Judge: Theresa M. Traber, Case: 22STCV05062, Date: 2023-02-22 Tentative Ruling
Case Number: 22STCV05062 Hearing Date: February 22, 2023 Dept: 47
Tentative Ruling
Judge Theresa M. Traber, Department 47
HEARING DATE: February 22, 2023 TRIAL DATE:
NOT SET
CASE: Jesus Nunez v. The Micro Connection
Enterprises, Inc., et al.
CASE NO.: 22STCV05062 ![]()
MOTION
TO COMPEL ARBITRATION
![]()
MOVING PARTY: Defendants The Micro Connection Enterprises, Inc.;
Personal Care Performance Group, Inc., and ESG Personnel Leasing (Doe 1)
RESPONDING PARTY(S): Plaintiff Jesus
Nunez
STATEMENT
OF MATERIAL FACTS AND/OR PROCEEDINGS:
This is an action, filed on February 9, 2022, under the Private Attorneys
General Act of 2004 for multiple wage and hour violations. Plaintiff alleges
that Defendants regularly failed to pay wages owed, failed to provide meal and
rest periods, and failed to provide accurate wage statements, and terminated
Plaintiff in retaliation for complaining about these failures.
Defendants move to compel
arbitration and stay this action.
TENTATIVE RULING:
Defendants’ motion to compel
Plaintiff’s individual claims, including Plaintiff’s individual PAGA claims to
binding arbitration is GRANTED
Plaintiff’s
representative PAGA claims are ordered STAYED pending resolution of the
arbitration, unless and until a contrary result is required by the California
Supreme Court in its ruling in the pending case of Adolph v. Uber
Technologies, S274671.
All
hearings on this matter are placed off-calendar.
The Court
sets a hearing on the status of Adolph v. Uber Technologies and of the
arbitration as a whole for August 22, 2023, at 9:00 AM.
DISCUSSION:
Defendants move to compel
arbitration and stay this action. Defendants also request that the Court
dismiss Plaintiff’s representative claims under the Private Attorneys General
Act of 2004 (PAGA).
Plaintiff’s Evidentiary Objections
Plaintiff
raises numerous objections to the declarations of Robert Compani and Sally
Villalobos filed in support of this motion. Plaintiff cites no law requiring
the Court to rule on objections in connection with a motion to compel
arbitration, as opposed to a special motion to strike under Code of Civil
Procedure section 425.16, or a motion for summary judgment or adjudication
under section 473(c). Further, the Court finds that Plaintiff’s evidentiary
objections are without merit, attacking the weight of the statements and
evidence provided rather than their admissibility. These objections are
therefore OVERRULED.
Defendants’ Requests for Judicial Notice
Defendants
request that the Court take judicial notice of (1) Micro Connection’s
registration of Personal Care Performance Group as a fictitious business name;
(2) ESG’s Statement of Information filed with the California Secretary of State
on October 5, 2021; (3) ESG’s Statement of Information filed with the
California Secretary of State on August 25, 2022; and (4) the statement of
ESG’s current status on the California Secretary of State website as of
February 8, 2023.
Defendants’
requests are GRANTED pursuant to Evidence Code section 452(c) (official acts of
the executive branch of this state). In so doing, the Court takes notice only
of the existence of these documents, not of the truth of their contents.
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.)
Defendants
offer, as proof of an arbitration agreement with the Plaintiffs, a document
entitled Dispute Resolution Agreement presented in English. (Declaration of Ashley
N. Pham ISO Mot. Exh. A.) The document bears Plaintiff’s signature and is dated
October 5, 2020. (Id.) The document states that it is an agreement
between the signatory and ESG Personnel Leasing. (Id.)
Plaintiff
argues that this document does not match the documents identified in other
exchanges between the parties, or with the documents produced in discovery. Plaintiff
also points out that the document produced contains inconsistent pagination and
image quality. Plaintiff contends that these defects in the reproduction render
the authenticity of the document suspect. However, Plaintiff has not provided
the referenced documents for comparison. Defects in the reproduction of the
agreement, without actual evidence challenging its authenticity, are not
sufficient for the Court to reject Defendants’ evidence, provided under penalty
of perjury, that Plaintiff contracted with ESG to arbitrate certain claims.
The Court
therefore finds that there is an agreement to arbitrate between Defendant ESG
and the Plaintiff.
Applicability of the FAA
The Agreement
states “Any arbitration proceeding under this agreement shall proceed under and
be governed by the Federal Arbitration Act (“FAA”).” (Pham Decl. Exh. A § 7.) Plaintiff
does not dispute that the Federal Arbitration Act governs the arbitration
agreements.
Scope of the Arbitration Agreements
Defendants
contend that the scope of the Agreement covers all of Plaintiffs’ individual
claims, including Plaintiff’s PAGA claims. Plaintiffs dispute this contention.
“The scope
of arbitration is a matter of agreement between the parties.” (See, e.g., Ericksen,
Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak Street (1983) 35
Cal.3d 312, 323.) “A party can be compelled to arbitrate only those issues it
has agreed to arbitrate.” (Perez v. U-Haul Co. of California (2016) 3
Cal.App.5th 408, 419.)
The Agreement
states, in relevant part:
1. I and ESG Personnel Leasing, Inc. (“the
Company”) all subsidiaries, and contracted clients agree to utilize binding
individual arbitration to resolve all disputes that might arise out of or be
related in any way to my employment by the Company. Such disputes include, but
are not limited to, claims I might bring against the Company for wrongful
termination, discrimination, harassment, retaliation, breach of contract, wage
and hour violations, and torts such as invasion of privacy, assault and
battery, or defamation. Such disputes also include claims that the Company
might bring against me such as, for example, theft of money or trade secrets,
breach of a confidentiality agreement, or breach of a contract. I and the
Company each specifically waive our respective rights to bring such claims
against the other in a court of law and to have a trial by jury.
2. The only exceptions to binding arbitration
shall be for claims arising under the National Labor Relations Act which are
brought before the National Labor Relations Board, claims for medical and
disability benefits under the California Workers’ Compensation Act, claims for
benefits brought before the Employment Development Department, claims for wages
brought before the California Labor Commissioner, or other claims that are not
subject to arbitration under law. . . .
3. My agreement to
arbitrate claims against the Company includes claims I might bring against the
Company’s parent, subsidiary, affiliated or client entities as well as against
owners, directors, officers, managers, employees, agents, contractors,
attorneys, benefit plan administrators, and insurers of the Company or of its
parent, subsidiary, affiliated or client entities. I also agree to arbitrate
claims against any person or entity I allege to be a joint employer with the
Company.
(Pham Decl. Exh. A. p. 1.) On its face, the Agreement appears
to explicitly apply to Plaintiff’s wage and hour and employment claims. In
opposition, Plaintiff contends that Defendants have not adequately established
that the Agreement applies to Micro Connection and PCPG. The Court disagrees.
Defendants have provided statements by the CEOs of ESG and Micro Connection
stating that ESG was engaged by Micro Connection and PCPG to provide PEO
services. (Declaration of Robert Compani ISO Mot. ¶ 3; Declaration of Sally
Villalobos ISO Mot. ¶ 3.) Further, the Villalobos declaration states that PCPG
is a fictitious name for Micro Connection, and that the two are the same
entity. (Id. ¶ 2.) These statements, provided under penalty of perjury
by individuals whose position as CEO provides a foundation for their knowledge,
are sufficient to establish that Micro Connection and PCPG are clients of ESG,
and therefore that they are explicitly covered by the terms of the Agreement.
Defendants also
contend that this agreement applies to Plaintiff’s PAGA claims, and, therefore,
that Plaintiff’s individual PAGA claims should be compelled to arbitration and
his representative claims dismissed. Section 4 of the Agreement states:
I and the Company agree that any claims
we might pursue against the other in arbitration under this agreement shall be
brought in the individual capacity of myself or the Company. This agreement
shall not be construed to allow or permit the consolidation or joinder of
claims of other claimants, or to permit such claims to proceed as a class or
collective action. No arbitrator shall have the authority under this agreement
to order any such class or collective action. Any dispute regarding the
validity, scope or enforceability of this agreement, or concerning the
arbitrability of a particular claim, shall be resolved by a court, not by the
arbitrator. I agree to waive any substantive or procedural rights that I may
have to bring or participate in an action brought on a class or collective
basis. If under applicable law a representative claim under the California Private
Attorneys General Act ("'PAGA'') is found to be unwaivable and such an
action is pursued in court, I and the Company agree that any such PAGA claim
will be severed and stayed pending resolution of claims that are arbitrable.
(Pham Decl. Exh. A. p.1.)
The Court agrees with Defendant that Plaintiff’s individual PAGA claim
falls within the broad scope of the arbitration agreement in that it constitutes
a dispute that arises out of and is related to Plaintiff’s employment with
Defendant.
Motion to Compel Individual PAGA Claim to Arbitration and
Dismiss Representative Claims
Defendants contend that, in light
of the United States Supreme Court’s holding in Viking River Cruises v.
Moriana, (2022) 142 S. Ct. 1906 (“Moriana”), all of Plaintiff’s
claims, including the individual PAGA claim, should be compelled to arbitration,
and the representative claims under PAGA dismissed. The Court must first
address the threshold question of the effect of Moriana on Plaintiff’s
PAGA claim.
The California Supreme Court held
in its landmark decision in Iskanian v. CLS Transportation Los Angeles, LLC
(2014) 58 Cal.4th 380 (“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 answers
to the first two question are clear from the language of the arbitration
agreement. The arbitration clause limits
Plaintiff’s ability to pursue claims against Defendant to those brought in his
individual capacity, disallows any consolidation or joinder of the claims of
other claimants with Plaintiff’s claims, and bars Plaintiff from bringing or
participating in any class or collective actions. Thus, the parties’ arbitration provision
effectuates an unlawful “wholesale waiver of representative PAGA claims that is
unenforceable under Iskanian and Moriana. That said, the severance clause in the
arbitration agreement clearly authorizes the Court to sever this unenforceable
provision and stay the PAGA claims that are not considered arbitrable under the
parties’ agreement. The relevant
language provides: “If under applicable law a representative claim under the
California Private Attorneys General Act ("'PAGA'') is found to be
unwaivable and such an action is pursued in court, I and the Company agree that
any such PAGA claim will be severed and stayed pending resolution of claims
that are arbitrable.” (Pham Decl. Exh.
A. p.1.) The parties agreed, therefore,
that where, as here, the law bars a complete waiver of representative PAGA
claims, those claims will be severed and stayed pending the arbitration of the
remaining claims. Applying the terms of
the parties’ agreement, the Court concludes that Plaintiff’s individual PAGA
claim may be compelled to arbitration, but that his representative PAGA claims
should be stayed pending completion of the arbitration proceedings.
Despite the terms of the parties’
agreement, Defendant relies on Moriana to urge the Court to dismiss the
representative PAGA claims. In Moriana,
the U.S. Supreme Court ruled that the resolution of Plaintiff’s individual
PAGA claim in arbitration would extinguish his standing to act as a
representative for other aggrieved parties in a later court proceeding. As is explained below, however, this Court
disagrees with the U.S. Supreme Court’s assessment of California standing law
under PAGA.
Defendant
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. 5th 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. As a result, he satisfies
the definition of an aggrieved employee with standing to pursue PAGA penalties
on behalf of the state, even if his individual claims are resolved against him
in arbitration. (Kim, supra, at pp. 83-84; Johnson v. Maxim Healthcare
Servs., Inc. (2021) 66 Cal. App. 5th 924, 930 [relying on Kim to
hold: “The fact that [Plaintiff’s] individual claim may be time-barred does not
nullify the alleged Labor Code violations nor strip [Plaintiff] of her standing
to pursue PAGA remedies.”]; see also 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 representative PAGA claims be dismissed for lack of standing
and instead concludes that a stay of prosecution is the proper course of
action.
Although
neither party raises this issue, the Court notes that the California Supreme
Court granted review on July 20, 2022 in Adolph v. Uber Technologies, S274671,
to address whether an aggrieved employee maintains standing to pursue
non-individual PAGA claims once an individual PAGA claim has been committed to
a separate proceeding. As the case was fully briefed as of November 8, 2022,
the Court anticipates that our Supreme Court will soon issue its opinion on
this issue. Therefore, the Court will stay the prosecution of Plaintiff’s
representative PAGA claims pending the resolution of the arbitration, unless the
issue of standing is resolved by Adolph in a way that renders stay of
this action improper.
Unconscionability
Plaintiff
also opposes Defendants’ motion to compel arbitration in its entirety on the
basis that the agreement is unenforceable because it is unconscionable.
1. Procedural Unconscionability
“‘To
briefly recapitulate the principles of unconscionability, the doctrine has
“‘both a “procedural” and a “substantive” element,’ the former focusing on
‘“oppression”’ or ‘“surprise”’ due to unequal bargaining ¿power, the latter on ‘“overly harsh”’ … or ‘“one-sided”’
results.” [Citation.] The procedural element of an unconscionable contract
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.’” … [¶] Substantively unconscionable terms may take various forms, but may generally be described as unfairly one-sided.’
[Citation.]” (Citation omitted.)
“Under this approach, both the procedural
and substantive elements must be met before a contract or term will be deemed
unconscionable. Both, however, need not be present to the same degree. A
sliding scale is applied so that ‘the 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.’
(Citations omitted.)
(Walnut Producers of California v. Diamond Foods, Inc. (2010) 187 Cal.App.4th 634, 645
(bold emphasis added).)
Plaintiff argues that the agreements
are procedurally unconscionable because they are contracts of adhesion. This
argument presents only a minimal amount of unconscionability:
“The
procedural element of the unconscionability analysis concerns the manner in which
the contract was negotiated and the circumstances of the parties at that time.
[Citation.] The element focuses on oppression or surprise. [Citation.]
‘Oppression arises from an inequality of bargaining power that results in no
real negotiation and an absence of meaningful choice.’ [Citation.] Surprise is
defined as ‘“the extent to which the supposedly agreed-upon terms of the
bargain are hidden in the prolix printed form drafted by the party seeking to
enforce the disputed terms.”’ [Citation.]” (Citation omitted.)
Plaintiffs claim the Agreement is procedurally
unconscionable because it is an adhesion contract. An adhesion contract is “a
standardized contract … imposed upon the subscribing party without an opportunity
to negotiate the terms.” (Citation omitted.) “The term signifies a standardized
contract, 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. [Citation.]” (Citation omitted.)
The California Supreme Court has consistently
stated that “‘[t]he procedural element of an unconscionable contract generally
takes the form of a contract of adhesion … .’ ”
(Citations omitted.)
“Whether the challenged provision is within a
contract of adhesion pertains to the oppression aspect of procedural
unconscionability. A contract of adhesion is “imposed and drafted by the party
of superior bargaining strength” and “relegates to the subscribing party only
the opportunity to adhere to the contract or reject it.” (Citations omitted.) “[A]bsent unusual
circumstances, use of a contract of adhesion establishes a minimal degree of
procedural unconscionability notwithstanding the availability of market
alternatives.” (Citation omitted.)
(Walnut Producers of California, supra, 187
Cal.App.4th at 645-46 [bold emphasis added].) Thus, even accepting Plaintiff’s
argument as true, this would establish only a minimum of procedural
unconscionability. Defendants do not dispute that the agreements are contracts
of adhesion because they were presented as part of the required employment
documents.
Plaintiff
also contends that the agreement is procedurally unconscionable because the
agreement did not explain the disadvantages of arbitration. Plaintiff’s
argument relies on a misapprehension of Gentry v. Superior Court (2007) 42
Cal.4th 443. In that case, our Supreme Court found that an arbitration
agreement had some element of procedural unconscionability where an “Associate
Issue Resolution Handbook” provided with the agreement described the advantages
of electing arbitration, but did not discuss, in detail, the shortcomings of
the particular arbitration agreement at issue relative to litigation. (Gentry,
supra, 42 Cal.4th at 470-72.) The Gentry court did not hold that any
arbitration agreement must provide an explanation of the advantages or
disadvantages of arbitration. Instead, it found, on the facts presented, that
there was an unfairly imbalanced portrayal of arbitration that rendered
the agreement procedurally unconscionable. Here, there is no such showing.
Thus,
Plaintiff has established only a minimal degree of procedural unconscionability
on the basis that the contract was a contract of adhesion.
2. Substantive Unconscionability
Plaintiff argues that the agreement
is substantively unconscionable. As Plaintiff has shown a minimal degree of
procedural unconscionability, Plaintiff must establish an extreme level of
substantive unconscionability.
“A
provision is substantively unconscionable if it ‘involves contract terms that
are so one-sided as to “shock the conscience,” or that impose harsh or
oppressive terms.’ [Citation.] The phrases ‘harsh,’ ‘oppressive,’ and ‘shock
the conscience’ are not synonymous with ‘unreasonable.’ Basing an
unconscionability determination on the reasonableness of a contract provision
would inject an inappropriate level of judicial subjectivity into the analysis.
¿‘With a concept as nebulous as “unconscionability” it is important that courts
not be thrust in the paternalistic role of intervening to change contractual
terms that the parties have agreed to merely because the court believes the
terms are unreasonable. The terms must shock the conscience.’
[Citations.]”
(Walnut
Producers of California v. Diamond Foods, Inc. supra, 187 Cal.App.4th at 647-48.)
Plaintiff contends
that the agreement is substantively unconscionable because it fails to provide
for a neutral arbitrator, fails to provide for all types of relief otherwise
available in court, and does not provide for adequate discovery. Plaintiff
cites no law in support of these claims, nor does Plaintiff provide any
explanation for these conclusory, one-sentence assertions. Further, a cursory
review of the agreement explicitly refutes all of Plaintiff’s assertions. (Pham
Decl. Exh. A. §§ 6-7.) Plaintiff has therefore failed to demonstrate that the
agreement is substantively unconscionable in any respect. Thus, even if the
agreement is, in some respect, procedurally unconscionable, Plaintiff has not
demonstrated that it should not be enforced on the basis of unconscionability.
CONCLUSION:
Accordingly,
Defendants’ motion to compel Plaintiff’s individual claims,
including Plaintiff’s individual PAGA claims to binding arbitration is GRANTED
Plaintiff’s
representative PAGA claims are ordered STAYED pending resolution of the
arbitration, unless and until a contrary result is required by the California
Supreme Court in its ruling in the pending case of Adolph v. Uber
Technologies, S274671.
All
hearings on this matter are placed off-calendar.
The Court
sets a hearing on the status of Adolph v. Uber Technologies and of the
arbitration as a whole for August 22, 2023, at 9:00 AM.
Moving
Parties to give notice.
IT IS SO ORDERED.
Dated: February 22, 2023 ___________________________________
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.