Justia Arbitration & Mediation Opinion Summaries

Olson is a driver for Lyft, whose terms of service include an agreement he could not bring a Private Attorney General Act (PAGA), Labor Code 2698, claim in court, and that disputes with Lyft must be resolved by individual arbitration. Olson sued Lyft alleging six PAGA claims. Lyft petitioned to compel to arbitration. The petition acknowledged that a 2014 precedent (Iskanian) precluded enforcement of PAGA waivers, but asserted that Iskanian was wrongly decided and was no longer good law in light of the U.S. Supreme Court’s 2018 decision, Epic Systems. The trial court rejected Lyft’s arguments.The court of appeal affirmed. Epic Systems addressed the question of whether the NLRA renders unenforceable arbitration agreements containing class action waivers that interfere with workers’ right to engage in “concerted activities.” It did not address private attorney general laws like PAGA or qui tam suit. View "Olson v. Lyft, Inc." on Justia Law

Finch began his employment with Midwest in 2014. His employment agreement stated: “This Agreement shall be construed in accordance with Ohio Law" and that any litigation "must be venued in Franklin County, Ohio.” In 2016, Midwest promoted Finch. The exhibits to the 2014 employment agreement were revised. In 2017 and 2018, Midwest provided Finch with Compensation and Annual Plan letters, revising Finch’s compensation. In 2019, Finch filed this lawsuit in Contra Costa County, alleging violations of the Labor Code for failure to pay his final wages on time and failure to reimburse him for business expenses; violation of Business and Professions Code section 17200; and a cause of action under the Private Attorneys General Act.The court concluded that the 2017 and 2018 Compensation letters modified the 2014 employment agreement. Because these modifications occurred after January 1, 2017, the court concluded they triggered Finch’s Labor Code section 925 right. Section 925 renders a forum selection clause in an employment contract voidable by an employee if the contract containing the clause was “entered into, modified, or extended on or after January 1, 2017.” The court of appeal denied Midwest’s writ petition. Section 925 is triggered by any modification to a contract occurring on or after January 1, 2017. View "Midwest Motor Supply Co. v. Superior Court" on Justia Law

Epstein, an optometrist, entered into a VSP “Network Doctor Agreement.” VSP audited of Epstein’s claims for reimbursement, concluded he was knowingly purchasing lenses from an unapproved supplier, and terminated the provider agreement. The agreement included a two-step dispute resolution procedure: the “Fair Hearing” step provided for an internal “VSP Peer Review.” If the dispute remained unresolved, the agreement required binding arbitration under the Federal Arbitration Act (FAA), under procedures set forth in the policy. A “Fair Hearing” panel upheld the termination.Instead of invoking the arbitration provision, Epstein filed an administrative mandamus proceeding, alleging the second step of the process was contrary to California law requiring certain network provider contracts to include a procedure for prompt resolution of disputes and expressly stating arbitration “shall not be deemed” such a mechanism. (28 Cal. Code Regs 1300.71.38.) He claimed that state law was not preempted by the FAA, citing the McCarran-Ferguson Act, which generally exempts from federal law, state laws enacted to regulate the business of insurance.The court of appeal affirmed the rejection of those challenges. State regulatory law requiring certain network provider agreements to include a dispute resolution process that is not arbitration pertains only to the first step of the dispute resolution process and does not foreclose the parties from agreeing to arbitration in lieu of subsequent judicial review. While the arbitration provision is procedurally unconscionable in minor respects, Epstein failed to establish that it is substantively unconscionable. View "Epstein v. Vision Service Plan" on Justia Law

Defendant YourMechanic, Inc. sought to compel plaintiff Jonathan Provost to arbitrate whether he was an “aggrieved employee” within the meaning of the California Labor Code before he could proceed under the Private Attorneys General Act of 2004 (PAGA) with his single-count representative action alleging various Labor Code violations against company. The Court of Appeal determined that requiring Provost to arbitrate whether he was an “aggrieved employee” with standing to bring a representative PAGA action would have required splitting that single action into two components: an arbitrable “individual” claim and a nonarbitrable representative claim. The Court concluded that a PAGA-only representative action was not an individual action at all, but instead was one that was indivisible and belonged solely to the state. Therefore, YourMechanic could not require Provost to submit by contract any part of his representative PAGA action to arbitration. The trial court therefore properly denied YourMechanic's motion. View "Provost v. YourMechanic, Inc." on Justia Law

In May 2017, plaintiff Joseph Mejia bought a used motorcycle from Defendant DACM, Inc. (Del Amo) for $5,500. Mejia paid $500 cash and financed the remainder of the purchase price with a WebBank-issued Yamaha credit card he obtained through the dealership purchasing the motorcycle. In applying for the credit card, Mejia signed a credit application acknowledging he had received and read WebBank’s Yamaha Credit Card Account Customer Agreement (the credit card agreement), which contained an arbitration provision. Sometime after his purchase, Mejia filed a complaint against Del Amo on behalf of himself and other similarly situated consumers alleging Del Amo “has violated and continues to violate” the Rees-Levering Automobile Sales Finance Act by failing to provide its customers with a single document setting forth all the financing terms for motor vehicle purchases made with a conditional sale contract. The trial court denied Del Amo’s petition to compel arbitration, finding the arbitration provision was unenforceable under McGill v. Citibank, N.A., 2 Cal.5th 945 (2017) because it barred the customer from pursuing “in any forum” his claim for a public injunction to stop Del Amo’s allegedly illegal practices. Del Amo contended the trial court erred in ruling the arbitration provision was unenforceable under McGill, arguing: (1) McGill did not apply because, due to a choice-of-law provision in the contract, Utah law rather than California law governed the dispute; (2) if California law applied, the arbitration provision “does not run afoul of McGill” because Mejia did not seek a public injunction; (3) the arbitration clause was not unenforceable under McGill because the provision did not prevent a plaintiff from seeking public injunctive relief in all fora; and (4) if the arbitration provision was unenforceable under McGill, the Federal Arbitration Act (FAA) preempted McGill and required enforcement of the clause. The Court of Appeal found no merit to any of Del Amo's contentions and affirmed the district court's order. View "Mejia v. DACM Inc." on Justia Law

The lawsuit underlying this appeal involves a "spin-off" of the Fast & Furious franchise, a project ultimately released as Fast & Furious Presents: Hobbs & Shaw (the film), on which Moritz allegedly worked as a producer pursuant to an oral agreement with Universal. After Moritz filed suit for breach of a binding oral agreement regarding Moritz's work on the film, appellants moved to compel arbitration based on arbitration agreements in the written producer contracts regarding Moritz's work for Universal on the Fast & Furious franchise.The Court of Appeal affirmed the trial court's denial of appellants' motion to arbitrate, holding that the arbitration agreements from the Fast & Furious movies did not apply to the Hobbs & Shaw spin-off dispute. The court stated that not only is it not clear and unmistakable here that the parties agreed to delegate arbitrability questions concerning Hobbs & Shaw to an arbitrator, no reasonable person in their position would have understood the arbitration provisions in the Fast & Furious contracts to require arbitration of any future claim of whatever nature or type, no matter how unrelated to the agreements nor how distant in the future the claim arose. The court explained that the Federal Arbitration Act (FAA) requires no enforcement of an arbitration provision with respect to disputes unrelated to the contract in which the provision appears. In this case, appellants' argument that an arbitration provision creates a perpetual obligation to arbitrate any conceivable claim that Moritz might ever have against them is plainly inconsistent with the FAA's explicit relatedness requirement. View "Moritz v. Universal City Studios LLC" on Justia Law

In 2008, appellants Robert and Linda Shivers rented a residential property in La Habra from respondent Wilfred Rivera. Almost seven years later, Rivera filed an unlawful detainer action against the Shivers, alleging they had not paid rent. He later amended his pleading to add causes of action based on the allegation they had damaged the property and taken appliances when they vacated it. The Shivers filed a cross-complaint, alleging Rivera had failed to make repairs to the property and had left it untenantable. The case was originally assigned to limited civil jurisdiction but was later reclassified to unlimited civil. Upon reassignment, the new trial judge ordered counsel to meet and confer regarding the appointment of a referee under Code of Civil Procedure section 638, and a status conference on the subject was scheduled for March 19, 2018. At the status conference, the parties advised the court they could not agree on a referee. The court took the matter under submission, but warned that a referee would be appointed if the parties could not agree on one. Thereafter, in a minute order dated one month later, the trial court, instead of appointing a referee, sua sponte ordered the matter to judicial arbitration. The issue this case presented for the Court of Appeal's review centered on whether the arbitration, originally statutory in nature, morphed into a contractual arbitration as the result of a vague stipulation by counsel for the parties. Neither side ever seemed to have entertained the notion that the completed arbitration was anything but binding, and treated it as such. The trial judge, however, decided on his own that the arbitration was not what the parties intended, a conclusion derived from their actions rather than their explicit words. As a result, the trial court denied the appellants’ petition to confirm, vacated the award, and set a trial date in the case. After review, the Court of Appeal concluded the trial court erred in not confirming the arbitration award and reversed it. View "Rivera v. Shivers" on Justia Law

The Court of Appeal reversed the trial court's order denying the employer's motion to compel arbitration. The court held that the employee demonstrated his assent to the arbitration clause by signing the acknowledgment, and the employer had no duty to call the arbitration agreement to the employee's attention. The court found that provisions in the arbitration clause concerning arbitrator's fees and costs and attorney fees are unenforceable, but they may be severed, and the rest of the agreement is enforceable. Accordingly, on remand, the trial court is directed to sever the offending provisions concerning arbitration fees and costs and attorney fees from the agreement and otherwise grant the motion to compel arbitration. View "Conyer v. Hula Media Services, LLC" on Justia Law

Plaintiffs filed suit against defendants, the property owners, claiming that the property they rented had bed bugs and other problems. The property owners then moved to compel arbitration based on agreements in plaintiffs' leases.The Court of Appeal affirmed the trial court's denial of the property owners' motion for arbitration, holding that state public policy prohibits arbitration provisions in residential lease agreements. The court held that the arbitration agreements in the leases were void under Civil Code 1953, subdivision (a)(4), and that Jaramillo v. JH Real Estate Partners, Inc. (2003) 111 Cal.App.4th 394, and Harris v. University Village Thousand Oaks, CCRC, LLC. (2020) 49 Cal.App.5th 847, 850, specifically identified the right to have a jury trial as a procedural right that may not be waived or modified under section 1953, subdivision (a)(4). View "Williams v. 3620 W. 102nd Street, Inc." on Justia Law

Davis filed sued individual Red Bull executives for age and sexual harassment and hostile work environment in violation of the Fair Employment and Housing Act, and for intentional and negligent infliction of emotional distress. Davis was 56 years old, had been employed by Red Bull for 15 years, and was in a mid-level managerial sales position until he was terminated.Red Bull filed a demand for arbitration with the American Arbitration Association. The individual defendants moved to compel Davis to submit his claims to arbitration. Davis filed a separate lawsuit against Red Bull seeking a declaratory judgment that his claims were not subject to the arbitration agreement. That agreement specifies it is “intended to cover all civil claims which involve or relate in any way to [Davis’s] employment (or termination of employment) with Red Bull, including, but not limited to, claims of employment discrimination or harassment on the basis of . . . sex, age, . . . claims for wrongful discharge, [and] claims for emotional distress.”The trial court concluded and the court of appeal affirmed that the agreement was unconscionable and unenforceable. The court noted the "adhesion" nature of the agreement, which is not mutual and the arbitral discovery process does not guarantee adequate discovery. View "Davis v. Kozak" on Justia Law