Judge Theresa M. Traber, Case 20STCV03227 2022-09-19 Tentative Ruling

Judge: Theresa M. Traber, Case: 20STCV03227, Date: 2022-09-19 Tentative Ruling

Case Number: 20STCV03227 Hearing Date: September 19, 2022 Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE: September 19, 2022 TRIAL DATE: March 21, 2023

CASE: James Legare v. Lebo Automotive, Inc.

CASE NO.: 20STCV03227

MOTION TO COMPEL ARBITRATION AND MOTION TO STRIKE REPRESENTATIVE PAGA CLAIMS

MOVING PARTY: Defendant Lebo Automotive, Inc.

RESPONDING PARTY(S): Plaintiff James Legare

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is a PAGA action for wage and hour violations, filed on January 27, 2020 with a First Amended Complaint file don April 17, 2020.

Defendant moves to compel arbitration of Plaintiff’s individual PAGA claim, strike Plaintiff’s representative PAGA claims, and stay the lawsuit pending completion of the arbitration.

TENTATIVE RULING:

Defendant’s Motion to Compel Arbitration is GRANTED with respect to Plaintiff’s PAGA claims on behalf of himself as an aggrieved employee.

Defendant’s Motion to Strike is DENIED.

The Court orders the parties to brief the question of whether it should stay litigation of the representative PAGA claims, pending the arbitration of Plaintiff’s individual claims. The Court will set a briefing schedule at the hearing on the stay motion.

DISCUSSION:

Defendant moves to compel Plaintiff’s individual PAGA claim to arbitration, to strike the remaining representative PAGA claims, and to stay the action pending arbitration. The Court addresses each motion separately.

Motion to Compel Arbitration

Defendant first moves to compel Plaintiff’s individual PAGA claim to arbitration.

Existence of Arbitration Agreement

Under California law, arbitration agreements are valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. (Blake v. Ecker (2001) 93 Cal.App.4th 728, 741 (overruled on other grounds by Le Francois v. Goel (2005) 35 Cal.4th 1094).) 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.)

Defendant argues that Plaintiff signed two documents containing arbitration clauses. The first document, which was part of Plaintiff’s application for employment, is titled an “Applicant Statement and Agreement,” and provides, in relevant part:

I also acknowledge that the Company utilizes a system of alternative dispute resolution which involves binding arbitration to resolve all disputes which may arise out of the employment context. … I and the Company both agree that any claim, dispute, and/or controversy that either party may have against one another … which would otherwise require or allow resort to any court or other governmental dispute resolution forum… arising from, related to, or having any relationship or connection whatsoever with my seeking employment with, employment, or other association with the company, whether based on tort, contract, statutory, or equitable law, or otherwise, … shall be submitted to and determined exclusively by binding arbitration…In order to provide for the efficient and timely adjudication of claims, the arbitrator is prohibited from consolidating the claims of others into one proceeding. This means that an arbitrator will hear only my individual claims and does not have the authority to fashion a proceeding as a class or collective action or to award relief to a group of employees in one proceeding. Thus, the Company has the right to defeat any attempt by me to file or join other employees in a class, collective or joint action lawsuit or arbitration (collectively ‘class claims’). I and the Company both agree that any challenge to the prohibition against consolidating the claims of others into a single proceeding, whether as a class, a representative action or otherwise is a gateway issue and shall be determined by the Superior Court, and any substantive claims shall not be decided by the arbitrator until after the gateway determination is made by the Court.

(Defendant’s Exh. B.) Plaintiff signed and dated the Applicant Statement and Agreement on June 15, 2017. (Id.) The second document was part of Plaintiff’s employment packet, is titled “Mandatory Arbitration Agreement,” and provides, in relevant part:

I agree that any claim, dispute, and/or controversy (including, but not limited to any claims of discrimination and harassment) which would otherwise require or allow resort to any court or other governmental dispute resolution forum, between me and the Company… arising from, relating to, or having any relationship or connection whatsoever with my seeking employment with, employment by, or other association with the Company, whether based on tort, contract, statutory, or equitable law, or otherwise, shall be submitted to and determined exclusively by binding arbitration under the Federal Arbitration Act…

(Defendant’s Exh. C.) Plaintiff signed and dated the Mandatory Arbitration Agreement on June 22, 2017. (Id.) Plaintiff challenges the existence of the arbitration agreement on two bases: first, by challenging its authenticity, and second, by arguing that its terms are insufficiently defined.

1. Challenge to Authenticity

In opposition, Plaintiff challenges the authenticity of the documents by offering a verified declaration under penalty of perjury that Plaintiff does not recall either of these documents and does not remember signing them. (Declaration of James Legare ISO Opp. ¶ 3.) Plaintiff further contends that, had he known of the documents and had their provisions explained to him, he would not have signed the documents. (Id. ¶ 10.) When a plaintiff challenges the authenticity of an arbitration agreement, the defendant must establish the existence of a valid arbitration agreement with admissible evidence by a preponderance of the evidence. (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 166.) A plaintiff may challenge the authenticity of an arbitration agreement by declaring under penalty of perjury that the plaintiff does not recall seeing or signing the agreement. (Id.) Plaintiff correctly states that Defendant does not produce admissible evidence in its moving papers that Plaintiff saw and signed the arbitration agreements. The declaration of Rozz Bowen states that Plaintiff signed both documents, but despite a boilerplate statement of ability to attest to the matters asserted in the declaration, the declaration sets forth no preliminary facts sufficient to show personal knowledge. (See Snider v. Snider (1962) 200 Cal.App.2d 741, 754 [bare statement of competency to testify should be ignored when the facts do not show sufficient knowledge]; Evid. Code §§ 403(a)(2), 702(a).)

However, in reply, Defendant offers evidence that Plaintiff submitted a demand to arbitrate his individual wage and hour claims with Judicate West on August 17, 2022. (See Declaration of Alex A. Zolg ISO Reply, ¶¶ 7-9, Exh. 2.) Defendant contends that Plaintiff has relied upon the same arbitration provision at issue here in demanding arbitration on his individual claims. The Court finds that this evidence is sufficient to meet Defendant’s burden to establish the authenticity of the arbitration agreement. By seeking to compel arbitration under its terms, Plaintiff has manifested assent to the agreement.

2. Definition of Parties

Plaintiff also argues in opposition that the agreement is not enforceable because it does not specify who the “Company” named in the arbitration provisions is. Plaintiff relies on Julie Flores v. Nature Best Distribution LLC (2016) 7 Cal.App.5th 1, in support of this position. However, Flores is distinguishable in that there were four named defendants in that case, and it was not clear from the text of the arbitration agreement which were entitled to compel arbitration. (Flores, supra, 7 Cal.App.5th at 3, 9-10.) Here, there is only one named Defendant, and nowhere in the entirety of the record is there any indication of another corporate entity who might be a party to the agreement. The Court therefore declines to find that the arbitration agreement is not enforceable on this basis.

For the foregoing reasons, the Court finds that there is an enforceable arbitration agreement between the parties.

Applicability of the FAA

The arbitration agreement states that it is governed by the Federal Arbitration Act. (Defendant’s Exhs. B-C.) In opposition, Plaintiff contends that the FAA does not apply to this agreement, because state statutory wage and hour claims are not subject to arbitration, and these statutes are not pre-empted by the FAA because wage and hour claims are not interstate commerce. Plaintiff relies on Hoover v. American Income Life Insurance Co. (2012) 206 Cal.App.4th 1193 in support of this contention, but this case is plainly distinguishable from this case. The collective bargaining agreement in Hoover said nothing about the applicability of the Federal Arbitration Act in its text. (Hoover, supra, 206 Cal.App.4th 1198-1200.) Here, in contrast, the arbitration agreement plainly states that any claims to be arbitrated are subject to the Federal Arbitration Act. The Court therefore finds that the agreement is, in fact, subject to the Federal Arbitration Act.

Ability to Compel PAGA Claims

As an initial matter, the Court concludes that Plaintiff’s PAGA claim falls within the scope of the parties’ arbitration agreement. This agreement to arbitrate covers “all disputes which may arise out of the employment context,” including “any claim, dispute, and/or controversy that either party may have against one another … which would otherwise require or allow resort to any court or other governmental dispute resolution forum… arising from, related to, or having any relationship or connection whatsoever with my seeking employment with, employment, or other association with the company, whether based on tort, contract, statutory, or equitable law, or otherwise.” (Defendant’s Exh. B; see also Defendant’s Exh. C [similarly sweeping language].) Plaintiff’s claim to recover PAGA civil penalties and his status as an “aggrieved” employee under that statute arise from his employment with Defendant and, thus, fall within the scope of the arbitration agreement’s language. Further, there is no provision of the parties’ contract that exempts PAGA claims from the scope of the arbitration agreement.

As Defendant rightly argues in its moving papers, the question of whether Plaintiff’s PAGA claim may be compelled to arbitration must be resolved by examining the California Supreme Court’s landmark decision in Iskanian v. CLS Transportation Los Angeles, LLC (2014) 58 Cal.4th 380 (“Iskanian”), and the U.S. Supreme Court’s recent ruling in Viking River Cruises Inc. v. Moriana (2022) 142 S. Ct. 1906 (“Moriana”), on whether any aspect of Iskanian’s holding is inconsistent with the FAA and, thus, preempted by federal law.

The California Supreme Court held in Iskanian that where “an employment agreement compels the waiver of representative claims under the PAGA, it is contrary to public policy and unenforceable as a matter of state law.” (Id., at pp. 383-384.) The Court also ruled that an agreement that permitted the employee to bring only “individual” PAGA claims does not permit its enforcement because splitting the individual and representative claims in this manner “does not serve the purpose of the PAGA.” (Id., at p. 384.) In addition, the Iskanian Court held that a PAGA claim lies outside the FAA’s coverage because it is an action held by the State, rather than a dispute between an employee and employer. (Id., at p. 388.) Based on this reasoning, the Court concluded that “California's public policy prohibiting waiver of PAGA claims, whose sole purpose is to vindicate the Labor and Workforce Development Agency's interest in enforcing the Labor Code, does not interfere with the FAA's goal of promoting arbitration as a forum for private dispute resolution.” (Id., at pp. 388-389.)

In Moriana, the U.S. Supreme Court approved the Iskanian rule that private arbitration agreements cannot effectuate “a wholesale waiver of PAGA claims,” holding that such a state rule is not preempted by the FAA. (Moriana, at p. 1925.) In so doing, the U.S. Supreme Court held that “the FAA does not require courts to enforce contractual waivers of substantive rights and remedies.” (Id., at p. 1919.) It also resisted the employer’s contention that a state rule invalidating contractual bans on representative PAGA actions should be treated the same as state nullifications of class-action prohibitions, which the high court had held to be preempted by the FAA in AT&T Mobility LLC v. Concepcion (2011) 131 S. Ct. 1740. Instead, the Moriana Court held that a representative PAGA action litigated by an aggrieved employee on behalf of the State was significantly different from a class action where a plaintiff prosecuted the individual claims of absent class members. (Id., at pp. 1920-1921.) It also dismissed the notion that allowing arbitration of representative actions was necessarily contrary to the “bi-lateral” nature of arbitrations and, thus, incompatible with the FAA. (Id., at pp. 1921-1923.) Accordingly, the Court ruled that the FAA does not preempt state laws, like the holding in Iskanian, that invalidate contractual prohibitions on arbitrating PAGA representative claims. (Id.)

The Moriana Court next addressed what it described as the secondary Iskanian rule and found it to be preempted by FAA “insofar as it precludes the division of PAGA actions into individual and non-individual claims through an agreement to arbitration.” (Moriana, at p. 1924.) The Court’s analysis was based principally on its interpretation of PAGA’s standing and claim joinder rules. (Id. at pp. 1923-1924.) The Court observed that PAGA “permits ‘aggrieved employees’ to use the Labor Code violations they personally suffered as a basis to join to the action any claims that could have been raised by the State in an enforcement proceeding.” (Id., at p. 1923.) The Moriana Court concluded that “Iskanian’s secondary rule prohibits parties from contracting around this joinder device because it invalidates agreements to arbitrate only ‘individual PAGA claims for Labor Code violations that an employee suffered.’” (Id.) It reasoned that Iskanian’s “prohibition on contractual division of PAGA actions into constituent claims unduly circumscribes the freedom of parties to determine ‘the issues subject to arbitration’ and ‘the rules by which they will arbitrate,’ and does so in a way that violates the fundamental principle that ‘arbitration is a matter of consent.’” (Id.) Therefore, the Moriana Court concluded, “state law cannot condition the enforceability of an arbitration agreement on the availability of a procedural mechanism that would permit a party to expand the scope of the arbitration by introducing claims that the parties did not jointly agree to arbitrate.” (Id.)

As a bottom line, then, Moriana holds that an employee who has entered into an enforceable arbitration agreement may be compelled to arbitrate his “individual” PAGA claims, that is, those arising from Labor Code violations suffered by the employee, rather than other aggrieved parties. The question of whether such a result should follow a judicial refusal to enforce a waiver of representative PAGA claims involves analysis of the contract’s severability provision, if any. (Id., at p. 1925.)

Applying Moriana’s holding here, the Court must determine: (1) whether the parties’ agreement effectuates a “wholesale waiver” of representative PAGA claims and, thus, is unenforceable as contrary to California public policy; and (2) if so, whether the agreement’s severability clause permits arbitration of Plaintiff’s “individual” PAGA claim. If such an arbitration is warranted, the final question is what becomes of the non-individual claims of other aggrieved employees.” The last issue is addressed by the Court below in its evaluation of Defendant’s motion to strike.

The answer to the first question is clear. The agreement here includes a broad waiver of Plaintiff’s rights to participate in any class or representative action that asserts the claims of other individuals. Specifically, the waiver provision states:

In order to provide for the efficient and timely adjudication of claims, the arbitrator is prohibited from consolidating the claims of others into one proceeding. This means that an arbitrator will hear only my individual claims and does not have the authority to fashion a proceeding as a class or collective action or to award relief to a group of employees in one proceeding. Thus, the Company has the right to defeat any attempt by me to file or join other employees in a class, collective or joint action lawsuit or arbitration (collectively ‘class claims’). I and the Company both agree that any challenge to the prohibition against consolidating the claims of others into a single proceeding, whether as a class, a representative action or otherwise, is a gateway issue and shall be determined by the Superior Court, and any substantive claims shall not be decided by the arbitrator until after the gateway determination is made by the Court.

(Defendant’s Exh. B [emphasis added].) Defendant’s motion to compel arbitration of Plaintiff’s “individual” PAGA claim and strike “the remaining representative PAGA claims” poses the “gateway issue” of whether the arbitration agreement’s “prohibition against consolidating the claims of others into a single proceeding, whether as a class, a representative action or otherwise” is enforceable. (Id.) The Court finds that the agreement’s total ban on PAGA representative actions runs afoul of the central holding of Iskanian and, thus, is unenforceable as contrary to California public policy. (Ibid., at p. 383.)

The Court now turns to the second inquiry of whether the Court may compel arbitration of Plaintiff’s “individual” PAGA claim, finding that such an order is proper here. The severability clause in the parties’ agreement provides that any provision “declared void or unenforceable . . . shall be severed and the remainder of the agreement shall be enforced.” (Defendant’s Exh. B.) The provisions left standing after this severance include the core language of the agreement requiring the arbitration of all claims arising out of Plaintiff’s employment. Thus, applying the commands of the U.S. Supreme Court in Moriana, the Court orders Plaintiff’s “individual” PAGA claim to arbitration.

Conclusion

Accordingly, for the reasons explained above, Defendant’s Motion to Compel Arbitration is GRANTED with respect to Plaintiff’s PAGA claims on behalf of himself as an aggrieved employee.

Motion to Strike

Defendant moves to strike Plaintiff’s representative PAGA claims under two alternative theories: first, that Plaintiff’s representative claims should be stricken under Moriana, and second, that Plaintiff’s representative claims should be dismissed as unmanageable.

Legal Standard

The court may, upon a motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading. Code Civ. Proc., § 436(a). The court may also strike all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court. Id., § 436(b). The grounds for a motion to strike are that the pleading has irrelevant, false or improper matter, or has not been drawn or filed in conformity with laws. Id.§ 436. The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. Id.§ 437. “When the defect which justifies striking a complaint is capable of cure, the court should allow leave to amend.” Vaccaro v. Kaiman (1998) 63 Cal.App.4th 761, 768. A motion to strike can be used where the complaint or other pleading has not been drawn or filed in conformity with applicable rules or court orders. Code Civ. Proc., § 436(b). This provision is for "the striking of a pleading due to improprieties in its form or in the procedures pursuant to which it was filed." Ferraro v. Camarlinghi (2008) 161 Cal.App.4th 509, 528 (emphasis in original).

Meet and Confer

Before filing a motion to strike, the moving party shall meet and confer in person or by telephone with the party who has filed the pleading subject to the motion to strike and file a declaration detailing their meet and confer efforts. (Code Civ. Proc., § 435.5(a).) However, an insufficient meet and confer process is not grounds to grant or deny a motion to strike. (Code Civ. Proc., § 435.5(a)(4).)

Defendant offers no evidence whatsoever that the parties ever met and conferred regarding this motion to strike. Defendant has not met its burden under the statute. However, the Court will overlook this procedural defect and address the motion on its merits.

Standing

Defendant first argues that Plaintiff’s representative PAGA claims should be stricken or dismissed for lack of standing based on the U.S. Supreme Court’s interpretation in Moriana of standing principles under PAGA. The Moriana Court held that, after the plaintiff’s “individual” PAGA claim had been relegated to arbitration, the non-individual aspect of the PAGA action had to be dismissed based on the plaintiff’s lack of standing. The Court posited:

[A]s we see it, PAGA provides no mechanism to enable a court to adjudicate non-individual PAGA claims once an individual claim has been committed to a separate proceeding. Under PAGA's standing requirement, a plaintiff can maintain non-individual PAGA claims in an action only by virtue of also maintaining an individual claim in that action. See Cal. Lab. Code Ann. §§ 2699(a), (c). When an employee's own dispute is pared away from a PAGA action, the employee is no different from a member of the general public, and PAGA does not allow such persons to maintain suit. . . . As a result, Moriana lacks statutory standing to continue to maintain her non-individual claims in court, and the correct course is to dismiss her remaining claims.

(Moriana, 142 S. Ct. at p. 1925 [Citation omitted].) In her separate concurring opinion, Justice Sotomayor noted, however, that “if this Court’s understanding of state law is wrong, California courts, in an appropriate case will have the last word.” (Id., at p. 1925.)

This Court concludes that the Moriana Court’s assessment of PAGA standing – a pure question of state law – is at odds with California Supreme Court precedent on the issue and, thus, declines to dismiss this case as was suggested by the federal court. In Kim v. Reins (2020) 9 Cal. 5^th 73 (“Kim”), the California Supreme Court addressed whether employees lose standing to bring PAGA claims if they settle and dismiss their individual claims. The Supreme Court in Kim explained that PAGA’s plain language established only two requirements for standing: (1) “the plaintiff must be an aggrieved employee” (2) “against whom one or more of the alleged violations was committed.” (Id., at pp. 83-84 [Citing Cal. Labor Code § 2699(c)].) Applying this statutory standard to the settling plaintiff, the Kim Court held that the plaintiff retained standing to sue under PAGA even after he settled his individual claims because he “was employed by Reins and alleged that he personally suffered at least one Labor Code violation on which the PAGA claim is based.” (Id., at p. 84.) Because the California Supreme Court, and not the U.S. Supreme Court, is the final arbiter of state law, this Court applies the Kim holding to evaluate Plaintiff’s standing to bring representative PAGA claims in the wake of an order compelling his “individual” PAGA claim to arbitration.

The allegations of Plaintiff’s Complaint reveal that he was employed by Defendant and claims to have suffered at least one of the asserted PAGA Labor Code violations. (Complaint, ¶ 3, 15, 18, 20.) As a result, he satisfies the definition of an aggrieved employee with standing to pursue PAGA penalties on behalf of the state. (Kim, supra, at pp. 83-84; see also, e.g., Shams v. Revature LLC (N.D. Cal. August 17, 2022) __ F.Supp. 3d __, 2202 WL 3453068 at 3.) The Court therefore rejects Defendant’s request that the non-individual PAGA claims be stricken or dismissed for lack of standing.

Manageability

Defendant also moves to strike Plaintiff’s representative claims as unmanageable.

There is currently a split of authority as to whether the Court has the inherent power to strike PAGA claims on manageability grounds. Wesson v. Staples the Office Superstore, LLC (2021) 68 Cal.5th 736, decided by a Second District panel, affirms that a trial court has the inherent power to strike PAGA claims as unmanageable. However, in Estrada v. Royalty Carpet Mills, Inc. (2022) 76 Cal.App.5th 685, the Fourth District Court of Appeal held that trial courts do not have the power to strike PAGA claims as unmanageable. Defendant argues in its reply brief that Estrada is not binding because the California Supreme Court granted review of this case earlier this year, and thus, under California Rule of Court Rule 8.1115(e)(1), while review is pending, this opinion is of persuasive value only. But the comment to this subdivision states, in relevant part:

Under the authority recognized by subdivision (e)(3) of this rule, and as explained in the second paragraph of the comment to that subdivision, by standing administrative order of the Supreme Court, superior courts may choose to be bound by parts of a published Court of Appeal decision under review when those parts conflict with another published appellate court decision. (See Auto Equity Sales, Inc. v. Superior Court (1962) 57 Cal.2d 450, 456 (Auto Equity) ["where there is more than one appellate court decision, and such appellate decisions are in conflict[,] . . . the court exercising inferior jurisdiction can and must make a choice between the conflicting decisions"].)

(Cal. Rules of Court Rule. 8.1115 Comment Subdivision (e)(1).) Thus, that Estrada is pending review does not render it inherently non-binding for the purposes of this issue. In any event, the Court need not resolve the split of authority at this time. If the Court were to adopt Estrada, the motion to strike would be denied for lack of authority to grant the requested relief. Likewise, if the Court were to adopt Wesson, the Court would exercise its discretion to deny the motion to strike on the merits, as addressed herein.

1. Failure to Provide Meal and Rest Periods

Defendant contends that Plaintiff’s claims of meal and rest period violations are unmanageable.

Employers are required to provide meal periods, and to authorize and permit their employees to take rest breaks. (Lab. Code §§ 226.7, 512(a); (Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1034.) An employer satisfies this obligation if it “relieves its employees of all duty, relinquishes control over their activities and permits them a reasonable opportunity to take an uninterrupted […] break, and does not impede or discourage them from doing so.” (Brinker, supra, at 1031.)

Here, Plaintiff claims that Defendant refused to provide meal and rest periods in violation of California Law. (FAC ¶¶ 27-33.) Defendant makes the conclusory assertion that, since Defendant had a policy of providing meal and rest periods, Plaintiff’s claims are unmanageable as a matter of law. Not so. Rest periods, and by extension, meal periods, are generally subject to common proof. (Brinker, supra, 53 Cal.4th at 1033, 1036.) The Court declines to rule at this juncture that the claims are not manageable as a matter of law purely on the basis that Defendant had a formal policy to the contrary.

2. Failure to Provide Accurate Wage Statements

Defendant contends that Plaintiff’s claims of failure to provide accurate wage statements are unmanageable.

Employers are required to provide complete and accurate wage statements. (Lab. Code § 226.) Defendant makes the conclusory assertion, based on the Declaration of Ms. Bowen, that it is “unlikely” that Plaintiff can demonstrate any pattern of failing to provide accurate wage statements. (See Bowen Decl. ¶¶ 5-9.) A brief listing of the different titles of the aggrieved employees and a general statement that amounts to “different employees are different” is not remotely sufficient to warrant striking this claim as unmanageable.

3. Failure to Pay Overtime Wages and Wages Due to Discharged and Quitting Employees

Defendant also contends that Plaintiff’s claims of failure to pay overtime wages and wages due to discharged and quitting employees are unmanageable.

Employers are required to compensate employees for overtime. (Lab Code §§ 510, 1194.) Employees may be exempt from the payment of overtime if they earn more than 150% of the minimum wage and receive compensation of more than 50% commissions. (Peabody v. Time Warner Cable, Inc. (2014) 59 Cal.4th 662.) A terminated employee must be paid all unpaid wages at the time of termination, and a quitting employee must be paid within 72 hours. (Lab. Code §§ 201, 202.) Defendant again makes conclusory assertions that these claims require individualized assessments and cannot be subject to common proof. Defendant cites no law in support of this proposition whatsoever. The Court therefore declines to find that these claims are unmanageable based on this thin showing.

For the foregoing reasons, the Court finds that Plaintiff’s representative PAGA claims are not unmanageable.

Conclusion

Accordingly, Defendant’s Motion to Strike is DENIED.

Motion to Stay

Defendant moves to stay Plaintiff’s representative PAGA claims until arbitration has been completed under Code of Civil Procedure §1281.4.

Code of Civil Procedure section 1281.4 provides: “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. [¶]... [¶] If the issue which is the controversy subject to arbitration is severable, the stay may be with respect to that issue only.”

The Court finds that the parties’ briefing on the proposed stay is limited and does not address the specific circumstances shaped by the Court’s ruling on the motions to compel arbitration and to strike. For this reason, the Court orders the parties to brief the propriety of a stay of the representative PAGA claims, including whether the aggrieved parties’ right to engage in discovery under the Code of Civil Procedure weakens the reasons for a stay and the extent to which the arbitration of Plaintiff’s individual claims will have a collateral estoppel effect on his standing to bring the representative claims in this lawsuit. The Court will set a briefing schedule at the hearing on the stay motion.

CONCLUSION:

For the reasons above, Defendant’s Motion to Compel Arbitration is GRANTED with respect to Plaintiff’s PAGA claims on behalf of himself as an aggrieved employee.

Defendant’s Motion to Strike is DENIED.

Moving Party to give notice.

IT IS SO ORDERED.

Dated: September 19, 2022 ___________________________________

Theresa M. Traber

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.