Opinion
B230274
02-13-2012
VICTOR GALLO, Plaintiff and Respondent, v. YOUBET.COM, INC., Defendant and Appellant.
Ogletree, Deakins, Nash, Smoak & Stewart, P.C., Charles L. Thompson and Michael J. Nader for Defendant and Appellant. Rosa Kwong for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORT
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Los Angeles County
Super. Ct. No. BC437158)
APPEAL from an order of the Superior Court of Los Angeles County, Ronald M. Sohigian, Judge. Reversed and remanded.
Ogletree, Deakins, Nash, Smoak & Stewart, P.C., Charles L. Thompson and Michael J. Nader for Defendant and Appellant.
Rosa Kwong for Plaintiff and Respondent.
Appellant Youbet.com, Inc. appeals an order denying, in part, its motion to compel arbitration of the action filed by respondent Victor Gallo alleging causes of action related to his prior employment as appellant's general counsel. Gallo's employment relationship with appellant was governed by a written agreement containing an arbitration clause. The trial court granted appellant's motion to compel arbitration of Gallo's first cause of action for failure to pay wages in violation of California Labor Code section 201; his second claim for wrongful termination in violation of California Labor Code section 98.6; and the fifth cause of action for breach of employment contract.Nonetheless, the lower court, without expressing its rationale for doing so, denied the motion to compel arbitration of the third cause of action for religious discrimination in violation of the California Fair Employment and Housing Act ("FEHA") and fourth cause of action for retaliation and wrongful discharge in violation of FEHA.
Gallo has not sought review of the court's order granting arbitration of these causes of action, nor has he sought review of his complaint regarding the payment of certain arbitration fees.
Before this court, appellant contends that the trial court did not have the power or jurisdiction to decide the issue of arbitrability of the FEHA claims, and that instead the parties had clearly and unmistakably agreed pursuant to the employment agreement that the arbitrator would decide whether these claims were subject to arbitration. Appellant also claims the court erred by denying its motion to compel arbitration of the FEHA claims because the claims arose out of and were related to the employment agreement, and thus pursuant to the arbitration clause were subject to arbitration. As we explain, appellant is correct that the parties agreed to allow the arbitrator to decide the scope of the arbitration—that is, whether the claims asserted were subject to arbitration. Consequently, the order denying the motion to compel arbitration of the FEHA claims is reversed and the matter is remanded.
FACTUAL AND PROCEDURAL BACKGROUND
A. Gallo's Employment Agreement.
Appellant is a company that provides technology and pari-mutuel horse-racing content for consumers through Internet and telephone platforms.
Gallo is an attorney. In March 2003, he joined appellant as General Counsel for the company. At the time, Gallo signed an employment agreement which specifically described all terms and conditions of his employment, including the location of his employment, his duties, the term of employment, his salary, eligibility for bonuses and stock options, benefits and grounds for termination. The agreement also included the following arbitration clause:
Any dispute whatsoever arising out of or referable to this Agreement, including, without limitation, any dispute as to the rights and entitlements and performance of the parties under this Agreement or concerning the termination of Executive's employment or of this Agreement or its construction or its validity or enforcement, or as to the arbitrator's jurisdiction, or as to the ability to arbitrate any such dispute, shall be submitted to final and binding arbitration in Los Angeles, California, by and pursuant to the Labor Arbitration Rules of the American Arbitration Association with discovery proceedings pursuant to Section 1283.05 of the California Code of Civil Procedure. The arbitrator shall be entitled to award any relief, which might be available at law or in equity, including that of a provisional, permanent or injunctive nature. The prevailing party in such arbitration as determined by the arbitrator, or in any proceedings in respect thereof as determined by the person presiding, shall be entitled to receive its or his reasonable attorneys' fees incurred in connection therewith.
In late April 2004, Gallo and appellant entered into another written employment agreement. This agreement designated Gallo as the General Manager, Director, and Chief Legal Officer of a subsidiary referred to as "Youbet Nevada, Incorporated." This second Employment Agreement included the same arbitration clause found in the Employment Agreement he signed in March 2003. For the purposes of this appeal both agreements are collectively referred to as the "Employment Agreement."
B. Gallo's Termination and Arbitration Proceedings.
Gallo's employment with appellant ended in April 2009. In early July 2009, he filed a demand for arbitration with the American Arbitration Association ("AAA"), asserting three claims: (1) failure to pay wages in violation of the California Labor Code; (2) breach of contract; and (3) breach of the covenant of good faith and fair Dealing. In Gallo's demand for arbitration, he alleged that AAA has jurisdiction to hear the claim, and explicitly invoked the arbitration clause in the Employment Agreement.
Before AAA had appointed an arbitrator, Gallo propounded written discovery on appellant, including, special and form interrogatories, document requests, and requests for admissions. Thereafter, Gallo objected to the appointment of the original arbitrator designated by AAA. In October 2009, AAA granted Gallo's request and appointed former Los Angeles County Superior Court Judge Richard P. Byrne as arbitrator. Gallo did not move at this time to disqualify Judge Byrne.
In November 2009, the parties agreed to arbitrate pursuant to AAA Employment Dispute Arbitration Rules. After a management conference with the parties, Judge Byrne prepared a management conference report and scheduling order confirming that all California discovery rules would apply, that Judge Byrne had authority to issue subpoenas and setting dates for dispositive motions to be heard and for the actual arbitration. The order also stated that the arbitration would be conducted pursuant to the AAA Labor Arbitration ("AAA Rules").
In the fall of 2009 and early spring of 2010, Gallo continued to participate in discovery. However, in late March 2010, Gallo sought to disqualify Judge Byrne. AAA denied his request for disqualification in mid-April. On April 16, 2010, four days after AAA rejected Gallo's motion to disqualify Judge Byrne, Gallo informed AAA that he would be filing a civil complaint in superior court. On April 30, 2010, Gallo formally withdrew from arbitration.
C. Gallo's Civil Action and Appellant's Motion to Compel Arbitration.
In May 2010, Gallo filed a complaint in Superior Court (the "Complaint"). The Complaint included two claims that he earlier had submitted to arbitration: failure to pay wages in violation of the California Labor Code (First Cause of Action) and breach of employment contract (Fifth Cause of Action). The Complaint also included three new causes of action: wrongful termination in violation of public policy in violation of California Labor Code section 98.6 (Second Cause of Action); religious discrimination in violation of FEHA (Third Cause of Action); and retaliation and termination in violation of FEHA (Fourth Cause of Action). With respect to his FEHA claims, appellant alleged that his employment was terminated because he was not Jewish, and that appellant had engaged in a practice of retaining and replacing gentile employees, including appellant with persons of the Jewish faith. He further alleged that the appellant retaliated against him when he complained about what he saw as the pattern and practice of religious discrimination favoring Jewish employees.
California Labor Code section 98.6 prohibits an employer from discharging and/or discriminating against an employee who engages in certain conduct set forth in the Labor Code.
Appellant's answer to the complaint included an affirmative defense that expressly raised Gallo's obligation to arbitrate his claims.
In July 2010, appellant demanded in writing that Gallo arbitrate all five causes of action. Gallo rejected the arbitration demand.
In September 2010, appellant filed a motion to compel arbitration, arguing that the arbitration provision in the Employment Agreement governed each cause of action. Appellant also sought an award of attorneys' fees pursuant to a section 15 of the Employment Agreement. In opposition, Gallo conceded that his wage and contract claims (First and Fifth Causes of Action) were "indisputably covered by the Arbitration Agreement." He did not argue that the Arbitration Agreement was unconscionable or unenforceable but instead contended that the Arbitration Agreement was not broad enough to cover his FEHA Claims, and that appellant had not reimbursed his arbitration fees.
In its order, the lower court granted appellant's motion to compel arbitration with respect to the First, Second and Fifth causes of action. But the trial court denied the motion to compel arbitration with respect to his Third Cause of Action for FEHA religious discrimination and Fourth Cause of Action for FEHA wrongful termination/retaliation. The trial court did not issue a written rationale for its ruling, nor did the court orally explain its rationale at the hearing on the motion. This appeal followed.
DISCUSSION
Before this court, appellant argues that the lower court erred in denying its motion to compel arbitration of all of the causes of action asserted in Gallo's complaint. Specifically, appellant asserts that under the arbitration agreement, Gallo and appellant agreed that the arbitrator would have the authority to decided which claims would be subject to arbitration, and that the lower court should have stayed the action to allow the arbitrator to determine the arbitability of the issues. In any event, appellant also asserts that the FEHA claims were subject to arbitration and thus, the motion to compel arbitration of all causes of action should have been granted.
I. Arbitration Generally and Standard of Appellate Review
"California law, like federal law, favors enforcement of valid arbitration agreements. [Citation.]" (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 97.) Code of Civil Procedure section 1280 et seq. sets forth "a comprehensive statutory scheme regulating private arbitration in this state." (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 9.) "Through this detailed statutory scheme, the Legislature has expressed a 'strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution.' [Citations]. Consequently, courts will '"indulge every intendment to give effect to such proceedings."' [Citations.]" (Ibid.) "In cases involving private arbitration, '[t]he scope of arbitration is . . . a matter of agreement between the parties' [citation], and '"[t]he powers of an arbitrator are limited and circumscribed by the agreement of stipulation of submission."' [Citations.]" (Id. at pp. 8-9.) Section 1281 provides: "A written agreement to submit to arbitration an existing controversy or a controversy thereafter arising is valid, enforceable and irrevocable, save upon such grounds as exist for the revocation of any contract." "California has a strong public policy in favor of arbitration and any doubts regarding the arbitrability of a dispute are resolved in favor of arbitration. [Citations.]" (Coast Plaza Doctors Hospital v. Blue Cross of California (2000) 83 Cal.App.4th 677, 686.) In fact, the burden is on the party opposing arbitration, to show that the arbitration clause cannot be interpreted to cover the claims in the complaint. (EFund Capital Partners v. Pless (2007) 150 Cal.App.4th 1311, 1321; Buckhorn v. St. Jude Heritage Medical Group (2004) 121 Cal.App.4th 1401, 1406.)
All statutory references are to the Code of Civil Procedure unless otherwise specified.
However, "[t]here is no public policy favoring arbitration of disputes which the parties have not agreed to arbitrate. [Citation.]" (Engineers & Architects Assn. v. Community Development Dept. (1994) 30 Cal.App.4th 644, 653.) "The scope of arbitration is, of course, a matter of agreement between the parties. . . ." "In the absence of indication of contrary intent, and where the arbitration clause is reasonably susceptible of such an interpretation, claims . . . will be deemed subject to arbitration." (Ericksen, Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak Street (1983) 35 Cal.3d 312, 323.)
"Private arbitration is a matter of agreement between the parties and is governed by contract law. [Citation.] Arbitration agreements are to be construed like other contracts to give effect to the intention of the parties. [Citation.]" (Crowell v. Downey Community Hospital Foundation (2002) 95 Cal.App.4th 730, 734.) "When deciding whether the parties agreed to arbitrate a certain matter . . . , courts generally . . . should apply ordinary state-law principles that govern the formation of contracts." (First Options of Chicago, Inc. v. Kaplan (1995) 514 U.S. 938, 944.) "Ordinary rules of contract interpretation apply to the arbitration clause. [Citations.]" (Maggio v. Windward Capital Management Co. (2000) 80 Cal.App.4th 1210, 1214-1215, fn. omitted.) "The fundamental goal of contractual interpretation is to give effect to the mutual intention of the parties. (Civ. Code, § 1636.) If contractual language is clear and explicit, it governs. (Civ. Code, § 1638.)" (Bank of the West v. Superior Court (1992) 2 Cal.4th 1254, 1264.) "The court should attempt to give effect to the parties' intentions, in light of the usual and ordinary meaning of the contractual language and the circumstances under which the agreement was made." (Weeks v. Crow (1980) 113 Cal.App.3d 350, 353.)
A petition to compel arbitration is simply a suit in equity seeking specific performance of that contract. [Citations.]" (Engineers & Architects Assn. v. Community Development Dept., supra, 30 Cal.App.4th at p. 653.) Section 1281.2 provides: "On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists . . . ."
When there is no conflicting extrinsic evidence, we apply a de novo, or independent, standard of review on appeal from a trial court's determination of the issue of whether an arbitration agreement applies to a particular controversy. (Fitz v. NCR Corp. (2004) 118 Cal.App.4th 702, 711; Brookwood v. Bank of America (1996) 45 Cal.App.4th 1667, 1670 ["Whether an arbitration agreement applies to a controversy is a question of law to which the appellate court applies its independent judgment where no conflicting extrinsic evidence in aid of interpretation was introduced in the trial court."]; Vianna v. Doctors' Management Co. (1994) 27 Cal.App.4th 1186, 1189; Patterson v. ITT Consumer Financial Corp. (1993) 14 Cal.App.4th 1659, 1663 [When "there is no evidence extrinsic to the contract or no conflict in the extrinsic evidence or the conflicting evidence is entirely written, a reviewing court is not bound by the finding of the trial court, but instead subjects the contract to independent review. [Citation.]"].) The critical issue in this case turns on the interpretation of the Employment Agreement, particularly the arbitration provision. Because there is no factual dispute as to the language of the provision, this court conducts a de novo review. (Coast Plaza Doctor's Hospital v. Blue Cross of California, supra, 83 Cal.App.4th at p. 684.) More specifically, under this standard, the determination of whether the parties clearly and unmistakably intended the arbitrator to decide issues of arbitrability is a question of contract interpretation, which is an issue we review de novo. (Dream Theater, Inc. v. Dream Theater (2004) 124 Cal.App.4th 547, 551.)
II. Authority to Decide the Issue of Arbitrability
Appellant contends the trial court did not have the power or jurisdiction to decide the issue of arbitrability of Gallo's FEHA causes of action. It asserts that pursuant to the arbitration provision in the Employment Agreement an arbitrator, not a court, must decide the threshold issue of arbitrability of these claims. We agree.
"The issue of who should decide arbitrability turns on what the parties agreed in their contract. [Citations.]" (Dream Theater, Inc. v. Dream Theater, supra, 124 Cal.App.4th at p. 551.) In AT & T Technologies v. Communications Workers (1986) 475 U.S. 643, the Court set forth two principles: (1) "'arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.' [Citations.]"; and (2) the threshold issue of arbitrability is for the court to decide, "[u]nless the parties clearly and unmistakably provide otherwise." (Id. at pp. 648-649.) In First Options of Chicago, Inc. v. Kaplan, supra, 514 U.S. 938, the Court restated the principle that the issue of arbitrability may be referred to the arbitrator only if there is clear and unmistakable evidence from the arbitration agreement, as construed by the relevant state law, that the parties intended the question of arbitrability to be decided by the arbitrator. (Id. at p. 944.) First Options stated:
Courts should not assume that the parties agreed to arbitrate arbitrability unless there is "clea[r] and unmistakabl[e]" evidence that they did so. [Citations.] In this manner the law treats silence or ambiguity about the question "who (primarily) should decide arbitrability" differently from the way it treats silence or ambiguity about the question "whether a particular merits-related dispute is arbitrable because it is within the scope of a valid arbitration agreement" - for in respect to this latter question the law
reverses the presumption. [Citations.] [¶] But, this difference in treatment is understandable. The latter question arises when the parties have a contract that provides for arbitration of some issues. In such circumstances, the parties likely gave at least some thought to the scope of arbitration. And, given the law's permissive policies in respect to arbitration [citation], one can understand why the law would insist upon clarity before concluding that the parties did not want to arbitrate a related matter. [Citation.] On the other hand, the former question - the "who (primarily) should decide arbitrability" question - is rather arcane. A party often might not focus upon that question or upon the significance of having arbitrators decide the scope of their own powers. [Citations.] And, given the principle that a party can be forced to arbitrate only those issues it specifically has agreed to submit to arbitration, one can understand why courts might hesitate to interpret silence or ambiguity on the "who should decide arbitrability" point as giving the arbitrators that power, for doing so might too often force unwilling parties to arbitrate a matter they reasonably would have thought a judge, not an arbitrator, would decide. [Citation.] (First Options of Chicago, Inc. v. Kaplan, supra, 514 U.S. at pp. 944-945.)
Our state courts have adopted that principle. California common law is settled that parties to an arbitration contract must clearly and unmistakably agree an arbitrator has the power to decide his or her own jurisdiction; otherwise the question of whether an arbitrator has jurisdiction is for the court to resolve. (United Public Employees v. City & County of San Francisco (1997) 53 Cal.App.4th 1021, 1026 ["Unless the parties clearly and unmistakably provide otherwise, the question of whether the parties agreed to arbitrate is to be decided by the court, not the arbitrator. The court also determines what issues are subject to arbitration."]; Engineers & Architects Assn. v. Community Development, supra, 30 Cal.App.4th at pp. 652-653 ["Unless the parties clearly and unmistakably provide otherwise, the question of whether the parties agreed to arbitrate is to be decided by the court, not the arbitrator."]; Dream Theater, Inc. v. Dream Theater, supra, 124 Cal.App.4th at p. 552 (Dream Theater) ["the question of arbitrability is for judicial determination '[u]nless the parties clearly and unmistakably provide otherwise'"]; Baker v. Osborne Development Corp. (2008) 159 Cal.App.4th 884, 893-894 ["we conclude the arbitration agreement did not 'clearly and unmistakably' reserve to the arbitrator the issue of whether the arbitration agreement was enforceable"]; Century 21 Chamberlain & Associates v. Haberman (2009) 173 Cal.App.4th 1, 10 ["Generally, the court must determine whether a dispute is subject to contractual arbitration, unless the parties clearly and unmistakably agree otherwise."].)
California courts also recognize that "'arbitrability' is an ambiguous term that can encompass multiple distinct concepts." (See Bruni v. Didion (2008) 160 Cal.App.4th 1272, 1286.) Courts look to the precise nature of the claim that the party resisting arbitration is making. If it is claiming that it never agreed to the arbitration clause at all—e.g., if it is claiming forgery or fraud in the factum—then the court must consider that claim. On the other hand, if it is not denying that it agreed to the arbitration clause, but instead it is claiming some other defense to enforcement of the arbitration clause— e.g., illegality or fraud in the inducement—then the court must enforce the "arbitrability" portion of the arbitration clause by compelling the parties to submit that defense to arbitration. (Id. at p. 1287.) Likewise, as the court in Dream Theater recognized, the parties can agree to have "arbitrability"—in the sense of the scope of the arbitration provisions—decided by the arbitrator. Here, Gallo is not challenging the validity or enforceability of the Employment Agreement or the arbitration provision in the agreement. In this case, the dispute centers only on the scope of the arbitration agreement.
In Shaw Group Inc. v. Triplefine Intern. Corp. (2d Cir. 2003) 322 F.3d 115, the court vacated an injunction prohibiting arbitration of certain claims, finding the parties' contract clearly and unmistakably showed an intent to arbitrate issues of arbitrability. (Id. at pp. 121-125.) The arbitration clause in Shaw provided that the parties agreed to submit all disputes concerning or arising out of their representation agreement to "'the International Chamber of Commerce [ICC] . . . in accordance with the rules and procedures of International Arbitration.'" (Id. at p. 122.) Finding those rules "assign[ed][to] the arbitrator initial responsibility to determine issues of arbitrability," Shaw concluded "the agreement clearly and unmistakably evidences the parties' intent to arbitrate questions of arbitrability." (Id. at p. 125.) Shaw also stated: "Because the arbitration agreement at issue in this case provides for all disputes between the parties to be referred to the [ICC], and because the rules of that organization expressly provide for the International Court of Arbitration ('ICA') to resolve in the first instance any disputes about its own jurisdiction, we conclude that the arbitrability of [the claim] was a question for the arbitrator rather than the court." (Id. at p. 118.)
Citing the holding in Shaw, Dream Theater reached a similar conclusion regarding an arbitration clause in an asset purchase agreement that incorporated the rules of the Commercial Arbitration Rules of the American Arbitration Association (AAA). (Dream Theater, Inc. v. Dream Theater, supra, 124 Cal.App.4th at pp. 550, 557.) The court stated those rules "specify that the arbitrator will decide disputes over the scope of the arbitration agreement." (Id. at p. 557.) Accordingly, the court concluded "the parties' agreement to arbitrate according to this rule is clear and unmistakable evidence of the intent that the arbitrator will decide whether a Contested Claim is arbitrable." (Ibid.)
The AAA rules provided that the arbitrator "'shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope or validity of the arbitration agreement.'" (Dream Theater, Inc. v. Dream Theater, supra, 124 Cal.App.4th at p. 550.)
Here, the arbitration provision in the Employment Contract, on its face, manifests a clear and unmistakable intent to have the arbitrator determine issues of arbitability. The parties specifically and unambiguously agreed that "[a]ny dispute whatsoever arising out of or referable to this Agreement, . . . as to the arbitrator's jurisdiction, or as to the ability to arbitrate any such dispute, shall be submitted to final and binding arbitration. In our view, this language, standing alone, leaves no doubt that Gallo and appellant intended the arbitrator (rather the court) to decide whether claims arising out of the Employment Agreement are subject to arbitration. This conclusion is bolstered by the fact that Gallo agreed to have the AAA Employment Dispute Resolution rules, which assign issues of arbitability to the arbitrator, apply to his dispute when he originally sought arbitration of his claims against appellant in 2009. Accordingly we agree with appellant that under the arbitration provision in Gallo's Employment Agreement, the issue of whether the FEHA claims were subject to arbitration was a determination for the arbitrator to make rather than the lower court.
Rule 6(a) of the AAA Employment Dispute Arbitration Rules provides, in pertinent part: "The arbitrator shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope or validity of the arbitration agreement."
Because we have concluded that the arbitration clause in Gallo's Employment Agreement manifests a clear and unmistakable intent to delegate the arbitability determination to the arbitrator, our next determination is whether appellant's claim that the FEHA claims are subject to arbitration is "wholly groundless." Even given evidence of such clear and unmistakable intent on the face of a particular arbitration agreement, that principle does not preclude a court from making an initial and limited interpretation of an arbitration agreement to determine whether such clear and unmistakable intent is expressed regarding a particular dispute. Thus where arbitrability of a dispute is itself subject to arbitration, the court should stay proceedings pending the arbitrator's determination of his or her own jurisdiction unless it is "clear that the claim of arbitrability is wholly groundless." (McCarroll v. Los Angeles County District Council of Carpenters (1957) 49 Cal.2d 45, 65.) "This necessarily requires the courts to examine and, to a limited extent, construe the underlying agreement. [Citation.]" (Dream Theater, Inc. v. Dream Theater, supra, 124 Cal.App.4th at p. 553.) Therefore, when a court is faced with a claim that an arbitration agreement clearly and unmistakably requires an arbitrator, and not the court, to decide whether a particular dispute is arbitrable under that arbitration agreement, a court may make an initial and limited examination of the arbitration agreement and the dispute to determine whether the claim that the dispute is arbitrable under that agreement is "wholly groundless." (Ibid.) In effect, a court has the authority to make an initial determination whether the particular dispute could possibly fall within the reasonably arguable scope or boundaries of the arbitration agreement. If the court determines it cannot be reasonably argued a particular dispute is arbitrable under that arbitration agreement (i.e., the claim of arbitrability is wholly groundless), then the court, and not an arbitrator, makes the determination of arbitrability.
Based on the record below in this case, it appears that the trial court did not perform the separate "wholly groundless" inquiry. Neither the written order, nor the court's comments at oral argument reveal any consideration of the issue.
Nonetheless, given that the wholly groundless inquiry in this case does not turn on disputed facts, we address the question in the first instance. In that regard we observe that the arbitration provision broadly covers any disputes as to the "rights, entitlements and performance" of Gallo as well as disputes concerning his "termination." Furthermore, although Gallo alleged his FEHA wrongful termination and retaliation claims in non-specific and broad terms in his complaint, the evidence before this court indicates that in various governmental filings and other documents Gallo previously described the discriminatory conduct as relating to compensation and bonuses—matters governed by the Employment Agreement. This initial and limited examination of the arbitration clause and the nature of the FEHA claims, leads this court to conclude that Gallo's FEHA claims could possibly fall within the reasonably arguable scope or boundaries of the arbitration agreement, and therefore, appellant's claim of arbitrability is not wholly groundless.
Because any inquiry beyond a "wholly groundless" test would invade the province of the arbitrator, whose arbitrability judgment the parties agreed to abide by in the Employment Agreement, we do not determine whether the FEHA claims are in fact arbitrable.
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In view of our conclusion, the civil action must be stayed to permit an arbitrator to rule on the arbitrability of those issues.
Finally, appellant has asked this court for an order instructing the lower court to award it attorney's fees pursuant to section 15 of the employment agreement which provides that if either Gallo or appellant "brings an action to enforce [Gallo's] employment agreement, the prevailing party will be entitled to recover its/his reasonable attorneys' fees." Appellant's motion to compel arbitration qualifies as an action to enforce the arbitration provision of the employment agreement. Given our conclusion and disposition, appellant is the "prevailing party" on the motion and is thus entitled to reasonable attorneys' fees incurred in connection with the motion.
DISPOSITION
The order denying appellant's motion to compel arbitration is reversed. This matter is remanded to the lower court to: (1) conduct proceedings to determine the reasonable attorneys' fees to which appellant is entitled and to enter an order awarding such fees to appellant; and (2) thereafter to enter an order staying this action pending the arbitrator's determination of whether the FEHA claims are subject to arbitration. Appellant is entitled to its costs on appeal.
WOODS , J.
We concur:
PERLUSS, P. J.
JACKSON, J.