Private Attorneys General Act Review – 2023 - Report - Page 25
the Private Attorneys General Act (PAGA). The defendant moved to compel arbitration
of the plaintiff’s claims pursuant to an agreement she signed agreeing to submit all
employment-related disputes to arbitration. The agreement also contained a class
action waiver, which provided that the parties "agree to waive all rights to bring, or be a
party to, any class or collective claims against one another and agree to pursue claims
on an individual basis only." Id. at *5. The defendant asserted that the plaintiff’s claims
were covered in scope by the enforceable agreement, and therefore the district court
should compel arbitration of the claims on an individual basis and dismiss all class and
representative claims. The defendant further contended that the class action waiver was
enforceable and that under the United States Supreme Court's recent decision in Viking
River, Inc. v. Moriana, 142 S.Ct. 1906 (2022), Plaintiff's individual PAGA claims must be
arbitrated while her representative claims must be dismissed. Id. at *9. The plaintiff first
argued that the agreement was void and therefore unenforceable because it was
unconscionable. The district court rejected the argument, finding that the agreement
was not substantively unconscionable. Next, the district court found that since Viking
River, at least one California court has found that the Supreme Court's standing
analysis was dicta but declined to reach whether its reading of California law was
correct, two judges have compelled arbitration of individual PAGA claims while staying
the non-representative claims, and several in other districts in California have compelled
arbitration of individual PAGA claims and dismissed the representative PAGA claims,
finding Viking River to be binding on the question of PAGA standing. Id. at *22. The
district court found that a stay of the non-individual claim would be appropriate because
the Supreme Court in Viking River also found that the issue of statutory standing under
PAGA is subject to clarification under state law. Id. at *24. The district court noted that
since the California Supreme Court has taken up the issue of statutory standing in the
pending case Adolph, et al. v. Uber Technologies, Inc., 2022 Cal. App. Unpub. LEXIS
2170 (Cal. Ct. App., Apr. 11, 2022), a stay of the representative PAGA claims pending
further legal developments was warranted. Accordingly, the district court granted the
defendant’s motion in part and compelled arbitration of all of Plaintiff's claims except her
non-individual PAGA claim. The district court stayed the representative PAGA claim
pending the resolution of Adolph by the California Supreme Court. Id. at *24-25.
In Hernandez, et al. v. Delta Star Inc., 2023 U.S. Dist. LEXIS 17745 (N.D. Cal. Feb. 2,
2023), the plaintiff filed a state court class action under the Private Attorneys General
Act of 2004 (PAGA) under California law. The defendant removed the action to the
District Court alleging that the state-law cause of action was truly a federal cause of
action because of complete preemption. The defendant asserted that complete
preemption existed because adjudication of the dispute would involve interpreting a
collective bargaining agreement between the defendant and parties the plaintiff sought
to represent. The plaintiff filed a motion to remand, alleging that the dispute would not
require interpretation of the collective bargaining agreement and therefore there was not
complete preemption. The district court granted the plaintiff’s motion to remand. The
district court determined that although the plaintiff sought to represent other employees
subject to a collective bargaining agreement, the defendant failed to produce evidence
that there was any active dispute over the meaning of the contract terms and therefore
there was no need to interpret the agreement. The district court also ruled the claims did
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© Duane Morris LLP 2023
PAGA Litigation Review – 2023
