Menendez v. Time Warner Cable Inc

• Decision Date: 18 October 2010
• Docket Number: No. BC427864,B223435,BC427864
• Court: California Court of Appeals Court of Appeals
• Parties: MANUEL MENENDEZ, Plaintiff and Respondent, v. TIME WARNER CABLE, INC., Defendant and Appellant.

MANUEL MENENDEZ, Plaintiff and Respondent,

v.TIME WARNER CABLE, INC., Defendant and Appellant.

B223435

No. BC427864

COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FIVE

Filed: October 18, 2010

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

APPEAL from an order of the Superior Court of Los Angeles County, Ralph W. Dau, Judge. Affirmed.

Hill, Farrer & Burrill, E. Sean McLoughlin and Casey L. Morris for Defendant and Appellant.

Law Offices of Michael J. Curls, Michael J. Curls and Nichelle D. Jones for Plaintiff and Respondent.

I. INTRODUCTION

Defendant, Time Warner Cable, Inc., appeals from a March 15, 2010 order denying its petition to compel plaintiff, Manuel Menendez, to arbitrate his claims. Defendant contends it is the successor in interest to an arbitration agreement between plaintiff and his former employer. We conclude substantial evidence supported the trial court's finding defendant failed to demonstrate it succeeded to the arbitration rights. Accordingly, we affirm the order.

II. BACKGROUND

This appeal arises in an action brought by plaintiff and his wife, Shelondra Davis--Menendez. They alleged: they were both employed with defendant; Ms. Davis--Menendez was subjected to inappropriate sexual conduct by a supervisor; plaintiff assisted Ms. Davis-Menendez in her legal responses to the misconduct; and both were retaliated against. Their causes of action were for wrongful termination, sexual harassment, retaliation, privacy invasion and intentional emotional distress infliction.

Defendant filed a petition to compel Mr. Menendez to arbitrate his claims. Defendant relied on the arbitration clause of a September 23, 1998 employment agreement between plaintiff and "MediaOne, a MediaOne Group company." The employment agreement defined MediaOne Group as follows, "As used in this Attachment, the term 'MediaOne Group' includes MediaOne, [and] any successor, subsidiary or affiliate of MediaOne Group." (The parties draw no distinction between "MediaOne" and "MediaOne Group.") Defendant asserted it was "the successor of MediaOne." The only evidence supporting that claim was the declaration of defendant's vice president of employee relations, Paul Falcone, who declared: "On August 1, 2006, [defendant] became the successor in interest of the property, assets and employees of MediaOne, at the location where plaintiff Manuel Menendez was employed. At that time, Mr. Menendez's employment transferred to [defendant]."

In opposing defendant's petition, plaintiff declared: at the time he was first employed by MediaOne, in 1998, he received a "stack of paperwork" and was instructed to sign the documents; "[w]hen MediaOne became Comcast, I was required to sign a different set of documents and told that I was rehired as a Comcast employee"; he understood that the Comcast documents superseded any documents he had signed with MediaOne; "[w]hen Comcast became Time Warner Cable, I was required to sign a different set of documents and told that I was... rehired as a Time Warner Cable employee"; he understood that any documents he signed with Time Warner Cable superseded any documents he had signed with MediaOne or Comcast. Ms. Davis--Menendez similarly declared: she was employed by Comcast in 2006; "[w]hen Comcast became Time Warner, I as required to sign a different set of documents and told that I was... rehired as a Time Warner Cable employee"; and she understood that any documents she signed with Time Warner Cable superseded any documents she had signed with Comcast. In its reply papers, defendant did not address the foregoing assertions.

At the hearing on defendant's petition, plaintiff's counsel argued it was uncertain whether defendant could enforce the arbitration agreement with Media One. The following colloquy ensued: "The Court: And where is it shown that Time Warner Cable, Inc. is a successor to MediaOne? [¶] [Defendant's attorney, James Bowles]:... It's the declaration of Paul Falcone.... [¶] The Court: But that's just a conclusion. By virtue of what did it bec[o]me a successor? [¶] Mr. Bowles: It acquired the properties of MediaOne, which included the employees and the properties and the facility.... [¶] The Court: What is this, an asset acquisition? [¶] Mr. Bowles: Yes, Your Honor.... It acquired the interest in the property, the assets and the employees of MediaOne.... [¶] The Court: How do you acquire an employee? [¶] Mr. Bowles: When they acquired the asset, they actually acquired the employees as well, Your Honor. They hired all of theemployees at that location. [¶]... [¶] Mr. Bowles:... [I]t wasn't a merger, Your Honor, it was an acquisition of the assets and the property and the employees."

The trial court denied defendant's petition to compel arbitration. The trial court found defendant had not established it was MediaOne's successor entitled to enforce the arbitration agreement. The trial court concluded: "Defendant's petition to compel arbitration alleges in paragraph 3 that '[defendant] is the successor of MediaOne' and in paragraph 5 that '[t]he Agreement provides that it is binding on any successors of MediaOne.' The Agreement says no such thing. It says: "As used in this Attachment, the term "MediaOne Group" includes MediaOne, any successor, subsidiary or affiliate of MediaOne Group, and the associates/employees, officers, directors, and agents of each of them.' [Defendant], having acquired only the assets of MediaOne is not 'bound' by the Agreement. If [defendant] wanted an arbitration agreement with plaintiff, it should have contracted with him to that effect. There is no showing that it did so."

III. DISCUSSION

A. Due Process

Defendant asserts it was denied due process in that its status as MediaOne's successor was not challenged prior to the trial court hearing. Defendant did not make a due process objection in the trial court. As a result, that argument has been forfeited. (People v. Anderson (2001) 25 Cal.4th 543, 592, fn. 17; People v. Williams (1997) 16 Cal.4th 153, 250; In re Brian K. (2002) 103 Cal.App.4th 39, 42.) Even if the due process argument were properly before us, we would find no violation. The due process clauses of the federal and state Constitutions guarantee notice and an opportunity to be heard appropriate to the nature of the case. (Boddie v. Connecticut (1971) 401 U.S. 371, 378; In re Jesusa V. (2004) 32 Cal.4th 588, 601.) Here, defendant had both notice and an opportunity to be heard. (See In re Elizabeth M. (2008) 158 Cal.App.4th 1551, 1556; In re Brian K., supra, 103 Cal.App.4th at pp. 42-43.) Plaintiff's opposition to defendant'spetition raised a question whether defendant could enforce the arbitration agreement. Hence, defendant was on notice. Defendant chose not to address that issue in its papers filed in the trial court. However, defendant's counsel, Mr. Bowles, argued the issue on the merits at the trial court hearing. As noted above, defendant did not raise a due process objection in the trial court. Further, defendant never requested an opportunity to submit further evidence or briefing. No due process violation occurred.

B. Arbitrability

Under both federal and California state law, arbitration is a matter of contract between the parties. (First Options of Chicago, Inc. v. Kaplan (1995) 514 U.S. 938, 944-945; Victoria v. Superior Court (1985) 40 Cal.3d 734, 739.) The initial question before the trial court was whether there was a valid and enforceable agreement to arbitrate between the parties. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972; Molecular Analytical Systems v. Ciphergen Biosystems, Inc. (2010) 186 Cal.App.4th 696, 705-706; Bruni v. Didion (2008) 160 Cal.App.4th 1272, 1283.) State law applicable to contracts generally governs the resolution of that question. (Perry v. Thomas (1987) 482 U.S. 483, 492; Metters v. Ralphs Grocery Co. (2008) 161 Cal.App.4th 696, 701; Craig v. Brown & Root, Inc. (2000) 84 Cal.App.4th 416, 420; Chan v. Drexel Burnham Lambert, Inc. (1986) 178 Cal.App.3d 632, 637.) This is so even though the parties agreed the Federal Arbitration Act would govern the "arbitrability" of all claims. (Metters v. Ralphs Grocery Co., supra, 161 Cal.App.4th at p. 701 [federal policy in favor of arbitration does not come into play until court has found parties entered into valid contract under state law]; Chan v. Drexel Burnham Lambert, Inc., supra, 178 Cal.App.3d at pp. 639-640.)

The trial court resolves the question whether there is a valid and enforceable agreement to arbitrate pursuant to a summary proceeding wherein it acts as the trier of fact. (Engalla v. Permanente Medical Group, Inc., supra, 15 Cal.4th at p. 972; Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413.) The Supreme Courthas held: "In these summary proceedings, the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court's discretion to reach a final determination. [Citation.]" (Engalla v. Permanente Medical Group, Inc., supra, 15 Cal.4th at p. 972.) The trial court's resolution of disputed facts will be upheld if supported by substantial evidence. (Nyulassy v. Lockheed Martin Corp. (2004) 120 Cal.App.4th 1267, 1277; Metters v. Ralphs Grocery Co., supra, 161 Cal.App.4th at p. 701; Engineers & Architects Assn. v. Community Development Dept. (1994) 30 Cal.App.4th 644, 653.) It is undisputed that defendant was not a party to the employment agreement between plaintiff and MediaOne. However, a nonparty may be allowed to enforce an arbitration agreement when there is a sufficient identity of parties. (Bouton v. USAA Cas. Ins....