Judge: Monica Bachner, Case: 22STCV00473, Date: 2023-02-09 Tentative Ruling

Case Number: 22STCV00473    Hearing Date: February 9, 2023    Dept: 71

Superior Court of California

County of Los Angeles

DEPARTMENT 71

TENTATIVE RULING

Specially Appearing Defendant Gail Dandy’s motion to quash service of summons is granted. This matter is dismissed without prejudice as to Specially Appearing Defendant Dandy. Specially Appearing Defendant Dandy is to submit a proposed judgment of dismissal with prejudice within 10 court days. 

Plaintiff Miguel Zelidon’s request for sanctions against Defendant Gail Dandy is denied.

Defendant Dandy’s motion to compel arbitration of Plaintiff’s claims in this action is denied as moot. 

Defendant Ground Services International Incorporated’s motion to compel arbitration of Plaintiff’s claims in this action is granted.  The case is stayed pending arbitration. 

The matter is set for a status conference regarding arbitration on February 9, 2024, at 8:30 a.m.  The parties are ordered to file a joint status report five calendar days in advance of the hearing.

Defendant Gail Dandy (“Dandy”) (“Defendant”) makes a special appearance solely for the purpose of challenging jurisdiction and moves for an order quashing service of the summons and complaint upon her on the grounds the court lacks personal jurisdiction over her, and Plaintiff has not affected proper service on her.  (Notice of Motion Quash, pgs. 1-2; C.C.P. §418.10.)  In opposition, Plaintiff Miguel Zelidon (“Zelidon”) (“Plaintiff”) requests this Court award him sanctions against Defendant Dandy and her counsel, jointly and severally, in the amount of $7,807.26, on the grounds Defendant Dandy filed the motion to quash in bad faith and without substantial justification.  (Notice Opposition Quash, pgs. 1-2; C.C.P. §1987.2(a).)

Defendant Ground Services International Incorporated (“GSI”) (“Defendant”) moves for an order compelling arbitration of all claims asserted by Plaintiff Miguel Zelidon (“Zelidon”) (“Plaintiff”) in this action and dismissing or alternatively staying the action pending completion of arbitration.  (Notice of Motion GSI, pgs. 1-2; C.C.P. §§1280 et seq.; 9 U.S.C. §§3, 4; 14 Penn Plaza LLC v. Pyett (2009) 556 U.S. 247.)

Defendant Dandy moves for an order compelling arbitration of all claims asserted by Plaintiff in this action and dismissing or alternatively staying the action pending completion of arbitration.  (Notice of Motion Dandy, pgs. 1-2; C.C.P. §§1280 et seq.; 9 U.S.C. §§3, 4; 14 Penn Plaza LLC, 556 U.S. 247.)

1. Defendant Dandy’s Motion to Quash Service of Summons

    

Background

On January 5, 2022, Plaintiff filed his complaint for disability discrimination under the Fair Employment and Housing Act (“FEHA”), meal and rest break violations under the California Labor Code, and violation of CFRA, and wrongful termination in violation of public policy against Defendant GSI and its former employee Defendant Dandy.  (See Complaint.)  Plaintiff’s Complaint alleges on or about September 18, 2018, Plaintiff was hired by Defendants as a fully-time non-exempt Airplane Cabin Cleaner.  (Complaint ¶18.)  Plaintiff alleges on or about October 1, 2018, he was promoted to Lead Airplane Cabin Cleaner.  (Complaint ¶26.)  Plaintiff alleges on or about May 8, 2020, Defendants terminated his employment.  (Complaint ¶34.) 

On February 14, 2022, Plaintiff filed two proofs of service indicating Defendants had each been personally served, with Defendant Dandy specifically served on February 9, 2022, at 2:30 PM at 5020 W 63rd Street, Los Angeles, CA 90056, by a registered process server.  (Proof of Service Dandy.)

On March 8, 2022, Defendant GSI removed this case to federal court; however, on May 4, 2021, the U.S. District Court for the Central District of California remanded the action to state Court on the grounds Defendant GSI failed to meet its burden to establish complete diversity jurisdiction.  (Notice of Removal to Federal Court; Notice of Remand.)  On June 10, 2022, Defendant Dandy filed the instant motion to quash service of summons.  On January 27, 2023, Plaintiff filed his opposition and request for sanctions against Defendant Dandy.  On February 2, 2022, Defendant Dandy filed her reply.

Motion to Quash

C.C.P. §418.10(a)(1) provides that, “A defendant, on or before the last day of his or her time to plead or within any further time that the court may for good cause allow, may serve and file a notice of motion . . . [t]o quash service of summons on the ground of lack of jurisdiction of the court over him or her.”

California’s long-arm statute permits a court to exercise personal jurisdiction on any basis consistent with state or federal constitutional principles.  (C.C.P. §410.10.)  “When a defendant moves to quash service of process on jurisdictional grounds, the plaintiff has the initial burden of demonstrating facts justifying the exercise of jurisdiction.  Once facts showing minimum contacts with the forum state are established, however, it becomes the defendant’s burden to demonstrate that the exercise of jurisdiction would be unreasonable.”  (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 449, citations omitted.)  Plaintiff must meet his initial burden by a preponderance of competent and relevant evidence, as shown in affidavits and documentary evidence.  (See Ziller Electronics Lab GmbH v. Superior Court (1988) 206 Cal.App.3d 1222, 1232-1233.)

          “Personal jurisdiction may be either general or specific. A nonresident defendant may be subject to the general jurisdiction of the forum if his or her contacts in the forum state are ‘substantial . . . continuous and systematic.’ In such a case, ‘it is not necessary that the specific cause of action alleged be connected with the defendant’s business relationship to the forum.’ Such a defendant’s contacts with the forum are so wide-ranging that they take the place of physical presence in the forum as a basis for jurisdiction.”  (Vons Companies, Inc., 14 Cal.4th at pgs. 445-446, citations omitted.)

“If the nonresident defendant does not have substantial and systematic contacts in the forum sufficient to establish general jurisdiction, he or she still may be subject to the specific jurisdiction of the forum, if the defendant has purposefully availed himself or herself of forum benefits, and the ‘controversy is related to or ‘arises out of’ a defendant’s contacts with the forum.’”  (Id. at pg. 446, citations omitted.)  The purposeful availment test is only satisfied if the defendant purposefully and voluntarily directs its activities toward California so that the defendant should expect, because of the benefits it receives, to be subject to jurisdiction here based on its contacts with California.  (Snowney v. Harrah’s Entertainment, Inc. (2005) 35 Cal.4th 1054, 1062.)  Purposeful availment occurs when a nonresident defendant purposefully directs its activities at California residents, deliberately engages in significant activities here, or creates “continuing obligations” between itself and California residents.  (Id. at pg. 1063.)

“The crucial inquiry concerns the character of defendant’s activity in the forum, whether the cause of action arises out of or has a substantial connection with that activity, and upon the balancing of the convenience of the parties and the interests of the state in assuming jurisdiction.”  (Vons Companies, Inc., 14 Cal.4th at pg. 448, citing Cornelison v. Chaney (1976) 16 Cal.3d 143, 147-148).  Jurisdiction is proper when the defendant’s contacts proximately result from its actions that create a “substantial connection” with the forum state.  (Hanson v. Denckla (1958) 357 U.S. 235, 253.) 

          Plaintiff has not established general jurisdiction over Defendant Dandy.  This Court cannot exercise general jurisdiction over Defendant Dandy because she has resided full time and continuously in North Carolina since May 14, 2020, retired from her employment with Defendant GSI on September 4, 2020, has not been employed by a California employer since her employment with Defendant GSI, and has not been in California since May 14, 2020.  (Decl. of Dandy ¶¶7-8.)  Defendant Dandy is the sole owner of real property at 5020 W 63rd Street, Los Angeles, California 90056, which has served as her rental property since May 14, 2020.  (Decl. of Dandy ¶8.)  Defendant Dandy was not residing at the 5020 W 63rd Street property in February 2022, was not served with Plaintiff’s summons and complaint at that address, and the tenants at the property did not have authority to accept service on Defendant Dandy’s behalf.  (Decl. of Dandy ¶8.)[1]  

          Plaintiff’s arguments regarding general jurisdiction are unavailing because he has not met his burden to establish by a preponderance of evidence that Defendant Dandy has sufficient minimum contacts with California as to render her “at home” in the state.  Plaintiff merely relies on his unverified Complaint, which is insufficient to meet his evidentiary burden on this motion.  (Rivelli v. Hemm (2021) 67 Cal.App.5th 380, 393 [“When a nonresident defendant challenges a trial court’s exercise of personal jurisdiction, the plaintiff bears the initial burden to demonstrate facts justifying the exercise of jurisdiction. [Citations]. To meet this burden, a plaintiff must do more than make allegations. A plaintiff must support its allegations with ‘competent evidence of jurisdictional facts. Allegations in an unverified complaint are insufficient to satisfy this burden of proof.’”], emphasis added.)  Plaintiff has not demonstrated any activities by Defendant Dandy that constitute sufficient minimum contacts with California such that they are subject to general jurisdiction. 

Plaintiff’s argument that Defendant Dandy’s ownership of rental property in California is also not sufficient to satisfy the minimum contacts doctrine.  (Opposition, pgs. 3-4.)  “Ownership of property in California ‘alone would not support the State’s jurisdiction.’”  (Thomson v. Anderson (2003) 113 Cal.App.4th 258, 271.) None of Plaintiff’s allegations in his Complaint relate to Defendant Dandy’s California rental, and Plaintiff has not met his burden to cite to case law demonstrating a nonresident’s in-state rental property alone satisfies the burden of establishing minimum contacts for the purpose of general jurisdiction.

Plaintiff failed to demonstrate by a preponderance of evidence that Defendant Dandy has sufficient contacts with California for this Court to exercise specific jurisdiction over her.  Again, Plaintiff merely relies on his unverified Complaint, which is insufficient to meet his evidentiary burden on this motion.  (Rivelli, 67 Cal.App.5th at pg. 393.)  Plaintiff failed to demonstrate by a preponderance of evidence that Defendant Dandy purposefully and specifically availed herself of the benefits of conducting activities in California by being employed by Defendant GSI in California such that she had fair warning to that her employment may result in being haled into a California court.  (Rivelli, 67 Cal.App.5th at pg. 393.)  Plaintiff failed to demonstrate by a preponderance of evidence that the controversy in Plaintiff’s Complaint arises out of or is related to Defendant Dandy’s alleged contacts with California with regard to her employment with Defendant GSI, and the exercise of jurisdiction would be fair and reasonable.  (Id.)  While California has an inherent interest in adjudicating disputes involving employees who were wronged in California, especially where the claims are all under California law, and it is in Plaintiff’s interest to obtain effective relief in California given that he not only resides here and was employed here, but also that the wrongs he alleged were in California and California has substantial interest in providing a convenient forum for its residents, such fairness factors do not outweigh the fact that Plaintiff did not meet his burden to produce evidence of Defendant Dandy’s contacts with the forum state. Accordingly, the Court finds Plaintiff has not met his burden of submitting evidence to establish specific jurisdiction over Defendant Dandy.

          Based on the foregoing, Defendant Dandy’s motion to quash is granted.

          This matter is dismissed with prejudice as to Specially Appearing Defendant Dandy. Specially Appearing Defendant Dandy is to submit a proposed judgment of dismissal with prejudice within 10 court days.

          Sanctions

In light of this Court’s ruling on Specially Appearing Defendant Dandy’s motion to quash service of summons, Plaintiff’s request for monetary sanctions against Defendant Dandy is denied.

1. Defendant Dandy’s Motion to Compel Arbitration

    

    

In light of this Court’s ruling on Specially Appearing Defendant Dandy’s motion to quash service of summons, Defendant Dandy’s motion to compel arbitration is denied as moot.[2]^{, [3]} 

1. Defendant GSI’s Motion to Compel Arbitration

    

Evidentiary Objections

Plaintiff’s 1/19/23 evidentiary objections to the Declaration of Britney E. Willis (“Willis”) are overruled as to Nos. 1, 2, 3, 4, and 5.

Plaintiff’s 1/19/23 evidentiary objections to the Declaration of Stella Iheaka (“Iheaka”) are overruled as to Nos. 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, and 21.

Background

On or about September 18, 2018, Plaintiff was hired by Defendant GSI as a fully-time non-exempt Airplane Cabin Cleaner.  (Complaint ¶18.)  Plaintiff alleges on or about October 1, 2018, he was promoted to Lead Airplane Cabin Cleaner.  (Complaint ¶26.)  Plaintiff alleges on or about May 8, 2020, Defendant terminated his employment.  (Complaint ¶34.)  On January 5, 2022, Plaintiff filed his complaint for disability discrimination under the Fair Employment and Housing Act (“FEHA”), meal and rest break violations under the California Labor Code, and violation of CFRA, and wrongful termination in violation of public policy against Defendant GSI and its former employee Defendant Dandy.  (See Complaint.)  Defendant GSI filed the instant motion to compel arbitration on October 12, 2022. Plaintiff filed his oppositions on January 19, 2023.  Defendant GSI filed its reply on January 25, 2023.

A.  Arbitration Agreement

Defendant GSI argues Plaintiff’s claims are subject to arbitration under a collective bargaining agreement (“CBA”) that Amalgamated Production & Service Employees Union, Local 22, Eastern States Joint Board, International Union of Allied Novelty & Production Workers, AFL-CIO (“Local 22”) and Defendant GSI entered into on September 1, 2018, which covers GSI Agents, Cabin Service Agents, Leads and/or Acting Supervisors.  (Motions, pg. 7; Decl. of Iheaka ¶¶4-6, Exhs. A, B.)  Defendant GSI argues during the term of Plaintiff’s employment with Defendant GSI, Plaintiff was at all times a member of Local 22 and thus subject to the arbitration provisions of the CBA between Local 22 and Defendant GSI.  (Motions, pg. 7; Decl. of Iheaka ¶¶4-6, Exhs. A, B.)  Defendant GSI argues the CBA applies to Plaintiff given his employment with Defendant GSI, classification, and station.  (Motions, pg. 8.) 

Article 17, Section 4 of the CBA provides for binding arbitration (“Arbitration Agreement”) as follows:

1. Within ten (10) days of receipt of a demand for arbitration, the Company CEO and designated local Union Representative, will agree upon an impartial arbitrator to sit with Board as an additional member in further hearing and determination of the matter. If they are unable to select an arbitrator within that time frame, either party may request the American Arbitration Association to make the selection in accordance with the usual practices of the Association in this connection.

    

2. The Board, which included the arbitrator for arbitration shall review the appeal matter based solely on the evidence and the arguments presented by the respective parties. The arbitration decision of the Board shall be final and binding on the Company, the Union and the employee.

    

3. The grievance and arbitration procedures provided in this Agreement shall constitute the sole means for resolving disputes arising under this Agreement.

    

4. The fees and expenses incident to the services of the arbitrator shall be shared equally by the Company and the Union.

(Decl. of Iheaka ¶6, Exh. B at Art. 17 §4.)  

On October 1, 2019, Local 22 and GSI entered into an addendum relating to Los Angeles unit employees, set forth economic terms and conditions of employment supplemental to the Master Agreement, such as increased wage rates, meal and rest break rules, and paid time off.  (Decl. of Iheaka ¶7, Exh. C.)  On January 8, 2020, Local 22 and Defendant GSI entered into Amendment #1 to the CBA, which modified Article 8-Hourly Paid Time Off.  (Decl. of Iheaka ¶8, Exh. D.)  On February 7, 2020, Local 22 and GSI entered into Amendment #2 to the CBA, effective September 1, 2018, which supplemented Article 17 of the CBA regarding its arbitration provisions.  (Decl. of Iheaka ¶9, Exh. E §1 [“This Amendment is intended to correct and clarify certain provisions of the Agreement to reflect the bargained for agreements of the parties.”].)  Amendment #2 revised Article 17, Section 2(a) of the CBA to read:

Any employee grievance or dispute relating to the application or interpretation of any provision of this Agreement, preferred charges in writing against an employee or any claim or controversy as described in Article 17(4)(e) below, shall be resolved, exclusively by means of the grievance and arbitration procedures set forth in Article 17 of the Collective Bargaining Agreement.

(Decl. of Iheaka, Exh. E §2.)  Amendment #2 added the following subsection which specifically and expressly identifies that the claims alleged by Plaintiff in this case are subject to arbitration:

1. Controversies or claims subject to arbitration include, without limitation all wage and hour (or related) claims under state law or local law or the federal Fair Labor Standards Act including but not limited to laws governing: wage or hour or labor standards which may include but are not limited to claims involving: meal periods, rest breaks, minimum wages, overtime wages, unpaid wages including working “off the clock”, incorrect rates of pay, payment of last paycheck, wage statements, reimbursement of expenses (e.g., tools, uniforms, cell phone charges, mileage and subsistence, etc.), recordkeeping violations, travel time, vacation time, sick time, heat illness recovery, timely payment of wages, waiting time penalties, recordkeeping of personnel files, time records, manner of clocking in and out, and payroll records, suitable seating and other workplace environment claims, and without limiting the foregoing all claims and controversies airing under the following: . . .  California Family Rights Act — Cal. Gov't Code § 12945.2; California Fair Employment and Housing Act — Cal. Gov’t Code § 12900 et seq. . . the California Labor Code. . .”

(Decl. of Iheaka, Exh. E §4, emphasis added.) 

The Federal Arbitration Act (“FAA”)  controls the CBA’s Arbitration Agreement because Defendant GSI engages in and affects interstate commerce.  Defendant GSI has offices located in multiple states including Florida, California, and New Jersey and also provides ground-handling services for the aviation industry in fourteen cities throughout the country.  (Decl. of Iheaka ¶2.)  (9 U.S.C. §2; Serpa v. California Surety Investigations, Inc. (2013) 215 Cal.App.4th 695, 702 n.3 [parties’ arbitration agreement was governed by the FAA since the employer routinely engaged in interstate commerce].  Plaintiff does not dispute that the FAA controls the CBA.  Accordingly, Defendant GSI argues met its burden to establish the existence of a valid Arbitration Agreement.

1. Execution of the CBA

          The National Labor Relations Act (the “NLRA”) “governs federal labor-relations law” and allows employees to designate a union “as their exclusive representative for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment, or other conditions of employment.”  (14 Penn Plaza v. Pyett (2009) 556 U.S. 247, 256.)  Employers, in turn, have “a corresponding duty . . . to bargain in good faith ‘with the representative of . . . employees’ on

wages, hours, and conditions of employment.”  (Id. at 256, quoting 29 U.S.C. §158(a)(5).)  “As in any contractual negotiation, a union may agree to the inclusion of an arbitration provision in a collective bargaining agreement” as a means of avoiding litigation costs, in return for which the union receives other considerations, including an agreement not to strike or walk-out.  (See, e.g.

14 Penn Plaza, 556 U.S. at 257, 265-266; Circuit City Stores, Inc. v. Adams (2001) 532 U.S. 105, 123.)  Courts are generally prohibited from interfering in this “bargained for exchange.” (14 Penn Plaza, 556 U.S. at 257.)

That Plaintiff himself did not individually sign an arbitration agreement does not affect the determination that he is bound to arbitrate. “Nothing in the law suggests a distinction between the status of arbitration agreements signed by an individual employee and those agreed to by a union representative.”  (14 Penn Plaza, 556 U.S. at 258.)  Further, Plaintiff’s signed Union Application authorizing Local 22 “to represent [him] for the purpose of collective bargaining” provides,

I also realize that this form is notice of my right to be or remain a nonmember of Local Union 11, and that, as a nonmember, I have the right to object to paying and receiving a reduction in dues for union activities not germane to the union’s duties as a bargaining agent, provided, however, that I must file my objection with Local Union 22 within thirty (30) calendar days from the date I signed this form; to be given sufficient information to enable me to intelligently decide whether to object; and to be apprised of any internal union procedures for filing objections.

(Decl. of Iheaka, Exh. A.)

Plaintiff’s claim in opposition that Defendant GSI has not met its burden to establish the existence of a valid agreement to arbitrate because Defendant has failed to prove that Plaintiff is a member of Local 22 is unavailing.  Local 22 provided Plaintiff with a hard copy membership card to carry.  (Decl. of Miranti ¶5, Exh. G.)  Plaintiff further authorized Defendant GSI to recurringly deduct $32.00 in Union dues and fees from his earned wages and forward that money to Local 22 as membership payment, and Plaintiff did not contact Defendant GSI over the course of his employment with concerns about his Local 22 membership or recurring dues.  (Decl. of Morgan ¶4, Exh. A.)  Although Plaintiff declares that “he did not read or write English proficiently,” “spoke English at an elementary level,” and “definitely could not have understood the meaning and contents of any documents pertaining to the union in English,” as on September 18, 2018, Plaintiff indicated that he read and understood English and did not need Defendant GSI’s offer of employment translated.  (Decl. of Zelidon ¶3; Decl. of Morgan, Exh. D.) 

1. Waiver of Arbitration

    

Plaintiff argues in opposition that Defendant waived its right to compel arbitration because it failed to timely produce the purported Arbitration Agreement or indicate Defendant’s willingness to arbitrate.  (Opposition, pgs. 6-8.)  Where a party waives its right to arbitration, a court must deny a motion to compel.  (See C.C.P. §1281.2(a).)  In determining waiver, a court can consider the following factors: (1) whether the party’s actions are inconsistent with the right to arbitrate; (2) whether the litigation machinery has been substantially invoked; (3) whether a party either delayed arbitration enforcement for a long period before seeking a stay or requested arbitration enforcement close to the trial date; (4) whether a defendant seeking arbitration filed a counterclaim without asking for a stay of the proceedings; (5) whether important intervening steps [(e.g., taking advantage of judicial discovery procedures not available in arbitration)] had taken place; and (6) whether the delay affected, misled, or prejudiced the opposing party.  (St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187.)

Plaintiff argues Defendant waited eight months after he filed and served his summons and complaint on Defendant to petition to compel arbitration, and in Defendant’s counsels’ communications with Plaintiff, made no reference to the CBA, the CBA’s purported arbitration clause, or Defendant’s intent to compel arbitration, and instead filed a notice of removal of action to the U.S. District Court on March 10, 2022, indicating Defendant’s intent to litigate in federal court rather than pursue alternative dispute resolution.  (Opposition, pg. 7.)   Plaintiff argues after Plaintiff’s motion to remand was granted, rather than filing the motion at hand, Defendant GSI filed an Answer to Plaintiff’s Complaint, omitting any reference to an Affirmative Defense reserving Defendant GSI’s right to compel arbitration.  (See Guess?, Inc. v. Superior Court (2000) 79 Cal.App.4th 553, 558 [“At a minimum, the failure to plead arbitration as an affirmative defense is an act inconsistent with the later assertion of a right to arbitrate.”].)  Plaintiff argues Defendant GSI’s own Case Management Statement makes no indication as to whether it is willing to participate in arbitration—whether nonbinding judicial arbitration or binding private arbitration, that Defendant did not mention arbitration until June 27, 2022, and Defendant did not file the instant motion until October 12, 2022, nearly four months later.

Plaintiff has not made a showing of unjustifiable delay and Plaintiff does not claim to be prejudiced by the instant motions. Defendant further declares it promptly produced the full Arbitration Agreement before any formal discovery occurred in this matter and indicated that Defendant would seek to enforce arbitration.  (Decl. of Willis ¶¶4-5, Exh. H.)  The record in this case does not reflect that the parties have litigated the merits or the substance of Plaintiff’s arbitrable claims, that any discovery of those claims has occurred, or that Defendant’s actions have impaired Plaintiff’s ability to have the arbitrable disputes in this action resolved fairly through arbitration. Here, Defendant did not waive their right to compel arbitration by invoking “litigation machinery” and taking actions inconsistent with the right to arbitrate.  (St. Agnes Medical Center, 31 Cal.4th at pg. 1196.)  Defendant submitted evidence that it attempted numerous times to meet and confer with Plaintiff’s counsel regarding submitting this matter to arbitration as early as June 27, 2022.  (Decl. of Willis ¶¶3-6, Exhs. I, J.)

Based on the foregoing, Defendant proved the existence of a valid arbitration agreement between the parties that is enforceable by the parties. 

B. Covered Claims

The Arbitration Agreement expressly states that covered claims include “[c]ontroversies or claims subject to arbitration include, without limitation all wage and hour (or related) claims under state law or local law or the federal Fair Labor Standards Act including but not limited to laws governing: wage or hour or labor standards which may include but are not limited to claims involving: meal periods, rest breaks . . .” and “without limiting the foregoing all claims and controversies airing under . . . California Family Rights Act — Cal. Gov’t Code § 12945.2; California Fair Employment and Housing Act — Cal. Gov’t Code § 12900 et seq. . . . [and] the California Labor Code. . . .”  (Decl. of Iheaka, Exh. E §4.)  Based on the foregoing, Defendant met its burden of establishing the Arbitration Agreement covers the causes of action asserted in Plaintiff’s complaint.

In Opposition, Plaintiff argues his claims are outside the scope of the CBA and are not preempted by §301 of the Labor Management Relations Act (“LMRA”).   (Rymel v. Save Mart Supermarkets, Inc. (2018) 30 Cal.App.5th 853, 859 [“When liability is governed by independent state law, the bare fact that a [CBA] will be consulted in the course of state-law litigation is not sufficient to invoke preemption under section 301.”].)  

“Preemption occurs when a claim cannot be resolved on the merits without choosing among competing interpretations of a [CBA] and its application to the claim.”  (Id. at 861, internal citations omitted.)  There is a “two-step inquiry to analyze § 301 preemption of state law claims.”  (Id. at 863, citing Kobold v. Good Samaritan Regional Medical Center (9th Cir. 2016) 832 F.3d 1024, 1032-1033).  “First, a court must determine whether the asserted cause of action involves a right conferred upon an employee by virtue of state law, not by a CBA.”  (Id., internal quotations omitted.)  “If the right exists solely as a result of the CBA, then the claim is preempted, and [the] analysis ends there.”  (Id., internal quotations omitted.)  “If the court determines that the right underlying the plaintiff’s state law claim(s) exists independently of the CBA, it moves to the second step, asking whether the right is nevertheless substantially dependent on analysis of a [CBA].” (Id., internal quotations omitted.)  “Where there is such substantial dependence, the state law claim is preempted by §301. If there is not, then the claim can proceed under state law.”  (Id.)  “[W]hen determining independence from the CBA, the courts focus on the legal character of the claim rather than the underlying set of facts. The question is whether the claim can be resolved by looking to the CBA without the need for interpretation of the CBA.”  (Id.)

State law claims like those asserted by Plaintiff are preempted “if the plaintiff[’s] claim is either grounded in the provisions of the labor contract or requires interpretation of it.”  (Burnside v. Kiewit (9th Cir. 2007) 491 F.3d 1053, 1059.) The LMRA guarantees a “federal right to decide who is to resolve contract disputes.”  (Columbia Export Terminal, LLC v. International Longshore & Warehouse Union (9th Cir. 2022) 23 F.4th 836, 843.)  Therefore, when a claim turns in substance on the provisions of the CBA rather than on an independent statutory right, the claim must be directed to the proper adjudicator.  (Id.)

Each of Plaintiff’s causes of action are identified in the CBA: Labor Code, Fair Employment and Housing Act, California Family Rights Act, and the Business and Professional Code.  (Decl. of Iheaka, Exh. B, Amendment #2, pg. 2.) Moreover, Plaintiff’s causes of action involve rights that do not exist beyond the purview of the CBA, including but not limited to Article 16, concerning Defendant GSI’s and Local 22’s anti-discrimination policy and GSI’s management rights pertaining to Plaintiff’s employment; Article 5 concerning the meal and rest break policy Plaintiff was subject to during his employment; Article 8 concerning time off related to Plaintiff’s reasonable accommodation claim; and Article 10 concerning termination.  (Decl. of Iheaka, Exh. B.)  The resolution of Plaintiff’s claims depends upon, and would require this Court to author, binding interpretations of the CBA.  Any such interpretation would destroy the specific promise to arbitrate grievances made by Plaintiff and the Union and would invade the province of the arbitrator.  Plaintiff’s claims are subject to the arbitration provision.

C.  Unconscionability

Plaintiff argues the arbitration agreement is procedurally and substantively unconscionable.  (Opposition, pgs. 14-17.)  Defendant contends Armendariz  does not apply here.  Assuming it applies, the CBA is enforceable. “[P]rocedural and substantive unconscionability must both be present in order for a court to exercise its discretion to refuse to enforce a contract or clause under the doctrine of unconscionability.”  (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 102.) Plaintiff bears the burden of proving that the provision at issue is both procedurally and substantively unconscionable. 

1. Procedural Unconscionability

    

   “Procedural unconscionability focuses on the elements of oppression and surprise. [Citations] ‘Oppression arises from an inequality of bargaining power which results in no real negotiation and an absence of meaningful choice . . . Surprise involves the extent to which the terms of the bargain are hidden in a ‘prolix printed form’ drafted by a party in a superior bargaining position.’ [Citations]”  (Roman v. Superior Court (2009) 172 Cal.App.4th 1462, 1469.)

    

   Plaintiff argues that the arbitration agreement is procedurally unconscionable because: (1) assuming Plaintiff was a member of Local 22, the CBA was given to Plaintiff on a take-it-or-leave it basis, (2) the terms of Plaintiff’s employment were imposed on Plaintiff as a condition of his employment with GSI as expressly stated in the CBA, (3) Plaintiff was never provided a copy of the CBA and was on medical leave when Amendment #2 was executed and could not have received notice and could not have understood the contents of Amendment #2 because of a language barrier, (4) Plaintiff was never given the opportunity to object to the CBA or Amendment #2, (5) no one from Local 22 or Defendant GSI ever went over the terms of the CBA with Plaintiff, (6) there is no mention in the CBA of both parties’ waiver of a right to a jury trial, and (7) there are no rules for discovery or any other process in the purported agreement.  (Opposition, pgs. 15-16.)

    

   Procedural unconscionability “focuses on the unequal bargaining positions and hidden terms common in the context of adhesion contracts.”  (24 Hour Fitness, Inc. v. Superior Court (1998) 66 Cal.App.4th 1199, 1212-1213.)  “It is well settled that adhesion contracts in the employment context, that is, those contracts offered to employees on a take-it-or-leave-it basis, typically contain some aspects of procedural unconscionability. . .[w]hen, as here, there is no other indication of oppression or surprise, the degree of procedural unconscionability of an adhesion agreement is low, and the agreement will be enforceable unless the degree of substantive unconscionability is high.” (Peng v. First Republic Bank (2013) 219 Cal. App. 4^th 1462, 1470 (internal quotation marks and citations omitted.)

    

   Plaintiff does not establish the mandatory nature of an agreement to arbitrate as a condition of employment establishes more than minimal procedural unconscionability “Nothing in the law suggests a distinction between the status of arbitration agreements signed by an individual employee and those agreed to by a union representative.”  (14 Penn Plaza, 556 U.S. at pg. 258.)  Plaintiff signed his application for membership in Union 22 authorizing the union to represent him for the purpose of collective bargaining, thereby waiving his individual right to negotiate the terms of arbitration with his employer, including the right to a jury trial and the extent of discovery.  (Decl. of Iheaka, Exh. A.)

    

   Based on the foregoing, the Court finds the Arbitration Agreement is minimally procedurally unconscionable.  However, as discussed below, the Court finds the arbitration agreement is not substantively unconscionable. 

    

2. Substantive Unconscionability

    

   “Substantive unconscionability focuses on the actual terms of the agreement and evaluates whether they create ‘overly harsh’ or ‘‘one-sided’ results’ [Citations] that is, whether contractual provisions reallocate risks in an objectively unreasonable or unexpected manner.  [Citation] Substantive unconscionability ‘may take various forms,’ but typically is found in the employment context when the arbitration agreement is ‘one-sided’ in favor of the employer without sufficient justification, for example, when ‘the employee’s claims against the employer, but not the employer’s claims against the employee, are subject to arbitration.’ [Citations].”  (Roman, 172 Cal.App.4th at pgs. 1469-1470.)  In determining whether an arbitration agreement is unconscionable, the Court considers whether the agreement: (1) provides for a neutral arbitrator; (2) provides for reasonable discovery; (3) requires a written award; (4) provides for the same remedies that otherwise would be available in court; and (5) does not require employees to bear costs unique to arbitration.  (See Armendariz, 24 Cal.4th at pgs. 102-103.)

    

   Plaintiff argues the Arbitration Agreement is substantively unconscionable because it (1) completely bans class action lawsuits, and (2) the CBA is replete with unilateral language confirming Plaintiff’s agreement to be bound by the contract in the sense that all of the claims covered by the agreement are the types that only an employee would bring, confirming the agreement lacks mutuality.  (Opposition, pgs. 16-17.)  The existence of a class action waiver does not create substantive unconscionability for Plaintiff’s claims which includes no class claims.  Nor does Plaintiff establish that the CBA lacks mutuality.

    

   Finally, the CBA provides for the following: (1) relief that would otherwise be available in the court of law (Decl. of Iheaka, Exh. B, Amendment #2, pg. 2), (2) review of arbitration decisions and appeals (Decl. of Iheaka, Exh. B, pg. 17, 4(b)), and (3) a neutral arbitrator, either mutually selected by the employee-nominated and selected union representative and GSI chief executive officer or by the American Arbitration Association.  (Decl. of Iheaka, Exh. B, pg. 17, 4(a).) 

   The Arbitration Agreement states that “[t]he fees and expenses incident to the services of the arbitrator shall be shared equally between the Company and the Union,” requiring employees to bear costs unique to arbitration.  (Decl. of Iheaka, Exh. B at pg. 17.)  This does not require the employee to pay for the arbitration, but rather the union.  With regards to discovery, the Arbitration Agreement states that “Article 17, Section 4 Arbitration shall have the following additional provisions appended thereto: (h) . . . In a hearing regarding a wage and hour grievance, or other claim under state, local, or federal law, the Arbitrator may order any discovery deemed necessary to explore the disputed issues and address any discovery issues that may rise,” suggesting discovery is only permitted in wage and hour claims.  (Decl. of Iheaka, Exh. E at pg. 3.) The Court is satisfied that the agreement is not substantively unconscionable.

    

   Accordingly, the motion to compel arbitration is granted.

    

1. Stay of Current Action

Pursuant to Code of Civil Procedure section 1281.4, if an application has been made to a court involving order to arbitrate a controversy and such application is undetermined, the court where the application is pending shall, upon motion of a party to the action, stay the action until the application for an order to arbitrate is determined.  (C.C.P. §1281.4.)

Accordingly, this case is stayed pending arbitration.

1. Conclusion

Defendant GSI’s motion to compel arbitration is granted.  The case is stayed pending arbitration. The Court sets a non-appearance case review for February 9, 2024, at 8:30 a.m.  The parties are directed to submit a joint statement five calendar days in advance, apprising the Court of the status of the arbitration.

Dated:  February _____, 2023

Hon. Monica Bachner

Judge of the Superior Court