2014-00158976-CU-OE

James Freeman vs. Supershuttle International Inc

Nature of Proceeding:      Motion to Compel Arbitration and Stay Proceedings

Filed By:   Stedfield, Brandyn E.

Defendants SuperShuttle International, Inc., et al.’s (collectively “SSI”) motion to
compel arbitration and to stay this civil action is GRANTED, as follows.

Moving counsel is admonished because the notice of motion does not provide notice
of the Court’s tentative ruling system, as required by Local Rule 1.06, and does not
specify the correct department or time for hearing of this matter.  Moving counsel is
directed to contact opposing counsel and advise him/her of Local Rule 1.06 and the
Court’s tentative ruling procedure and the manner to request a hearing, along with the
correct department and time for hearing of this matter.  If moving counsel is unable
to contact opposing counsel prior to hearing, moving counsel is ordered to
appear at the hearing in person or by telephone.

This action arises out of plaintiff’s employment by SSI.  The complaint purports to
assert causes of action for wrongful termination, discrimination, retaliation,
harassment, failure to prevent discrimination and harassment, and negligent
hiring/retention.

SSI now insists that plaintiff is compelled to submit all his employment claims to
binding arbitration pursuant to the arbitration provision found in SSI’s employee  handbook which plaintiff acknowledges receiving upon the commencement of his
employment by SSI.  Accordingly, SSI requests the Court to stay the present action
and compel arbitration of all claims alleged in the complaint.

In opposition, plaintiff argues that the arbitration provision is procedurally and
substantively unconscionable, thereby rendering it unenforceable here.  More
specifically, plaintiff maintains that (1) the arbitration provision is procedurally
unconscionable because it was offered on a take-it-or-leave-it basis with plaintiff
having no opportunity to negotiate its terms and having not been advised of the
possibility of negotiating its terms; (2) the arbitration clause is substantively
unconscionable because it unreasonably relieves SSI from the obligation to arbitrate
any claims it may have against plaintiff and because SSI enjoys the unilateral right to
modify the employee handbook, including the arbitration provision; and (3) SSI did not
include in the handbook itself the rules applicable to arbitration and effectively forced
plaintiff to do independent research to determine what the rules provide.  It is worth
noting here that plaintiff submitted no evidence of his own to support his contentions.

At the outset, the Court notes that arbitration must be compelled where there is a valid,
binding arbitration agreement unless the opposing party proves the agreement is
unenforceable on unconscionability or other grounds. (See, e.g., Armendariz v.
Foundation Health (2000) 24 Cal.4th 83, 96-100, 114;  Gatton v. T-Mobile USA (2007)
152 Cal.App.4th 571, 579.)  As plaintiff concedes he signed the acknowledgement of
receipt of the employee handbook and concedes receipt of the handbook which
contains the arbitration provision sought to be enforced here, the Court finds there is a
valid, binding agreement which must be enforced unless plaintiff carries his burden of
proving the arbitration provision unenforceable.  As explained below, plaintiff failed to
carry his burden.

The opposition first characterizes SSI’s arbitration provision as procedurally
unconscionable because it was not subject to any real negotiation but was instead
presented on a take-it-or-leave-it basis.  However, plaintiff provided no evidence
whatsoever and has thus provided the Court with no facts on which it could
affirmatively find either that the arbitration provision was categorically non-negotiable
or that SSI otherwise refused to negotiate the terms of arbitration.  Similarly, there is
no evidence now before the Court which establishes that plaintiff was not told he could
negotiate the terms.  Regardless, even if there is some degree procedural
unconscionability as a result of the arbitration provision being offered on a take-it-or-
leave-it basis, plaintiff must still show a significant amount of substantive
unconscionability in order to avoid the enforcement of the arbitration agreement.

The opposition next asserts that the arbitration clause is substantively unconscionable
because it does not require SSI to arbitrate any claims it may have against plaintiff but
this assertion is contradicted by the plain terms of the arbitration provision.  First,
nowhere does the provision expressly exclude from arbitration any claim which may be
brought by SSI (or an employee).  Second, the clause states in boldface, capitalized
print that “ALL DISPUTES INVOLVING ALLEGED UNLAWFUL EMPLOYMENT
DISCRIMINATION…SHALL BE RESOLVED PURSUANT TO THIS POLICY…”  Third,
the handbook also explicitly provides:  [SSI], its representatives, and the employee…
shall submit to arbitration…  THE PARTIES SHALL WAIVE ALL RIGHTS TO A
TRIAL…” (Emphasis added.)  The Court finds nothing in this plain language which
permits SSI to opt out of arbitration and thus, plaintiff has failed to demonstrate any
substantive unconscionability with respect to the scope of the arbitration clause.
While it is true that the arbitration clause does grant SSI the right to revise company
policy and other provisions found in the employee handbook including but not limited
to the arbitration clause, the Court does not find that this constitutes a significant, if
any, degree of substantive unconscionability since SSI’s right is necessarily limited by
the implied covenant of good faith and fair dealing.  This effectively precludes SSI from
unfairly interfering with its employee’s rights and/or benefits pursuant to the
handbook’s provisions.

Plaintiff’s final contention is that SSI’s failure to include with the employee handbook
the applicable arbitration rules, which effectively forced plaintiff to investigate the rules
on his own, also creates an element of unconscionability which weighs against
enforcement of the arbitration agreement.  However, this contention is again not
supported by any evidence now before the Court since there is no declaration by
plaintiff which avers that he was not provided the rules or even that he requested an
opportunity to review the rules before assenting to the terms of his employment,
including the arbitration clause.  In any event, California law does not hold that the
mere failure to provide the arbitration rules precludes as a matter of law enforcement
of an arbitration agreement.  In a recent decision, Samaniego v. Empire Today LLC
(2012) 205 Cal.App.4th 138, the employee-plaintiff cited the failure to provide the
arbitration rules as one ground on which to escape an arbitration clause.  The Court of
Appeal ultimately affirmed the trial court’s decision to deny the employer’s motion to
compel arbitration given a multitude of problems including an inconspicuous arbitration
clause, the lack of a Spanish translation, the failure to provide the arbitration rules and
multiple one-sided substantive provisions, all of which supported a finding of
unconscionability. (Samaniego, at 1143-1148.)  No similar showing is made in the
present case.

Based on the foregoing, plaintiff has failed to demonstrate any sufficient ground on
which this Court may refuse to enforce the arbitration clause found in SSI’s employee
handbook.  Accordingly, SSI’s motion to compel arbitration is granted and a stay is
hereby imposed on plaintiff’s prosecution of the present action in this Court.

This minute order is effective immediately.  Pursuant to CRC Rule 3.1312, counsel for
SSI to prepare formal order consistent with the foregoing.