Oregel v. PacPizza, LLC

• Citation: 187 Cal.Rptr.3d 436,237 Cal.App.4th 342
• Decision Date: 01 May 2015
• Docket Number: A141947
• Court: California Court of Appeals
• Parties: Julio OREGEL, Plaintiff and Respondent, v. PACPIZZA, LLC, Defendant and Appellant.

237 Cal.App.4th 342

187 Cal.Rptr.3d 436

Julio OREGEL, Plaintiff and Respondent

v.PACPIZZA, LLC, Defendant and Appellant.

A141947

Court of Appeal, First District, Division 2, California.

Filed May 1, 2015

Attorney for Plaintiff and Respondent: Keller Grover, Eric Andrew Grover ; Steven Lee Miller, Westlake Village; Law Offices of Ellen Lake, Ellen Lake, Oakland.

Attorneys for Defendant and Appellant: Burnham Brown, Michael Robert Bodzin.

OPINION

RICHMAN, J.

Seventeen months and more than 1,300 attorney hours after plaintiff Julio Oregel (Oregel) filed a class action against his former employer, defendant PacPizza, LLC (PacPizza), PacPizza petitioned to compel arbitration of Oregel's claims. The trial court denied the petition, finding PacPizza waived its right to enforce a purported arbitration agreement between the two parties. PacPizza appeals, primarily contending the court erred in denying the petition, and also asserting two other claimed errors. We conclude the petition was properly denied, a conclusion that moots PacPizza's remaining arguments. We thus affirm.

BACKGROUND

Preliminary Observation

We begin with an observation that, as the appellant, PacPizza was tasked with providing in its opening brief a summary of all evidence in the record that is material to the issues raised on appeal. (Cal. Rules of Court, rule 8.204(a)(2)(C) ; Foreman & Clark Corp. v. Fallon (1971) 3 Cal.3d 875, 881, 92 Cal.Rptr. 162, 479 P.2d 362.) This, it failed to do. PacPizza sets forth a less-than-candid “Chronology of Pertinent Events Underlying Appeal” that suggests little transpired in the 17 months between Oregel's filing of his complaint and PacPizza's filing of its petition to compel arbitration. Among other things, PacPizza has omitted any discussion of the extensive class discovery it conducted—an omission that is nothing short of brazen given the trial court's finding that Oregel was prejudiced by the discovery the parties conducted on his class allegations during the lengthy period of time PacPizza delayed in seeking arbitration.

What follows is a chronology of what actually transpired.

Oregel's Job Application

On July 24, 2008, Oregel submitted a written application for a job as a delivery driver at PacPizza's Pizza Hut restaurant in El Cerrito. At the bottom of the two-page application was a section titled, “Agreement,” followed by five paragraphs in small font, estimated by Oregel to be eight–point font, an estimate PacPizza does not dispute—indeed, one that we believe may overstate the size of the font. The fifth paragraph, titled “Agreement to Arbitrate,” stated: “Because of the delay and expense of the court system, Pizza Hut and I agree to use confidential binding arbitration, instead of going to court, for any claims that arise between me and Pizza Hut, its related companies, and/or their current or former employees. Without limitation, such claims would include any concerning compensation, employment (including, but not limited to, any claims concerning sexual harassment or discrimination), or termination of employment. Before arbitration, I agree: (i) first to present any such claims in full written detail to Pizza Hut; (ii) next, to complete any Pizza Hut internal review process; and (iii) finally, to complete any external administrative remedy (such as with the Equal Employment Opportunity Commission). In any arbitration, the then prevailing employment dispute resolution rules of the American Arbitration Association will apply, except that Pizza Hut will pay the arbitrator's fees, and Pizza Hut will pay that portion of the arbitration filing fee in excess of the similar court filing fee had I gone to court.” Oregel's signature followed.¹

Oregel's Complaint and First Amended Complaint

Oregel was apparently hired and worked as a delivery driver for some time. But on June 14, 2012, he filed a class action against PacPizza. The complaint alleged that PacPizza failed to fully reimburse delivery drivers for necessary expenses associated with using their personal vehicles to deliver pizza on PacPizza's behalf. It asserted two causes of action, one for failure to reimburse expenses in violation of Labor Code section 2802, the other for violation of California's unfair competition law (Bus. & Prof.Code, § 17200 et seq. ). And it sought compensatory and special damages, injunctive relief, disgorgement, attorney fees, and costs.

On July 30, 2012, PacPizza answered, generally denying Oregel's allegations. It also asserted 15 affirmative defenses, none of which alleged the existence of an agreement to arbitrate the dispute.

The court held case management conferences on September 5, 2012, and February 19, 2013. At the second conference, the parties agreed to a discovery schedule, and the court set September 30, 2013, as the deadline for Oregel to file his anticipated motion for class certification. The parties subsequently stipulated to a complete briefing schedule on the motion, with PacPizza's opposition due November 18 and the motion to be heard on December 6. PacPizza was silent on its intent to arbitrate Oregel's claims at both conferences and throughout discussions concerning the discovery and briefing schedules.

On March 4, 2013, Oregel filed a first amended complaint in which he reasserted his original two causes of action and added a third cause of action under the Labor Code Private Attorneys General Act of 2004 (Lab.Code, § 2698 et seq. )) (PAGA). To the relief sought in his original complaint, Oregel added civil penalties pursuant to Labor Code section 2699, subdivision (a).

PacPizza answered Oregel's first amended complaint three days later, once again denying his allegations and asserting 15 affirmative defenses—again, none of which alleged the existence of an agreement to arbitrate the dispute.

The Parties Conduct Extensive Class Discovery

Meanwhile, in September 2012, discovery commenced with Oregel propounding written discovery, much of which related to class certification issues. PacPizza objected to a special interrogatory seeking the identities of putative class members, forcing Oregel to move to compel production of the information. The court ordered PacPizza to produce the putative class members' identities. At no time during the discovery dispute did PacPizza suggest class discovery was unwarranted because it intended to arbitrate Oregel's claims.

On November 6, 2012, PacPizza served responses to Oregel's outstanding written discovery and produced responsive documents. Significantly, Oregel's special interrogatories Nos. 27 and 28 asked, respectively, “If YOU contend this action is affected by an arbitration agreement, state all facts supporting such contention,” and “If YOU contend this action is affected by an arbitration agreement, IDENTIFY all DOCUMENTS supporting such contention.” In response to both, PacPizza stated: “Plaintiff Julio Oregel signed an arbitration agreement on July 24, 2008, wherein he agreed to arbitrate all claims, including all employment related claims between he, Pizza Hut and all of Pizza Hut's related companies, which includes PacPizza.” Although PacPizza appended Oregel's job application to its responses, it gave no indication that it intended to seek enforcement of the arbitration agreement.

The parties continued discovery for the next 12 months. As to some of the particulars, on November 9, 2012, PacPizza propounded 226 written discovery requests, in response to which Oregel provided written responses and produced 792 documents. Much of the discovery PacPizza propounded pertained to Oregel's class allegations. By way of example, its special interrogatories asked Oregel to “[i]dentify all dates on which each putative class member incurred business expenses that DEFENDANT failed to fully reimburse to each respective putative class member” and to “[s]tate the amount of money that YOU claim is owed to each putative class member for DEFENDANT'S alleged failure to fully reimburse each respective putative class member's business expenses.” PacPizza asked Oregel to produce “[a]ll DOCUMENTS that support YOUR contention that DEFENDANT did not fully reimburse the expenses incurred by each putative class members ... when each made deliveries for DEFENDANT” and “[a]ll DOCUMENTS that YOU used to calculate the amount of business expenses DEFENDANT failed to reimburse to putative class members....”

In April 2013, PacPizza propounded additional written discovery, and in May, June, and September 2013, PacPizza served substantive responses to Oregel's second, third, and fourth sets of discovery requests.

In summer 2013, Oregel deposed PacPizza director of finance Alan Fuss and employee Collin Day, both designated by PacPizza as its persons most knowledgeable regarding specific topics, including class issues. Oregel also deposed PacPizza president Brian Thompson and audit department head William Likens on class-related subjects, as well as a representative from PacPizza's outside computer vendor.

On September 9, 2013, PacPizza deposed Oregel. During the deposition, counsel for PacPizza asked general questions regarding the job application Oregel signed, including whether he understood it contained an arbitration agreement. Oregel responded, “No” to that question.

On September 13, 2013, PacPizza served a motion to compel discovery of questionnaires putative class members had submitted to Oregel's counsel. Although Oregel initially opposed the motion, the parties reached a resolution with the assistance of a court-appointed facilitator, and he ultimately produced copies of certain questionnaires.

Oregel's Motion for Class Certification

On September 30, 2013, Oregel filed his motion for class certification. It was supported by declarations of his counsel, Eric Grover (appending 275 pages of supporting evidence), 33 putative class members, statistical consultant Richard Drogin, Ph.D., and Oregel himself.

On October 21, 2013, the parties stipulated to a modification of the briefing schedule on Oregel's motion to...