Judge Kerry Bensinger, Case Number: 24STCV01883, Date: 2024-04-18 Tentative Ruling

MOVING PARTY: Defendants Decron Properties Corp. and Villa Cezanne Apartments

In 2020, Plaintiff Angela Pasquini (“Pasquini” or “Plaintiff”) was hired as a Residential Assistant Community Manager with Decron Properties Corp. (“Decron”). Pursuant to her employment, Pasquini lived and worked at the Ascent Apartments, which is owned by Villa Cezanne Apartments (“VCA”). Pasquini reported to Senior Community Manager Robin Sidenstecker (“Sidenstecker”) and Director Gino Cesario (“Cesario”). David Nagel is the CEO of Decron. Decron and VCA are joint employers.

On January 24, 2024, Pasquini filed a complaint against Defendants, Decron, VA, Sidenstecker, Cesario, and Nagel for:

7. Intentional Misrepresentation [Fraud], Negligent Misrepresentation and Concealment;

In short, Pasquini makes the following allegations: During Pasquini’s employment and tenancy at the Ascent Apartments, she made complaints to Defendants. Additionally, Pasquini developed medical conditions which caused her disability and entitled her to disability accommodation. However, Defendants refused to accommodate her. Pasquini also requested her annual performance review, which Defendants refused to provide. In retaliation for requesting a performance review and for needing to take disability leave, Defendants provided Pasquini with a false performance review claiming the report had been reviewed with her and that Pasquini’s performance was poor. Eventually, despite her good job performance, Defendants terminated Pasquini’s employment and evicted her.

On February 27, 2024, Decron and VCA (hereafter, “Defendants”) filed this Motion for an Order to Compel Arbitration and Stay the Action.

California law incorporates many of the basic policy objectives contained in the Federal Arbitration Act, including a presumption in favor of arbitrability. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 971-72.) Under both the FAA and California law, arbitration agreements are valid, irrevocable, and enforceable, except on such grounds that exist at law or equity for voiding a contract. (Winter v. Window Fashions Professions, Inc. (2008) 166 Cal.App.4th 943, 947.) The petitioner bears the burden of proving the existence of a valid arbitration agreement by a preponderance of the evidence, the party opposing the petition then bears the burden of proving by a preponderance of the evidence any fact necessary to demonstrate that there should be no enforcement of the agreement, and the trial court sits as a trier of fact to reach a final determination on the issue. (Rosenthal v. Great Western Financial Securities Corp. (1996) 14 Cal.4th 394, 413.) Pursuant to Code of Civil Procedure section 1281.2, the Court can compel parties to an arbitration agreement to arbitrate their dispute.

The party petitioning to compel arbitration under written arbitration agreement bears the burden of proving the existence of a valid arbitration agreement by a preponderance of the evidence, and party opposing petition must meet the same evidentiary burden to prove any facts necessary to its defense. The trial court acts as the trier of fact, weighing all the affidavits, declarations, and other documentary evidence. (Code Civ. Proc., § 1281.2; Provencio v. WMA Securities, Inc. (2005) 125 Cal.App.4th 1028, 1031.)

Plaintiff generally and throughout her opposition challenges the admissibility and authenticity of the Employment Agreement attached as Exhibit A to the Declaration of Rick Spade. The objection is overruled. In People v. Cruz, the Appellate Court stated:

“Authentication of a writing .... is required before it may be admitted in evidence. ([Evid. Code,] §§ 250, 1401.) Authentication is to be determined by the trial court as a preliminary fact ([Evid. Code,] § 403, subd. (a)(3)) and is statutorily defined [as relevant here] as ‘the introduction of evidence sufficient to sustain a finding that it is the writing that the proponent of the evidence claims it is’ .... (§ 1400.)” (People v. Goldsmith (2014) 59 Cal.4th 258, 266, 172 Cal.Rptr.3d 637, 326 P.3d 239 (Goldsmith).) “[W]hat is necessary is a prima facie case. ‘As long as the evidence would support a finding of authenticity, the writing is admissible.’ ” (Id. at p. 267, 172 Cal.Rptr.3d 637, 326 P.3d 239.)

Thus, a writing can be authenticated if its proponent adduces evidence sufficient to make a prima facie showing that the writing is what its proponent claims it is, or, in other words, that the writing is, “genuine for the purpose offered.” (Goldsmith, supra, 59 Cal.4th at p. 267, 172 Cal.Rptr.3d 637, 326 P.3d 239.) Conflicting inferences regarding the writing's authenticity go to the weight of the writing as evidence, not its admissibility. (Ibid.) “ ‘As long as the evidence would support a finding of authenticity, the writing is admissible. The fact conflicting inferences can be drawn regarding authenticity goes to the document's weight as evidence, not its admissibility.’ ” (People v. Valdez (2011) 201 Cal.App.4th 1429, 1435, 135 Cal.Rptr.3d 628.)

Except as provided by statute, the testimony of a subscribing witness is not required to authenticate a writing (Evid. Code, § 1411), and there are no limits on the means by which a writing may be authenticated. (Evid. Code, § 1410 [“Nothing in this article shall be construed to limit the means by which a writing may be authenticated or proved.”].) Rather, a writing may be authenticated by its contents and circumstantial evidence, including the testimony of witnesses other than the person or persons who created the writing or witnessed its creation. (Goldsmith, supra, 59 Cal.4th at p. 268, 172 Cal.Rptr.3d 637, 326 P.3d 239; People v. Landry (2016) 2 Cal.5th 52, 87, 211 Cal.Rptr.3d 160, 385 P.3d 327.)

Importantly, in Plaintiff’s Declaration, she admits to signing the documents. In fact, she states she was required to “complete and sign [the documents] on my first day of work.” She argues she did not have an opportunity to “read or review the documents before [she] signed them.” (Pasquini Decl., ¶ 5.) But she admits to signing them. Contrary to Plaintiff’s argument, Plaintiff admits to signing the documents.

Mr. Spade testified to the custom and practice of Decron’s personnel policies and procedures. Based upon his familiarity with the practices and procedures, he located the Employment Agreement in Plaintiff’s personnel file. Mr. Spade testified that typically Assistant Community Managers for Decron are provided with an employment contract. Exhibit A fits that description. All of the pages are initialed AP; page five is signed and dated and countered signed by Gino Cesario, from Decron; page seven is signed and dated; page 9 is signed and dated and Plaintiff’s name is also hand printed hand; Page 10 is signed and dated; page 11 is signed and dated; page 13 is signed and dated.

The hearsay objection to Exhibit A is overruled. (Jazayeri v. Mao (2009) 174 Cal.App.4th 301, 316 [“documents containing operative facts, such as the words forming an agreement, are not hearsay”]; People v. Jimenez (1995) 38 Cal.App.4th 795, 802; People v. Dell (1991) 232 Cal.App.3d 248, 261–262; Kepner-Tregoe, Inc. v. Leadership Software, Inc., (5th Cir. 1994) 12 F.3d 527, 540 [“Signed instruments such as wills, contracts, and promissory notes are writings that have independent legal significance, and are nonhearsay”].)

Pasquini separately raises ten (10) objections to the Declaration of Rick Spade and Exhibits A and B.[1] The objections are OVERRULED.

Defendants move to compel arbitration and stay the proceedings in this matter. In opposition, Plaintiff raises seven arguments which generally fall into the following categories: existence of the agreement, enforceability, and miscellaneous challenges. The court addresses each below.

Pasquini was employed with Decron as an Assistant Community Manager beginning on or about February 3, 2020. (Spade Decl., ¶ 4.) On February 3, 2020, Pasquini signed an Arbitration Agreement wherein she agreed to arbitrate any claims that arose out of her employment with Decron. (Rodriguez Decl., Exh. A.) The Agreement is between Pasquini and Decron. (Id.) Pursuant to the Arbitration Agreement, Pasquini and Decron agreed to “binding arbitration.” (Id.) Specifically, Pasquini and Decron voluntarily agreed that:

The Parties agree that any dispute that may arise in connection with, arising out of or relating to this Agreement, or any dispute that relates in any way, in whole or in part, to Employee's hiring by, employment with or separation from the Company, and its parent, subsidiary and affiliated corporations and entities, and their predecessors, successors and assigns, or any other dispute by and between the Parties, shall be submitted to binding arbitration, and not through litigation in court or a trial before a judge or jury. This arbitration obligation extends to any and all claims that may arise by and between the Parties, and expressly extends to, without limitation, claims or causes of action for wrongful termination, impairment of ability to compete in the open labor market, breach of an express or implied contract, breach of the covenant of good faith and fair dealing, breach of fiduciary duty, fraud, misrepresentation, defamation, slander, infliction of emotional distress, discrimination, harassment, retaliation, disability, loss of future earnings, trade secrets misappropriation, unfair competition, breach of fiduciary duty, breach of duty of loyalty, and claims under the California Constitution, the United States Constitution, and applicable state and federal fair employment laws, federal equal employment opportunity laws, and federal and state labor statutes and regulations, including, but not limited to, the Civil Rights Act of 1964, as amended, the Worker Retraining and Notification Act of 1988, as amended, the Americans With Disabilities Act of 1990, as amended, the Rehabilitation Act of 1973, as amended, the Employee Retirement Income Security Act of 1974, the California Labor Code, as amended, the California Business and Professions Code, as amended, the California Fair Employment and Housing Act, as amended, and all other state, federal and local laws and regulations, and contractual and common law claims (excluding workers' compensation, unemployment insurance claims or state or federal disability insurance claims, and claims under any other valid statute or law that expressly precludes arbitration of such claims).”

(Spade Decl., Exh. A, § 10(a).) Pasquini’s initials appear on each page of the employment agreement, including the page with the arbitration provision. (Id.) Pasquini signed the agreement. (Id.) Defendants have shown that a valid agreement to arbitrate exists.

Plaintiff offers three arguments in opposition. Each fail. The first challenge is procedural in nature. Plaintiff argues the motion should be denied because Defendants did not incorporate or state verbatim the terms of the arbitration agreement in the notice of motion. The argument relies on a misreading of California Rules of Court, rule 3.1330. Rule 3.1330 states, “A petition to compel arbitration or to stay proceedings pursuant to Code of Civil Procedure sections 1281.2 and 1281.4 must state, in addition to other required allegations, the provisions of the written agreement and the paragraph that provides for arbitration. The provisions must be stated verbatim or a copy must be physically or electronically attached to the petition and incorporated by reference.” There is nothing in Rule 3.1330 which requires that the terms of the arbitration agreement appear verbatim or by reference in the notice of motion. Defendants have attached a copy of the arbitration agreement to the Declaration of Rick Spade which was filed concurrently with the Motion. Defendants complied with Rule 3.1330.

Plaintiff next argues there is no agreement to arbitrate because she did not consent to arbitration. In support, Plaintiff offers her declaration where she denies agreeing to arbitrate any claims with Defendants, denies being told that any of the documents she was signing was an agreement to arbitrate, and denies being aware that an agreement to arbitrate existed between her and Defendants. (Pasquini Decl., ¶¶ 5-8.) However, the arbitration agreement bears Plaintiff’s initials and signature. Indeed, Plaintiff admits to signing the arbitration. (Pasquini Decl., ¶ 5.) Plaintiff cannot reasonably argue that she did not consent to arbitration. Moreover, a contract may still be enforced even if it is a contract of adhesion. Adhesion contracts are “fully enforceable . . . unless certain other factors are present which under established legal rules – legislative or judicial – operate to render it otherwise.” (Graham v. Scissor-Tail, Inc. (1981) 28 Cal.3d 807, 819; E.E.O.C. v. Luce, Forward, Hamilton & Scripps (9th Cir. 2003) 345 F.3d 742, 749 (employers may require employees to agree to binding arbitration of disputes as a condition of employment); Craig v. Brown & Root (2000) 84 Cal.App.4th 416, 421 (no procedural unconscionability found where plaintiff was told to review the company’s employee handbook and to acknowledge that he was bound by the policies contained within the handbook, which contained the arbitration policy).)

Finally, Plaintiff argues there is no admissible evidence of an arbitration agreement. For this argument, Plaintiff relies on objections to the Declaration of Rick Spade. The court considered her objections and overruled them. There exists a valid arbitration agreement. Further, there is no dispute the arbitration agreement is governed by the Federal Arbitration Act.[2]

“California law strongly favors arbitration. Through the comprehensive provisions of the California Arbitration Act (Code Civ. Proc., § 1280 et seq.), the Legislature has expressed a ‘strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution. As with the FAA (9 U.S.C. § 1 et seq.), California law establishes a presumption in favor of arbitrability. An agreement to submit disputes to arbitration “is valid, enforceable and irrevocable, save upon such grounds as exist for the revocation of any contract.” (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 125.)

Arbitration agreements may be declared unenforceable “upon such grounds as exist at law or in equity for the revocation of any contract. This saving clause permits agreements to arbitrate to be invalidated by ‘generally applicable contract defenses, such as fraud, duress, or unconscionability,’ but not by defenses that apply only to arbitration or that derive their meaning from the fact that an agreement to arbitrate is at issue.” (AT&T Mobility LLC v. Concepcion (2011) 563 U.S. 333, 339.)

Plaintiff raises two arguments against the enforceability of the arbitration provision: (1) the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (the “Act”) prohibits enforcement of the arbitration agreement, and (2) the agreement is unconscionable.

“In March 2022, President Joseph R. Biden signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the Act) (9 U.S.C. §§ 401, 402), representing the first major amendment of the Federal Arbitration Act (FAA) (9 U.S.C. § 1 et seq.) since its inception nearly 100 years ago.” (Murrey v. Superior Court (2023) 87 Cal.App.5th 1223, 1230.) “Section 402, subdivision (a), of the [EFAA] describes its applicability, stating that effective immediately, predispute arbitration agreements and joint-action waivers in the context of sexual assault or harassment were no longer valid or enforceable.” (Id. at p. 1234.) “[A]t the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute, or the named representative of a class or in a collective action alleging such conduct, 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, subd. (a).)” (Id. at pp. 1234-35.)

The parties disagree over whether the Act applies to Plaintiff’s claims. As framed by Plaintiff in her opposition, “Plaintiff’s sexual harassment claims accrued on or about May, 2022. Plaintiff never voluntarily agreed to arbitrate on the issue of sexual assault or sexual harassment. Therefore, the [Act] serves to bar Defendants’ attempt for arbitration and their motion must be denied.” (Opp., p. 5.) However, as Defendants correctly point out, the Complaint is bereft of any factual allegations of sexual assault or sexual harassment. Indeed, the Complaint does not state a claim based on sexual assault or sexual harassment. The Complaint alleges, “In addition to Defendants’ misconduct related to her tenancy, throughout her employ Plaintiff was subjected to Defendant EMPLOYER’s and MANAGERS’ discriminatory, harassing and retaliatory conduct including sexual harassment, based upon her sex, gender, age, medical conditions, disability, perceived disability and association with others.” (Complaint, ¶ 7.) This is the only mention of sexual harassment that appears in the FAC.

Defendants argue this allegation is conclusory. Defendants further argue that Plaintiff has not asserted a sexual harassment cause of action. However, Defendants do not provide any authority for the proposition that the court may disregard an allegation of sexual harassment, even if it is conclusory, to avoid application of the Act. Indeed, Defendants appear to concede that Plaintiff’s lone reference to sexual harassment in Paragraph 7 of the Complaint is sufficient to defeat arbitration as to that claim alone. Absent any authority, the court finds the Act applies to Plaintiff’s sexual harassment claim. Based upon the court’s review, and the parties’ discussion, it is unclear which, if any, of Plaintiff’s causes of action include or rest upon the alleged claim stated in paragraph 7 of the complaint. The court will hear from counsel.

Next Plaintiff raises the contractual defense of unconscionability. In general, the doctrine of unconscionability refers to “an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party.”¿ (Sonic-Calabasas A, Inc. v. Moreno (2013) 57 Cal.4th 1109, 1133 (Sonic) (cleaned up).) If unconscionable, the arbitration agreement is not a valid contract and therefore is unenforceable.¿ (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 114 (Armendariz).) ¿

“Unconscionability consists of both procedural and substantive elements. Procedural unconscionability addresses the circumstances of contract negotiation and formation, focusing on oppression or surprise due to unequal bargaining power. Substantive unconscionability pertains to the fairness of an agreement's actual terms and to assessments of whether they are overly harsh or one-sided.) Both elements must be present for a court to refuse to enforce an arbitration agreement. However, the elements do not need to be present in the same degree and are evaluated on a sliding scale. [T]he more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Magno v. The College Network, Inc. (2016) 1 Cal.App.5th 277, 284–285 (Magno) (cleaned up).)

¿ Procedural unconscionability has to do with matters relating to freedom of assent. (Kinney v. United Healthcare Servs. (1999) 70 Cal.App.4th 1322, 1329.) The procedural element focuses on two factors: oppression and surprise.¿ (Id.) “Oppression” arises from an inequality of bargaining power which results in no real negotiation and an absence of meaningful choice. (Id.) “Surprise” involves the extent to which the supposedly agreed-upon terms of the bargain are hidden in the printed form drafted by the party seeking to enforce the disputed terms. (Id.)¿¿

A “contract of adhesion” creates some amount of procedural unconscionability – the term signifies a standardized contract, which, imposed and drafted by the party of superior bargaining strength, relegates to the subscribing party only the opportunity to adhere to the contract or reject it. (Neal v. State Farm Ins. Cos. (1961) 188 Cal.App.2d 690, 694.) In addition, a lack of effort to highlight the presence of an arbitration provision, such as through bold lettering, larger font, or capitalization, has been found to indicate procedural unconscionability. (See Higgins v. Superior Court (2006) 140 Cal.App.4th 1238.)¿¿However, when there is no other indication of oppression other than the adhesive aspect of an agreement, the degree of procedural unconscionability is low. (Serpa v. California Surety Investigations, Inc. (2013) 215 Cal.App.4th 695, 704.)¿¿¿

“[T]he fact that the arbitration agreement is an adhesion contract does not render it automatically unenforceable as unconscionable. Courts have consistently held that the requirement to enter into an arbitration agreement is not a bar to its enforcement.” (Serafin v. Balco Properties Ltd., LLC (2015) 235 Cal.App.4th 165, 179 (Serafin); see also Concepcion, supra, at pp. 346-47 [“the times in which consumer contracts were anything other than adhesive are long past”].)¿

¿ First, Plaintiff argues the agreement is procedurally unconscionable because the agreement was drafted without input or review by Plaintiff, was presented on a take it or leave it basis, and Plaintiff was not given an opportunity to read or review it.¿ Based on the foregoing, the court finds that the arbitration agreement is a contract of adhesion. However, the court notes these factors are not sufficient to invalidate an arbitration agreement. (Brookwood v. Bank of America (1996) 45 Cal.App.4th 1667, 1674 [“ 'Reasonable diligence requires the reading of a contract before signing it. A party cannot use his own lack of diligence to avoid an arbitration agreement.' ”].) And, as explained above, the fact that it is an adhesion contract does not render it automatically unenforceable as unconscionable.

¿ Plaintiff next argues the arbitration agreement is procedurally unconscionable because she was not given the arbitration rules. “The failure to attach a copy of the arbitration rules could be a factor supporting a finding of procedural unconscionability where the failure would result in surprise to the party opposing arbitration.” (Lane v. Francis Capital Management LLC (2014) 224 Cal.App.4th 676, 690.)¿ In Lane, the Court concluded, “The failure to attach a copy of the arbitration rules could be a factor supporting a finding of procedural unconscionability where the failure would result in surprise to the party opposing arbitration.” (Id.) The Lane Court ultimately determined that “the failure to attach a copy of the AAA rules did not render the agreement procedurally unconscionable. There could be no surprise, as the arbitration rules referenced in the agreement were easily accessible to the parties—the AAA rules are available on the Internet.” (Id. at p. 691.)¿¿¿

¿ The court finds a low degree of procedural unconscionability. “[T]he less procedural unconscionability is present, the more substantive unconscionability is required to justify a determination.” (Dotson v. Amgen, Inc. (2010) 181 Cal.App.4th 975, 980 (Dotson).) Under the sliding scale approach, Plaintiff must therefore demonstrate a high degree of substantive unconscionability for the court to find the agreement unenforceable.

¿ Assessing substantive unconscionability, courts generally focus on the terms of the agreement and look for terms that are overly harsh or one-sided such that they shock the conscience. (Nyulassy v. Lockheed Martin Corp. (2004) 120 Cal.App.4th 1267, 1281 (Nyulassy); see also Sanchez v. Valencia Holding Co., LLC (2015) 61 Cal.4th 899, 910-911 (clarifying various definitions—e.g., “shocks the conscience,” “unduly oppressive,” “unreasonable favorable” mean same thing).) The “paramount consideration” is mutuality of the obligation to arbitrate. (Nyulassy, 120 Cal.App.4th at pp. 1281, 1287.)

“Substantively unconscionable terms may take various forms, but may generally be described as unfairly one-sided. One such form, as in Armendariz, is the arbitration agreement’s lack of a modicum of bilaterality, wherein the employee’s claims against the employer, but not the employer’s claims against the employee, are subject to arbitration. [Citation.] Another kind of substantively unconscionable provision occurs when the party imposing arbitration mandates a post-arbitration proceeding, either judicial or arbitral, wholly or largely to its benefit at the expense of the party on which the arbitration is imposed. [Citation.] In determining unconscionability, our inquiry is into whether a contract provision was unconscionable at the time it was made. [Citation.]” (Sonic, supra, 57 Cal.4th at pp. 1133-34 [cleaned up].) “To state it simply: it is substantively unconscionable to require a consumer to give up the right to utilize the judicial system, while imposing arbitral forum fees that are prohibitively high.” (Id. at pp. 1144-45.)

Here, Plaintiff points to four terms which she maintains are substantively unconscionable.

First, Plaintiff argues that the arbitration agreement impermissibly requires confidentiality. Plaintiff cites Ramos v. Superior Court (2018) 28 Cal.App.5th 1042 in support of the proposition that “provisions requiring all aspects of the arbitration be maintained in strict confidence is substantively unconscionable.” (Ramos, at p. 1067.) Ramos is distinguishable. In Ramos, the arbitration provision stated, “Except to the extent necessary to enter judgment on any arbitral award, all aspects of the arbitration shall be maintained by the parties and the arbitrators in strict confidence.” (Ramos, at p. 1065.)

Here, the arbitration agreement states: “Except as may be permitted by law as determined by the Arbitrator, neither a party nor an Arbitrator may disclose the existence, content, or results of any arbitration hereunder without the prior written consent of all parties.” (Spade Decl., Exh. A, § 10(i).) Unlike Ramos, the arbitration provision vests the arbitrator with the authority to determine whether, under the law, any aspect of the arbitration may be disclosed. Stated another way, Plaintiff is not foreclosed as in Ramos to conduct discovery to support her claims.

Second, Plaintiff argues the arbitration agreement impermissibly implies that Plaintiff must pay arbitration fees. “When an employer imposes mandatory arbitration as a condition of employment, the arbitration agreement or arbitration process cannot generally require the employee to bear any type of expense that the employee would not be required to bear if he or she were free to bring the action in court.” (Armendariz, supra, at pp. 110-111.) Plaintiff’s argument is flawed. Under applicable law, a plaintiff may be required to pay a portion of the arbitration costs. The cost simply cannot exceed the expenses that would be incurred in bringing an action in court. To the extent Plaintiff is arguing the arbitration agreement implies that she must bear prohibitively high costs, a review of the arbitration agreement does not favor that reading. Here, the arbitration provision states:

“The costs of arbitration, including the arbitrator's fees, shall be allocated and paid in accordance with then-applicable law. If required by applicable law, the Company shall pay all of the arbitrator's fees and the arbitration related costs. If, however, under applicable law, the Company is not required to pay all of the arbitrator's fees and/or the arbitration-related costs, such fees and costs will be apportioned between the parties by the arbitrator in accordance with applicable law and, if applicable law is silent on this issue, such arbitration fees and costs shall be allocated equally between the Company and Employee.”

Under the plain language of the provision, costs of arbitration are allocated in accordance with applicable law. As discussed, applicable law does not authorize Plaintiff “to bear any type of expense that the employee would not be required to bear if he or she were free to bring the action in court.” This provision is not substantively unconscionable.

Plaintiff next argues that the arbitration impermissibly restricts venue for the arbitration proceedings. The arbitration provision mandates “the location of the arbitration proceeding shall be in the city or county of the Company’s then-current headquarters.” (Spade Decl., Exh, A, § 10(j).) In support, Plaintiff cites Government Code section 12965 which allows an aggrieved person to bring an action “in any county in the state in which the unlawful practice is alleged to have been committed, in the county in which the records relevant to the practice are maintained and administered, or in the county in which the aggrieved person would have worked or would have had access to the public accommodation but for the alleged unlawful practice . . . .” (Gov. Code, §12965, subd. (c)(3).) The argument is unsupported. Plaintiff, who has the burden, does not show that Decron’s company headquarters is located in a county other than Los Angeles.

Last, Plaintiff argues that the agreement impermissibly requires her to waive her right to jury trial. By agreeing to the arbitration clause, absent a showing of unconscionability, Plaintiff agreed to proceed in an arbitral forum, not a court of law.

Plaintiff has not shown substantive unconscionability. Ultimately, determining whether an agreement is unconscionable requires evaluating “the totality of the agreement’s substantive terms as well as the circumstances of its formation to determine whether the overall bargain was unreasonably one-sided.” (Sonic, supra, 57 Cal.4th at p. 1146.)¿¿¿ Because both substantive and procedural components of unconscionability need to be present, Plaintiff has not shown the contract was unconscionable. “The two factors [of procedural and substantive unconscionability] are interrelated and are to be balanced in determining the enforceability of an arbitration provision.” (Dotson, supra, 181 Cal.App.4th at p. 980.) The court has balanced the factors. Viewed together, the court finds that the arbitration agreement is not unconscionable. The agreement is enforceable.

Plaintiff raises two additional arguments. First, she argues that VCA is a non-signatory to the arbitration agreement and therefore lacks standing to enforce it. Defendants argue that VCA (as well as Sidenstecker, Cesario, and Nagel) may enforce the arbitration agreement as Decron’s agents. The law favors Defendants’ position.

Under California law, non-signatories may enforce an arbitration agreement if they are agents or alter egos of a signatory party or third party beneficiaries of an arbitration agreement. “It is well established that a nonsignatory beneficiary of an arbitration clause is entitled to require arbitration.” (Harris v. Superior Court (1986) 188 Cal.App.3d 475, 478; see also Thomas v. Westlawke (2012) 204 Cal.App.4th 605, 614, 616.)

Here, Plaintiff alleges that VCA, Sidenstecker, Cesario, and Nagel are Decron’s agents. (Complaint, ¶ 27.) Further, the arbitration agreement expressly covers all of Plaintiff’s claims. It states, “any dispute that may arise in connection with, arising out of or relating to this Agreement, or any dispute that relates in any way, in whole or in part, to Employee’s hiring by, employment with or separation from the Company, ….” (Spade Decl., Exh, A, § 10(a).) VCA may enforce the arbitration agreement.

Second, Plaintiff argues that compelling her claims to arbitration when Sidenstecker, Cesario, and Nagel are not signatories to the agreement would lead to conflicting rulings. This argument fails because the court will order all of the parties to arbitration. Under the FAA, the parties must be directed to proceed to arbitration on issues as to which an arbitration agreement has been signed. (Los Angeles Unified Sch. Dist. v. Safety Nat'l Cas. Corp. (2017) 13 Cal.App.5th 471, 479.) The court will compel this action to arbitration.

The motion to compel arbitration is GRANTED, except as to the causes of action subject to Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act. The court intends to the stay the case as to all parties, including the case with respect to the Act, pending the conclusion of the arbitration. The Court sets a post-arbitration status conference for December 18, 2024, at 9:00 a.m.

Kerry Bensinger

Judge of the Superior Court

[1] There is no Exhibit B attached to Mr. Spade’s declaration.

[2] “This arbitration section of the Agreement shall be exclusively governed by and construed and enforced pursuant to the substantive and procedural provisions of the Federal Arbitration Act, 9 U.S.C. § 1 (“FAA”), and not individual state substantive and procedural laws regarding enforcement of arbitration agreements.” (Spade Decl., Exh. A, § 10(e).)