Vinatha Kutagula v. Matterport, Inc. and others

• Court: District Court, N.D. California
• Decided: February 19, 2026
• Docket: 5:25-cv-05383
• Status: Unknown

Opinion

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 NORTHERN DISTRICT OF CALIFORNIA 9

10 VINATHA KUTAGULA, Case No. 25-cv-05383-NC 11 Plaintiff, ORDER GRANTING MOTION 12 TO DISMISS FIRST AMENDED v. COMPLAINT WITH 13 PREJUDICE, COMPEL MATTERPORT, INC., and others, ARBITRATION, AND STAY 14 CLAIMS Defendants. 15 Re: ECF 26 16 17 Plaintiff Vinatha Kutagula asserts nine causes of action against Matterport, Inc. and 18 CoStar Group pertaining to her employment. 19 Before the Court is Defendants’ Motion to Dismiss Plaintiff’s First Amended 20 Complaint (FAC), Compel Arbitration, and Stay Claims. For the reasons below, the Court 21 GRANTS Defendants’ Motion to Dismiss without leave to amend, compels arbitration, 22 and stays Plaintiff’s non-arbitrable claim. 23 I. BACKGROUND 24 A. Factual Background 25 Plaintiff alleges the following. In January 2021, Matterport hired Plaintiff to 26 oversee Sales Operations, Customer Success and Customer Support. FAC ¶ 3. Matterport 27 is a wholly owned subsidiary of CoStar Group. Id. ¶ 5. 1 to the company’s executive team. Id. ¶ 13. Later that year, after reporting SOX violations 2 pertaining to a large deal which closed, Matterport’s chief revenue officer yelled at 3 Plaintiff stating, “I will cut your salary by half and have you go door to door selling.” Id. 4 ¶¶ 14–15. Human resources laughed when Plaintiff reported the comment. Id. ¶ 16. 5 In March 2024, Plaintiff escalated these issues to the CEO. Id. ¶ 24. The executive 6 team created false feedback about Plaintiff’s communication and leadership style, 7 including that she was “aggressive and direct in her communication style, so others felt she 8 was bossy.” Id. ¶ 30, 36. Plaintiff also shared with the CPO that the senior vice president 9 of sales “disparage[d] her, other women . . . and minorities for raising concerns about him 10 and his teams.” Id. ¶ 33. The CPO shouted at Plaintiff for complaining. Id. ¶ 34. Plaintiff 11 told the CEO that the feedback was retaliation for reporting SOX violations, then was 12 immediately terminated. Id. ¶¶ 32, 42. 13 B. Procedural Background 14 In August 2024, Plaintiff filed a complaint in Santa Clara Superior Court asserting 15 claims for unlawful retaliation in and wrongful termination against Matterport, Inc. ECF 16 26-1 at 5. Defendant moved to compel arbitration according to the arbitration agreement. 17 Id. at 22. In December 2024, the Superior Court ruled that the arbitration agreement was 18 enforceable (striking Section 12(f) of the Confidentiality Agreement) and compelled 19 Plaintiff’s claims to arbitration. Id. at 70–71. 20 In June 2025, Plaintiff filed a complaint in federal court against Matterport, Inc. and 21 CoStar Group. ECF 1. Defendants filed a motion to dismiss, compel arbitration, and stay 22 claims. Plaintiff filed a first amended complaint, mooting the motion. ECF 24, 25. 23 Defendants again filed a motion to dismiss the first amended complaint, compel 24 arbitration, and stay claims. Plaintiff opposed. ECF 30. Defendants replied. ECF 40. On 25 February 18, 2026, the Court held a hearing on the motion. ECF 52. 26 The parties have consented to magistrate judge jurisdiction. ECF 7, 10, 11. 27 II. LEGAL STANDARD 1 sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). “To 2 survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as 3 true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 4 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). When 5 reviewing a 12(b)(6) motion, a court “must accept as true all factual allegations in the 6 complaint and draw all reasonable inferences in favor of the non-moving party.” Retail 7 Prop. Trust v. United Bd. of Carpenters & Joiners of Am., 768 F.3d 938, 945 (9th Cir. 8 2014). A court, however, need not accept as true “allegations that are merely conclusory, 9 unwarranted deductions of fact, or unreasonable inferences.” In re Gilead Scis. Secs. 10 Litig., 536 F.3d 1049, 1055 (9th Cir. 2008). A claim is facially plausible when it “allows 11 the court to draw the reasonable inference that the defendant is liable for the misconduct 12 alleged.” Id. If a court grants a motion to dismiss, leave to amend should be granted 13 unless the pleading could not possibly be cured by the allegation of other facts. Lopez v. 14 Smith, 203 F.3d 1122, 1127 (9th Cir. 2000). 15 III. DISCUSSION 16 A. Plaintiff’s Claims Are Subject to the Arbitration Agreement 17 Defendants argue Plaintiff’s second through eighth claims are subject to the 18 arbitration agreement, which covers “any and all claims arising out of or related to 19 [Plaintiff’s] employment.”1 ECF 26 at 8. Plaintiff contends her claims are exempted from 20 arbitration under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment 21 Act (EFAA). ECF 30 at 14. Defendants argue the EFAA does not exempt Plaintiff’s 22 claims because she has not brought a sexual harassment dispute. ECF 40 at 15. 23 Plaintiff’s second through eighth claims must be compelled to arbitration.2 The 24 1 The parties agree that Plaintiff’s whistleblower retaliation claim is not subject to 25 arbitration. ECF 30 at 13; ECF 40 at 14.

26 2 The Court is not persuaded by Plaintiff’s argument that Defendants have waived the right to arbitrate this matter. ECF 30 at 10. While the parties dispute whether Plaintiff has 27 initiated arbitration and the arbitration’s current status (ECF 30 at 10; ECF 40 at 7–8), the 1 Santa Clara Superior Court already concluded that the arbitration agreement is enforceable 2 (apart from section 12(f) of the Confidentiality Agreement, which it struck) and compelled 3 Plaintiff’s then claims to arbitration.3 ECF 26-1 at 70–71. Just because Plaintiff has 4 asserted new claims here, the result is no different. Coyote Valley Band of Pomo Indians 5 v. Findleton, No. 22-cv-00607-JST, 2022 WL 17972173, at *2 (N.D. Cal. Aug. 12, 2022) 6 (federal courts do not have authority to review final determinations of a state court). 7 Plaintiff’s claims still “aris[e] out of or [are] related to [Plaintiff’s] employment,” so the 8 arbitration agreement applies. ECF 26 at 8. 9 Moreover, the EFAA does not exempt Plaintiff’s claims from arbitration. The 10 EFAA allows plaintiffs alleging sexual harassment or assault the means to opt-out of 11 arbitration agreements. 9 U.S.C. §§ 401–402. The EFAA defines a sexual harassment 12 dispute as one “relating to conduct that is alleged to constitute sexual harassment under 13 applicable Federal, Tribal, or State law.” Id. § 401. Here, Plaintiff asserts claims for 14 harassment, discrimination, and retaliation in violation of the California Fair Employment 15 and Housing Act. See FAC generally. Under FEHA, sexual harassment is defined to 16 include “verbal, physical, and visual harassment, as well as unwanted sexual 17 advances.” Cal. Code Regs. tit. 2, § 11034(f). “Courts look to the totality of the 18 circumstances to determine whether harassment is severe or pervasive enough to alter the 19 workplace environment.” Van De Hey v. EPAM Sys. Inc., No. 24-cv-08800-RFL, 2025 20 WL 829604, at *4 (N.D. Cal. Feb. 28, 2025) (citations omitted). “[O]ffhand comments[ ] 21 and isolated incidents (unless extremely serious) are not sufficient to create an actionable 22 claim of harassment.” Id. 23 Plaintiff’s allegations, while concerning if true and may describe sex discrimination, 24 do not plausibly allege a sexual harassment claim. Plaintiff alleges her team was moved 25 under a while male leader and she was disparaged for raising concerns and singled out. 26 3 The Court grants Defendants’ request for judicial notice of court documents already in 27 the public record and documents filed in other courts. ECF 26-2; Love v. Marriott Hotel 1 FAC ¶¶ 12, 33, 34, 35. The FAC does not allege that Plaintiff, for example, “was 2 subjected to unwelcome sexual advances or experienced ‘epithets, derogatory comments or 3 slurs’ on the basis of her gender.” Johannessen v. JUUL Labs, Inc., No. 3:23-cv-03681- 4 JD, 2024 WL 3173286, at *4 (N.D. Cal. June 24, 2024) (quoting 2 Cal. Code Regs. § 5 11019(2)). Nor does the FAC allege “physical or visual harassment of a sexual nature.” 6 Id. “Personnel actions such as ‘hiring and firing, job or project assignments, . . . the 7 assignment or nonassignment of supervisory functions, deciding who will and who will not 8 attend meetings, . . . and the like, do not come within the meaning of harassment.’” Id. 9 (quoting Janken v. GM Hughes Elecs., 46 Cal. App. 4th 55, 64–65 (1996)). While her 10 claims may be viable, Plaintiff has not alleged sufficient facts regarding the disparaging 11 comments for the Court to conclude they were “severe or pervasive enough to alter the 12 workplace environment” for the EFAA to apply. Van De Hey, 2025 WL 829604 at *4. 13 Accordingly, the Court grants Defendants’ motion and compels Plaintiff’s claims to 14 arbitration. 15 B. Plaintiff’s SOX Claim Will Be Stayed Pending Arbitration 16 Defendants contend the Court should stay Plaintiff’s SOX claim pending arbitration 17 because it will simplify the proceedings. ECF 26 at 16–17. Plaintiff argues her SOX 18 claim should not be stayed because her non-arbitrable claims predominate those compelled 19 to arbitration. ECF 30 at 17. 20 A district court retains discretion whether to proceed with or stay non-arbitrable 21 claims and litigation “in the interest of saving time and effort for itself and litigants.” 22 Wilcox v. Ho-Wing Sit, 586 F. Supp. 561, 567 (N.D. Cal. 1984). “Where a stay is 23 proposed, the court should weigh the competing interests that will be affected, including: 24 the possible damage which may result from granting the stay, the hardship or inequity 25 which a party may suffer in being required to go forward, and ‘the orderly course of justice 26 measured in terms of the simplifying or complicating of issues, proof, and questions of law 27 which could be expected to result from a stay.’” Congdon v. Uber Techs., Inc., 226 F. 1 CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962)). 2 The Court finds it appropriate to stay Plaintiff’s SOX claim and the entire action 3 because, as Plaintiff admits, “the very core of her case is embodied in these non-arbitrable 4 SOX and FEHA causes of action” which are “inextricably linked.” ECF 30 at 17. As 5 such, allowing the arbitration to resolve first will simplify future proceedings of her SOX 6 claim. See Anderson v. Salesforce.com, Inc., No. 18-cv-06712-PJH, 2018 WL 6728015, at 7 *3 (N.D. Cal. Dec. 21, 2018) (staying SOX claim pending arbitration where it would 8 streamline questions of fact and issues of law); Luong v. Super Micro Computer, Inc., No. 9 24-cv-02440-BLF, 2024 WL 4681605, at *6 (N.D. Cal. Nov. 4, 2024) (same). 10 Accordingly, the Court grants Defendants’ motion to stay the action pending arbitration. 11 C. Plaintiff’s Ninth Claim for Declaratory Relief is Improper 12 Plaintiff’s ninth cause of action for declaratory relief asserts that the arbitration 13 agreement is unenforceable because “it lacks mutuality, is procedurally and substantively 14 unconscionable, and violates public policy.” FAC at 26. Defendants argue this cause of 15 action is a “de facto appeal” of the state court’s holding that the arbitration agreement is 16 enforceable. ECF 26 at 12 n.4. Plaintiff contends that the agreement is invalid as to the 17 “new, non-arbitrable causes of action brought in this lawsuit.” ECF 30 at 16–17. 18 The Santa Clara Superior Court has already concluded that the arbitration 19 agreement is enforceable (apart from section 12(f) of the Confidentiality Agreement). 20 ECF 26-1 at 70–71. “The United States District Court, as a court of original jurisdiction, 21 has no authority to review the final determinations of a state court in judicial proceedings.” 22 Coyote Valley Band of Pomo Indians 2022 WL 17972173, at *2 (quoting Worldwide 23 Church of God v. McNair, 805 F.2d 888, 890 (9th Cir. 1986)). This Court cannot now 24 reverse the state court’s decision and find that the arbitration agreement is unenforceable. 25 If Plaintiff is dissatisfied with the lower court’s decision, she would have to appeal to a 26 higher state court rather than challenge that action here. Id. Accordingly, the Court grants 27 Defendants’ motion to dismiss Plaintiff’s ninth claim for declaratory judgment without 1 D. Plaintiff Fails to State a Claim against CoStar 2 Defendants contend Plaintiff's claims against CoStar are subject to dismissal 3 || because all require an employer-employee relationship and Plaintiff was never employed 4 || by CoStar. ECF 26 at 18-19. CoStar acquired Matterport a year after Plaintiff's 5 || termination. /d. at 19. Plaintiff contends CoStar can be liable under a successor liability 6 || theory. ECF 30 at 18-19. 7 Plaintiff has failed to plausibly allege a claim against CoStar. As Defendants note, 8 || Plaintiff has not alleged “she was employed by CoStar or that CoStar took employment 9 || actions against her.” ECF 26 at 19. If Plaintiff is entitled to any recovery, “[s]he will have 10 || aremedy against [Matterport] and need not draw extraneous parties into this suit.” 11 Lindsey v. United Airlines, Inc., No. C 17-00753 WHA, 2017 WL 2404911, at *5 (N.D. = 12 |} Cal. June 2, 2017) (granting motion to dismiss where plaintiff failed to establish parent 13 |} company’s liability for subsidiary). Moreover, CoStar is not Matterport’s successor, so C 14 || lability cannot be attached. ECF 40-2. Accordingly, the Court grants Defendants’ motion 3 |} to dismiss claims against CoStar without leave to amend. 16 || IV. CONCLUSION 5 17 Accordingly, Defendants’ Motion to Dismiss Plaintiff's ninth claim and claims 5 18 |} against CoStar, Compel Arbitration, and Stay Claims is GRANTED. Because the Court 19 || finds that it would be futile, leave to amend is denied. 20 All further proceedings in this matter are stayed until arbitration is completed. The 21 || Court orders the parties to file a joint update and a motion to reopen the case within seven 22 || days after completion of arbitration. 23 24 IT IS SO ORDERED. 25 26 || Dated: February 19, 2026 —> 27 United States Magisirate Judge 28