Judge: Maurice A. Leiter, Case: 24STCV32197, Date: 2025-03-17 Tentative Ruling

Case Number: 24STCV32197    Hearing Date: March 17, 2025    Dept: 54

Hearing Date: March 17, 2025

Department 54, Judge Maurice A. Leiter

Motion to Compel Arbitration

Moving Party: Defendant Uptime Energy, Inc.

Responding Party: Plaintiff Kathleen Garcia

T/R:     THE COURT ORDERS AN EVIDENTIARY HEARING ON THE ISSUE OF ASSENT TO THE ARBITRATION AGREEMENT FOR MARCH 28, 2025 AT 10:00 AM.

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 December 6, 2024, Plaintiff filed a complaint against Defendant, asserting 9 causes of action for FEHA violations, wrongful termination, and retaliation.

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

Defendant moves to compel arbitration based on the Dispute Resolution Protocol executed by Plaintiff on March 1, 2022. (Decl. Tran, Exh. A.) The agreement provides, ““his DRP covers any dispute arising out of or relating to your co-employment with TriNet, including your TriNet co-employer, and/or arising out of or relating to your employment with your company, as well as any dispute with an employee, officer, or director of TriNet or of a TriNet customer (all of whom, in addition to TriNet customers, are intended to be beneficiaries of this DRP) (“covered dispute”), including, but not limited to, all claims whether arising in tort or contract and whether arising under statute or common law including, but not limited to, any claim of breach of contract, discrimination or harassment of any kind.” (Id.)

Defendant provides the declaration of Vice President of Finance and Accounting of Uptime, My Tran, who states Plaintiff executed the agreement with a unique link and password. Plaintiff was employed by Uptime through the temp agency TriNet.

In opposition, Plaintiff disputes that she executed the agreement, declaring, “I was never presented with TriNet’s Terms and Conditions (‘TCA’) when I logged on to TriNet for the first time or any time thereafter. I was never asked, nor was I ever prompted by TriNet to review the full text or any text related to the TCA or presented with the option to click ‘accept’ or ‘acknowledge’ for the TCA. I was never made aware of the existence of a Dispute Resolution Protocol (‘DRP’) in the TCA, nor was I ever presented with a DRP. I’ve never seen, signed, read or acknowledged any arbitration agreement as it relates to my employment with Defendant.” (Decl. Garcia ¶ 9.)

As Plaintiff claims she did not execute the arbitration agreement, the Court will set an evidentiary hearing on the issue of assent to agreement.

B. Enforceability of Agreement

Plaintiff asserts that the arbitration agreement is procedurally unconscionable because it is an adhesion contract and because Plaintiff was never presented with the agreement. 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 that some degree of procedural unconscionability exists here because there is unequal bargaining power between the parties. This 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 is overly broad in time and scope, fails to provide adequate discovery, lacks mutuality, and contains a class action waiver. The Court disagrees. The agreement requires mutual arbitration and contains no restrictions on discovery. The class action waiver is capable of severance and is not so substantively unconscionable as to render the entire agreement unenforceable.