Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Bradford v. Flagship Facility Services Inc.

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

July 24, 2017

GREGORY A. BRADFORD, Plaintiff,
v.
FLAGSHIP FACILITY SERVICES INC, Defendant.

          ORDER GRANTING DEFENDANT'S MOTION TO COMPEL ARBITRATION AND TO DISMISS THE ACTION AND DENYING AS MOOT DEFENDANT'S ALTERNATIVE MOTION TO STAY RE: DKT. NO. 11

          LUCY H. KOH United States District Judge

         Plaintiff Gregory Bradford (“Plaintiff), on behalf of himself and others similarly situated, sues Flagship Facility Services Inc. (“Defendant”) for unpaid wages. Before the Court is Defendant's Motion to Compel Arbitration and to Dismiss the Action or, in the Alternative, Stay the Action Pending Arbitration. ECF No. 11 (“Mot.”). Having considered the parties' briefing, the relevant law, and the record in this case, the Court GRANTS Defendant's Motion to Compel Arbitration and Dismiss the Action, and DENIES as moot Defendant's Alternative Motion to Stay the Action Pending Arbitration.

         I. BACKGROUND

         A. Factual Background

         Defendant is a “dedicated facility maintenance company that provides services that include but are not limited to, janitorial services, facility maintenance, and food services to various companies across California.” ECF No. 1, Complaint (“Compl.”) ¶ 13. “Plaintiff was employed by Defendant[] . . . performing duties relating to food handling, preparation, and cooking to serve businesses that request said services.” Id. ¶ 12. Plaintiff originally started working for Defendant in 2008. Id. However, after a period of separation from the company, Plaintiff was rehired by Defendant as a cook in April 2012. ECF No. 11-2, Declaration of Ralph Covarrubias (“Covarrubias Decl.”) ¶ 5 (“Plaintiff had been employed by Flagship prior to April 2012, but then he left Flagship and was rehired in April 2012.”).

         During the hiring process, Plaintiff was issued a number of documents. One of those documents was an arbitration agreement titled “Dispute Resolution Policy.” Covarrubias Decl. Ex. C (“Dispute Policy”). Plaintiff also signed a form in which Plaintiff agreed that “I, Gregory Bradford, received a copy of, had the opportunity to ask questions about, do understand and agree to abide by each of the following documents I have initialed below.” Covarrubias Decl. Ex. B. Plaintiff then signed his initials next to a line that stated “Dispute Resolution.” Id.

         The Dispute Resolution Policy “applies to any dispute arising out of or related to Employee's employment or termination of employment.” Dispute Policy ¶ 1. Moreover, the Dispute Resolution Policy states that it “is intended to apply to the resolution of disputes that otherwise would be resolved in a court of law, and therefore this Policy requires all such disputes to be resolved only by an arbitrator through final and binding arbitration and not by way of court or jury trial.” Id. The Dispute Resolution Policy also specifies that “there will be no right or authority for any dispute to be brought, heard or arbitrated as a class or collective action” (hereinafter, “class and collective action waiver”). Id. ¶ 5.

         B. Procedural History

         On October 25, 2016, Plaintiff filed a suit in California Superior Court for Santa Clara County in which Plaintiff sought damages for violation of various California Labor Code wage and hour provisions. See ECF No. 12 (“Request for Judicial Notice”) Ex. 1.[1] On February 17, 2017, the California Superior Court for Santa Clara County granted Plaintiffs Request for Dismissal of the Entire Action without prejudice. Id. Ex. 2.

         On March 9, 2017, Plaintiff filed the instant class and collective action suit. See Compl. Plaintiff brings six causes of action for (1) Failure to Pay Overtime Wages in violation of California Labor Code § 510, (2) Failure to Provide Meal Periods in violation of California Labor Code § 226.7, (3) Failure to Authorize Rest Periods in violation of California Labor Code § 226.7, (4) Failure to Pay Wages in a Timely Manner in Violation of California Labor Code § 203, (5) Unfair Competition in violation of California Business & Professions Code §§ 17200, et seq., and (6) Failure to Pay Overtime Wages in violation of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 206, et seq Id. ¶¶ 42-75. Plaintiff brings this suit on behalf of the following class: “Any and all persons who are or were employed in non-exempt positions, however titled, by Defendants in the state of California within four (4) years prior to the filing of the complaint in this action until resolution of this lawsuit.” Id. ¶ 22. Plaintiff also brings this suit as a FLSA collective action on behalf of the following collective class:

All hourly-paid, non-managerial employees of Flagship Facility Services, Inc., in the State of California from March 2014 to the present who both (a) have at least one Workweek for which they were paid for 40 or more hours, as reflected in Flagship Facility Services, Inc.'s payroll records, during the time period between July 2013 through the present, and (b) opt in to the proposed FLSA collective action.

Id. ¶ 28.

         On May 5, 2017, Defendant brought the instant Motion to Compel Arbitration and to Dismiss the Action or, in the Alternative, Stay the Action Pending Arbitration. See Mot. On May 19, 2017, Plaintiff filed an opposition, ECF No. 27 (“Opp'n”), and on May 26, 2017, Defendant filed a reply, ECF No. 29 (“Reply”).

         II. LEGAL STANDARD

         The Federal Arbitration Act (“FAA”) applies to arbitration agreements in any contract affecting interstate commerce. See Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 119 (2001); 9 U.S.C. § 2. 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-Center, West, Inc. v. Jackson, 561 U.S. 63 (2010) (quoting 9 U.S.C. § 3). If all claims in litigation are subject to a valid arbitration agreement, the court may dismiss or stay the case. See Hopkins & Carley, ALC v. Thomson Elite, 2011 WL 1327359, at *7-8 (N.D. Cal. Apr. 6, 2011).

         The FAA states that written arbitration agreements “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. In deciding whether a dispute is arbitrable, a court must answer two questions: (1) whether the parties agreed to arbitrate, and, if so, (2) whether the scope of that agreement to arbitrate encompasses the claims at issue. See Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000). If a party seeking arbitration establishes these two factors, the court must compel arbitration. Id; 9 U.S.C. § 4. “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). In cases where the parties “clearly and unmistakably intend to delegate the power to decide arbitrability to an arbitrator, ” the court's inquiry is “limited . . . [to] whether the assertion of arbitrability is ‘wholly groundless.'” Qualcomm Inc. v. Nokia Corp., 466 F.3d 1366, 1371 (Fed. Cir. 2006) (applying Ninth Circuit law). Nonetheless, “arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which [s]he has not agreed so to submit.” AT & T Techs., Inc. v. Commc 'ns Workers of Am., 475 U.S. 643, 648 (1986) (quoting Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582 (1960)).

         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 Le land Stanford Junior Univ., 489 U.S. 468, 475-79 (1989) (“[T]he FAA must be resolved with a healthy regard for the federal policy favoring arbitration.”). However, “state law is not entirely displaced from federal arbitration analysis.” Ticknor v. Choice Hotels Int l, Inc., 265 F.3d 931, 936-37 (9th Cir. 2001). When deciding whether the parties agreed to arbitrate a certain matter, courts generally apply ordinary state law principles of contract interpretation. First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995) (“Courts generally should apply ordinary state-law principles governing contract formation in deciding whether [an arbitration] agreement exists.”). 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 476, 478-79 (looking to whether state rules “offend[ed] the rule of liberal construction” in favor of arbitration). 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 agreement, 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. DISCUSSION

         Defendant argues that the Dispute Resolution Policy to which Defendant agreed requires arbitration on an individual basis. Mot. at 3. Defendant also argues that the arbitrability of the instant suit should be determined through arbitration in the first instance. Id. at 5.

         In response, Plaintiff does not dispute that Plaintiff and Defendant entered into an arbitration agreement. Plaintiff also does not dispute that the scope of the Dispute Resolution Policy includes the claims in the instant suit. Instead, Plaintiff argues that the Dispute Resolution Policy is substantively unconscionable because it includes a class and collective action waiver that interferes with Plaintiffs right to engage in concerted activity under the National Labor Relations Act (“NLRA”), 29 U.S.C. § 151 et seq. Plaintiff also argues that the Dispute Resolution Policy is substantively unconscionable because it lacks mutuality. Plaintiff further argues that the Dispute Resolution Policy is procedurally unconscionable because the Dispute Resolution Policy was provided to Plaintiff on a take-it-or-leave it basis. Finally, Plaintiff argues that compelling arbitration would result in impermissible claim splitting.

         The Court first addresses Defendant's argument that arbitrability should be decided through arbitration rather than through court proceedings. Second, the Court addresses whether the NLRA renders Plaintiffs claims substantively unconscionable. Third, the Court addresses whether the Dispute Resolution Policy is procedurally or substantively unconscionable for reasons other than the NLRA. Finally, the Court addresses whether compelling arbitration would result in impermissible claim splitting.

         A. Arbitrability Determination

         Defendant argues that “an arbitrator, and not this Court, should decide whether Plaintiffs claims must be resolved . . . in arbitration.” Mot. at 10. As noted above, in cases where the parties “clearly and unmistakably intend to delegate the power to decide arbitrability to an arbitrator, ” the court's inquiry is “limited . . . [to] whether the assertion of arbitrability is ‘wholly groundless.'” Qualcomm Inc., 466 F.3d at 1371. Defendant argues that the broad scope of the Dispute ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.