Vazquez vs. GNIMGT, Inc.

(Gures Decl. ¶ 3.)

OCDA has not filed an opposition to Plaintiffs’ motion. Therefore, it has failed to justify the objection raised in its March 26 letter. (Notably, the sole objection raised was to the duplicative nature of the subpoena. OCDA did not raise objections such as the attorney-client privilege, work product doctrine, etc. Any objections not raised in the letter are waived.) Plaintiffs’ motion is accordingly granted.

As to the nature of the production, Plaintiffs will accept “redactions of nonparty minor identifying information, including names, dates of birth, contact information, and medical or mental health information, so long as the factual substance of the allegations, investigative findings, witness statements, dates, locations, and Bruce’s conduct remained intact.” (Mot. at p. 11.) By no later than August 24, 2026, OCDA is to produce all documents responsive to the subpoena, redacted as proposed by Plaintiffs.

10 Vazquez vs. Plaintiff's Motion to Compel Arbitration GNIMGT, Inc. Defendant GNIMGT, Inc. moves to compel arbitration of the 2025-01535748 individual portion of Plaintiff Erick Vasquez’s PAGA claim and stay the representative portion pending completion of arbitration. The motion is DENIED.

GROUNDS FOR RULING

I.

Introduction

Plaintiff does not dispute that he signed the arbitration agreement at issue during the onboarding process, nor that it covers all claims at issue here. (See generally Vasquez Decl.) Following the Court’s prior minute order, Defendant submitted a declaration establishing that Artemis Hospitality, defined as “the Company” in the agreement, is a fictitious business name used by Defendant. (See 3rd Gutierrez Decl.) The Court therefore finds that Defendant has proven an agreement to arbitrate exists, that Ex. A to the declaration of Matthew Alfonso Martinez is the agreement, that it is governed by the FAA, and that it covers all claims in this case.

II. Unconscionability

Plaintiff’s sole argument against enforcing the arbitration agreement is unconscionability.

“‘The prevailing view is that [procedural and substantive unconscionability] must both be present in order for a court to exercise its discretion to refuse to enforce a contract or clause under the doctrine of unconscionability.’ [Citation.] But they need not be present in the same degree. ‘Essentially a sliding scale is invoked which disregards the regularity of the procedural process of the contract formation, that creates the terms, in proportion to the greater harshness or unreasonableness of the substantive terms themselves.’” (Armendariz v. Foundation Health Psychcare

Services, Inc. (2000) 24 Cal.4th 83, 114.)

A. Procedural Unconscionability

“A procedural unconscionability analysis ‘begins with an inquiry into whether the contract is one of adhesion.’ [Citation.] An adhesive contract is standardized, generally on a preprinted form, and offered by the party with superior bargaining power ‘on a take-it-or-leave-it basis.’ [Citations.] Arbitration contracts imposed as a condition of employment are typically adhesive . . . .” (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 126.) “[A]lthough adhesion alone generally indicates only a low degree of procedural unconscionability, the potential for overreaching in the employment context warrants close scrutiny of the contract’s terms.” (Ramirez v. Charter Communications, Inc. (2024) 16 Cal.5th 478, 494.)

The arbitration agreement in the present case is adhesive. It was offered on Defendant’s pre-printed form. There is no serious dispute that Plaintiff had no opportunity to negotiate the agreement’s terms.

Because the agreement is adhesive, “[t]he pertinent question...is whether circumstances of the contract’s formation created such oppression or surprise that closer scrutiny of its overall fairness is required.” (OTO, supra, 8 Cal.5th at p. 126.) “‘The circumstances relevant to establishing oppression include, but are not limited to (1) the amount of time the party is given to consider the proposed contract; (2) the amount and type of pressure exerted on the party to sign the proposed contract; (3) the length of the proposed contract and the length and complexity of the challenged provision; (4) the education and experience of the party; and (5) whether the party’s review of the proposed contract was aided by an attorney.’” (Id.)

Plaintiff testifies he was informed that he needed to complete the onboarding documents immediately to secure his employment. (Vasquez Decl. ¶ 3.) However, as Plaintiff admits, while he was sent the onboarding documents in October 2024, his position didn’t actually open until April 2025. Indeed, the agreement itself reflects that while Plaintiff signed it in October 2024, it wasn’t countersigned by Defendant until April 2025. This suggests that Plaintiff was merely required to sign the agreement before his position started several months later, not immediately upon receiving a link to the onboarding website.

Plaintiff argues surprise is present because he was required to complete onboarding on his cell phone, which cut off terms of the agreement due to its small screen size compared to a computer. (Vasquez Decl. ¶ 4.) But Plaintiff never says he brought his lack of a computer to Defendant’s attention. Defendant isn’t responsible for Plaintiff’s lack of a personal computer.

Plaintiff also argues the circumstances were oppressive because he wasn’t given copies of the agreement in advance and thus couldn’t ask an attorney to review the agreement before he signed it. (Ibid.) However, Plaintiff testifies he completed the

agreement (and other onboarding documents) on his cell phone, which is portable. Nothing prevented Plaintiff from taking his cell phone to an attorney’s office and having an attorney review the agreement.

In sum, the Court finds procedural unconscionability exists, in that the agreement was adhesive and he was required to complete it before beginning work. However, there is no more procedural unconscionability than in the usual employment setting.

B. Substantive Unconscionability

1. Waiver of Administrative Relief

The Agreement provides: “The Employee may file a claim with an administrative agency, including the Equal Employment Opportunity Commission, the U.S. Department of Labor, the National Labor Relations Board, or the Office of Federal Contract Compliance Programs, if applicable law permits access to such an agency notwithstanding the existence of an arbitration agreement. The Employee agrees, however, to waive and release any right to receive any individual remedy or to recover any individual monetary or nonmonetary damages because of any administrative charge, complaint or lawsuit filed by anyone on the Employee's behalf.” (Agreement at pp. 1-2.) Plaintiff contends this is an unconscionable wavier of the right to obtain relief in the administrative process. The Court agrees.

In Hasty v. American Automobile Assn. (2023) 98 Cal.App.5th 1041, the appellate court considered a clause that provided “either party may file a charge or complaint with an appropriate governmental administrative agency, however, ‘the parties waive their right to any remedy or relief as a result of such charges or complaints brought by such governmental administrative agencies.’” (Id., at p. 1060.) The court noted that the Labor Commissioner may investigate employee complaints and, following investigation, award the employee wages owed.

The waiver of any relief from such a proceeding would “insulate[] the Association from such awards and precludes the employee from obtaining redress for labor violations that a government agency has determined exist and are well-founded.” (Ibid.) The court concluded, “A waiver of administrative remedies and relief, hidden in an arbitration agreement, is overly harsh and shocks the conscience.” (Ibid.)

The same is true here. Suppose another employee of Defendant were to complain to the EEOC about racial discrimination and suppose the EEOC decided to file suit alleging that Defendant discriminated against employees of Plaintiff’s race. Should the EEOC recover anything for the employees discriminated against in that action, Plaintiff would be barred from sharing in that relief. This is unconscionable.

2. Wholesale PAGA Waiver

The agreement allows the arbitrator to decide the individual

component of a PAGA claim (Agreement at p. 3), but it otherwise provides that “YOU...WAIVE ANY RIGHT...TO BRING ANY...REPRESENTATIVE ACTION.” (Agreement at p. 4.) The Agreement thus purports to wholly waive Plaintiff’s right to pursue the non-individual component of a PAGA claim. Furthermore, the representative action waiver is wholesale as written, suggesting Plaintiff cannot bring an individual PAGA claim, regardless of whether the arbitrator has the power to decide such a claim. In any event, the Agreement clearly purports to waive non-individual PAGA claims. Such a waiver is unconscionable under California law, even after Viking River. How to address this unconscionable waiver (e.g., by staying the nonindividual PAGA claim pending arbitration of the individual PAGA claim) is a separate question from whether the waiver is substantively unconscionable.

3. Waiver of Public Injunctive Relief

The arbitrator lacks the power “to award any class, collective, or other representative relief on behalf of any person other than you.” (Agreement at p. 3.) Citing Vaughn v. Tesla, Inc. (2023) 87 Cal.App.5th 208, Plaintiff argues this unconscionably waives his ability to seek public injunctive relief. The Court agrees.

“[A]n arbitration agreement that precludes a plaintiff from pursuing public injunctive relief in any forum is invalid and unenforceable as a matter of state law.” (Id., at p. 228.) This rule is not preempted by the FAA. (Id., at pp. 232-237.) In Vaughn, as here, the agreement “provide[d] for resolution of all covered disputes in arbitration, but prohibit[ed] an arbitrator from granting nonindividual relief.” (Id., at p. 228.) As a result, the agreement “waive[d] Plaintiffs’ right to seek a public injunction ‘in any forum.’” (Ibid.) The same is true here: the agreement unconscionably waives the right to public injunctive relief.

In reply, Defendant points out that Plaintiff doesn’t seek public injunctive relief in this case, and in any event, an injunction requiring an employer to obey the Labor Code with respect to its employees is private in nature. These points are both correct, but are irrelevant to an unconscionability analysis. Unconscionability is determined at the time a contract is made. (Civ. Code § 1670.5(a).)

4. Non-Mutuality of Confidentiality Agreement

As part of the onboarding process, Plaintiff signed a confidentiality agreement at the same time as the arbitration agreement. He contends the two agreements must be read together, and the confidentiality agreement has the effect of making the arbitration agreement unconscionably non-mutual.

Defendant argues the FAA prevents consideration of the two agreements together. When the FAA applies, “issues that go to the validity of an underlying contract, as opposed to the validity of an arbitration agreement itself, are normally decided by an arbitrator, not the court.” (Alberto v. Cambrian Homecare (2023) 91 Cal.App.5th 482, 494, fn. 4.) In Alberto, the court decided the

unconscionability of the underlying contract despite this general rule because the parties so stipulated. (Ibid.) As Defendant points out, there is no such stipulation here. But Defendant ignores the conclusion of the footnote in Alberto: “[W]e do not consider how this aspect of the FAA might matter to this case, except to note that, as we discuss above, the restriction on discussing wages [in the underlying contract] is not merely a generally illegal provision, but an illegal provision that directly affects the one-sidedness of the arbitration process.” (Ibid. (emphasis added).) That is, to the extent a separate agreement directly affects the arbitration process, it may be considered despite the FAA’s general rule.

Here, the arbitration agreement purports to require the parties to arbitrate all claims they may have against one another. The confidentiality agreement, however, provides that “Any action or proceeding by either Party to enforce this Agreement shall be brought only in any state or federal court located in the state of California, county of Los Angeles.” (Vasquez Decl., Ex. 1, § 12.)

“Lack of mutuality exists when an arbitration agreement directs a wide range of claims that would typically be brought by an employee into arbitration, but specifically excludes from arbitration claims that would typically be brought by an employer, including claims related to intellectual property rights and those for equitable relief related to unfair competition or the disclosure of trade secrets or confidential information.” (Gurganus v. IGS Solutions LLC (2025) 115 Cal.App.5th 327, 336.) In Gurganus, it was unconscionably non-mutual to subject the employee’s most likely claims to arbitration while simultaneously, via a separate confidentiality agreement, sending the employer’s intellectual property claims to court. (See id. at p. 337.)

And similar to Gurganus, the lack of mutuality here is heightened by the standard for provisional remedies under the confidentiality agreement. For claims subject to arbitration, the parties may seek provisional relief from a court under CCP § 1281.8. (Agreement at p. 1.) But for claims arising from the confidentiality agreement, Defendant may seek provisional relief from a court “without the necessity of showing any actual damages or that monetary damages would not afford an adequate remedy, and without the necessity of posting any bond or other security.” (Vasquez Decl., Ex. 1, at § 8.)

This is unconscionably non-mutual because Plaintiff must satisfy the traditional factors for provisional relief on claims he is most likely to bring, but Defendant may obtain such relief without proving all necessary factors. (Gurganus, supra, 115 Cal.App.5th at p. 338; see also Cluck v. GEO Secure Services, LLC (Aug. 3, 2026) 2026 WL 2224706).)

5. Remaining Arguments About Confidentiality Agreement

Plaintiff’s remaining arguments about the confidentiality agreement are about the unconscionability of the confidentiality agreement itself, not how the confidentiality agreement makes the arbitration agreement unconscionable. As a result, these arguments are not properly before the Court. (See Alberto, supra,

91 Cal.App.5th at p. 494, fn. 4.)

III. Severance

The arbitration agreement contains a severability clause. Defendant urges the Court to simply sever any unconscionable terms. The Court declines to do so. While a severability analysis is not a mere counting exercise, there are enough unconscionable provisions of the arbitration agreement (when read together with the confidentiality agreement) to conclude that the arbitration agreement is permeated with unconscionability. Severing the offending terms and enforcing the arbitration agreement would “create an incentive for an employer to draft a one-sided arbitration agreement in the hope employees would not challenge the unlawful provisions, but if they do, the court would simply modify the agreement to include the bilateral terms the employer should have included in the first place.” (Ramirez v. Charter Communications, Inc. (2025) 108 Cal.App.5th 1297, 1303- 1304.)

Rather than sever the offending terms, the Court declines to enforce the arbitration agreement.