Judge: Kevin C. Brazile, Case: BC623542, Date: 2023-02-07 Tentative Ruling

Hearing Date: February 7, 2023

Case Name: Salinas v. Hof’s Hut Restaurants, Inc., et al.

Case No.: 22STCV19043

Matter: Motion to Compel Arbitration 

Moving Party: Defendant Hof’s Hut Restaurants, Inc.

Responding Party: Plaintiff Nancy Salinas

Notice: OK

Ruling: The Motion to Compel Arbitration is denied.

Moving party to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LACourtConnect rather than in person due to the COVID-19 pandemic. 

This is a PAGA action.  Defendant Hof’s Hut Restaurants, Inc. seeks to compel arbitration of this matter based on an arbitration agreement executed by Plaintiff Nancy Salinas at the start of her employment.  Defendant contends that “[a]s the United States Supreme Court explained in Viking River Cruises, where, as here, a plaintiff is subject to a bilateral arbitration agreement governed by the FAA, the plaintiff must proceed to individual arbitration on the plaintiff’s own PAGA claims and any representative, nonindividualized PAGA claims (i.e., the PAGA claims of the other allegedly aggrieved employees) must be dismissed.”

Plaintiff opposes the Motion on the grounds that (1) the existence of an arbitration agreement has not been shown; (2) the purported agreement “carves out” PAGA claims; (3) the agreement is unconscionable; and (4) Plaintiff does not lose standing if compelled to arbitrate her individual PAGA claim.  

The subject agreement states in relevant part, “Any controversy, dispute or claim between you and the Company, or its officers, agents or other team members, with the exception of any claim made pursuant to the California Private Attorney General Act, shall be settled by binding arbitration, at the request of either party, provided however that team members and the Company may only bring claims against each other in their individual capacity and not as a class representative or class member in any purported class or representative proceeding. Arbitration shall be the exclusive method for resolving any dispute or claim covered by this section of the Handbook . . . .”

Here, the waiver of a representative claim under the PAGA is void.  (Viking River Cruises, Inc. v. Moriana (2022) 142 S.Ct. 1906, 1924–25,) [“The agreement between Viking and Moriana purported to waive ‘representative’ PAGA claims. Under Iskanian, this provision was invalid if construed as a wholesale waiver of PAGA claims. And under our holding, that aspect of Iskanian is not preempted by the FAA . . . .”]; Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 384 [“We conclude that where, as here, an employment agreement compels the waiver of representative claims under the PAGA, it is contrary to public policy and unenforceable as a matter of state law.”].)

While arbitration of individual PAGA claims would ordinarily be contemplated under Viking River, the subject agreement specifically excludes PAGA claims of any kind.  (See supra.)  

Because the subject arbitration agreement does not encompass Plaintiff’s claim, the Motion to Compel Arbitration is denied.

Moving party to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LACourtConnect rather than in person due to the COVID-19 pandemic.