Judge Randolph M. Hammock, Case Number: 23STCV22143, Date: 2024-05-02 Tentative Ruling

Judge: Randolph M. Hammock, Case: 23STCV22143, Date: 2024-05-02 Tentative Ruling

“[T]he petitioner bears the burden of proving the existence of a valid arbitration agreement by the preponderance of the evidence . . . .” (Giuliano v. Inland Empire Personnel, Inc. (2007) 149 Cal.App.4th 1276, 1284). “In determining whether an arbitration agreement applies to a specific dispute, the court may examine only the agreement itself and the complaint filed by the party refusing arbitration [citation]. The court should attempt to give effect to the parties' intentions, in light of the usual and ordinary meaning of the contractual language and the circumstances under which the agreement was made.” (Weeks v. Crow (1980) 113 Cal.App.3d 350, 353). “Doubts as to whether an arbitration clause applies to a particular dispute are to be resolved in favor of sending the parties to arbitration. The court should order them to arbitrate unless it is clear that the arbitration clause cannot be interpreted to cover the dispute.” (California Correctional Peace Officers Ass'n v. State (2006) 142 Cal.App.4th 198, 205).

“[A] party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense. [Citation.] In these summary proceedings, the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court's discretion, to reach a final determination.” (Giuliano v. Inland Empire Personnel, Inc. (2007) 149 Cal.App.4th 1276, 1284).

“If a court of competent jurisdiction, whether in this State or not, has ordered arbitration of a controversy which is an issue involved in an action or proceeding pending before a court of this State, the court in which such action or proceeding is pending shall, upon motion of a party to such action or proceeding, stay the action or proceeding until an arbitration is had in accordance with the order to arbitrate or until such earlier time as the court specifies. . . .” (CCP § 1281.4.)

The FAA provides for enforcement of arbitration provisions in any contract “evidencing a transaction involving commerce.” (9 USC § 2.) The term “involving commerce” is functionally equivalent to “affecting commerce” and “signals an intent to exercise Congress’ commerce power to the full.” (Allied-Bruce Terminix Cos., Inc. v. Dobson (1995) 513 US 265, 277.) “The party asserting the FAA bears the burden to show it applies by presenting evidence establishing [that] the contract with the arbitration provision has a substantial relationship to interstate commerce . . . .” (Carbajal v. CWPSC, Inc. (2016) 245 Cal.App.4th 227, 238.)

Arguing the transaction here involved commerce, Defendant presents evidence that Defendant Bridge manages rental properties located in California, and “utilizes goods and services from other states, including building materials and supplies like toilets, drywall, lumber, paint, plumbing supplies, roofing materials, flooring materials, etc.” (Wilson Decl. ¶ 4.) In addition, Bridge “receives federal financial assistance for Section 8 tenants.” (Id.)

Considering this evidence—and without argument to the contrary—this court concludes that Defendant has evidenced a transaction involving commerce. Therefore, the FAA applies here.

California has a strong public policy in favor of arbitration as an expeditious and cost-effective way of resolving disputes. “Even so, parties can only be compelled to arbitrate when they have agreed to do so.” (Avila v. S. California Specialty Care, Inc. (2018) 20 Cal. App. 5th 835, 843.) “The party seeking to compel arbitration bears the burden of proving the existence of a valid arbitration agreement.” (Id.)

An arbitration agreement is a contractual agreement. “General contract law principles include that ‘[t]he basic goal of contract interpretation is to give effect to the parties’ mutual intent at the time of contracting. [Citations.] ... The words of a contract are to be understood in their ordinary and popular sense.” [Citations.] (Garcia v. Expert Staffing W., 73 Cal. App. 5th 408, 412–13.)

Defendant has the initial burden of producing “prima facie evidence of a written agreement to arbitrate the controversy.” (Gamboa v. Ne. Cmty. Clinic (2021) 72 Cal. App. 5th 158, 165.) “[I]t is not necessary to follow the normal procedures of document authentication.” (Condee v. Longwood Mgmt. Corp. (2001) 88 Cal. App. 4th 215, 218.)

Defendant submits a declaration from Sherri Wilson, who is the Director of Human Resources for Defendant Bridge. (See Wilson Decl.) Wilson represents that as part of Plaintiff’s employment with Defendant, Plaintiff entered into a “Residential Manager Employment Agreement” on January 10, 2023. (See Wilson Decl., ¶ 9, Exh. D.) The Agreement [FN 3] contains a paragraph entitled “Arbitration of Disputes,” which provides in full:

Any dispute, claim or grievance arising out of relating of Employee's employment, or out of the Interpretation or applicability of this Agreement, shall be submitted to binding arbitration pursuant to the Employment Arbitration Rules of the American Arbitration Association. The parties hereby specifically agree to arbitrate any and all claims arising out of Employee’s employment under this Agreement or the termination thereof, including any and all statutory claims based on all applicable federal and state anti-discrimination, wage payment, and other employment laws. The parties agree to accept the Arbitrator's award ad [sic] final and binding as to any matters properly submitted to arbitration under Agreement.

In Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. 639, the Supreme Court held that the Federal Arbitration Act (“FAA”) mandates the arbitration of a plaintiff’s individual PAGA claims where an agreement to arbitrate exists, abrogating Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal. 4th 348.

Thus, considering this evidence, Defendant has established the existence of an agreement to arbitrate that covers the individual PAGA claims here. (See Vianna v. Doctors’ Management Co. (1994) 27 Cal.App.4th 1186, 1189 [noting that “arbitration agreements should be liberally interpreted, and arbitration should be ordered unless the agreement clearly does not apply to the dispute in question”].) Because Plaintiff has not challenged the existence or authenticity of the agreement, nothing more is required.

Plaintiff, as the party opposing arbitration, has the burden of presenting any defenses to enforcement. Plaintiff has not opposed the motion, and thus, has not done so. (Crippen v. Central Valley RV Outlet (2004) 124 Cal.App.4th 1159, 1164 [once a defendant proves an agreement to arbitrate exists, “[t]he opposing party then must prove any defense to enforcement of the arbitration agreement. [Citation.]”)

It is now settled in California that where a Plaintiff’s individual PAGA claims are sent to arbitration, the Plaintiff maintains standing to litigate the non-individual claims in court. (See Adolph v. Uber Techs., Inc. (2023) 14 Cal. 5th 1104, 1123.) As to how the matter should proceed procedurally, “a court ordinarily has inherent power, in its discretion, to stay proceedings when such a stay will accommodate the ends of justice.’ (People v. Bell (1984) 159 Cal.App.3d 323, 329.) As the Court in Landis v. North American Co. (1936) 299 U.S. 248, 254, explained, ‘the power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants.” (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 141; see also Frieberg v. City of Mission Viejo (1995) 33 Cal.App.4th 1481, 1489 [“Trial courts generally have the inherent power to stay proceedings in the interests of justice and to promote judicial efficiency.”].)

Here, arbitration of Plaintiff’s individual claims will involve similar issues to the litigation of her non-individual claims. A stay will avoid duplicative proceedings of the same or similar issues, preserve authority of the arbitrator, and conserve the time and resources of the parties and this court. Importantly, there is no evidence Plaintiff or the alleged aggrieved employees will be unduly prejudiced by the stay.

FN 2- Defendant served the moving papers on Plaintiff by email on April 05, 2024. (See Proof of Service.)

FN 3- Defendant also relies on the existence of another arbitration agreement and addendum Plaintiff entered into with Defendant Pama Management, Inc., who has been dismissed from this lawsuit. (Wilson Decl., Exhs. A & B.) Only Plaintiff and Pama Management are parties to that agreement. It is unclear what relationship, if any, exists between Pama Management, Inc., and the moving Defendant. Defendant does not explain in the moving papers why the agreement between Plaintiff and Pama Management has any bearing on the instant motion. The court therefore will not consider that agreement, and instead relies solely on the most recent agreement between Plaintiff and Defendant Bridge. (Wilson Decl., Exh. D.)