Judge Michael Small, Case 22STCV39825 2023-05-23 Tentative Ruling

Judge: Michael Small, Case: 22STCV39825, Date: 2023-05-23 Tentative Ruling

Case Number: 22STCV39825 Hearing Date: May 23, 2023 Dept: 57

Nicholas Garcia sued his former employer Reyes Coca-Cola Bottling, LLC (“RCCB”) and Moises Sandoval, a manager at RCCB during Garcia’s employment there (collectively “the Defendants”). Garcia’s complaint asserts causes of action for discrimination, harassment, and retaliation under California’s Fair Housing and Employment Act; violations of wage, hour, and sick leave laws in the California Labor Code and California’s Family Rights Act; and conversion and trespass to chattels related to Garcia’s personal property. Pending before the Court is Defendants’ motion to compel arbitration of Garcia’s claims. Garcia has filed evidentiary objections to declarations that Defendant submitted in support of the motion. The Court is granting the motion and overruling Garcia’s evidentiary objections.

THE ARBITRATION AGREMEENT

Defendants’ motion is based on an Arbitration of Disputes Agreement (“the Agreement”) that Garcia signed when he accepted employment at RCCB in 2017. The Agreement is between RCCB as the “Company” and Garcia as “the undersigned employee.” Covered parties include “any of [the Company’s] supervisors, employees, agents, members, directors, officers, partners, shareholders, and any parent, subsidiary, affiliated or successor Company.” Sandoval as a RCCB employee is thus also a party to the Agreement.

In pertinent part, the Agreement provides:

Any employment-related legal claims or controversies (“Claims”) an employee may have against the Company, or that the Company may have against an employee, must be resolved by arbitration instead of the courts, and the parties mutually waive their right to a trial before a judge or jury in federal or state court in favor of arbitration under this Agreement.

The “Claims” covered by the Agreement encompass:

claims for wages or other compensation due; . . . tort claims; claims for harassment or discrimination (including, but not limited to, . . . medical condition, handicap, disability or other protected characteristic under applicable discrimination law); . . . and claims for violation of any federal, state or other governmental law, statute, regulation, ordinance or common law.

GOVERNING LAW

Under both the Federal Arbitration Act and Title 9 of Part III of the California Code of Civil Procedure commencing at section 1281 (known as the California Arbitration Act), arbitration agreements are valid, irrevocable, and enforceable, except on such grounds that exist at law or equity for voiding a contract. (Winter v. Window Fashions Professions, Inc. (2008) 166 Cal.App.4th 943, 947.) Code of Civil Procedure section 1281.2 permits a party to file a motion to request that the Court order the parties to arbitrate a controversy. The Court shall grant the motion if an agreement to arbitrate the controversy exists, “unless [the Court] determines that: (a) The right to compel arbitration has been waived by the petitioner; or (b) Grounds exist for rescission of the agreement.” In considering a motion to compel arbitration, the Court first decides whether an enforceable arbitration agreement exists between the parties, and then determines whether the plaintiff’s claims are covered by the agreement. (Omar v. Ralphs Grocery Co. (2004) 118 Cal.App.4th 955, 961.) “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.) Unconscionability has procedural and substantive dimensions. A party claiming that an arbitration agreement is unenforceable because it is unconscionable must show that the agreement is both procedurally and substantively unconscionable. (Little v. Auto Stiegler, Inc. (2003) 29 Cal.4th 1064, 1071.)

DISCUSSION

A. The Agreement Was Signed by Garcia and Covers the Claims in His Complaint

The Agreement was electronically signed by Garcia and is dated, apparently mistakenly, August 23, 1985, which is Garcia’s date of birth. RCCB provided evidence that Garcia electronically signed the Agreement on December 8, 2017 when he completed the task online as one of the documents he signed electronically at that time.

Garcia does not dispute that the Agreement covers the claims asserted in his complaint. However, Garcia contests the existence of the Agreement. This argument is based on the assertions, forth in his declaration, that he does not recall reviewing or receiving the Agreement, and does not recall signing it. Garcia’s contention that the Agreement does not exist is unpersuasive both legally and factually. As to the law, lack of recall of signing an arbitration agreement does not negate the agreement’s existence. (Harris v. Tap Worldwide LLC (2016) 248 Cal.App.4th 373, 383; Bolanos v. Khalatian (1991) 231 Cal.App.3d 1586, 1590.) As to the facts, the evidence RCCB submitted indicates that the onboarding documents that Garcia electronically signed could only be completed when Garcia, as user of the electronic signature program, was logged into his account using his password that he created. RCCB Human Resources personnel can review completed onboarding documents. But those individuals cannot complete or modify onboarding documents -- only the user, in this case Garcia, can do so.

B. Unconscionability

Garcia argues that even if the Agreement exists, it is procedurally and substantively unconscionable and thus is unenforceable. Garcia has failed to carry his burden of proving both procedural and substantive unconscionability.

As to procedural unconscionability, Garcia’s initial hook is that he had to sign the Agreement as a condition of his employment at RCCB. This problem for Garcia on this front is that long-standing California precedent holds that “a compulsory predispute arbitration agreement is not rendered unenforceable just because it is required as a condition of employment or offered on a ‘take it or leave it’ basis.” (Lagatree v. Luce, Forward, Hamilton, & Scripps (1999) 74 Cal.App.4th 1105, 1127.) Garcia’s second procedural unconscionability hook is that while the Agreement provides that arbitration will be conducted in accordance with the rules of the arbitration body known as JAMS, Inc., RCCB did not provide him with a copy of the JAMS rules. The problem for Garcia on this front is that the failure to attach the arbitration body’s rules to the agreement does not render the agreement procedural unconscionable where, as here, an agreement references the rules and made no modification to them. (Lane v. Francis Capital Management LLC (2014) 224 Cal.App.4th 676, 691.) The Agreement also contains an accessible hyperlink to the JAMS rules.

Garcia’s argument that the Agreement is substantively unconscionable is tied to purported deficiencies in the discovery and relief afforded by the Agreement in arbitrations, and the high fees and costs of arbitration. This argument is unavailing. For one, the Agreement provides for adequate discovery. Per JAMS Rule 17, each party may take at least one deposition and the parties are to attempt to agree on the number, time and duration of the deposition(s). In the event no agreement is reached on these issues, the arbitrator shall determine them, including whether to grant a request for additional depositions. Garcia offers no evidence to support the notion that an arbitrator will deny any such request. Moreover, Garcia cites no precedent that the discovery available in a JAMS arbitration is inadequate. Next, Garcia has not shown that the relief available to him in arbitration is inadequate. The Agreement states that “[t]he arbitrator(s) will have the authority to grant any appropriate remedy that would be available under applicable law in a court proceeding, whether legal or equitable.” Finally, the Agreement does not require Garcia to pay any arbitration filing fees or for the costs of the arbitrator. The Agreement provides that those fees and costs shall be borne by RCCB.

CONCLUSION

In sum, Garcia agreed to arbitrate his claims against the Defendants, and the Agreement is enforceable. Accordingly, Defendant’s motion to compel arbitration is granted. In reaching this conclusion, the Court declined Defendants’ request to take judicial notice of trial court decisions granting motions to compel arbitration made under this very same Agreement in cases brought by other RCCB employees. Those decisions are not precedent.

Because the Court is granting Defendants’ motion to compel arbitration, proceedings in this Court are stayed pending the outcome of the arbitration. (Code Civ. Proc., § 1281.4.)