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Narez v. Macy's West Stores, Inc.

United States District Court, N.D. California, San Jose Division

July 28, 2016

YULIE NAREZ, Plaintiff,



         Before the Court is a motion to compel arbitration filed by Defendant Macy’s West Stores, Inc. (“Defendant ”). ECF No. 17 (“Mot.”). Defendant requests that the Court compel arbitration of all individual claims brought by Plaintiff Yulie Narez (“Plaintiff) against Defendant, dismiss Plaintiffs class action, and stay Plaintiffs Private Attorneys General Act, Cal. Labor Code §§ 2698, et seq. (“PAGA”) action. See Mot. Pursuant to Civil Local Rule 7-1(b), the Court finds this motion appropriate for resolution without oral argument and VACATES the motion hearing and case management conference set for August 4, 2016. Having considered the submissions of the parties, the relevant law, and the record in this case, the Court GRANTS Defendant’s motion to compel arbitration.

         I. BACKGROUND

         A. Factual Background

         Plaintiff was hired by Defendant as a retail store employee on November 23, 2013. Decl. of Yulie Narez (“Narez Decl.”), ECF No. 26-1, ¶ 3. As part of Plaintiff’s hiring paperwork, Plaintiff received a copy of a Solutions InSTORE Early Dispute Resolution (“SIS”) brochure describing Defendant’s arbitration agreement policy and Plaintiff signed an acknowledgement of receipt of the SIS brochure. Id. ¶ 3 (“When I was hired, I signed various documents. . . . I was handed a physical copy of the Solutions InSTORE Early Dispute Resolution brochure and was told that this document was the version which I was acknowledging receipt of by my electronic signature.”); Decl. of Ragunathan Veeraraghavan (“Veeraraghavan Decl.”), ECF No. 18, ¶ 4, Exs. A, G (text of acknowledgement of receipt of SIS brochure and Plaintiff’s electronic signature). Although the parties agree that Plaintiff received an SIS brochure and signed an acknowledgement of her receipt of the SIS brochure, the parties dispute the content of the SIS brochure given to Plaintiff. That dispute is addressed in the discussion below.

         B. Procedural History

         Plaintiff filed the instant lawsuit in state court on January 25, 2016. ECF No. 1. Plaintiff seeks to represent a class of Defendant’s employees and alleges Defendant violated various provisions of the California Labor Code by failing to pay all applicable wages and overtime and for failing to provide statutorily mandated meal and rest breaks. Id. Plaintiff additionally seeks to bring a PAGA claim against Defendant. Id.

         The case was removed to federal court on February 25, 2016. ECF No. 1. Defendant filed an answer to Plaintiff’s complaint on March 2, 2016. ECF No. 9.

         On May 6, 2016, Defendant filed the instant motion to compel arbitration. Mot., ECF No. 17. Plaintiff filed an opposition to Defendant’s motion on May 20, 2016. ECF No. 26 (“Opp.”). Defendant replied on May 27, 2016. ECF No. 27 (“Reply”).


         The Federal Arbitration Act (“FAA”) applies to arbitration agreements in employment contracts, except for those covering workers engaged in transportation. E.E.O.C. v. Waffle House, Inc., 534 U.S. 279, 289 (2002). Under Section 3 of the FAA, “a party may apply to a federal court for a stay of the trial of an action ‘upon any issue referable to arbitration under an agreement in writing for such arbitration.’” Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63, 68 (2010) (quoting 9 U.S.C. § 3). If all claims in litigation are subject to a valid arbitration agreement, a federal court has discretion to dismiss or stay the case. Nitsch v. DreamWorks Animation SKG Inc., 100 F.Supp.3d 851, 861-62 (N.D. Cal. Apr. 24, 2015).

         “For any arbitration agreement within the coverage of the FAA, the court is to make the arbitrability determination by applying the federal substantive law of arbitrability, absent clear and unmistakable evidence that the parties agreed to apply non-federal arbitrability law.” Brennan v. Opus Bank, 796 F.3d 1125, 1129 (9th Cir. 2015) (citations and brackets omitted). “A party seeking to compel arbitration has the burden under the FAA to show (1) the existence of a valid, written agreement to arbitrate; and, if it exists, (2) that the agreement to arbitrate encompasses the dispute at issue.” Ashbey v. Archstone Prop. Mgmt., Inc., 785 F.3d 1320, 1323 (9th Cir. 2015); see also Brennan, 796 F.3d at 1130; Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000). If the party seeking to compel arbitration establishes both factors, the court must compel arbitration. Id. “The standard for demonstrating arbitrability is not a high one; in fact, a district court has little discretion to deny an arbitration motion, since the [FAA] is phrased in mandatory terms.” Republic of Nicar. v. Std. Fruit Co., 937 F.2d 469, 475 (9th Cir. 1991).

         The FAA creates a body of federal substantive law of arbitrability that requires a healthy regard for the federal policy favoring arbitration and preempts state law to the contrary. Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 U.S. 468, 475-79 (1989); Ticknor v. Choice Hotels Int’l, Inc., 265 F.3d 931, 936-37 (9th Cir. 2001). State law is not entirely displaced from the federal arbitration analysis, however. See Ticknor, 265 F.3d at 936-37. When deciding whether the parties agreed to arbitrate a certain matter, courts generally apply ordinary state law principles of contract interpretation. First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995). Parties may also contract to arbitrate according to state rules, so long as those rules do not offend the federal policy favoring arbitration. Volt, 489 U.S. at 478-79. Thus, in determining whether parties have agreed to arbitrate a dispute, the court applies “general state-law principles of contract interpretation, while giving due regard to the federal policy in favor of arbitration by resolving ambiguities as to the scope of arbitration in favor of arbitration.” Mundi v. Union Sec. Life Ins. Co., 555 F.3d 1042, 1044 (9th Cir. 2009) (quoting Wagner v. Stratton Oakmont, Inc., 83 F.3d 1046, 1049 (9th Cir. 1996)). “[A]s with any other contract, the parties’ intentions control, but those intentions are generously construed as to issues of arbitrability.” Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626 (1985). If a contract contains an arbitration clause, there is a presumption of arbitrability, AT&T, 475 U.S. at 650, and “any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration, ” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983).

         III. ...

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