1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 SARAH BRACAMONTES, No. 2:23-cv-02697-DAD-CSK 12 Plaintiff, 13 v. ORDER GRANTING DEFENDANT’S MOTION TO COMPEL ARBITRATION AND 14 UNITED RENTALS, INC., STAYING THE PROCEEDINGS PENDING ARBITRATION 15 Defendant. (Doc. No. 12) 16
17 18 This matter is before the court on defendant’s motion to compel arbitration. (Doc. No. 19 12.) On February 2, 2024, the pending motion was taken under submission on the papers 20 pursuant to Local Rule 230(g). (Doc. No. 14.) For the reasons explained below, the court will 21 grant defendant’s motion to compel arbitration. 22 BACKGROUND 23 On October 11, 2023, plaintiff Sarah Bracamontes initiated a discrimination action against 24 her employer defendant United Rentals, Inc. in the San Joaquin County Superior Court. (Doc. 25 Nos. 1 at 1; 1-1 at 2–3.) On November 17, 2023, defendant removed the action to this court 26 pursuant to 28 U.S.C. § 1441. (Doc. No. 1.) In her operative complaint, plaintiff asserts 27 individual claims under California Government Code §§ 12940, et seq. for gender discrimination, 28 retaliation, failure to take all reasonable and necessary steps to prevent and correct discrimination 1 and retaliation, and wrongful termination. (Doc. No. 1-1 at ¶¶ 44–70.) Plaintiff also brings an 2 individual claim for intentional infliction of emotional distress. (Id. at ¶¶ 113–19.) In addition, 3 plaintiff asserts claims under the California Labor Code and the applicable wage orders and 4 alleges that defendant failed to provide required meal periods, rest periods, and accurate and 5 complete wage statements. (Id. at ¶¶ 71–112.) She brings these latter three claims on behalf of 6 herself and other allegedly aggrieved employees under California Labor Code §§ 2698, et seq., 7 the Private Attorneys General Act (“PAGA”). 8 On February 13, 2024, defendant filed the pending motion to compel arbitration, 9 contending that plaintiff signed two arbitration agreements. (Doc. No. 12.) Defendant alleges 10 that first, while applying for a position with United Rentals, plaintiff signed an agreement stating 11 that both parties were “mutually required to arbitrate any and all disputes, claims, or controversies 12 . . . against the other that could be brought in a court.” (Id. at 8.) In support of this contention, 13 defendant attached a declaration from Malcolm March, the human resources director of the West 14 division of United Rentals, Inc. (Doc. No. 12-3.) March attested that he reviewed the human 15 resources records for the United Rentals location at which plaintiff worked and confirmed that 16 she signed her first arbitration agreement with defendant on August 30, 2017 as part of the 17 application process. (Id. at ¶ 5.) Defendant also attached that agreement bearing plaintiff’s 18 electronic signature. (Doc. No. 12-4 at 6.) Moreover, defendant contends that once hired, 19 plaintiff again agreed to arbitrate “any and all disputes, claims, or controversies” arising from her 20 employment with defendant by electronically signing an employment agreement that contained an 21 arbitration provision.1 (Doc. No. 12 at 8; 12-4 at 5.) March attested to the existence of this 22 agreement as well, confirming that a review of defendant’s records shows that plaintiff signed the 23 second agreement on September 9, 2017, as part of the onboarding process. (Doc. No. 12-3 at 24 ¶ 5.) Defendant has also submitted a copy of this agreement bearing plaintiff’s electronic 25 ///// 26 1 The court notes that defendant refers to the arbitration provision within the employment 27 agreement as the “Arbitration Agreement” and brings its motion to compel arbitration only as to this agreement, and not the first agreement signed during the job application process. The court 28 will adopt this naming convention in the discussion section of this order below. 1 signature. (Doc. No. 12-5 at 7.) Lastly, defendant has filed a request for judicial notice in 2 support of its motion. (Doc. No. 13.)2 3 On February 28, 2024, plaintiff filed her opposition to defendant’s motion, arguing only 4 that she never agreed to arbitrate, that defendant waived its right to compel arbitration through its 5 delay, and that her PAGA claims are not subject to arbitration. (Doc. No. 15 at 3–7.) The next 6 day, plaintiff filed an amended version of her opposition with minor changes. (Doc. No. 16.)3 In 7 support of her opposition, plaintiff attached her own declaration in which she states that there was 8 no arbitration agreement displayed for review and electronic signature during her onboarding 9 process. (Doc. No 16-1 at ¶ 4.) Plaintiff declares that she never signed such an agreement, that 10 she would have remembered if she did, and that she believes her signature was forged. (Id. at ¶¶ 11 4–7.) 12 On March 8, 2024, defendant filed its reply. (Doc. No. 17.) Attached thereto was another 13 declaration from human resources director March. (Doc. No. 17-1.) In it, March details the steps 14 a job applicant would have been required to complete in order to submit an employment 15 application with defendant and to complete the onboarding process once offered a position. (Id. 16 at ¶ 3.) He describes that an applicant would first have to make an account using their own email 17 address and by creating a unique password. (Id. at ¶ 4.) These credentials would need to be 18 entered each time to access the account. (Id.) The password would not have been shared with 19 defendant and would only be known to the applicant. (Id.) Next, an applicant was required to 20 complete the employment application. (Id. at ¶ 5.) An arbitration agreement would have 21 appeared on one of the final screens presented to the applicant, and the applicant would have had 22 to click through it to proceed to the final step. (Id.) The last screen would have stated “I accept 23 2 Defendant asks the court to take judicial notice of four unpublished California appellate court 24 opinions. (Doc. No. 13 at 2.) Defendant cites each of the four cases in its pending motion. (Doc. No. 12 at 20.) The court declines to take judicial notice of the orders in these cases. See Phillips 25 v. Nat’l City Bank of Ind. First Franklin Div., 462 F. App’x 666, at *1 n.1 (9th Cir. 2011) (“Judicial notice is not required for the court to consider the cited opinions as matters of law and 26 potentially persuasive precedents.”).
27 3 Defendant urges the court to disregard plaintiff’s late-filed opposition and consider the pending motion unopposed. (Doc. No. 17 at 6.) The court declines to exercise its discretion to do so and 28 will consider plaintiff’s arguments presented in her amended opposition. 1 the terms and conditions above” and given the applicant instructions to insert an electronic 2 signature. (Id.) Only after completion of these steps would the employment application have 3 been submitted to defendant. (Id.) 4 If an applicant later received a job offer, March attests that the applicant would receive an 5 email (at the address used in creating their account) requesting that the candidate log into their 6 account and sign their offer letter and employment agreement. (Id. at ¶ 6.) The employment 7 agreement contains an arbitration agreement and instructions on how to opt out of arbitration. 8 (Id.) The last screen of the employment agreement would prompt the applicant to agree to the 9 terms before proceeding with the remaining onboarding steps. (Id. at ¶ 7.) 10 March declares that he reviewed the audit trail of plaintiff’s account, also submitted to the 11 court, and confirms that she completed the above-outlined employment application process, 12 which includes signing the first arbitration agreement, on August 30, 2017 at 10:05pm. (Id. at 13 ¶¶ 9–10; Doc. No.
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 SARAH BRACAMONTES, No. 2:23-cv-02697-DAD-CSK 12 Plaintiff, 13 v. ORDER GRANTING DEFENDANT’S MOTION TO COMPEL ARBITRATION AND 14 UNITED RENTALS, INC., STAYING THE PROCEEDINGS PENDING ARBITRATION 15 Defendant. (Doc. No. 12) 16
17 18 This matter is before the court on defendant’s motion to compel arbitration. (Doc. No. 19 12.) On February 2, 2024, the pending motion was taken under submission on the papers 20 pursuant to Local Rule 230(g). (Doc. No. 14.) For the reasons explained below, the court will 21 grant defendant’s motion to compel arbitration. 22 BACKGROUND 23 On October 11, 2023, plaintiff Sarah Bracamontes initiated a discrimination action against 24 her employer defendant United Rentals, Inc. in the San Joaquin County Superior Court. (Doc. 25 Nos. 1 at 1; 1-1 at 2–3.) On November 17, 2023, defendant removed the action to this court 26 pursuant to 28 U.S.C. § 1441. (Doc. No. 1.) In her operative complaint, plaintiff asserts 27 individual claims under California Government Code §§ 12940, et seq. for gender discrimination, 28 retaliation, failure to take all reasonable and necessary steps to prevent and correct discrimination 1 and retaliation, and wrongful termination. (Doc. No. 1-1 at ¶¶ 44–70.) Plaintiff also brings an 2 individual claim for intentional infliction of emotional distress. (Id. at ¶¶ 113–19.) In addition, 3 plaintiff asserts claims under the California Labor Code and the applicable wage orders and 4 alleges that defendant failed to provide required meal periods, rest periods, and accurate and 5 complete wage statements. (Id. at ¶¶ 71–112.) She brings these latter three claims on behalf of 6 herself and other allegedly aggrieved employees under California Labor Code §§ 2698, et seq., 7 the Private Attorneys General Act (“PAGA”). 8 On February 13, 2024, defendant filed the pending motion to compel arbitration, 9 contending that plaintiff signed two arbitration agreements. (Doc. No. 12.) Defendant alleges 10 that first, while applying for a position with United Rentals, plaintiff signed an agreement stating 11 that both parties were “mutually required to arbitrate any and all disputes, claims, or controversies 12 . . . against the other that could be brought in a court.” (Id. at 8.) In support of this contention, 13 defendant attached a declaration from Malcolm March, the human resources director of the West 14 division of United Rentals, Inc. (Doc. No. 12-3.) March attested that he reviewed the human 15 resources records for the United Rentals location at which plaintiff worked and confirmed that 16 she signed her first arbitration agreement with defendant on August 30, 2017 as part of the 17 application process. (Id. at ¶ 5.) Defendant also attached that agreement bearing plaintiff’s 18 electronic signature. (Doc. No. 12-4 at 6.) Moreover, defendant contends that once hired, 19 plaintiff again agreed to arbitrate “any and all disputes, claims, or controversies” arising from her 20 employment with defendant by electronically signing an employment agreement that contained an 21 arbitration provision.1 (Doc. No. 12 at 8; 12-4 at 5.) March attested to the existence of this 22 agreement as well, confirming that a review of defendant’s records shows that plaintiff signed the 23 second agreement on September 9, 2017, as part of the onboarding process. (Doc. No. 12-3 at 24 ¶ 5.) Defendant has also submitted a copy of this agreement bearing plaintiff’s electronic 25 ///// 26 1 The court notes that defendant refers to the arbitration provision within the employment 27 agreement as the “Arbitration Agreement” and brings its motion to compel arbitration only as to this agreement, and not the first agreement signed during the job application process. The court 28 will adopt this naming convention in the discussion section of this order below. 1 signature. (Doc. No. 12-5 at 7.) Lastly, defendant has filed a request for judicial notice in 2 support of its motion. (Doc. No. 13.)2 3 On February 28, 2024, plaintiff filed her opposition to defendant’s motion, arguing only 4 that she never agreed to arbitrate, that defendant waived its right to compel arbitration through its 5 delay, and that her PAGA claims are not subject to arbitration. (Doc. No. 15 at 3–7.) The next 6 day, plaintiff filed an amended version of her opposition with minor changes. (Doc. No. 16.)3 In 7 support of her opposition, plaintiff attached her own declaration in which she states that there was 8 no arbitration agreement displayed for review and electronic signature during her onboarding 9 process. (Doc. No 16-1 at ¶ 4.) Plaintiff declares that she never signed such an agreement, that 10 she would have remembered if she did, and that she believes her signature was forged. (Id. at ¶¶ 11 4–7.) 12 On March 8, 2024, defendant filed its reply. (Doc. No. 17.) Attached thereto was another 13 declaration from human resources director March. (Doc. No. 17-1.) In it, March details the steps 14 a job applicant would have been required to complete in order to submit an employment 15 application with defendant and to complete the onboarding process once offered a position. (Id. 16 at ¶ 3.) He describes that an applicant would first have to make an account using their own email 17 address and by creating a unique password. (Id. at ¶ 4.) These credentials would need to be 18 entered each time to access the account. (Id.) The password would not have been shared with 19 defendant and would only be known to the applicant. (Id.) Next, an applicant was required to 20 complete the employment application. (Id. at ¶ 5.) An arbitration agreement would have 21 appeared on one of the final screens presented to the applicant, and the applicant would have had 22 to click through it to proceed to the final step. (Id.) The last screen would have stated “I accept 23 2 Defendant asks the court to take judicial notice of four unpublished California appellate court 24 opinions. (Doc. No. 13 at 2.) Defendant cites each of the four cases in its pending motion. (Doc. No. 12 at 20.) The court declines to take judicial notice of the orders in these cases. See Phillips 25 v. Nat’l City Bank of Ind. First Franklin Div., 462 F. App’x 666, at *1 n.1 (9th Cir. 2011) (“Judicial notice is not required for the court to consider the cited opinions as matters of law and 26 potentially persuasive precedents.”).
27 3 Defendant urges the court to disregard plaintiff’s late-filed opposition and consider the pending motion unopposed. (Doc. No. 17 at 6.) The court declines to exercise its discretion to do so and 28 will consider plaintiff’s arguments presented in her amended opposition. 1 the terms and conditions above” and given the applicant instructions to insert an electronic 2 signature. (Id.) Only after completion of these steps would the employment application have 3 been submitted to defendant. (Id.) 4 If an applicant later received a job offer, March attests that the applicant would receive an 5 email (at the address used in creating their account) requesting that the candidate log into their 6 account and sign their offer letter and employment agreement. (Id. at ¶ 6.) The employment 7 agreement contains an arbitration agreement and instructions on how to opt out of arbitration. 8 (Id.) The last screen of the employment agreement would prompt the applicant to agree to the 9 terms before proceeding with the remaining onboarding steps. (Id. at ¶ 7.) 10 March declares that he reviewed the audit trail of plaintiff’s account, also submitted to the 11 court, and confirms that she completed the above-outlined employment application process, 12 which includes signing the first arbitration agreement, on August 30, 2017 at 10:05pm. (Id. at 13 ¶¶ 9–10; Doc. No. 17-2 at 3.) He attests that she logged in again and electronically signed her 14 offer letter and employment agreement containing the second arbitration agreement on 15 September 9, 2017 at 10:12 and 10:13pm. (Id.) He states that due to the secure nature of the 16 application and onboarding process, plaintiff’s signature could only have been placed on the 17 arbitration agreements using her email and unique password, which she created herself. (Doc. 18 No. 17-1 at ¶ 11.) Finally, he attests that plaintiff completed other steps of the onboarding 19 process two days later, which would not have been possible to complete via the online platform 20 without first electronically signing her employment agreement. (Id. at ¶ 10.) 21 LEGAL STANDARD 22 A written provision in any contract evidencing a transaction involving commerce to settle 23 a dispute by arbitration is subject to the Federal Arbitration Act (“FAA”). 9 U.S.C. § 2. The 24 FAA confers on the parties involved the right to obtain an order directing that arbitration proceed 25 in the manner provided for in a contract between them. 9 U.S.C. § 4. In considering a motion to 26 compel arbitration, the “court’s role under the Act . . . is limited to determining (1) whether a 27 valid agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the 28 dispute at issue.” Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 1 2000). The party seeking to compel arbitration bears the burden of proving by a preponderance 2 of the evidence the existence of an agreement to arbitrate. Ashbey v. Archstone Prop. Mgmt., 3 Inc., 785 F.3d 1320, 1323 (9th Cir. 2015); Knutson v. Sirius XM Radio Inc., 771 F.3d 559, 565 4 (9th Cir. 2014) (citing Rosenthal v. Great W. Fin. Sec. Corp., 14 Cal. 4th 394, 413 (1996)). 5 “Arbitration is a matter of contract, and the FAA requires courts to honor parties’ expectations.” 6 AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 351 (2011). However, parties may rely upon 7 generally applicable contract defenses to invalidate an agreement to arbitrate. See id. at 339. 8 There is an “emphatic federal policy in favor of arbitral dispute resolution.” Mitsubishi 9 Motors Corp. v. Soler Chrysler–Plymouth, 473 U.S. 614, 631 (1985). As such, “any doubts 10 concerning the scope of arbitrable issues should be resolved in favor of arbitration.” Id. at 626 11 (quoting Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24–25 (1983)). 12 However, the Supreme Court has clarified that “the FAA’s ‘policy favoring arbitration’ does not 13 authorize federal courts to invent special, arbitration-preferring procedural rules.” Morgan v. 14 Sundance, Inc., 596 U.S. 411, 418 (2022). 15 DISCUSSION 16 In its pending motion to compel arbitration, defendant argues that the FAA requires the 17 court to enforce the Arbitration Agreement because the parties entered into a valid, written 18 agreement, which is binding and encompasses plaintiff’s claims. (Doc. No. 12 at 12–14.) 19 Defendant also argues that the Arbitration Agreement is not unconscionable and no grounds exist 20 for its revocation. (Id. at 14–17.) Of these elements, plaintiff contests only the validity of the 21 Arbitration Agreement based on the legitimacy of her electronic signature. (Doc. No. 16 at 3–4.) 22 In addition, plaintiff argues that defendant has waived its right to compel arbitration through its 23 delay, and that her PAGA claims are not subject to arbitration. (Id. at 4–7.) 24 A. Plaintiff’s Signature 25 Plaintiff argues that she is not bound by the Arbitration Agreement because she did not 26 sign it and that her digital signature must therefore have been added later. (Doc. No. 16 at 4.) 27 Plaintiff states that she does not remember seeing or reviewing the Arbitration Agreement during 28 the onboarding process and that she would have remembered signing it. (Id.) She concludes that 1 therefore she was not a signatory, did not agree to arbitration, and cannot be compelled to 2 arbitrate her claims. (Id.) 3 A forged signature can be sufficient to invalidate an arbitration agreement. Cornejo v. 4 Spenger’s Fresh Fish Grotto, No. 09-cv-05564-MHP, 2010 WL 1980236, at *4 (N.D. Cal. 5 May 17, 2010) (citing 9 U.S.C. § 2). California Civil Code § 1633.9 provides: “An electronic 6 record or electronic signature is attributable to a person if it was the act of the person. The act of 7 the person may be shown in any manner, including a showing of the efficacy of any security 8 procedure applied to determine the person to which the electronic record or electronic signature 9 was attributable.” Cal. Civ. Code § 1633.9(a). The burden of proof as to the authenticity of an 10 electronic signature is by a preponderance of the evidence. Ruiz v. Moss Bros. Auto Grp., 232 11 Cal. App. 4th 836, 846 (2014). This is “not a difficult evidentiary burden to meet” and can be 12 met with evidence in the form of a declaration from a business manager explaining the basis upon 13 which one can infer that an electronic signature was the result of the act of a party. Id. at 844. 14 For example, such evidence could include an explanation that a signature could have only been 15 placed by a person with plaintiff’s unique login, that all employees are required to use unique 16 logins to access the relevant HR system and sign forms, and that the date and time printed next to 17 an electronic signature indicates the date and time the signature was made. Id. However, an 18 “unsupported assertion that [the plaintiff] was the person who electronically signed,” without any 19 such explanation, will not sufficiently authenticate the plaintiff’s electronic signature. Id. 20 Here, the two March declarations provide sufficient detail for the court to conclude that 21 plaintiff’s electronic signature on the Arbitration Agreement was authentic and not forged. (See 22 Doc. Nos. 12-3, 17-1.) The March reply declaration details how a job applicant would have been 23 required to create an account on the Career Center page of defendant’s website, which requires 24 entering an email address and creating a unique password. (Doc. No. 17-1 at ¶ 4.) This password 25 would not be shared with defendant and would only be known by the applicant. (Id.) The 26 arbitration agreement would have appeared on one of the final screens of the application, and the 27 last screen would have given instructions to provide an electronic signature to accept the terms 28 and conditions. (Id. at ¶ 5.) Only after signing and pressing the “accept” button would the 1 application be submitted to defendant. (Id.) Further, the March declaration details that if an 2 applicant received an offer, the applicant would also receive an email communication prompting 3 them to log back into their account using their email address and password to review and 4 electronically sign their offer letter and employment agreement. (Id. at ¶ 6.) The system would 5 not allow an applicant to proceed to the remaining onboarding steps without first executing the 6 employment agreement. (Id. at ¶ 7.) March attests that he reviewed the audit trail of plaintiff’s 7 account activity and notes the dates and times that plaintiff electronically signed the various 8 agreements. (Id. at ¶¶ 9–10.) These dates and times align with those generated by the log of 9 plaintiff’s account activity that defendant also submitted in support of its reply brief. (Doc. No. 10 17-2.) March declares that plaintiff completed the onboarding process, including later steps such 11 as signing an I-9 form, which the online platform would not have permitted her to complete 12 without first electronically signing the employment agreement. (Doc. No. 17-1 at ¶ 10.) The 13 audit trail log displays later onboarding steps including the I-9 form. (Doc. No. 17-2 at 2.) This 14 type of explanation and evidence is precisely that which the California Court of Appeal in Ruiz 15 concluded properly supported a finding that the electronic signature in question belonged to the 16 plaintiff. See Ruiz, 232 Cal. App. 4th at 844. 17 While plaintiff claims to believe that her digital signature was forged, she presents no 18 evidence to support this claim. “[I]t is not sufficient for the party opposing arbitration to utter 19 general denials of the facts on which the right to arbitration depends. . . . [T]he party opposing 20 may not rest on a denial but must submit evidentiary facts showing that there is a dispute of fact 21 to be tried.” Grabowski v. Robinson, 817 F. Supp. 2d 1159, 1168 (S.D. Cal. 2011). Plaintiff does 22 not allege, for example, that her login information was shared with others, or that she was unable 23 to access the online system during the time period that she purportedly electronically signed the 24 agreements. Plaintiff also has presented no evidence disputing her creation of an account to apply 25 for a position with defendant, and instead admits to participating in the online onboarding 26 process. (Doc. No. 16-1 at ¶ 4.) Thus, the audit of plaintiff’s account activity, the evidence of the 27 steps taken by plaintiff in the online system including placing her electronic signature and more, 28 and defendant’s explanation of the secure credentials that plaintiff was required to use in order to 1 log into the online system and place her electronic signature at issue, taken together establish by a 2 preponderance of the evidence that her electronic signature was authentic. See Warren v. Del 3 Taco Restaurants, Inc., No. 18-cv-00082-JGB-SP, 2018 WL 6167937, at *4 (C.D. Cal. Apr. 23, 4 2018) (finding that the plaintiff’s electronic signature was authentic where the defendant’s vice 5 president provided a similar explanation of an electronic system and the plaintiff presented no 6 evidence to dispute her ability to access the system or sign her onboarding documents other than a 7 general denial of doing so). Accordingly, the court finds plaintiff’s electronic signature was 8 authentic and will deny plaintiff’s challenge to the validity of the Arbitration Agreement. See 9 Nanavati v. Adecco USA, Inc., 99 F. Supp. 3d 1072, 1076 (N.D. Cal. 2015) (concluding that the 10 defendant’s declaration, which established in detail the basis for concluding that the plaintiff 11 electronically signed the agreement, easily satisfied the defendant’s “low burden to authenticate 12 [the p]laintiff’s electronic signature and establish the existence of a valid arbitration agreement” 13 where the plaintiff argued that the defendant had not met this burden but did not challenge the 14 facts set forth in the defendant’s declaration). 15 B. Defendant’s Delay 16 Next, plaintiff argues that even if the court finds the Arbitration Agreement to be valid, 17 defendant has waived its right to compel arbitration by moving to do so months after being served 18 with plaintiff’s original complaint. (Doc. No. 16 at 6.) In asserting a waiver of the right to 19 compel arbitration in this context, plaintiff must demonstrate: (1) defendant’s knowledge of an 20 existing right to compel arbitration; and (2) defendant’s intentional acts inconsistent with that 21 existing right. In re Google Assistant Priv. Litig., No. 19-cv-04286-BLF, 2024 WL 251407, at *3 22 (N.D. Cal. Jan. 23, 2024) (citing Hill v. Xerox Bus. Servs., LLC, 59 F.4th 457, 468 (9th Cir. 23 2023)). Until recently, a party seeking to establish the waiver of a right to arbitrate was also 24 required to demonstrate a third element, “prejudice to the party opposing arbitration resulting 25 from such inconsistent acts.” Britton v. Co-op Banking Grp., 916 F.2d 1405, 1412 (9th Cir. 26 1990), abrogated on other grounds by Coinbase, Inc. v. Bielski, 599 U.S. 736 (2023). Although 27 in this case plaintiff advances arguments addressing the issue of prejudice she has purportedly 28 suffered, the Supreme Court has eliminated the third element of prejudice and thereby lightened 1 plaintiff’s burden here. See Morgan, 596 U.S. at 417 (holding that, under the FAA, a court may 2 not “condition a waiver of the right to arbitrate on a showing of prejudice”). Since the Supreme 3 Court’s decision in Morgan, “the party opposing arbitration still bears the burden of showing 4 waiver, [but] the burden is no longer ‘heavy.’” Armstrong v. Michaels Stores, Inc., 59 F.4th 5 1011, 1014–15 (9th Cir. 2023) (explaining that “the burden for establishing waiver of an 6 arbitration agreement is the same as the burden for establishing waiver in any other contractual 7 context”). 8 As to the first element of waiver, defendant’s knowledge of an existing right to compel 9 arbitration, plaintiff asserts that defendant “was aware of the relevant arbitration provisions when 10 it was served with the [c]omplaint.” (Doc. No. 16 at 6.) In its reply brief, defendant does not 11 refute this assertion or in any way respond to it. (Doc. No. 17.) Instead, defendant argues that it 12 has not acted inconsistently with exercising the right to compel arbitration, as there has been no 13 undue delay on its part. (Id. at 11.) Defendant explains that in the approximately four months 14 between the filing of plaintiff’s complaint and defendant’s filing of the pending motion to compel 15 arbitration, counsel for the parties have held one telephonic conference to discuss submitting 16 plaintiff’s claims to arbitration, but the parties have not engaged in any discovery or submitted 17 any joint reports to the court. (Id. at 11–12; Doc. No. 12-1 at ¶ 3.) 18 “[A] party’s extended silence and delay in moving for arbitration may indicate a conscious 19 decision to continue to seek judicial judgment on the merits of [the] arbitrable claims, which 20 would be inconsistent with a right to arbitrate.” Martin v. Yasuda, 829 F.3d 1118, 1125 (9th Cir. 21 2016) (internal citations and quotations omitted). While a precise minimum length of delay has 22 not been specified as indicating such a conscious decision, the Ninth Circuit has indicated that 23 litigating in federal court for well over a year in combination with the filing of substantive 24 motions weighs in favor of a finding of waiver. See Hill, 59 F.4th at 476 (finding that the 25 defendant acted inconsistently with its right to compel arbitration where it filed a motion for 26 partial summary judgment as to a key issue in the case and litigated the action for nearly five 27 years); Martin, 829 F.3d at 1126 (finding the right to arbitration was waived where the defendant 28 litigated in federal court for seventeen months, filed a motion to dismiss on a key merits issue, 1 received an adverse ruling, and then moved to compel arbitration); Van Ness Townhouses v. Mar 2 Indus. Corp., 862 F.2d 754, 759 (9th Cir. 1988) (finding waiver of the right to arbitrate where 3 defendant litigated in court for two years and filed a motion to dismiss on the merits). 4 Particularly relevant here, moving to compel arbitration within a year of the filing of plaintiff’s 5 complaint, in combination with never seeking or obtaining a ruling on the merits of the action, 6 has been found by the Ninth Circuit to indicate no waiver of the right to arbitrate. Armstrong, 59 7 F.4th at 1016 (finding no waiver under these circumstances, despite the defendant’s propounding 8 of limited discovery requests). 9 In this case, defendant moved to compel arbitration well within a year of the filing of 10 plaintiff’s complaint, and its motion to compel arbitration is the first substantive motion filed in 11 this action. Accordingly, the court finds that defendant’s brief delay in filing the pending motion 12 is insufficient to establish a waiver of the right to arbitrate. See Capps v. JPMorgan Chase Bank, 13 N.A., No. 2:22-cv-00806-DAD-JDP, 2023 WL 3030990, at *7 (E.D. Cal. Apr. 21, 2023) (finding 14 that almost ten months of delay did not establish waiver where the defendant did not seek nor 15 obtain any ruling from the court on the merits of the action). 16 C. Plaintiff’s PAGA Claims 17 Defendant argues that because the Arbitration Agreement is enforceable, plaintiff must be 18 compelled to arbitrate her individual claims, including her individual PAGA claims. (Doc. No. 19 12 at 19–20.) Defendant argues that plaintiff’s non-individual PAGA claims should be stayed 20 until arbitration is completed. (Id.) In her opposition, plaintiff argues that because the PAGA 21 claims are brought on behalf of the state of California, and the state never agreed to arbitrate, the 22 PAGA claims are not subject to arbitration and should not be stayed. (Doc. No. 16 at 5.) 23 The court rejects plaintiff’s argument and will adopt defendant’s proposed course of 24 action. Plaintiff’s individual PAGA claims are subject to arbitration despite the lack of consent 25 by the state of California. See Viking River Cruises, Inc. v. Moriana, 596 U.S. 639, 662 (2022) 26 (finding that the petitioner “was entitled to enforce the agreement insofar as it mandated 27 arbitration of [the respondent’s] individual PAGA claim”). Further, the California Supreme 28 Court has instructed that trial courts may adopt the following procedure when a plaintiff files a 1 PAGA action comprised of individual and non-individual claims and the individual claims are 2 compelled to arbitration: 3 [T]he trial court may exercise its discretion to stay the non-individual claims pending the outcome of the arbitration pursuant to section 4 1281.4 of the Code of Civil Procedure. Following the arbitrator’s decision, any party may petition the court to confirm or vacate the 5 arbitration award under section 1285 of the Code of Civil Procedure. If the arbitrator determines that [the plaintiff] is an aggrieved 6 employee in the process of adjudicating his individual PAGA claim, that determination, if confirmed and reduced to a final judgment 7 (Code Civ. Proc., § 1287.4), would be binding on the court, and [the plaintiff] would continue to have standing to litigate his 8 nonindividual claims. If the arbitrator determines that [the plaintiff] is not an aggrieved employee and the court confirms that 9 determination and reduces it to a final judgment, the court would give effect to that finding, and [the plaintiff] could no longer prosecute his 10 non-individual claims due to lack of standing. 11 Adolph v. Uber Techs., Inc., 14 Cal. 5th 1104, 1123–24 (2023). 12 Since the decision in Adolph, other district courts in California have concluded that 13 plaintiffs retain standing to pursue non-individual PAGA claims in federal court when their 14 individual PAGA claims have been ordered to arbitration and have adopted the above-described 15 procedure. See Filemon Colores v. Ray Moles Farms, Inc., No. 1:21-cv-00467-JLT-BAM, 2023 16 WL 6215789, at *3 (E.D. Cal. Sept. 25, 2023) (noting that the court found persuasive the 17 defendant’s argument that “this case should be stayed pending the outcome of the arbitration 18 process for the reasons explained in Adolph itself”); Radcliff v. San Diego Gas & Elec. Co., No. 19 20-cv-01555-H-MSB, 2023 WL 8264445, at *1 (S.D. Cal. Nov. 28, 2023) (ordering the parties to 20 arbitrate the plaintiff’s individual PAGA claim and staying the representative PAGA claim 21 pending the outcome of the arbitration); Rubio v. Marriott Resorts Hosp. Corp., No. 8:23-cv- 22 00773-FWS-ADS, 2023 WL 8153535, at *4 (C.D. Cal. Oct. 17, 2023) (“The court also adopts 23 Adolph’s proposed procedure and stays [the p]laintiff’s non-individual PAGA claims pending the 24 result of arbitration.”). 25 Accordingly, the court will stay plaintiff’s representative PAGA claims in keeping with 26 the decision and instruction of the California Supreme Court in Adolph. 27 ///// 28 ///// 1 CONCLUSION 2 For the reasons explained above: 3 1. Defendant’s request for judicial notice (Doc. No. 13) is denied; 4 2. Defendant’s motion to compel arbitration of plaintiff's individual claims (Doc. 5 No. 12) is granted; 6 3. Plaintiff's representative PAGA claims are stayed pending the completion of 7 arbitration; and 8 4. Plaintiff and defendant are required to notify the court that arbitration proceedings 9 have concluded within fourteen (14) days of the issuance of the arbitrator’s 10 decision. IT IS SO ORDERED. | Dated: _ April 29, 2024 Da A. 2, ye 13 DALE A. DROZD 4 UNITED STATES DISTRICT JUDGE
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