Judge: Theresa M. Traber, Case: 24STCV03045, Date: 2025-02-05 Tentative Ruling

Case Number: 24STCV03045    Hearing Date: February 5, 2025    Dept: 47

Tentative Ruling

 

Judge Theresa M. Traber, Department 47

 

 

HEARING DATE:     February 5, 2025                   TRIAL DATE: NOT SET

                                                          

CASE:                         Lawrence Welk Jr. v. The Welk Group, Inc. et al.

 

CASE NO.:                 24STCV03045           

 

MOTION TO COMPEL ARBITRATION

 

MOVING PARTY:               Defendants The Welk Group, Inc., Jonathan Fredricks, Kevin Welk, and Stephen Baron

 

RESPONDING PARTY(S): Plaintiff Lawrence Welk Jr.

 

CASE HISTORY:

·         02/06/24: Complaint filed.

 

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

           

            This is an action for age discrimination that was filed on February 6, 2024. Plaintiff alleges that, during his tenure as CEO of The Welk Group, the Defendants amended the corporation’s bylaws to limit the maximum age of any director of the corporation and thereafter eliminated Plaintiff’s position as CEO.

 

Defendants move to compel arbitration.

           

TENTATIVE RULING:

 

Defendants’ Motion to Compel Arbitration is DENIED.

 

DISCUSSION:

 

Defendants move to compel arbitration.

 

Plaintiff’s Opposition

 

            Plaintiff’s Opposition papers were filed with the Court on January 23, 2025, and state, via the included proof of service, that they were served on Defendants’ counsel on that date by email. (Opp. Proof of Service.) Pursuant to Code of Civil Procedure section 1005(b), which requires opposition papers to be served nine court days before the scheduled hearing, Plaintiff’s opposition was due on that date. (Code Civ. Proc. § 1005(b).) However, despite the Proof of Service, Defendants’ counsel contends that they did not receive these papers until Sunday, January 26, 2025. (Supplemental Declaration of Kenny Tran ISO Reply ¶¶ 4-7; Exh. 1.) Notwithstanding the apparent mishap in service, Defendants prepared and submitted a full reply to Plaintiff’s opposition. The Court therefore declines Defendants’ invitation to reject Plaintiff’s opposition as untimely.

 

Plaintiff’s Evidentiary Objections

 

            Plaintiff objects to portions of the Declaration of Jonathan Fredricks in support of the Motion. The Court rules on these objections as follows.

 

            Objection Nos. 1: OVERRULED. These objections go to the weight of the testimony, not admissibility.

 

            Objection Nos. 2: SUSTAINED IN PART, as lacking foundation for any period before November 2022, when the declarant became President of TWGI. 

 

            Objection No. 3: SUSTAINED as lacking foundation and an improper opinion. (Evid. Code §§ 403; 800.)

 

            Objection No. 4: OVERRULED. This objection goes to the weight of the evidence, but the existence of Plaintiff’s introductory message is relevant to this issue.

 

            Objection No. 5: SUSTAINED as lacking foundation and an improper opinion. (Evid. Code §§ 403; 800.)

 

            Objection No. 6-10: SUSTAINED, as lacking foundation for any period before November 2022, when the declarant became President of TWGI. 

 

            Objection No. 11-12: SUSTAINED,  as lacking foundation. (Evid. Code § 403.)

 

Request for Judicial Notice

 

            Plaintiff requests that the Court take judicial notice of the Articles of Incorporation for Welk Music Group, Inc., filed with the California Secretary of State on January 1, 2006. Plaintiff’s request is GRANTED pursuant to Evidence Code section 452(c) (official acts).

 

Existence of an 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.)

 

As to the burden of production, rather than persuasion, courts have articulated a three-step burden shifting process:

 

First, the moving party bears the burden of producing “prima facie evidence of a written agreement to arbitrate the controversy.” [citation] The moving party “can meet its initial burden by attaching to the [motion or] petition a copy of the arbitration agreement purporting to bear the [opposing party’s] signature.” [citation] Alternatively, the moving party can meet its burden by setting forth the agreement’s provisions in the motion. [citations] For this step, “it is not necessary to follow the normal procedures of document authentication.” [citation] If the moving party meets its initial prima facie burden and the opposing party does not dispute the existence of the arbitration agreement, then nothing more is required for the moving party to meet its burden of persuasion.

 

If the moving party meets its initial prima facie burden and the opposing party disputes the agreement, then in the second step, the opposing party bears the burden of producing evidence to challenge the authenticity of the agreement. [citation] The opposing party can do this in several ways. For example, the opposing party may testify under oath or declare under penalty of perjury that the party never saw or does not remember seeing the agreement, or that the party never signed or does not remember signing the agreement. [citations]

 

If the opposing party meets its burden of producing evidence, then in the third step, the moving party must establish with admissible evidence a valid arbitration agreement between the parties. The burden of proving the agreement by a preponderance of the evidence remains with the moving party. [citation].

 

(Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 165-66.)

 

Defendants’ motion is principally based upon the Declaration of Defendant Fredricks, who states that he has been employed by The Welk Group in various capacities “for over 21 years” as of July 2024. (Declaration of Jonathan Fredricks ISO Mot. ¶ 3.) Defendant Fredricks states that, through his role as a senior executive of the corporation, he has access to the corporation’s records, which include an “Acknowledgement of Receipt,” stamped with a “received” date of March 2, 1995, and bearing Plaintiff’s signature from February 27 of that same year. (Fredricks Decl. Exh. A.) The Acknowledgment states that the signatory has received his copy of “the Company’s employee handbook dated March 1, 1994” and acknowledges that “[t]he fact that the Company voluntarily agrees to arbitrate employment related claims shall not be deemed to in any way undermine the parties’ at-will relationship. The Arbitrator shall have no authority to alter the parties’ at-will relationship and must enforce the provision of the Employee Handbook and Company policies.” (Id.) The Acknowledgment does not itself contain the terms of the arbitration agreement which it references. Instead, to demonstrate the terms, Defendants offer a 2005 employee handbook for Welk Music Group—not The Welk Group, Inc.—which includes an introductory letter from Plaintiff and contains an arbitration provision which itself references an “ADR policy.” (Fredricks Decl. Exh. B.) Defendants also do not provide either a 1994 or 2005 ADR policy, but rather have produced a 2012 ADR policy, also for the Welk Music Group. (Id. Exh. C.) Defendant Fredricks states that Plaintiff, as CEO, was aware of the arbitration provision and, in that capacity, chose to require employees to arbitrate claims. (Fredricks Decl. ¶ 15.) Defendant Fredricks also states that Plaintiff was personally responsible for approving the employee handbook. (Id. ¶ 14.)

 

Plaintiff vehemently opposes Defendants’ motion, arguing—with some force—that neither the 2005 handbook nor the 2012 ADR policy are competent evidence because both documents pertain to Welk Music Group, an entity formed in January 2006 (RJN Exh. 1) and not The Welk Group, Inc. Moreover, as Plaintiff correctly states, Defendant Fredricks’s conclusions that the 2005 Handbook is “substantially similar” to the 1994 handbook, and the 2012 ADR Policy is “substantially similar” to the 2005 Policy are just that: bare, inadmissible conclusions unsupported by evidence. Similarly, Defendant Fredricks’s conclusion that Plaintiff received the 2012 ADR Policy is equally unsupported, inadmissible and unpersuasive, and, at any rate, does not appear to pertain to Plaintiff’s own employment with a separate entity.

 

In response, Defendant entirely fails to reckon with Plaintiff’s attacks on the sufficiency of the evidence presented, instead asserting that, as CEO of The Welk Group, Plaintiff personally elected to require arbitration for all employees. This contention misses the point of Plaintiff’s challenges to the evidence. Certainly, the undisputed evidence establishes that Plaintiff assented to an arbitration agreement in some form in February 1995. But Defendants have failed to furnish the Court with the terms of the particular agreement to which Plaintiff assented as an employee of The Welk Group, Inc. Defendants’ alternative argument that Plaintiff is a third-party beneficiary of this agreement is precisely backwards: while a non-signatory third party who benefits from a contract may enforce the terms of the contract against a signatory (Cohen v. TNP 2008 Participating Notes Program, LLC (2019) 31 Cal. App. 5th 840, 856), Defendants cite no authority—and the Court is aware of none—which permits a contracting party to enforce a contract against a non-party. In fact, such a conclusion would entirely upend the basic principle that a party must assent to the terms of a contract to be bound by the obligations in that contract. The Court declines to embrace that outcome.

 

Defendants have failed to set forth the terms of the arbitration agreement to which Plaintiff assented. Defendants have therefore failed to carry their burden of production on this motion and consequently not entitled to compel arbitration.

 

CONCLUSION:

 

Accordingly, Defendants’ Motion to Compel Arbitration is DENIED.

 

Moving Parties to give notice.

 

IT IS SO ORDERED.

 

Dated:  February 5, 2025                                ___________________________________

                                                                                    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.