Judge: Joseph Lipner, Case: 23STCV21308, Date: 2024-02-27 Tentative Ruling

Case Number: 23STCV21308    Hearing Date: February 27, 2024    Dept: 72

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

Defendants Westlake Services, LLC (“Westlake”), Hankey Investment Company, LP (“Hankey Investment”), and Hankey Finance, Inc. (“Hankey Finance”) (collectively, “Defendants”) move for an order compelling Plaintiff Nishant Sharma (“Plaintiff”) to arbitrate his claims against Defendants and staying this action pending the outcome of arbitration.

The Court GRANTS Defendants’ motion.  The Court orders arbitration in accordance with the arbitration agreements submitted by Defendants as Exhibits A and B.  The Court stays this lawsuit pending arbitration and sets a status conference re arbitration for December 11, 2024 at 8:30 a.m.   

Background

This is an employment law case. Plaintiff filed this action on September 5, 2023, alleging a number of causes of action which stem from Plaintiff’s employment with Westlake. Plaintiff alleges that Defendants were integrated employers with interrelated operations, common management, and centralized control of labor operations. Plaintiff alleges that Defendants are alter-egos of each other.

Defendants contend that Plaintiff signed a number of arbitration agreements leading up to and during his employment with Defendants.

Defendants moved to compel arbitration on January 4, 2024. Plaintiff filed an opposition and Defendants filed a reply.

Evidentiary Objections

          The Court sustains Plaintiff’s evidentiary objections. Defendants have not provided foundation that Plaintiff executed the agreement attached as Exhibit C to the Feldmeth Declaration. Further, the signature that purports to be Plaintiff’s on Exhibit C does appear substantially different from Plaintiff’s signatures on Exhibits A and B.

Discussion

The Arbitration Provisions

Exhibit A

The “Employment Application” attached as Exhibit A to the Feldmeth Declaration provides that “I agree to submit to binding arbitration all disputes arising out of submission of this application. I also acknowledge that, in the event that I am hired by [Westlake], I will agree that all disputes … which might arise out of my employment with [Westlake], whether during or after that employment, will be submitted to binding arbitration.” (Feldmeth Decl., Ex. A at p. 4 [emphasis added].)

Plaintiff admits that he signed this agreement. Plaintiff also initialed the quoted clause.

Although Plaintiff correctly argues that the first sentence of this clause applies only to the job application process, the following sentence clearly applies to the general employment relationship, and therefore covers this dispute.

Exhibit B

The “Applicant’s Statement and Agreement” attached as Exhibit B to the Feldmeth Declaration provides that “[Plaintiff] and [Westlake] agree that any claim, dispute, and/or controversy that either party may have against another … arising from, related to, or having any connection whatsoever with [Plaintiff’s] seeking employment with or employment by, or other association with [Westlake] … shall be submitted to and determined exclusively by binding arbitration.” (Feldmeth Decl., Ex. B.)

Plaintiff admits that he signed this agreement. Plaintiff argues that this clause only applies to Plaintiff’s job application process, and not to any subsequent employment. Although the language is confusing to read, it appears that it only applies to the application process, and there is not a strong indication otherwise.

Third-Party Beneficiaries

Plaintiff contends that Hankey Investment and Hankey Finance cannot enforce the arbitration agreements as beneficiaries because the agreements were only with Westlake.

“There are, however, exceptions to the general rule that a nonsignatory cannot invoke an agreement to arbitrate, without being a party to the arbitration agreement.” (Thomas v. Westlake (2012) 204 Cal.App.4th 605, 614 [internal citation and quotation marks omitted; cleaned up].) “One such exception provides that when a plaintiff alleges a defendant acted as an agent of a party to an arbitration agreement, the defendant may enforce the agreement even though the defendant is not a party thereto.” (Ibid.)

Here, Plaintiff alleges that all of the Defendants were joint employers and were agents and alter-egos of each other. (Complaint at p. 3:6-11.) Thus, the Hankey defendants may assert the arbitration agreements as third-party beneficiaries.

Exhibit C

The Court does not enforce the arbitration provision in Exhibit C on this record.  The “opt out” information provided by Defendants (see Feldmeth Decl. ¶¶ 20-23) is not sufficient to authenticate the provision or to demonstrate agreement by Plaintiff under the facts of this case.  The Court therefore does not reach the question of whether the arbitration agreement in Exhibit C is unconscionable.

The Dispute Resolution Agreements

For the same reasons discussed under Exhibit C, it is not necessary to reach the question of whether the Dispute Resolution agreements are binding, because Exhibit A already provides for binding arbitration.