Peoples v. Children's Hospital of Central California

District Court, E.D. California·Decided January 29, 2020·No. 1:19-cv-00272·Unknown

Opinion

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

YVONNE PEOPLES, et al., 1:19-cv-00272-LJO-SKO

Plaintiffs, ORDER RE DEFENDANTS’ MOTION TO COMPEL ARBITRATION v. ECF No. 45 CALIFORNIA, et al., Defendants.

On August 21, 2019, Defendant Valley Children’s Hospital, Inc. (“VCH”) filed the instant

motion to compel arbitration and dismiss or stay proceedings. See ECF Nos. 45–46. Plaintiff Yvonne

Peoples (“Ms. Peoples”) filed her opposition on August 29, 2019. See ECF No. 47. VCH filed its reply on September 11, 2019, and September 12, 2019.1 See ECF Nos. 55, 58.

The Court has reviewed the parties’ filings and has determined the motion to compel arbitration

is suitable for decision based on the papers under Local Rule 230(g).

This is Ms. Peoples’s second lawsuit against VCH. In 2015, Plaintiff filed her first suit against

VCH alleging wrongful termination, discrimination, and retaliation. See ECF No. 50 ¶ 9. In August

to her position. See id. ¶¶ 9–10.

After the settlement and Ms. Peoples’s reinstatement, Ms. Peoples alleges that she was subject to

more unlawful conduct at VCH and that VCH breached the implied covenant of good faith and fair

dealing with respect to the Settlement Agreement. See ECF No. 50 ¶¶ 10–14. Ms. Peoples filed a charge

with the Equal Employment Opportunity Commission (“EEOC”) on November 20, 2018. See id. ¶ 3. On

November 29, 2018, the EEOC issued a notice of right to sue. See id. Ms. Peoples received a right to sue

letter under California’s Fair Employment and Housing Act (“FEHA”) in late October 2018. See id.

On February 26, 2019, Ms. Peoples filed the instant action against Defendants Children’s Hospital of Central California and Valley Children’s Hospital, Inc. (“VCH”).2 See ECF No. 1. She raises

claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-3(a) (“Title VII”);

California’s Fair Employment and Housing Act (“FEHA”); as well as state law claims for wrongful

termination in violation of public policy and California Labor Code § 1102.5. See ECF No. 50. Ms.

Peoples amended her complaint on September 4, 2019. See ECF No. 50. The amended complaint joins

Ms. Peoples’s husband, Claud S. Peoples (“Mr. Peoples”), Mr. Peoples’s loss of consortium claim, and

adds a breach of the covenant of good faith and fair dealing claim on behalf of Ms. Peoples. See ECF

No. 49 at 3; see generally ECF No. 50.

VCH filed its first motion to compel arbitration on March 21, 2019, citing an arbitration

provision contained within the parties’ Settlement Agreement. See ECF Nos. 13, 19. The Settlement

Agreement provides: “In lieu of filing a civil lawsuit, Employee and Employer agree to submit any

disputes arising from Employee’s employment or any breach of this Agreement, to binding arbitration

subject to the JAMS Employment Arbitration Rules and Procedures. Prior to arbitration, the parties

2 VCH was err oneously sued under its former name, Children’s Hospital of Central California. See ECF premature, citing the parties’ agreement to first attempt mediation before arbitration. See id.; ECF No.

36 at 2. The Court’s denied VCH’s motion without prejudice. See ECF No. 26.

The parties attended mediation on August 5, 2019. See ECF No. 46 at 2; ECF No. 47 at 3. In

preparation for the mediation, VCH asserts it spent time analyzing the case, preparing a

recommendation, and drafting a confidential mediation brief. See ECF No. 45-2 at 2; ECF No. 56 at 2;

ECF No. 58 at 1. VCH contends it provided Ms. Peoples’s counsel with its confidential mediation brief

to help foster settlement. See ECF No. 56 at 2. VCH’s head of Employee Relations, VCH’s General

Counsel, and VCH’s outside counsel attended the mediation. See ECF No. 56 at 2; ECF No. 58 at 1.

Needless to say, the mediation was unsuccessful. See ECF No. 45-2 at 2; ECF No. 47 at 3. Ms. Peoples

primarily argues that the Court should deny the motion to compel arbitration because mediation was not

“meaningful.” ECF No. 47 at 3. Regardless of the productivity of the mediation, the Court finds that the

parties attempted mediation pursuant to a valid arbitration agreement. Thus, the motion to compel

arbitration is GRANTED.

Under the Federal Arbitration Act (“FAA”), a “written provision in any ... contract evidencing a

transaction involving commerce to settle by arbitration a controversy ... shall be valid, irrevocable, and

enforceable, save upon such grounds as exist at law or in equity for the revocation of the contract.” 9

U.S.C. § 2. The FAA “leaves no place for the exercise of discretion by a district court, but instead

mandates that district courts shall direct the parties to proceed to arbitration on issues as to which an

arbitration agreement has been signed.” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218 (1985)

(emphasis in original). This Court’s role is limited to determining: “(1) whether a valid agreement to

arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue.” Kilgore v.

KeyBank, Nat’l Ass’n, 718 F.3d 1052, 1058 (9th Cir. 2013) (en banc) (citation omitted); see also 9

U.S.C. § 2. law principles that govern the formation of contracts.” Ingle v. Circuit City Stores, Inc., 328 F.3d 1165,

1170 (9th Cir. 2003) (internal quotation marks and citation omitted). If the court is satisfied “that the

making of the arbitration agreement or the failure to comply with the agreement is not in issue, the court

shall make an order directing the parties to proceed to arbitration in accordance with the terms of the

agreement.” 9 U.S.C. § 4. “[A]ny doubts concerning the scope of arbitrable issues should be resolved in

favor of arbitration.” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24–25 (1983).

“California law, like federal law, favors enforcement of valid arbitration agreements.”

Armendariz v. Found. Health Psychcare Servs., Inc., 24 Cal. 4th 83, 97 (2000). “[U]nder both federal

and 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. In other words, under California

law, as under federal law, an arbitration agreement may only be invalidated for the same reasons as

other contracts.” Id. at 98 (citations and footnote omitted).

Ms. Peoples argues that: (1) the parties have not engaged in meaningful mediation, which Ms.

Peoples contends is required under the Settlement Agreement; (2) VCH repeatedly failed to comply with

the mediation/arbitration clause and thus cannot enforce it; (3) federal and state law does not support a

motion to compel; and (4) this matter includes non-arbitrable claims. See ECF No. 47 at 1. Before

turning to Ms. Peoples’s arguments, the Court must first analyze whether the Kilgore factors are

satisfied.

A. Arbitrability

1. Armendariz Analysis

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