Judge John J. Kralik, Case 22STCV26984 2023-02-10 Tentative Ruling

Plaintiff Kimberly K., by and through her guardian ad litem William Ferrell, alleges that she was raped, sexually assaulted, sexually harassed, abused, and sexually battered by Defendant Rafael Moya (“Moya”), while Plaintiff was a patient confined to the lockdown unit at Defendant Imperial Care Center LLC (“ICC”). Plaintiff alleges that the rape occurred on March 12, 2022. Plaintiff alleges that Defendants ICC Convalescent Corp. (“ICC Convalescent”), Longwood Management Corp. (“Longwood”), Comfort Care Hospice Inc. (“Comfort Care”), and Aveanna Healthcare, LLC (“Aveanna”) negligently hired, supervised, and retained Moya.

The complaint, filed on August 18, 2022, alleges causes of action for: (1) elder/dependent adult abuse and neglect; (2) negligence; (3) professional negligence; (4) false imprisonment; (5) sexual battery (Civil Code, § 1708.5); (6) IIED; (7) violation of Civil Code, § 51.9; (8) neglect; (9) negligent hiring; (10) negligent control; (11) premises liability; and (12) enhanced remedies (CACI 3104 & 3102A). The 1^st–8^th and 12^th causes of action are brought against all Defendants. The 9^th–11^th causes of action are brought against ICC, ICC Convalescent, Longwood, Comfort Care, and Aveanna.

On September 28, 2022, Defendants ICC Convalescent Corp., Longwood Management Corporation, and Imperial Care Center, LLC filed a motion to compel arbitration and request for stay of the entire action. On November 3, 2022, Plaintiff filed an opposition brief. On November 9, 2022, Defendants filed a reply brief.

On October 31, 2022, Defendant Comfort Care Hospice, Inc. (“CCH”) filed a demurer and a motion to strike portions of the complaint. On January 30, 2023, Plaintiff filed opposition briefs. On February 6, 2023, CCH filed a reply brief.

Defendants ICC Convalescent, Longwood, and ICC move to compel Plaintiff to arbitrate this matter against the moving defendants and for the action to be removed from the civil active list pending the outcome of the arbitration. (Mot. at p.3.)

In support of the motion, Defendants provide the declaration of Roxanne Reyna, counsel for Defendants.

A “STATEMENT OF AUTHORITY TO ACT ON BEHALF OF RESIDENT” is provided, showing that William Ferrell is the authorized agent to act on Plaintiff/Resident’s behalf and is the agent for purposes of making decisions, related to delivery of healthcare, including but not limited to the authority to consent to healthcare/treatment and the authority to enter into legal and financial agreements related to the delivery of the healthcare of the patient. The Statement of Authority is signed by William Ferrell as the “Surrogate Decision Maker” on July 22, 2017 and is not signed by Plaintiff/Resident. (Reyna Decl., Ex. 3.)

An “ADVANCE HEALTH CARE DIRECTIVE” is also attached as Exhibit 4 to Ms. Reyna’s declaration. The document states that Plaintiff’s designated agent (the attorney-in-fact) has the power to make health care decisions for Plaintiff when she is no longer capable of making decisions for herself, including the consent to physicians not giving treatment or stopping treatment necessary to keep Plaintiff alive. (Reyna Decl., Ex. 4 at p.1.) Plaintiff appointed her husband, William Ferrell, as her healthcare agent and attorney-in-fact to make and communicate health care decisions as authorized in the document. (Advance Health Care Directive at p.2.) The document gives William Ferrell authority to act as her agent to make health care decisions on her behalf. (Id.) She also gives William Ferrell authority to execute documents necessary and desirable on her behalf to implement health care decisions. (Id. at p.4.) The document is signed by Plaintiff and two witnesses. (Id., at pp.5-6.)

Ms. Reyna provides a copy of the “RESIDENT-FACILITY ARBITRATION AGREEMENT” (hereinafter, “Arbitration Agreement”) that pertains to Plaintiff Kimberly Kyle. (Reyna Decl., ¶3, Ex. 2.) At the top of the page, it states in bold that residents are not required to sign the document as a condition of admission to the facility. The Arbitration Agreement states in relevant part:

Article 1. It is understood that any dispute as to medical malpractice, that is as to whether any medical services rendered under this contract were unnecessary or unauthorized or were improperly, negligently or incompetently rendered, will be determined by submission to arbitration as provided by California law, and not by a lawsuit or resort to court process except as California law provides for judicial review of arbitration proceedings. Both parties to this contract, by entering into it, are giving up their constitutional right to have any such dispute decided in a court of law before a jury, and instead are accepting the use of arbitration.

Article 2. It is further understood that any dispute between Resident and Imperial Care Center (Facility Name), its owners, operators, officers, directors, administrators, staff, employees, agents, and Longwood Management Corp. and any and all predecessors, successors in interest, and assigns (collectively referred to herein as “Facility”), including any action for injury or death arising from negligence, intentional tort and/or statutory causes of action (including all California Welfare and Institutions Code sections), will be determined by submission to binding arbitration as provided by California law, and not by lawsuit or resort to court process except as California law provides for judicial review of arbitration proceedings. All parties to this agreement are giving up their Constitutional right to have a dispute under this Agreement decided in a court of law before a jury, and instead are accepting the use of binding arbitration.

Article 3. … This Agreement is binding on all parties, including the Resident’s representatives, executors, family members, and heirs. The Resident’s representatives, agents, executors, family members, successors in interest and heirs who execute this Agreement below on the “Resident Representative/Agent Signature” line are doing so not only in their representative capacity for the Resident, but also in their individual capacity and thus agree that any claims brought individually by Resident’s representatives, agents, executors, family members, successors in interest and heirs are subject to binding arbitration.

(Arbitration Agreement, Art. 1 to 3.) The Arbitration Agreement invokes the Federal Arbitration Act. (Arbitration Agreement, Art. 7.) The Arbitration Agreement is signed by Defendants’ representative, Maria Brown (Admission), and by the Resident’s Representative/Agent William Ferrell on July 28, 2017. The line provided for the Resident is not signed by Decedent.

B. Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021

The parties do not dispute that the Arbitration Agreement is signed by Plaintiff’s agent, William Ferrell. Instead, Plaintiff argues in opposition that the Court cannot compel arbitration of this matter because 9 U.S.C. § 402 applies to this action as it involves sexual assault and harassment. In reply, Defendants argue that this section only applies to employment matters.

(a) In general.--Notwithstanding any other provision of this title, at the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute, … 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. § 402(a).) Section 401(1) defines “predispute arbitration agreement” as “any agreement to arbitrate a dispute that had not yet arisen at the time of the making of the agreement.” (9 U.S.C. § 401(1).) The language of the statutes does not include any limitation to this section nor do the sections specify that section 402 should only be applied in the employment context.

Defendants argue that the bill’s history (HR 4445, 168 Cong. Rec. S624, 2022 WL 413089) indicates that this was meant to be applied in the employment context. In this congressional record, there is a discussion about the applicability and breadth of the bill and whether it would destroy predispute arbitration agreements in all arbitration matters. (See e.g., 168 Cong. Rec. S624-01, 168 Cong. Rec. S624-01, S628 [“The good news about this legislation is all the clauses that people already signed in their employment contracts, even when they didn't know about it, will no longer be valid. So it not only affects the future but affects those who signed in the past.”]; see e.g., Murrey v. Superior Court of Orange County (Jan. 30, 2023) – Cal.Rptr.3d --, 2023 WL 1098156; Steinberg v. Capgemini America, Inc. (E.D. Penn., Aug. 16, 2022) 2022 WL 3371323[1].)

While the congressional record and the cases recently discussing sections 401 and/or 402 mention employment agreements, the language of the statute does not limit the Act to only employment contracts or work-related sexual assault claims. Rather, the language of the statute broadly applies to predispute arbitration agreements that “relate” to a sexual assault dispute or sexual harassment dispute. In this action, there is a predispute arbitration agreement between Plaintiff/resident and Defendants (facility). The allegations involved in this action “relate” to a sexual assault dispute. As such, the Act applies to Plaintiff’s claims regarding sexual harassment or sexual assault.

Next, Defendants argue that Plaintiff’s claims arose prior to March 3, 2022, which was the effective date of the Act. (See 9 U.S.C. § 401; Walters v. Starbucks Corp. (S.D.N.Y., Aug. 25, 2022, No. 22CV1907 (DLC)) 2022 WL 3684901, at *2 [“EFASASHA only applies, however, to a ‘dispute or claim that arises or accrues on or after the date of enactment of this act.’ EFASASHA § 3, 136 Stat. 28. EFASASHA was signed into law on March 3, 2022. Pub. L. 117–90.”]; Murrey, supra, 2023 WL 1098156 at *1 [stating that the Act does not apply retroactively].) Plaintiff alleges that Moya repeatedly contacted Plaintiff in a sexually offensive manner while she was an inpatient at ICC’s locked down facility from 2019 to 2022, and that she was actually raped on March 12, 2022. (Compl., ¶¶1, 19.) As such, claims for sexual harassment and sexual assault before March 3, 2022 will be subject to arbitration, but any claims for sexual harassment and sexual assault on or after March 3, 2022 (including the alleged rape on March 12, 2022) will be stayed pending arbitration.

The Court has reviewed the allegations of the complaint. The complaint generally alleges that the “sexual interaction” between Plaintiff and the staff was foreseeable and that Moya (the offending staff member) repeatedly contacted Plaintiff in a sexual manner and raped her. (Compl., ¶¶18-20.)

· The 1^st cause of action for elder/dependent adult abuse and neglect is regarding Defendants’ failure to provide services and activities to ensure the safety and well-being of Plaintiff, thereby allowing her to be raped. (Compl., ¶33.) Plaintiff alleges that Defendants failed to exercise due care and failed to prevent the sexual assault/rape and injuries she sustained. (Id., ¶37.) This cause of action relies entirely on Defendants’ alleged lack of care to Plaintiff regarding the sexual assault (as opposed to failure to provide care of Plaintiff’s basic needs, etc.). This cause of action sufficiently “relates to the sexual assault dispute or the sexual harassment dispute” as contemplated under section 402.

· The 2^nd cause of action for negligence alleges that Defendants negligently abandoned Plaintiff, causing her to experience violent personal injuries on March 12, 2022. (Compl., ¶61.) The 3^rd cause of action for professional negligence alleges that Plaintiff was under the care of Defendants starting July 19, 2017 for healthcare and nursing care services and that they abandoned her, causing her injuries. (Id., ¶¶67-69.) The 4^th cause of action for false imprisonment alleges that Moya restrained and raped Plaintiff and that Defendants failed to prevent the sexual assault on Plaintiff. (Id., ¶¶75-76.) The 6^th cause of action for IIED is regarding Moya’s sexual advances and sexually offensive contact of Plaintiff and Defendants’ hiring of a sexual predator, such that Plaintiff suffered extreme and emotional distress. (Id., ¶¶85-89.) In the 8^th cause of action for neglect, Plaintiff alleges that she was injured by Moya and Defendants’ neglectful conduct. (Id., ¶100.) In the 9^th and 10^th causes of action for negligent hiring and negligent control, Plaintiff alleges that Defendants failed to exercise reasonable care in hiring and controlling Moya, who they knew was sexually abusing Plaintiff. (Id., ¶¶103-105, 112-113.) In the 11^th cause of action for premises liability, Plaintiff alleges that Defendants were negligent in maintaining the premises by allowing Moya to engage in sexual misconduct with female patients. (Id., ¶123.) The 12^th cause of action for enhanced remedies is based on the prior causes of action. Similar to the above, the only allegations in the complaint are regarding Moya’s alleged sexual assault and rape of Plaintiff and Defendants/facility’s failure to prevent the sexual assault. As such, these causes of action too “relate to” a sexual assault or sexual harassment dispute.

· The 5^th cause of action for sexual battery and 7^th cause of action for violation of Civil Code, § 51.9 (sexual harassment in business, service, and professional relationships) are subject to the Act as well.

The scope of the Arbitration Agreement is sufficiently broad to cover these claims. The arbitration agreement contemplates arbitrating disputes as to medical malpractice (whether authorized or not) and any action for injury or death arising from negligence, intentional tort, and/or statutory causes of action (including all Welfare & Institutions Code sections). Thus, these causes of action fall within the scope of the Arbitration Agreement.

However, as discussed above, the 1^st to 12^th causes of action alleged against Defendants ICC Convalescent Corp., Longwood Management Corporation, and Imperial Care Center, LLC may proceed to arbitration for claims based on conduct occurring prior to March 3, 2022. Any claims based on conduct occurring on or after March 3, 2022, including the claim for the rape that allegedly occurred on March 12, 2022, would be stayed pending the outcome of the arbitration.

In the opposition brief, Plaintiff argues that the Arbitration Agreement is unconscionable and thereby unenforceable.

Plaintiff argues there are degrees of procedural unconscionability because the arbitration agreement was a contract of adhesion. However, the Arbitration Agreement states at the top of the page in bold: “Residents shall not be required to sign this arbitration agreement as a condition of admission to this facility.” (Mot., Ex. 2.) It further states: “This Agreement may be rescinded by written notice within thirty (30) days of signature.” (Id.) The signature portions are preceded by capitalized, red font statements that by signing the agreement, the parties are agreeing to arbitrate their claims. While Plaintiff argues that she was instructed to sign the agreement through her Guardian Ad Litem, there is no declaration from William Ferrell stating that he was forced to sign the agreement as a prerequisite for admitting Plaintiff as a resident to the facility.

Plaintiff also argues that the agreement was substantively unconscionable because the agreement was one-sided (i.e., the agreement precluded claims for collections and eviction by Defendants from arbitration) and that the Arbitration Agreement required the parties to split fees and expenses of arbitration. However, the language is not one-sided. The Arbitration Agreement requires both parties to submit certain claims to arbitration and equally allows the parties to file certain types of claims with the court. Further, Plaintiff argues without authority that the splitting of the costs of arbitration is “unfair.” (See e.g., CCP § 1284.2 [stating that unless the arbitration agreement states otherwise, parties to an arbitration will each pay their pro rata share of expenses and fees].)

For the reasons stated above, the Court finds that the Arbitration Agreement between Plaintiff and Defendants ICC Convalescent Corp., Longwood Management Corporation, and Imperial Care Center, LLC is valid and enforceable between these parties. Plaintiff’s claims in the complaint based on conduct occurring prior to March 3, 2022 shall be submitted to arbitration. The remainder of the claims, based on conduct occurring on or after March 3, 2022 shall be stayed pending the resolution of the action.

Defendants’ request that the Court remove this action from the civil active list pending the outcome of the arbitration is denied. The claims based on conduct occurring on or after March 3, 2022 (including the alleged rape claim) are stayed pending the resolution of the arbitration. Further, the Court notes that Defendants Comfort Care Hospice, Inc., Aveanna Healthcare, LLC, and Rafael Moya have not joined in the motion to compel arbitration and the motion was not brought against them. Plaintiff’s claims against these Defendants will also be stayed pending the outcome of the arbitration.

In light of the ruling on the motion to strike, Defendant Comfort Care Hospice, Inc.’s demurrer and motion to strike is taken off-calendar as the action is stayed. Comfort Care Hospice, Inc. may refile or request that the Court reinstate a hearing date for the demurrer and motion to strike once the stay has been lifted.

Defendants ICC Convalescent Corp., Longwood Management Corporation, and Imperial Care Center, LLC’s motion to compel Plaintiff to submit to arbitration is granted as to claims in the complaint based on conduct occurring prior to March 3, 2022 against these moving Defendants only. Any claims for damages based on conduct occurring on or after March 3, 2022 shall be stayed.

The Court sets and OSC re: Status of the Arbitration for August 16, 2023 at 8:30 a.m.

Defendant Comfort Care Hospice, Inc.’s demurrer and motion to strike portions of the complaint is taken off-calendar in light of the stay in this action.

[1] The Steinberg Court stated:

By passing the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA), Congress has begun to chip away at the breadth of the FAA. This significant act rightfully pulls back on the long-held presumption towards arbitration where sexual harassment is concerned. The EFAA provides that “at the election of the person alleging conduct constituting a sexual harassment dispute ... no predispute arbitration agreement ... shall be valid or enforceable with respect to a case which is filed under Federal [or] State law and relates to the ... sexual harassment dispute.” EFAA, Pub. L. No. 117-90, 136 Stat. 26 (2022) (codified at 9 U.S.C. § 402(a)). In doing so, the EFAA unequivocally ends the era of employers being able to unilaterally compel arbitration in sexual harassment cases. Unfortunately, the EFAA only applies to any “dispute or claim that arises or accrues on or after the date of the enactment of this Act,” and the EFAA was enacted on March 3, 2022. EFAA, Pub. L. No. 117-90, 136 Stat. 26 (2022) (codified at 9 U.S.C. § 402).

(Steinberg, supra, 2022 WL 3371323, at *2.)

Superior Court of California

County of Los Angeles

Department B