound to use the MAP as the only means of resolving any employment-related disputes covered by the policy.”  (Diaz Decl., Exh. 1, p. 1.)  The Agreement similarly states that “the Company also agrees to submit all claims and disputes it may have with [Flores] to final and binding arbitration.”  (Id., p.4.)

 

The Court notes that the Agreement states that the arbitration agreement shall be governed by the AAA Rules.  (Diaz Decl., Exh. 1, p. 4.)  The AAA rules provide for discovery necessary for a full and fair exploration of the issues in dispute.  (Declaration of E. Sean McLoughlin (“McLoughlin Decl.”), Exh. 2 (Rule 9).  Under the AAA Rules, an employee is entitled to recover any remedy he would have otherwise been entitled to in a court of law, including attorney’s fees and costs.  (Id., (Rule 39(d).)  The MAP also states that “[i]f [Flores] wins, [he] can be awarded anything [he] might individually have received in a court.”  (Diaz Decl., Exh. 1, p. 2.)   The AAA Rules provide for a written decision by the arbitrator.  (McLoughlin Decl., Exh. 2 (Rule 39).)  The MAP similarly provides that the “arbitrator shall render a written decision on the matter…”  (Diaz Decl., Exh. 1, p. 2.)  Finally, the MAP provides for an “impartial and independent arbitrator” chosen by agreement of both parties (Id.), and the AAA rules likewise provide for a neutral selection process for the Arbitrator.  (McLoughlin Decl., Exh. 2 (Rule 12).)  Thus, contrary to Flores’ assertion, the arbitration agreement complies with the requirements of Armendariz.

 

In sum, the Court finds that Flores has not met his burden of demonstrating unconscionability.

 

RULING

Accordingly, Defendants’ Petition is GRANTED.  The Court STAYS this action pursuant to Code of Civil Procedure section 1281.4 pending arbitration.  The Court sets a status conference on February 3, 2025 at 8:30 a.m. in this department.  The parties are ordered to file a joint status report at least seven days prior to the status conference.  

 

Moving Party is ordered to give notice of this ruling.           

 

Parties who intend to submit on this tentative must send an email to the Court at SMC_DEPT56@lacourt.org as directed by the instructions provided on the court website at www.lacourt.org.  If the department does not receive an email and there are no appearances at the hearing, the motion will be placed off calendar.

 

Dated this 6th day of August 2024

 

 

 

 

Hon. Holly J. Fujie

Judge of the Superior Court

 

 



[1] Although the opposition is filed on behalf of all Plaintiffs, the assertions referenced in the discussion pertain to Flores as the individual party sought to be compelled to arbitration.