Judge: Serena R. Murillo, Case: 22STCV36640, Date: 2023-05-10 Tentative Ruling
Case Number: 22STCV36640 Hearing Date: May 10, 2023 Dept: 31
TENTATIVE
Defendant’s Motion to Compel Arbitration and Stay
Proceedings is GRANTED.
Legal Standard
Parties may be compelled to arbitrate a dispute upon the
court finding that: (1) there was a valid agreement to arbitrate between the
parties; and (2) said agreement covers the controversy or controversies in the
parties’ dispute.¿(Code Civ. Proc., § 1281.2; Omar v. Ralphs Grocery Co.
(2004)¿118 Cal.App.4th 955, 961.)¿
¿¿
A party petitioning to compel arbitration has the burden of
establishing the existence of a valid agreement to arbitrate and the party
opposing the petition has the burden of proving, by a preponderance of the
evidence, any fact necessary to its defense. (Banner Entertainment, Inc. v.
Superior Court¿(1998) 62 Cal.App.4th 348, 356-57.)¿¿
¿
“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.” (Code Civ. Proc., § 1281.4.)¿
Discussion
Existence
of a Valid Agreement
Defendants
iHeartmedia + Entertainment, Inc. (“iHeart”); Premiere Networks, Inc.
(“Premiere”); and Adrian Rivas (“Rivas”) move to compel Plaintiff to arbitrate
her claims. Defendants assert that when Plaintiff started her employment in
2000 she signed a binding arbitration agreement (“Agreement”) that requires
Plaintiff to submit all her claims to arbitration. (Moreno Decl. ¶¶ 2, 3; Ex. A
[Agreement].)
When
Plaintiff signed the Agreement, Defendant iHeart was formerly known as Clear
Channel Broadcasting, Inc, but changed its name in 2014. (Bick Decl. ¶¶ 2, 3.)
Defendant Premiere is an affiliate of iHeart and also changed its name from
“Premiere Radio Networks, In.” to “Premiere Networks, Inc.” (Id. ¶¶ 5,
6, Ex. A.) Defendant Rivas is employed by Premiere and is Plaintiff’s supervisor.
(Rivas Dec. ¶ 2.)
As
part of her new hire paperwork, Plaintiff signed the Agreement on February 25,
2000. (Moreno Decl. ¶ 3, Ex. A.) Plaintiff does not dispute that she signed the
Agreement when she was hired. (Beyer Decl. ¶ 2.)
The
Agreement is titled “ARBITRATION AGREEMENT” and provides that if a
dispute arises the parties will use arbitration and “[t]he Employee understand
that this Agreement waives his or her right to a jury trial and waives the
right to seek remedies in court.” (Moreno Decl. Ex. A at 6.) The agreement
further provides “that all disputes as defined in this Agreement will be
submitted to final and binding determination by an impartial arbitrator under
the Employment Dispute Resolution Rules of the American Arbitration
Association.” (Id. at 1.)
Defendants
assert the Agreement is governed by the Federal Arbitration Act (“FAA”). The
Agreement itself does not state that the FAA applies, but Defendants assert the
FAA governs the Agreement because Defendants conduct business across the United
States. (Bick Decl. ¶¶ 2-5.) Defendant iHeart operates over 860 radio stations
in approximately 160 markets across the U.S. (Id. ¶ 5.) Its affiliate,
Defendant Premiere, syndicates more than 100 radio programs and services to
thousands of radio affiliates. (Id. ¶ 4.) Plaintiff does not dispute
that the FAA applies to the Agreement.
The
Agreement also contains a delegation clause that requires the arbitrator, and
not the Court, to decide issues of enforceability. The delegation provision
appears under “Covered Claims” and states:
“This
Agreement covers the following potential claims:
1.
Any dispute regarding the
arbitrability of any such claim;
2.
Any dispute regarding this
Agreement, including but not limited to its enforceability, scope or terms;”
(Moreno
Decl. Ex. A at 2.)
Plaintiff’s
Opposition
Plaintiff
does not deny that she signed the Agreement but states that she never worked
for an entity named either Clear Channel or Eller in its name. (Beyer Decl. ¶
2.) Plaintiff asserts that she was hired to work for Premiere Radio, a separate
corporate entity not mentioned in the Agreement. However, fails to provide
evidence that Premiere Radio is a separate corporate entity.
Although
the term “Company” is not specifically defined, the Agreement states:
“The
Arbitration Agreement becomes effective immediately upon hire or six weeks
following the date of close if employee gains Clear Channel/Eller employment by
means of a Company acquisition.”
(Moreno
Decl. Ex. A at 1.) On the signature page the “Station/Branch” is identified as
“Premiere Radio.” (Id. at 7.) This evidences that Defendant Premiere was
Plaintiff’s employer unless Plaintiff can provide evidence that the
Station/Branch was owned by a different entity. Thus, under the Agency
Exception, Defendants can enforce the Agreement. (See Thomas v. Westlake¿(2012)
204 Cal.App.4th 605, 614 [“One such exception provides that when a plaintiff
alleges a defendant acted as an agent of a party to an arbitration agreement,
the defendant may enforce the agreement even though the defendant is not a party
thereto.”].)
Furthermore,
the Agreement refers to “Clear Channel/Eller” and indicates that the parties
contemplated that any dispute with Clear Channel/Eller would be arbitrated. The
“New Hire” Packet also included a checklist with the name “Clear Channel/Eller
Media” in its header and a checkmark for “Original Arbitration Agreement.”
(Moreno Decl. ¶ 4, Ex. B.) Lastly, Plaintiff’s personnel file was maintained by
iHeart. (Id. ¶¶ 2,3.) This is sufficient to show that iHeart is a party
to the Agreement and has standing to enforce it.
Therefore,
the Court finds that a valid Agreement exists between the parties that compels
both parties to arbitration their claims.
The Delegation Clause
Plaintiff challenges the
delegation clause on the basis that “[i]t does not specifically state that
enforceability is an issue exclusively for the arbitrator.” (Opp. at 13:1-2.)
However, the Agreement does state that “[a]ny dispute regarding this Agreement,
including but not limited to its enforceability, scope or terms;” is covered by
the Agreement, meaning the issue is decided in arbitration by an arbitrator
rather than the Court.
“The delegation provision is an agreement
to arbitrate threshold issues concerning the arbitration agreement. We have recognized
that parties can agree to arbitrate ‘gateway’ questions of ‘arbitrability,’
such as whether the parties have agreed to arbitrate or whether their agreement
covers a particular controversy.” (Rent-A-Center, West, Inc. v.
Jackson (2010) 561 U.S. 63, 68–69.) Plaintiff fails to show that any
disputes regarding the enforceability or scope of the Agreement were not
intended to be decided in arbitration.
“There are two prerequisites for a
delegation clause to be effective. First, the language of the clause must be
clear and unmistakable. [Citation.] Second, the delegation must not be
revocable under state contract defenses such as fraud, duress, or
unconscionability.” (Tiri v. Lucky Chances, Inc. (2014)
226 Cal.App.4th 231, 242.) The Court finds that the Agreement clearly states
that issues pertaining to enforceability and scope of terms are covered by the
Agreement and must be decided in Arbitration and not by the Court. (See Moreno
Decl. Ex. A at 6.)
Furthermore, Plaintiff’s other challenges
to the Agreement, including its limitations on discovery and claims of
unconscionability, must be decided in arbitration. The United States Supreme Court explained in Rent-A-Center, that any claim of unconscionability must
be specific to the delegation clause. (Rent–A–Center, supra, 561 U.S. at 73.) The plaintiff in Rent-A-Car
failed to direct his challenge of unconscionability specifically to the
delegation clause, thus the delegation clause was upheld and the issue of
unconscionability was left to the arbitrator to decide. (Id. 72-73
[“Accordingly, unless [plaintiff] challenged the delegation provision
specifically, we must treat it as valid under § 2 [of the FAA], and must
enforce it under §§ 3 and 4 [of the FAA], leaving any challenge to the validity
of the Agreement as a whole for the arbitrator.”].)
Like the plaintiff in Rent-A-Center,
Plaintiff in this instant action has failed to challenge the Delegation Clause
itself as being unconscionable and instead has challenged the Agreement as a
whole. Therefore,
whether the Agreement is unconscionable is a determination that must be made in
arbitration, per the terms of the Agreement.
Defendant’s
Motion is GRANTED.
Conclusion
Defendant’s Motion to Compel Arbitration and Stay
Proceedings is GRANTED.
The Case Management Conference scheduled for June 20, 2023 is continued to November 16, 2023 at 9:00 a.m.
The Court sets a Post Arbitration Status Conference for the same date and time.
The case is STAYED.
Moving party is ordered to give notice.