Tony Ramirez v. Dick's Sporting Goods, Inc.

• Court: District Court, N.D. California
• Decided: June 23, 2026
• Docket: 3:26-cv-00260
• Status: Unknown

Opinion

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 NORTHERN DISTRICT OF CALIFORNIA 9 TONY RAMIREZ, 10 Case No. 26-cv-00260-RS Plaintiff, 11 v. ORDER DENYING MOTIONS TO 12 COMPEL, DISMISS/STRIKE, AND DICK'S SPORTING GOODS, INC., STAY THE ACTION 13 Defendant. 14

15 I. INTRODUCTION 16 In this labor law dispute between Dick’s Sporting Goods, Inc. (“DSG”) and its former 17 employee Tony Ramirez, Defendant DSG moves to compel arbitration, dismiss or strike 18 Plaintiff’s class claims pursuant to the alleged agreement to arbitrate, and stay the action pending 19 arbitration. The parties dispute whether DSG waived its right to compel arbitration, whether the 20 agreement is unenforceable due to unconscionability, and whether Plaintiff consented to the 21 agreement. For the reasons set forth below, DSG has not waived its right to compel arbitration nor 22 is the agreement unenforceable due to unconscionability. However, a material factual dispute 23 exists as to the formation of an agreement to arbitrate. Thus, the motion to compel is denied, and, 24 relatedly, the motions to strike/dismiss and to stay are denied as well. 25 II. BACKGROUND 26 DSG is a nationwide sporting goods retailer that employed Plaintiff from approximately 27 November 7, 2024 to May 8, 2025. While working for DSG, Plaintiff acted as an hourly-paid 1 A. Plaintiff’s Suits Against DSG 2 Plaintiff filed a class action against DSG in California state court on May 23, 2025, 3 asserting various violations of California labor law and related causes of action. On July 28, 2025, 4 Plaintiff filed a complaint in a second action asserting a representative claim under the Private 5 Attorneys’ General Act of 2004 (“PAGA”) on behalf of himself and similarly aggrieved 6 employees based on the same underlying California labor law violations. The Alameda Superior 7 Court consolidated Plaintiff’s class and PAGA actions on December 23, 2025, and DSG removed 8 the consolidated action to federal court on January 9, 2026. 9 The alleged violations comprise various claims under California’s Labor and Business and 10 Professions Codes. DSG moves to compel arbitration, dismiss/strike class claims, and stay the 11 action. 12 B. Hiring Plaintiff 13 The parties dispute how Plaintiff was hired. Supported by a sworn declaration of Brad 14 Cohen, a Senior Manager of HR Technology Strategy, all DSG job applicants must log into or 15 create a Workday account to apply for a position and acknowledge and agree to an electronic, 16 standalone arbitration agreement included at the end of the application workflow on Workday 17 (“Arbitration Agreement”). According to DSG, Plaintiff applied for a job with DSG on November 18 1, 2024 via the Workday platform and checked a box at the bottom of the arbitration page under 19 the sentence, “[b]y checking this box I acknowledge that I reviewed the Arbitration Agreement 20 and agree to its terms.” Dkt. 17-1, Cohen Decl., Ex. F. The Workday platform registered the 21 creation of a Workday account associated with Plaintiff’s email on November 1, 2024, id., Ex. D, 22 and acknowledgement and agreement of the Arbitration Agreement via that account four minutes 23 later, id., Ex. F. 24 By contrast, according to Plaintiff, supported by his own sworn declaration, he was not 25 required to create a Workday account to submit his job application to DSG, and he does not recall 26 seeing an arbitration agreement or being told about one. According to Plaintiff, after submitting an 27 online application and then interviewing in-person, he was hired, and a DSG hiring representative 1 instructed him to download the Workday app and “log in to an account they had already created 2 for [him].” Dkt. 18-1, Ramirez Decl., ¶ 8. As Plaintiff recounts, this was his first-time using 3 Workday. Plaintiff also swears that it was his “understanding that his Workday account was not 4 private nor… only accessible to [himself] because the username and password were set up by 5 [DSG], not [himself.]” Id. at ¶ 11. 6 C. Arbitration Agreement 7 DSG’s Arbitration Agreement requires that “all disputes, claims or controversies arising 8 out of, or in any way related to, your application for and/or employment with the [DSG]…be 9 resolved exclusively by final and binding arbitration between the Parties, and not by way of court or jury trial. Subject to limited exceptions… this mutual Agreement covers any claims that 10 the Company may have against [the applicant], or that [the applicant] may have against the 11 Company or its past or present principals, shareholders, members, directors, officers, employees, 12 agents, representatives, successors and assigns (all of whom may enforce this Agreement). This 13 Agreement applies to [an applicant] if [the applicant] continue[s] to apply for employment and/or 14 work for the Company after a copy of this Agreement was made available to [the applicant].” Dkt. 15 17-1, Cohen Decl., ¶ 12; id., Ex. E., § 1 (emphasis in original). 16 The Arbitration Agreement specifically requires arbitration according to the JAMS 17 Employment Arbitration Rules. Id. § 4. It prohibits class actions: “THE PARTIES AGREE THAT 18 EACH MAY BRING CLAIMS AGAINST THE OTHER ONLY IN AN INDIVIDUAL 19 CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY CLASS OR 20 COLLECTIVE ACTION.” Id. § 9. The Arbitration Agreement also delegates disputes related to 21 the Agreement to arbitration: “[t]he arbitrator—and not any federal, state, or local court or 22 agency—will have exclusive authority to resolve disputes relating to the validity, applicability, or 23 enforceability of this Agreement” (“Delegation Clause”). Id, § 20. Lastly, the Agreement contains 24 a severability clause by which unlawful, invalid, or otherwise unenforceable provisions may be 25 reformed or severed, and the rest of the Agreement enforced (“Severability Clause”). Id. § 12. 26 D. Filing of the Present Motion 27 DSG filed the present motion to compel arbitration, dismiss/strike class claims, and stay 1 action on May 14, 2026, one year after Plaintiff filed the class action complaint and five months 2 after removal to federal court. The parties met and conferred on May 18, 2026, at which time 3 Plaintiff’s counsel advised Defendant’s counsel that Plaintiff intended to challenge the 4 enforceability of the Arbitration Agreement as well as his lack of consent to arbitration and requested the parties submit the issues to an arbitrator per the Arbitration Agreement’s delegation 5 clause. The parties did not reach an agreement. Plaintiff’s opposition followed. 6 III. WAIVER 7 “[T]he burden for establishing waiver of an arbitration agreement” is the burden of the 8 party opposing arbitration, and it “is the same as the burden for establishing waiver in any other 9 contractual context.” Armstrong v. Michaels Stores, Inc., 59 F.4th 1011, 1014–1015 (9th Cir. 10 2023). Accordingly, to prove waiver, Ramirez must show: “(1) knowledge of an existing right to 11 compel arbitration and (2) intentional acts inconsistent with that existing right.” Id. at 1015. 12 Neither party disputes that DSG knew of its right to compel arbitration. As to acts inconsistent 13 with that right, Plaintiff points to Defendant’s delay in bringing the present motion and refusal to 14 submit the arbitrability issue to the arbitrator. 15 “Under [Ninth Circuit] precedent, a party generally ‘acts inconsistently with exercising the 16 right to arbitrate when it (1) makes an intentional decision not to move to compel arbitration and 17 (2) actively litigates the merits of a case for a prolonged period of time in order to take advantage 18 of being in court.’ ” Id. (citation omitted). Defendant’s delay here is not sufficient for wavier. 19 Defendant delayed only five months after consolidation and removal before bringing the present 20 motion to compel arbitration, and the parties conducted meet and confer efforts regarding 21 arbitration and ADR in the intervening months. Moreover, Plaintiff does not argue DSG “actively 22 litigate[d] the merits” of the case before moving to compel. See id; Dkt. 18, Opp., 15–16. 23 The focus of Plaintiff’s argument is that Defendant has acted inconsistently with the right 24 to compel arbitration by bringing this motion in federal court rather than adjudicating the question 25 of arbitrability via an arbitrator, as Plaintiff purportedly requested and as is required, according to 26 Plaintiff, by the Agreement’s delegation clause. Defendant, however, claims that “DSG did not 27 refuse to agree to submit the issue of enforceability to an arbitrator” but rather sought clarification 1 regarding Plaintiff’s basis for challenging the Agreement because “certain issues are not delegable 2 to the arbitrator—including formation[.]” Dkt. 19, Reply, at 12. Defendant relies on Ahlstrom v. 3 DHI Mortg. Co., Ltd., L.P. for the position that formation could not be heard by an arbitrator. , 21 4 F.4th 631, 634 (9th Cir. 2021). However, Ahlstrom is factually distinct: the plaintiff there was not willing to consent to arbitration of the threshold issues. See id. While Defendant’s refusal to 5 arbitrate the threshold issues seems inconsistent with its overall effort to compel arbitration, such 6 litigation tactics do not rise to the level of waiver. Accordingly, DSG has not waived its right to 7 compel arbitration. 8 IV. UNCONSCIONABILITY 9 Separate from waiver, Plaintiff argues that the Agreement is unconscionable such that, 10 even if an agreement exists, it still should not be enforced. In California, unconscionability 11 includes an “absence of meaningful choice on the part of one of the parties together with contract 12 terms which are unreasonably favorable to the other party.” Lhotka v. Geographic Expeditions, 13 Inc., 181 Cal. App. 4th 816, 821(Cal. Ct. App. 2010) (citation omitted). Accordingly, 14 unconscionability has both a “procedural” and a “substantive” element. Id. “ ‘[T]he more 15 substantively oppressive the contract term, the less evidence of procedural unconscionability is 16 required…and vice versa.’ ” Poublon v. C. H. Robinson Co., 846 F.3d 1251, 1260 (9th Cir. 2017) 17 (quoting Sanchez v. Valencia Holding Co., LLC, 61 Cal.4th 899, 910, (2015)). Contracts of 18 adhesion necessarily indicate “some degree of procedural unconscionability.” Id. 19 Here, the Arbitration Agreement is a contract of adhesion because it is “a standardized 20 contract, which, imposed and drafted by the party of superior bargaining strength, relegates to the 21 subscribing party only the opportunity to adhere to the contract or reject it.” See Lona v. Citibank, 22 N.A., 202 Cal. App. 4th 89, 109 (2011). Per Defendant’s own telling, an applicant must agree to 23 arbitration or forego applying for any position with DSG, a national retailer. Plaintiff also notes 24 that the Agreement does not include a description of the JAMS rules with which a party to the 25 Agreement must comply. This reflects an element of surprise, albeit minimal. See Carbajal v. 26 CWPSC, Inc., 245 Cal.App.4th 227 (2016). 27 On the other hand, the Arbitration Agreement is featured prominently. In order to proceed 1 the Agreement and check a box acknowledging and agreeing to it. Just before the box that must be 2 checked to proceed, is the warning: 3 “YOU ACKNOWLEDGE THAT YOU HAVE RECEIVED AND REVIEWED THIS AGREEMENT AND THAT BY SIGNING BELOW, 4 ELECTRONICALLY SIGNING THE AGREEMENT, OR ELECTRONICALLY ACCEPTING/AGREEING TO THIS AGREEMENT, YOU ARE AGREEING 5 TO ARBITRATE COVERED DISPUTES UNDER THE TERMS OF THIS AGREEMENT, WHICH BINDS BOTH YOU AND THE COMPANY.” 6 Dkt. 17-1, Cohen Decl., Ex. C. Next to the box that must be checked, reads another warning, “By 7 checking this box I acknowledge that I reviewed the Arbitration Agreement and agree to its 8 terms.” Id. The Agreement in its entirety is available to scroll through on the application page as 9 well as available in a standalone document via hyperlink, and there is no time limit for reviewing 10 and accepting the Agreement. In sum, although there is a degree of procedural unconscionability, 11 in light of the limited evidence of oppression and surprise, it is minimal. See Poublon v. C.H. 12 Robinson Company, 846 F.3d 1251, 1270-71 (9th Cir. 2017) (citing Serpa v. Cal. Surety 13 Investigations, Inc., 215 215 Cal. App. 4th 695, 704 (2013)). 14 Since “the degree of procedural unconscionability of an adhesion agreement” without other 15 indicia of unfairness “is low… the [A]greement will be enforceable unless the degree of 16 substantive unconscionability is high.” See id. “A contract is substantively unconscionable when 17 it is unjustifiably one-sided to such an extent that it shocks the conscience.” Chavarria v. Ralphs 18 Grocery Co., 733 F.3d 916, 923 (9th Cir. 2013). “Although California courts have characterized 19 substantive unconscionability in various ways, [they] all… point to the central idea that 20 unconscionability doctrine is concerned not with a simple old-fashioned bad bargain but with 21 terms that are unreasonably favorable to the more powerful party.” Tompkins v. 23andMe, Inc., 22 840 F.3d 1016, 1023 (9th Cir. 2016) (citations and internal quotations omitted). 23 Plaintiff relies heavily on a 2024 decision by the California Court of Appeal, Cook v. Univ. 24 of S. California. 102 Cal.App.5th 312, 326 (2024), reh'g denied (June 13, 2024). There, the Court of Appeal found that the at-issue arbitration agreement was a contract of adhesion with sufficient 25 substantive unconscionability to be unenforceable for three reasons. The contract was (1) too 26 broad in scope, expressly applying to “ ‘all claims, whether or not arising out of… employment, 27 1 347–48; and (3) survived indefinitely following the plaintiff’s termination, see id. at 347. 2 As to the first, the Agreement includes inconsistent language about its scope. The first 3 section of the Agreement defines “Covered Disputes” as those “arising out of, or in any way 4 related to, your application for and/or employment with the Company—including but not limited to the interview process, background check, employment relationship, or the termination of that 5 relationship (collectively, ‘Covered Disputes’)[.]” Dkt. 17-1, Cohen Decl., Ex. E § 1. Yet, in the 6 section immediately following, the Agreement reads, “[e]xcept as otherwise provided in this 7 Agreement, Covered Disputes subject to arbitration include, but are not limited to, all past, present 8 and future claims for…,” and then includes a long list of employment and nonemployment-related 9 claims such as, claims for “personal, physical or emotional injury or distress”; “fraud, 10 misrepresentation, defamation, and any other tort or common law claims”; “and violation of any 11 other federal, state or local public policy, constitution, statute, ordinance or regulation.” Id. § 2. 12 Alone, this latter language suggests an impermissibly broad scope. However, unlike Cook, there is 13 no express language including claims “whether or not” they arise out of employment. See Cook, 14 102 Cal.App.5th at 346. Additionally, unlike the defendant in Cook, Defendant here argues that 15 the Agreement is limited to claims relating to an applicant’s candidacy or employment. See id. at 16 344 n.1. In sum, in light of the language in the first section of the Agreement which defines 17 “Covered Disputes” and the limiting language in the second section (i.e., “except as otherwise 18 provided in this Agreement”), see Dkt. 17-1, Cohen Decl., Ex. E, §§ 1, 2, the Agreement’s scope 19 reads as limited to claims related to employment, and thus does not amount to an unconscionable 20 bargain. 21 As for the second two Cook factors, lack of mutuality and unreasonable duration, the case 22 here is closer to that in Cook. DSG must arbitrate covered claims brought against the applicant 23 whereas an applicant/employee must arbitrate any claims brought against DSG as well as “its past 24 or present principals, shareholders, members, directors, officers, employees, agents, 25 representatives, successors and assigns (all of whom may enforce this Agreement).” Id. § 1. The 26 Agreement also “will survive the termination of [the applicant’s] employment and the expiration 27 of any benefit.” Id. § 14. Despite the lack of mutuality and open-ended duration, the Cook factors 1 unconscionability in Cook because it exacerbates the other two factors: an employee lacks 2 mutuality, for all time, for all claims. The Agreement here is readily distinguishable because the 3 scope is, in fact, limited to those related to employment. 4 Plaintiff discusses two other, non-Cook sources of substantive unconscionability. First, Plaintiff argues the Agreement is unconscionable because of a lack of guaranteed discovery. 5 However, as Defendant points out, the JAMS Rules provide for reasonable discovery and the 6 Agreement gives the arbitrator “the authority to order such discovery as he or she considers 7 necessary to a full and fair exploration of the issues in dispute, consistent with the expedited 8 nature of arbitration.” Dkt. 17-1, Cohen Decl., Ex. E, § 8. Second, Plaintiff argues the Agreement 9 is unconscionable because it does not permit “any non-individual representative claims”—those 10 “must be dismissed”— nor does it allow any arbitration decision or award to have preclusive 11 effect in any dispute with a third party.” Id. §§ 8, 10. According to Plaintiff, the effect is wholesale 12 waiver of representative PAGA claims. While likely unconscionable, it does not taint the rest of 13 the Agreement. 14 To the extent the language regarding non-individual representative claims, mutuality, and 15 duration reflect unconscionability, the provisions may be severed, and the Agreement may 16 otherwise be enforced pursuant to the Severability Clause. Unlike in Cook, where scope “tainted” 17 the entire agreement with unconscionability, the unconscionable language here reflects discrete, 18 severable provisions. See Cook, 102 Cal.App.5th at 329 (Severability was not possible because the 19 scope tainted the agreement.); Viking River Cruises, Inc. v. Moriana, 596 U.S. 639, 662 (2022) 20 (Despite a similar PAGA waiver, Defendant “was entitled to enforce the agreement insofar as it 21 mandated arbitration of [plaintiff]’s individual PAGA claim,” reversing the lower courts which 22 had “refused to do so” erroneously “based on the rule,” which the Court found preempted, “that 23 PAGA actions cannot be divided into individual and non-individual claims.”). 24 For the foregoing reasons, the Agreement does not have a sufficient amount of substantive 25 unconscionability to render it unenforceable. Accordingly, the question of formation must be 26 reached. 27 V. FORMATION 1 Under the Federal Arbitration Act (“FAA”), a district court’s role is to determine “(1) 2 whether a valid agreement to arbitrate exists and, if it does, (2) whether the agreement 3 encompasses the dispute at issue.” Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 4 1130 (9th Cir. 2000) (citations omitted). Under California law, a valid contract exists when (1) the parties are capable of contracting, (2) there was mutual consent, (3) the contract had a lawful 5 object, and (4) the contract was supported by sufficient cause or consideration. Cal. Civ. Code § 6 1550. The party seeking to compel arbitration “has the burden of proving the existence of an 7 agreement to arbitrate by a preponderance of the evidence.” Knutson v. Sirius XM Radio Inc., 771 8 F.3d 559, 565 (9th Cir. 2014). 9 Plaintiff here argues he did not consent to the Arbitration Agreement. Under the California 10 Uniform Electronic Transactions Act (“CUETA”), “[a]n electronic record or electronic signature 11 is attributable to a person if it was the act of the person[,]” which “ may be shown in any manner, 12 including a showing of the efficacy of any security procedure applied to determine the person to 13 which the electronic record or electronic signature was attributable.” Civ. Code § 1633.9(a). 14 Defendant argues it has shown that DSG’s database record of consent to the Arbitration 15 Agreement is attributable to Plaintiff. Defendant relies on the declaration of Brad Cohen, Senior 16 Manager of HR Technology Strategy, stating that (1) “[a]pplicants cannot apply” to a DSG 17 position “unless they are logged into their own unique [Workday] account,” Dkt. 17-1, Cohen 18 Decl., ¶ 6; (2) applicants “cannot proceed further until they affirmatively acknowledge receiving 19 and agreeing to the terms of the Arbitration Agreement[,]” id. ¶ 9; (3) “Plaintiff completed th[is] 20 same process.. and could not have applied for a position without creating a Workday account and 21 completing the Arbitration Agreement[,]” id. ¶ 11; and (4) “[a]ccording to DSG’s HRIS system 22 records, Plaintiff used his email address, Mr.tonyramirez2023@yahoo.com as his username, and a 23 unique password that Plaintiff created, to create a Workday account and apply for a position at 24 DSG” and “electronically sign and acknowledge the Arbitration Agreement[,]” id. ¶¶ 11, 13. 25 Often, uncontradicted declarations that an electronic signature could have been placed only 26 by someone using plaintiff’s unique username and password are enough to authenticate an 27 electronic record of assent under CUETA. See e.g., Pliszka v. Axos Bank, No. 24-CV-445-RSH- 1 WL 3754350 (9th Cir. Dec. 29, 2025); Mejia v. Dick's Sporting Goods, Inc., No. 2:25-CV-11645- 2 JFW-MAAX, 2026 WL 796910, at *3 (C.D. Cal. Mar. 18, 2026); Stover-Davis v. Aetna Life Ins. 3 Co., No. 1:15-CV-1938-BAM, 2016 WL 2756848, at *4 (E.D. Cal. May 12, 2016). However, 4 Plaintiff has provided a sworn declaration that contradicts Cohen’s. Ramirez declares (1) he “did not create a Workday account… to submit [his] application” but rather applied by clicking on a 5 link on a social media post advertising the position and filling out the form he was transferred to 6 with his personal information in late October 2024, prior to DSG’s database records, Dkt. 18-1, 7 Ramirez Decl., ¶¶ 3, 6; (2) before being hired, he “did not access, log in to, or use any Workday 8 account[,]” id. ¶ 7; and (3) the hiring representative “provided [him] with the username and 9 password” for a Workday account that DSG “had already created for [him,]” id. ¶ 8. A password 10 which Plaintiff also swears he repeatedly forgot until being told, months later, to change it to 11 something he would remember. Id. By this declaration, Plaintiff has created a factual dispute as to 12 whether he or someone else created his Workday account and took the steps indicating assent to 13 the Arbitration Agreement.1 14 VI. CONCLUSION 15 In light of the material factual dispute regarding consent, Defendant has not met its burden 16 to show by a preponderance of the evidence the existence of an agreement to arbitrate. See 17 Johnson, 57 F.4th at 681. Defendant’s motion to compel is denied. The motions to dismiss/strike 18 and to stay pending arbitration are similarly denied. 19 Having reached the issue of consent and agreeing with Plaintiff as to the existence of a 20

21 1 Defendant has filed a supplemental declaration indicating that someone else cannot set up an 22 account for another person without having access to their email because account set-up requires clicking a link sent to the email associated with the account. Dkt. 19-1, Cohen Supp. Decl. ¶ 5. 23 However, this is insufficient to resolve the factual dispute created by Ramirez’s declaration. He may have clicked the link and yet not created his own account. Moreover, we do not know when 24 in the account creation flow, especially relative to assenting to the Agreement, verification comes. Compare id., with Espejo v. S. California Permanente Med. Grp., 246 Cal. App. 4th 1047, 1062, 25 201 Cal. Rptr. 3d 318, 329 (2016) (Supplemental declaration “detail[ing] [defendant’s] security precautions” and specific applicants steps to show signature could not have been placed by 26 someone without the plaintiff’s unique username and password was sufficient to rebut plaintiff’s declaration that he did not remember signing the agreement.). Defendant even seems unconvinced 27 of its own argument, failing to discuss verification entirely in the Reply, see Dkt. 19, Reply, at 3 (only mention of Cohen Supp. Decl.), or at the hearing held on June 18, 2026. ] material factual dispute, Plaintiff's request under Section 4 of the FAA for a jury trial is relevant. 2 |} See9US.C. § 4. Plaintiff requests a trial as to consent so that a jury can review the evidence, hear 3 || the testimony of Plaintiff, Mr. Cohen (Defendant’s Senior Manger HR Technology Strategy), 4 || Betsy Cruz (the hiring representative Plaintiff alleges provided Plaintiff with his username and 5 || password), and Armen Harutyunyan (Plaintiff's manager who Plaintiff alleges knew his username 6 || and password). The parties are ordered to meet and confer and submit a joint statement by July 10, 7 || 2026 with regards to whether they consent to an evidentiary hearing, in lieu of a jury trial, to 8 || resolve the dispute. 9 10 || ITISSO ORDERED. 1] a 12 Dated: June 23, 2026 13 ICHARD SEEBORG 14 Chief United States District Judge

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