1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 6 JULIO ANDRES CRUZ, Case No. 22-cv-06075-JD

7 Plaintiff, ORDER RE ARBITRATION v. 8

9 CAMBRIDGE REAL ESTATE SERVICES, INC., 10 Defendant.

11 12 In this putative employment class action, defendant Cambridge Real Estate Services, Inc., 13 asks to compel arbitration of plaintiff Julio Cruz’s individual claims. Dkt. No. 20. Cruz filed an 14 opposition. Dkt. No. 23. The parties’ familiarity with the record is assumed, and the claims in the 15 complaint are referred to arbitration. 16 BACKGROUND 17 The parties agree that they formed a bilateral agreement to arbitrate employment claims. 18 Cruz does not dispute that he signed an arbitration agreement with Cambridge when he was hired 19 as a maintenance technician in January 2019. Dkt. No. 20-1, Ex. 1. By accepting employment 20 with Cambridge, Cruz agreed “to submit any and all previously unasserted claims, disputes, 21 lawsuits or controversies arising out of or relating to his or her application or candidacy for 22 employment, his or her employment, or the cessation of his or her employment to binding 23 arbitration before a neutral and unbiased arbitrator.” Id. ¶ 1. Cambridge, on its part, agreed “that 24 any claims or causes of action that it asserts against an employee related to his or her employment 25 as defined in paragraph 1 above will also be submitted to binding arbitration pursuant to the terms 26 of this Agreement.” Id. ¶ 6. 27 The arbitration agreement incorporates the American Arbitration Association (AAA) rules 1 arbitrator will conduct the arbitration pursuant to the rules and procedures of the AAA and will 2 have the authority to determine the time and place of hearing, issue subpoenas, decide arbitrability 3 and timeliness issues, decide on discovery issues, preserve order and privacy in the hearing, rule 4 on evidentiary and procedural matters, determine the close of hearing, and procedures for post- 5 hearing submissions, and issue an award resolving the submitted disputes.”). 6 LEGAL STANDARDS 7 The Federal Arbitration Act (FAA) governs here. The FAA applies to contracts 8 “evidencing a transaction involving commerce.”

. The Supreme Court has 9 interpreted “involving commerce” “as the functional equivalent of the more familiar term 10 ‘affecting commerce’--words of art that ordinarily signal the broadest permissible exercise of 11 Congress’ Commerce Clause power.” Citizens Bank v. Alafabco, Inc.,

(2003) (per 12 curiam). Cambridge is in the stream of interstate commerce in that it employs maintenance 13 technicians like Cruz to provide property management services to clients in California, 14 Washington, Oregon, and Idaho. See Dkt. No. 20-1 ¶¶ 2-3. 15 The Court has discussed the governing standards under the FAA in several prior orders, 16 which are incorporated here. See, e.g., Cornet v. Twitter, Inc., No. 3:22-cv-06857-JD,

187498, at *1 (N.D. Cal. Jan. 13, 2023); Louis v. Healthsource Glob. Staffing, Inc., No. 22-cv- 18 02436-JD,

, at *2 (N.D. Cal. Oct. 3, 2022); Williams v. Eaze Sols., Inc.,

Supp. 3d 1233, 1238-39 (N.D. Cal. 2019). In pertinent part, the FAA’s “overarching purpose ... is 20 to ensure the enforcement of arbitration agreements according to their terms so as to facilitate 21 streamlined proceedings.” AT&T Mobility LLC v. Concepcion,

, 344 (2011). Under 22 Section 4 of the FAA, the Court’s role “is limited to determining whether a valid arbitration 23 agreement exists and, if so, whether the agreement encompasses the dispute at issue.” Lifescan, 24 Inc. v. Premier Diabetic Servs., Inc.,

(9th Cir. 2004). If the party seeking to 25 compel arbitration establishes both factors, the district court “must order the parties to proceed to 26 arbitration only in accordance with the terms of their agreement.”

“Any doubts about the 27 scope of arbitrable issues should be decided in favor of arbitration.” Williams, 417 F. Supp. 3d at 1 Unless the parties provide otherwise, the validity and scope of an agreement to arbitrate are 2 determined by the Court. See Oracle Am., Inc. v. Myriad Grp. A.G.,

(9th Cir. 3 2013); Alonso v. AuPairCare, Inc., No. 3:18-cv-00970-JD,

, at *1 (N.D. Cal. 4 Aug. 23, 2018). The validity inquiry usually involves a determination of whether the arbitration 5 agreement is unenforceable because it is unconscionable. See Concepcion, 563 U.S. at 339. 6 Alternatively, parties may delegate “gateway” questions of arbitrability to an arbitrator. 7 See Cornet,

, at *2. A delegation clause is enforceable when it manifests a clear 8 and unmistakable agreement to arbitrate arbitrability, and is not invalid as a matter of contract law. 9 See Brennan v. Opus Bank,

(9th Cir. 2015). Challenges to the validity of a 10 delegation clause may be directed to (1) “the validity of the delegation clause itself,” or (2) “the 11 validity of the agreement to arbitrate or to the contract as a whole.” McLellan v. Fitbit, Inc., No. 12 3:16-cv-00036-JD,

, at *1 (N.D. Cal. Oct. 11, 2017) (citing Buckeye Check 13 Cashing, Inc. v. Cardegna,

(2006)). “[T]he Court retains authority to determine 14 any validity challenges directly addressed to delegation.” Alonso,

, at *1 (citing 15 Rent-A-Center, West, Inc. v. Jackson,

(2010)). But “[i]f a party challenges the 16 overall agreement to arbitrate, without specifically challenging the delegation clause, the questions 17 of validity and enforceability will go to the arbitrator.”

(citing McLellan,

, 18 at *1). 19 DISCUSSION 20 Cruz does not raise any contract formation challenges, and does not dispute that the 21 arbitration agreement covers the claims in the complaint. Cruz’s wage and hour claims, 22 reimbursement claim, wage statement claim, meal and rest break claims, and derivative unfair 23 business practices claim are all rooted in his employment relationship with Cambridge and 24 consequently within the scope of the arbitration agreement. See Dkt. No. 1, Ex. 1; Dkt. No. 20-1, 25 Ex. 1 ¶ 1. 26 Cruz’s main objection is that the arbitration agreement is unconscionable. See Dkt. No. 23 27 at 3-10. Because the agreement has a delegation clause, see Dkt. No. 20-1, Ex. 1 ¶ 5, Cruz must 1 demonstrate that the clause is invalid or otherwise does not encompass his unconscionability 2 || claims in order to litigate in this forum. 3 He has not done so. The delegation clause expressly states that the arbitrator will decide 4 || arbitrability. 7d. This is just the kind of language which establishes that “the parties clearly and 5 || unmistakably agreed to arbitrate the question of arbitrability.”, Momot v. Mastro,

, 6 988 (9th Cir. 2011); see also Mohamed v. Uber Techs., Inc.,

(9th Cir. 2016) 7 (upholding delegation clause that provided arbitrators with “the authority to decide issues relating 8 || to the ‘enforceability, revocability, or validity of the’” arbitration agreements). 9 The incorporation of the AAA rules in the arbitration agreement also “constitutes clear and 10 || unmistakable evidence that contracting parties agreed to arbitrate arbitrability.” Brennan, 796 11 F.3d at 1128; see also McLellan,

, at *2-3 (incorporation of AAA rules in 12 || arbitration agreement “compels arbitration of arbitrability” under Brennan). 5 13 As for Cambridge’s suggestion that the parties waived class or representative actions 14 || because they did not expressly consent to class arbitration, see Dkt. No. 20 at 15, the parties 3 15 agreed to delegate such issues to the arbitrator for decision. See Dkt. No. 20-1, Ex. 1 5; Louis, 16 ||

, at *2. CONCLUSION 18 The claims in the complaint are referred to arbitration, and any issues regarding 19 enforceability or the scope of the arbitration are delegated to the arbitrator. “[A] district court may 20 either stay the action or dismiss it outright when, as here, the court determines that all of the 21 claims raised in the action are subject to arbitration.” Johnmohammadi v. Bloomingdale’s, Inc., 22

(9th Cir. 2014). The case is dismissed. 23 IT IS SO ORDERED. 24 || Dated: April 27, 2023 25 26 7 JAMES PONATO United Ptates District Judge 28