Justia California Court of Appeals Opinion Summaries

In 2000, plaintiff accepted the Gray law firm’s offer of employment as an associate attorney, including a provision requiring both parties to submit all disputes relating to the employment relationship to binding arbitration. In 2005, Gray merged into DLA Piper. In 2006, plaintiff signed a “Confidential Resignation Agreement and General Release of Claims.” DLA agreed to continue to provide insurance and other benefits until August 2006, when his employment would officially terminate. The Termination Agreement is silent concerning dispute resolution. Plaintiff later sued, alleging: breach of the implied covenant of good faith and fair dealing; breach of contract; promissory fraud; and constructive fraud, arguing that the firm had “undervalued” his benefits by computing them based on “artificially reduced salary figures.” DLA sought to compel arbitration. Plaintiff asserted the Termination Agreement constituted a novation, extinguishing the arbitration provision, and that even if the provision had survived, claims involving the benefit plan were not subject to arbitration. The court compelled arbitration. In 2013, the arbitrator determined DLA had breached the Termination Agreement and plaintiff had suffered emotional distress, and awarded $41,000 in contract damages plus interest, $45,000 in emotional distress damages, and $7,535.67 in costs. The court of appeal affirmed confirmation of the award. View "Jenks v. DLA Piper Rudnick Gray Cary" on Justia Law

Defendant Westlake Services LLC appealed a trial court order denying its motion to compel arbitration. Alfredo Ramos, and coplaintiffs (who are not parties to this appeal) sued Defendant Westlake Services LLC for causes of actions arising out of their purchase of used automobiles. Ramos alleged that negotiations for his purchase of a car were conducted primarily in Spanish. Defendant charged Ramos money for a “guaranteed auto protection” (GAP) contract to cover the vehicle he purchased. A copy of the GAP contract was not provided to him in Spanish. In exchange for the payment of a premium by the consumer and/or purchaser of the automobile, the ‘GAP’ insurance policy contract, which identifies the respective rights and liabilities of the parties to the contract, is purportedly intended to pay the difference between the actual cash value of the financed automobile and the then-current outstanding balance on the loan for the automobile should the financed automobile be destroyed or ‘totaled’ in an accident. Ramos asserted three causes of action based on Westlake’s failure to provide a translation of the GAP contract: (1) violation of the Consumers Legal Remedies Act (CLRA); (2) violation of section 1632; and (3) violation of the unfair competition law (UCL). Westlake moved to compel arbitration of Ramos’s and his coplaintiffs’ claims, relying on the arbitration provisions contained in the underlying sales contracts they each had signed. Upon review, the Court of Appeal concluded that Ramos reasonably relied on a Spanish translation of the English contract that Pena Motors (as Westlake’s agent) provided him that did not include the arbitration. The Court concluded that mutual assent to the arbitration agreement was lacking, void and that the trial court correctly denied Westlake’s motion to compel arbitration. View "Ramos v. Westlake Services" on Justia Law

Plaintiff filed a putative class action against defendant, asserting statutory violations arising from defendant unlawfully recording and/or monitoring her telephone conversations with defendant's representatives. On appeal, plaintiff challenged the trial court's order compelling arbitration of plaintiff's individual claims and dismissing her class claims. The court concluded that plaintiff's claims fall within the scope of the arbitration agreement and that the arbitration agreement is enforceable, with the exception of one provision that the court found to be unconscionable under the applicable jurisdiction's law. The court concluded that it is possible to sever the unconscionable provision from the remainder of the arbitration agreement and from the contract as a whole. Therefore, the court affirmed the trial court's order compelling arbitration. However, the court reversed the portion of the trial court's order compelling the arbitration of plaintiff's individual claims and dismissing plaintiff's class claims because the parties' agreement delegates to the arbitrator the question whether class arbitration is available under the contract. View "Brinkley v. Monterey Fin. Serv." on Justia Law

After the individual respondents, truck drivers, filed wage claims against Performance, Performance petitioned to compel arbitration based on the arbitration agreements in the "Independent Contractor Agreements" with respondents. The trial court denied the petition, concluding that the agreements were exempt from the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. The court concluded, however, that respondents presented no evidence supporting their argument that the agreements were exempt from the FAA, and the court found that the arbitration provisions were broad enough to cover the claims asserted. The court also concluded that respondents failed to submit any evidence in support of their additional argument that the agreements were unconscionable. Because the trial court erred by denying the petition to compel arbitration, the court reversed the judgment and remanded with directions to grant the petition. View "Performance Team Freight Sys. v. Aleman" on Justia Law

UEBT is a healthcare employee benefits trust governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001, and pays healthcare providers directly from its own funds for the services provided to enrollees in its health plans. UEBT contracted with a “network vendor,” Blue Shield, to obtain access to Blue Shield’s provider network at the rates Blue Shield had separately negotiated, and certain administrative services. One of Blue Shield’s preexisting provider contracts was with Sutter, a group of health care providers in Northern California. UEBT sued Sutter, on behalf of a putative class of all California self-funded payors, alleging that Sutter’s contracts with network vendors, such as Blue Shield, contain anticompetitive terms that insulate Sutter from competition and drive up the cost of healthcare. UEBT sought damages, restitution, and injunctive relief under the Cartwright Act (Bus. & Prof. Code 16720) and California’s unfair competition law (section 17200). Sutter moved to compel arbitration, relying on an arbitration clause in the provider contract signed by Sutter and Blue Shield. The trial court denied Sutter’s motion, concluding that UEBT was not bound to arbitrate its claims pursuant to an agreement it had not signed or even seen. The court of appeal affirmed. View "UFCW & Employers Benefit Trust v. Sutter Health" on Justia Law

Plaintiff filed a class action suit against his employer, alleging various Labor Code violations and unfair business practice. Plaintiff had entered into an agreement with his employer, providing that all disputes arising out of his employment would be resolved by arbitration, and the agreement prohibited class arbitration. The trial court denied the employer's motion to compel arbitration under the test laid out in Gentry v. Superior Court. After the trial court's ruling, the Supreme Court held, in Iskanian v. CLS Transportation Los Angeles, LLC, that Gentry’s rule against employment class waivers was preempted by the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. The court concluded, however, that this matter is not subject to the FAA and that Gentry’s holding has not been overturned under California law in situations where the FAA does not apply. Accordingly, the court found that the agreement’s class waiver provision is unenforceable. Neither party asserts that class arbitration is appropriate. Therefore, the court affirmed the trial court’s order denying the motion to compel arbitration. View "Garrido v. Air Liquide Industrial U.S. LP" on Justia Law

After an arbitrator determined that a non-compete agreement Andrew Gantman signed as a partner in SingerLewak was enforceable, the trial court denied SingerLewak's petition to confirm the award. The trial court found that the non-compete agreement was unenforceable under California law. However, the court concluded that the general rule prohibiting review of an arbitration award was applicable in this case. The court concluded that judicial review of the award was not appropriate in light of the statutory right and public policy exception to the general rule. Accordingly, the court reversed the judgment of the trial court. View "SingerLewak LLP v. Gantman" on Justia Law

Miranda is a former employee of Anderson Enterprises; Hansen is the company’s general manager. During his employment, Miranda signed an “Alternative Dispute Resolution Policy” by which agreed to arbitrate all employment claims and waived the right to arbitrate claims as a class or collective action. In 2013, Miranda filed a purported class action lawsuit, asserting wage and hour claims, including a Private Attorneys General Act (PAGA; Lab. Code, 2698) claim. The trial court found the arbitration agreement valid and enforceable, dismissed the class and representative claims without prejudice based on the arbitration agreement’s waiver, directed Miranda to arbitrate his individual claims, and stayed the superior court proceedings pending completion of arbitration of the individual claims. The court of appeal reversed as to the representative PAGA claim, based on a subsequently-issued California Supreme Court opinion, Iskanian v. CLS Transp. Los Angeles, LLC (2014), under which the waiver is unenforceable. The court noted that Miranda had represented that he would not pursue his individual claims through arbitration and concluded that the PAGA ruling was, therefore, appealable. View "Miranda v. Anderson Enters., Inc." on Justia Law

Plaintiffs Michael Parnow, Shawn Lisenby, Bob Andrade, Gabriel Bautista, and Saiyaz Abdul filed a class action against Universal Protection Service, LP and Universal Services of America, Inc. (collectively, UPS). Plaintiffs worked as armed security guards at the Yolo County Superior Court, under the employ of UPS. As part of their job, they have to provide equipment, such as guns, handcuffs, and radios, and have to pay the costs to maintain their certification to work as armed guards, but they are not reimbursed for equipment or training costs. When they filed an administrative complaint, they were all fired except plaintiff Lisenby, and none were paid their wages. The trial court granted a stipulated stay, pending the outcome of a then-pending case in the California Supreme Court. After the Supreme Court issued its decision, plaintiffs filed an amended complaint as a “representative action” under the Private Attorneys General Act of 2004 (PAGA) and also petitioned to compel class-wide arbitration. The agreement listed a number of disputes that were covered, including “any state or local statutes and ordinances relating to wage and hour or wage payment matters.” It excluded employees covered by collective bargaining agreements, and disputes involving workers compensation and unemployment insurance. UPS answered with a general denial, coupled with various affirmative defenses, including that the class action claims were barred by the arbitration agreement. UPS also filed a cross-complaint seeking a declaration that: (1) the trial court, not the arbitrator, should decide whether class action relief was barred by the arbitration agreement; and (2) that the arbitration agreement barred class actions. After plaintiffs answered the cross-complaint, UPS moved to compel individual arbitration and stay the proceedings. Plaintiffs opposed the motion, in part arguing that under American Arbitration Association (AAA) Rules, whether class arbitrations were permitted was a matter for the arbitrator to decide. Plaintiffs obtained judicial notice of the AAA Rules. The trial court denied the motion to compel individual arbitration, and stayed the suit pending the arbitration. UPS petitioned for a writ of mandate, seeking to set aside the order compelling it to submit to arbitration. Upon review, the Court of Appeal concluded that the agreements’ incorporation by reference of the AAA Rules vested the arbitrator with the power to decide the disputed issue. The alternative writ was discharged, the stay (issued previously) was vacated, and the petition for mandate was denied. View "Universal Protection Service v. Super. Ct." on Justia Law

Carlson sued Home Team, alleging that she was employed as Home’s office manager from February 4, 2013, until her wrongful termination on July 1, 2013. Carlson sought damages for wrongful termination, harassment, breach of her employment agreement, unpaid overtime, retaliation, and intentional infliction of emotional distress. Home moved to compel arbitration, because on Carlson’s first day of work, she was directed to Home’s electronic “onboarding system,” which contained company policies, including Home’s Agreement to Arbitrate. Carlson objected to the Agreement in an email, stating: “I would like to negotiate the terms.” In a conference call with Home’s human resources manager, Carlson asked who would pay for any arbitration and what firm would perform it. The HR Manager began to explain, but Carlson “cut [her] off,” saying that was all the information she needed and she would sign the Agreement. Home’s in-house counsel produced a copy of the Agreement that Carlson “signed electronically,” which was kept in her personnel file.The trial court denied Home’s motion. The court of appeal affirmed, finding the arbitration agreement procedurally and substantively unconscionable, and rejecting contentions that state law unconscionability principles are preempted by the Federal Arbitration Act, 9 U.S.C. 1, and that the courts could sever unconscionable provisions. View "Carlson v. Home Team Pest Defense, Inc." on Justia Law