Judge Margaret L. Oldendorf, Case 21BBCV00446 2022-10-24 Tentative Ruling

Judge: Margaret L. Oldendorf, Case: 21BBCV00446, Date: 2022-10-24 Tentative Ruling

This lawsuit contains a single cause of action under California’s Private Attorney General Act, Labor Code §§ 2698 et seq. (PAGA). Plaintiff Andrea Rodriguez (Rodriguez) alleges she was employed by Defendant Kan Di Ki, LLC (KDK) from January 2018 through January 2021. (Complaint, ¶24.) She alleges a variety of Labor Code wage and hour violations by KDK including failure to pay overtime, failure to provide legally sufficient meal periods and rest breaks, and others.

Before the Court is KDK’s motion to compel Rodriguez to arbitrate her PAGA claim on an individual basis, and to dismiss the representative PAGA claim. Rodriguez opposes the motion by challenging KDK’s evidence and asserting that she did not sign any arbitration agreement. This motion originally came on for hearing before Judge Kralik in Dept. B in the North Central District. Because KDK offered new evidence with its reply brief, Judge Kralik continued the hearing and ordered Rodriguez to file a sur-reply, “by September 26, 2022 by the end of the business day.” Rodriguez filed her sur-reply by September 26, 2022, but not until 7:49 p.m. Though this is after the close of business, the Court declines Rodriguez’s invitation to strike it.

Because KDK fails to provide admissible evidence of an arbitration agreement requiring Rodriguez to arbitrate her claims against KDK, the motion is denied.

When this lawsuit was filed in May 2021, it named as defendants five entities. In addition to KDK it named Trident Care, LLC, Trident HoldCo, LLC, Trident Holding Company, LLC, and TridentCare. In July 2021, an answer was filed by all five defendants. In March 2022, Rodriguez dismissed all defendants but KDK. Based on evidence recently placed before the Court, Rodriguez agreed to dismiss the other four defendants after KDK provided a declaration stating that it was Rodriguez’s only employer. (See Declaration of Joseph Jardine, person responsible for Human Resources at KDK, attached as Exhibit D to the Declaration of Won Christina Chang filed September 26, 2022.)

In connection with its motion to compel arbitration, KDK offered evidence that two months before filing this action, Rodriguez had filed a class action against these same five defendants. (Declaration of Jason Murtagh, ¶2 and Exhibit A thereto.) Murtagh declares that after providing Rodriguez’s counsel with the same arbitration agreements offered in support of the present motion, Rodriguez dismissed that action and filed the present PAGA-only lawsuit against Defendants. (Id. at ¶¶ 3-5.)

California Rules of Court, rule 3.1330 provides: “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.”

As mentioned, this motion was originally heard by Judge Kralik. His September 16, 2022 order contains rulings on evidentiary objections, and those ruling are incorporated herein. Specifically, the evidence offered in support of KDK’s motion includes the Declaration of Megan Moffett. Moffett declares that she is Senior Human Resources Business Partner for “TridentCare.” By the time of the hearing, however, the sole remaining defendant was KDK. Objections to the Moffett Declaration were sustained on the basis that she failed to provide a factual basis for her statements concerning KDK’s personnel records. As noted in the order, “Ms. Moffett has not explained her connection between working in Human Resources at TridentCare and how this would make her familiar with the employment process at KDK.” Thus, KDK had no admissible evidence supporting the existence of an arbitration agreement between Rodriguez and KDK.

With its reply brief, KDK filed a new declaration, that of Kiley Alberts. Rodriguez responded to this late evidence with objections that have merit. Kiley Alberts states that she is a “Human Resources Business Partner,” but does not identify the entity she works for. She states that she is familiar with the employment application policies and procedures of “Defendant,” without ever identifying who the defendant is. Alberts Declaration, ¶2. All objections based on lack of foundation and personal knowledge to the Alberts Declaration are therefore sustained. (Evid. Code §§403, 702.)

Written arbitration agreements are “valid, irrevocable, and enforceable” under both state and federal law, except where grounds exist for revocation of contract. Code Civ. Proc. §1281; 9 U.S.C. §2; Armendariz v. Foundation Health Psychare Services, Inc. (2000) 24 Cal.4th 83, 98.

“Under section 1281.2, a trial court must grant a motion or petition to compel arbitration only ‘if it determines that an agreement to arbitrate the controversy exists.’ [fn.2.] The court makes this determination in a summary process. (See § 1290.2.) ‘[T]he trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court's discretion, to reach a final determination.’ (Citation.)

“The burden of persuasion is always on the moving party to prove the existence of an arbitration agreement with the opposing party by a preponderance of the evidence: ‘Because the existence of the agreement is a statutory prerequisite to granting the [motion or] petition, the [party seeking arbitration] bears the burden of proving its existence by a preponderance of the evidence.’ (Citation.)” (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 164-165 (Gamboa).)

When a petition to compel arbitration is “filed and accompanied by prima facie evidence of a written agreement to arbitrate the controversy, the court itself determines whether the agreement exists and, if any defense to its enforcement is raised, whether it is enforceable.” (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413.) “[T]he facts are to be proven by affidavit or declaration and documentary evidence, with oral testimony taken only in the court’s discretion.” (Id. at 413-414.)

“Although ‘public policy favors contractual arbitration as a means of resolving disputes [...] that policy “ ‘ “does not extend to those who are not parties to an arbitration agreement, and a party cannot be compelled to arbitrate a dispute that he has not agreed to resolve by arbitration.” ’ ” ’ (Citation.)” (Gamboa, supra, 72 Cal.App.5th at 165-166.)

The first step in analyzing any motion to compel arbitration is to determine whether a written arbitration agreement in fact exists. KDK’s motion fails at this critical first step, as it has not offered admissible evidence of such an agreement between itself and Rodriguez.

Neither Moffett nor Alberts state sufficient foundational facts that would enable them to provide evidence about KDK’s hiring process and human resource records. Moffett states, “My title at TridentCare is Senior Human Resources Business Partner. I am familiar with the employment application policies and procedures for Kan Di Ki and I have substantial knowledge regarding the personnel files of Kan Di Ki employees.” Objections to this evidence were sustained as Moffett failed to provide facts linking up the statements regarding her employment with TridentCare to her familiarity with Kan Di Ki’s hiring process and business records. When faced with objections as to Moffett’s personal knowledge and the foundation for her declaration, KDK offered the Alberts Declaration. However, Alberts also fails to state that she was employed by KDK. Alberts declares that she is a resident of Pennsylvania, that her title is “Human Resource Business Partner,” and that she is “familiar with the employment application policies and procedures for Defendant.” Nowhere in the declaration does she identify who that is.

Putting aside for the moment that neither declarant stated she was employed by KDK, the records they proffer also fail to establish the existence of a written agreement to arbitrate as between Rodriguez and KDK. Exhibit B to the Alberts Declaration is a form agreement captioned, “Applicant’s Statement & Agreement.” The parties to the agreement are “Company” and Rodriguez (assuming the document is authentic). The word “Company” is not defined within the document. Exhibit C is an email from “Trident HR” to all employees regarding the implementation of a new multi-factor identification safeguard for access to UltiPro. The email is signed by TridentUSA Health Services. Exhibit D is a screenshot apparently indicating that Rodriguez acknowledged certain documents, including one labeled Dispute Resolution Agreement. And Exhibit E is a copy of a document captioned “TridentUSA Health Services Dispute Resolution Agreement.” This document provides the terms of an arbitration agreement between “Trident Holding Company, LLC (‘the Company’)” and “I.” Assuming it is meant to be acknowledged by all employees and assuming that there were admissible evidence that Rodriguez had acknowledged it, this agreement would only bind her to arbitration claims as to Trident Holding Company, LLC.

Trident Holding Company, LLC was dismissed because Joseph Jardine, the only declarant before the Court who states he is responsible for human resources at KDK, avers in relevant part as follows.

¶6 - “Trident Holding Company, LLC does not exist, and has not existed during the relevant time period to this matter, as a business entity within the State of California. Upon information and belief, neither Plaintiff nor any individual encompassed by Plaintiff’s Private Attorney General Act claims within the State of California between March 2, 2020 and the present were hired, managed, or terminated by Trident Holding Company, LLC.” (See Exhibit D to the Declaration of Won Christina Chan in Support of Plaintiff’s Opposition.)

Jardine makes the same representation as to each of the dismissed defendants. Consequently, even if the documents proffered by KDK through the declarations of Moffett and/or Alberts were admissible, the motion would fail as none of these is a contract between KDK and Rodriguez.[1]

[1] It should also be noted that KDK has asserted a 37^th affirmative defense in its Answer filed July 6, 2021 that states that none of the so-called “Trident” entities were Rodriguez’ employer; and in its 38^th affirmative defense, it states that none of the defendants are related to each other in any legal way.