Judge: Teresa A. Beaudet, Case: 22STCV29091, Date: 2023-03-21 Tentative Ruling
Case Number: 22STCV29091 Hearing Date: March 21, 2023 Dept: 50
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DAVID HICKMAN, Plaintiff, vs. MARTIN LUTHER KING, JR.-LOS
ANGELES (MLK-LA) HEALTHCARE CORPORATION,
et al. Defendants. |
Case No.: |
22STCV29091 |
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Hearing Date: |
March 21, 2023 |
|
|
Hearing
Time: 10:00 a.m. [TENTATIVE] ORDER
RE: DEFENDANT
SNAPMEDTECH, INC.’S MOTION TO COMPEL ARBITRATION, AND DISMISS OR STAY
PROCEEDINGS; DEFENDANT MARTIN
LUTHER KING, JR. - LOS ANGELES (MLK-LA) HEALTHCARE CORPORATION’S JOINDER IN
MOTION TO COMPEL ARBITRATION AND STAY PROCEEDINGS BY DEFENDANT SNAPMEDTECH,
INC. |
||
Background
Plaintiff David Hickman
(“Plaintiff”) filed this employment action on September 7, 2022 against
Defendants Martin Luther King, Jr. – Los Angeles (MLK-LA) Healthcare
Corporation and SnapMedTech, Inc. The Complaint asserts causes of action for
(1) harassment based on
race – hostile work environment, (2)
discrimination based on race, (3) retaliation in violation of FEHA, (4) failure
to prevent harassment, discrimination, and retaliation, (5) whistleblower
retaliation in violation of Labor Code section 1102.5,
(6) whistleblower retaliation in violation of Health
& Safety Code section 1278.5,
(7) wrongful termination in violation of public policy, (8) intentional
interference with contractual relations, and (9) intentional infliction of
emotional distress.[1]
SnapMedTech, Inc. dba
SnapNurse (“SnapMedTech”) now moves for an order compelling Plaintiff to submit
his claims to binding arbitration and to stay or dismiss the proceedings
pending the arbitration of Plaintiff’s claims. Martin Luther King, Jr. – Los
Angeles Healthcare Corporation (“MLK-LA”) moves to join SnapMedTech’s motion to
compel arbitration.[2] Plaintiff opposes.
Legal Standard
In a motion to compel
arbitration, the moving party must prove by a preponderance of evidence the
existence of the arbitration agreement and that the dispute is covered by the
agreement. The burden then shifts to the resisting party to prove by a
preponderance of evidence a ground for denial (e.g., fraud, unconscionability, etc.). ((Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413-414.)
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. ((Code
Civ. Proc., § 1281.2); (see Condee v. Longwood Management Corp. (2001) 88 Cal.App.4th 215, 218-219.)
“California has a strong
public policy in favor of arbitration and any doubts regarding the
arbitrability of a dispute are resolved in favor of arbitration.” ((Coast Plaza Doctors Hospital v. Blue Cross of California
(2000) 83 Cal.App.4th 677, 686.) “This strong policy has resulted in the general rule that
arbitration should be upheld unless it can be said with assurance that an
arbitration clause is not susceptible to an interpretation covering the
asserted dispute.” ((Ibid. [internal
quotations omitted].) This is in accord with the
liberal federal policy favoring arbitration agreements under the Federal
Arbitration Act (“FAA”), which governs all agreements to arbitrate in contracts
“involving interstate commerce.” (9 U.S.C. section 2,
et seq.; (Higgins
v. Superior Court (2006) 140
Cal.App.4th 1238, 1247.)
Discussion
A. Existence of Arbitration Agreement
SnapMedTech notes that
Plaintiff alleges that on or about February 22, 2021, he was hired as a
registered nurse by SnapMedTech, a staffing agency for healthcare
professionals. (Compl., ¶ 8.) On or about January 26, 2022, Plaintiff was
assigned to the Emergency Department at MLK-LA. (Compl., ¶ 8.) Plaintiff’s
employment contract at the hospital was terminated by Defendants on or about
June 24, 2022. (Compl., ¶ 9.)
SnapMedTech indicates
that Plaintiff electronically signed an Arbitration Agreement on or about May
5, 2021. (Sims Decl., ¶ 5, Ex. A.) SnapMedTech states that “[w]ith a
predominantly remote workforce, execution of documents during the onboarding
process are [sic] done electronically and remotely by the new hire. Employees
have private access to the on-boarding system through the use of a password
that they create at the time of hire/onboarding. The documents are executed via
signature either through utilizing a finger on a cell phone to sign the
document or alternatively using a mouse to sign the document on a computer. . .
Only the employee has the ability to access the account, through the use of the
established password, and execute documents. SnapNurse has no access or
knowledge of the passwords used by employees.” (Sims Decl., ¶ 4.)
Plaintiff’s subject Arbitration
Agreement provides:
“Employee, on behalf of himself or
herself and all heirs, successors, and assign,
agrees to resolve any and all disputes
or claims related in any manner whatsoever to his or her employment with SnapNurse,
including but not limited to, any claims against SnapNurse, its officers,
shareholders, employees, agents, affiliates, subsidiaries, parents, or
successors (together, the “Company”), by binding arbitration before a neutral
third party in accordance with the applicable rules of the American Arbitration
Association (“AAA”). Disputes or claims related to employment include causes of
action, allegations, claims or charges based upon federal or state statutes or
laws, including, but not limited to, any federal or state civil rights or human
rights law, federal or state wage and hour law, federal or state family,
personal, or medical leave law, federal or state laws relating to benefits,
tort or contract laws, or any other federal or state law affecting employment
in any manner whatsoever. Employee agrees to pursue any disputes or claims on
an individual basis in arbitration. Specifically, Employee agrees not to
pursue, or allow anyone to pursue on his or her behalf, any claims on a class
or collective basis in arbitration or otherwise. Judgment on the award rendered
by the arbitrator may be entered in any court having jurisdiction thereof. The
arbitrator shall be agreed upon by both sides unless unable to agree, in which
case the arbitrator shall be selected in accordance with the normal procedures
of the AAA. The parties agree that the Federal Arbitration Act governs the
enforceability of this agreement to arbitrate.” (Sims Decl., ¶ 5, Ex. A.)
Plaintiff does not
dispute that he signed the Arbitration Agreement, or that it covers the claims
Plaintiff asserted against SnapMedTech in this matter.
Based on the foregoing, the Court finds that SnapMedTech has demonstrated the existence of an arbitration agreement
and that it covers the claims asserted against SnapMedTech by Plaintiff in this action. Thus, the burden now shifts to Plaintiff to prove a ground for
denial.
B. Unconscionability
An arbitration agreement
must be both procedurally and substantively unconscionable to be unenforceable.
((Armendariz v. Foundation Health Psychcare
Services, Inc. (2000) 24 Cal.4th
83, 114); (Mission
Viejo Emergency Medical Associates v. Beta Healthcare Group (2011) 197 Cal.App.4th 1146, 1159
[unnecessary to decide whether insurance policy was adhesion contract and procedurally
unconscionable because it was not substantively unconscionable].)
Plaintiff argues that
the subject Arbitration Agreement is both procedurally and substantively
unconscionable.
i.
Procedural Unconscionability
Procedural
unconscionability concerns the manner in which the contract was negotiated and
the parties’ circumstances at that time. It focuses on the factors of
oppression or surprise. ((Kinney v. United
Healthcare Servs. (1999) 70
Cal.App.4th 1322, 1329.) “Oppression generally takes the form
of a contract of adhesion, which, imposed and drafted by the party of superior
bargaining strength, relegates to the subscribing party only the opportunity to
adhere to the contract or reject it. In the case of arbitration agreements in
the employment context, the economic pressure exerted by employers on all but
the most sought-after employees may be particularly acute, for the arbitration
agreement stands between the employee and necessary employment, and few
employees are in a position to refuse a job because of an arbitration
requirement.” ((Carmona v. Lincoln Millennium
Car Wash, Inc. (2014) 226
Cal.App.4th 74, 84 [quotations and citations omitted].) “Surprise
involves the extent to which the supposedly agreed-upon terms of the bargain
are hidden in a prolix printed form drafted by the party seeking to enforce the
disputed terms. ((A & M Produce Co. v. FMC Corp. (1982) 135 Cal.App.3d 473, 484 [internal
quotations omitted].)
Here, Plaintiff asserts that there was procedural
unconscionability because the Arbitration Agreement was presented on a take it
or leave it basis. Plaintiff states that he was required to electronically sign
onboarding documents, including the Arbitration Agreement, to be employed by
Defendant. (Hickman Decl., ¶ 4.) Plaintiff also states that he was not given an
opportunity to negotiate or reject the Arbitration Agreement, and that there
was no opt-out provision. (Hickman Decl., ¶ 6.) SnapMedTech counters that Plaintiff does not indicate in his
declaration that he requested or attempted to negotiate the terms of the
Arbitration Agreement. While it is true that
“the existence of contract of adhesion supports a finding of procedural
conscionability,” the court must still weigh the level of procedural
unconscionability against any substantive unconscionability to determine
whether the agreement can be enforced. ((Baxter
v. Genworth North America Corp. (2017)
16 Cal.App.5th 713, 723.)
Plaintiff also asserts that the Arbitration
Agreement was “oppressively and deceptively presented.” (Opp’n at p. 8:1.)
Plaintiff states that the Arbitration Agreement was presented with other
company policies within the onboarding documents. (Hickman Decl., ¶ 5.) Plaintiff
states that defendant did not explain to Plaintiff the content or the
significance of the Arbitration Agreement. (Hickman Decl., ¶ 5.) Plaintiff also
states that he was never informed and did not understand that he was giving up
his right to a jury trial. (Hickman Decl., ¶ 5.) SnapMedTech counters that in Brookwood
v. Bank of America (1996) 45
Cal.App.4th 1667, 1674,
the Court of Appeal found that “[r]easonable diligence requires the reading of a contract
before signing it. A party cannot use his own lack of diligence to avoid an
arbitration agreement.” In
addition, the Brookwood Court found that “plaintiff
was bound by the provisions of the [arbitration] agreement regardless of
whether [she] read it or [was] aware of the arbitration clause when [she]
signed the document.” ((Ibid.
[internal quotations omitted].)
SnapMedTech also 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.” ((Randas v. YMCA of Metropolitan Los Angeles (1993) 17 Cal.App.4th 158, 163.)
Plaintiff also asserts that the language of
the Arbitration Agreement supports a finding of surprise. In support of this
assertion, Plaintiff cites to OTO, L.L.C. v.
Kho (2019) 8 Cal.5th 111, 128, where the California Supreme Court found
that “[t]he facts also support the trial court’s finding of surprise.
The agreement is a paragon of prolixity, only slightly more than a page long
but written in an extremely small font. The single dense paragraph covering
arbitration requires 51 lines. As the Court of Appeal noted, the text is ‘visually
impenetrable’ and ‘challenge[s] the limits of legibility.’” Plaintiff argues that “[t]he
agreement appears to be in small font, requiring the user to ‘zoom in,’ to
read, especially on a mobile device.” (Opp’n at p. 9:8-9.) However, the Court
does not find that Plaintiff has shown that the Arbitration Agreement was
written in extremely small font, as was the case in OTO. Plaintiff also
asserts that the “sentences are complex, filled with statutory legal jargon,”
(Opp’n at p. 9:6) but does not cite to legal authority demonstrating that this
constitutes “surprise.”
Plaintiff also states that he was not provided with the applicable
arbitration rules. (Hickman Decl., ¶ 6.) Plaintiff notes that “[f]ailure to provide the applicable
arbitration rules is another factor that supports procedural unconscionability.” ((Carmona v. Lincoln Millennium Car Wash, Inc., supra, 226 Cal.App.4th at p. 84.) Plaintiff also cites to Trivedi v. Curexo Technology Corp. (2010) 189 Cal.App.4th 387 in support of this point.
SnapMedTech asserts that
the failure to attach the AAA rules does not render the Arbitration Agreement
unconscionable. SnapMedTech cites to Baltazar
v. Forever 21, Inc. (2016) 62
Cal.4th 1237, 1246, where
“Baltazar argue[d] that a somewhat greater
degree of procedural unconscionability is present here—warranting closer
scrutiny of the substantive fairness of the agreement’s terms—because Forever 21 did not provide Baltazar with a copy of the AAA’s rules for arbitration of
employment disputes, which, by the terms of the arbitration agreement, govern
any arbitration between the parties.” The Baltazar Court noted
that “Baltazar relies on Trivedi, which notes
that [n]umerous cases have held that the failure to provide a copy of the
arbitration rules to which the employee would be bound supported a finding of
procedural unconscionability. But in Trivedi itself and in
each of the Court of Appeal decisions cited therein, the plaintiff’s
unconscionability claim depended in some manner on the arbitration rules in
question. These cases thus stand for the proposition that courts
will more closely scrutinize the substantive unconscionability of terms that
were artfully hidden by the simple expedient of incorporating them by
reference rather than including them in or attaching them to the arbitration
agreement. Baltazar’s argument accordingly might have force if her
unconscionability challenge concerned some element of the AAA rules of which
she had been unaware when she signed the arbitration agreement. But her
challenge to the enforcement of the agreement has nothing to do with the AAA
rules; her challenge concerns only matters that were clearly delineated in the
agreement she signed. Forever 21’s failure to attach the AAA
rules therefore does not affect our consideration of Baltazar’s claims of
substantive unconscionability.” ((Id. at p.
1246 [internal quotations and citations omitted].) Here, Plaintiff
does not argue that he had been unaware of some element of the AAA rules that
were hidden when he signed the Arbitration Agreement.
Based on the foregoing, the Court finds that there is a low level of
procedural unconscionability.
ii.
Substantive Unconscionability
“Substantive
unconscionability pertains to the fairness of an agreement’s actual terms and
to assessments of whether they are overly harsh or one-sided. A contract term
is not substantively unconscionable when it merely gives one side a greater
benefit; rather, the term must be so one-sided as to ‘shock the conscience.’” ((Carmona
v. Lincoln Millennium Car Wash, Inc.,
supra, 226 Cal.App.4th at p. 85 [internal quotations and citations
omitted].) “[T]he paramount consideration in
assessing [substantive] conscionability is mutuality.” ((Ibid. [brackets in original].)
Plaintiff
notes that the Arbitration Agreement does not contain any provision concerning
costs, and asserts that this renders the agreement substantively
unconscionable. Plaintiff cites
to a nonbinding federal case in support of this assertion. ((Chavarria v. Ralphs Grocery Co. (9th Cir. 2013) 733 F.3d 916.) In addition, SnapMedTech notes that in Armendariz v. Foundation Health Psychcare Services,
Inc., supra, 24 Cal.4th at
page 113, the California
Supreme Court held that “a
mandatory employment
arbitration agreement that contains within its scope the arbitration of FEHA
claims impliedly obliges the employer to pay all types of costs that are unique
to arbitration. Accordingly, we interpret the arbitration agreement in the present
case as providing, consistent with the above, that the employer must bear
the arbitration forum costs. The absence of specific provisions on
arbitration costs would therefore not be grounds for denying the enforcement of
an arbitration agreement.”
(Emphasis added.) In addition, SnapMedTech states that it “agrees to
bear all costs unique to arbitration for the above-captioned matter.” (Sims
Decl., ¶ 8.)
Plaintiff
also asserts that the AAA’s limited discovery rules are unconscionable. The
Arbitration Agreement provides, inter alia, that the arbitration shall
be “before a neutral third
party in accordance with the applicable rules of the American Arbitration
Association (‘AAA’).” (Sims Decl., ¶ 5, Ex. A.) Plaintiff cites to Dougherty v. Roseville Heritage Partners (2020) 47 Cal.App.5th 93, 106, where the Court of Appeal found that “[e]ven though the law requires plaintiffs to
establish their elder abuse claims under the clear and convincing evidence
standard, the governing AAA commercial rules only permit depositions in
exceptional cases at the discretion of the arbitrator, upon a showing of good
cause, and consistent with the expedited nature of arbitration. It is unclear
whether an arbitrator would consider plaintiffs’ case to be exceptional with
sufficient good cause to warrant depositions. In addition, although the
arbitrator has authority to require document discovery, there is no provision
for interrogatories or requests for admissions. These discovery restrictions
run the risk of frustrating plaintiffs’ statutory rights under the Act.” (Internal quotations
omitted].) Plaintiff asserts that here too, it is unclear whether
the arbitrator would consider Plaintiff’s claims sufficient to warrant
depositions or even written discovery.
SnapMedTech asserts that
Plaintiff’s fear that the arbitrator will limit his ability for discovery is
unfounded considering the Armendariz Court operated under the assumption
that arbitration would be limited in some form by the arbitrator. SnapMedTech
notes that the Armendariz Court found that “it is undisputed that some discovery is often
necessary for vindicating a FEHA claim. Accordingly, whether or not the
employees in this case are entitled to the full range of discovery provided
in Code of Civil Procedure section 1283.05,
they are at least entitled to discovery sufficient to adequately arbitrate
their statutory claim, including access to essential documents and witnesses,
as determined by the arbitrator(s) and subject to limited judicial review
pursuant to Code of Civil Procedure section 1286.2.”
((Armendariz v. Foundation Health Psychcare
Services, Inc., supra, 24
Cal.4th at p. 106.) In addition, Dougherty,
cited by Plaintiff, was not an employment matter and involved different claims.
Plaintiff also asserts that the
Arbitration Agreement lacks mutuality. Plaintiff cites to Armendariz v. Foundation Health Psychcare Services, Inc., supra, 24 Cal.4th at p. 117, where the California Supreme Court
“conclude[d] that Stirlen and Kinney are correct in requiring this
‘modicum of bilaterality’ in an arbitration agreement. Given the disadvantages
that may exist for plaintiffs arbitrating disputes, it is unfairly one-sided
for an employer with superior bargaining power to impose arbitration on the
employee as plaintiff but not to accept such limitations when it seeks to
prosecute a claim against the employee, without at least some reasonable
justification for such one-sidedness based on ‘business realities.’”
Plaintiff
asserts that here, the language of the Arbitration Agreement shows that
it is only the employee giving up their right to a court trial. SnapMedTech counters that there is no
lack of mutuality. As set forth above, the Arbitration Agreement provides, inter
alia, that “Employee . . . agrees to resolve any and all disputes or claims
related to any manner whatsoever to his or his employment with SnapNurse…”
(Sims Decl., ¶ 5, Ex. A.) SnapMedTech notes that in Nguyen v. Applied Medical Resources Corp. (2016) 4 Cal.App.5th 232, 251, the plaintiff “contend[ed] the
arbitration clause lack[ed] mutuality, referencing the sentences beginning
with the word ‘I’ (e.g., ‘I hereby agree to submit to binding arbitration … .’;
‘I further agree … that all disputes … which might arise out of or related to
my employment with the company … will be submitted to binding
arbitration’…According to him, such language require[d] only him but not
defendant to submit to binding arbitration.”
The Nguyen Court
disagreed finding that “[t]he arbitration
clause in this case…provides for arbitration of ‘all disputes and claims
arising out of or relating to the submission of [the] application’ and ‘all
disputes … which might arise out of or relate to my employment with the company.’
Under Baltazar,
such language created a mutual agreement to arbitrate all employment related
disputes.” (Id. at pp. 251-252.) The Nguyen Court also “decline[d] to find that…the mere inclusion of
the words ‘I agree’ by one party in an otherwise mutual arbitration
provision destroys the bilateral nature of the agreement.’” ((Id. at p.
252.)
Plaintiff also argues that the
Arbitration Agreement’s “purported waiver of Plaintiff’s right to act as a PAGA
representative goes to the weight of the unconscionability.” (Opp’n at p.
12:16-17.) Plaintiff cites to Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 360, abrogated on
other grounds by Viking River Cruises, Inc. v. Moriana (2022) 142 S.Ct.
1906, where the
California Supreme Court “conclude[d] that an arbitration agreement requiring
an employee as a condition of employment to give up the right to bring
representative PAGA actions in any forum is contrary to public policy.” As SnapMedTech
notes, the Arbitration Agreement does not expressly reference PAGA actions.
Rather, it provides that “Employee
agrees to pursue any disputes or claims on an individual basis in arbitration.
Specifically, Employee agrees not to pursue, or allow anyone to pursue on his
or her behalf, any claims on a class or collective basis in arbitration or
otherwise.” (Sims Decl., ¶ 5, Ex. A.)
Plaintiff
also notes that the Arbitration Agreement does not contain any language
informing the employee that they are waiving the Constitutional right to a jury
trial. However, Plaintiff does not cite to any legal
authority indicating that the lack of such provision in an Arbitration
Agreement makes it unconscionable.
Based
on the foregoing, the Court finds that Plaintiff has not demonstrated a high
level of substantive unconscionability. In light of the finding of only a low
level of procedural unconscionability, the Court finds that Plaintiff has not
met his burden of demonstrating that the Arbitration Agreement is unenforceable
due to unconscionability.
C. MLK-LA’s Joinder
In its joinder, MLK-LA
argues that the Arbitration Agreement encapsulates Plaintiff’s claims against MLK-LA,
who is a third party beneficiary of the agreement.
“[A] third party
beneficiary of an arbitration agreement may enforce it.” ((Ronay Family Limited Partnership v. Tweed (2013) 216 Cal.App.4th 830, 838.) In Ronay, the Court of Appeal found that “[t]o invoke the third
party beneficiary exception, Tweed and TFI had to show that the arbitration
clause of the account agreement was made expressly for [their] benefit. It
is not necessary that the beneficiary be named and identified as an individual.
A third party may enforce a contract where he shows that he is a member of a
class of persons for whose benefit it was made.” ((Id.
at pp. 838-839 [internal quotations
and citations omitted].)
In the Complaint, Plaintiff alleges that he was hired by
SnapMedTech and assigned to MLK-LA. (Compl., ¶ 8; see also Compl., ¶ 26,
“[d]espite signing a new employment agreement with SnapNurse for assignment at
MLKCH…”) MLK-LA argues that the Arbitration Agreement “explicitly states that
any and all claims or disputes arising from Plaintiff employment shall be
resolved by binding arbitration. Since Plaintiff identifies that SNAPMEDTECH
assigned Plaintiff to work at MLK-LA, MLK-LA is an express third-party
beneficiary, and can now enforce the Agreement.” (Joinder at p. 6:11-14.)
But as Plaintiff notes,
MLK-LA does not provide evidence demonstrating that the Arbitration Agreement
was made for its benefit.
Plaintiff notes that in Jensen v. U-Haul Co.
of California (2017) 18
Cal.App.5th 295, 301, the
Court of Appeal found that “[t]he test for determining whether a contract was
made for the benefit of a third person is whether an intent to benefit a third
person appears from the terms of the contract.”
The Court does not find that MLK-LA has shown that an intent to benefit MLK-LA appears
from the terms of the subject Arbitration Agreement. As Plaintiff notes, the Arbitration
Agreement does not expressly indicate that it applies to the companies where
Plaintiff is assigned.
MLK-LA also asserts that
Plaintiff’s claims against it should be compelled to arbitration under the
doctrine of equitable estoppel. In addition, MLK-LA asserts that nonsignatories of an arbitration agreement may invoke arbitration agreements under ordinary agency and
contract principles.
MLK-LA cites to Garcia v. Pexco, LLC (2017) 11 Cal.App.5th 782, 784, where “Narciso Garcia appeal[ed] from an order granting
defendant Pexco, LLC’s (Pexco) motion to compel arbitration. Garcia opposed the
motion on the ground Pexco was not a party to the arbitration agreement.” The
Court of Appeal found that “Garcia is equitably estopped from denying Pexco’s
right to arbitrate and the agency exception applies.” ((Ibid. .)
In Garcia, “[t]emporary staffing
company Real Time Staffing Services, LLC, doing business as Select Staffing
(Real Time), hired Garcia in 2011 as an hourly employee. Real Time then
assigned Garcia to work for Pexco. As part of the hiring process with Real
Time, Garcia filled out an employment application which included an
arbitration agreement between Garcia and Real Time. Pexco [was] not a signatory
to the arbitration agreement. The arbitration agreement provided that ‘any
dispute’ Real Time and Garcia could not resolve informally would be determined
by binding arbitration. The arbitration agreement also specifically defined
disputes subject to arbitration as including, but not limited to, those
regarding wages, vacation pay, sick time pay, overtime pay, state and federal
employment laws and regulation, including but not limited to, the Fair
Labor Standards Act of 1938…including the Equal Pay Act of 1963...” (Garcia v.
Pexco, LLC, supra,
at pp. 784-785.)
The Garcia Court
noted that “Courts recognize exceptions
to the general rule which allow nonsignatories to compel arbitration of a
dispute arising out of the scope of the agreement. One of the exceptions is equitable estoppel.
Under this exception, a nonsignatory defendant may invoke an arbitration clause
to compel a signatory plaintiff to arbitrate its claims when the causes of
action against the nonsignatory are intimately founded in and intertwined with
the underlying contract obligations. The doctrine applies where the
claims are based on the same facts and are inherently inseparable from the
arbitrable claims against signatory defendants.” ((Id. at pp.
785-786 [internal quotations and citations omitted].)
The Garcia Court found that “[o]n these facts, it is inequitable for the
arbitration about Garcia’s assignment with Pexco to proceed with Real Time,
while preventing Pexco from participating. This is because Garcia’s claims
against Pexco are rooted in his employment relationship with Real Time,
and the governing arbitration agreement expressly includes statutory wage and
hour claims. Garcia does not distinguish between Real Time and Pexco in
any way. All of Garcia’s claims are based on the same facts alleged against
Real Time. Garcia cannot attempt to link Pexco to Real Time to hold it liable
for alleged wage and hour claims, while at the same time arguing the
arbitration provision only applies to Real Time and not Pexco. Garcia agreed to
arbitrate his wage and hour claims against his employer, and Garcia alleges
Pexco and Real Time were his joint employers. Because the arbitration agreement
controls Garcia’s employment, he is equitably estopped from refusing to
arbitrate his claims with Pexco.”
((Id. at pp. 787-788.)
MLK-LA asserts that here, Plaintiff’s claims against MLK-LA arise
solely from and, are connected to, his employment with SnapMedTech, making his
claims against SnapMedTech and MLK-LA inseparable and intertwined. MLK-LA
also notes that similar to Garcia, Plaintiff here alleges that
“Plaintiff is informed, believes, and alleges that at all times relevant
herein, defendants SnapNurse and MLK-LA were his joint employers.” (Compl., ¶
10; see also Compl., ¶ 31, “Plaintiff is informed, believes, and alleges
that defendants MLK-LA, SnapNurse, and DOES 1 through 6 inclusive, were his
joint employers within the meaning of the FEHA.”)
Plaintiff asserts that the gravamen
of Plaintiff’s factual allegations of harassment, discrimination and
retaliation are against Defendant MLK-LA, not SnapMedTech. Plaintiff asserts that the only factual
allegations against SnapMedTech
are that it was copied on one of Plaintiff’s complaints, and that SnapMedTech notified Plaintiff
that his contract at MLK-LA was not
going to be renewed. (Compl., ¶¶ 27-28.) However, each of the causes of action
of the Complaint (except for the eighth cause of action) is alleged against
both Defendants.
Plaintiff also cites to Jarboe v. Hanlees Auto Group (2020) 53 Cal.App.5th 539, 554, and notes that the Court of Appeal in
that case found that “[t]he only conclusion that can be drawn on this record is
that there is some relationship
between Hanlees and its affiliated dealerships. But
it is unclear what that relationship may be and it has not been shown to
be integral to support the
application for equitable estoppel.” (Emphasis omitted.) Plaintiff asserts that
Defendants have not shown that they are “integrally” related in such a
way that equitable estoppel principles would permit enforcement of the
agreement by a nonparty to the agreement.
However, the Court finds that Garcia v. Pexco, LLC, supra, 11
Cal.App.5th 782 is on
point here. As set forth above, the Court of Appeal in that case found that “Garcia
agreed to arbitrate his wage and hour claims against his employer, and Garcia
alleges Pexco and Real Time were his joint employers. Because the arbitration
agreement controls Garcia’s employment, he is equitably estopped from refusing
to arbitrate his claims with Pexco.” ((Id. at p. 788.) Similarly here,
Plaintiff alleges that SnapNurse
and MLK-LA were his joint employers (Compl., ¶ 10), and each of the causes of
action (except for the eighth cause of action) is alleged against both
Defendants.
Conclusion
For the foregoing reasons, SnapMedTech’s motion to compel
arbitration is granted. MLK-LA’s
joinder is granted.
The entire action is stayed pending completion of
arbitration of Plaintiff’s arbitrable claims against SnapMedTech and MLK-LA.
The Court sets an arbitration completion status conference
on _______________ 2023, at 10:00 a.m. in Dept. 50. The parties are ordered to
file a joint report regarding the status of the arbitration five court days
prior to the status conference, with a courtesy copy delivered directly to
Department 50.¿¿
SnapMedTech is ordered to provide
notice of this Order.¿
DATED:
________________________________
Hon. Teresa A.
Beaudet
Judge, Los
Angeles Superior Court
[1]Each of the causes
of action of the Complaint are alleged against MLK-LA,
and each of the causes of action of the Complaint except for the eighth cause
of action are alleged against SnapMedTech.
[2]SnapMedTech and MLK-LA are referred to jointly herein as “Defendants.”