Judge: Maurice A. Leiter, Case: 24STCV08721, Date: 2024-09-04 Tentative Ruling

Case Number: 24STCV08721    Hearing Date: September 4, 2024    Dept: 54

Hearing Date: September 4, 2024

Department 54, Judge Maurice A. Leiter

Motion to Compel Arbitration and Stay Proceedings

Moving Parties: Defendants Quixote Studios, LLC; and Sunset Quixote Holdings, LLC

Responding Party: Plaintiff Andrew Luber

T/R:    The Court GRANTS the motion to compel arbitration as to the second, third, fourth, and sixth causes of action, DENIES the motion as to the first and fifth causes of action, and STAYS the case pending completion of the arbitration.

DEFENDANTS TO GIVE 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

            This is an adverse employment action filed by Plaintiff Andrew Luber against Defendants Quixuote Studios, LLC; Quixote Holdings, LLC; and Joseph Williams on April 8, 2024, for (1) discrimination in violation of Gov. Code § 12940 et seq; (2) harassment in violation of Gov. Code. § 12940 et seq; (3) failure to prevent discrimination in violation of Gov. Code § 12940 et seq; (4) retaliation in violation of Gov. Code § 12940 et seq; (5) violation of Labor Code §§ 1102.5 and 6311; and (6) violation of public policy.

Defendants Quixuote Studios, LLC; and Quixote Holdings, LLC now move to compel arbitration and stay proceedings based on the arbitration agreement Plaintiff signed during his employment.

EVIDENTIARY MATTERS

Defendants ask the Court to take judicial notice of Exhibits (1)-(4), which are California Superior Court orders concerning various motions to compel arbitration.  Pursuant to Evidence Code §§ 452-453 and California Rule of Court 3.1306(c), the Court judicially notices those exhibits. The Court notes that rulings of other trial courts are not binding on this Court.  

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

            Defendants move to compel arbitration based on the Arbitration Agreement entered between Plaintiff and Defendants on May 15, 2023, as condition of Plaintiff’s continued employment. The Agreement provides:

(1) it is a mutual agreement to arbitrate claims arising out of Plaintiff’s employment (to the extent permitted by law) between HPP (i.e., Quixote’s parent company) and Plaintiff; (2) any arbitration proceeding brought under the Agreement is to be governed by the rules of JAMS, ADR Services, or any other reputable dispute resolution organization; (3) HPP will pay all costs unique to any such arbitration; (4) a neutral arbitrator is to be mutually selected by the parties; (5) parties to arbitration would be entitled to all discovery to which they would have been entitled had the parties’ controversy been filed in court; and (6) the arbitrator must issue a written opinion stating the essential findings of fact and conclusions of law.

Plaintiff does not contest the existence of the arbitration agreement or its general enforceability and validity. 

B.  Applicability of the FAA and the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act

a.    Second Cause of Action for Sexual Harassment

Plaintiff contends that the case should not be sent to arbitration under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, 9 USC §§ 401-402 (“EFAA”). “At the election of the person alleging conduct constituting sexual harassment dispute or sexual assault dispute . . .  no pre-dispute arbitration agreement. . . . shall be enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the sexual assault dispute or the sexual harassment dispute. (9 USC § 402(a).) Plaintiff also argues that his claim for gender-based hostile work environment is a “sexual harassment dispute” because FEHA defines sexual harassment broadly. Plaintiff says that the harassing conduct “need not have anything to do with sexual advances.” (Acardi v. Superior Court (1993) 17 Cal.App.4th 341, 348.)

Plaintiff alleges that Defendant Williams repeatedly made pointed, disparaging, and highly offensive references to Plaintiff’s sex, gender, and purported lack of masculinity. The dispute in this case arose after the execution of the arbitration agreement, making the agreement a “pre-dispute” agreement as defined by EFAA.

Defendants contend that Plaintiff’s claim is not for “sexual harassment” because he does not allege any sexual advances, conduct, or comments.

“The term ‘sexual harassment’ may lead many people to think of the...type of sexual harassment...which involves unwelcome sexual advances...but sexual harassment of the second type, the creation of a hostile work environment, need not have anything to do with sexual advances.” (Accardi v. Superior Court (1993) 17 Cal. App. 4th 341, 348.) This type of sexual harassment “shows itself in the form of intimidation and hostility for the purpose of interfering with an individual's work performance.” (Id. at 348.) The “pervasive use of derogatory and insulting terms relating to” an employee’s sex, and “addressed to an employee” of that sex may support a cause of action for hostile work environment sexual harassment. (Id. at 348-349 citing Andrews v. City of Philadelphia (3d Cir. 1990) 895 F.2d 1469, 1485.)

The Court finds that EFAA applies to Plaintiff’s second cause of action for harassment in violation of Government Code § 12940 et seq. As Plaintiff alleges in the Complaint:

Plaintiff also experienced immense discomfort as a result of WILLIAMS’ numerous, repeated, hostile, offensive, overt references to his sex/gender. On one particular occasion, in response to Plaintiff’s complaint that WILLIAMS had assumed a physically aggressive posture, WILLIAMS responded, “this is how a man acts. You’re not used to that, obviously.” WILLIAMS requested that Plaintiff complete unsafe work-related tasks, and when Plaintiff indicated that he was reticent to engage in these tasks, on account of safety and other legitimate concerns, WILLIAMS would suggest that Plaintiff was lacking in masculinity. WILLIAMS repeatedly and consistently made pointed, disparaging, and highly offensive references to Plaintiff’s sex, gender, and purported lack of masculinity to the effect of comments, such as, “ . . . a real man would do this.”

(Compl., ¶ 23.)

It was obvious to Plaintiff that WILLIAMS was attempting to strategically belittle him in a way that was related to his sex, his gender, and his purported lack of “masculinity.” Of course, these comments contributed to the emotionally distressing nature of the work environment. As time went on, WILLIAMS’ denigrating treatment on account of Plaintiff’s religion, gender, and sex intensified.

(Compl., ¶ 24.)

Defendants argue that Plaintiff does not plead facts sufficient to establish a prima facie claim of harassment against Defendants. The Court does not reach an argument properly made in demurrer, not a motion to compel arbitration.  This cause of action, as pleaded, falls within EFAA.

b.  Remaining Causes of Action

Plaintiff asserts that his other causes of action are meaningfully intertwined with his claims for hostile work environment harassment based on sex, and are all “related to” Plaintiff’s sexual harassment dispute. Plaintiff argues that federal courts interpreting the EFAA hold that when the plaintiff has adequately pleaded a sexual harassment claim within the purview of the EFAA the entire lawsuit should be litigated in civil court. (See, e.g. Johnson v. Everyrealm, Inc. (S.D.N.Y. 2023) 657 F.Supp.3d 535, 540 (“[T]he Court construes the EFAA to render an arbitration clause unenforceable as to the entire case involving a viably pled sexual harassment dispute, as opposed to merely the claims in the case that pertain to the alleged sexual harassment.”); Molchanoff v. SOLV Energy, LLC (S.D. Cal. 2024) 2024 WL 899384, at *5 (“[T]he Court holds that, because Plaintiff’s 2022 retaliation claim alleges conduct constituting a sexual harassment dispute—as defined by 9 U.S.C. 401(4), and because the case as a whole relates to that dispute, the EFAA bars enforcement of the arbitration agreement between Plaintiff and PeopleReady as to all claims in this case, and as to all Defendants in this case.”).)

Defendants argue that even if Plaintiff has pleaded a sexual harassment claim, Plaintiff’s other claims that do not “relate to” his sexual harassment claim must be arbitrated. Defendants contend that it is well-settled under the Federal Arbitration Act that “if a dispute presents multiple claims, some arbitrable and some not, the former must be sent to arbitration even if this will lead to piecemeal litigation.” (KPMG LLP v. Cocchi, 565 U.S. 18, 19 (2011).) Defendants assert that Johnson incorrectly took an “overbroad” approach to EFAA in concluding that other claims could not be arbitrated. (Id.)

The federal trial court decisions Plaintiff advances and the Superior Court rulings Defendants advance are not binding on this Court.  The Court agrees that the FAA commonly permits claim splitting. Until the Court of Appeal weighs in, the Court also concludes that EFAA intends only that claims “related to” the sexual harassment dispute be adjudicated together in Court. The Court turns to which of the remaining causes of action are related to the allegations of sexual harassment in the second cause of action.

The first cause of action for discrimination alleges discrimination based on “his disability, perceived disability, and/or religious creed.” (Compl. ¶ 37.) The alleged disability is “temporomandibular joint disorder, as well as other conditions.” (Compl. ¶ 39. This is not related to the sexual harassment claim.

The third and fourth causes of action for failure to prevent harassment in violation of the FEHA and retaliation in violation of the FEHA, respectively, are based on his claim of discrimination, harassment, and retaliation. They fall, at least in part, within the ambit of EFAA.

The fifth cause of action, for violation of Labor Code §§ 1102.5 and 6311, alleges that Plaintiff was discharged from employment due to complaining about the right to work in a safe and healthful workplace. (Compl. ¶ 73.) This does not appear to relate to the sexual harassment claim.

The sixth cause of action, for violation of policy, alleges that, “as set forth in Government Code section 12940 et seq., there exists a fundamental public policy in California prohibiting discrimination and harassment based on, among other things, religious creed, sex, gender, disability, and perceived disability.” (Compl. ¶ 81.) This relates, at least in part, to the sexual harassment claim.

            The Court GRANTS the motion to compel arbitration as to the second, third, fourth, and sixth causes of action, DENIES the motion as to the first and fifth causes of action, and STAYS the case pending completion of the arbitration.