Ashael Resendiz vs Canyon Restaurant LTD LP et al
Ashael Resendiz vs Canyon Restaurant LTD LP et al
Case Number
24CV00190
Case Type
Hearing Date / Time
Mon, 10/14/2024 - 10:00
Nature of Proceedings
CMC; Motion: Compel Arbitration and Stay Litigation
Tentative Ruling
Ashael Resendiz v. Canyon Restaurant, Ltd., L.P.
Case No. 24CV00190
Hearing Date: October 14, 2024
HEARING: Motion To Compel Arbitration And Stay Litigation
ATTORNEYS: For Plaintiff Ashael Resendiz: Norman B. Blumenthal, Kyle R. Nordrehaug, Aparajit Bhowmik, Jeffrey S. Herman, Sergio J. Puche, Trevor G. Moran, Blumenthal Nordrehaug Bhowmik De Blouw LLP
For Defendants Canyon Restaurant, Ltd., L.P., Reunion Boat Canyon, L.P., Reunion Santa Barbara, LLC, Reunion Dos Lagos, Inc., and Scott McIntosh: Landon R. Schwob, Jacob P. Waschak, Ani Boyadjian, Fisher & Phillips LLP
TENTATIVE RULING:
(1) The motion of defendants to compel arbitration and stay litigation is denied.
(2) The Declaration of Elisabeth Ramsey filed on August 7, 2024, in support of defendants’ motion to compel arbitration and stay litigation is ordered filed under seal. Only the Court, the parties named in this action, and their counsel of record are authorized to inspect the sealed record. On or before October 21, 2024, defendants shall file and serve a public redated version of the Declaration of Elisabeth Ramsey, in the same form as the declaration previously filed on August 7, 2024, and in accordance with this ruling.
(3) To the extent defendants fail to file and serve a public redacted version of the Declaration of Elisabeth Ramsey in compliance with this ruling, defendants’ counsel, Landon R. Schwob, Jacob P. Waschak, and Ani Boyadjian, shall appear on November 4, 2024, at 10:00 a.m. in this Department, and show cause why monetary sanctions not to exceed $1,500 should not be imposed against them for violating the Court’s order herein. If necessary, defendants’ counsel shall file and serve a written response to the Court’s order to show cause on or before October 28, 2024. Provided defendants fully comply with the Court’s ruling herein, appearances at the November 4, 2024, order to show cause are not necessary.
Background:
On January 16, 2024, plaintiff Ashael Resendiz (Resendiz) filed a representative action complaint alleging one cause of action for civil penalties under Labor Code section 2698 et seq. (the Labor Code Private Attorneys General Act of 2004 or PAGA). Resendiz brings the complaint on behalf of himself and all employees or individuals who are or previously were employed by or staffed with defendant Canyon Restaurant Ltd., L.P. (Canyon) as non-exempt employees in California from September 27, 2022. (Compl., ¶¶ 1, 7-8 & 36.) Resendiz alleges that Canyon failed to properly record and provide legally required meal and rest periods, to pay minimum wages, to pay overtime and sick time wages, to provide reimbursement for required business expenses, to timely provide wages when due including upon termination, to provide complete and accurate wage statements, and to provide suitable seating to the aggrieved employees. (Id. at ¶¶ 11-31 & 38.)
On March 1, 2024, Canyon filed its answer to the complaint generally denying its allegations and asserting thirty-six affirmative defenses.
On May 31, 2024, Resendiz filed three amendments to the complaint substituting Reunion Boat Canyon, L.P. (Reunion BC), Reunion Santa Barbara, LLC (Reunion SB), Reunion Dos Lagos, Inc. (Reunion DL) (collectively, the Reunion Defendants), and Scott McIntosh (McIntosh) for, respectively, fictitiously named defendants designated as Does 1 through 4.
On July 17, 2024, Resendiz filed a request for dismissal of the non-representative or individual PAGA claim alleged in the complaint, without prejudice. In the request for dismissal, Resendiz states that he intends to proceed in this action on behalf of aggrieved employees under PAGA only, and not in Resendiz’s individual capacity. (July 17, 2024, Request at p. 1, ll. 2-5.) In support of the request for dismissal, Resendiz submits the declaration of his counsel, Sergio Julian Puche, who declares that Resendiz wishes to proceed with representative claims only under PAGA on behalf of the State of California. (Puche Decl., ¶¶ 4-5.)
On July 24, 2024, the Court signed and entered an order for dismissal of the individual non-representative PAGA claims alleged by Resendiz in the complaint.
On August 7, 2024, Canyon, the Reunion Defendants, and McIntosh (collectively, defendants) filed a motion for an order compelling arbitration and staying this litigation. The grounds for the motion as stated in the notice are that Resendiz executed a valid and enforceable agreement to submit all employment related disputes to binding private arbitration while waiving class and representative claims. (Notice at p. 2, ll. 8-10.)
The motion is opposed by Resendiz.
Analysis:
The parties here do not dispute that there exists a valid, written agreement to arbitrate (the arbitration agreement) that encompasses the individual PAGA claim alleged in the complaint and which Resendiz voluntarily signed on August 8, 2018. (Ramsey Decl., Exh. 1 at ¶ 2; Herman Decl. [same].) Therefore, defendants have met their burden to show the existence of a valid written agreement to arbitrate which encompasses the nonrepresentative or individual PAGA claim alleged in the complaint. (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413 (Rosenthal); Cheng-Canindin v. Renaissance Hotel Associates (1996) 50 Cal.App.4th 676, 683 [“[u]nder both federal and state law, the threshold question presented by a petition to compel arbitration is whether there is an agreement to arbitrate”]; Chiron Corp. v. Ortho Diagnostic Systems, Inc. (9th Cir. 2000) 207 F.3d 1126, 1130 [under the FAA, the court must determine “(1) whether a valid agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue”].)
In addition, Resendiz offers no factual or legal argument to show that the arbitration agreement is in any respects unconscionable, nor does Resendiz contend that the Reunion Defendants or McIntosh may not, as nonsignatory defendants, enforce the arbitration agreement. (Rosenthal, supra, 14 Cal.4th at p. 413 [party raising a defense to enforcement of arbitration agreement bears the burden to show any facts necessary to the defense]; see also, Thomas v. Westlake (2012) 204 Cal.App.4th 605, 614 [discussion of exception to rule that only signatories may enforce an arbitration agreement]; Victrola 89, LLC v. Jaman Properties 8 LLC (2020) 46 Cal.App.5th 337, 353 [discussion of circumstances under which plaintiff may be compelled to arbitrate claims against a non-signatory defendant].)
In the notice of the present motion, defendants assert as grounds for the motion that Resendiz waived any representative claims under PAGA. Notwithstanding the grounds asserted in the notice, wholly absent from the supporting memorandum is any reasoned argument showing that the nonindividual or representative PAGA claim alleged in the complaint was waived by Resendiz. (See, e.g., Memo at pp. 11-13 [requesting an order staying non-individual or representative PAGA claims].) Moreover, to the extent defendants contend that there exists a wholesale waiver by Resendiz of any representative claims that may be brought under PAGA, any such waiver is invalid. (Adolph v. Uber Technologies, Inc. (2023) 14 Cal.5th 1104, 1114, 1117-1119 (Adolph).)
Furthermore, Resendiz is not required to allege an individual PAGA claim in order to maintain standing to pursue a representative action under PAGA, provided Resendiz alleges he was an employee of defendants against whom one or more of the violations alleged in the complaint was committed. (Adolph, supra, 14 Cal.5th at pp. 1114, 1117-1119; see also Balderas v. Fresh Start Harvesting, Inc. (2024) 101 Cal.App.5th 533, 538-539.) Defendants fail to show why Resendiz has failed to allege that he suffered a Labor Code violation while employed by defendants such that Resendiz lacks standing to bring a representative claim under PAGA.
Though Resendiz does not dispute that there exists a valid and enforceable agreement to arbitrate his individual PAGA claim, Resendiz contends that because he has dismissed the individual, non-representative component of the PAGA claim alleged in the complaint, only the nonindividual components of the PAGA cause of action remain which Resendiz contends cannot be compelled to arbitration. (See Adolph, supra, 14 Cal.5th at pp. 1117-1118 [arbitration agreement purporting to waive nonindividual PAGA claims is unenforceable]; Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. 639, 662.) In response, defendants perplexingly appear to contend that, though Resendiz has voluntarily dismissed the individual claim alleged in the complaint, there remain individual claims alleged under PAGA that Resendiz is required to submit to arbitration pursuant to the arbitration agreement because Resendiz seeks to recover PAGA penalties on behalf of himself.
“Pursuant to Code of Civil Procedure section 581, subdivisions (b) and (c), plaintiffs have the right to voluntarily dismiss an entire action, or causes of action within a pleading, before the commencement of trial. A request for a dismissal is usually effective upon filing, and no other action by the clerk or the court is required.” (Law Offices of Andrew L. Ellis v. Yang (2009) 178 Cal.App.4th 869, 876, original italics [also noting that upon the filing of a request to voluntarily dismiss a matter, “the trial court loses jurisdiction to act” except as to awarding costs and statutory attorney’s fees].) Court records detailed above reflect that Resendiz has voluntarily dismissed, without prejudice, any and all individual claims under PAGA alleged in the complaint. Therefore, the only claims remaining in this litigation are the nonindividual or representative claims alleged on behalf of other aggrieved employees under PAGA. For these reasons, ordering Resendiz to arbitrate an individual claim that has been voluntarily dismissed would be futile. (See Glaser, Weil, Fink, Jacobs & Shapiro, LLP v. Goff (2011) 194 Cal.App.4th 423, 444-445 [the law does not require futile acts].) Defendants also fail to address the question of whether or not the Court presently has jurisdiction to order Resendiz to arbitrate a claim that has been voluntarily dismissed. Moreover, defendants do not appear to contend that Resendiz must arbitrate the representative PAGA action.
Furthermore, the Court interprets any language appearing in the complaint or request for dismissal alleging that Resendiz is an aggrieved employee as effectively asserting that the Labor Code violations at issue in this action were also committed against Resendiz. (See, e.g., Kim v. Reins International California, Inc. (2020) 9 Cal.5th 73, 83-84 [discussion of PAGA standing].) In addition, to the extent defendants contend that Resendiz is not an “aggrieved employee” or Resendiz attempts to seek recovery for an individual claim under PAGA, the parties may address these issues at a procedurally appropriate time in a procedurally appropriate manner.
For all reasons discussed above, as the individual component of the PAGA claim alleged in the complaint has been voluntarily dismissed by Resendiz, the Court will deny the motion.
Objections to and request to strike defendants’ evidence:
In support of his opposition to the motion, Resendiz asserts objections to the declaration of Elisabeth Ramsey (Ramsey) submitted by defendants, and requests an order striking the Ramsey declaration. As grounds for the objections and request to strike, Resendiz asserts that exhibit 2 to the Ramsey declaration includes documents that disclose Resendiz’s full social security number and other private contact information which, according to Resendiz, have no evidentiary value and violate California Rules of Court, rule 1.201. (Note: Undesignated rule references shall be to the California Rules of Court unless otherwise indicated.)
Exhibit 2 to the Ramsey declaration submitted in support of the motion includes a form W-4 in which appears Resendiz’s full social security number. Rule 1.201 provides that, “[i]f an individual’s social security number is required in a pleading or other paper filed in the public file, only the last four digits of that number may be used.” (Cal. Rules of Court, rule 1.201(a)(1).) The requirement to use only the last four digits of an individual’s social security number is intended to “protect personal privacy and other legitimate interests ….” (Cal. Rules of Court, rule 1.201(a).) Further, “[t]he responsibility for excluding or redacting identifiers identified in (a) from all documents filed with the court rests solely with the parties and their attorneys.” (Cal. Rules of Court, rule 1.201(b).) Because defendants have failed to redact the social security number appearing in exhibit 2 to the Ramsey declaration, defendants have violated the provisions of rule 1.201(a)(1).
With respect to the request of Resendiz to strike the Ramsey declaration based on defendants’ failure to comply with rule 1.201, the Court finds that there exists an overriding interest in Resendiz’s personal privacy with respect to, and a legitimate interest in preventing the disclosure of, Resendiz’s social security number which, under the express provisions of rule 1.201, overcomes the public’s right to access this information. As defendants have publicly filed the Ramsey declaration without first redacting the social security number appearing in exhibit 2 of that declaration, as required under rule 1.201(a)(1) & (b), and as the Court requires an appropriate record on which to determine the present motion, there exists no less restrictive means to achieve the overriding interest discussed above apart from sealing the Ramsey declaration. Therefore, the Court will order that the Ramsey declaration be filed under seal. Further, the Court will order defendants to, on or before October 21, 2024, file and serve a public version of the Ramsey declaration which redacts the social security number appearing in exhibit 2.
The Court’s ruling is without prejudice to the filing of a procedurally and substantively appropriate motion to seal by Resendiz to the extent Resendiz contends that there exist facts sufficient to justify the sealing of any other record or information submitted by defendants in support of the motion. (Cal. Rules of Court, rule 2.551.)
As to the remaining objections asserted by Resendiz, the Court considers only admissible evidence that is relevant to the issues presented in determining the present motion.