Judge: Robert B. Broadbelt, Case: 24STCV12237, Date: 2025-01-13 Tentative Ruling

Case Number: 24STCV12237    Hearing Date: January 13, 2025    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTY:                Defendant Netflix, Inc.     

RESPONDING PARTY:       Plaintiff Neena Dass

Motion to Compel Arbitration and Stay Proceedings

The court considered the moving, opposition, and reply papers filed in connection with this motion.

DISCUSSION

Defendant Netflix, Inc. (“Defendant”) moves the court for an order (1) compelling plaintiff Neena Dass (“Plaintiff”) to arbitrate her claims in this action, and (2) staying this action pending completion of arbitration.

1.     Applicability of the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act

As a threshold matter, the parties dispute the application of the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (9 U.S.C. §§ 401-402) (the “EFAA”) to this action.  For the reasons set forth below, the court finds that the EFAA does not apply.

“In 2022, Congress amended the Federal Arbitration Act (FAA) by passing the [EFAA].  In general terms, the EFAA renders arbitration agreements unenforceable at the plaintiff’s election in sexual assault and sexual harassment cases that arise or accrue on or after March 3, 2022, the EFAA’s effective date.”  (Doe v. Second Street Corp. (2024) 105 Cal.App.5th 551, 559.)  Thus, under the Federal Arbitration Act (9 U.S.C. § 1 et seq.) (the “FAA”), “[a] written provision in . . . a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract or as otherwise provided [by the EFAA].”  (9 U.S.C. § 2.)  

Because the EFAA is part of the FAA, the court finds that it is applicable to arbitration proceedings, including motions to compel arbitration, that are governed by the FAA.  (Doe, supra, 105 Cal.App.5th at p. 559 [explaining that Congress amended the FAA by passing the EFAA]; 9 U.S.C. § 2 [providing that arbitration agreements are valid and enforceable except as otherwise provided by the EFAA],)  However, the parties did not submit evidence or present argument establishing that the FAA applies to the subject arbitration agreement and the pending motion.[1]

“The party asserting the FAA applies to an agreement has ‘the burden to demonstrate FAA coverage by declarations and other evidence.’”  (Evenskaas v. California Transit, Inc. (2022) 81 Cal.App.5th 285, 292.)  “‘The FAA’s basic coverage provision, section 2, makes the FAA applicable to contracts “evidencing a transaction involving commerce.”  (9 U.S.C. § 2.)  Courts broadly construe section 2 to “provide for the enforcement of arbitration agreements within the full reach of the Commerce Clause.”  [Citation.]  “Accordingly, in most cases, the FAA mandates arbitration when contracts involving interstate commerce contain arbitration provisions.” ’  [Citations.]”  (Mendoza v. Trans Valley Transport (2022) 75 Cal.App.5th 748, 761-762; 9 U.S.C. § 2.)  “The United States Supreme Court has identified ‘three categories of activity that Congress may regulate under its commerce power: (1) “the use of the channels of interstate commerce”; (2) “the instrumentalities of interstate commerce, or persons or things in interstate commerce, . . .”; and (3) “those activities having a substantial relation to interstate commerce, . . . i.e., those activities that substantially affect interstate commerce.” ’  [Citations.]”  (Evenskaas, supra, 81 Cal.App.5th at p. 293.) 

Neither Plaintiff nor Defendant submitted evidence establishing that the subject employment agreement between Plaintiff and Defendant is a contract that evidences a transaction involving commerce.  (9 U.S.C. § 2.)  The parties did not, for example, submit declarations to show that (1) Defendant is engaged in activities that have a substantial relation to interstate commerce, or (2) Plaintiff, in her employment with Defendant, carried out her job duties by engaging in such activities.  (Evenskaas, supra, 81 Cal.App.5th at p. 293; Valencia v. Smyth (2010) 185 Cal.App.4th 153, 174-174 [“if a contract involves interstate commerce, the FAA’s substantive provision (9 U.S.C. § 2) applies to the arbitration”] [emphasis in original].)  The court further notes that the parties did not agree to incorporate the substantive (or procedural) provisions of the FAA into their arbitration agreement.  Specifically, the parties’ “Agreement Regarding Your Netflix Employment (Including Mutual Agreement to Arbitrate)” (the “Arbitration Agreement”) states that the parties have “agree[d] to arbitrate under California law (including California’s arbitration rules) . . . .”  (Sotomayor Decl., Ex. B, Arbitration Agreement, p. 2, ¶ 8.)  Thus, the Arbitration Agreement does not incorporate by its terms the FAA. 

The court therefore finds that Plaintiff has not met her burden to show that the EFAA applies to the pending motion to compel arbitration.  (Compare with Doe, supra, 105 Cal.App.5th at p. 563 [applying the EFAA when the parties’ arbitration provision “stated that the arbitrability of any claim shall be determined according to the substantive provisions of the FAA and the procedural provisions of the CAA”]; Liu v. Miniso Depot CA, Inc. (2024) 105 Cal.App.5th 791, 801 [applying the FAA to the parties’ dispute because the parties’ arbitration agreement provided that the interpretation, applicability, validity, and enforceability thereof is governed by the FAA].)

2.     Existence of Agreement to Arbitrate

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party to the agreement refuses to arbitrate that 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[,]” unless the court finds that the right to compel arbitration has been waived by the petitioner or that grounds exist for rescission of the agreement.¿ (Code Civ. Proc., §¿1281.2.)¿¿¿¿¿¿ 

“‘ “The party seeking to compel arbitration bears the burden of proving the existence of an arbitration agreement, while the party opposing the petition bears the burden of establishing a defense to the agreement’s enforcement.” ’”¿ (Beco v. Fast Auto Loans (2022) 86 Cal.App.5th 292, 302.)¿ To determine the existence of an arbitration agreement, the court uses “a three-step burden-shifting process.”¿ (Iyere v. Wise Auto Group (2023) 87 Cal.App.5th 747, 755.)¿ “The arbitration proponent must first recite verbatim, or provide a copy of, the alleged agreement.¿ [Citations.]¿ A movant can bear this initial burden ‘by attaching a copy of the arbitration agreement purportedly bearing the opposing party’s signature.’”¿ (Ibid. [internal citations omitted].)¿ “If the movant bears its initial burden, the burden shifts to the party opposing arbitration to identify a factual dispute as to the agreement’s existence . . . .”¿ (Ibid.)¿ If the opposing party meets its burden to “submit sufficient evidence to create a factual dispute” as to the existence of the agreement, the burden shifts back to the arbitration proponent, who retains the ultimate burden of proving its existence by a preponderance of the evidence.¿ (Ibid.; Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 165-166.)¿¿ 

First, the court finds that Defendant has met its burden to show that there exists an agreement to arbitrate this controversy.  (Iyere, supra, 87 Cal.App.5th at p. 755.)

Defendant has submitted the Arbitration Agreement, which (1) was electronically signed by Plaintiff on December 25, 2018, and (2) provides that the parties agreed to arbitrate “any claim for breach of this Agreement and all employment related disputes, including claims under state or federal law.”  (Sotomayor Decl., Ex. B, Arbitration Agreement, ¶ 8, and p. 2.)  Thus, the court finds that Defendant has met its initial burden to produce prima facie evidence of an agreement to arbitrate.  The court further finds that the claims alleged in Plaintiff’s Complaint, which arise from her employment with Defendant and, specifically, the alleged harassment, discrimination, and retaliation of Plaintiff, Defendant’s failure to prevent the harassment, discrimination, and retaliation of Plaintiff, and Defendant’s violation of the Labor Code based on its failure to pay Plaintiff the same rate as her counterparts, are encompassed by the Arbitration Agreement since they arise from “employment related disputes” between the parties.  (Ibid.; Compl., ¶¶ 31, 39, 44, 50-51, 57, 64, 69, 76, 80-82.)

Second, the court finds that Plaintiff did not meet her burden (1) to identify a factual dispute as to the authenticity of the Arbitration Agreement or her electronic signature thereon, or (2) to establish a defense to the enforcement of the Arbitration Agreement.  (Iyere, supra, 87 Cal.App.5th at p. 755.)

Plaintiff did not submit evidence, such as her declaration, asserting that she did not sign the Arbitration Agreement or that it is inauthentic or invalid for any other reason.  Thus, the court finds that Plaintiff did not meet her burden to identify a factual dispute as to the authenticity of the Arbitration Agreement.  The court further finds that Plaintiff has not met her burden to present a defense to the enforcement of the Arbitration Agreement because (1) as set forth above, Plaintiff did not show that the EFAA applies to this motion, and (2) Plaintiff did not present evidence and argument to establish that the Arbitration Agreement is unenforceable for any other reason, such as unconscionability.  (Beco, supra, 86 Cal.App.5th at p. 302 [the opposing party bears the burden of establishing a defense]; OTO, LLC v. Kho (2019) 8 Cal.5th 111, 126 [“The burden of proving unconscionability rests upon the party asserting it”].)

Thus, the court finds that (1) Defendant has met its burden to prove that an agreement to arbitrate the controversy in Plaintiff’s Complaint exists, and (2) Plaintiff has not met her burden to show that the Arbitration Agreement is invalid or should not be enforced.  The court therefore grants Defendant’s motion.  (Code Civ. Proc., § 1281.2.)

ORDER

            The court grants defendant Netflix, Inc.’s motion to compel arbitration and stay proceedings.

            The court orders (1) defendant Netflix, Inc. and plaintiff Neena Dass to arbitrate the claims alleged in plaintiff Neena Dass’s Complaint, and (2) this action is stayed until arbitration is completed.

The court sets an Order to Show Cause re completion of arbitration for hearing on August 12, 2025, at 8:30 a.m., in Department 53. 

            The court orders defendant Netflix, Inc. to give notice of this ruling.

IT IS SO ORDERED.

DATED:  January 13, 2025

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court