Olga Reyes v. Filmtools, Inc.

(Stanley Mosk Courthouse: Dept. 511) September 9, 2026 DEPARTMENT 511 LAW AND MOTION RULINGS

Judge Upinder S. Kalra, Department 511 HEARING DATE: September 9, 2026 CASE NAME: Olga Reyes v. Filmtools, Inc. CASE NO.: 25STCV22369 MOTION TO COMPEL ARBITRATION MOVING PARTY: Defendant Filmtools Inc. RESPONDING PARTY(S): Plaintiff Olga Reyes REQUESTED RELIEF: 1. An order compelling Plaintiff's case to arbitration and issuing a stay pending arbitration. TENTATIVE RULING: 1. Motion to compel arbitration is DENIED. STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS: On July 29, 2025, Plaintiff Olga Reyes (Plaintiff) filed a complaint against Defendant Filmtools Inc. (Defendant) with eight causes of action for: (1) retaliation for disclosing unlawful conduct (Lab.

Code Sec. 1102.5); (2) discrimination (Lab. Code Sec. 6310); (3) failure to pay overtime compensation; (4) failure to provide accurate wage and hour statements; (5) waiting time penalties for failure to pay earned wages upon separation; (6) unfair competition; (7) failure to produce personnel file and employment records; and (8) wrongful termination in violation of public policy. According to the complaint, Plaintiff worked for Defendant as manufacturing and production manager since August 2019.

She alleges that Defendant retaliated against, and ultimately terminated, for reporting unsafe working conditions and noncompliant salary computations. She further alleges other Labor Code violations. On September 30, 2025, Defendant filed an answer. On March 20, 2026, Defendant filed the instant motion to compel arbitration. On June 12, 2026, Plaintiff filed an opposition. On June 22, 2026, Defendant filed notice of continuance of the hearing. Replies were due on or before September 1, 2026. As of September 4, 2026, the court has not received any reply.

LEGAL STANDARD: The Federal Arbitration Act ("FAA"), while a federal statute, applies in California courts and requires state courts to enforce

arbitration agreements as required by the federal common law developed under the FAA. (See¿ Southland Corp. v. Keating ¿(1984) 465 U.S. 1, 15-16;¿ Broughton v. Cigna¿Healthplans ¿(1999) 21 Cal.4th 1066, 1074-78, superseded by statute on another ground as¿stated¿in¿ Ferguson v. Corinthian Colleges, Inc. ¿(9th Cir. 2013) 733 F.3d 928, 937.).) The FAA preempts and invalidates state law and state judicial decisions that disfavor arbitration or require arbitration provisions to pass higher scrutiny. (Southland Corp.,¿ supra, at p. 12;¿ Perry v.

Thomas ¿(1987) 482 U.S. 483, 490.) If the parties¿designate¿the FAA applies, then California arbitration law is preempted. (See, e.g.,¿ Rodriguez v. American Techs., Inc. ¿(2006) 136 Cal.App.4th 1110, 1121-1122.)¿However, courts have found that where the FAA is found not to apply, the California Arbitration Act (Code Civ. Proc. Sec. 1280 et seq.) applies. (See¿ Valencia v. Smyth ¿(2010) 185 Cal.App.4th 153, 178 (Valencia).)¿¿¿¿¿ ¿¿¿¿ ¿A court's inquiry is limited to a determination of (1) whether a valid arbitration agreement exists and (2) whether the arbitration agreement covers the dispute. (9 U.S.C.

Sec. 4;¿ Chiron Corp. v. Ortho Diagnostics Systems, Inc. ¿(9th Cir. 2000) 207 F.3d 1126, 1130;¿ Howsam v. Dean Witter Reynolds, Inc. ¿(2002) 537 U.S. 79, 84; see¿ Simula, Inc. v. Autoliv, Inc. ¿(9th Cir. 1999) 175 F.3d 716, 720 [if the finding is affirmative on both counts the FAA requires the Court to enforce the¿arbitration agreement in accordance with its terms]; see¿ Omar v. Ralphs Grocery Co. ¿(2004) 118 Cal.App.4th 955, 961 [In determining the enforceability of an arbitration agreement, the court first considers "two 'gateway issues' of arbitrability: (1) whether there was an agreement to arbitrate between the parties, and (2) whether the agreement covered the dispute at issue"]¿ Lacayo v.

Cataline Restaurant Group Inc. ¿(2019) 38 Cal.App.5th 244, 257 (Lacayo) [Where moving party meets initial burden, "the party opposing arbitration must prove by a preponderance of the evidence any defense to the petition"].)¿¿¿¿¿ ¿¿ The general rule is that the FAA governs all agreements to arbitrate in contracts "involving interstate commerce." (Higgins v. Superior Court ¿(2006) 140 Cal.App.4th 1238, 1247.) The term "involving" commerce "is broad and is indeed the functional equivalent of "affecting' commerce." (Allied-Bruce Terminix Companies, Inc. v.

Dobson ¿(1995) 513 U.S. 265, 273-274.) The U.S. Supreme Court has held that this broad interpretation includes employment contracts. (See¿ Circuit City Stores v. Adams ¿(2001) 532 U.S. 105, 106.) The defendant bears the burden of proving applicability of the FAA by showing that its activities¿constitute¿interstate commerce. (Hoover v. Am. Income Life Ins. Co. ¿(2012) 206 Cal.App.4th 1193, 1207.) Failure to¿demonstrate¿that the employment agreement affects interstate commerce¿renders¿the FAA inapplicable. (See¿ Lane v.

Francis Capital Management LLC ¿(2014) 224 Cal.App.4th 676, 687-688 (Lane);¿ Woolls v. Superior Court ¿(2005) 127 Cal.App.4th 197, 212.)¿¿¿ ¿¿

Even where the FAA governs the interpretation of arbitration clauses, California law governs whether an arbitration agreement has been formed in the first instance. (Baker v. Osborne Development Corp. ¿(2008) 159 Cal.App.4th 884, 893.)¿¿ As a threshold matter, the parties do not dispute that the FAA applies to this matter. It also applies because Defendant provided evidence that its business (and Plaintiff's employment) involves commerce. Specifically, Defendant provided evidence that they market and sell their products nationally and internationally via website and their store as well as utilizing supplies from sources throughout the country. (Declaration of Jennifer Liwag (Liwag Decl.)

P. 4.) This falls within the broad purview of commerce. Thus, the FAA applies. ANALYSIS: Defendant contends the court should compel arbitration of this matter based on an arbitration agreement contained in an employee manual with Plaintiff's signed acknowledgement, there is no unconscionability preventing enforcement, and they did not waive the ability to compel arbitration. Plaintiff argues there is no arbitration agreement because there is no mutual assent to arbitrate. [1] Existence of Arbitration Agreement ¿ ¿"The party¿seeking¿to compel arbitration bears the burden of proving the existence of an arbitration agreement, while the party opposing the petition bears the burden of¿establishing¿a defense to the agreement's enforcement." '"¿ (Beco v.

Fast Auto Loans ¿(2022) 86 Cal.App.5th 292, 302.)¿ To¿determine¿the existence of an arbitration agreement, the court uses "a three-step burden-shifting process."¿ (Iyere¿v. Wise Auto Group ¿(2023) 87 Cal.App.5th 747, 755.)¿ "The arbitration proponent must first recite verbatim, or provide a copy of, the alleged agreement.¿ [Citations.]¿ A movant can bear this¿initial¿burden 'by attaching a copy of the arbitration agreement purportedly bearing the opposing party's signature.'"¿ (Ibid. ¿[internal citations omitted].)¿ "If the movant bears its initial burden, the burden shifts to the party opposing arbitration to identify a factual dispute as to the agreement's existence¿. . . ."¿ (Ibid.)¿ If the opposing party meets its burden to "submit sufficient evidence to create a factual dispute" as to the existence of the agreement, the burden shifts back to the arbitration proponent, who¿retains¿the ultimate burden of proving its existence by a preponderance of the evidence.¿ (Ibid.) "General principles of contract law determine whether the parties have entered a binding agreement to arbitrate." (Mendoza v.

Trans Valley Transport (2022) 75 Cal.App.5th 748, 777 [quoting Craig v. Brown & Root, Inc. (2000) 84 Cal.App.4th 416, 420] (Mendoza).) "An essential element of any contract is the consent of the parties, or mutual assent, which must be communicated by each party to the other." (Mendoza, supra, 75 Cal.App.5th at p. 777.) "Mutual assent is determined under an objective standard applied to the outward manifestations or expressions of the parties,

i.e., the reasonable meaning of their words and acts, and not the unexpressed intentions or understandings." (Ibid. [internal quotations omitted.]) Courts consider various factors to determine if an arbitration agreement exists based on an arbitration clause in an employee handbook with accompanying acknowledgment forms. (Mendoza, supra, 75 Cal.App.5th at p. 778.) These include: (1) the presence of signature lines on either the arbitration policy or anywhere in the employee handbook; (2) language in the arbitration clause or handbook indicating the employee was expected to sign a separate arbitration agreement; (3) the location of the arbitration clause, its type size and style, and whether it stood out from the rest of the handbook; (4) whether the handbook indicated it was intended to be information, not contractual, could be changed by the employer at any time, or did not create a contract of employment; and (5) whether the acknowledgment form mentions arbitration as opposed to simply agreeing to read the handbook and abide by its policies. (Id. at pp. 783-787.)

In Mendoza, the Court of Appeal found that there was no arbitration agreement. There, the proffered arbitration agreement was contained in an employee handbook and the employee signed an acknowledgement of receipt. After addressing several cases and articulating the aforementioned factors, the Court reasoned that several factors weighed against finding mutual assent. First, the arbitration policy "was not prominently distinguished from the other clauses in the Handbook" and there was no place in the handbook for the employee to sign or acknowledge the arbitration policy in writing. (Mendoza, supra, 75 Cal.App.5th at p. 783-784.)

Second, the employee handbook stated it was for informational purposes only. (Id. at p. 784.) Third, all policies, except for at-will employment, were subject to change at any time by the employer. (Ibid.) Fourth, the handbook stated it was not intended as a contract. (Ibid.) Fifth, the acknowledgement did not mention arbitration, alternative dispute resolution, or the arbitration policy. (Id. at p. 785.) Sixth, the acknowledgement's phrase of "agree to read" assumed the employee had not yet read the handbook when he signed the forms. (Id. at p. 786.)

As in Mendoza, here, there is no agreement to arbitrate. First, the arbitration policy is item number 18 in the employee manual. (Liwak Decl., Exhibit A.) It is in the same font and format of the other headings. (Ibid.) There is no table of contents or anything else to differentiate the policy from the other policies. (Ibid.) Second, the employee manual states: "It is intended to provide you with general information about some of your benefits and the highlights of our rules and policies." (Id. at item 1.)

It goes on to state: "Please note that this manual is provided for informational purposes only." (Ibid.) This is akin to the handbook in Mendoza. Third, it can be changed at any time, aside from the at-will employment policy. (Ibid.) Fourth, the employee manual explicitly states that it does not "constitute[] an express or implied contract of employment or warranty of any benefits." (Ibid.) Fifth, the acknowledgement form does not mention arbitration, alternate dispute resolution, or the arbitration policy at all. (Id. at Exhibit B.)

Instead, it includes an agreement to "read and follow the policies and procedures" in the manual. (Ibid.) This is akin to the

acknowledgement in Mendoza. Taken together, there is no mutual assent. As a result, an arbitration agreement does not exist. Accordingly, the court DENIES Defendant's motion to compel arbitration. CONCLUSION: For the foregoing reasons, the Court decides the pending motion as follows: 1. Motion to compel arbitration is DENIED. Moving party is to give notice. IT IS SO ORDERED. Dated: September 9, 2026 __________________________________ Upinder S. Kalra Judge of the Superior Court

Plaintiff does not challenge her signature on the acknowledgement but, rather, contends it is irrelevant. She does not address Defendant's remaining arguments at all. Case Number: 25STCV24097 Hearing Date: September 9, 2026 Dept: 511 Tentative Ruling Judge Upinder S. Kalra, Department 511 HEARING DATE: September 9, 2026 CASE NAME: David Kay v. Mercedes-Benz USA, LLC, et al. CASE NO.: 25STCV24097 MOTION FOR RELIEF FROM JURY WAIVER MOVING PARTY: Plaintiff David Kay RESPONDING PARTY(S): None REQUESTED RELIEF: 1.

An order granting relief from waiver of jury trial. TENTATIVE RULING: 1. Motion for relief from jury waiver is GRANTED. STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS: On August 15, 2025, Plaintiff David Kay (Plaintiff) filed a complaint against Defendants Mercedes-Benz USA, LLC (Mercedes) and Mercedes-Benz of Southbay (Southbay) (sometimes collectively Defendants) with six causes of action for: (1) violation of lemon law and express warranty; (2)