Raeda Ensheiwat vs. First American Trust Company

Reply to Opposition

Cal. Super. - 4th Dist.December 13, 2017

l= ] «© 00 ] ~ » ot AH w No - N o N o N o nN nN . N o No -- - -- a -_ A -_ - - - DN 1 Bn w N o - oO © co ~ [0 )] 1 a w N o - 27 28 ROBERT GERARD (SBN 131911) rgerard@fsglawyers.com SALLY COSTANZO (SBN 174459) scostanzo@fsglawyers.com | ELECTRONICALLY FILED FRIEDMAN STROFFE & GERARD, P.C. Superior Court of California, 19800 MacArthur Boulevard, Suite 1100 County of Orange Irvine, California 92612-2425 07/30/2018 at 05:13:00 PM Telephone: (949) 265-1100 Clerk of the Superior Court Facsimile: (949) 265-1199 Bex ElerO Epa Clerk Attorneys for Defendants FIRST AMERICAN TRUST COMPANY; and FIRST AMERICAN TITLE INSURANCE COMPANY SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF ORANGE RAEDA ENSHEIWAT, CASE NO.: 30-2017-00960972-CU-WT-CJ Plaintiff, ASSIGNED FOR ALL PURPOSES TO: HON. NATHAN SCOTT V. DEPT: C12: FIRST AMERICAN TRUST COMPANY; FIRST AMERICAN TITLE INSURANCE COMPANY; and DOES 1 through 100, inclusive, DEFENDANT FIRST AMERICAN TRUST'S REPLY TO PLAINTIFF'S OPPOSITION TO ITS MOTION TO COMPEL ARBITRATION AND DISMISS THE ACTION; OR IN THE ALTERNATIVE, TO STAY THE PROCEEDINGS PENDING ARBITRATION Defendants. DATE: August 6, 2018 TIME: 2:00 p.m. DEPT.: C12 [RESERVATION NO. 72795726 | Complaint Filed: December 13, 2017 N r ” er ” N e ” S e ” N e ” N e ” er ” S e ” Na e” N e ” N e S e ” N a ” N a e ” N e N e ” N a ” S e ” S e S e ” Se e S e S e ” S e ” -1- FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 © © © ~N oO DM ww NN =a N o N o N o N o N o N o nN nN nN _ = -_ -- -_ _ -_ a - - c o ~ l oD 1 Nn w nN - OO LO 0 ~ D [ 7 ] nN w N o - Defendant First American Trust Company (“FA Trust’) submits this Reply in support of its Motion to Compel Arbitration and Dismiss the Action; or in the Alternative, to Stay the Proceedings Pending Arbitration (“Motion”). I. INTRODUCTION. The Court must address two questions in this Motion: (1) whether there is a valid agreement to arbitrate; and if so, (2) whether the agreement encompasses the dispute at issue. Mission Viejo Emergency Medical Assoc. v. Beta Healthcare Group, 197 Cal.App.4th 1146, 1153 (2011); Chiron Corp. v. Ortho Diagnostic Sys. Inc. 207 F.3d 1126, 1130 (9" Cir. 2000). In her Opposition, plaintiff Raeda Ensheiwat (“Ensheiwat”) makes no argument in objection to the latter, thereby conceding the same. Therefore, the Court need only determine whether the Dispute Resolution Agreement (“DRA”) is an enforceable arbitration agreement. | Ensheiwat attempts to advance four arguments to support her contention that the DRA is not a valid arbitration agreement. However, none of these contentions have any legal merit. First, under prevailing law, Ensheiwat agreed to, and remains subject to, the terms of the 2011 DRA. Second, although Ensheiwat contends that she opted out of the 2011 arbitration agreement in its entirety by her 2015 executed Opt Out Form, this is absolutely contradicted by terms of opting out expressly stated in writing directly above her signature on the Opt Out Form. Third, Ensheiwat claims that the 2011 DRA is procedurally unconscionable yet, according to the Armendariz decision she relies upon, as well as other cases and the facts herein, it is not. Fourth, Ensheiwat's contention that the DRA is substantively unconscionable stands solely on her personal and unsupported hypotheses as to what she believes to be unjust, rather than applicable law and established facts. In short, Ensheiwat’s arguments and protests do not alter the fact that both FA Trust and she agreed that the specific forum for the adjudication of any dispute concerning her employment would be binding arbitration. Nor do they negate either or both the Federal Arbitration Act and California law which require that the DRA be 5 FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 -- - [0 0] ~ l D a1 nN w No - oO «O [0 3] ~l oD o1 HN w No = Oo © co ~ oD» oc, NH w No enforced as a binding agreement to arbitrate. Accordingly, FA Trust's Motion should be granted, and this action should be dismissed or, in the alternative, stayed pending resolution of the matter by arbitration. II. CONTRARY TO HER CONTENTION, ENSHEIWAT IS BOUND BY THE | TERMS OF THE 2011 DRA AND IS THUS REQUIRED TO ARBITRATE THIS MATTER . oo i. Ensheiwat’s Inability to Recall Executing the 2011 DRA Does Not Defeat the Evidence Demonstrating her Assent to, or the Enforceability of, the 2011 DRA. Ensheiwat does not dispute FA Trust's showing that the parties entered into a DRA in 2011 or that she received, acknowledged, and understood the terms of the 2011 Agreement including its Section 8 which is entitled, “An Employee's Right to Opt Out of Arbitration.” She also does not refute that Section 8 not only explains the procedure for opting out of the Agreement but expressly states that, “[aln employee {who timely opts out as provided in this paragraph will not be subject to any adverse employment action as a consequence of that decision and may pursue available legal remedies without regard to this Agreement.” Nor does she deny that Section 8 goes on to state that, “Should an Employee not opt out within 30 days of the Employee's receipt of this Agreement, continuing the Employee's employment constitutes mutual acceptance of the terms of this Agreement by Employee and the Company.” Finally, she does not refute that Section 8 advised that she had the right to consult with legal counsel of her choice as to whether she should enter into the DRA. Instead, Ensheiwat simply states that she does not recall signing the 2011 DRA, as if forgetting about it somehow means that she cannot be bound by its terms. Moreover, Ensheiwat's claim that she does not remember signing this Agreement is simply not credible. Nor does it overcome FA Trust's credible, and clear, evidence (as outlined in detail in its moving papers) that she did in fact sign it. Indeed, in Craig v. Brown & Root, Inc., 84 Cal.App.4th 416, 421 (2000), the B= FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930. 1 OS © © ~~ a Or nH w nN N O N O N D N D ND ND M N D 2 a Aa a a aA a a s a a oo ~N O O O N LW O N A O © o o N O O O O o h O N -- Court enforced the employer's arbitration agreement based on a showing that it had mailed the agreement to the employee, the mail had not been returned, and the employee had continued her employment following the mailing. Significantly, it was inconsequential that the employee denied receipt of the agreement. /bid. Similarly, an agreement to arbitrate is binding even if a party failed to read it. See Bolanos v. Khalatian, 231 Cal.App.3d 1586, 1590 (1991). In addition, as explained in Asmus v. Pacific Bell (2000), 23 Cal.a™ 1, 11, California law permits employee policies to become unilateral implied-in-fact contracts by employees’ acceptance of same through their voluntary continuance of employment. | In this case, FA Trust's position for enforcement of the DRA is much stronger than those of the prevailing employers in the foregoing cases. As explained in Ms. Basler's Declaration, there is no question that Ensheiwat did review and acknowledge the DRA since FA Trust's electronic business records expressly show that she did so on October 20, 2011, at 1:32 p.m. EST. Nor is there any question that Ensheiwat continued her employment with FA Trust for years thereafter, thereby again accepting the terms and conditions of the DRA. Finally, although the DRA expressly stated how to opt out of the Agreement (which was the same procedure as stated in the 2015 DRA from. which she did out out), Ensheiwat chose not do so. For all these reasons, Ensheiwat cannot avoid enforcement of a binding agreement simply by claiming she forgot all about it. (Declaration of Plaintiff Raeda Ensheiwat in Support of Plaintiff's Opposition to Defendant's Motion to Compel, 4, page 2, lines 2-3). ii. Ensheiwat Cannot Avoid Enforcement of the 2011 DRA by Opting Out of the 2015 DRA. Just like forgetting that you entered into a binding agreement to arbitrate doesn’t mean that you didn't do so, wanting the completion of the opt-out form to mean that you are not bound by your previously made commitments doesn’t make it so. The Opt-Out Form for the 2015 DRA which Ensheiwat completed and submitted 4- FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 oS © co ~ oD ol RN w No - to the Company, and which she submitted as Exhibit “A” to her Declaration, expressly states in the second paragraph of the four paragraphs immediately above her signature that: If | am already subject to a preexisting First American dispute resolution agreement requiring arbitration, | understand that | cannot opt out of that prior agreement and may only opt out of the revisions that the Dispute Resolution Agreement makes to the preexisting agreement. Accordingly, although Ensheiwat is not bound to the provisions of the 2015 DRA, she remains bound by the 2011 DRA, which is attached as Exhibit A to the Declaration of Elaine Basler. In essence, the effect of the executed 2015 Opt-Out Form is simply that the 2011 DRA Agreement between the parties remains unchanged in its terms and in the obligations required of the parties. Moreover, the fact that Ensheiwat opted out of the 2015 DRA, through the same opt-out process as was offered in the 2011 DRA, demonstrates that her decision to accept the terms and conditions of the 2011 DRA was made knowingly and with the awareness that she had the choice to opt out of that Agreement if she had so desired. iii. The 2011 DRA by which Ensheiwat is Contractually Bound is Not Procedurally Unconscionable. The doctrine of unconscionability refers to “an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party.” Sonic-Calabasas A, Inc. v. Moreno (2013) 57 Cal. 41 1109, 1133. More specifically, procedural unconscionability refers to oppression or surprise due to lack of equal bargaining power. /d. Contrary to Ensheiwat's suggestion, the use of a non-negotiable contract, standing alone, does not support a finding of procedural unconscionability. Lagatree v. Luce, Forward, Hamilton, & Scripps, LLP, 74 Cal.App.4™ 1105, 1127 (1999) (“The cases uniformly agree that a compulsory predispute arbitration agreement is not -5- FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 c - N o N o N o N o N o No N o No A w x -_ Si E N a - -- a - ~ D ol nN w No - oO © <0 ~ D on nN w No - Oo « co ~l xD on Nn w nN No [e o] rendered unenforceable just because it is required as’ a condition. of employment or offered on a ‘take it or leave it basis’). As further explained in AT&T Mobility LLC v. Concepcion (2011) 563 U.S 333, 346-7, contracts of adhesion have become commonplace and the absence of the ability for each employee to separately negotiate an arbitration agreement does not in and of itself make the agreement procedurally unconscionable. | | Contrary to the foregoing, Ensheiwat asserts that “take it or leave it” agreements are unconscionable, citing as examples arbitration agreements that are required as a condition of hire, are non-negotiable, or allow only three days for consideration of the agreement. None of these concerns apply to FA Trust's DRA: Entering into the DRA is not a condition of hire; the Agreement is not “non-negotiable” in that the employee has the choice to accept or reject it (note that requiring an employer with several hundred employees to separately negotiate the specific terms of an arbitration agreement with each employee is both an unworkable and absurd suggestion, as well as would create the opportunity for more aggressive negotiators to get a “better deal’ than their co-workers); the employee has 30 days to make a decision about entering into the DRA; and he or she is expressly advised of the right to seek legal counsel prior to making any decisions about entering into the DRA. And again, as noted previously, the DRA expressly states that there will be no adverse consequences for opting out. Thus, the DRA is a take it or leave it agreement, but what Ensheiwat fails to understand is that there are no repercussions for any employee who decides to leave it. Ensheiwat would have this Court believe that she had no choice but to sign the DRA or she would have lost her job at FA Trust, and this is simply not correct. Many employees have opted out of the DRA and remain happily at work at FA Trust. In addition, the suggestion that the DRA is procedurally unconscionable because the Company did not provide the employee with legal advice as to what may be pros and cons of the Agreement is another unrealistic and inappropriate suggestion. Moreover, First American does provide transparency by advising -6- : FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 ; © © o o ~N O6 6 o r A L N N O N N D ND ND N N DM D N D N A s s a a a a a a a a co ~N O O o r A W N A O OW 0 0 N o o g b w employees that they can seek legal advice before entering into the Agreement. In addition, suggesting that in 2015, Ensheiwat should have been given the opportunity to revoke her pre-existing contractual obligations is equally absurd. Finally, it should be noted that Ensheiwat's contention that First American has the unilateral right to modify its DRA is not true - Ensheiwat was given, and took, the opportunity to reject the 2015 revisions to the original Agreement. iv. Moreover, the 2011 DRA by which Ensheiwat is Contractually Bound Is not Substantively Unconscionable. With regard to substantive unconscionability in employee arbitration agreements, the California Supreme Court detailed the requirements that such agreements must meet to avoid such unconscionability: 1) A neutral arbitrator; 2) Adequate discovery; 3) A written award for purposes of judicial review; 4) Provide for all types of relief that would otherwise be available in court; 5) Payment by the employer of any arbitration fees beyond what the employee would have to pay in court; and 6) Mutuality of obligation. Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4™ 83, 102. As explained in detail in FA Trust's Motion to Compel, the DRA complies in full with each and every requirement set forth above (Motion, page 12, line 19 - page 14, line 17). | | Ensheiwat’s suppositions about a purported “repeat player” effect, her unsupported supposition that FA Trust “repeatedly appears in arbitrations,” and her assumption that arbitrators will unfairly limit right to discovery are simply conjecture to infer adverse circumstances purportedly not present in court in a vain attempt to create substantive unconscionability where in fact none exists. Even so, such conjecture is inaccurate. To the extent that there is a “repeat player” effect, there is no reason to believe it does not exist in the courtroom. in fact, it could be more evident there since litigants don’t have as much choice in venue there as they do with arbitration. In addition, in arbitration, Ensheiwat will be provided more information as to whether FA 7- FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 o © 0 ~N 3 oN HA Ww W nN - N N O N D ND N D N D B ND D N A l e a a a a a a a a co ~l om on Nn w No - oS © co ~ D 1 A w No - Trust or its attorneys have appeared before the arbitrator than she would receive in court due to the disclosures uniquely required of arbitrators to provide such information to the parties at the outset of arbitration to give them the opportunity to select another arbitrator. Moreover, there is no reason to believe that any purported “repeat player” effect does not equally exist for plaintiffs’ counsel who often appear before the same arbitrators. And arbitrators do have, and do exercise, discretion with regard to creating the parameters of discovery specific to each case. ll. ENFORCEABLE ARBITRATION AGREEMENTS ARE FAVORED BY PUBLIC POLICY. | | Finally, it is important to note that, as confirmed in Erickson, Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak Street (1983) 35 Cal.3d 212, 322, California has a “strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution.” See also, Moncharsh v. Heily & Blase (1992) 3 Cal.4" 1, 9; AT & T Mobility LLC v. Concepcion (2011) 563 U.S. 333, 339; Engalla v. Permanente Med. Grp, Inc. (1997) 15 Cal.4™ 951, 971-972 (“California law incorporates many of the basic policy objectives contained in the Federal Arbitration Act, including a presumption in favor of arbitrability and a requirement that an arbitration agreement must be enforced on the basis of state law standards that apply to contracts in general.” Citations omitted.) | IV. CONCLUSION. In sum, FA Trust's DRA complies with applicable California law regarding the requirements for an enforceable arbitration agreement with those employees who voluntarily agree to enter into the DRA. In 2011, Ensheiwat was one of those employees. In 2015, Ensheiwat opted out of changes to the 2011 DRA, but this decision did not change her contractual obligations with regard to the original 2011 DRA. | | FA Trust has complied with all of its legal and contractual obligations with regard to the 2011 DRA, and Ensheiwat should be required to comply with her obligations as -8- FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 oO «© co ~ » 1 A w No - 0 ~ N Oi EA N w N = oO © oo ~ oD [@ 31 nN w No - well. For these reasons, FA Trust respectfully requests that the Court compel Ensheiwat to arbitrate her claims, and dismiss, or in the alternative, stay these proceedings in the Superior Court. DATED: July 30, 2018, FRIEDMAN STROFFE & GERARD, P.C. By /s/ Sally Costanzo Robert Gerard Sally Costanzo Attorneys for Defendants, FIRST AMERICAN TRUST, F.S.B. and FIRST AMERICAN TITLE COMPANY -9- FIRST AMERICAN TRUST"S REPLY BRIEF RE MOTION TO COMPEL ARBITRATION 3858930.1 oO © © NN Oo Oo HM» Ww NN = N O N N D R ND ND N N A a a a a A a s a a a 0 ~ N oO o r A W O N A O © Oo N o oa »~ A 0 0 N D - PROOF OF SERVICE | am employed in the County of Orange, State of California. | am over the age of 18 and not a party to the within action; my business address is 19800 MacArthur Boulevard, Suite 1100, Irvine, California 92612-2425. On July 30, 2018, | served the foregoing document(s) described as follows: DEFENDANT FIRST AMERICAN TRUST'S REPLY TO PLAINTIFF'S OPPOSITION TO ITS MOTION TO COMPEL ARBITRATION AND DISMISS THE ACTION; OR IN THE ALTERNATIVE, TO STAY THE PROCEEDINGS PENDING ARBITRATION on the interested parties in this action by placing [X a true copy [| the original thereof addressed as follows: Marcus A. Mancini, Esq. and Tara Licata, Esq. MANCINI & ASSOCIATES 15303 Ventura Boulevard, Suite 600 Sherman Oaks, CA 91403 Tel: (818) 783-5757 Email: mmancini@mamlaw.net tlicata@mamlaw.net Attorney for Plaintiff [[] (ELECTRONIC SERVICE) (CCP § 1010.6(a)(4)) The parties were electronically served with the document(s) listed above by e-mailed PDF files on July 27, 2018. Electronic service is complete at the time of transmission. My electronic notification address is 19800 MacArthur Blvd., Suite 1100, Irvine, CA 92612; Sonja@fsglawyers.com X (ELECTRONIC SERVICE) (CCP § 1010.6(a)(4)) | caused such document(s) to be electronically served, via One Legal Attorney Service, served on all interested parties in this action shown by Electronic-Filing through One Legal Attorney Service which is then printed and maintained with the original documents in our office. [] (MAIL) (C.C.P. § 1013(a)) Pursuant to CCP § 1013(a) and under firm practice said envelope would be deposited with the U.S. Postal Service on the same day with postage thereof fully prepaid at Irvine, California in the ordinary course of business. | am readily familiar with Friedman Stroffe & Gerard, P.C.'s ordinary business practice of "|| collection and processing correspondence for mailing. | followed this business practice and | placed the envelope for collection and mailing on the date identified above. | am aware that on motion of the party served, service is presumed invalid if postage cancellation date or postage date is more than one day after date of deposit for mailing in affidavit. X (STATE) | declare under penalty of perjury under the laws of the State of California that the above is true and correct. Executed on July 30, 2018, at Irvine, California. /s/ Sonja Neal SONJA NEAL 1 PROOF OF SERVICE 3849158.1