Judge Upinder S. Kalra, Case Number: 23STCV29042, Date: 2024-07-02 Tentative Ruling

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MOVING PARTY: Defendant Aerotek, Inc.; Joinder by Defendants Medtronic Minimed, Inc. and Jovie Quijano (Incorrectly Sued as Juvy Quiano)

On November 28, 2023, Plaintiff Jane Doe (Plaintiff) filed a Complaint against Defendants Medtronic PLC, Aerotek, Inc., and Juvy Quiano (Defendants) with ten causes of action for: (1) FEHA Violations Based Upon Sexual Harassment, (2) FEHA Violations Based Upon Sex & Gender Discrimination, (3) FEHA Violation Based Upon Retaliation, (4) Violation of Labor Code Section 1102.5 Subdivision (c), (5) FEHA Violations for Failure to Prevent Discrimination, Harassment, & Retaliation, (6) Wrongful Termination in Violation of FEHA & Public Policy, (7) Violation of Civil Code Section 43, (8) Violation of Civil Code 52.1, (9) Sexual Battery in Violation of Cal. Civ. Code Section 1708.5, and (10) Intentional Infliction of Emotional Distress.

Plaintiff alleges that she was employed by Defendants Medtronic, Medtronic MiniMed, and Aerotek where she was subjected to sexual harassment, unwanted sexual advances, threats, bullying, and sexual assault and battery. Defendant Quijano allegedly sexually battered Plaintiff. Plaintiff alleges she was terminated for reporting this conduct as well as for reporting product quality issues.

On November 30, 2023, Plaintiff filed an Amendment to Complaint to correct the name of Defendant Juvy Quiano to Jovy Quijano.

On January 24, 2024, Plaintiff filed an Amendment to Complaint to correct the name of Defendant Medtronic PLC to Medtronic, Minimed, Inc.

On February 23, 2024, Defendant Medtronic MiniMed, Inc. (Medtronic MiniMed) filed an Answer.

On May 6, 2024, Aerotek filed the instant Motion to Compel Arbitration and Stay Action.

On May 15, 2024, Defendant Jovie Quijano, incorrectly sued as Juvy Quiano (Quijano) filed an Answer.

On May 15, 2024, Defendants Medtronic and Quijano filed a Joinder to Aerotek’s Motion to Compel Arbitration.

On May 30, 2024, Plaintiff filed an Amendment to Complaint to replace DOE 1 with Medtronic, Inc.

On May 31, 2024, the parties filed a Stipulation and Order to allow Plaintiff to file a First Amended Complaint (FAC).

On June 4, 2024, Plaintiff filed Amendments to Complaint to correct the name of Defendant Jovy Quijano to Jovie Quijano and Medtronic PLC to Medtronic MiniMed, Inc.

On June 10, 2024, Plaintiff filed the FAC against Defendants Medtronic MiniMed, Inc., Medtronic, Inc., Aerotek, Inc., and Jovie Quijano. The FAC added an eleventh cause of action for Negligent Hiring, Supervision, Retention and/or Training.

On June 18, 2024, Plaintiff filed an opposition to the Motion to Compel Arbitration. Aerotek filed a reply on June 25, 2024.

The court grants Aerotek’s request for judicial notice as to 1-32. (Evid. Code § 452(d), (h); See Kalnoki v. First American Trustee Servicing Solutions, LLC (2017) 8 Cal.App.5th 23,37.) However, the court only takes judicial notice of the foregoing documents only as to “the existence, content and authenticity of public records and other specified documents”; it does not take judicial notice of the truth of the factual matters asserted in those documents. (Dominguez v. Bonta (2022) 87 Cal. App. 5th 389, 400.)¿¿

Under California law, the trial court has authority to compel arbitration pursuant to CCP §1281.2 where a written agreement for such arbitration exists and one of the parties refuses to arbitrate.¿ Specifically, the statute provides that, “[o]n petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement arbitrate the controversy exists.”¿ The statute further sets forth four grounds upon which the trial court may refuse to compel arbitration: (a) the right to compel arbitration was waived, (b) recission of the agreement, (c) there is a pending action or special proceeding with a third party, arising out of the same transaction; and (d) petitioner is a state or federally chartered depository institution.¿

“[T]he petitioner bears the burden of proving the existence of a valid arbitration agreement by the preponderance of the evidence . . . .”¿¿(Giuliano v. Inland Empire Personnel, Inc.¿(2007) 149 Cal.App.4th 1276, 1284¿(Guiliano).)¿“In determining whether an arbitration agreement applies to a specific dispute, the court may examine only the agreement itself and the complaint filed by the party refusing arbitration [citation]. The court should attempt to give effect to the parties' intentions, in light of the usual and ordinary meaning of the contractual language and the¿circumstances under which the agreement was made.”¿¿(Weeks v. Crow¿(1980) 113 Cal.App.3d 350, 353.)¿ “To determine whether a contractual arbitration clause requires arbitration of a particular controversy, the controversy is first identified and the issue is whether that controversy is within the scope of the contractual arbitration clause.”¿¿(Titolo¿v. Cano¿(2007) 157 Cal.App.4th 310, 316.)¿ “Doubts as to whether an arbitration clause applies to a particular dispute are to be resolved in favor of sending the parties to arbitration. The court should order them to arbitrate unless it is clear that the arbitration clause cannot be interpreted to cover the dispute.”¿¿(California Correctional Peace Officers¿Ass'n¿v. State¿(2006) 142 Cal.App.4th 198, 205.)¿¿¿¿

“[A] party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense. [Citation.] In these summary proceedings, the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court's discretion, to reach a final determination.”¿¿(Giuliano, supra, at p. 1284.)¿¿

Plaintiff did not oppose the validity of the arbitration agreement and did not oppose enforcement due to procedural or substantive unconscionability. For completeness, the court nevertheless quickly addresses each.

In determining the enforceability of an arbitration agreement, the court considers “two ‘gateway issues’ of arbitrability: (1) whether there was an agreement to arbitrate between the parties, and (2) whether the agreement covered the dispute at issue.”¿ (Omar v. Ralphs Grocery Co. (2004) 118 Cal.App.4th 955, 961 (Omar).)¿

The moving party can meet its initial burden of proving the existence of an arbitration agreement by attaching a copy of the Agreement to this motion bearing the signature of the opposing party. (See Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541, 541-543 [“The party seeking arbitration can meet its initial burden by attaching to the petition a copy of the arbitration agreement purporting to bear the¿respondent's signature.”].) Alternatively, the moving party can meet its initial burden by setting forth the agreement’s provisions in the motion. (See Cal. Rules of Court, rule 3.1330; see also Condee v. Longwood Management Corp. (2001) 88 Cal.App.4th 215, 219.)

Here, Defendants established an Agreement exists by attaching a copy of it to the instant motion. (Declaration of Lindsey Collum (Collum Decl.) ¶ 20, Exhibits 4 & 24.) Defendants also provide evidence that Plaintiff electronically signed the Agreement. (Collum Decl. ¶¶ 18-20.)

“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.” (Gamboa v. Northeast Community Clinic (2021) 72 Cal. App. 5th 158,165 (Gamboa).) The evidence must be sufficient to create a factual dispute to shift the burden back to the arbitration proponent who retains the ultimate burden of proving, by a preponderance of the evidence, the authenticity of the signature. (Iyere v. Wise Auto Group (2023) 87 Cal.App.5th 747, 755 (Iyere).)¿

Defendants contend that Plaintiff’s FAC is subject to arbitration because the dispute arose before the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act’s (EFAA) enactment and is otherwise covered by the Agreement.[1] Plaintiff argues that there was no dispute until she filed her FEHA complaint which occurred after EFAA’s enactment. Thus, the issue is not whether the Agreement covers the subject dispute but whether enforcing it is prohibited under EFAA.

The term “sexual harassment dispute” means a dispute relating to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State Law. (9 U.S.C.A. § 401(d).) “[A]t the election of the person alleging conduct constituting a sexual harassment dispute . . . no predispute arbitration agreement . . . shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the . . . sexual harassment dispute.” (Id. at § 402(a).) (italics added.) “An issue as to whether this chapter applies with respect to a dispute shall be determined under Federal Law.” (Id. at subd. (b).) Until further guidance from the courts of appeal, this court interprets this statute to involve any claims related to the sexual assault or sexual harassment dispute.

“For a dispute to arise, a party must first assert a right, claim, or demand.” (Kader v. Southern California Medical Center, Inc. (2024) 99 Cal.App.5th 214, 218 (Kader).) While “the date that a dispute [arose] is a fact-specific inquiry in each case . . . a dispute does not arise solely from the alleged sexual conduct” but “arises when one party asserts a right, claim, or demand, and the other side expresses disagreement or takes an adversarial posture.” (Id. at p. 222.) “Until there is a conflict or a disagreement, there is nothing to resolve in litigation.” (Id. at p. 223.)

In Kader, the Court of Appeals affirmed an order denying a motion to compel arbitration. There, the plaintiff did not complain or tell anyone about the alleged sexual misconduct until he filed charges with the DFEH in May 2022 – after the enactment of EFAA. (Kader, supra, at p. 224.) The Court found there was no evidence that the defendants “disagreed with any claim asserted by [the plaintiff] until after he filed charges with the DFEH.” (Ibid.) Here, unlike in Kader, there is evidence of a disagreement because Plaintiff complained on at least two separate occasions to Aerotek or Medtronic and they in turn acted adversely to those complaints. (FAC ¶¶ 29 [“Plaintiff’s complaints were, however, ignored and no corrective action was taken with regards to said unwanted sexual harassment and bullying.”] 32-33, [“Plaintiff participated in a meeting with Aerotek . . . regarding the harassment and bullying . . . During the meeting, . . . [various named individuals] yell[ed], and act[ed] aggressively towards Plaintiff. Said individuals pointed their fingers at Plaintiffs and threatened her to stop reporting them to management . . . Plaintiff was not given a chance to explain her side and the sexual harassment, bullying and hostile work environment continued.”] 36, [“Mr. Schredle declined to accept the notes and told Plaintiff to ‘settle it outside.’”] 37, [“Plaintiff complained to Medtronic Human Resources . . . [who] refused to accept Plaintiff’s complaint letters and told her . . . he would not address Plaintiff’s concerns and complaints. Plaintiff pleaded with Mr. Short to address her concerns and take corrective actions . . . but Mr. Short refused . . . .”] 38-39, [Plaintiff’s contract was not renewed after the continued to complain about the hostile work environment] 43 [Plaintiff complained about continued harassment and those complaints were ignored and Defendants “did not take any corrective action.”] 49-51 [Plaintiff reported sexual assault to her supervisors and was terminated.]) It is clear from these excerpts that there was a dispute before EFAA’s enactment. First, Plaintiff alleges that Mr. Short of Medtronic “refused” to handle her complaints even though she “pleaded” with him to do so. Second, failing to renew her employment contract and terminating her is clearly an “adversarial response” to Plaintiff’s complaints of sexual harassment and sexual abuse.[2] As all of these events occurred on or before November 21, 2020, the dispute arose before EFAA’s enactment.

In Armendariz, the California Supreme Court stated that when determining whether an arbitration agreement was unconscionable, there is both a procedural and a substantive element. (Armendariz v. Foundation Health Psychcare Service, Inc. (2000) 24 Cal.4th 82, 114 (Armendariz)).¿¿While Plaintiff does not argue that the Agreement is unconscionable, the court nevertheless briefly addresses procedural and substantive unconscionability.

Courts determine whether an agreement is procedurally unconscionable by looking at surprise and oppression. Oppression is an “inequality of bargaining power, when one party has no real power to negotiate or a meaningful choice. Surprise occurs when the allegedly unconscionable provision is hidden.” (Carmona v. Lincoln Millennium Car Wash, Inc.¿(2014) 226 Cal.App.4th 74, 84 (Carmona).) Examples of contracts that are procedurally unconscionable are contracts of adhesion, which is 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.” (Armendariz, supra, at p. 113). “The circumstances relevant to establishing oppression include, but are not limited to (1) the amount of time the party is given to consider the proposed contract; (2) the amount and type of pressure exerted on the party to sign the proposed contract; (3) the length of the proposed contract and the length and complexity of the challenged provision; (4) the education and experience of the party; and (5) whether the party’s review of the proposed contract was aided by an attorney. (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 126-27 (OTO).)

Here, there is minimal, if any, procedural unconscionability. “When arbitration is a condition of employment, there is inherently economic pressure on the employee to accept arbitration. This alone is a fairly low level of procedural unconscionability.” (Cisneros Alvarez v. Altamed Health Services Corporation (2021) 60 Cal.App.5th 572, 591). Plaintiff could had refused to sign the Agreement without affecting her employment status. (Collum Decl. ¶¶ 14, 17.) Plaintiff was not rushed to complete the Agreement. (Collum Decl. ¶ 9.)

“Substantive unconscionability pertains to the fairness of an agreement's actual terms and to assessments of whether they are overly harsh or one-sided.” (Carmona, supra, at p. 85). There are five minimum substantive requirements to an enforceable arbitration agreement: (1) neutral arbitrators, (2) more than minimal discovery, (3) written award sufficient for judicial review, (4) all types of relief otherwise available in court, and (5) no unreasonable costs or fees as a condition of access. (Armendariz, supra, at p.102.) When there is little procedural unconscionability, a party opposing arbitration must show substantial substantive unconscionability. (Id. at 114.)

Here, there is minimal substantive unconscionability, if any. First, the Agreement calls for a “single Arbitrator in California” rather than a “neutral” Arbitrator. However, the JAMS employment arbitration rules and procedures that are incorporated into the Agreement provide for the appointment of a neutral arbitrator. (JAMS Employment Arbitration Rules, Rule 7 [providing for a neutral Arbitrator] and Rule 15 [providing for a strike list of Arbitrator candidates.]) Second, the Agreement, by incorporating the JAMS Rules, provides for more than minimal discovery. (JAMS Employment Arbitration Rules, Rule 17.) Third, the Agreement calls for a “final and binding written award, subject to review on the grounds set forth in the FAA.” (Collum Decl., Exhibits 4, 24.) Fourth, the Agreement allows claims “subject to the same affirmative rights to individual damages and other relief and the same limitations regarding damages and ability to obtain other relief as would have applied in a judicial forum.” (Ibid.) And finally, the Plaintiff’s costs are akin to those she would expect by proceeding in a judicial forum – initial filing fee and her own attorney’s fees. (Ibid.)

Therefore, the Agreement is enforceable and the Motion to Compel Arbitration is GRANTED.

[1] The Agreement covers “all disputes, claims, complaints, or controversies . . . against Aerotek, Inc and/or any of its subsidiaries, affiliates, officers, directors, employees, agents, and/or any of its clients or customers . . . including . . . discrimination and/or harassment claims; retaliation claims; . . . and any other claim under any federal, state, or local statute, constitution, regulation, rule, ordinance, or common law, arising out of and/or directly or indirectly related to my application for employment with the Company, and/or my employment with the Company, and/or the terms and conditions of my employment with the Company, and/or termination of my employment with the Company . . . .” (Collum Decl., Exhibits 4, 24.)

[2] Failing to take action to address her complaints is also, arguably, an adversarial posture.

[3] Defendant’s argument concerning affirmative defenses is well taken. The court declines to further address it at this time.