Judge: Theresa M. Traber, Case: 24STCV23833, Date: 2025-03-21 Tentative Ruling

Case Number: 24STCV23833    Hearing Date: March 21, 2025    Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE:     March 21, 2025                      TRIAL DATE: NOT SET

CASE:                         Francisco Alvarez, et al. v. West Covina Auto Retail, Inc., d/b/a Norm Reeves Honda Superstore West Covina

CASE NO.:                 24STCV23833           

MOTION TO COMPEL ARBITRATION

MOVING PARTY:               Defendant West Covina Auto Retail, Inc., d/b/a Norm Reeves Honda Superstore West Covina.

RESPONDING PARTY(S): Plaintiffs Francisco Alvarez and Joseph Kim

CASE HISTORY:

·         09/16/24: Complaint filed.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

            This is a wage and hour action. Plaintiffs allege that they were systematically underpaid and deprived of benefits by Defendant.

Defendant moves to compel Plaintiffs to arbitrate this dispute.

TENTATIVE RULING:

Defendant’s Motion to Compel Arbitration is GRANTED.

This action is stayed pending resolution of binding arbitration.

The Court sets a Status Conference Re: Arbitration for Monday, March 23, 2026, at 8:30 AM.

DISCUSSION:

Defendant moves to compel Plaintiffs to arbitrate this dispute.

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Plaintiffs’ Untimely Opposition

            Plaintiffs served and filed their opposition on March 11, 2025 for a hearing on March 21, 2025. Pursuant to the Code of Civil Procedure, Plaintiffs’ opposition was due nine court days before the scheduled hearing, which was March 10, 2025. (Code Civ. Proc. § 1005(b).) Plaintiffs offer no explanation for the untimely filing. However, Defendant’s substantive reply demonstrates no prejudice arising from a single day’s delay in opposing this motion. The Court therefore will consider the merits of the opposition notwithstanding its tardiness.

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.) An electronic record or signature is attributable to a person if it was the act of the person. (Civ. Code § 1633.9(a).) The act of the person may be shown in any manner. (Id.) As described by the Court of Appeal, “the burden of authenticating an electronic signature is not great.” (Ruiz v. Moss Bros. Auto Group, Inc. (2014) 232 Cal.App.4th 836, 844.)

Defendant states that, as part of Plaintiffs’ onboarding process to commence their employment, Plaintiffs electronically signed substantively identical “Arbitration Agreements” via electronic signature. (Declaration of Alma Padilla ISO Mot. ¶¶ 5-6.) Defendant has furnished the Court with copies of these agreements, one of which appears to bear Plaintiff Alvarez’s electronic signature dated September 24, 2020 (Id. Exh. 1), and one of which appears to bear Plaintiff Kim’s signature, dated September 27, 2021. (Id. Exh. 2.) Defendant authenticates these signatures via a declaration from Alma Padilla, an employee of Defendant’s human resources provider, who describes the electronic system used for signing onboarding documents, the auditing trail for each document presented, and declares that the Agreements were signed using each Plaintiff’s unique password. (Padilla Decl. ¶¶ 8-10.) Defendant has demonstrated that Plaintiffs entered into arbitration agreements with this Defendant.

Applicability of the FAA

            The Agreement expressly states that the Agreement is governed by the Federal Arbitration Act. (E.g. Padilla Decl. Exh. A. p.1.) Plaintiffs do not dispute that the Agreement is subject to the Federal Arbitration Act.

Scope of the Arbitration Agreement

             “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 Arbitration Agreements state:

Employee and Dealership agree to resolve by final and binding arbitration any dispute, claim, or controversy, including but not limited to those related to Employee’s employment with or termination of employment by Dealership, its affiliated entities, or their respective officers, directors, employees, or agents. Such disputes, claims, or controversies shall include, but not be limited to: tort claims; benefits claims; family or medical leave claims; claims of discrimination, retaliation, or harassment under federal or state law; claims of wrongful termination; claims for unpaid wages, reimbursements, meal and/or rest breaks; unfair competition, and misappropriation of trade secrets; and, any other claim that could be brought under local, state, or federal employment statutes or common law.

Excluded from arbitration are claims that, as a matter of law, cannot be resolved by arbitration, such as claims arising under the National Labor Relations Act; claims for benefits under the Workers’ Compensation Act; claims for unemployment insurance benefits; and claims seeking injunctive or declaratory relief regarding use or unauthorized disclosure of confidential information. Additionally, nothing in this Agreement shall prevent Employee from filing a complaint with the Department of Fair Employment and Housing (“DFEH”), the United States Equal Employment Opportunity Commission (“EEOC”), or any other agency that permits such filings despite an agreement to arbitrate, although any claim Employee chooses to pursue following the conclusion of a proceeding before either body will be subject to this Agreement.

(E.g. Padilla Decl. Exh. A. p. 1.) Defendant contends that this language encompasses Plaintiffs claims on their face, and Plaintiffs do not dispute that contention.

Unconscionability

            Plaintiffs’ sole challenge to the Arbitration Agreements is that they are unenforceable because they are unconscionable.

“‘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).) 

            Here, while Plaintiffs attack several provisions of the agreement as unfair or one-sided—i.e., substantively unconscionable—Plaintiffs offer neither argument nor evidence tending to establish that the Agreements are procedurally unconscionable. Plaintiffs do not attempt to demonstrate any oppression or surprise which would support such a finding. Because a finding of unconscionability requires a showing of both elements, this omission is fatal to Plaintiffs’ challenge to the Agreements.

            Defendant is therefore entitled to compel arbitration of this dispute.

CONCLUSION:

Accordingly, Defendant’s Motion to Compel Arbitration is GRANTED.

This action is stayed pending resolution of binding arbitration.

The Court sets a Status Conference Re: Arbitration for Monday, March 23, 2026, at 8:30 AM.

Moving Party to give notice.

IT IS SO ORDERED.

Dated:  March 21, 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.