Judge: Monica Bachner, Case: 22STCV17992, Date: 2023-03-07 Tentative Ruling

Department 71: Attorneys who elect to submit on these published tentative rulings, without making an appearance at the hearing, may so notify the Court by communicating this to the Department's staff at (213) 830-0771 before the set hearing time.  See, e.g., CRC Rule 324(b).   All parties are otherwise encouraged to appear by Court Call for all matters.

Case Number: 22STCV17992    Hearing Date: March 7, 2023    Dept: 71

Superior Court of California

County of Los Angeles

DEPARTMENT 71

TENTATIVE RULING

Defendant Interior Removal Specialist, Inc.’s, motion to compel arbitration of Plaintiff Jose Campos’ individual claims and individual PAGA claim in this action is continued to March 21, 2023 at 10:30 a.m. for an evidentiary hearing.

Defendant Interior Removal Specialist, Inc. (“IRS”) (“Defendant”), moves for an order compelling arbitration of Plaintiff Jose Campos’ (“Campos”) (“Plaintiff”) individual claims and individual California Private Attorneys General Act of 2004 (“PAGA”) claim in this action and dismissing Plaintiff’s representative claims on behalf of other allegedly aggrieved employees.  (Notice of Motion, pg. 2.) 

C.R.C. Violations

The C.R.C. contemplates only moving, opposition, and reply papers.  (C.R.C., Rule 3.1113(d).)  Sur-replies are not contemplated by the rules and are thus not permitted.  Plaintiff’s sur-reply was filed without leave of this Court and as such will not be considered.

Evidentiary Objections

Plaintiff’s 2/22/23 evidentiary objections to the Declaration of Maria Vasquez (“Vasquez”) are overruled as to Nos. 1, 2, 3, 4, and 7, and sustained as to Nos. 5 and 6.

Plaintiff’s 3/1/23 evidentiary objection to the 2/28/23 Declarations of Vasquez,  Javier Perez (“Perez”), Ismael Santacruz (“Santacruz”), and Eduardo Sanchez (“Sanchez”) are overruled.

Background

On June 1, 2022, Plaintiff filed the instant action for (1) retaliation in violation of Labor Code §98.6; (2) retaliation in violation of Labor Code §§1102.5, 1102.6, 6310; (3) wrongful termination in violation of public policy; (4) failure to pay wages in violation of Labor Code §§201, 226.7, 510, 1194, 1197; (5) failure to pay minimum wages in violation of Labor Code §§1182.12, 1194, 1194.2, 1197; (6) failure to pay overtime compensation in violation of Labor Code §§510, 1194; (7) failure to provide meal and rest periods in violation of Labor Code §§226.7, 512; (8) failure to provide itemized wage and hour statements in violation of Labor Code §§226, 226.3, 1174, et seq.; (9) waiting time penalties under Labor Code §§201-203; (10) PAGA under Labor Code §§2699 et seq.; and (11) unfair competition under Business & Professional Code §17200 et seq. against Defendant in connection with Plaintiff’s employment by Defendant as a general laborer and his alleged wrongful termination on or about January 27, 2022.  (Complaint ¶16.)  Defendant filed the instant motion on October 19, 2022.  Plaintiff filed his opposition on February 22, 2023.  Defendant filed its reply on February 28, 2023.  Plaintiff filed an improper and unauthorized sur-reply on March 1, 2023, which has not been considered by the Court.

Motion to Compel Arbitration

A.  Arbitration Agreement

Federal law provides for enforcement of this Arbitration Agreement. The Federal Arbitration Act, 9 U.S.C. §1, et seq. (“FAA”), establishes a strong federal policy in favor of arbitration of disputes where a written arbitration agreement exists. Section 2 of the FAA provides, in pertinent part that “[a] written provision . . . to settle by arbitration a controversy thereafter arising out of such contract . . .  shall be valid, irrevocable, and enforceable.” (9 U.S.C. §2.)  The purpose of the FAA is to “reverse the longstanding judicial hostility to arbitration agreements.” (Gilmer v. Interstate/Johnson Lane Corp. (1991) 500 U.S. 20, 24.)  The FAA places arbitration agreements “on an equal footing with other contracts and [requires courts] to enforce them according to their terms.”  (AT&T Mobility, LLC v. Concepcion (2011) 563 U.S. 333, 339; see also Rent-A-Center West, Inc. v. Jackson (2010) 561 U.S. 63, 67 [“The FAA reflects the fundamental principle that arbitration is a matter of contract.”].)  The FAA will preempt not only a state law that “discriminat[es] on its face against arbitration,” but also a state law that “covertly accomplishes the same objective by disfavoring contracts that (oh so coincidentally) have the defining features of arbitration agreements.”  (Kindred Nursing Centers Limited Partnership v. Clark (2017) 137 S.Ct. 1421, 1426.)

The United States Supreme Court has specifically held that the FAA applies to employment contracts: “[A]s a matter of law the answer is clear.  In the Federal Arbitration Act, Congress has instructed federal courts to enforce arbitration agreements according to their terms.”  (Epic Systems Corp. v. Lewis (2018) 138 S.Ct. 1612, 1619, [holding that employees must submit to arbitration agreements including those with collective action waivers].)  Here, the FAA is applicable to the Arbitration Agreement executed by Plaintiff because the Arbitration Agreement confirms it is governed by the FAA.  (Decl. of Vasquez ¶5, Exh. A at pg. 2; Broughton v. Cigna Healthplans (1999) 21 Cal.4th 1066, 1074, 1075.)

The FAA restricts a court’s inquiry related to compelling arbitration to two threshold questions: (1) whether there was an agreement to arbitrate between the parties; and (2) whether the agreement covers the dispute.  (Howsam v. Dean Witter Reynolds, Inc. (2002) 537 U.S. 79, 84.)  Here, both criteria are satisfied. First, Plaintiff agreed to arbitration when he signed the Arbitration Agreement.  (Decl. of Vasquez ¶5, Exh. A.)  Second, the Arbitration Agreement expressly covers employment claims between Plaintiff and Defendant.  (Decl. of Vasquez, Exh. A at pg. 1.) 

California law also favors arbitration for dispute resolution. The California Arbitration Act (“CAA”), codified at C.C.P. §1281 et seq., provides, “A written agreement to submit to arbitration an existing controversy or a controversy thereafter arising is valid, enforceable and irrevocable, save upon such grounds as exist for the revocation of any contract.” (C.C.P. §1281; see also Grafton Partners L.P. v. Superior Court (2005) 36 Cal.4th 944, 955 [“[U]nlike predispute jury waivers, predispute arbitration agreements are specifically authorized by statute.”].) 

“California law, like federal law, favors enforcement of valid arbitration agreements.” (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 97, 99 [“Armendariz”].)  The public policy in favor of arbitration is so strong that California courts have held that an employee is “bound by the provisions of the [arbitration] agreement regardless of whether [he] read it or [was] aware of the arbitration clause when [he] signed the document.”  (Brookwood v. Bank of America (1996) 45 Cal.App.4th 1667, citing Macaulay v. Norlander (1992) 12 Cal.App.4th 1.)  The only prerequisite for a court to order arbitration is a determination that the parties have entered into an agreement to arbitrate the dispute.  (United Transportation Union v. Southern California Rapid Transit District (1992) 7 Cal.App.4th 804, 808.)  Thus, arbitration must be ordered “unless the agreement clearly does not apply to the dispute in question.”  (Vianna v. Doctors’ Management Co. (1994) 27 Cal.App.4th 1186, 1189.)  If there is any reasonable doubt concerning the validity of the arbitration agreement, it must be resolved in favor arbitration.  (Coast Plaza Doctors Hospital v. Blue Cross of California (2000) 83 Cal.App.4th 677, 687.)

Defendant proved the existence of an arbitration agreement with Plaintiff.  Defendant submitted evidence that Plaintiff entered into a Mutual Agreement to Arbitrate (“Arbitration Agreement”), which Plaintiff signed on March 22, 2021.  (Decl. of Vasquez ¶5, Exh. A.) 

The Arbitration Agreement provides,

[Defendant] . . . and [Plaintiff] voluntarily agree to the resolution by arbitration of all claims, disputes, and/or controversies (collectively “claims”), whether or not arising out of [Plaintiff’s] employment or termination of employment, that [Defendant] may have against [Plaintiff] or that [Plaintiff] may have against [Defendant] or against its employees or agents in their capacity as employees or agents. The claims covered by this Arbitration Agreement include, but are not limited to claims for wages or other compensation due . . . and claims for violation of any federal, state, or other governmental law, statute, regulation or ordinance, except claims specifically excluded below.

. . .

[Plaintiff] and [Defendant] expressly intend and agree that each will forego pursuing any covered dispute on a class, collective, or representative basis and will not assert class, collective, or representative action claims against the other in arbitration or otherwise. [Plaintiff] and [Defendant] shall only submit their own, individual claims in arbitration. . . .

. . .

Claims that [Plaintiff] may have for workers’ compensation or for unemployment compensation benefits, or that [Defendant] or [Plaintiff] may have for injunctive relief are not covered by this Agreement. Additionally, nothing in this Agreement shall preclude [Plaintiff] from filing a complaint or charge with the Equal Employment Opportunity Commission (EEOC), the U.S. Department of Labor (DOL), the National Labor Relations Board (NLRB), the California Department of Fair Employment and Housing (DFEH), the California Division of Labor Standards Enforcement (DLSE), or any other applicable local, state, or federal agency. [Plaintiff] is required to take any steps necessary where required by law to first exhaust administrative remedies prior to initiating a claim for arbitration. Any claim that cannot be administratively resolved before an applicable agency will be subject to arbitration. . . .

. . .

If any provision of this Agreement is adjudged to be void or otherwise unenforceable, in whole or in part, such adjudication shall not affect the

validity of the remainder of the Agreement. The parties expressly agree that the remainder of the Agreement should be enforced as written with the excision of the invalid provision only.

. . .

[Plaintiff] acknowledges that [Plaintiff] has carefully read this Arbitration Agreement, that [Plaintiff] understands its terms, that all understandings and agreements between [Defendant] and [Plaintiff] relating to the subjects covered in the Agreement are contained in it, and that [Plaintiff] has entered into the Agreement voluntarily and not in reliance on any promises or representations by [Defendant] other than those contained in this Agreement.

(Decl. of Vasquez, Exh. A at pgs. 1-2, 4 (emphasis added).)

          The Court finds that the broad language of the Arbitration Agreement covers the scope of Plaintiff’s individual PAGA claim because it arises from his employment with the Defendant.  Plaintiff does not deny signing the Arbitration Agreement.  (See Opposition, pg. 5.) 

Plaintiff opposes the motion to compel arbitration on the basis that Plaintiff was coerced into the signing the Agreement when Defendant’s representative, Javier Perez (“Perez”), told Plaintiff that if Plaintiff did not sign the document, he would lose his job, or his hours would be cut.  (Opposition, pg. 5.)  

In support of this claim, Plaintiff declares his supervisor, Perez, forbade him from taking the Arbitration Agreement home or using his cell phone photograph the document.  (Decl. of Campos ¶5.)  Perez declares it is Defendant’s practice is to permit employees to take the Agreement home and witnesses have testified as such.  (Decl. of Perez ¶7; Decl. of SantaCruz ¶5; Decl. of Sanchez ¶5.)  Perez also declares he encouraged individuals to review the Agreement with an attorney.  (Decl. of Perez ¶7.)  Defendant also produced evidence of Perez’s Excel spreadsheet that indicates on March 19, 2021, Plaintiff was 1 of the 41 employees who took the Arbitration Agreement home for review.  (2/28/22 Decl. of Vasquez ¶¶9-10, Exh. D.)  Plaintiff also asserts that Perez fraudulently told him and his co-workers that the Arbitration Agreement will not prevent them from filing a lawsuit in court.  (Decl. of Campos, ¶ 3.)   However, Defendant presented evidence that it is its practice is to inform employees verbally and in writing that accepting the agreement will require all disputes to be subject to arbitration and is supported by other witnesses.  (Decl. of Perez ¶5; Decl. of SantaCruz ¶5; Decl. of Sanchez ¶5.)  Finally, Plaintiff’s allegation that Perez threatened him to sign the Agreement (Decl. of Campos, ¶ 7) is contradicted by the declarations of witnesses who dispute Plaintiff’s allegation and declared that they felt Perez treated them with respect and never saw Perez threatening employees.  (Decl. of SantaCruz ¶6; Decl. of Sanchez ¶6.)  The Court finds a hearing is required in light of the conflicting evidence.

Dated:  March _____, 2023

Hon. Monica Bachner

Judge of the Superior Court