Judge: Maurice A. Leiter, Case: 24STCV03550, Date: 2024-06-27 Tentative Ruling

Case Number: 24STCV03550    Hearing Date: June 27, 2024    Dept: 54

Hearing Date: June 27, 2024

Department 54, Judge Maurice A. Leiter

Motion to Compel Arbitration

Moving Party: Defendants Aerotek, Inc. and Duluth Services, Inc., joined by Defenant TABC, Inc.

Responding Party: Plaintiff Devin Stewart

T/R:     DEFENDANTS’ MOTION TO COMPEL ARBITRATION IS GRANTED.

THE ACTION IS STAYED.

DEFENDANT TO NOTICE.

If the parties wish to submit on the tentative, please email the courtroom at SMCdept54@lacourt.org with notice to opposing counsel (or self-represented party) before 8:00 am on the day of the hearing.

The Court considers the moving papers, opposition, and reply.

BACKGROUND

On February 13, 2024, Plaintiff filed a complaint against Defendants, asserting seven causes of action for FEHA violations and wrongful termination.

ANALYSIS

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate a 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….”  (CCP § 1281.2.)  The right to compel arbitration exists unless the court finds that the right has been waived by a party’s conduct, other grounds exist for revocation of the agreement, or where a pending court action arising out of the same transaction creates the possibility of conflicting rulings on a common issue of law or fact.   (CCP § 1281.2(a)-(c).)  “The party seeking arbitration bears the burden of proving the existence of an arbitration agreement, and the party opposing arbitration bears the burden of proving any defense, such as unconscionability.”  (Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236.)

A.           Existence of Arbitration Agreement and Applicable Law

Defendants move to compel arbitration based on the arbitration agreement executed by Plaintiff on April 10, 2023. (Decl. Cometa-Fasanello, Exh. B.) The agreement provides, “all disputes, claims, complaints, or controversies . . . including … discrimination and/or harassment claims; retaliation claims; … and any other claim … arising out of and/or directly or indirectly related to my application for employment with the Company, and/or my employment with the Company, and/or the terms and conditions of my employment with the Company, and/or termination of my employment with the Company... are subject to confidential arbitration pursuant to the terms of this Agreement and will be resolved by Arbitration and NOT by a court or jury.” (Id.) This action arises from Plaintiff’s employment with Defendants.

Defendants have met their burden to establish an agreement to arbitrate. The burden shifts to Plaintiff to establish any defenses to enforcement.

B. Enforceability of Agreement

Plaintiff asserts that the arbitration agreement is procedurally unconscionable as an adhesion contract. Regarding procedural unconscionability, the California Supreme Court has found:

“[T]here are degrees of procedural unconscionability. At one end of the spectrum are contracts that have been freely negotiated by roughly equal parties, in which there is no procedural unconscionability . . . . Contracts of adhesion that involve surprise or other sharp practices lie on the other end of the spectrum. [Citation.] Ordinary contracts of adhesion, although they are indispensable facts of modern life that are generally enforced (see Graham v. Scissor–Tail, Inc. (1981) 28 Cal.3d 807, 817–818, 171 Cal.Rptr. 604, 623 P.2d 165), contain a degree of procedural unconscionability even without any notable surprises, and ‘bear within them the clear danger of oppression and overreaching.’ (Id. at p. 818 [171 Cal.Rptr. 604, 623 P.2d 165].)” (Gentry v. Superior Court (2007) 42 Cal.4th 443, 469, 64 Cal.Rptr.3d 773, 165 P.3d 556.)

(Baltazar v. Forever 21, Inc. (2016) 62 Cal.4th 1237, 1244.)

Generally, in the employer-employee context, there is unequal bargaining power. (See Amendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 115 [“in the case of preemployment arbitration contracts, the economic pressure exerted by employers on all but the most sought-after employees may be particularly acute, for the arbitration agreement stands between the employee and necessary employment, and few employees are in a position to refuse a job because of an arbitration requirement.”]

The Court finds a low degree of procedural unconscionability exists here, as the agreement is one of adhesion. This low degree of procedural unconscionability does not render the arbitration agreement unconscionable; to find the agreement unenforceable, the degree of substantive unconscionability must be high. (See Dotson v. Amgen, Inc. (2010) 181 Cal.App.4th 975, 981.)

Plaintiff asserts that the agreement is substantively unconscionable because it limits depositions and requires that arbitration be conducted by JAMS. The JAMS discovery rules allow for at least one deposition for both sides and allow for additional discovery through the arbitrator. This does not limit Plaintiff’s discovery. Plaintiff cites no other one-sided or unfair provisions in the JAMS rules. Plaintiff has not shown the agreement is unconscionable.

Defendants’ motion to compel arbitration is GRANTED. The action is STAYED.