OHANIAN v. LYFT, INC., et al.

State Law

The California Code of Civil Procedure sections 1280 et seq. provide a procedure for the summary determination of whether a valid agreement to arbitrate exists, and such summary procedure satisfies both state and federal law. (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th394, 413.)

The Court must determine when a petition to compel arbitration is filed and accompanied by prima facie evidence of a written arbitration agreement whether the agreement exists, if any defense to its enforcement is raised, and whether the agreement is enforceable. (Rosenthal, supra, 14 Cal.4th at p. 413.) The petitioner bears the burden of proving the existence of the arbitration agreement by preponderance of the evidence. (Id.) If the party opposing the petition raises a defense to enforcement, then he bears the burden of producing evidence and proving by preponderance of the evidence any fact necessary to the defense. (Id.) The trial court’s role is to resolve these factual issues. (Id. at p. 414.)

Federal Law—FAA

The Federal Arbitration Act (FAA), at 9 U.S.C. §1, et seq., also authorizes enforcement of arbitration clauses unless grounds exist in law or equity for the revocation of any contract. (9 U.S.C. § 2). The enforcement language of the FAA is almost identical to Code of Civil Procedure section 1281. In situations governed by the FAA, conflicting state law is preempted in either state or federal courts. (Volt Info. Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University (1989) 489 U.S. 468, 477 [“The FAA contains no express pre-emptive provision, nor does it reflect a congressional intent to occupy the entire field of arbitration . . . . But even when Congress has not completely displaced state regulation in an area, state law may nonetheless be pre-empted to the extent that it actually conflicts with federal law . . . .”].)

To compel arbitration under the FAA, the Court must find an agreement exists for arbitration between the parties and the agreement covers the dispute. (AT&T Technologies, Inc. v. Communications Workers of America (1986) 475 U.S. 643, 648-649.)

The enforcement of an arbitration clause is a matter of ordinary state-law contract principles. (AT&T Mobility LLC v. Concepcion (2011) 131 S.Ct. 1740, 1745 (Concepcion); First Options v. Kaplan (1995) 514 U.S. 938, 944.) Arbitration agreements are on equal footing with other contracts and should be enforced according to their terms. (Concepcion, supra, 131 S.Ct. at p. 1745.) The section in the FAA, 9 U.S.C. §2, providing arbitration agreements can be declared unenforceable on grounds of law or equity for revocation permits invalidating such agreement on contract defenses of fraud, duress, or unconscionability. (Id. at p. 1746.)

State rules of procedure, including those governing petitions to compel arbitration, apply in state court proceedings except where such rules would defeat the purpose of the federal law. (Rosenthal, supra, 14 Cal.4th at p. 409-410.)

Here, the subject agreement states, in pertinent part, as follows:

This agreement to arbitrate ("Arbitration Agreement") is governed by the Federal Arbitration Act ("FAA''); but if the FAA is inapplicable for any reason, then this Arbitration Agreement is governed by the laws of the State of Delaware, including Del. Code tit. 10, § 5701 et seq., without regard to choice of law principles.

Defendant argues the FAA applies as the subject agreement expressly states so. Plaintiff does not address the issue of the applicable law directly, but does not dispute that the FAA applies to the instant action in his Opposition.

As the subject agreement provides for the FAA to govern, then it governs. (Cronus Investments, Inc. v. Concierge Services (2005) 35 Cal.4th 376, 394; Aviation Data, Inc. v. American Express Travel Related Services Co., Inc. (2007) 152 Cal.App.4th 1522, 1534-35.)

Contractual Relationship Between Plaintiff and Lyft

In its Motion, Defendant contends Plaintiff entered into the subject arbitration agreement with the Defendant. As set forth in the declaration of Sniegowski, Plaintiff created a Lyft user account with her phone number and email address on December 13, 2021, with the user name “Ani O.” Sniegowski indicates Plaintiff accepted Lyft’s Terms of Service (the Agreement) within the Lyft App on three separate occasions, both before and after the subject accident and used the Lyft Platform to request, purchase, and/or utilize Rideshare Services on 385 different occasions, including the February 5, 2024 ride that is the subject of this lawsuit.

In her Opposition, Plaintiff appears to argue she did not enter into the Agreement with the Defendant because the Agreement is procedurally unconscionable. Specifically, that users of Lyft’s App are forced to review the length terms of the Agreement on a cell phone screen, which makes it unlikely that they would seek the help of an attorney in reviewing the terms before accepting them. Plaintiff also argues that she never “personally ordered a ride using the Lyft Platform, nor does she recall personally opening an account with the Lyft Platform and/or agreeing to any terms or conditions thereof.” Plaintiff further contends she suffers from an eye condition, which prevents her from driving and Defendant fails to show it provided Plaintiff its terms and conditions in an accessible format.

Defendant replies, arguing Plaintiff's claim that she does not “recall personally opening an account with Lyft or agreeing to any terms or conditions thereof” is irrelevant and cites to Pinnacle Museum Tower Assn. v. Pinnacle Mkt. Dev. (US), LLC (2012) 55 Cal.4th 223, 236 for authority that a contract may be binding on a party even if the party never actually read the clause. Defendant further cites to Sellers v. JustAnswer LLC (2021) 73 Cal.App.5th 444, 470 for authority that California courts routinely enforce scrollwrap agreements, recognizing that presenting the full contract directly to the user and requiring affirmative assent establishes mutual assent.

The court finds that the Defendant met its initial burden to establish the existence of an agreement to arbitrate between Lyft and the Plaintiff by attaching a copy of the Agreement with the subject arbitration provision to the instant Motion’s Compendium of Exhibits, which was “signed” by the Plaintiff using the process set forth by Sniegowski. (Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047.) Specifically, Sniegowski declares Plaintiff created a Lyft user account on December 13, 2021 with the user name: “Ani O.” by providing her phone number and email address and was assigned the User ID: 1619786306359109876.

Sniegowski further states as evidenced in Defendant’s Exhibit 1, that Plaintiff accepted Lyft’s Terms of Service dated December 9, 2020 during the account creation process. Plaintiff fails to submit any evidence to support her contention that she did not sign the Agreement. Instead, Plaintiff relies on a declaration from her counsel, who argues Defendant has failed to produce an arbitration agreement naming the Plaintiff and Lyft as parties. As a party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense, Plaintiff fails to meet this burden.

There is no declaration filed with Plaintiff’s Opposition from the Plaintiff that would place the burden back on Lyft to prove, by a preponderance of the evidence, that the

electronic signature was authentic. (Ruiz v. Moss Bros. Auto Group, Inc. (2014) 232 Cal.App.4th 836, 846.)

Delegation Clause

Generally, the court determines the enforceability of an arbitration agreement. (Ajamian v. CantrorCO2e, L.P. (2012) 203 Cal.App.4th 771, 781) (Ajamian). Nonetheless, who decides an issue is a matter of party agreement. (Sandquist v. Lebo Automotive, Inc. (2016) 1 Cal.5th 233, 243, overruled on other grounds per Lamps Plus, Inc. v. Valera (2019) 139 S.Ct. 1407, 1413, 1418-19 (Sandquist); Ajamian, supra, 203 Cal.App.4th at p. 781.) As the U.S. Supreme Court states, “Just as the arbitrability of the merits of a dispute depends upon whether the parties agreed to arbitrate that dispute, ..., so the question ‘who has the primary power to decide arbitrability’ turns upon what the parties agreed about that matter.” (First Options of Chicago, Inc. v.

Kaplan (1995) 514 U.S. 938, 943 (First Options); Rent-A-Center, W., Inc. v. Jackson (2010) 561 U.S. 63, 68-69 (Rent-A-Center).) Thus, the starting point on determining who decides is the parties’ agreement. (Sandquist, supra, 1 Cal.5th at p. 243.)

“There are two prerequisites for a delegation clause to be effective. First, the language of the clause must be clear and unmistakable. (Rent-A-Center, supra, 561 U.S. at p. 69, fn. 1.) Second, the delegation must not be revocable under state contract defenses such as fraud, duress, or unconscionability. (Id. at p. 68; Tiri v. Lucky Chances, Inc. (2014) 226 Cal.App.4th at p. 242, citing Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63)

“Parties to an arbitration agreement may agree to delegate to the arbitrator, instead of a court, questions regarding the enforceability of the agreement. [Citation.] They “can agree to arbitrate almost any dispute—even a dispute over whether the underlying dispute is subject to arbitration.” [Citation.]” (Tiri v. Lucky Chances, Inc., supra, 226 Cal.App.4th at 241.)

Defendant argues in its Motion that the Agreement contains a delegation clause that clearly and unmistakably delegated to the arbitrator the resolution of all arbitrability questions. Citing Rent-A- Center, West, Inc. v. Jackson (2010) 561 U.S. 63, 66, 69, fn. 1 (Rent-A-Center), Defendant contends the delegation clause here consists of language that clearly and unmistakably delegated all arbitrability issues, including questions about the Agreement’s “scope” and “applicability,” to the arbitrator.

Plaintiff does not address Defendant’s argument pertaining to the Agreement’s delegation clause in her Opposition, but argues the Agreement does not apply to Plaintiff’s claims because the claims are against “Lyft's drivers” to which Lyft is merely vicariously liable under California Public Utilities Code section 5354.

Defendant replies, pointing out Plaintiff fails to address Defendant’s arguments in her Opposition and renewing its contention that the Agreement’s delegation clause is clear and unmistakable. Further, Defendant cites to Peterson v. Lyft, Inc. (N.D. Cal. 2018) 2018 WL 6047085, at *3 to support its contention that courts have specifically found the language in the Agreement to constitute a valid, clear, and unmistakable delegation.

The court finds the Agreement contains an enforceable delegation clause and will grant Defendant’s request to compel Plaintiff’s claim against Lyft to arbitration. Evidence that the parties intended such a delegation must be “clear and unmistakable” before a court will enforce a delegation provision. (Mondragon v. Sunrun (2024) 101 Cal.App.5th 592, 603.) The “clear and unmistakable” test reflects a heightened standard of proof that reverses the typical presumption in favor of the arbitration of disputes. (Ibid. Internal citations omitted). Here, the Agreement states, in pertinent part, as follows: “All disputes concerning the arbitrability of a Claim (including disputes about the scope, applicability, enforceability,

revocability or validity of the Arbitration Agreement) shall be decided by the arbitrator, except as expressly provided below.” (emphasis added) The subject delegation clause is effective as the language of the clause is clear and unmistakable and Plaintiff fails to raise any defenses as to its revocability. (Rent- A-Center, supra, 561 U.S. at p. 68, 69, fn. 1.) In this instance, the issue of the enforceability of the Agreement is solely within the purview of the arbitrator.

TENTATIVE RULING

Defendant’s Motion to Compel Arbitration is granted and the action is stayed pending the outcome of the arbitration.