Cotrina Sanders v. Telacu Construction Management Case No. CV 19-766-DMG (JCx) United States District Court, C.D. California Filed October 09, 2019 Counsel Matthew Scott Parmet, Parmet PC, Walnut, CA, James A. Jones, Pro Hac Vice, Brucker Burch PLLC, Michael A. Josephson, Pro Hac Vice, Josephson Dunlap LLP, Michael T. Slobin, Pro Hac Vice, Ricardo J. Prieto, Pro Hac Vice, Shellist Lazarz Slobin LLP, Richard J. Burch, Pro Hac Vice, Bruckner Burch PLLC, Houston, TX, Melinda Arbuckle, Shellist Lazarz Slobin LLP, San Diego, CA, for Cotrina Sanders. Jack S. Sholkoff, Mazen I. Khatib, Ogletree Deakins Nash Smoak and Stewart PC, Los Angeles, CA, for Telacu Construction Management Gee, Dolly M., United States District Judge Proceedings: IN CHAMBERS - ORDER RE DEFENDANT'S MOTION TO COMPEL ARBITRATION [33] AND PLAINTIFF'S MOTION FOR PROTECTIVE ORDER [35] *1 On January 31, 2019, Plaintiff filed a Complaint against Defendant alleging violations of: (1) the Fair Labor Standards Act (“FLSA”); and (2) the Virgin Islands Fair Labor Standards Act. Compl. [Doc. # 1]. On April 17, 2019, Defendant filed a Motion to Compel Arbitration. [Doc. # 33.] On April 19, 2019, Plaintiff filed a Motion for Protective Order. [Doc. # 35.] Thereafter, the Court took the motions under submission. [Doc. # 40]; see also Fed. R. Civ. P. 78(b); L.R. 7-15. For the reasons discussed herein, the Court GRANTS IN PART Defendant's Motion to Compel Arbitration and DENIES Plaintiff's Motion for Protective Order. I. MOTION TO COMPEL ARBITRATION A. FACTUAL BACKGROUND According to Plaintiff's allegations, Defendant is a provider of construction management services for capital improvement projects. Compl. ¶ 23. Plaintiff was employed by Defendant in the Virgin Islands as an hourly employee from November 2018 to January 2019. Id. ¶¶ 12-13, 25-27. Plaintiff worked more than 40 hours on multiple workweeks during her employment with Defendant, but Defendant paid Plaintiff her normal hourly rate for all hours worked. Id. ¶¶ 32-39. Plaintiff seeks to bring a collective action under section 216(b) of the FLSA, and a class action under Rule 23 of the Federal Rules of Civil Procedure, on behalf of hourly employees who did not receive overtime wages despite working in excess of the time limits set forth in the FLSA and VIFLSA. Since Plaintiff filed this action, nine additional plaintiffs have opted into the collection action (collectively, “the plaintiffs”). See Notices of Filing Consent [Doc. ## 20, 21, 28, 31]. Defendant contends that it requires of all employees to execute an arbitration agreement (“the Agreement”) either when the employee applies for a position with Defendant, or shortly after the employment commences. The Agreement provides, in relevant part: Arbitration I and the Company agree that any claim, dispute, or controversy (including, but not limited to, any and all claims of discrimination and harassment) which would otherwise require or allow resort to any court or other governmental dispute resolution forum between me and the Company ... arising from, related to, or having any relationship or connection whatsoever with me seeking employment with, employment by, or other association with, the Company, whether based on tort, contract, statutory, or equitable law, or otherwise, shall be submitted to and determined exclusively by binding arbitration pursuant to the Federal Arbitration Act. I understand that if I do not agree to arbitration, I am agreeing to withdraw my employment application and my application will not be considered. Motion Ex. A (Doc. # 33-2) at 5-6. The Agreement also contains a provision prohibiting class actions or collective proceedings: Claims Must Be Brought In Individual Capacity And Not As A Class, Collective, or Representative Proceedings All claims must be brought in a party's individual capacity, and not as a class member, or class or other type of representative, in any purported class, collective or representative proceeding. The arbitrator may not consolidate more than one person's claims, and may not otherwise preside over any form of a class, collective, representative or private attorney general proceeding. The Court, and not the arbitrator, shall decide whether any class, representative or multiparty claims may be sent to arbitration. If any claims are deemed not to be arbitrable by the Court, while some claims are deemed arbitrable by the Court, then the Parties agree that the arbitrable claims will be sent to arbitration for resolution and the non-arbitrable claims will be severed and, if pending in court, will be stayed until the final resolution of the claims in arbitration. The decision whether a matter may be sent to arbitration, however, will always be decided by the Court. *2 Id. at 6. For each of the plaintiffs, Defendant has submitted a copy of the Agreement bearing the plaintiff's name and signature. Motion Exs. B-K [Doc. # 33-2]. B. LEGAL STANDARD The Federal Arbitration Act (“FAA”) provides that written arbitration agreements in contracts “evidencing a transaction involving commerce ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011) (quoting 9 U.S.C. § 2). “The basic role for courts under the FAA is to determine ‘(1) whether a valid agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue.” ’ Kilgore v. KeyBank Nat'l Ass'n, 718 F.3d 1052, 1058 (9th Cir. 2013) (en banc) (quoting Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000)). C. DISCUSSION Defendant moves to compel arbitration on the grounds that each of the plaintiffs signed the arbitration agreement, and the arbitration agreement covers wage claims. Plaintiff raises two arguments in opposition. First, Plaintiff argues that, for seven of the nine plaintiffs,[1] Defendant failed to provide sufficient evidence to show that a valid agreement to arbitrate exists. Second, Plaintiff argues that to the extent any arbitration agreements exist, they would not apply to those plaintiffs who signed the agreements after they began working for Defendant. 1. Whether Valid Agreements to Arbitrate Exist Where a party contests “the formation of the parties' arbitration agreement ... ‘the court’ must resolve the disagreement.” Granite Rock Co. v. Int'l Bhd. of Teamsters, 561 U.S. 287, 299-300 (2010) (quoting First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943 (1995)). “When deciding whether the parties agreed to arbitrate” courts “should apply ordinary state-law principles that govern the formation of contracts.” First Options, 514 U.S. at 944. Under California law,[2] “the party seeking to compel arbitration has the burden of proving the existence of an agreement to arbitrate by a preponderance of the evidence.” Knutson v. Sirius XM Radio Inc., 771 F.3d 559, 565 (9th Cir. 2014) (citing Rosenthal v. Great W. Fin. Sec. Corp., 14 Cal. 4th 394, 413 (1996)). The party seeking to introduce an arbitration agreement meets its initial burden by introducing “a copy of the purported arbitration agreement purportedly bearing the other party's signature.” Espejo v. Southern Cal. Permanente Med. Group, 246 Cal. App. 4th 1047, 1060 (2016); see also Molecular Analytical Systems v. Ciphergen Biosystems, Inc., 186 Cal. App. 4th 696, 710 (2010) (holding that party “made a sufficient prima facie showing of an agreement to arbitrate” through allegations of complaint and copy of purported agreement); Condee v. Longwood Mgmt. Corp., 88 Cal. App. 4th 215, 219 (2001) (holding that party seeking to introduce arbitration agreement need only provide the court with “a copy or recitation of its terms.”) If the party opposing arbitration challenges the validity of the signature, however, the proponent is “required to establish by a preponderance of the evidence that the signature [is] authentic.” Espejo, 246 Cal. App. 4th at 1060; Ruiz v. Moss Bros. Auto Group, Inc., 232 Cal. App. 4th 836, 843-44 (2014) (holding that proponent of arbitration agreement bearing only party's printed name and electronic time stamp was required to show that other party executed the agreement). *3 As a preliminary matter, Plaintiff argues that Defendant failed to authenticate the purported arbitration agreements. Assuming Defendant is required to authenticate the agreements under the Federal Rules of Evidence,[3] the Court finds that Defendant has done so. Rule 901 requires “the proponent [to] produce evidence sufficient to support a finding that the item is what the proponent claims it is.” Testimony from a knowledgeable witness “satisfies this requirement.” Fed. R. Evid. 901(b)(1). Defendant's Human Resources manager submitted a declaration attesting to when she obtained each of the arbitration agreements, most of which she personally obtained from each plaintiff. Brito Dec. [Doc. # 39-7] ¶¶ 4-13. This is sufficient to authenticate the purported agreements as those maintained in the plaintiffs' personnel files. For seven of the plaintiffs, Defendant submitted an email transmitted from the plaintiff's email address to Defendant attaching the signed agreement.[4] Reply Exs. E-K [Doc. # 39-8]. Plaintiff's only evidence in opposition is that some of these plaintiffs “do not recall” signing the agreement. See Plaintiffs' Decs. [Doc. # 37-1-5]. For each of these plaintiffs, Defendant easily meets its burden of proving an agreement to arbitrate by a preponderance of the evidence. For Plaintiff Damond, Defendant's Senior Vice President, Jay Bell, submitted a declaration stating that he conducted a staff meeting for new hires which Damond attended. Bell asserts that he collected executed arbitration agreements from the new hires at that meeting and identified Damond in a photograph taken during the meeting. Bell Dec. [Doc. # 39-5] ¶ 4-5 & Reply Ex. C [Doc. # 39-6]. Damond does not dispute that the signature appearing on the agreement bearing her name is her signature. Damond only states that she does not recall signing the agreement. Again, Defendant meets its burden of proving an agreement to arbitrate by a preponderance of the evidence. See Joseph E. Di Loreto, Inc. v. O'Neil, 1 Cal. App. 4th 149, 160 (1991) (holding that, where the defendant “never unequivocally denied” signature appearing on contract as her own, the defendant's failure to recall signing an agreement was “insufficient to create triable issue of fact” as to agreement's validity).[5] Plaintiff Martinez claims that the signature on the purported arbitration agreement bearing his name is not his signature. Martinez Dec. [Doc. # 37-7] ¶¶ 4-6. Martinez also submits the employment agreement he signed with Defendant, and argues the signature on that document is different from the one appearing on the purported arbitration agreement. Id., Ex. A. Unlike how it handled the other plaintiffs, Defendant did not provide any evidence demonstrating when it collected Martinez's purported arbitration agreement.[6] Defendant does provide, however, other documents which it contends Martinez signed when he began employment with Defendant, and argues that the signature on these documents “looks very similar” to the signature on the purported arbitration agreement. Reply [Doc. # 39] at 10; Reply Ex. B [Doc. # 39-4]. Because Defendant submitted these additional documents with its reply, Martinez has not had an opportunity to respond. Although the Court notes similarities between the signatures, it is difficult to determine whether the signatures were more likely than not created by the same person without additional contextual information or the aid of expert testimony. Defendant has requested that the Court order further discovery and a summary trial on this limited issue if the Court is not inclined to grant the motion to compel. Reply at 14. The Court finds that additional discovery is warranted, and therefore grants Defendant's request. 2. The Arbitration Agreements Encompass the Claims at Issue *4 The arbitration agreement is part of a document entitled “Applicant's Statement and Agreement.” The following language appears immediately after the arbitration provision: I understand that if I do not agree to arbitration, I am agreeing to withdraw my employment application and my application will not be considered. Motion Ex. A at 5-6. Plaintiff argues that, because the document refers to “applicants” and discusses withdrawal of the employment application, the arbitration agreement only binds applicants – i.e., those employees who signed the agreement before they were hired by Defendant. Plaintiff argues that any plaintiff who signed the agreement after they had already accepted an offer of employment is not bound by the agreement. Under both federal and California state law, Where [a] contract contains an arbitration clause, there is a presumption of arbitrability in the sense that ‘[a]n order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.’ ” AT&T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643, 650 (1986) (second alteration in original) (quoting United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-583 (1960)); see also O'Malley v. Wilshire Oil Co., 59 Cal. 2d 482, 491 (1963) (quoting United Steelworkers of Am.). The presumption in favor of arbitrability “is particularly applicable” where the arbitration clause is broad. AT&T Techs., Inc., 475 U.S. at 650; see also Salgado v. Carrows Rests., Inc., 33 Cal. App. 5th 356, 361 (2019) (quoting AT&T Techs.). The Court does not agree that the Agreement applies only to those Plaintiffs who signed the arbitration agreement before they accepted employment. First, the language of the arbitration provision is very broad. The (prospective) employee and Defendant agree to arbitrate any claim: arising from, related to, or having any relationship or connection whatsoever with me seeking employment with, employment by, or other association with [Defendant], whether based on tort, contract, statutory, or equitable law, or otherwise. The California Supreme Court has stated that this exact language is “intended to sweep in” any disputes arising from an individual's employment. Sandquist v. Lebo Auto., Inc., 1 Cal. 5th 233, 246 (2016); see also Lucas v. Michael Kors (USA), Inc., No. 16-cv-1608, 2018 WL 6177225, at *1, 7-8 (holding that similar language encompassed wage and hour claims, even though not specifically mentioned). Second, the following statement appears in bold font after the arbitration provisions, and immediately before the signature line: “I hereby acknowledge that I have read, understand, and agree to be legally bound to all of the above terms.” The statement that the signatory “agree[s] to be legally bound to all of the above terms” suggests that the arbitration provision applies to any person signing the agreement, not just prospective employees. Finally, if the Court were to accept Plaintiff's argument, it would mean that any person who signed the Agreement after they accepted employment intended to sign a document that had no legal effect. The Court does not find this plausible, nor is this interpretation favored under California law. See Cal. Civ. Code § 3541 (“An interpretation which gives effect is preferred to one which makes void.”); see also id. § 1643 (“A contract must receive such an interpretation as will make it lawful, operative ... and capable of being carried into effect, if it can be done without violating the intention of the parties.”) (emphasis added). The reasonable interpretation is that those already employed intended for the provisions to apply and bind them when they signed the Agreement, even though the document was entitled Applicant's Statement and Agreement. * * * *5 For the reasons stated herein, Defendant has shown by a preponderance of the evidence that all Plaintiffs, except Plaintiff Martinez, agreed to an arbitration agreement with Defendant, and the agreements govern the claims at issue. The Court withholds its decision as to Plaintiff Martinez until after the parties have conducted some discovery relating to this issue. 3. Defendant's Motion to Dismiss or Stay Defendant requests that the Court dismiss or, in the alternative, stay the action if it grants the motion to compel arbitration. Because the Court does not grant Defendant's motion to compel arbitration as to all Plaintiffs, the Court stays the action only as to those Plaintiffs who have been compelled to arbitration at this time. II. MOTION FOR PROTECTIVE ORDER A. FACTUAL BACKGROUND Plaintiff Lane contends that Defendant has taken retaliatory action against him for joining this action. Lane did storm cleanup and recovery work for Defendant in the U.S. Virgin Islands. Lane Dec. [Doc. # 35-1] ¶ 2. Lane asserts that Defendant's Senior Vice President, Jay Bell, informed him in February 2016 that he was “busily looking” for Lane's next opportunity, and that more work would be coming in the Caribbean. Id. ¶¶ 4-5. Shortly after Lane joined this action, Bell informed Lane that Defendant would have no more work for him, without elaborating. Id. ¶¶ 8-9. Bell asserts that Defendant only hired Lane for a specific project in the U.S. Virgin Islands, and that Lane's employment with Defendant terminated when he completed the project. Bell Dec. [Doc. # 36-1] ¶ 2. Bell also asserts that, since he communicated with Lane regarding potential opportunities, Defendant has not obtained new contracts in Puerto Rico or the U.S. Virgin Islands as originally expected, and Defendant has not had any openings for the position previously held by Lane. Id. ¶¶ 2, 6, 8. Bell also asserts that he would consider Bell if an appropriate position opened. Id. ¶ 10. Plaintiff seeks a protective order restoring Lane's status as eligible for rehire and prohibiting Defendant from communicating with current or former employees about matters relating to this lawsuit. Plaintiff also asks this Court to require Defendant to provide contact information for all similarly situated workers so that Plaintiff may issue a notice which informs workers that they may contact Plaintiff's attorneys if they believe Defendant retaliated against them or spoke to them about this action. B. LEGAL STANDARD “[A] district court has both the duty and the broad authority to exercise control over a class action and to enter appropriate orders governing the conduct of counsel and parties.” Gulf Oil Co. v. Bernard, 452 U.S. 89, 100 (1981). Potential abuses include “[u]napproved communications to class members that misrepresent the status or effect of the pending action.” Id. at 101 n. 12 (quoting Waldo v. Lakeshore Estates, Inc., 433 F. Supp. 782 (E.D. La. 1977)) (alteration in original). The court may issue “an order limiting communications between parties and potential class members” so long as it is “based on a clear record and specific findings that reflect a weighing of the need for a limitation and the potential interference with the rights of the parties.” Id. at 101. “In addition, such a weighing—identifying the potential abuses being addressed—should result in a carefully drawn order that limits speech as little as possible, consistent with the rights of the parties under the circumstances.” Id. at 102. C. DISCUSSION *6 Here, Plaintiff does not sufficiently support the requested relief. Plaintiff does not provide any evidence that Defendant communicated with any plaintiff or putative class member about the litigation. This weighs heavily against issuing any order prohibiting Defendant from communicating with class members about the litigation or requiring Defendant to provide Plaintiff with the names of class members to issue a corrective notice. While Plaintiff has provided some evidence that Defendant took retaliatory action against Lane, the Court finds the evidence insufficient to support any of the requested relief. Most importantly, Lane is the only plaintiff that has alleged any retaliatory action. Courts generally have taken broad-based corrective action only when a defendant has reached out to numerous putative class members to discourage participation in litigation. See, e.g., Marino v. CACafe, Inc., No. 16-cv-6291, 2017 WL 1540717, at *1-2 (N.D. Cal. April 28, 2017) (holding that collective notice was appropriate where defendant emailed putative class members offering $500 incentive for release of all claims, without informing members about the existence of class action); Guifi Li v. A Perfect Day Franchise, 270 F.R.D. 509, 518 (N.D. Cal. 2010) (holding that corrective notice was appropriate where defendants presented opt-out forms to multiple workers during mandatory, one-on-one meetings). Plaintiff has provided no evidence that Defendant has taken any negative actions against any other plaintiff or potential plaintiff, or generally attempted to dissuade potential plaintiffs from participating in the litigation. The Court notes, without deciding, that it is unclear whether Lane is protected under the FLSA. It is undisputed that Lane was not Defendant's employee at the time of the alleged retaliatory action. Lane Dec. ¶ 1. As one district court has stated, “[t]he few courts to consider the issue have uniformly held that job applicants are not employees under the FLSA,” and therefore not protected by the anti-retaliation provisions. Saini v. Motion Recruitment Partners, No. SACV 16-01534, 2017 WL 1536276, at *5 (C.D. Cal. March 6, 2017) (citing Dellinger v. Sci. Applications Int'l Corp., 649 F.3d 226, 230 (4th Cir. 2011); Harper v. San Luis Valley Reg'l Med. Ctr., 848 F. Supp. 911, 913 (D. Colo. 1994); Glover v. City of N. Charleston, 942 F. Supp. 243, 247 (D.S.C. 1996)). Plaintiff argues that it is inapposite whether Lane would ultimately prevail on an FLSA claim, because what matters is Defendant's threat of “economic reprisal” against Lane. Reply at 5. The Court does not necessarily hold that Plaintiff must show a cognizable FLSA claim to support a request for a protective order or corrective notice, but finds it relevant for purposes of considering the broad relief requested that the only alleged retaliatory action for which Plaintiff has provided any evidence, albeit weak evidence, is against a prospective employee. For the foregoing reasons, the Court does not find that there is sufficient evidence supporting Plaintiff's requested relief at this time. III. CONCLUSION For the foregoing reasons, IT IS HEREBY ORDERED as follows: 1. Defendant's Motion to Compel Arbitration is GRANTED as to all Plaintiffs, except Plaintiff Martinez, and this action is STAYED as to those Plaintiffs. The parties shall file a Joint Status Report within ten days after the receipt of an arbitral ruling or other disposition of their dispute and inform the Court how they wish to proceed with this case; *7 2. The Court GRANTS Defendant's request for additional discovery as to Plaintiff Martinez on the limited issue of whether the parties agreed to arbitrate the claims at issue and to file supplemental briefing with regard to whether Plaintiff Martinez should be compelled to arbitrate his claims. Limited discovery shall be completed by November 22, 2019. Defendant's supplemental briefing shall be filed by December 6, 2019, and Plaintiff's supplemental response shall be filed by December 13, 2019. Thereafter, the Motion to Compel Arbitration as to Plaintiff Martinez will be taken under submission; and 3. Plaintiff's Motion for Protective Order is DENIED. Footnotes [1] For Plaintiffs Walker and Gil, Plaintiff does not contend that no valid arbitration agreement exists. These Plaintiffs therefore have conceded this issue. [2] The parties appear to agree that California law governs whether the parties agreed to arbitrate. See Opp. [Doc. # 37] at 2; Reply [Doc. # 39] at 4. [3] Under California law, the general evidentiary rules regarding authentication do not apply to a motion to compel arbitration. Condee, 88 Cal. App. 4th at 218 (holding that in a motion to compel arbitration, “it is not necessary to follow the normal procedures of document authentication.”) (citing Cal. Rules of Court, rule 371): see also Espejo, 246 Cal. App. 4th at 1059-60 (approving rule annunciated in Condee). [4] The seven plaintiffs are Sanders, Valencia, Lane, Brown, Bustos, Walker, and Gil. The emails sent from these plaintiffs also authenticate the arbitration agreements. [5] Plaintiff cites Ruiz for the proposition that a party's failure to recall signing an agreement is enough to challenge the validity of the signature. The Court does not read Ruiz so broadly. Ruiz involved an arbitration agreement allegedly completed electronically, where the name of plaintiff appeared in print on the signature line. See id. at 843-44. The Court of Appeal held that, in light of defendant's failure to provide any evidence describing how it could infer that plaintiff was the person who filled out the agreement, defendant failed to meet its burden of proving plaintiff filled out the agreement. See id. at 844. Here, however, Damond declined to disclaim a unique signature as her own. This case is much more analogous to Di Loreto. [6] Defendant's human resources manager simply asserts she received it from another employee of Defendant. Brito Dec. ¶ 12.