Judge: Latrice A. G. Byrdsong, Case: 24STLC01853, Date: 2024-06-04 Tentative Ruling
Case Number: 24STLC01853 Hearing Date: June 4, 2024 Dept: 25
Hearing Date: Tuesday, June 4, 2024
Case Name: VINCENT
UNUORAKPOR vs. EBAY INC.; and DOES 1 through 20, inclusive
Case No.: 24STLC01853
Motion: Motion to Compel Arbitration and
Stay Proceedings
Moving Party: Defendant
eBay Inc. (“Defendant” or “eBay”)
Responding Party: Plaintiff Vincent Unuorakpor
Notice: OK
Tentative Ruling: Defendant’s Motion to Compel
Arbitration is GRANTED, and the Court STAYS this action pending the completion
of arbitration.
Post
Arbitration Status Conference is set for December 4, 2024 at 9:30 a.m. in
Department 25 of the Spring Street Courthouse.
Counsel
are ordered to electronically file a JOINT Report Re: Status of Arbitration Proceedings (5) court days prior to
12/04/2024.
The
09/12/2025 Trial is advanced to this date and hereby taken off calendar /
vacated.
BACKGROUND
This
action arises from the alleged wrongful sharing of the personal information of
Plaintiff Vincent Unuorakpor (“Plaintiff”) by Defendant eBay Inc. (“Defendant”),
which Plaintiff alleges occurred due to his use of Defendant’s online
marketplace and services. Plaintiff alleges that Defendant failed to secure his
personal information. (Complaint, ¶ 16.)
On March
15, 2024, Plaintiff filed a Complaint against Defendant and DOES 1 through 20,
inclusive, alleging the following causes of action: (1) Negligence; (2) Violation
of the California Consumer Privacy Act; (3) Breach of Implied Contract; (4)
Breach of Contract; and (5) Violation of California Consumer Legal Remedies
Act.
On April
18, 2024, Defendant filed and served the instant Motion to Compel Arbitration
and Stay Proceedings. Defendant requests an order compelling arbitration of the
dispute and staying the litigation pending the outcome of arbitration.
Defendant’s notice of motion sets forth a June 1, 2024 hearing date on the
motion.
On May
15, 2024, Plaintiff filed an ex parte application to continue the
hearing date on Defendant’s motion to compel arbitration “filed on April 18,
2024 . . . from June 4, 2024, to any date after July 3, 2024, or any date
convenient with the Court’s calendar, and sufficient for Plaintiff to obtain
information to oppose” the motion to compel arbitration. (05/15/24 Ex Parte
Application at p. 2:3-6.)
Also, on
May 15, 2024, Defendant filed and served an Amended Notice of Motion which set
forth the correct June 4, 2024 hearing date on Defendant’s motion to compel
arbitration.
On May
16, 2024, after reviewing and considering the moving papers, the Court denied Plaintiff’s
ex parte application. (05/16/24 Minute Order.) The Court informed
Plaintiff that he “may file opposition to Defendant’s Motion to Compel
Arbitration pursuant to statutory Code.” (05/16/24 Minute Order.)
On May
21, 2024, Plaintiff filed an opposition to the motion to compel arbitration, to
which Defendant filed a reply brief on May 28, 2024.
MOVING PARTY
POSITION
Defendant
argues that the Federal Arbitration Act (the “FAA”), Utah law, and to the
extent applicable, the California Arbitration Act (“CAA”), require enforcement
of the arbitration agreement. Defendant argues that the User Agreement covers
the claims at issue in this lawsuit and that this action must be stayed pending
the completion of arbitration.
Plaintiff
argues that the Court lacks jurisdiction to hear Defendant’s motions to compel
arbitration, both motions should be stricken, a continuance of the hearing is
necessary to afford him the opportunity to receive and rely on evidence needed
to oppose the motion to compel arbitration, and the scope of the arbitration
clause in Defendant’s User Agreement does not cover issues unrelated to
services provided by Defendant.
REPLY
On reply,
Defendant asserts that Plaintiff does not dispute that he entered into a valid
and binding arbitration agreement with Defendant and that Plaintiff fails to
show his claims are not encompassed by the parties’ valid arbitration
agreement. Defendant contends that the Court has jurisdiction to hear its
motion and there are no grounds to strike its motion. Defendant argues that Plaintiff’s
discovery requests are improper and irrelevant to Defendant’s motion.
ANALYSIS
I. Compelling
Arbitration and Staying the Action
A.
Legal Standard
“A party who claims that there is a
written agreement to arbitrate may petition the superior court for an order to
compel arbitration” pursuant to California Code of Civil Procedure section
1281.2. Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal.App.4th
348, 356. “California law, like federal law, favors enforcement of valid
arbitration agreements.” Armendariz v. Foundation Health Psychcare Services,
Inc. (2000) 24 Cal.4th 83, 97. “On petition of a party to an arbitration
agreement alleging the existence of a written agreement to arbitrate a
controversy and that a party to the agreement refuses to arbitrate that
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, unless it determines that: (a) The right to compel
arbitration has been waived by the petitioner; or (b) Grounds exist for
rescission of the agreement.” (Code Civ. Proc. § 1281.2.) Parties may be
compelled to arbitrate a dispute upon the court finding that: (1) there was a
valid agreement to arbitrate between the parties; and (2) said agreement covers
the controversy or controversies in the parties’ dispute. Omar v. Ralphs
Grocery Co. (2004)¿118 Cal.App.4th 955, 961.
A party opposing a petition to compel
arbitration “bears the burden of proving by a preponderance of the evidence any
fact necessary to its defense.” Banner Entertainment, Inc. v. Superior
Court, supra, 62 Cal.App.4th 348, 356. Where a petition to compel
arbitration is granted, a court “shall, upon motion of a party to such action
or proceeding, stay the action or proceeding until an arbitration is had in
accordance with the order to arbitrate or until such earlier time as the court
specifies.” (Code Civ. Proc. § 1281.4.)
The Federal
Arbitration Act (“FAA”) applies to any contract evidencing a transaction
involving interstate commerce which contains an arbitration clause. Wolls v.
Superior Court (2005) 127 Cal.App.4th 197, 211. Section 2 of the FAA
provides that arbitration provisions shall be enforced, save upon grounds as
exist at law or in equity for the revocation of any contract. Ibid. A
state court may refuse to enforce an arbitration clause on the basis of
generally applicable contract defenses, such as fraud, duress, or
unconscionability. Ibid. A state court, however, may not defeat an
arbitration clause by applying state laws applicable only to arbitration
provisions. Ibid.
For the FAA to apply, a contract must involve interstate commerce. Ibid.
When it applies, the FAA preempts any state law rule that stands as an obstacle
to the accomplishment of the FAA’s objectives. Carbajal v. CWPSC, Inc.
(2016) 245 Cal.App.4th 227, 238. A party asserting FAA preemption bears the
burden to present evidence establishing a contract with the arbitration
provision affects interstate commerce, and the failure to do so renders the FAA
inapplicable. Ibid. Evidence must be presented, in the form of
declarations or other evidence, that establishes that the contract affects
interstate commerce. Ibid.
“[S]ince arbitration is a matter of contract, the FAA also applies if it is so
stated in the agreement.” Davis v. Shiekh Shoes, LLC (2022) 84 Cal.App.5th
956, 963.
“If a court of competent jurisdiction . . . has ordered arbitration of
a controversy which is an issue involved in an action or proceeding pending
before a court of this State, the court in which such action or proceeding is
pending shall, upon motion of a party to such action or proceeding, stay the
action or proceeding until an arbitration is had in accordance with the order
to arbitrate or until such earlier time as the court specifies.” (Code Civ.
Proc., § 1281.4.)
B. Discussion
In support of the motion, Defendant’s
counsel, Niccolas Conlin (“Conlin”), provides a declaration. Mr. Conlin
declares the following: Defendant operates a global online marketplace that
allows users to offer, sell, and buy just about anything in a variety of
pricing formats and locations. (Conlin Decl., ¶ 4.) The actual contract for
sale is between the seller and the buyer. (Conlin Decl., ¶ 4.) To register an
eBay account, a potential user must agree to comply with the terms of the eBay
User Agreement, the eBay Privacy Policy, and every other policy posted on
Defendant’s website. (Conlin Decl., ¶ 5.) The User Agreement and other policies
set out the terms pursuant to which eBay offers its services. (Conlin Decl., ¶ 5.)
The registration process in 2015 was identical to the current registration
process in all material aspects, which requires a prospective user to agree to
the User Agreement and read Defendant’s User Privacy Notice. (Conlin Decl., ¶¶ 8-11;
Exh. 1.) While use of the eBay site is voluntary, acceptance of the User
Agreement is and has always been mandatory for a prospective user to create an
eBay account. (Conlin Decl., ¶ 12.)
Plaintiff registered as an eBay user
and agreed to eBay’s User Agreement and Privacy Policy on November 23, 2015.
(Conlin Decl., ¶ 13; Exh. 2.) The eBay User Agreement that Plaintiff accepted to
register the account includes an arbitration agreement and class action waiver,
which are specifically called out in bold print. (Conlin Decl., ¶¶ 15-16; Exh.
2.) The User Agreement allows users to opt out of the arbitration agreement by
mailing Defendant a written opt-out notice within 30 days of accepting the User
Agreement for the first time. (Conlin Decl., ¶ 17; Exh. 2.)
1. Plaintiff’s
Procedural Arguments
Initially, the Court will address
Plaintiff’s procedural arguments raised in the opposition that the motions are
improper and should be stricken. The Court finds that Plaintiff’s contention
that Defendant filed two motions to compel arbitration is incorrect. Defendant
has only filed one motion to compel arbitration. Following the filing and
service of the motion, Defendant filed an Amended Notice of Motion which
corrected a typographical error in the notice of motion which set forth a June
1, 2024 hearing date instead of the actual hearing date of June 4, 2024.
A notice of motion must set forth
“[t]he date, time, and location, if ascertainable, of any scheduled hearing and
the name of the hearing judge, if ascertainable . . . .” (Cal.. Rules of Court,
Rule 3.1110(b)(1).) “[A]ll moving and supporting papers shall be served and
filed at least 16 court days prior to the hearing.” (Code Civ. Proc., § 1005,
subd. (b).)
The
Court rejects Plaintiff’s contention that the Court lacks jurisdiction to hear
the instant motion. The instant motion was filed and served on April 16, 2024,
which is more than 16 court days prior to the hearing. Defendant set forth an
incorrect hearing date on the initial notice of motion, which Defendant
corrected through the filing and service of the Amended Notice of Motion on May
15, 2024. Thus, despite Plaintiff’s contentions to the contrary, Defendant has
complied with CCP § 1005(b) and Cal. Rules of Court Rule 3.1110(b)(1). The
Court therefore rejects Plaintiff’s argument that the Court lacks jurisdiction
to hear the motion. The Court also rejects Plaintiff’s request to strike the
motion and amended notice of motion.
The
Court acknowledges that the motion initially set forth an incorrect hearing
date, which was ultimately corrected by the filing of the Amended Notice of
Motion. To the extent that Plaintiff argues he was prejudiced by the incorrect
hearing date, the Court does not find such contention persuasive. First,
Plaintiff acknowledged the correct June 4, 2024 hearing date when he filed his ex
parte application to continue the hearing date on the motion to compel.
Moreover, Plaintiff was allotted more time to oppose the instant motion given
that the hearing date set forth on the initial notice of motion was June 1,
2024 and the Amended Notice of Motion set forth the operative June 4, 2024
hearing date.
The
Court does not see due process concerns given that Defendant filed and served
an amended notice of motion which corrected a typographical error as to the
date of the hearing. The Court will consider the motion on its merits and will
not strike or deny the motion on procedural grounds.
The User
Agreement contains an arbitration agreement which provides that “except to the extent
inconsistent with or preempted by federal law, the laws of the State of Utah,
without regard to principles of conflict of law, will govern the User Agreement
and any claims or dispute that has arisen or may arise between [Plaintiff] and
[Defendant], except as otherwise stated in the User Agreement.” (Conlin Decl.,
Exh. 2 at p. 7.) The User Agreement states that Plaintiff and Defendant “agree
that any and all disputes or claims that have arisen or may arise between
[Plaintiff] and [Defendant] relating in any way to or arising out of this or
previous versions of the User Agreement, [Plaintiff’s] use of or access to
[Defendant’s] Services, or any products or services sold, offered, or purchased
through [Defendant’s] Services shall be resolved exclusively through final and
binding arbitration, rather than in court.” (Id.) The arbitration will
be conducted by the American Arbitration Association. (Id. at p. 8.) The
User Agreement explicitly provides that the FAA will govern the enforcement and
interpretation of the User Agreement. (Id. at p. 7.)
3. Appropriateness
of Compelling Arbitration
Initially,
the Court notes that the User Agreement provides that Utah law applies to the
User Agreement. Under Utah law, “[t]wo or more parties may agree in writing to
submit to arbitration . . . any controversy existing between them at the time
of the agreement . . . or they may agree to submit to arbitration any
controversy which may arise in the future.” Allred v. Educators Mut. Ins.
Ass’n of Utah (1996) 909 P.2d 1263, 1265. Utah law “favors arbitration as a
speedy and inexpensive method of adjudicating disputes.” Robinson &
Wells, P.C. v. Warren (1983) 669 P.2d 844, 846. “An agreement contained in
a record to submit to arbitration any existing or subsequent controversy
arising between the parties to the agreement is valid, enforceable, and
irrevocable except upon a ground that exists at law or in equity for the
revocation of a contract.” (U.C.A. 1953 § 78B-11-107(1).) “The court shall
decide whether an agreement to arbitrate exists or a controversy is subject to
an agreement to arbitrate.” (U.C.A. 1953 § 78B-11-107(2).)
Plaintiff
does not challenge the validity of the agreement to arbitrate or challenge
Defendant’s argument that the FAA and Utah law require enforcement of the
arbitration agreement. The Court finds that Plaintiff has conceded to such
points of argument because “[c]ontentions are waived when a party fails to
support them with reasoned argument and citations to authority.” Moulton
Niguel Water Dist. v. Colombo (2003) 111 Cal.App.4th 1210, 1215. Plaintiff
presents no evidence to dispute the validity of the arbitration agreement.
The
Court finds that Defendant has shown the existence of an agreement to arbitrate
and that the claims at issue are covered by the agreement to arbitrate. Here,
the Complaint arises from Plaintiff’s use of Defendant’s online marketplace and
services. As such, the claims alleged in the Complaint are covered by the
arbitration agreement. Moreover, the Court finds that the FAA applies as the
User Agreement explicitly states that it will apply.
Although
not relevant, even if California law were to apply, Defendant would have made a
showing of the existence of a valid agreement to arbitrate and that the User
Agreement covers the claims alleged in the Complaint. As stated above,
Plaintiff presents no evidence to rebut the validity of the User Agreement.
4. Plaintiff’s
Request for a Continuance
Plaintiff
argues that a continuance of the hearing on the instant motion is necessary so
that Plaintiff can receive and rely on evidence needed to oppose Defendant’s
motion.
“[A]
court has inherent power to control the course of litigation before it.” Rapid
Transit Advocates, Inc. v. Southern California Rapid Transit Dist. (1986) 185
Cal.App.3d 996, 1003. “The court has authority to grant continuances at any
stage of the proceeding upon a showing of good cause.” Ibid.
Initially,
the Court finds that Plaintiff’s reliance on Frazee v. Seely (2002) 95
Cal.App.4th 627 is inapposite to support his request for a continuance as
such case addressed a continuance request in the specific context of a motion
for summary judgment. Plaintiff requests a continuance of the hearing on the
motion because he believes that some or all of the claims in this a case are
not subject to arbitration by Defendant’s February 25, 2023 e-mail, which Plaintiff
argues demonstrates that the unknown Doe defendants handled inventories and the
handling of inventories does not fall within the scope of the services provided
by Defendant and cannot be subject to the arbitration clause in the User
Agreement. (Unuorakpor Decl., ¶ 9; Exh. A.) Plaintiff seeks to conduct
discovery to obtain information about the relationship between the Doe defendants
and Defendant. (Id., ¶¶ 10-12; Exhs. C-D.)
The
Court fails to see why discovery is warranted to oppose the instant motion
given that: (1) Plaintiff does not oppose the existence of the arbitration
agreement; and (2) Plaintiff does not oppose the validity of the arbitration
agreement. The Complaint clearly arises from the use of Defendant’s online
marketplace and services, which comes within the scope of the User Agreement
and the arbitration agreement set forth therein.
Thus,
Plaintiff’s causes of action asserted in the Complaint all come within the
scope of the User Agreement. The Court therefore DENIES Plaintiff’s request for
a continuance as the Court finds that Plaintiff has not shown good cause to
warrant a continuance.
Where an
action is compelled to arbitration under the FAA, the FAA provides for a stay
of proceedings pending the completion of arbitration. Gilmer v.
Interstate/Johnson Lane Corp. (1991) 500 U.S. 20, 25. Under Utah law, “[i]f
the court orders arbitration, the court on just terms shall stay any judicial
proceeding that involves a claim subject to the arbitration.” (U.C.A. 1953 §
78B-11-108(7).) Here, the Court has a basis to compel arbitration under the FAA
and Utah law. Although not applicable to the instant motion, under California
law, the Court would have a basis to compel arbitration.
II. Conclusion
The Court GRANTS Defendant’s Motion
to Compel Arbitration.
The Court STAYS
this action pending the completion of arbitration pursuant to the User Agreement
between the parties.
Post Arbitration Status Conference is set for December 4,
2024, at 9:30 a.m. in Department
25 of the Spring Street Courthouse.
Counsel are ordered to electronically file a JOINT Report
Re: Status of Arbitration
Proceedings (5)
court days prior to 12/04/2024.
The 09/12/2025 Trial is advanced to this date and hereby
taken off calendar / vacated.
Moving party is ordered to give
notice and to attach a copy of the Court's Tentative Ruling, as an
exhibit to said notice, as the order of the Court.