Armenta v. Staffworks, LLC

Filing 20

ORDER denying Defendant's 6 Motion to Compel Arbitration, denying 6 Motion to Strike Class Claims, denying 6 Motion to Stay Litigation. Signed by Judge Cynthia Bashant on 7/21/2017. (jah)

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1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 14 FLORA ARMENTA, individually and on behalf of others similarly situated, v. ORDER DENYING DEFENDANT’S MOTION TO COMPEL ARBITRATION, STRIKE CLASS CLAIMS, AND STAY LITIGATION STAFFWORKS, LLC, [ECF No. 6] Plaintiff, 15 16 17 Case No. 17-cv-00011-BAS-NLS Defendant. 18 19 20 Presently before the Court is Defendant Staffworks, LLC’s motion to compel 21 Plaintiff Flora Armenta’s individual claims to arbitration, strike her class claims, and 22 stay the case pending the outcome of arbitration. (ECF No. 6.) Plaintiff opposes. (ECF 23 No. 9.) 24 The Court finds this motion suitable for determination on the papers submitted 25 and without oral argument. See Fed. R. Civ. P. 78(b); Civ. L.R. 7.1(d)(1). For the 26 following reasons, the Court DENIES Defendant’s motion to compel arbitration, 27 strike class claims, and stay litigation. 28 –1– 17cv0011 1 I. BACKGROUND 2 Plaintiff Flora Armenta sought job placement through Defendant Staffworks, 3 LLC—a staffing agency that places applicants with various client companies. 4 (Milana-Slater Decl. ¶¶ 3, 6, ECF No. 6-2.) Prior to being assigned to work for a client 5 company, applicants visit Defendant’s office to fill out initial paperwork and 6 participate in a brief interview to determine the applicant’s skillset and desired 7 employment. (Id. ¶¶ 3–4.) 8 When Plaintiff visited Defendant’s office, she received and signed a one-page 9 Mandatory Arbitration Agreement (“Agreement”). (Milana-Slater Decl. ¶ 7, Ex. A.) 10 The Agreement states, in pertinent part: 11 MANDATORY ARBITRATION AGREEMENT 12 In connection with my employment at StaffWorks, LLC (“STAFFWORKS”), . . . I agree that any dispute or controversy which would otherwise require or allow [or] resort to any court or other governmental dispute resolution forum, between myself and STAFFWORKS (or its owners, partners, directors, officers, employees and parties affiliated with its employee benefit and health plans) arising from, related to, or having relationship or connection whatsoever with my seeking employment with, employment by, or other association with STAFFWORKS, whether based on tort, contract, statutory, or equitable law, or otherwise, (including claims for discrimination under the Fair Employment Housing Act) shall be submitted to and determined by binding arbitration in conformity with the procedures of the California Arbitration Act . . . . 13 14 15 16 17 18 19 20 21 22 (Id.) 23 Plaintiff later commenced this putative class and collective action against 24 Defendant under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., and 25 California labor law. (Compl. ¶¶ 56–92, ECF No. 1.) At the heart of Plaintiff’s claims 26 is the allegation that Defendant failed to pay Plaintiff and those similarly situated, 27 resulting in the underpayment of wages in violation of the FLSA and California labor 28 law. (Id. ¶ 5.) Based on the Agreement, Defendant now moves to compel arbitration –2– 17cv0011 1 of Plaintiff’s individual claims, strike her class claims, and stay this action pending 2 the outcome of arbitration. (ECF No. 6.) 3 4 II. LEGAL STANDARD 5 The Federal Arbitration Act (“FAA”) applies to disputes involving contracts 6 that touch upon interstate commerce or maritime law. 9 U.S.C. § 1; see also Circuit 7 City Stores, Inc. v. Adams, 532 U.S. 105, 109, 119 (2001); Yahoo! Inc. v. Iversen, 836 8 F. Supp. 2d 1007, 1009 (N.D. Cal. 2011). It reflects a “national policy favoring 9 arbitration,” Preston v. Ferrer, 552 U.S. 346, 349 (2008), and emphasizes that valid 10 arbitration agreements must be “rigorously enforce[d]” according to their terms, Am. 11 Exp. Co. v. Italian Colors Rest., 570 U.S. ---, 133 S. Ct. 2304, 2309 (2013). 12 Thus, the FAA commands that written arbitration agreements “shall be valid, 13 irrevocable, and enforceable, save upon such grounds as exist at law or in equity for 14 the revocation of any contract.” 9 U.S.C. § 2. The second clause, known as the FAA’s 15 “savings clause,” permits arbitration agreements to be invalidated by “generally 16 applicable contract defenses, such as fraud, duress, or unconscionability.” AT&T 17 Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011) (quoting Doctor’s Assoc., Inc. 18 v. Casarotto, 517 U.S. 681, 687 (1996)); see also Mortensen v. Bresnan Commc’ns, 19 LLC, 722 F.3d 1151, 1158 (9th Cir. 2013). 20 The court’s role under the FAA is limited to determining (1) whether a valid 21 arbitration agreement exists and, if so, (2) whether the scope of the agreement 22 encompasses the dispute at issue. See Chiron Corp. v. Ortho Diagnostic Sys., Inc., 23 207 F.3d 1126, 1130 (9th Cir. 2000). “If a party seeking arbitration establishes these 24 two factors, the court must compel arbitration.” Farrow v. Fujitsu Am., Inc., 37 F. 25 Supp. 3d 1115, 1119 (N.D. Cal. 2014) (citing Chiron Corp., 207 F.3d at 1130); see 26 also 9 U.S.C. § 4 (“[U]pon being satisfied that the making of the agreement for 27 arbitration or the failure to comply therewith is not in issue, the court shall make an 28 –3– 17cv0011 1 order directing the parties to proceed to arbitration in accordance with the terms of 2 the agreement.”). 3 4 III. ANALYSIS 5 Under the National Labor Relations Act, Agreements That Prevent 6 Employees from Engaging in Concerted Activity Are Illegal. 7 In its motion to compel arbitration, Defendant argues the Agreement is 8 enforceable and this Court should not only compel Plaintiff’s individual claims to 9 arbitration, but also strike her class allegations. (Mot. 3:14–12:21.) Plaintiff opposes, 10 asserting that the Agreement is unenforceable under Morris v. Ernst & Young, LLP, 11 834 F.3d 975, 979, 984–85 (9th Cir. 2016), cert. granted, 137 S. Ct. 809 (2017). 12 (Opp’n 2:13–28.) 13 In Morris v. Ernst & Young, the Ninth Circuit considered whether an employer 14 violates the National Labor Relations Act (“NLRA”) by requiring employees to sign 15 an agreement containing a concerted action waiver. 834 F.3d at 979. “This ‘concerted 16 action waiver’ required employees to (1) pursue legal claims against Ernst & Young 17 exclusively through arbitration and (2) arbitrate only as individuals and in ‘separate 18 proceedings.’” Id. Consequently, “employees could not initiate concerted legal claims 19 against the company in any forum—in court, in arbitration proceedings, or 20 elsewhere.” Id. 21 To determine whether the concerted action waiver was enforceable, the Ninth 22 Circuit examined the NLRA’s provisions regarding concerted activity. Morris, 834 23 F.3d at 981. Section 7 of the NLRA provides that “[e]mployees shall have the right to 24 self-organization, to form, join, or assist labor organizations, to bargain collectively 25 through representatives of their own choosing, and to engage in other concerted 26 activities for the purpose of collective bargaining or other mutual aid or protection.” 27 29 U.S.C. § 157. This “right of employees to act together”—concerted activity—“is 28 the essential, substantive right established by the NLRA.” Morris, 834 F.3d at 979 –4– 17cv0011 1 (emphasis omitted); see also Eastex, Inc. v. NLRB, 437 U.S. 556, 564–66 (1978) 2 (discussing Section 7). Further, under Section 8 of the NLRA, “[i]t shall be an unfair 3 labor practice for an employer . . . to interfere with, restrain, or coerce employees in 4 the exercise of” this right. See 29 U.S.C. § 158. “Section 8 has long been held to 5 prevent employers from circumventing the NLRA’s protection for concerted activity 6 by requiring employees to agree to individual activity in its place.” Morris, 834 F.3d 7 at 983 (emphasis omitted). 8 In applying these two sections, the Ninth Circuit reasoned that a labor-related 9 civil action—such as the class and collective action before it—is concerted activity 10 under Section 7 of the NLRA. Morris, 834 F.3d at 981–82. But the “separate 11 proceedings” clause in Ernst & Young’s arbitration agreement prevented “concerted 12 activity by employees in arbitration proceedings, and the requirement that employees 13 only use arbitration prevent[ed] the initiation of concerted legal action anywhere 14 else.” Id. at 984. Therefore, the separate proceedings clause interfered with concerted 15 activity in violation of Section 8 of the NLRA, and it could not be enforced. Id. 16 Thus, the Ninth Circuit held that an NLRA violation arises, regardless of the 17 forum, “so long as the exclusive forum provision is coupled with a restriction on 18 concerted activity in that forum.” Morris, 834 F.3d at 989. In other words, given that 19 employees have the right to pursue employment claims collectively, an agreement 20 violates the NLRA when employees are (1) limited to pursuing claims in only one 21 forum and (2) prevented from acting in concert in that forum. See id. at 983–84. 22 In this case, the Mandatory Arbitration Agreement limits Plaintiff to pursuing 23 employment claims in only one forum: arbitration. The Court must therefore 24 determine whether the Agreement also prevents Plaintiff from acting in concert with 25 other employees in that forum, i.e., participating in class arbitration. See Morris, 834 26 F.3d at 983–84. 27 // 28 // –5– 17cv0011 1 The Agreement Does Not Permit Class Arbitration. 2 1. 3 This Court, Not the Arbitrator, Decides Whether Class Arbitration Is Permitted. 4 Before analyzing whether the Agreement allows employees to act in concert in 5 arbitration, the Court must consider whether the parties have delegated this 6 determination to the arbitrator. Although federal policy favors arbitration agreements, 7 the Supreme Court “has made clear that there is an exception to this policy: The 8 question [of] whether the parties have submitted a particular dispute to 9 arbitration, i.e., the ‘question of arbitrability,’ is ‘an issue for judicial determination 10 [u]nless the parties clearly and unmistakably provide otherwise.’” Howsam v. Dean 11 Witter Reynolds, Inc., 537 U.S. 79, 83 (2002) (emphasis omitted) (quoting AT&T 12 Techs., Inc. v. Commc’ns Workers, 475 U.S. 643, 649 (1986)); accord Momot v. 13 Mastro, 652 F.3d 982, 988 (9th Cir. 2011). “Clear and unmistakable evidence of an 14 agreement to arbitrate arbitrability ‘might include . . . a course of conduct 15 demonstrating assent . . . or . . . an express agreement to do so.’” Mohamed v. Uber 16 Techs., Inc., 848 F.3d 1201, 1208 (9th Cir. 2016) (quoting Momot, 652 F.3d at 988). 17 For example, in Yahoo! Inc. v. Iversen, 836 F. Supp. 2d 1007, 1009 (N.D. Cal. 18 2011), the parties’ arbitration agreement incorporated the rules of the American 19 Arbitration Association (“AAA”). These rules included the AAA Supplementary 20 Rules for Class Arbitration, which provide that the arbitrator will decide “whether the 21 applicable arbitration clause permits the arbitration to proceed on behalf of or against 22 a class.” Id. at 1010–12. Thus, the court found that the parties clearly and 23 unmistakably delegated to the arbitrator the issue of whether class arbitration is 24 available by incorporating the rules of the AAA into the arbitration agreement. Id. at 25 1012; see also Accentcare, Inc. v. Jacobs, No. 15-03668-JSW, 2015 WL 6847909, at 26 *4 (N.D. Cal. Nov. 9, 2015) (finding that “the question of arbitrability may be, and 27 was, delegated to the arbitrator by the incorporation of the AAA rules”); accord Levy 28 –6– 17cv0011 1 v. Lytx, Inc., No. 16-cv-03090-BAS(BGS), 2017 WL 2797113, at *6 (S.D. Cal. June 2 28, 2017). 3 Here, there is no evidence that the parties have “clearly and unmistakably” 4 delegated to the arbitrator the question of arbitrability of class claims. See Momot, 5 652 F.3d at 988. Unlike the arbitration clause in Yahoo!—and as Defendant notes in 6 its motion to compel arbitration—the Agreement “contains no specific language 7 delegating any threshold question of arbitrability to the arbitrator, nor does it contain 8 a reference to any arbitration rules which do so.” (Mot. 11:16–17.)1 There is also no 9 indication that the parties’ course of conduct demonstrates their assent to arbitrate 10 whether class arbitration is permitted. Therefore, this Court finds no clear and 11 unmistakable evidence that the parties intended the arbitrator to decide whether the 12 agreement permits class arbitration.2 Accordingly, the Court will make this 13 determination. 14 2. 15 There Is No Contractual Basis for Class Arbitration. 16 Although the FAA evinces a strong presumption in favor of arbitration, the Act 17 “does not confer a right to compel arbitration of any dispute at any time.” Volt Info. 18 Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 U.S. 468, 474 (1989). 19 The FAA imposes a basic precept that arbitration “is a matter of consent, not 20 21 22 23 24 25 26 27 28 The Agreement does provide that any dispute “shall be submitted to and determined by binding arbitration in conformity with the procedures of the California Arbitration Act.” (MilanaSlater Decl. Ex. A.) “While the parties have agreed to arbitrate in conformity with the procedures of the California Arbitration Act, and while parties may elect to follow state procedures in lieu of the FAA’s procedures, the procedures the California Arbitration Act spells out do not specifically address the question of class arbitration availability.” See Sandquist v. Lebo Auto., Inc., 1 Cal. 5th 233, 250 (2016) (internal quotation marks and citations omitted). 2 Another exception to the judicial determination of arbitrability arises when a contract contains an arbitration clause and the plaintiff challenges the validity of the contract as a whole, as opposed to arguing specifically the arbitration clause is unenforceable. Bridge Fund Capital Corp. v. Fastbucks Franchise Corp., 622 F.3d 996, 1000 (9th Cir. 2010). This exception is inapplicable because Plaintiff is specifically challenging an arbitration provision, as opposed to challenging the validity of a broader agreement that also contains an arbitration provision—such as an employment agreement. See id. at 1000–01. 1 –7– 17cv0011 1 coercion.” Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 681 (2010) 2 (quoting Volt Info. Scis., 489 U.S. at 479); see also Yahoo! Inc., 836 F. Supp. 2d at 3 1009 (“Arbitration is a matter of contract, and the FAA places arbitration agreements 4 ‘on an equal footing with other contracts.’” (quoting Rent-A-Ctr., W., Inc. v. Jackson, 5 561 U.S. 63, 67 (2010)). 6 Accordingly, when deciding whether to enforce arbitration agreements, courts 7 and arbitrators must “give effect to the contractual rights and expectations of the 8 parties.” Volt Info. Scis., 489 U.S. at 479. “[I]t follows that a party may not be 9 compelled under the FAA to submit to class arbitration unless there is a contractual 10 basis for concluding that the party agreed to do so.” Stolt-Nielsen, 599 U.S. at 684 11 (emphasis in original); see also Oxford Health Plans LLC v. Sutter, 569 U.S. ---, 133 12 S.Ct. 2064, 2066 (2013) (“An arbitrator may employ class procedures only if the 13 parties have authorized them.”). Thus, if the “arbitration agreement is silent as to 14 whether class arbitration is permitted, it should not be presumed that the parties agreed 15 to submit to class arbitration.” Parvataneni v. E*Trade Fin. Corp., 967 F. Supp. 2d 16 1298, 1302 (N.D. Cal. 2013) (finding that the arbitration agreement did not provide 17 for class arbitration when there was no evidence that the parties intended to include 18 class arbitration in the terms of their agreement), order vacated on other grounds on 19 reconsideration at 2014 WL 12611301 (N.D. Cal. Nov. 7, 2014). 20 For instance, in Stolt-Nielsen, the parties “stipulated that the arbitration clause 21 was ‘silent’ with respect to class arbitration.” 559 U.S. at 668. “[T]he term ‘silent’ did 22 not simply mean that the clause made no express reference to class arbitration,” but 23 rather that “there’s been no agreement that has been reached on that issue.” Id. at 668– 24 69. Thus, because the parties stipulated there was no contractual basis for authorizing 25 class arbitration, the Supreme Court held they could not “be compelled to submit their 26 dispute to class arbitration.” Id. at 687. 27 The Ninth Circuit reached the same result in Morris for a different reason. 28 There, Ernst & Young’s concerted action waiver expressly required employees to –8– 17cv0011 1 “arbitrate only as individuals and in ‘separate proceedings.’” Morris, 834 F.3d at 979. 2 Consequently, there was not a contractual basis for concluding the parties agreed to 3 permit class arbitration, but rather the opposite—they affirmatively agreed to forbid 4 class arbitration. See id. at 979, 989. 5 The Mandatory Arbitration Agreement signed by Plaintiff makes no reference 6 to class proceedings. There is no “separate proceedings” clause like that encountered 7 in Morris. But at the same time, unlike Stolt-Nielsen, the parties have not stipulated 8 the agreement is “silent”—as that term is used in Stolt-Nielsen—on whether class 9 arbitration is available. 10 The result is still the same. There is no “contractual basis” for concluding the 11 parties agreed to permit class arbitration. See Stolt-Nielsen, 599 U.S. at 684. In 12 addition to the Agreement not mentioning class proceedings, neither party submits 13 evidence that the parties expected or intended class arbitration to be authorized. If 14 anything, the language in the Agreement suggests a presumption of individual 15 arbitration. It identifies that “any dispute or controversy which would otherwise 16 require or allow [or] resort to any court or other governmental dispute resolution 17 forum, between myself and STAFFWORKS . . . shall be submitted to and determined 18 by binding arbitration.” (Milana-Slater Decl. ¶ 7, Ex. A (emphasis added).) 19 Accordingly, the Court finds class arbitration is not available because there is no 20 contractual basis for concluding the parties agreed to authorize it. See Stolt-Nielsen, 21 599 U.S. at 684. 22 23 Under the NLRA and Morris, the Arbitration Agreement Is Illegal 24 and Unenforceable. 25 The Court’s analysis above brings this case within the scope of the Ninth 26 Circuit’s decision in Morris. The Mandatory Arbitration Agreement (1) limits 27 Plaintiff to pursuing claims only in arbitration and (2) does not allow her to act in 28 concert in that forum because the Agreement does not permit class arbitration. –9– 17cv0011 1 Nonetheless, Defendant advances several arguments for why it believes this case is 2 distinguishable from Morris, all of which the Court finds unconvincing. 3 Initially, Defendant argues that the holding in Morris is limited to instances 4 where employers attempt to circumvent the NLRA via an express concerted action 5 waiver. (Reply 1:27–2:3.) Then, in attempting to distinguish this case, Defendant 6 states: “Without putting too fine a point on it, [Defendant] is not seeking the 7 enforcement of a concerted action waiver, because no such waiver exists here. 8 [Defendant] is simply asking the Court to enforce the parties’ agreement and require 9 [Plaintiff] to arbitrate her claims.” (Id. 2:12–15.) This is a hollow distinction. 10 Defendant is seeking to not only compel arbitration, but also strike Plaintiff’s class 11 claims. Thus, even if the Agreement does not contain an express concerted action 12 waiver, Defendant is seeking to obtain the same result that was forbidden in Morris— 13 an order (1) limiting Plaintiff to arbitration and (2) precluding her from engaging in 14 concerted activity in arbitration. See 834 F.3d at 979, 983–84. In other words, 15 Defendant’s motion is an unlawful attempt to circumvent the NLRA. 16 The National Labor Relations Board’s decisions are in accord.3 It “has 17 repeatedly held that a mandatory arbitration agreement is unlawful if, despite its 18 silence regarding class or collective actions, the employer has used the agreement to 19 preclude employees from pursuing class or collective employment related claims in 20 any forum.” Select Temps., LLC, 31-CA-157821, 2016 WL 4772318 (N.L.R.B. Div. 21 of Judges Sept. 13, 2016). For example, in Countrywide Financial Corp., 362 22 N.L.R.B. No. 165 (Aug. 14, 2015), the Board found that by filing a motion to compel 23 individual arbitration, the respondents effectively applied an illegal construction of 24 the arbitration agreement that required the employees to resolve all employment 25 26 27 28 When examining the NLRA’s provisions, the “Board’s reasonable interpretations of the NLRA command deference.” Morris, 834 F.3d at 981; see also N.L.R.B. v. City Disposal Sys. Inc., 465 U.S. 822, 829 (1984) (“[T]he task of defining the scope of § 7 ‘is for the Board to perform in the first instance as it considers the wide variety of cases that come before it.’” (quoting Eastex, 437 U.S. at 568)). 3 – 10 – 17cv0011 1 claims through individual arbitration. “By taking steps to enforce the Agreement in 2 Federal district court when the employees filed their collective claims . . . the 3 respondents maintained and enforced the Agreement in violation of Section 8(a)(1).” 4 Countrywide Fin. Corp., 362 N.L.R.B. No. 165, at *6; see also D. R. Horton, Inc., 5 357 N.L.R.B. 2277, 2288 (2012) (“[E]mployers may not compel employees to waive 6 their NLRA right to collectively pursue litigation of employment claims in all forums, 7 arbitral and judicial.”); c.f. Martin Luther Mem’l Home, Inc., 343 N.L.R.B. No. 75 8 (Nov. 19, 2004) (acknowledging that a workplace rule that does not explicitly restrict 9 protected activity can be unlawful if the rule is applied to restrict the exercise of 10 Section 7 rights). 11 Similarly here, by moving to compel individual arbitration and strike Plaintiff’s 12 class claims, Defendant is seeking to enforce a construction of the Agreement that 13 violates Section 8 of the NLRA. Denying Plaintiff the opportunity to pursue her class 14 claims would implicate the antithesis of Section 7’s substantive right to pursue 15 concerted work-related legal claims. Thus, the Agreement as sought to be enforced is 16 illegal under Section 8 for the same reasons articulated in Morris and the Board’s 17 decisions discussed above. Accordingly, the Court is unpersuaded by Defendant’s 18 initial argument that the outcome in this case should be different than Morris simply 19 because the Agreement does not contain an express concerted action waiver. 20 In addition, Defendant cites to Stolt-Nielson and Johnmohommadi v. 21 Bloomingdale’s, Inc., 755 F.3d 1072, 1076 (9th Cir. 2014), to argue that Plaintiff 22 could waive her right to engage in concerted activity. (Reply 2:4–8.) But both these 23 cases are distinguishable. Stolt-Nielsen involved an arbitration agreement in the 24 context of an antitrust suit alleging owners of international parcel tankers engaged in 25 price fixing. 559 U.S. at 667. The case therefore did not implicate employees’ right 26 under the NLRA to engage in concerted activity—the lynchpin of this case and 27 Morris. 28 – 11 – 17cv0011 1 As for Johnmohommadi, that decision analyzed an arbitration agreement that 2 was voluntary. 755 F.3d at 1077. The Ninth Circuit noted that the plaintiff “had the 3 right to opt out of the arbitration agreement, and had she done so she would be free to 4 pursue this class action in court.” Id. Thus, the court reasoned that the plaintiff, 5 “[h]aving freely elected to arbitrate employment-related disputes on an individual 6 basis, without interference from [the employer],” could not claim the agreement 7 violated the NLRA. Id. The same cannot be said here. Defendant’s policy required 8 Plaintiff to come into its office to complete “the initial paperwork,” including the 9 “MANDATORY ARBITRATION AGREEMENT.” (Milana-Slater Decl. ¶¶ 6–7, 10 Ex. A.) Further, nothing in the Agreement indicates Plaintiff had the right to opt out. 11 (See id. Ex. A.) See also Rivera v. Saul Chevrolet, Inc., No. 16-CV-05966-LHK, 2017 12 WL 1862509, at *4 (N.D. Cal. May 9, 2017) (Koh, J.) (“Neither party has presented 13 any evidence here that Plaintiff was provided an opportunity to opt out of the 14 Arbitration Agreement . . . . Nor does the Arbitration Agreement itself contain a 15 procedure for opting out.”). Accordingly, Johnmohommadi is also distinguishable. 16 See Morris, 834 F.3d at 982 n.4 (explaining that “there was no § 8 violation in 17 Johnmohammadi . . . because the employee there could have opted out of the 18 individual dispute resolution agreement and chose not to”). 19 Last, Defendant cites to an unpublished Ninth Circuit decision, Eshagh v. 20 Terminix International Co., 588 F. App’x 703, 704 (9th Cir. 2014), to support its 21 belief that this Court can strike Plaintiff’s class claims and compel individual 22 arbitration. (Reply 2:16–20.) The Court is again unconvinced. Eshagh is not binding 23 precedent on this Court. See 9th Cir. R. 36-3. Moreover, Eshagh predates the decision 24 in Morris and does not discuss Section 7 or Section 8 of the NLRA. Morris, 834 F.3d 25 at 982–83. 26 Accordingly, Plaintiff’s action falls within the scope of Morris, and the Court 27 finds Defendant’s attempts to distinguish this case unpersuasive. The Agreement is 28 therefore unenforceable. See 29 U.S.C. § 158; Morris, 834 F.3d at 990; Pataky v. – 12 – 17cv0011 1 Brigantine, Inc., No. 17-cv-00352-GPC-AGS, 2017 WL 1682681, at *8 (S.D. Cal. 2 May 3, 2017) (Curiel, J.) (denying motion to compel individual arbitration based on 3 Morris); accord Ross v. P.J. Pizza San Diego, LLC., No. 16-cv-02330-L-JMA, 2017 4 WL 1957584, at *2 (S.D. Cal. May 11, 2017) (Lorenz, J.). 5 6 IV. CONCLUSION & ORDER 7 In sum, Section 7 of the NLRA affords Plaintiff the right to engage in concerted 8 activity, and Section 8 forbids Defendant from interfering with this right. Based on 9 Morris, an employer violates Section 8 when it limits employees to pursuing 10 employment claims in one forum and precludes them from acting in concert in that 11 forum. Although there is no express concerted action waiver in the Agreement, 12 Defendant’s attempt to compel arbitration and strike class claims is an attempt to limit 13 Plaintiff to arbitration and prevent her from acting in concert in arbitration. To do so 14 would violate her Section 7 rights. Because Defendant is seeking to enforce the 15 Agreement in violation of Section 8, this Court finds the Agreement to be illegal and 16 unenforceable. 17 18 19 In light of the foregoing, the Court DENIES Defendant’s motion to compel arbitration, strike class claims, and stay litigation (ECF No. 6). IT IS SO ORDERED. 20 21 DATED: July 21, 2017 22 23 24 25 26 27 28 – 13 – 17cv0011

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