Judge Ronald F. Frank, Case Number: 24TRCV02864, Date: 2024-11-05 Tentative Ruling

Judge: Ronald F. Frank, Case: 24TRCV02864, Date: 2024-11-05 Tentative Ruling

Case Number: 24TRCV02864 Hearing Date: November 5, 2024 Dept: 8

Tentative Ruling

HEARING DATE: November 5, 2024¿

CASE NUMBER: 24TRCV02864

CASE NAME: Francisco Lopez v. Brightview Landscapes, LLC, et al.

MOVING PARTY: Defendant, Brightview Landscapes, LLC erroneously sued as Brightview Landscapes, LLP.

RESPONDING PARTY: Plaintiffs, Francisco Lopez

TRIAL DATE: Not Set

MOTION:¿ (1) Motion to Compel Arbitration

Tentative Rulings: (1) GRANTED. The Court did not consider the Reply declaration in making its tentative ruling, but would consider continuing the hearing until its next available date, December 31, 2024, when the Court could consider the defense supplemental declaration and afford Plaintiff the opportunity to file a sur-reply to address the new matters raised for the first time by Defendant with its reply.

I. BACKGROUND¿

A. Factual¿

On August 28, 2024, Plaintiff, Francisco Lopez (“Plaintiff”) filed a complaint against Defendant, Brightview Landscapes LLC and DOES 1 through 50. The Complaint alleges causes of action for: (1) Violation of Cal. Gov. Code § 12945.2 (California Family Rights Act); (2) Violation of California Civil Code, §52.1(Banes Act); (3) Aiding, Abetting, Inciting, Compelling, or Coercing Acts Forbidden by Cal. Govt. Code §12940(i) (FEHA); (4) Wrongful termination; (5) Unfair and Unlawful Business Practices; (6) California Worker Adjustment and Retraining Notification Act (WARN Act); (7) Breach of Contract; (8) Intentional Infliction of Emotional Distress; (9) Negligent Infliction of Emotional Distress; (10) Negligence; (11) Violation of Cal. Gov’t. Code §12940(i) (California Fair Employment and Housing Act) (FEHA); (12) Disability Discrimination by Association in Violation of FEHA[Cal. Gov't Code § 12926(o)]; and (13) Failure to Prevent Discrimination in Violation of FEHA [Cal. Gov't Code § 12940(k)].

Defendant, Brightview Landscapes LLC (“Defendant”) now seeks to enforce an arbitration clause Plaintiff allegedly signed in connection with his re-employment with the Defendant’s company.

B. Procedural

On October 7, 2024, Defendant file a Motion to Compel Arbitration. On October 16, 2024, Plaintiff filed an opposition. On November 1, 2024, Defendant filed a reply brief.

II. EVIDENTIARY OBJECTIONS:

Plaintiff’s Objection to the Supplemental Declaration of Jeff Robinson

Overrule: n/a

Sustain: 1-4

The supplemental declaration of Jeff Robinson was filed with the reply brief on November 1, 2024, and Plaintiff has not had the opportunity to respond to it in opposition. It is improper to bring new evidence on reply. As such, the Court sustains Plaintiff’s objections. Alternatively, the Court would consider continuing the hearing until its next available date, December 31, 2024, and affording Plaintiff the opportunity to file a sur-reply but would then also consider Mr. Robinson’s supplemental declaration too.

Defendant’s Objections to Plaintiff’s Declaration of Jonathan D. Winters

Overrule: 4, 5, 7.

Sustain: n/a.

Defendant’s Objections to Plaintiff’s Declaration of Francisco Lopez

Overrule: 2, 9, 10.

Sustain: 8.

III. ANALYSIS

A. Legal Standard

The Federal Arbitration Act (“FAA”) states that “[a] written provision in any . . . 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.” (9 U.S.C. § 2.) California law incorporates many of the basic policy objectives contained in the Federal Arbitration Act, including a presumption in favor of arbitrability. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 971-72.)

California law states that “[o]n 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….” (Code Civ. Proc, § 1281.2.) “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.)

Pursuant to Code of Civil Procedure §1281.2, generally, on a petition to compel arbitration, the court must grant the petition unless it finds either (1) no written agreement to arbitrate exists; (2)¿the right to compel arbitration has been waived; (3) grounds exist for revocation of the agreement; or (4) litigation is pending that may render the arbitration unnecessary or create conflicting¿rulings on common issues.

When seeking to compel arbitration, the initial burden lies with the moving party to demonstrate the existence of a valid arbitration agreement by preponderance of evidence. (Ruiz v. Moss Bros. Auto Group (2014) 232 Cal.App.4th 836, 841-42; Gamboa v. Northeast Community Clinic (2021), 72 Cal.App.5th 158, 164-65.) It is sufficient for the moving party to produce a copy of the arbitration agreement or set forth the agreement’s provisions. (Gamboa, 72 Cal.App.5th at 165.) The burden then shifts to the opposing party to prove by a preponderance of evidence any defense to enforcement of the contract or the arbitration clause. (Ruiz, 232 Cal.App.4th at 842; Gamboa, 72 Cal.App.5th at 165.) Subsequently, the moving party must establish with the preponderance of admissible evidence a valid arbitration agreement between the parties. (Ibid.) The trial court then weighs all the evidence submitted and uses its discretion to make a final determination. (Ibid.) “California law, ‘like [federal law], reflects a strong policy favoring arbitration agreements and requires close judicial scrutiny of waiver claims.’” (Wagner Const. Co. v. Pacific Mechanical Corp. (2007) 41 Cal.4th 19, 31.)

If the court orders arbitration, then the court shall stay the action until arbitration is completed. (See Code Civ. Proc., § 1281.4.)

B. Discussion

Here, the parties do not disagree that Plaintiff signed an agreement with Defendant to arbitrate issues between the parties. However, Plaintiff does argue that the arbitration agreement is invalid because it is both procedurally and substantively unconscionable.

Defendant asserts in its moving papers that on June 11, 2019, Plaintiff executed a standalone arbitration agreement as part of his rehiring and onboarding process. (Robinson Decl., ¶ 5, Exhibit A.) Defendant contends that the Arbitration Agreement covers “any and all existing or future dispute or claims between Employee and Employer, that arise out of or relate to Employee’s recruitment, employment, or separation from employment with Employer…” (Robinson Decl., ¶ 5, Exhibit A.) The Arbitration Agreement specifically states the following:

claims involving any current or former officer, director, shareholder, agent or employee of Employer, whether the disputes or claims arise under common law, or in tort, contract, or pursuant to a statute, regulation, or ordinance now in existence or which may in the future be enacted or recognized …

claims for fraud, promissory estoppel, fraudulent inducement of contract or breach of contract or contractual obligation, whether such alleged contract or obligation be oral, written, or express or implied by fact or law;

claims for wrongful termination of employment, violation of public policy and constructive discharge, infliction of emotional distress, misrepresentation, interference with contract or prospective economic advantage, defamation, unfair business practices, and any other tort or tort-like causes of action relating to or arising from the employment relationship or the formation or termination thereof;

claims for discrimination, harassment or retaliation, whether on the basis of age, sex, race, national origin, religion, disability or any other unlawful basis, under any and all federal, state, or municipal statutes, regulations, ordinances or common law, including but not limited to Title VII of the Civil Rights Act of 1964, the Civil Rights Acts of 1866 and 1991, the Age Discrimination in Employment Act of 1967, the Older Workers Benefit Protection Act of 1990, the Rehabilitation Act of 1973, the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, and including claims under the Fair Labor Standards Act of 1938, the Equal Pay Act of 1963, Section 1981 of the Civil Rights Act, and the Worker Adjustment and Retraining Notification Act.

claims for non-payment or incorrect payment of wages, commissions, bonuses, severance, and employee fringe benefits, stock options and the like, whether such claims be pursuant to alleged express or implied contract or obligation, equity, and any federal, state, or municipal laws concerning wages, compensation or employee benefits, claims of failure to pay wages for all hours worked, failure to pay overtime, failure to pay wages due on termination, failure to provide accurate, itemized wage statements, entitlement to waiting time penalties and/or any other claims involving employee compensation issues.

(Robinson Decl., ¶ 5, Exhibit A.)

Here, this Court acknowledges that based on the face of the arbitration agreement, and in the complaint, Plaintiff’s causes of action against Defendant involve Defendant’s alleged wrongful termination of Plaintiff with the addition of other sections covered by the Arbitration Agreement. As such, the Court finds that preliminarily, the causes of action brought by Plaintiffs would be covered by the arbitration agreement.

Valid Arbitration Agreement

Plaintiffs argue in their opposition, that the Arbitration Agreement is not valid because it is both procedurally and substantively unconscionable. More specifically, Plaintiff argues that the agreement was presented to him, a Spanish-speaking individual with limited English proficiency, without explanation or translation. He also argues that he had no meaningful opportunity to negotiate its terms and was not even provided a copy. Moreover, Plaintiff states the agreement unfairly restricts Plaintiff’s rights and remedies.

This Court notes that under the FAA, only generally applicable contract defenses such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements without contravening the FAA. (Aviation Data, Inc. v. American Express Travel Related Services Co., Inc. (2007) 152 Cal.App.4th 1522.)

Unconscionability

Plaintiff argues in his opposition that the agreement is both procedurally and substantively unconscionable. Unconscionability is a valid defense to a petition to compel arbitration. (Sonic-Calabasas A, Inc. v. Moreno (2013) 57 Cal.4th 1109, 1143.) State law governs the “unconscionability” defense. (Doctor’s Assocs., Inc. v. Casarotto (1996) 517 US 681, 687.) The core concern of the unconscionability doctrine is the “absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party.” (Sonic-Calabasas, supra, 57 Cal.4th at 1145.) The unconscionability doctrine ensures that contracts—particularly contracts of adhesion—do not impose terms that have been variously described as overly harsh, unduly oppressive, so one-sided as to shock the conscience, or unfairly one-sided. (Id.)

“The procedural element of unconscionability focuses on whether the contract is one of adhesion. (Armendariz, supra, 24 Cal.4th at p. 113; Mercuro v. Superior Court, supra, 96 Cal.App.4th at p. 174.) Procedural unconscionability focuses on whether there is “oppression” arising from an inequality of bargaining power or “surprise” arising from buried terms in a complex printed form. (Armendariz, supra, 24 Cal.4th at p. 114; Mercuro v. Superior Court, supra, 96 Cal.App.4th at p. 174.) The substantive element addresses the existence of overly harsh or one-sided terms. (Little v. Auto Stiegler, Inc. (2003) 29 Cal.4th 1064, 1071 [130 Cal.Rptr.2d 892, 63 P.3d 979]; Armendariz, supra, 24 Cal.4th at p. 114.) An agreement to arbitrate is unenforceable only if both the procedural and substantive elements are satisfied. (Armendariz, supra, 24 Cal.4th at p. 113; Mercuro v. Superior Court, supra, 96 Cal.App.4th at p. 174.) However, Armendariz held, “[T]he more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Armendariz, at p. 114; see also Kinney v. United HealthCare Services, Inc., supra, 70 Cal.App.4th at p. 1329.).” McManus v. CIBC World Markets Corp. (2003) 109 Cal.App.4th 76, 87.)

Procedural Unconscionability

Plaintiff first argues that the Arbitration Agreement is procedurally unconscionable on the grounds that: (1) it was presented to Plaintiff only in English, without any Spanish translation or explanation; (2) there was a lack of opportunity to negotiate; and (3) Defendant’s failed to provide Plaintiff with a copy. First, although Plaintiff is correct in his assertion that some California courts have found language barrier to be unconscionable, the cases referenced also included other bad acts on behalf of the employer. This Court notes that “‘[o]rdinarily, one who accepts or signs an instrument, which on its face is a contract, is deemed to assent to all its terms, and cannot escape liability on the ground that he has not read it. If he cannot read, he should have it read or explained to him.” (1 Witkin, Summary of Cal. Law (9th ed. 1987), § 120, p. 145.) This is not only the California but the general rule. (3 Corbin, Contracts (1960) § 607, pp. 668–669 [“One who signs an instrument when for some reason, such as illiteracy or blindness, he can not read it, will be bound by its terms in case the other party acts in good faith without trick or misrepresentation. The signer should have had the instrument read to him.’”] as cited in Randas v. YMCA of Metropolitan Los Angeles (1993) 17 Cal.App.4th 158, 163.) As such, unless Plaintiff shows that Defendant acted in bath faith or with trick or misrepresentation, he is bound by the document he signed, even if he is not proficient in English.

The Court is aware of the California Translation Act. Under that law, a contracting party may rescind a contract or even perhaps an arbitration agreement under Civil Code § 1632(b)(2), if the Court were to finds that the Act applies to the subject plaintiff-defendant relationship as “[a] loan or extension of credit secured other than by real property, or unsecured, for use primarily for personal, family, or household purposes.” The Court has found no precedent where an employment contract has been accepted to be protected under Civil Code § 1632(b)(2). The thrust of the contract here, its gravamen and primary terms, are not for a loan or extension of credit; rather it is one for employment.

Here, Plaintiff has not alleged sufficient facts to show that Defendant acted in bad faith when presenting him with the Arbitration Agreement. First, Plaintiff does not allege that he asked that the agreement be given to him in Spanish. Instead, Francisco Lopez asserts that he does not recall signing the arbitration agreement, that he was not presented with an arbitration agreement in Spanish, and that he was never offered a Spanish translation. (Declaration of Francisco Lopez (“Lopez Decl.”), ¶¶ 4-6.) Further, Jeff Robinson, Defendant’s Senior Vice President of HR, included the signed arbitration agreement (with Plaintiff’s alleged signature), and noted that employees are afforded an unlimited amount of time to review the Arbitration Agreement, review it as many times as they want, and can ask any questions to Defendant’s HR professional that they may have before signing. (Robinson Decl., ¶¶ 5-6, Exhibit A.) Robinson further noted that there is also a Brightview employee available to explain any information regarding the onboarding process and documents to employees in Spanish. (Robinson Decl., ¶ 6.)

Plaintiff does not allege any bad faith representation on behalf of Defendant, and Plaintiffs may not – now – seek to invalidate the arbitration agreement because Plaintiff signed an agreement he did not understand, and made no effort to understand prior to signing.

Next, Plaintiff argues that the Arbitration Agreement is procedurally unconscionable because it was presented on a ‘take it or leave it’ contract that gave Plaintiff no meaningful opportunity but to sign the agreement to be rehired by Defendant, indicating a lack of opportunity to negotiate. This Court notes that when there is no other indication of oppression other than the adhesive aspect of an agreement, the degree of procedural unconscionability is low. (Serpa v. California Surety Investigations, Inc. (2013) 215 Cal.App.4th 695, 704.)

Lastly, Plaintiff argues that the Arbitration Agreement is procedurally unconscionable because Plaintiff was not provided a copy of the agreement he allegedly signed, violating California Labor Code section 432. In its reply, Defendant argues that Plaintiff was provided with a copy after he signed. However, Defendant does not back up this argument with admissible evidence of such. Despite this, and even considering the alleged lack of providing a copy, the Court finds that the level of procedural unconscionability is moderately low, requiring it to consider the second level of claimed unconscionability.

Substantive Unconscionability

Next, Plaintiff argues that the Arbitration Agreement is substantively unconscionable for three reasons: (1) there is a PAGA Waiver; (2) Unilateral Modification; and (3) Limited Discovery.

First, the Court notes, as does Defendant in its reply brief, that per Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. 639, 660-61(“Viking River”) has overruled and does not apply to the portion of Iskanian upon which Plaintiff relies. Further, as noted by Defendant, if this the representative action waiver were unconscionable, the Court may sever this provision. Second, the Court’s reading of the Arbitration Agreement does not have a unilateral modification.

Lastly, as to limited discovery, the limits affect both parties equally. If the plaintiff is precluded from taking depositions, so is the defense. If interrogatories are restricted in arbitration, that restriction applies equally to both sides. Arbitrators often approve stipulations for discovery that are balanced for both sides. A discovery limitation, which is true of all arbitrations, cannot be a reason for this Court to find such agreements unconscionable – otherwise arbitration would almost never be an option. Thus, this Court finds that the level of substantive unconscionability is not sufficient to deny this motion on those grounds.

Armendariz Requirements

The Court disagrees with Plaintiff’s argument that the Arbitration Agreement violates Armendariz requirements. The requirements have each been met by the Arbitration Agreement itself.

IV. CONCLUSION

For the foregoing reasons, this Court’s tentative ruling is to GRANT Defendant’s Motion to Compel Arbitration.

Defendant is ordered to give notice.