Judge: Mark A. Young, Case: 22SMCV02048, Date: 2023-10-17 Tentative Ruling
Case Number: 22SMCV02048 Hearing Date: October 17, 2023 Dept: M
CASE NAME: Coleman v. Bird
Rides Inc.
CASE NO.: 22SMCV02048
MOTION: Petition/Motion
to Compel Arbitration
HEARING DATE: 10/17/2023
Legal
Standard
Under California and federal law,
public policy favors arbitration as an efficient and less expensive means of
resolving private disputes. (Moncharsh
v. Heily & Blase (1992)
3 Cal.4th 1, 8-9; AT&T Mobility
LLC v. Concepcion (2011) 563 U.S. 333, 339.) Accordingly, whether an
agreement is governed by the California Arbitration Act (“CAA”) or the Federal
Arbitration Act (“FAA”), courts resolve doubts about an arbitration agreement’s
scope in favor of arbitration. (Moncharsh, supra, 3 Cal.4th at 9;
Comedy Club, Inc. v. Improv West
Assocs. (9th Cir. 2009) 553 F.3d 1277, 1284; see also Engalla v. Permanente Med. Grp., Inc.
(1997) 15 Cal.4th 951, 971-972 [“California law incorporates many of the basic
policy objectives contained in the Federal Arbitration Act, including a
presumption in favor of arbitrability [citation] and a requirement that an
arbitration agreement must be enforced on the basis of state law standards that
apply to contracts in general”].) “[U]nder both the FAA and California law,
‘arbitration agreements are valid, irrevocable, and enforceable, save upon such
grounds as exist at law or in equity for the revocation of any contract.’ ” (Higgins v. Superior Crout (2006) 140 Cal.App.4th 1238, 1247.)
“Code of
Civil Procedure section 1281.2 requires a trial court to grant a petition to
compel arbitration if the court determines that an agreement to arbitrate the
controversy exists.” (Avery v.
Integrated Healthcare Holdings, Inc. (2013) 218 Cal.App.4th 50, 59,
quotations omitted.) Accordingly, “when presented with a petition to compel
arbitration, the court’s first task is to determine whether the parties have in
fact agreed to arbitrate the dispute.” (Ibid.) A petition to compel arbitration is in essence a suit in equity
to compel specific performance of a contract. (Id. at 71.) As with any other specific performance claim, “a
party seeking to enforce an arbitration agreement must show the agreement’s
terms are sufficiently definite to enable the court to know what it is to
enforce.” (Ibid. [internal citations omitted].) “Only
the valid and binding agreement of the parties, including all material terms
well-defined and clearly expressed, may be ordered specifically performed.” (Ibid.) An arbitration agreement “must be so interpreted as to give
effect to the mutual intention of the parties as it existed at the time of
contracting, so far as the same is ascertainable and lawful.” (Civ. Code, §
1636.) The language of the contract governs its interpretation if it is clear
and explicit. (Civ. Code, § 1368.) If uncertainty exists, “the language of a
contract should be interpreted most strongly against the party who caused the
uncertainty to exist.” (Civ. Code, § 1654.)
The party
seeking to compel arbitration bears the burden of proving the existence of a
valid arbitration agreement by the preponderance of the evidence. (Engalla v. Permanente Medical Group, Inc.
(1997) 15 Cal.4th 951, 972.) It would then be plaintiff’s burden, in opposing
the motion, to prove by a preponderance of the evidence any fact necessary to her
opposition. (See Ibid.) “In these
summary proceedings, the 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.” (Ibid.)
Analysis
Valid Arbitration Agreement
Defendants
assert that the instant claims are required to go to arbitration because
Plaintiff signed an arbitration agreement covering their claims prior to her
rental and the alleged incident on the electric scooter that forms the basis of
her lawsuit.
As with any contract, mutual assent
or consent is necessary for the formation of a valid arbitration agreement.
(Civ. Code, §§ 1550, 1565.) “Consent is not mutual, unless the parties all
agree upon the same thing in the same sense.” (Civ. Code, § 1580.) The moving
party bears the initial burden of showing the existence of an agreement to
arbitrate by a preponderance of the evidence. (Mitri v. Arnel Mgmt. Co. (2007) 157 Cal.App.4th 1164, 1169
[“Because the existence of the agreement is a statutory prerequisite to
granting the petition, the petitioner bears the burden of proving its existence
by a preponderance of the evidence.”].)
Bird operates an on-demand personal
electric scooter sharing network. (Grubb Decl., ¶ 3.) Users can rent a Bird
scooter only by creating an account through the Bird Mobile Application (“Bird
App”) on their smartphones. (Id., ¶ 4.) Bird uses global positioning satellite
technology to determine the user’s location and to identify nearby scooters
that the user may rent. (Id., ¶ 5.) The user unlocks a scooter through the Bird
App and then rides the scooter. At the end of the ride, the user pays a scooter
rental fee through the Bird App. The scooter is then available for others to
rent. (Id., ¶ 6.)
The beginning of the Bird Rental
Agreement includes the following notice, written in capital letters and
boldface font, specifically calling out the Arbitration Agreement:
THIS AGREEMENT CONTAINS
RELEASES, DISCLAIMERS, AND ASSUMPTION-OF-RISK PROVISIONS AND A BINDING
ARBITRATION AGREEMENT THAT LIMIT YOUR LEGAL RIGHTS AND REMEDIES. FOR MORE
DETAILS, PLEASE REFER TO SECTIONS 9 AND 15 BELOW.
(Id. §1.)
Section 9 begins with the following
directive: “PLEASE READ THIS SECTION CAREFULLY – IT MAY SIGNIFICANTLY AFFECT
YOUR LEGAL RIGHTS, INCLUDING YOUR RIGHT TO FILE A LAWSUIT IN COURT.” (Grubb
Decl., Ex. A, §§ 9.) Section 9.2 then sets forth the parties’ agreement to
settle claims by binding arbitration:
[A]ll claims arising out of or
relating to use and rental of a Vehicle, this Agreement, and the parties’
relationship with each other shall be finally settled by binding arbitration…
administered by JAMS, or alternatively a mutually agreed upon arbitrator or
arbitration service, under the applicable commercial arbitration rules for JAMS
or the mutually agreed upon arbitration service, excluding any rules or
procedures governing or permitting class actions.
(Id., § 9.2.) Further, the Agreement provides a delegation
provision stating that “[t]he arbitrator, and not any federal, state or local
court or agency, shall have exclusive authority to resolve all disputes arising
out of or relating to the interpretation, applicability, enforceability or
formation of this Agreement, including . . . whether a claim is subject to arbitration.”
(Id.) Section 9.6 of the Bird Rental Agreement informs the user that he or she
may opt out of the Arbitration Agreement by providing notice to Bird within 30
days of the effective date of the Bird Rental Agreement or the user’s first
rental of a Bird scooter, whichever is later. (Id., § 9.6.) At no point in time
did Coleman opt out of the Bird Rental Agreement, and Bird has no record of
Coleman opting out of the Arbitration Agreement. (Grubb Decl. ¶ 22.)
Coleman contends that she does not
recall signing an arbitration agreement. Coleman confirms that she rented one
of Bird's scooters on November 5, 2020, the date of the subject incident, using
the Bird App on her iPhone 11 Pro Max, which had an approximately 6.5-inch
screen. (Coleman Decl., ¶ 2.) She recalls that the type viewed on her mobile
phone was very small and inconspicuous. (Id.) However, she has “no recollection
of scrolling through any terms and conditions before activating my account
though the mobile application. [She] did not electronically sign or initial any
term(s) related to arbitration. [Her] attention was not specifically drawn to
any significant terms and/or conditions in bold, underline, increased text size
or enhanced interface. The mobile application did not alert [her] to an
arbitration clause or require that [she] specifically assent to its provisions
by e-signing, initialing, or checking a box before using the scooter.” (Id.)
She also attests that, to the best of her recollection, the Bird App did not
request that she agree or reaffirm any agreement to arbitrate potential injury
claims on the date of the subject incident. (Id.)
Under the Uniform Electronic
Transactions Act, an electronic signature “is attributable to a person if it
was the act of the person. The act of the person may be shown in any manner,
including a showing of the efficacy of any security procedure applied to
determine the person to which the electronic record or electronic signature was
attributable.” (Civ. Code, § 1633.9(a).) The effect of such electronic
signature “is determined from the context and surrounding circumstances at the
time of its creation, execution, or adoption, including the parties’
agreement.” (Civ. Code, § 1633.9(b).)
In Ruiz, a
declaration seeking to authenticate the plaintiff’s electronic signature on an
arbitration agreement was deemed insufficient where the declarant “summarily
asserted” plaintiff electronically signed the agreement and “did not explain
how she arrived at that conclusion or inferred [plaintiff] was the person who
electronically signed the agreement” or that the electronic signature “was ‘the
act’” of the plaintiff. (Ruiz v.
Moss Bros. Auto Group, Inc. (2014) 232 Cal.App.4th 836, 844-845.) A supplemental
declaration, generally explaining the onboarding process, failed to explain that
all employees were required to use unique login ID and password when they
logged into the HR system and sign electronic forms and agreements; how an
electronic signature could only have been placed on the agreement by a person
using plaintiff’s “unique login ID and password;” or, how the declarant
otherwise ascertained how Ruiz's printed electronic signature came to be placed
on the agreement. (Id., at 845.) The court concluded that in “the face
of Ruiz's failure to recall electronically signing the 2011 agreement, the fact
the 2011 agreement had an electronic signature on it in the name of Ruiz, and a
date and time stamp for the signature, was insufficient to support a finding
that the electronic signature was, in fact, ‘the act of’ Ruiz.” (Id.) By contrast, in Espejo, the “declaration offered the critical factual
connection that the declarations in Ruiz lacked,” by detailing “security
precautions regarding transmission and use of an applicant’s unique username
and password, as well as the steps an applicant would have to take to place his
or her name on the signature line” of the agreement. (Espejo v. Southern California Permanente
Medical Group (2016) 246
Cal.App.4th 1047, 1062.)
Defendant’s proffered declaration
provides sufficient authentication of the onboarding process to demonstrate
that the electronic signature was the act of Plaintiff. At the time Plaintiff Coleman
signed up for the Bird App, users had to review and agree to the Bird Rental
Agreement, Waiver of Liability and Release as a part of the mandatory sign-up
process on the Bird App. (Id., ¶¶ 7–10, 12–15, Ex.
A.) A user cannot rent a Bird scooter without first downloading the Bird App
and creating an account. (Id., ¶ 11.) To create an account, a user must
enter their e-mail address and click the “RIDE” button. (Id., ¶ 12 & Ex.
B.) The following message appears directly above the “RIDE” button: “By clicking
‘RIDE,’ I confirm that I’m at least 18 years old, and I agree to Bird’s Terms
of Service and Privacy Policy.” (Id.) Both “Terms of Service” and “Privacy
Policy” are underlined clickable links that take the user to the respective
policy. (Id.) Upon verifying his or her e-mail address, the user must then
follow three steps to accept the Bird Rental Agreement. (Id., ¶ 14.) The user
must (1) scroll and read through the entirety of the Bird Rental Agreement,
which is displayed on the Bird App; (2) check two boxes confirming the
user’s acceptance of the terms and conditions set forth in the Bird Rental
Agreement, including certain highlighted sections; and (3) click the “I
AGREE” button at the end of the Bird Rental Agreement. (Id. & Ex. B.)
Defendant provides an image from the Bird App reflecting the check boxes and “I
AGREE” button. (Id., ¶ 15.) Users cannot unlock and rent a Bird scooter
without first accepting and agreeing to the Bird Rental Agreement, as the
scooter’s wheels remain disabled until completion. (Id.)
Bird captures certain information
that is automatically generated by each user’s signup process, including when
the user signs up and when the user accepts the Bird Rental Agreement. (Id., ¶
16.) When a user signs up to use the Bird Platform and clicks “I AGREE” at the
end of the Rental Agreement, that data is contemporaneously transmitted to Bird
and kept by Bird in the ordinary course of business to, among other things,
confirm that the user has expressly agreed to Bird’s terms and conditions
before riding a Bird scooter. (Id., ¶¶ 17–18, 20.) Per the information
automatically generated by Plaintiff Coleman’s sign-up process, Coleman
accepted and agreed to the Bird Rental Agreement on November 5, 2020, the date
of the subject incident. (Id., ¶ 19.) In doing so, she agreed to binding
arbitration of all claims arising out of her use of a Bird scooter. (Id., ¶ 8
& Ex. A.) Upon Coleman’s agreement, the Bird App generated a record of her
acceptance and tagged the Bird Rental Agreement that she accepted to her user
ID number. (Id., ¶ 20.)
Considering the totality of the
record, Defendant meets its burden to show that Plaintiff Coleman agreed to the
electronic terms and conditions. First, Coleman’s declaration is not persuasive.
She admits many facts that are consistent with Defendant’s evidence and
arguments. First, she declares that she signed up using the Bird App, submitted
personal information to make an account on the Bird App, and recalls that the
type was small and inconspicuous, but otherwise has “no recollection” of
scrolling through terms and conditions. If Plaintiff has no recollection of the
terms and conditions, then Plaintiff is also unable to affirm that she did not
sign the terms and conditions presented to her via the App. Further, this
contradicts her recollection that the text was small and inconspicuous. She
affirms that she did not “electronically sign or initial” any terms related to
arbitration. But the evidence of the signing process did not require her to
“sign or initial” any arbitration terms. Instead, the App required her to press
the “RIDE” button, check certain boxes regarding the Agreement, and click the “I
AGREE” button. Further, there is undisputed evidence that users cannot unlock a
bird scooter without agreeing to the terms and conditions presented by the Bird
App.
Plaintiff argues that the design of
the agreement's webpage and terms of use was not conspicuous enough to be put
on inquiry notice of the terms containing the arbitration agreement. Plaintiff
implies that she had trouble reading the terms of the agreement on her 6.5 inch
iPhone screen. The Court does not give heavy weight to this evidence. The terms
were not "buried at the bottom of the page” or “tucked away in obscure
corners of the website.” Instead, the record shows that the clickwrap agreement
was presented to Plaintiff in the center of the screen, in bold letters,
clearly delineated from the rest of the agreement. These terms, including terms
such as “RIDER ACCEPTANCE OF AGREEMENT” and “I certify that I have
read and expressly agree to the terms and conditions…”, etc., would put a
reasonable person on constructive notice that continued use will act as a
manifestation of the user's intent to be bound by the terms and conditions.
There is no
reasonable dispute that the claims here fall under the scope of the broad
arbitration provision. The clause would apply to the claims at hand involving
the operation and use of the Bird scooter. Accordingly, the Court finds that
there is an arbitration agreement between the parties that cover the claims
here.
Defendant meets its burden to
demonstrate the existence of an arbitration agreement between the parties that
covers Plaintiff’s claims. Plaintiff, in turn, fails to demonstrate that the
agreement is unconscionable. Defendant’s motion is therefore GRANTED and the
Court orders Plaintiff’s claims to arbitration, as discussed above. The entire
action is STAYED pending the completion of the arbitration. (CCP § 1281.4.)
The Court set a status conference
re arbitration for October 11, 2024, at 8:30 a.m.