Karen Valenzuela vs. Kimco Staffing Services, Inc.

Reply Other

Cal. Super. - 4th Dist.January 9, 2018

AN Ln W N CALL & JENSEN A Professional Corporation Mark L. Eisenhut, Bar No. 185039 J. Randall Boyer, Bar No. 290003 610 Newport Center Drive, Suite 700 Newport Beach, CA 92660 Tel: (949) 717-3000 Fax: (949) 717-3100 meisenhut@calljensen.com rboyer@calljensen.com ELECTRONICALLY FILED Superior Court of California, County of Orange 05/24/2018 at 05:24:00 PM Clerk of the Superior Court By Sarah Loose Deputy Clerk Attorneys for Defendant Kimco Staffing Services, Inc. SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF ORANGE - CENTRAL DISTRICT KAREN VALENZUELA, an individual, Plaintiff, VS. KIMCO STAFFING SERVICES, INC., a California corporation; SWIFT TRANSPORTATION CO. OF ARIZONA, LLC, an Arizona limited liability company; and DOES 1 through 20, inclusive, Defendants. KIMO03-04:2204998_1:5-24-18 Case No. 30-2018-00966257-CU-WT-CXC Assigned for all purposes to Hon. Glenda Sanders, Dept. CX101 DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION Date: June 1, 2018 Time: 1:30 p.m. Dept: CX101 Complaint Filed: January 9, 2018 Trial Date: None Set DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N TABLE OF CONTENTS Page LL. INTRODUCTION iss svsss ausssnsvasssnsss avsssvussss sas ovis wie ss 5058 0555356635598 75 65555455005 5535 A455 FUS F008 90 00 555978 d0RFNTS 1 II. SIGNIFICANT EVIDENCE ESTABLISHES THAT PLAINTIFF SIGNED THE ARBITRATION AGREEMENT ........oooiiiiiiiiinie cece cece eer serene sree sarees 2 A. As Plaintiff Challenges The Authenticity Of The Agreement In Her Opposition, Defendant Is Allowed To Present Authentication Evidence IN REPLY ....couuiiiiiiee c e ee see eee as 2 B. Ample Evidence Exists To Authenticate Plaintiff’s Electronic Signature On The Arbitration Agreement ........coceevuiieieereirrieenie eect errs sete evecare seen 3 1 DocuSign Has Already Been Approved By Courts As A Mechanism For Authenticating Electronic Signatures .........c.cccoeeevveeveeneenseeennens 3 2. Plaintiff Provided Individualized Information And Signed Employment Documents Under Penalty Of Perjury Simultaneous With Her Signature On The Arbitration AGIELIMIENIE coi ciieceeet ee eeeeeceeeet ee t ee eeeee es e ee sr ee seteebe estes snes eabe seen ee nae ee 4 3: Kimco’s Recruiter Witnessed Plaintiff Completing The Hire Packet, Including The Arbitration Agreement ...........cccceeeeerveeerieenieeieeneerneeennens 5 C. The Arbitration Agreement Is Valid And Enforceable ...........ccccoviiiiiiiiiniinniiniicecnen. 5 III. THE FAA APPLIES TO THE ARBITRATION AGREEMENT, BUT EVEN UNDER CALIFORNIA LAW, ARBITRATION SHOULD STILL BE COMPELLED otitis eect ete ste eee sees estee eateeeeet ee sate sabe estes nee sree sane enae 6 IV. PLAINTIFF'S OPPOSITION FAILS TO ESTABLISH UNCONSCIONABILITY otitis eters sete cece ee sr esas ese enna sree sarees 7 A. The Arbitration Agreement Is Not Procedurally Unconscionable ............ccceviiiicineennnnnne 7 B. Plaintiff’s Argument That The Agreement Is Substantively Unconscionable And Violates Armendariz Lacks Credibility .........ccccoverviiinnieinnieennnnen. 9 V. IF THE COURT FEELS ADDITIONAL EVIDENCE IS NECESSARY KIMCO REQUESTS LIMITED DISCOVERY AN EVIDENTIARY HEARING otitis eee steer ee sabe sees tee sate sabe ease enna en neennee eas 10 VI. CONCLUSION o.oo eects eee estes sete settee estes sree settee estes saa esre ease enaaeennees 11 KIMO3-04:2204998_1:5-24-18 -i DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION ~N O N n e B A W TABLE OF AUTHORITIES Page Federal Cases Davis v. O'Melveny & Myers, (9th Cir.2007) 485 F.3d 1066 .........oouiiriiiiiieiieeiie eee eters eee sate sees stes snes ens 10 Newton v. American Debt Services, Inc., (N.D. Cal. 2012) 854 F.SUPP.2A T12..cuuiiiieiieetieeeeeee eee ee set sees s es sees eieereeaees 3 Totten v. Kellogg Brown & Root, LLC, (C.D. Cal. 2016) 152 F. Supp. 3d 1243 oot eesti sate sees eee 9,10 State Cases Armendariz v. Found. Health Psychcare Servs., Inc., (2000) 24 Cal. AHI BBucnounmun suas covasmnssmosma swum mss ors wis ons oss ses 00a 66H 55546 45085 HT ERR SEE 7,9, 10 Cione v. Forester Equity Servs., Inc., (19973 38 Cal. APD. AH 02s cows sumsssmommesanunmmmmemn sums svc swmsmmossss esse smmess cuss oss ems 6.880085 S508 03 5 HES S53 7 Engalla v. Permanente Medical Group, Inc., (1997) 15 Cal AME TI] coum oss cncasmmssmonme amunmmmesn sums svc sums oss osm ams ous os sess 6 858s S50 ass ua 6 a8% Sas 7 Espejo v. Southern California Permanente Medical Group, (2016) 246 Cal. AppAth 1047 wu cowsumsssmommssamummmmemnsumss svc sw smmoss s e se spmmess cuss sss 8808s 50am 063846 050085 53 2 Iskanian v. CLS Transp. Los Angeles, LLC, (2014) 39 Cal Ah, 348 courses ammsmommevmmmssn oes cnn summons eres os 6 oS RR RRR 10 Lagatree v. Luce, Forward, Hamilton & Scripps, (1999) LLP, 74 Cal. ADA 1 1005 ssc conus usm omnes iss osm ms sess mas iss eames 7 Lane v. Francis Capital Management LLC, (2014) 224 Cal. APDAE B76 ccs cows swnsssmommmsanunmmmmesn sums svc swmsmmossss esse ssmmsss cums ones sms 6.58085 oC a85548 053 0546 08008% S53 6 Lennar Homes of California, Inc. v. Stephens, (2014) 232, Cal. ADDI B73 wuss cxcasmnssmommmssunmnresn mss css summ ns oss sess ous 166s 59554 $5585 2505 ERE STs STS 7,8 KIMO03-04:2204998_1:5-24-18 - i - DEFENDANT KIMCO STAFFING SERVICES, INC.”S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION ~N O N n e B A W TABLE OF AUTHORITIES (cont’d) Page Madden v. Kaiser Found. Hosps., (1976) 17 Cal.3d 699... eects eer sete eects sree sabe seers 5,6,9 Magno v. The College Network, Inc., (2016) 1 Cal.APP.S 277 oe eects eects sae sabe estes sree saree ene ees 7 Marin Storage & Trucking, Inc. v. Benco Contracting & Engineering, Inc., (2001) 89 Cal. APP.Ath 1042... eects esaeeee bee eeeeeesreesabeeae en eees 5 Mission Viejo Emergency Med. Associates v. Beta Healthcare Group, (2011) 197 CalLAPP-Ath 1146... ee sects sree saree eee eens 5 People v. Valdez, (2011) 201 Cal. APP-Ath 1429 ..cneii eee eeeeeeeeeeeeeteer ees se eeeeeesrae abeeeee ie enna 3 Pinela v. Neiman Marcus Grp., Inc., (2015) 238 Cal. APP.Ath 227... eee eects sae see eee sarees 7 Ruiz v. Moss Bros. Auto Group, Inc., (2014) 232 Cal. APP-Ath 836 .....oiiieiieeiie ete etter sae sees eresaeeeeee ee eees 3 San Francisco Newspaper Printing Co. v. Superior Court, (1985) 170 Cal. APP.3A 438... eects eee eects sae see eee e eee sree sane eee eae en eees 5 Wherry v. Award, Inc., (2011) 192 Cal. APP-Ath 1242 o.oo sree saben eee eee 9 State Statutes Cal. CLV. COE § 1633.7 eee eect eect ete te see eects ste sate sabe e teeta saa eabe eaten eee sree sane enee 3 Cal. Civ. Code § 1633.9(Q) ...ueeriieiieeiieeeeetee reece etter eee eects sate eee estes sees sabe eect ee sree sane eee 3 Cal. Code Civ. Proc. § TOOS(D) cocouueiieieiiiie ieee ieee eesti te ee ette eee tre ee es seae ae ae sansae ae essae ae sessaaeeeesssaeaesnnns 2 Cal. Code Civ. Proc. § 1280 ....ccooiiiiiiiieieeeeeeeeeeeeeee eee 6 Cal. Code Civ. Proc. § 1281 ooo 6 KIMO03-04:2204998_1:5-24-18 - 111 - DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION ~N O N n e B A W TABLE OF AUTHORITIES (cont’d) Page Cal. Code CLV. PTOC. § 1281.2 cee ieee eee eee eee esas teeter esas este teases esse ease seas es esse sesennans 2,7 Cal. Evid. Code § 1400... ... cco eect eee steers eae eee sree sre eae eee sees 3 KIM03-04:2204998_1:5-24-18 -1v - DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N I. INTRODUCTION Plaintiff’s opposition fails to set forth any grounds for a denial of the motion to compel arbitration. Plaintiff’s primary argument-that her signature on the Arbitration Agreement cannot be authenticated-relies on her own vague and potentially perjurious testimony and is both insufficient to defeat the motion and belied by the fact that Plaintiff placed the signature using DocuSign which verified her identity, that Plaintiff provided personally identifying information in her DocuSign forms signed at the same time as the Arbitration Agreement, that Plaintiff specifically agreed to use her electronic signature, that Plaintiff also electronically signed government form documents under penalty of perjury at the same time she signed the Arbitration Agreement, and finally, that Kimco’s recruiter observed Plaintiff completing her DocuSign packet at a computer terminal at the Kimco facility. Plaintiff’s secondary argument-that the agreement was both procedurally and substantively unconscionable-simply parrots her primary argument. With respect to procedural unconscionability, Plaintiff does not attack the terms of the Arbitration Agreement as surprising or oppressive (nor could she), but states that the agreement is unconscionable because she did not sign it and could not have seen it or reviewed it. Again, however, Plaintiff’s testimony is demonstrably false and the evidence overwhelmingly establishes that Plaintiff did see, review, and sign the agreement. The fact that Plaintiff did not review the agreement before signing as instructed does not excuse her from her contractual obligations. Likewise, a party may not avoid contractual obligations by merely denying, through self-serving, testimony that the contract does not exist. Allowing Plaintiff to do so would frustrate the integrity of contract law. Finally, Plaintiff’s sole argument that the agreement is substantively unconscionable is belied by the very case she cites in support. Although the case discusses the PAGA waiver as unenforceable, the court in that case compelled arbitration, holding the PAGA waiver in the arbitration agreement was severable under a savings clause. The Agreement in question here also has a savings clause and the PAGA waiver can be severed from the agreement, while the remainder of the agreement remains enforceable. KIMO03-04:2204998_1:5-24-18 -1- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N Consequently, Plaintiff and Kimco entered into a valid and enforceable Arbitration Agreement. Plaintiff’s employment-related claims fall within the scope of the agreement and under both federal and state law this matter should proceed in arbitration as the parties originally agreed. IL. SIGNIFICANT EVIDENCE ESTABLISHES THAT PLAINTIFF SIGNED THE ARBITRATION AGREEMENT Plaintiff argues that the Motion to Compel Arbitration must be denied because the Motion lacks sufficient evidence to authenticate Plaintiff’s signature. However, Plaintiffs argument misstates the law. Only where a Party raises a challenge to the authenticity of an Arbitration Agreement is any evidence required to fully authenticate the agreement as evidence. (Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, 1060.) As a result, submission of a supplemental declaration in Reply is the proper mechanism to authenticate an Arbitration Agreement. Id.) A. As Plaintiff Challenges The Authenticity Of The Agreement In Her Opposition, Defendant Is Allowed To Present Authentication Evidence In Reply The initial burden borne by Defendant on a motion to compel arbitration under Code Civ. Proc. § 1281.2 is simply to “state...the provisions of the written agreement and the paragraph that provides for arbitration” either verbatim or by attaching the written agreement. (Cal. Rule Ct. 3.1330; Espejo, surpa, 246 Cal.App.4th at 1058.) This burden is established by attaching a copy of the purported agreement to the petition to compel arbitration. (See Espejo, supra, 246 Cal. App. 4th at 1058, 1060.) Thus, by attaching a copy of the purported agreement to its petition to compel arbitration, Kimco satisfied its initial burden to compel arbitration. Establishing the authenticity of a signature is not required until challenged by the plaintiff in opposition to the petition on a motion to compel. (/d. at 1060.) Consequently, where a party challenges the authenticity of his or her signature on the Arbitration Agreement, the party seeking to compel arbitration may then submit a supplemental declaration pursuant to the deadlines set by Code Civ. Proc. § 1005(b) in Reply, fully authenticating the signature. (/d.) KIMO03-04:2204998_1:5-24-18 -2- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N B. Ample Evidence Exists To Authenticate Plaintiff’s Electronic Signature On The Arbitration Agreement “Authentication of a writing means. ..the introduction of evidence sufficient to sustain a finding that it is the writing that the proponent of the evidence claims it is.” (Cal. Evid. Code § 1400.) Moreover, “[l]like any other material fact, the authenticity of a [document] may be established by circumstantial evidence.” (People v. Valdez (2011) 201 Cal.App.4th 1429, 1435.) Under Civ. Code § 1633.7, an electronic signature has the same legal effect as a handwritten signature. “An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable.” (Civ. Code § 1633.9(a) (emphasis added).) 1. DocuSign Has Already Been Approved By Courts As A Mechanism For Authenticating Electronic Signatures Here, Plaintiff placed her electronic signature on the Arbitration Agreement using the software DocuSign. (Declaration of Tania Williams [attached to original Motion] (“Williams Decl.”) { 5, Ex. A.) Courts have recognized that DocuSign, a company providing services for securely and verifiably signing electronic documents, is a valid form of authentication as the Company’s procedures are in compliance with the U.S. Electronic Signatures in Global and National Commerce Act (ESIGN). (Newton v. American Debt Services, Inc. (N.D. Cal. 2012) 854 F.Supp.2d 712, 731, aff’d (9th Cir. 2013) 549 Fed.Appx. 692.) In fact, Ruiz v. Moss Bros. Auto Group, Inc. (2014) 232 Cal. App.4th 836, 845-the very case upon which Plaintiff relies in her argument-mentions DocuSign as an approved method for authenticating electronic signatures. DocuSign is an effective “security procedure applied to determine the person to which the electronic record or electronic signature [is] attributable” (Civ. Code § 1633.9(a)) because Kimco’s hire packet is sent to the specific applicant via the email address that applicant provided in their application. (Declaration of Tammy Burton (“Burton Decl.”) q 8.) The employee opens the document for review, creates a signature, and must click a button saying “Confirm Signing” once they have completed all form fields in the document. (I/d.) Once signed, the signature is assigned an identifying KIMO03-04:2204998_1:5-24-18 -3- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N code-which appears above Plaintiff’s signature on the Arbitration Agreement. (/d.) All of these facts verify the identity of the signer. Kimco sent the hire packet, including the Arbitration Agreement, to Plaintiff using the email address Plaintiff provided in her application, during her hire process. (See Burton Decl. qq 5-8; Declaration of Elena Baglietto (‘“Baglietto Decl.”) | 3.) Kimco can conclude that the signature is Plaintiff’s because it was sent to her email address, she had to use a unique login and password to access the documents for signature, and Plaintiff’s signature, with the identifying code appears on the document. (Burton Decl. { 8; Baglietto Decl. { 3.) 2. Plaintiff Provided Individualized Information And Signed Employment Documents Under Penalty Of Perjury Simultaneous With Her Signature On The Arbitration Agreement Additionally, the Arbitration Agreement was sent in the same packet as several other documents for Plaintiff’s signature further confirming that Plaintiff, and only Plaintiff, could have signed the documents. The first page of the DocuSign packet Kimco sent is an agreement to use an electronic signature. (Burton Decl. { 5, Ex. A.) On this page, Plaintiff provided individualized information, such as her social security number, her driver’s license number, her address, and her telephone number. (/d.) Plaintiff then electronically initialed that she consented to use electronic signatures. (Id.) Further, the DocuSign packet contained a W-4 tax form, as well as an 1-9 authorization form. (Id. at qq 6-7, Exs. B, C.) On both of these forms, Plaintiff provided individualized information including her name, social security number, tax withholding information, and address. (/d.) Plaintiff signed these forms under penalty of perjury. (Id.) Plaintiff’s DocuSign packet further contained her payroll authorization form and health benefits enrollment forms. (Id. at Exs. D, E.) Thus, at the time Plaintiff signed the Arbitration Agreement, she executed employment forms pursuant to which she received her compensation for her employment at the company. All these documents further verify that Plaintiff, and Plaintiff only, completed and signed the documents in the hire packet. KIMO03-04:2204998_1:5-24-18 -4- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N 3. Kimco’s Recruiter Witnessed Plaintiff Completing The Hire Packet, Including The Arbitration Agreement Finally, Plaintiff reviewed and signed the agreements while at the Kimco facility in the presence of her Kimco recruiter. (Baglietto Decl. |] 2-4.) Kimco’s recruiter specifically recalls Plaintiff and the fact that the DocuSign link was sent to Plaintiff’s email address and that Plaintiff signed into DocuSign with her unique login information. (/d.) Kimco’s recruiter personally observed Plaintiff review and sign all documents in the hire packet while she was at a computer at a Kimco facility. (/d.) Thus, there can be no question, that Plaintiff, in fact, signed the agreement. Based on all this evidence, the agreement is what Kimco claims it to be-a valid arbitration agreement existing between it and Plaintiff under which the parties agreed “to use binding arbitration as the sole and exclusive means to resolve all disputes that may arise out of or be related in any way to [Plaintiff’s] employment....” C. The Arbitration Agreement Is Valid And Enforceable Moreover, the fact that Plaintiff signed the agreement is an “outward manifestation” of her assent to the terms of the Agreement. (See, e.g., Marin Storage & Trucking, Inc. v. Benco Contracting & Engineering, Inc. (2001) 89 Cal. App.4th 1042, 1049-1050.) Thus, the Agreement is a valid contract because both parties agreed to it and signed it. Failure to read or understand the arbitration clause is no defense. (See Madden v. Kaiser Found. Hosps., 17 Cal.3d 699, 710 (1976); Mission Viejo Emergency Med. Associates v. Beta Healthcare Group, 197 Cal.App.4th 1146, 1154-55 (2011) (“In California, we adhere to the objective theory of contract law.... Plaintiffs’ argument regarding [defendant’s] lack of knowledge [of the arbitration provision] ignores the objective theory of contract law.... Failing to read a policy ... is not sufficient reason to hold a clear and conspicuous policy provision unenforceable.”); San Francisco Newspaper Printing Co. v. Superior Court, 170 Cal. App.3d 438, 443 (1985) (“failing to read the contract is no excuse, otherwise all contracts of adhesion would be unenforceable at the whim of the adhering party.”)) Plaintiff’s electronic signature is on the Arbitration Agreement. (“Williams Decl.”), Ex. A. Significant evidence establishes that it was Plaintiff’s act to place that electronic signature. Thus, Plaintiff’s failure to read the Arbitration Agreement is not an excuse to contract formation. (E.g., KIMO03-04:2204998_1:5-24-18 -5- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N Madden, supra, 17 Cal.3d at 710.) Pursuant to California’s objective theory of contract law, Plaintiff undisputedly executed the contract and it is therefore a valid contract. III. THE FAA APPLIES TO THE ARBITRATION AGREEMENT, BUT EVEN UNDER CALIFORNIA LAW, ARBITRATION SHOULD STILL BE COMPELLED The evidence is sufficient to establish that the subject matter of the agreement involves interstate commerce such that the FAA preempts California Law. Plaintiff asserts that she was not involved in interstate commerce because her individual position was located and performed solely in California. However, Plaintiff misstates the law. An employer may establish FAA preemption by demonstrating the interstate nature of its business operations. (See Lane v. Francis Capital Management LLC (2014) 224 Cal.App.4th 676, 687.) Thus, the relevant inquiry is not the individualized role of the employee, but rather, the operations of the business in which the employee is engaged. (See id.) Here, Kimco has supplied evidence that the nature of its business is to provide temporary employee services to clients “across the nation.” (Williams Decl. { 3.) Moreover, Kimco has further supplied evidence that Plaintiff was assigned to Defendant Swift Transportation Co. of Arizona, LLC (“Swift”). (Id.) Plaintiff admits that Swift “was and is An (sic) Arizona limited liability company doing business in the County of Orange, State of California.” (Compl. q 4.) Consequently, as Plaintiff was performing services of an Arizona company doing business in California, the nature of that business was, per se, interstate commerce. Moreover, even if the FAA did not apply, the Arbitration Agreement would still require compelling this matter to arbitration under the California Arbitration Act, Code Civ. Proc. § 1280 et seq. Under the CAA, arbitration agreements are still valid, (Code Civ. Proc. § 1281), and “[o]n petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that party thereto refuses to arbitrate such controversy, the court shall order the petitioner and respondent to arbitrate the controversy...” (Code Civ. Proc. § 1281.2). Thus, Plaintiff’s argument that the FAA does not apply is rendered moot, as the matter should be compelled to arbitration under either state or federal law. KIMO03-04:2204998_1:5-24-18 -6- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N IV. PLAINTIFEF’S OPPOSITION FAILS TO ESTABLISH UNCONSCIONABILITY Arbitration agreements are presumed enforceable. (Cione v. Forester Equity Servs., Inc. (1997) 58 Cal. App. 4th 625, 642 (“a heavy presumption weighs the scales in favor of arbitrability”).) The party opposing arbitration has the burden of proving an exception to this presumption exists. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972.) Plaintiff fails to carry her burden here. In order to render the Agreement unenforceable, Plaintiff must establish both procedural and substantive unconscionability. (See Armendariz v. Found. Health Psychcare Servs., Inc. (2000) 24 Cal. 4th 83, 114.) “A sliding scale is applied so that the more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Pinela v. Neiman Marcus Grp., Inc. (2015) 238 Cal.App.4th 227, 242 (quotations omitted.)) A. The Arbitration Agreement Is Not Procedurally Unconscionable “Procedural unconscionability pertains to the making of the agreement and requires oppression or surprise.” (Magno v. The College Network, Inc. (2016) 1 Cal.App.5th 277, 285.) “The ‘oppression’ component of procedural unconscionability arises from an inequality of bargaining power of the parties to the contract and an absence of real negotiation or a meaningful choice on the part of the weaker party. ‘Surprise’ is defined as the extent to which the supposedly agreed-upon terms of the bargain are hidden in the prolix printed form drafted by the party seeking to enforce the disputed terms.” (Lennar Homes of California, Inc. v. Stephens (2014) 232 Cal.App.4th 673, 688, (internal quotations and citations omitted. )) Here, Plaintiff does not challenge the actual terms of the contract as oppressive or surprising. (PIf.’s Oppn. pp. 7-8.) Indeed, Courts generally uphold pre-dispute arbitration agreements entered into as part of an individual’s employment, even when those agreements are non-voluntary and made a condition of hiring or continued employment. (Lagatree v. Luce, Forward, Hamilton & Scripps, LLP, 74 Cal. App.4th 1105, 1127 (1999) (stating that cases uniformly agree that a compulsory pre-dispute arbitration agreement is not rendered unenforceable just because it is required as a condition of employment or offered on a “take it or leave it” basis.)) Consequently, there can be no argument that KIMO03-04:2204998_1:5-24-18 -7- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N the terms of this agreement are “oppressive” as the Arbitration Agreement here is less restrictive to Plaintiff that that typically and frequently upheld by the Courts in an employment context. (See id.) Moreover, the opt-out provision of the Arbitration Agreement provided Plaintiff with bargaining power and a meaningful choice in formulating the contract. Consequently, the agreement is not oppressive. (See Lennar Homes, supra, 232 Cal. App.4th at 688.) Likewise, the terms of the agreement cannot be considered surprising. The Arbitration Agreement is not hidden nor is any artifice employed to obscure its terms. Rather, it is a major component of the Applicant’s Statement and Agreement and written in plain language. (See Williams Decl. 5, Ex. A.) The Agreement clearly discloses that Plaintiff (and Kimco) “give up their right to trial by jury of any claim...” and that the Plaintiff had the ability to opt out. (/d. at p. 2.) The agreement further instructs Plaintiff, in bold typeface, to not sign the agreement before reading it and to discuss any questions she has about the agreement before signing it. (/d.) Moreover, the check-box opt-out draws specific attention to the arbitration clause. (See id.) The provisions of the agreement are not “hidden in the prolix” and cannot be considered surprising. (See Lennar Homes, supra, 232 Cal.App.4th at 688.) Rather, Plaintiff’s argument that the contract is procedurally unconscionable simply parrots her initial argument challenging the authenticity of the signature on the Arbitration Agreement. Plaintiff avers that because she did not sign the agreement, she was not permitted to read the Arbitration Agreement, she was not provided a copy of the Arbitration Agreement, she was not given the opportunity to review the Arbitration Agreement with a lawyer, no one explained its terms, and she was expected to be bound to the Arbitration with her consent. (PIf.’s Oppn. p. 8.) Plaintiff makes no argument about the substance of the Arbitration Agreement; she simply argues she did not see the Arbitration Agreement. (See id.) However, as demonstrated above, Plaintiff was provided with the Arbitration Agreement, provided the opportunity to review it, and affixed her electronic signature to the agreement. (Burton Decl. qq 4-8; Baglietto Decl. {{ 2-4.) Moreover, despite the Arbitration Agreement’s encouragement, Plaintiff did not ask any questions about the Arbitration Agreement or its specific terms and did not request additional time to review the agreement. (Baglietto Decl. q 3.) The fact that Plaintiff did not KIMO03-04:2204998_1:5-24-18 -8- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N read the Arbitration Agreement before signing does not relieve her of her contractual duties. (E.g., Madden, supra, 17 Cal.3d at 710.) Likewise, Plaintiff may not escape the consequences of her agreement by falsely claiming she has never seen the contract before. Such a rule would render every contract susceptible to an unconscionability argument, undermining the integrity of contract law itself. Consequently, Plaintiff has failed to raise any issue with respect to the Agreement’s procedural substantiality. B. Plaintiff’s Argument That The Agreement Is Substantively Unconscionable And Violates Armendariz Lacks Credibility “Substantive unconscionability addresses the fairness of the term in dispute. [It] traditionally involves contract terms that are so one-sided as to ‘shock the conscience,” or that impose harsh or oppressive terms” (Wherry v. Award, Inc. (2011) 192 Cal. App.4th 1242, 1248, (internal quotations omitted.)) However, the Arbitration Agreement is not substantively unconscionable: there is nothing overly-harsh or one-sided about its terms. Unlike the agreement found to be unconscionable in Armendariz, the Arbitration Agreement here does not seek unfair advantages for Kimco. The Arbitration Agreement provides complete mutuality of obligation, requiring Kimco to submit to arbitration for any of its claims against Plaintiff as well. (Williams Decl. { 5, Ex. A.) Moreover, the Arbitration Agreement provides for a neutral arbitrator, the same rules of pleading, evidence, and motion practice, and provides for adequate discovery. (Id. at pp. 1-2.) The Arbitration Agreement does not limit types of relief available, nor does it impose fees that Plaintiff would not bear in court, and the Arbitration Agreement provides that the written opinion of the arbitrator is subject to judicial review. (Id. at p. 2.) Consequently, nothing about the Arbitration Agreement is substantively unconscionable. (Armendariz, supra, 24 Cal.4th at 114.) Simply stating that the Arbitration Agreement is substantively unconscionable does not make it so. Plaintiff’s sole argument of substantive unconscionability is that the Arbitration Agreement includes a waiver of Plaintiff’s ability to bring a PAGA action. (PIf.’s Oppn. p. 9.) On this ground, Plaintiff avers that the entire agreement is unconscionable and unenforceable. (Id.) However, the very case cited by Plaintiff in her Opposition reaches the opposite conclusion. (Totten v. Kellogg Brown & Root, LLC (C.D. Cal. 2016) 152 F. Supp. 3d 1243, 1267.) Although the Court noted that a PAGA KIMO03-04:2204998_1:5-24-18 -9- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N waiver was unenforceable under Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348, 360, the court determined the waiver was severable, and the rest of the agreement enforceable, compelling the case to arbitration. (Totten, supra, 152 F. Supp. 3d at 1267.) Indeed, A court determination that “the arbitration agreement contains ... flawed provisions does not necessarily mean that the entire [arbitration agreement] is substantively unconscionable.” (Davis v. O'Melveny & Myers (9th Cir.2007) 485 F.3d 1066, 1084 (quotation omitted.)) California law permits a court to sever unconscionable provisions of an arbitration agreement if they are “merely ‘collateral’ to the main purpose of the arbitration agreement[.]” (Id. (quoting Armendariz, supra, 24 Cal.4th at 124.)) Thus, the Totten Court determined that because the arbitration agreement contained a savings clause specifically allowing for the severance of the PAGA waiver and enforcement of the rest of the agreement, the PAGA waiver to was “merely collateral” to the agreement and could be severed from the agreement while enforcing the rest. (Totten, supra, 152 F. Supp. 3d at 1267.) Here to, the agreement contains a provision that “[i]f any term or provision, or portion of this Agreement is declared void or unenforceable it shall be severed and the remainder of this Agreement shall be enforceable.” (Williams Decl. | 5, Ex. A.) Consequently, under Totten, the PAGA waiver is “merely collateral” to the Arbitration Agreement and can be severed from the agreement while enforcing the remaining terms. Moreover, Kimco has not sought to compel the PAGA claim to arbitration, but requested a stay on that action pending resolution of the arbitration. Thus, Kimco’s actions are consistent with severance of the term. V. IF THE COURT FEELS ADDITIONAL EVIDENCE IS NECESSARY KIMCO REQUESTS LIMITED DISCOVERY AN EVIDENTIARY HEARING Kimco asserts that the evidence submitted in support of its Motion is more than sufficient to authenticate the Arbitration Agreement and compel the matter to arbitration. However, to the extent the Court feels additional evidence is needed, Kimco requests that it be allowed to conduct limited KIMO03-04:2204998_1:5-24-18 -10- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION ~N O N n e B A W discovery on the matter of the arbitration agreement and that an evidentiary hearing be set where Plaintiff can provide live testimony on the matter.! VI. CONCLUSION Ultimately, while Plaintiff might prefer to pursue this action in court, she must abide by the written Arbitration Agreement she voluntarily signed. For the foregoing reasons, Plaintiff’s Opposition to Defendants’ Motion to Compel Arbitration is unpersuasive and Defendants’ Motion should be granted. Dated: May 24, 2018 CALL & JENSEN A Professional Corporation Mark L. Eisenhut J. Randall Boyer Byf - eC or J. Rapdall Boyer ttorneys for Defendant Kimco Staffing Services, Inc. 1 Plaintiff’s argument rests on her testimony that she did not receive the agreement, did not sign it, and did not agree to it. (See PIf.’s Oppn. p. 2, Declaration of Karen Valenzuela [attached to PIf.’s Oppn.] (“Valenzuela Decl.”) { 2.) However, Plaintiff also states that the first time she recalls seeing the document was in connection with this case. (Valenzuela Decl. 5.) Consequently, it is uncertain whether Plaintiff’s testimony that she was never given the agreement is a result of her inability to recall the document or whether she has a specific recollection of all agreements she signed and knows that the Arbitration Agreement is not one of them. To the extent Plaintiff’s testimony is based on her inability to recall signing the document, her lack of any recollection is insufficient to defeat the motion. To the extent Plaintiff avers an affirmative recollection of not signing the Arbitration Agreement, Plaintiff has potentially committed perjury. Consequently, discovery and live testimony clarifying Plaintiff’s vague declarations would be appropriate. KIMO03-04:2204998_1:5-24-18 -11- DEFENDANT KIMCO STAFFING SERVICES, INC.’S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION AN Ln W N 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 23 26 27 28 PROOF OF SERVICE STATE OF CALIFORNIA, COUNTY OF ORANGE I am employed in the County of Orange, State of California. I am over the age of 18 and not a party to the within action; my business address is 610 Newport Center Drive, Suite 700, Newport Beach, CA 92660. On May 24, 2018, I served the foregoing document described as DEFENDANT KIMCO STAFFING SERVICES, INC.S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATION on the following person(s) in the manner indicated: SEE ATTACHED SERVICE LIST [ 1 (BY ELECTRONIC SERVICE) I am causing the document(s) to be served on the Filing User(s) through the Court’s Electronic Filing System. [ 1 @BYMAIL) Iam familiar with the practice of Call & Jensen for collection and processing of correspondence for mailing with the United States Postal Service. Correspondence so collected and processed is deposited with the United States Postal Service that same day in the ordinary course of business. On this date, a copy of said document was placed in a sealed envelope, with postage fully prepaid, addressed as set forth herein, and such envelope was placed for collection and mailing at Call & Jensen, Newport Beach, California, following ordinary business practices. [ X] (BY FEDEX) I am familiar with the practice of Call & Jensen for collection and processing of correspondence for delivery by overnight courier. Correspondence so collected and processed is deposited in a box or other facility regularly maintained by FedEx that same day in the ordinary course of business. On this date, a copy of said document was placed in a sealed envelope designated by FedEx with delivery fees paid or provided for, addressed as set forth herein, and such envelope was placed for delivery by FedEx at Call & Jensen, Newport Beach, California, following ordinary business practices. [ 1] (BY FACSIMILE TRANSMISSION) On this date, at the time indicated on the transmittal sheet, attached hereto, I transmitted from a facsimile transmission machine, which telephone number is (949) 717-3100, the document described above and a copy of this declaration to the person, and at the facsimile transmission telephone numbers, set forth herein. The above-described transmission was reported as complete and without error by a properly issued transmission report issued by the facsimile transmission machine upon which the said transmission was made immediately following the transmission. AN nn W N 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 2:3 26 27 28 [1] (BY ELECTRONIC TRANSMISSION) I served electronically from the electronic notification address of the document described above and a copy of this declaration to the person and at the electronic notification address set forth herein. The electronic transmission was reported as complete and without error. I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct, and that this declaration was executed on May 24, 2018, at Newport Beach, California. Janelle Mulford AN Ln W N 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 23 26 27 28 SERVICE LIST Jace H. Kim, Esq. Zoe L. Ahearn, Esq. THE DOMINGUEZ FIRM, INC. 3250 Wilshire Blvd., Suite 1200 Los Angeles, CA 90010 Tel: (213) 401-1088 Fax: (213) 388-8095 Kevin D. Smith, Esq. Stacey F. Blank, Esq. Nicolas A. Pappas, Esq. WOOD SMITH HENNING & BERMAN LLP 10960 Wilshire Blvd., 18th Floor Los Angeles, CA 90024-3804 Tel: (310) 481-7600 Fax: (310) 481-7650 ksmith@wshblaw.com sblank @wshblaw.com npappas @wshblaw.com Attorneys for Plaintiff Karen Valenzuela Attorneys for Defendant Swift Transportation Co. of Arizona, LLC