Flora v. Prisma Labs, Inc.

• Court: District Court, N.D. California
• Decided: August 8, 2023
• Docket: 3:23-cv-00680
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 IN THE UNITED STATES DISTRICT COURT 9 FOR THE NORTHERN DISTRICT OF CALIFORNIA 10 11 JACK FLORA, et al., Case No. 23-cv-00680-CRB

12 Plaintiffs,

ORDER GRANTING MOTION TO 13 v. COMPEL ARBITRATION

14 PRISMA LABS, INC., 15 Defendant.

16 Plaintiffs Jack Flora, Nathan Stoner, Courtney Owens, Eric Matson, and D.J.1 17 (“Plaintiffs”) bring this putative class action against Defendant Prisma Labs, Inc. 18 (“Prisma”), accusing Prisma of “collect[ing]” their “facial geometry” through Plaintiffs’ 19 use of Prisma’s app, Lensa. See Compl. (dkt. 1). Plaintiffs contend that Lensa collects 20 and stores the biometric data of users’ faces obtained from their photos, violating the 21 Illinois Biometric Information Privacy Act (BIPA). Prisma moves to compel arbitration, 22 because Plaintiffs assented to Lensa’s Terms of Use, which includes a binding arbitration 23 clause. See Mot. (dkt. 21). 24 As explained below, finding this matter suitable for resolution without oral 25 argument pursuant to Civil Local Rule 7-1(b), the Court vacates the hearing scheduled for 26 August 18, 2023, and GRANTS Prisma’s motion. 27 I. BACKGROUND 1 Prisma’s app, Lensa, allows users to upload photos to edit and retouch. Compl. ¶ 1. 2 In late 2022, Lensa’s popularity skyrocketed with the launch of its “magic avatar” 3 feature—using AI to turn user’s photos into artistic or cartoonish depictions of their 4 likeness, applying different styles such as “cosmic,” “anime,” or “fairy princess.” 5 Id. ¶¶ 14, 17. Criticism from many corners soon followed: Artists contended that Lensa 6 employed AI trained on copyrighted images created by humans who received no 7 compensation for their contributions to the images generated by Lensa, id. ¶ 25; users 8 found that the app would create sexualized images from non-sexual, fully-clothed photos, 9 id. ¶ 26; and, the subject of this lawsuit, advocates concerned with Lensa users’ privacy 10 argued that Prisma was capturing and retaining “the facial geometry of the subjects of the 11 images” uploaded to Lensa, without their subjects’ consent. Id. ¶ 27. 12 When a user downloads the Lensa app, they are required to agree to Lensa’s Terms 13 of Use and Privacy Policy to use it. Compl. ¶ 19. Each of the Plaintiffs allege that they 14 “received disclosure” of Lensa’s Privacy Policy and agreed to its Terms of Use when they 15 downloaded the app in December 2022. Id. ¶¶ 3–7. 16 At issue in this motion is the arbitration provision in Lensa’s Terms of Use. The 17 section, titled “Dispute Resolution; Binding Arbitration,” appears in larger, bolded font 18 (like the other section headings in the document) and states in smaller, bolded font 19 underneath it: “Please read the following Section carefully because it requires you to 20 arbitrate certain disputes and claims with the Company and limits the manner in which you 21 can seek relief from us.” Sadun Decl. (dkt. 21-1) Ex. A at 10 (“Terms of Use”).2 The 22 provision states that “all disputes arising out of or relating to these Terms or Lensa will be 23 resolved through confidential binding arbitration held in Santa Clara County, California in 24 accordance with the Streamlined Arbitration Rules and Procedures (“Rules”) of the 25 Judicial Arbitration and Mediation Services (“JAMS”), which are available on the JAMS 26

27 2 Because it is “not subject to reasonable dispute,” the Court takes judicial notice of Lensa’s then- 1 website and hereby incorporated by reference.” Id. The provision also forbids class 2 arbitrations and class actions; requires that the enforceability of the arbitration provision be 3 governed by the FAA; gives the arbitrator “exclusive authority to make all procedural and 4 substantive decisions regarding any dispute”; that “for any arbitration [the user] intiate[s], 5 [the user] will pay the filing fee and the Company will pay the remaining JAMS fees and 6 costs”; and that users may opt out of binding arbitration if they notify Prisma in writing 7 within 30 days. Id. at 10–11. 8 II. LEGAL STANDARD 9 The Federal Arbitration Act (FAA) provides that contractual arbitration agreements 10 are “valid, irrevocable, and enforceable, save upon such grounds as exist at law or in 11 equity for the revocation of any contract.” 9 U.S.C. § 2; Rent-A-Ctr., W., Inc. v. Jackson, 12 561 U.S. 63, 67–68 (2010). Private agreements to arbitrate under the FAA are enforced 13 according to their terms. 9 U.S.C. § 4. Therefore, a party may petition a district court “for 14 an order directing that such arbitration proceed in the manner provided for in such 15 agreement.” Id. 16 Generally, a party “cannot be required to submit to arbitration any dispute which he 17 has not agreed so to submit.” AT&T Techs., Inc. v. Commc’ns Workers of Am., 475 U.S. 18 643, 648 (1986) (internal quotation marks omitted). However, courts have developed a 19 “liberal federal policy favoring arbitration agreements,” Moses H. Cone Mem’l Hosp. v. 20 Mercury Constr. Corp., 460 U.S. 1, 24 (1983), such that courts should not refuse to enforce 21 them unless the agreement is “not susceptible of an interpretation that covers the asserted 22 dispute.” AT&T Techs., 475 U.S. at 650. Under the FAA, in assessing the enforceability 23 of a contractual arbitration provision, a district court’s role is “limited to determining (1) 24 whether a valid agreement to arbitrate exists, and if it does, (2) whether the agreement 25 encompasses the dispute at issue.” Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 26 1126, 1130 (9th Cir. 2000). If the answer to both inquiries is affirmative, then the FAA 27 requires the court to enforce the agreement in accordance with its terms. Id. “[T]he party 1 arbitration.” Green Tree Fin. Corp.- Ala. v. Randolph, 531 U.S. 79, 91 (2000). 2 III. DISCUSSION 3 Plaintiffs make two arguments against compelling arbitration:3 First, the arbitration 4 provision is unconscionable; and second, because some provisions in the arbitration 5 agreement arguably fall below JAMS’ Consumer Arbitration Minimum Standards, the 6 arbitration provision is illusory. 7 A. Unconscionable 8 First, Plaintiffs argue that the arbitration agreement is unenforceable because it is 9 unconscionable. In analyzing contracts under the FAA, courts generally “apply ordinary 10 state-law principles that govern the formation of contracts.” First Options of Chi., Inc. v. 11 Kaplan, 514 U.S. 938, 944 (1995); Nguyen v. Barnes & Noble Inc., 763 F.3d 1171, 1175 12 (9th Cir. 2014). Because the choice-of-law provision in Lensa’s Terms of Use requires 13 that California law be applied, see Terms of Use at 11, the Court applies California law to 14 the extent that it does not directly conflict with the FAA.4 Bridge Fund Cap. Corp. v. 15 Fastbucks Franchise Corp., 622 F.3d 996, 1002 (9th Cir. 2010). Under California law, a 16 contract is unenforceable when it is both procedurally and substantively unconscionable:

17 [T]he prevailing view is that procedural unconscionability and substantive unconscionability need not both be present to the 18 same degree: Essentially a sliding scale is invoked which disregards the regularity of the procedural process of the 19 contract formation . . . in proportion to the greater harshness or unreasonableness of the substantive terms themselves. 20 21 Nagrampa v. MailCoups, Inc., 469 F.3d 1257, 1280 (9th Cir. 2006) (internal quotation 22 marks omitted) (quoting Armendariz v. Found. Health Psychcare Servs., Inc., 24 Cal. 4th 23 83, 114 (2000)). 24 25

26 3 Plaintiffs do not argue that they did not assent to Lensa’s Terms of Use, or that the arbitration 27 clause in the Terms of Use does not cover their claims. 1. Procedural Unconscionability 1 A determination of procedural unconscionability involves the analysis of two 2 factors: (1) oppression; and (2) surprise. Id. at 1280. Oppression is found when there is 3 such an inequality in bargaining power between two parties that there is no actual 4 negotiation and a lack of meaningful choice. Id. Surprise is found when the “supposedly 5 agreed-upon terms are hidden in a prolix printed form drafted by the party seeking to 6 enforce them.” Id. (quoting Flores v. Transamerica HomeFirst, Inc., 93 Cal. App. 4th 846, 7 853 (2001)). 8 Plaintiffs’ only argument for procedural unconscionability hinges on the Terms of 9 Use being a contract of adhesion, giving Plaintiffs “no ability to negotiate its terms.” 10 Opp’n (dkt. 25) at 7. As a preliminary matter, California courts consider contracts of 11 adhesion procedurally unconscionable to at least a minimal degree due to a lack of 12 bargaining power. Bridge Fund Cap. Corp., 622 F.3d at 1004. However, California courts 13 only refuse to enforce contracts of adhesion if they are “unduly oppressive.” Armendariz, 14 24 Cal. 4th at 113. But, crucially, Plaintiffs argue only that the arbitration provision in 15 Lensa’s Terms of Use is unconscionable, see Opp’n at 7–9, and that provision allows users 16 to opt out of binding arbitration by mailing a notification of their intent to do so to Lensa 17 within 30 days. See Terms of Use at 10–11. 18 The Ninth Circuit has squarely held that where there is a meaningful opportunity to 19 opt out of an arbitration agreement, that agreement is not adhesive. Mohamed v. Uber 20 Techs., Inc., 848 F.3d 1201, 1211 (9th Cir. 2016) (citing Circuit City Stores, Inc. v. 21 Ahmed, 283 F.3d 1198, 1199 (9th Cir. 2002)). While Mohamed and Ahmed addressed 22 employment contracts, courts have routinely applied the same principles to consumer 23 contracts like Lensa’s. See James v. Comcast Corp., No. 16-CV-02218-EMC, 2016 WL 24 4269898, at *3 (N.D. Cal. Aug. 15, 2016); Mohammad v. T-Mobile USA, Inc., No. 2:18- 25 CV-00405-KJM-DB, 2018 WL 6249910, at *5 (E.D. Cal. Nov. 29, 2018); Lag Shot LLC 26 v. Facebook, Inc., 545 F. Supp. 3d 770, 779–80 (N.D. Cal. 2021); McLellan v. Fitbit, Inc., 27 No. 3:16-CV-00036-JD, 2017 WL 4551484, at *3 (N.D. Cal. Oct. 11, 2017); Alkutkar v. 1 Bumble Inc., No. 22-CV-00422-PJH, 2022 WL 4112360, at *9 (N.D. Cal. Sept. 8, 2 2022), reconsideration denied, No. 22-CV-00422-PJH, 2022 WL 16973253 (N.D. Cal. 3 Nov. 16, 2022). After all, employees signing employment contracts might feel inclined 4 not to opt out of an arbitration provision for fear of rocking the boat with a new employer. 5 See, e.g., Gentry v. Superior Ct., 42 Cal. 4th 443, 472 (2007) (“Given the inequality 6 between employer and employee and the economic power that the former wields over the 7 latter, it is likely that Circuit City employees felt at least some pressure not to opt out of 8 the arbitration agreement.” (internal citation omitted)). But a consumer is not apt to have 9 the same hesitation when deciding whether to opt out of arbitration against a photo editing 10 app. See James, 2016 WL 4269898, at *3 (“This case concerns a non-essential service, not 11 a source of one’s livelihood.”). The Court therefore concludes that, because Plaintiffs had 12 a meaningful opportunity to opt out of the arbitration provision, the agreement was not 13 adhesive. 14 Additionally, while Plaintiffs do not argue the surprise element of procedural 15 unconscionability, the Court holds that there was no surprise.5 The Terms of Use is short 16 and written in legible font; the arbitration provision, like all sections of the agreement, is 17 bolded and clearly labelled “Dispute Resolution; Binding Arbitration”; underneath that 18 heading, a bold statement instructs users: “Please read the following section carefully 19 because it requires you to arbitrate certain disputes and claims with the company and limits 20 the manner in which you can seek relief from us.” The opt-out provision, while not 21 bolded, is clearly written in the same legible font as the rest of the agreement, and included 22 in the arbitration provision itself, not hidden elsewhere in the agreement. In all, the 23 arbitration provision is not “hidden in a prolix printed form” such that a user could claim 24 surprise. Nagrampa, 469 F.3d at 1280. 25 Therefore, “[b]ecause the agreement[] [is] not procedurally unconscionable, and 26 27 5 Indeed, in Mohamed, the Ninth Circuit did not even discuss the surprise element when deciding that the arbitration provision at issue was not procedurally unconscionable. See 848 F.3d at 1211 1 because both procedural and substantive unconscionability must be present in order for an 2 agreement to be unenforceable, we need not reach the question whether the agreement[] 3 here [was] substantively unconscionable.” Mohamed, 848 F.3d at 1211 (internal citation 4 omitted). 5 B. Illusory 6 Second, Plaintiffs argue that, because two aspects of the arbitration provision in 7 Lensa’s Terms of Use arguably do not meet JAMS’ Consumer Arbitration Minimum 8 Standards, there was no meeting of the minds as to the arbitration provision in the contract. 9 As Plaintiffs put it: “The parties cannot have agreed to an arbitration before JAMS that 10 JAMS will not hear.” Opp’n at 5. Defendants make three arguments in response: First, 11 that by incorporating the JAMS Streamlined Arbitration Rules,6 the parties agreed to 12 arbitrate arbitrability; second, the provisions in question—the location of the arbitration 13 and how the arbitrator’s fees will be paid—do not conflict with the JAMS Rules; and third, 14 that the offending provisions are severable. 15 1. Agreement to Arbitrate Arbitrability 16 In general, parties may delegate questions of arbitrability to the arbitrator, if by 17 “clear and unmistakable evidence,” the parties have chosen to do so. See Brennan v. Opus 18 Bank, 796 F.3d 1125, 1130 (9th Cir. 2015); see also Henry Schein, Inc. v. Archer & White 19 Sales, Inc., 139 S. Ct. 524, 530 (2019) (“[I]f a valid agreement exists, and if the agreement 20 delegates the arbitrability issue to an arbitrator, a court may not decide the arbitrability 21 issue.”). The Ninth Circuit has held that, at least in cases concerning sophisticated parties, 22 incorporation of arbitration rules that delegate questions of arbitrability to the arbitrator 23 “constitutes clear and unmistakable evidence that the contracting parties agreed to arbitrate 24 arbitrability.” Brennan, 796 F.3d at 1130; see also Oracle America, Inc. v. Myriad Group 25

26 6 See JAMS Streamlined Arbitration Rules § 8(b) (“Jurisdictional and arbitrability disputes, 27 including disputes over the formation, existence, validity, interpretation or scope of the agreement under which Arbitration is sought, and who are proper Parties to the Arbitration, shall be 1 A.G., 724 F.3d 1069, 1074 (9th Cir. 2013) (“Virtually every circuit to have considered the 2 issue has determined that incorporation of the American Arbitration Association’s (AAA) 3 arbitration rules constitutes clear and unmistakable evidence that the parties agreed to 4 arbitrate arbitrability.”). However, because Brennan and Oracle America involved 5 sophisticated parties, they left open the question of whether incorporation of arbitration 6 rules in consumer contracts similarly constitutes “clear and unmistakable evidence” of 7 intent to arbitrate arbitrability, and courts are split on the issue. Brennan, 796 F.3d at 1130 8 (“[O]ur holding does not foreclose the possibility that this rule could also apply to 9 unsophisticated parties or to consumer contracts.”); compare, e.g., Luckert v. Tesla Energy 10 Operations, Inc., No. 21-CV-03027-VC, 2021 WL 3721967, at *1 (N.D. Cal. Aug. 5, 11 2021) (applying Brennan to a consumer contract without regard to the consumer’s 12 sophistication), with Mikhak v. Univ. of Phoenix, No. C16-00901 CRB, 2016 WL 13 3401763, at *5 (N.D. Cal. June 21, 2016) (weighing the plaintiff’s sophistication and 14 concluding that because “[s]uch a barrage of materials might understandably seem 15 confusing to an individual without experience reviewing legal documents or negotiating 16 employment contracts,” incorporation of AAA rules was not evidence of a clear and 17 unmistakable intent to delegate arbitrability to the arbitrator). 18 The Court cannot conclude on this record that the parties clearly and unmistakably 19 agreed to arbitrate arbitrability. While the parties’ briefing does not discuss the parties’ 20 sophistication (or lack thereof) in any depth, nothing in the complaint indicates that, as lay 21 users of a photo editing app, the Plaintiffs understood that by incorporating JAMS’ 22 Streamlined Arbitration Rules, that they were delegating gateway issues of arbitrability to 23 a JAMS arbitrator.7 The Court therefore declines to extend Brennan to this case and 24 proceeds to decide gateway questions of arbitrability. 25 2. Conflicting Terms 26 Plaintiffs argue that two terms of the arbitration provision are incompatible with 27 1 JAMS’ Consumer Arbitration Minimum Standards: First, the forum selection clause 2 requiring that arbitration take place in Santa Clara County; and second, incorporation of 3 JAMS’ Streamlined Arbitration Rules requires that the parties are jointly and severally 4 liable for the arbitrator’s fees. 5 a. Location of Arbitration 6 While Lensa’s Terms of Use states that “all disputes . . . will be resolved through 7 confidential binding arbitration held in Santa Clara County, California,” JAMS Arbitration 8 Minimum Standards require that “[t]he consumer must have a right to an in-person hearing 9 in his or her hometown area,” which, in this case, is in Illinois.8 See Compl. ¶¶ 3–7. 10 Prisma’s arguments that these provisions are not in conflict are unpersuasive. 11 Prisma first argues that “forum selection clauses are presumed to be non-exclusive absent 12 an express statement to the contrary,” citing In re 1250 Oceanside Partners, 652 F. App’x 13 588 (9th Cir. 2016). Reply (dkt. 27) at 12. That case, and the cases it relies upon, concern 14 a much more permissive forum selection clause than the one at issue here. Compare 15 Oceanside Partners, 652 F. App’x at 589 (“[Plaintiff] may seek to foreclose on the property 16 . . . by a foreclosure action filed in the Circuit Court of the Third Circuit, State of 17 Hawaii[.]”); with Terms of Use at 10 (“[A]ll disputes arising out of or relating to these 18 Terms or Lensa will be resolved through confidential binding arbitration held in Santa 19 Clara County, California . . . .”). Prisma next argues that “it is unlikely that JAMS would 20 refuse to arbitrate the case” based on the conflict between the forum selection clause and 21 JAMS’ minimum standards. Reply at 12–13. But Prisma provides no authority from 22 JAMS or elsewhere to underpin that assumption.9 Therefore, on their face, it appears that 23 24 8 Consumer Arbitration Minimum Standards, JAMS (July 15, 2009), https://www.jamsadr.com/consumer-minimum-standards/. Because it is “not subject to reasonable 25 dispute,” the Court takes judicial notice of JAMS’ Consumer Arbitration Minimum Standards. See Fed. R. Evid. 201(b); Khoja, 899 F.3d at 999.

26 9 It is not lost on the Court that the Plaintiffs bring this action “exactly where the forum selection 27 clause would have them undergo arbitration.” Zaborowski v. MHN Gov’t Servs., Inc., 936 F. Supp. 2d 1145, 1156 (N.D. Cal. 2013); Cobarruviaz v. Maplebear, Inc., 143 F. Supp. 3d 930, 942 1 the forum selection clause in Lensa’s terms and in JAMS’ minimum standards are in 2 conflict. See Nguyen v. OKCoin USA Inc., No. 22-CV-06022-KAW, 2023 WL 2095926, 3 at *3 (N.D. Cal. Feb. 17, 2023) (holding that “any delegation clause to JAMS [is] 4 effectively void” in part because requiring that the arbitration be conducted in San 5 Francisco does not comport with JAMS’ minimum standards). 6 b. Arbitrator’s Fees 7 Plaintiffs further contend that, because the agreement incorporates JAMS’ 8 Streamlined Arbitration Rules—and these rules make the parties “jointly and severally 9 liable for the payment of JAMS Arbitration fees and Arbitrator compensation and 10 expenses”—that the fee provision of the agreement is also in violation of JAMS’ minimum 11 standards. Opp’n at 5 (quoting JAMS Streamlined Arbitration Rules § 26(c)). This 12 contorted reading of the agreement and JAMS’ rules does not stand up to scrutiny. 13 JAMS’ Consumer Arbitration Minimum Standards requires that “when a consumer 14 initiates arbitration against the company, the only fee required to be paid by the consumer 15 is $250, . . . [and] [a]ll other costs must be borne by the company, including any remaining 16 JAMS Case Management Fee and all professional fees for the arbitrator’s services.” 17 JAMS’ Consumer Arbitration Minimum Standards ¶ 7. Lensa’s Terms of Use repeats this 18 requirement almost verbatim: “You and the Company agree that for any arbitration you 19 initiate, you will pay the filing fee and the Company will pay the remaining JAMS fees 20 and costs.” Terms of Use at 10. However, JAMS’ Streamlined Arbitration Rules require 21 that “[t]he Parties are jointly and severally liable for the payment of JAMS Arbitration fees 22 and Arbitrator compensation and expenses.” JAMS Streamlined Arbitration Rules § 26(c). 23 Plaintiffs argue that by incorporating JAMS’ Streamlined Arbitration Rules, the parties 24 have incorporated Rule 26(c), and thus the agreement fails to meet JAMS’ minimum 25 standards—effectively arguing, as Prisma points out, that JAMS’ Streamlined Arbitration 26 Rules are incompatible with its Consumer Arbitration Minimum Standards. 27 1 Putting aside the absurdity of that contention, the plain language of the Terms of 2 Use indicates that the parties intended to comply with JAMS’ minimum standards. The 3 statement in the agreement that “for any arbitration [the user] intiate[s],” the user will pay 4 the filing fee and the Company will pay “the remaining JAMS fees and costs,” Terms of 5 Use at 10, clearly indicates that the user will pay the filing fee JAMS requires of 6 consumers—i.e., the $250 payment mentioned in JAMS’ minimum standards10—and 7 Prisma will pay for everything else. Incorporation of the JAMS Streamlined Arbitration 8 Rules does not alter this clear reading—indeed, one provision of those rules allows the 9 parties to craft their own. See JAMS Streamlined Arbitration Rules § 2(a) (“The Parties 10 may agree on any procedures not specified herein or in lieu of these Rules that are 11 consistent with the applicable law and JAMS policies (including, without limitation, Rules 12 12(j), 25 and 26).”). That is precisely what the parties apparently did here, to comply with 13 JAMS’ minimum standards. As a result, there is no conflict between the fee provision in 14 the Terms of Use and JAMS’ minimum standards. 15 c. Severability 16 Because the Court has determined that one provision Plaintiffs challenge—the 17 forum selection clause—conflicts with JAMS’ minimum standards, it must decide whether 18 that provision is severable,11 and the arbitration provision may otherwise be enforced 19 despite the conflict. The Court concludes that the forum selection clause may be severed, 20 and arbitration administered by JAMS may go forward. 21 To determine whether an unlawful contract may be cured through severance, 22 “[c]ourts are to look to the various purposes of the contract.” Armendariz, 24 Cal. 4th at 23 124. “If the central purpose of the contract is tainted with illegality, then the contract as a 24 25 10 Arbitration Schedule of Fees and Costs, JAMS, https://www.jamsadr.com/arbitration-fees (last visited Aug. 8, 2023) (“For matters involving consumers, the consumer is only required to pay 26 $250. See JAMS Policy on Consumer Arbitrations Pursuant to Pre-Dispute Clauses.”).

27 11 Lensa’s Terms of Use contains a severability clause. See Terms of Use at 14 (“If any provision of these Terms is held invalid and unenforceable . . . that provision will be enforceable to the 1 whole cannot be enforced.” Id. In the context of unconscionable forum selection clauses 2 in arbitration provisions, courts routinely hold that such clauses are severable because they 3 “d[o] not relate to the ‘agreement’s chief objective.’” Lang v. Skytap, Inc., 347 F. Supp. 4 3d 420, 432–33 (N.D. Cal. 2018) (quoting Armendariz, 24 Cal.4th at 124–25). See also 5 Pope v. Sonatype, Inc., No. 5:15-CV-00956-RMW, 2015 WL 2174033, at *6 (N.D. Cal. 6 May 8, 2015) (“Although Sonatype inserted two clauses that appear to conflict with JAMS 7 rules, simply severing those provisions or interpreting them as not applicable in California 8 and proceeding under the incorporated JAMS rules cures the unconscionability as to those 9 terms and preserves the intent of the Agreement.”); Fitzgerald v. Grand Circle, LLC, No. 10 CV 20-2586, 2020 WL 6152027, at *4 (E.D. Pa. Oct. 20, 2020) (“Clauses regarding forum 11 location and fee-splitting are logistical concerns and can be severed while maintaining the 12 core agreement to arbitrate.”). Where courts have chosen not to sever a forum selection 13 clause, they have done so where there are multiple unlawful terms that render the 14 arbitration agreement “tainted with illegality.” See, e.g., Streedharan v. Stanley Indus. & 15 Auto., LLC, 630 F. Supp. 3d 1244, 1274 (C.D. Cal. 2022) (finding that “multiple 16 unconscionable provisions,” including the forum selection provision, may not be severed); 17 Lim v. TForce Logistics, LLC, 8 F.4th 992, 1006 (9th Cir. 2021) (“[G]iven the pervasive 18 unconscionability of the delegation clause based on multiple unconscionable provisions— 19 the cost-splitting, fee-shifting, and Texas venue provisions—the district court did not 20 abuse its discretion by not severing those unconscionable terms.”). 21 Because there are no other terms that conflict with JAMS’ minimum standards, and 22 because the forum selection provision can easily be severed without affecting any other 23 provision, the Court severs that provision and enforces the arbitration agreement as 24 otherwise agreed upon by the parties.12 25 26 12 In the absence of a forum selected by the parties in the Terms of Use, the arbitrator will likely refer to the incorporated JAMS Streamlined Arbitration Rules, which allow the arbitrator, after 27 consulting with the parties, to “determine the date, time and location of the Hearing.” JAMS Streamlined Arbitration Rules § 14(a). The arbitrator would then, consistent with JAMS’ IV. CONCLUSION For the foregoing reasons, Prisma’s motion to compel is GRANTED. This case is 2 hereby stayed pending arbitration pursuant to 9 U.S.C. § 3. 3 IT IS SO ORDERED. 2 ~~ 4 Dated: August 8, 2023 5 CHARLES R. BREYER 6 United States District Judge 7 8 9 10 11 12 E 13

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