Scott v. Loomis Armored US, LLC ( 2021 )

1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 EASTERN DISTRICT OF CALIFORNIA 11 12 DASHAY P. SCOTT, individually No. 2:21-cv-00896-JAM-AC and on behalf of all others 13 similarly situated, 14 Plaintiff, ORDER GRANTING LOOMIS’S MOTION TO COMPEL ARBITRATION AND TO 15 v. STAY PLAINTIFF’S PAGA CLAIM 16 LOOMIS ARMORED US, LLC, and DOES 1 through 100, 17 inclusive, 18 Defendants. 19 20 Dashay P. Scott (“Plaintiff”) brings the present wage and 21 hour class action against Loomis Armored US, LLC (“Defendant”). 22 See First Amended Complaint (“FAC”), ECF No. 14. Defendant moves 23 to compel arbitration of Plaintiff’s non-Private Attorneys 24 General Act (“PAGA”) claims and to stay her remaining PAGA claim 25 pending the outcome of the individual arbitration proceeding. 26 See Mot., ECF No. 19-1. Plaintiff filed an opposition. See 27 Opp’n, ECF No. 21. Defendant replied. See Reply, ECF No. 22. 28 1 For the reasons below, the Court GRANTS Defendant’s Motion.1 2 3 I. BACKGROUND 4 Defendant is a national transporter of currency. Mot. at 1; 5 Opp’n at 2. Defendant employed Plaintiff as a cash management 6 services teller (“CMS Teller”) at its Hayward, California 7 facility from September 2019 until February 2021. FAC ¶ 8; Opp’n 8 at 3. As a CMS Teller, Plaintiff’s primary role was money 9 processing; that is, counting, auditing, and organizing money 10 coming in and going out of the facility. Opp’n at 3-4. 11 During Plaintiff’s onboarding process, Defendant presented 12 her with a copy of the Loomis arbitration program (the “ADR 13 Plan”). Mot. at 2; see also Executed ADR Plan, Ex. A to Morgan 14 Decl., ECF No. 19-3. Plaintiff signed the ADR Plan on September 15 4, 2019. See Executed ADR Plan at 2. Under the terms of the ADR 16 Plan, Plaintiff must arbitrate “any dispute arising out of or 17 related to” her “employment or relationship with” Loomis, 18 including the “termination of [her] employment.” Id. at 1. She 19 must also bring any claims “on an individual basis only, and not 20 on a class or collective basis on behalf of others.” Id. at 2. 21 In February 2021, Defendant terminated Plaintiff’s 22 employment. Opp’n at 5. Plaintiff then filed this class action 23 in Sacramento County Superior Court alleging violations of 24 California’s Labor Code and Unfair Business Practices Act for 25 unpaid wages, noncompliant meal periods and rest breaks, 26 27 1 This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was 28 scheduled for November 16, 2021. 1 inaccurate wage statements, and waiting time penalties, along 2 with an individual claim for disability discrimination. See 3 Compl., Ex. A to Not. of Removal, ECF No. 1. Defendant removed 4 the case pursuant to the Class Action Fairness Act of 2005 5 (“CAFA”). See Not. of Removal ¶ 1. Following removal, Plaintiff 6 amended her complaint adding a PAGA claim. See FAC. 7 Defendant now seeks to compel Plaintiff’s compliance with 8 the ADR Plan, specifically waiver of her class claims and 9 individual arbitration of her non-PAGA claims. See generally 10 Mot. Defendant further requests that Plaintiff’s remaining PAGA 11 claim be stayed pending entry of a final award in the arbitration 12 proceeding. Id. 13 14 II. OPINION 15 A. Legal Standard 16 The Federal Arbitration Act (“FAA”) makes arbitration 17 agreements “valid, irrevocable, and enforceable, save upon such 18 grounds as exist at law or in equity for the revocation of any 19 contract” and confers the right to obtain an order 20 requiring arbitration proceed in the manner provided for in the 21 contract. AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 22 (2011) (quoting 9 U.S.C. § 2). Under the FAA, a court must 23 compel arbitration if (1) a valid agreement to arbitrate exists 24 and (2) the dispute falls within the scope of that agreement. 25 Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 26 (9th Cir. 2000). Thus, the FAA “eliminates district court 27 discretion and requires the court to compel arbitration of issues 28 covered by the arbitration agreement.” Dittenhafer v. Citigroup, 1 No. C 10-1779 PJH, 2010 WL 3063127, at *2 (N.D. Cal. Aug. 2, 2 2010) (internal citations omitted). The role of the federal 3 court in these circumstances is limited to determining whether 4 the arbitration clause at issue is valid and enforceable under 5 Section 2 of the FAA. Id. 6 The party seeking to avoid arbitration under the FAA bears 7 the burden of proving that the claims are unsuitable for 8 arbitration. Nationwide Agribusiness Insurance Co. v. Buhler 9 Barth GmbH, No. 1:15-cv-00582-JAM-EPG, 2015 WL 6689572, at *4 10 (E.D. Cal. Oct. 30, 2015); see also Daugherty v. Experian Info. 11 Solutions, Inc., 847 F.Supp.2d 1189, 1194 (N.D. Cal. 2012) (“The 12 party resisting arbitration bears the burden of showing the 13 arbitration agreement is invalid or does not encompass the claims 14 at issue.”). 15 B. Analysis 16 1. Non-PAGA Claims 17 In its motion, Loomis argues Plaintiff entered into a 18 binding and enforceable arbitration agreement, the ADR Plan, and 19 Plaintiff must therefore abide by her agreement to waive her 20 class claims and individually arbitrate all of her claims except 21 for the PAGA claim. Mot. at 4-14. Plaintiff resists Loomis’s 22 motion to compel on five grounds. See generally Opp’n. 23 First, Plaintiff invokes an exemption in the FAA for 24 transportation workers. Opp’n at 7-12. While the FAA “embodies” 25 a “liberal federal policy favoring arbitration agreements,” the 26 FAA does not apply to “whole industries of workers.” Rogers v. 27 Lyft, Inc., 452 F.Supp.3d 904, 913 (N.D. Cal. 2020) (internal 28 citations omitted). Specifically, Section 1 of the FAA provides 1 the following exemption: “nothing herein contained shall apply to 2 contracts of employment of seamen, railroad employees, or any 3 other class of workers engaged in foreign or interstate 4 commerce.” 9 U.S.C. § 1. Here Plaintiff clearly is not a seaman 5 or a railroad employee, but she claims membership in the residual 6 “class of workers engaged in foreign or interstate commerce.” 7 Opp’n at 7. But Plaintiff’s out-of-circuit, non-binding 8 authority, see Opp’n at 8-10 (citing to Palcko v. Airborne 9 Express, Inc., 372 F.3d 588 (3rd Cir. 2004); Bacashihua v. United 10 States Postal Serv., 859 F.2d 402 (6th Cir. 1988); Am. Postal 11 Workers Union v. United States Postal Serv., 823 F.2d 466 (11th 12 Cir. 1987); and Saxon v. Southwest Airlines Co., 993 F.3d 492 13 (7th Cir. 2021)), do not support her position that her role as a 14 CMS Teller processing money in Defendant’s Hayward location 15 qualifies her as a transportation worker. See Reply at 1-3 16 (distinguishing Plaintiff’s cited authority). Nor does the lone 17 Ninth Circuit case she cites to: Rittman v. Amazon.com, Inc., 18 971 F.3d 904 (9th Cir. 2020). Opp’n at 11. In Rittman, the 19 plaintiffs were drivers responsible for personally delivering 20 goods that Amazon ships across state lines. 971 F.3d at 917. On 21 these facts, the Ninth Circuit found that plaintiffs “form part 22 of the channels of interstate commerce and are thus engaged in 23 interstate commerce.” Id. Thus, the Ninth Circuit concluded the 24 FAA exemption for transportation workers applied. Id. at 919. 25 By contrast here, Plaintiff never drove a Loomis truck nor 26 physically loaded or unloaded them. See Opp’n at 3-4. Rather, 27 Plaintiff’s work was performed entirely on-site at Loomis’s 28 Hayward facility and primarily involved money processing. Opp’n 1 at 3-4. Plaintiff’s work thus did not require her to personally 2 transport anything, let alone anywhere outside of the facility in 3 which she worked. Id. Thus, the analogy to the plaintiff- 4 drivers in Rittman comes up short. 5 The final case Plaintiff cites to, Christie v. Loomis 6 Armored US, Inc., Civil Action No. 10-cv-02011-WJM-KMT, 2011 WL 7 6152979, at *3 (D. Colo. Dec. 9, 2011), is likewise 8 distinguishable. Opp’n at 11. In Christie, the court concluded 9 plaintiff was a transportation worker subject to the FAA 10 exemption because she was “actually employed as a driver for” 11 Loomis, personally responsible for “transport[ing] currency, a 12 good that is undisputedly in the stream of interstate commerce.” 13 2011 WL 6152979, at *3. Here again, Plaintiff is not a driver 14 for Loomis directly responsible for transporting currency. 15 For these reasons, Plaintiff does not meet her burden of 16 demonstrating the transportation worker exemption applies. See 17 Rogers, 452 F.Supp.3d at 913 (“As the parties resisting 18 arbitration, [plaintiffs] bear the burden of proving that the 19 [transportation worker] exemption applies”). At most, Plaintiff 20 has shown her work was “tangentially related to the movement of 21 goods,” which is insufficient to qualify her as a transportation 22 worker. Rittman, 971 F.3d at 911 (internal citations omitted). 23 Second, Plaintiff argues the ADR Plan is procedurally and 24 substantively unconscionable and thus unenforceable. Opp’n at 25 13-15. But this argument puts the cart before the horse. As 26 Defendant points out, the threshold issue is whether the parties 27 agreed to leave the question of arbitrability – including whether 28 the agreement is unconscionable - to the arbitrator. Mot. at 6; 1 Reply at 3. If they did, the issue of unconscionability is left 2 to the arbitrator, not this Court. Brennan v. Opus Bank, 796 3 F.3d 1125, 1133 (2015); see also Brice v. Haynes Invs., LLC, 13 4 F.4th 823, 827 (9th Cir. 2021) (“Where a delegation provision 5 exists, courts first must focus on the enforceability of that 6 specific provision, not the enforceability of the arbitration 7 agreement as a whole.”). 8 Here, the ADR Plan contains such a delegation provision. 9 Section 1 provides: “any legal dispute or controversy covered by 10 this Agreement, or arising out of, relating to, or concerning the 11 validity, enforceability or breach of this Agreement, shall be 12 resolved by final and binding arbitration in accordance with the 13 Employment Arbitration Rules of the American Arbitration 14 Association.” Executed ADR Plan § 1 (emphasis added). This 15 provision “clearly and unmistakably delegates threshold questions 16 of arbitrability to the arbitrator.” Rogers, 452 F.Supp.3d at 17 918. Significantly, in opposition Plaintiff failed to challenge 18 the delegation provision itself. See generally Opp’n. Because 19 Plaintiff failed to “make any arguments specific to the 20 delegation provision” and instead argues that the entire 21 agreement is unconscionable, the Court “need not consider 22 [Plaintiff’s unconscionability] claim[s]” because they are “for 23 the arbitrator to decide.” Brennan, 796 F.3d at 1133 (internal 24 citations omitted) (explaining “in order to have the federal 25 court address his unconscionability challenge, [plaintiff] would 26 have had to argue that the agreement to delegate to an arbitrator 27 his unconscionability claim was itself unconscionable”). 28 Accordingly, Plaintiff’s second argument as to unconscionability 1 fails. 2 Third, Plaintiff argues the class waiver is unenforceable 3 because it is part of a broader agreement that is unenforceable. 4 Opp’n at 1,6.2 But, as explained above, the enforceability of 5 the agreement is an issue for the arbitrator to decide. This 6 additional argument does not alter the above analysis. 7 Fourth, Plaintiff argues that compelling arbitration at this 8 stage is premature and she should instead be granted discovery. 9 Opp’n at 1-2, 6.3 The Court disagrees. As discussed above, 10 Plaintiff has not carried her burden to challenge the ADR Plan’s 11 delegation provision. In the absence of such a challenge, this 12 Court must enforce the unambiguous delegation provision and 13 compel arbitration. See Dittenhafer, 2010 WL 3063127, at *2 14 (explaining the FAA “eliminates district court discretion and 15 requires the court to compel arbitration”) (emphasis added). 16 Lastly, Plaintiff raises a policy argument that it would 17 serve judicial economy to litigate her non-PAGA claims in this 18 Court because the Court must keep her PAGA claim, which is non- 19 arbitrable. Opp’n at 2,7.4 However, as Defendant argues, 20 Plaintiff’s assertion of a PAGA claim has no bearing on whether 21 22 2 Plaintiff expounds on this argument on page 16 of the opposition brief, however, this part of the brief was not 23 considered by the Court as it violated Court’s page limits for opposition memoranda. See Order re Filing Requirements (“Order”) 24 at 1, ECF No. 3-2. 3 Once again, Plaintiff expounds on this argument in a part of 25 the opposition brief that ran over the Court’s page limit. See Opp’n at 16-17. The Court did not consider arguments made past 26 the page limit. See Order at 1. 27 4 Again, Plaintiff advances this argument in part of the brief that ran over the Court’s page limits and thus was not 28 considered. See Opp’n at 17. 1 her remaining non-PAGA claims should be referred to arbitration, 2 and her class claims dismissed. Mot. at 14-15; Reply at 4-5. 3 Courts in the Eastern District routinely deny motions to compel 4 PAGA claims while compelling arbitration of other claims. See 5 e.g. Anderson v. Safe Streets USA LLC, No. 18-cv-00323-KJM, 2018 6 WL 4106135, at *12 (E.D. Cal. Aug. 29, 2018) (“Multiple district 7 courts, including this court, have held that where PAGA claims 8 are derivative of substantive claims that must be arbitrated 9 . . . a court may stay any PAGA claims until arbitration is 10 completed.”); Musolf v. NRC Envtl. Servs., Inc., No. 20-cv-01387- 11 KJM-CKD, 2021 WL 1696282, at *3 (E.D. Cal. Apr. 29, 2021) 12 (granting motion to compel arbitration and staying the PAGA 13 claims pending completion of arbitration.). Plaintiff’s final 14 policy argument therefore fails. 15 In short, the Court finds the delegation provision of the 16 ADR Plan to be enforceable. Defendant’s motion to compel 17 arbitration is thus GRANTED and Plaintiff is ordered to 18 individually arbitrate her non-PAGA claims against Loomis. 19 2. PAGA Claims 20 Having concluded that Plaintiff’s non-PAGA claims must be 21 arbitrated in accordance with the delegation provision of the ADR 22 Plan, this Court stays Plaintiff’s PAGA claim, which both parties 23 agree is non-arbitrable. See Mot. at 14-15; Opp’n at 5. This 24 proceeding shall be stayed pending the outcome of the 25 arbitration. The parties are ordered to file a joint status 26 report within ten (10) days of completing arbitration. 27 /// 28 /// eee I III RII EI IEE OEE I EEE eee 1 Til. SANCTIONS 2 Plaintiff exceeded the Court’s 15-page limit on opposition 3 memoranda. See Opp’n; see also Order at 1. Violations of the 4 Court’s standing order require the offending counsel, not the 5 client, to pay $50.00 per page over the page limit to the Clerk 6 of Court. Order at 1. Moreover, the Court did not consider 7 arguments made past the page limit. Id. Plaintiff’s opposition 8 brief exceeded the Court’s page limit by 2.5 pages. See Opp’n. 9 | Accordingly, Plaintiff’s counsel must send a check payable to the 10 Clerk for the Eastern District of California for $125.00 no later 11 than seven (7) days from the date of this order. 12 13 Iv. ORDER 14 For the reasons set forth above, this Court GRANTS 15 Defendant’s motion to compel arbitration, and hereby STAYS 16 | Plaintiff’s PAGA claim pending the outcome of the arbitration. 17 IT IS SO ORDERED. 18 Dated: December 28, 2021 19 ke Me 20 teiren staves odermacr 7008 21 22 23 24 25 26 27 28 10