Lara v. Onsite Health, Inc.

• Decision Date: 17 September 2012
• Docket Number: No. CV 12–3337 MEJ.,CV 12–3337 MEJ.
• Citation: 896 F.Supp.2d 831
• Parties: Gloria LARA, Plaintiff, v. ONSITE HEALTH, INC., Defendant.
• Court: U.S. District Court — Eastern District of California

896 F.Supp.2d 831

Gloria LARA, Plaintiff,

v.ONSITE HEALTH, INC., Defendant.

No. CV 12–3337 MEJ.

United States District Court, N.D. California.

Sept. 17, 2012.

Bruce J. Highman, Louis A. Highman, Highman, Highman & Ball, A Professional Law Association, San Francisco, CA, Christopher P. Schlies, Law Offices of Christopher P. Schlies, Pleasanton, CA, for Plaintiff.

Arthur W. Curley, Bernadette Bantly, Bradley Curley Asiano Barrabee & Crawford, P.C., Larkspur, CA, for Defendant.

ORDER GRANTING DEFENDANT'S MOTION TO COMPEL ARBITRATION

MARIA–ELENA JAMES, United States Chief Magistrate Judge.

INTRODUCTION

Gloria Lara brings this lawsuit against Defendant Onsite Health, Inc. alleging a retaliatory discharge based on her opposition to Onsite's violations of minimum wage and overtime laws. Compl. ¶ 1, Dkt. No. 1. Pending before the Court is Onsite's Motion to Compel Arbitration. Dkt. No. 5. Pursuant to Civil Local Rule 7–1(b), the Court finds this matter suitable for disposition without oral argument and VACATES the September 20, 2012 hearing. After consideration of the parties' briefs, and controlling authorities, the Court GRANTS Onsite's Motion.

BACKGROUND

The following factual background is taken from Lara's Complaint. Onsite provides mobile dental and medical services to governmental and private entities. Compl. ¶ 5. Lara began working for Onsite in 2008 as a part-time hourly wage employee doing registered dental assistant work, earning $28.00 per hour. Id. ¶¶ 5, 6. Starting in July 2010, Lara began working full-time for Onsite, earning $2,427.09 twice a month. Id. ¶ 6. As part of her employment, Lara signed the following Binding Arbitration Agreement on July 30, 2010:

To aid in the rapid and economical resolution of any disputes which may arise under this offer letter agreement, you and Onsite Health, Inc. (the Company) agree that any and all claims, disputes or controversies of any nature whatsoever arising from or regarding the interpretation, performance, negotiation, execution, enforcement or breach of this offer letter agreement, your employment, or the termination of your employment, shall be resolved, to the greatest extent permitted by applicable law, by confidential, final and binding arbitration conducted before a single arbitrator with JAMS, Inc ... or ... the American Arbitration Association (“AAA”).... You and the company acknowledge that by agreeing to this arbitration procedure, we each waive the right to resolve any such dispute through a jury by trial, judge or administrative proceeding. You will have the right to be represented by legal counsel at any arbitration proceeding. The arbitrator shall: (a) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be available under applicable law in a court proceeding; and (b) issue a written statement signed by the arbitrator regarding the disposition of each claim and the relief, if any, awarded as to each claim, the reasons for the award, and the arbitrator's essential findings and conclusions on which the award is based. The Company shall bear JAMS' arbitration fees and administrative costs. Nothing in this Agreement shall prevent either you or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration.

Ritz Decl., Ex. 1, Dkt. No. 6–2 (emphasis in original).

As a full-time employee, Lara alleges that she was a non-exempt employee, but she regularly worked overtime, often working 10 hours per day. Id.

On April 20, 2011, Lara notified Onsite that she needed to be out for a disability leave. Id. ¶ 7. Onsite approved the leave for seven days. Id. At the same time, Lara also notified Onsite that she believed it was wrong to not pay her overtime. Id. ¶ 8. Onsite responded that Lara was a full-time salaried employee and was therefore not entitled to overtime compensation. Id. ¶ 9.

Lara's disability leave was subsequently extended by her treating health care provider until June 1, 2011, with a return to work date of June 2. Id. ¶ 11. Lara emailed Laurie Mann (her immediate supervisor) and Paula Ritz (Onsite's Director of Human Resources) on May 25 and 31, 2011, stating that she intended to return to work on June 2 and asking for a schedule. Id. ¶¶ 12, 13. However, on June 1, 2011, Lara received an email from Ritz stating that her position with Onsite had been eliminated due to organizational restructuring and a lack of business. Id. ¶¶ 12, 14.

Lara filed the present Complaint on June 28, 2012. She alleges retaliatory discharge under 29 U.S.C. § 216, wrongful discharge, failure to grant a reasonable accommodation for her disability, violation of California Labor Code section 2699, and claims under the California Fair Employment and Housing Act (“FEHA”).

On August 9, 2012, Onsite filed the present Motion to Compel Arbitration. Dkt. No. 5–1. In its motion, Onsite argues that Lara is bound by the July 30 Arbitration Agreement. Def.'s Mot. at 2. Specifically, Onsite argues that there is a valid Arbitration Agreement, neither party has waived the right to arbitrate, and no grounds exist for invalidating the provision. Id. at 2, 3, 5. Onsite also seeks an order under 9 U.S.C. § 3 staying the pending litigation. Id. In response, Lara argues that the Arbitration Agreement is both procedurally and substantively unconscionable, and it is therefore invalid and unenforceable. Pl.'s Opp'n at 1, Dkt. No. 6.

LEGAL STANDARD

Under the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., arbitration agreements “shall be valid, irrevocable, and enforceable, save upon such grounds that exist at law or in equity for the revocation of a contract.” 9 U.S.C. § 2; see AT & T Mobility, LLC v. Concepcion, –––U.S. ––––, ––––, 131 S.Ct. 1740, 1746, 179 L.Ed.2d 742 (2011). Section 4 of the FAA permits a “party aggrieved by the alleged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration [to] petition any United States district court ... for an order directing that ... arbitration proceed in the manner provided for in [the arbitration] agreement.” 9 U.S.C. § 4. If the court is satisfied “that the making of the arbitration agreement or the failure to comply with the agreement is not in issue, the court shall make an order directing the parties to proceed to arbitration in accordance with the terms of the agreement.” Id.

The FAA reflects “both a ‘liberal federal policy favoring arbitration,’ and the ‘fundamental principle that arbitration is a matter of contract.’ ” Concepcion, 131 S.Ct. at 1745 (quoting Moses H. Cone Mem'l Hosp. v. Mercury Const. Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983) and Rent–A–Center, West, Inc. v. Jackson, –––U.S. ––––, ––––, 130 S.Ct. 2772, 2776, 177 L.Ed.2d 403 (2010)). “In line with these principles, courts must place arbitration agreements on an equal footing with other contracts ... and enforce them according to their terms.” Id. at 1745–46 (citing Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 443, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006) and Volt Info. Sci., Inc. v. Bd. of Tr. of Leland Stanford Junior Univ., 489 U.S. 468, 478, 109 S.Ct. 1248, 103 L.Ed.2d 488 (1989)). Therefore, arbitration agreements may be “invalidated by generally applicable contract defenses, such as fraud, duress, or unconscionability.” Concepcion, 131 S.Ct. at 1744.

DISCUSSION

A. Whether a Valid Arbitration Agreement Exists

The first task is to determine whether there is an agreement between the parties to arbitrate. Mitsubishi Motors Corp. v. Soler Chrysler–Plymouth, Inc., 473 U.S. 614, 626, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985). As arbitration is a matter of contract, a party cannot be required to arbitrate a claim that it has not agreed to arbitrate. AT & T Tech., Inc. v. Communs. Workers of Am., 475 U.S. 643, 648–50, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986). “To evaluate the validity of an arbitration agreement, federal courts ‘should apply ordinary state-law principles that govern the formation of contracts.’ ” Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1170 (9th Cir.2003) (quoting First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995)). In this case, there appears to be no dispute that Lara is a California resident, that Onsite is located in San Mateo County, California, that Lara was employed by Onsite within this judicial district, and that the Arbitration Agreement was signed in California. Compl. ¶ 4; Lara Decl. ¶¶ 4–5, Dkt. No. 19. Accordingly, this Court looks to California contract law to determine whether the agreement to arbitrate is enforceable.

In California, the elements for a viable contract are (1) parties capable of contracting; (2) their consent; (3) a lawful object; and (4) sufficient cause or consideration. United States ex rel. Oliver v. Parsons Co., 195 F.3d 457, 462 (9th Cir.1999). As stated above, Lara signed the Arbitration Agreement on July 30, 2010. There is no dispute that the parties were capable of contracting and that the Arbitration Agreement related to a lawful matter. Nor can there be any dispute as to whether the Arbitration Agreement was supported by sufficient consideration. See Circuit City Stores, Inc. v. Najd, 294 F.3d 1104, 1108 (9th Cir.2002) (an employer's promise to be bound by the arbitration process itself serves as adequate consideration); see also Strotz v. Dean Witter Reynolds, 223 Cal.App.3d 208, 216, 272 Cal.Rptr. 680 (1990) (“Where an agreement to arbitrate exists, the parties' mutual promises to forego a judicial determination and to arbitrate their disputes provide consideration for each other.”), overruled on other grounds by Rosenthal v. Great Western Fin. Secs. Corp., 14 Cal.4th 394, 58 Cal.Rptr.2d 875, 926 P.2d 1061 (1996). Thus, there is no reasonable dispute that Lara and Onsite entered into the Arbitration Agreement and that the claims at issue here are...