Laura O’Dell, Holly Zimmerman, and Lauren Miller, individually and on behalf of all others similarly situated v. AYA HEALTHCARE, INC.

Opinion

1 2 3 4 7 8 LAURA O’DELL, HOLLY Case No.: 3:22-cv-1151-CAB-MMP ZIMMERMAN, and LAUREN MILLER, 9 individually and on behalf of all others ORDER REGARDING 10 similarly situated, DEFENDANT’S NOTICE OF APPEAL 11 Plaintiffs,

12 v. [Doc. No. 219] 14 Defendant. 15 16 This case recently returned to the Court following the Ninth Circuit’s mandate. The 17 Court ordered a joint status report on the parties’ suggested next steps given the appellate 18 decision. [Doc. No. 190.] The Court subsequently held Defendant’s pre-appeal motion to 19 compel arbitration in abeyance, conditionally certified a collective under the Fair Labor 20 Standards Act, and ordered the parties to meet and confer regarding a revised notice and 21 notice process. [Doc. No. 199; Doc. No. 214-4 at 17.] No notice has been ordered or 22 distributed. 23 On May 27, 2026, Defendant filed an Ex Parte Motion to Compel Arbitration, 24 Decertify or Reconsider Certification, and for Entry of a Stay. [Doc. No. 214.] This ex 25 parte motion remains pending. 26 On June 10, 2026, Defendant filed a Notice of Appeal as to (1) the Court’s “oral 27 rulings entered on May 11, 2026, holding [Defendant’s] motion to compel arbitration in 28 abeyance and refusing a stay under 9 U.S.C. § 3”; (2) “the written order entered May 12, 1 2026, partially granting plaintiffs’ motion for conditional certification of a collective 2 action”; and (3) “all other orders, rulings, and judgments merged therein.” [Doc. No. 219.] 3 Defendant claims that the Court’s “orders refusing [Defendant’s] request for a stay under 4 Section 3 are appealable as of right under 9 U.S.C. § 16(a)(1)(A).” [Id.] 5 The Court sees no basis for Aya’s appeal given that the Court has not denied Aya’s 6 motion to compel arbitration or for a stay under 9 U.S.C. § 3. [Doc. No. 214 (Defendant’s 7 pending “Ex Parte Motion to Compel Arbitration, Decertify or Reconsider Certification, 8 and for Entry of a Stay”); Doc. No. 214-4 at 17 (the Court holding motion to compel 9 arbitration in abeyance).] Nor has the Court certified an interlocutory appeal under 28 10 U.S.C. § 1292(b). 11 Following remand from the Ninth Circuit, the Court exercised its “substantial 12 judicial discretion” with respect to “the proper means of managing a collective action[,]” 13 Harrington v. Cracker Barrel Old Country Store, Inc., 142 F.4th 678, 684 (9th Cir. 2025), 14 by conditionally certifying a collective and ordering the parties to submit a revised notice 15 and notice plan. This case management decision was based on Defendant’s position at the 16 mandate hearing that even if the Court found the arbitration agreement unenforceable 17 against the current Opt-In Plaintiffs, Defendant would move for arbitration each time any 18 additional plaintiff—of the more than 400,000 potential plaintiffs—subsequently opted in 19 to the collective. [Doc. No. 214-4 at 11, ll. 18-19 (“[O]ur position is we are going to be 20 right back here moving to compel those arbitrations as well.”); id. at 10–11, ll. 19–4.] 21 Ascertaining the full scope of the collective instead allows the Court to efficiently entertain 22 and decide a motion to arbitrate with respect to all possible collective members, which 23 Defendant may then appeal if denied, rather than proceeding seriatim seemingly ad 24 infinitum. 25 The Court believes the Ninth Circuit explicitly approved this sequence in 26 Harrington, holding that “where the existence and validity of an arbitration agreement 27 remains in dispute, a district court is not required to rule on the arbitrability of absent 28 employees’ claims prior to authorizing notice. Instead, the district court may reserve that 1 determination until after the prospective plaintiffs have, in fact, opted into the litigation.” 2 || 142 F.4th at 684. Here, the validity of the arbitration agreement remains in dispute, as 3 ||evidenced by Defendant’s pending motion to compel arbitration and the parties’ dispute 4 || over whether the arbitration agreement is unconscionable and therefore invalid with respect 5 the Opt-In Plaintiffs. [E.g. Doc. No. 214-1 at 13-20; Doc. No. 150.] 6 The Court therefore intends to proceed with the case, including to order notice to the 7 conditionally certified collective. Though the filing of a notice of appeal ordinarily divests 8 || the district court of jurisdiction, “[w]hen a Notice of Appeal is defective in that it refers to 9 ||a non-appealable interlocutory order, it does not transfer jurisdiction to the appellate court, 10 |/and so the ordinary rule that the district court cannot act until the mandate has issued on 11 appeal does not apply.” Nascimento v. Dummer, 508 F.3d 905, 908 (9th Cir. 2007). 12 || Rather, “when an improper appeal is taken, the district court retains its jurisdiction to act 13 the case, and its extant orders must be followed by the litigants, at risk of grave 14 |/sanction.” Jd. at 910. 15 Itis SO ORDERED. 16 ||Dated: June 12, 2026 (GB 17 Hon. Cathy Ann Bencivengo 18 United States District Judge 19 20 21 22 23 24 25 26 27 28