Gomez v. T-Mobile USA Inc

5 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 6 AT SEATTLE 7 NO. 2:24-cv-1468 OLVIN GOMEZ, individually and on behalf of all others similarly situated, ORDER DENYING MOTION FOR Plaintiff, RECONSIDERATION v. T-MOBILE USA, INC.; and DOES 1-20, as yet unknown Washington entities, Defendants.

This matter comes before the Court on a Motion for Reconsideration, filed by Plaintiff Olvin Gomez. Plaintiff seeks reconsideration of the Court’s Order Granting Motion to Compel Arbitration (“Order”), which directed this matter to arbitration and stayed this case pending the outcome. Dkt. No. 31. In the Order, the Court reviewed the parties’ broad agreement to arbitrate all employment-related claims, like those Plaintiff brought under the Fair Labor Standards Act (“FLSA”). The arbitration agreement was executed in conjunction with an employee stock grant.

The Court’s ruling turned on the delegation provision contained in the arbitration agreement, which delegated to an arbitrator “exclusive authority to resolve any dispute relating to the scope, interpretation, applicability, enforceability, or waiver” of the arbitration agreement. Order at 4-5 (quoting Ibrahim Decl., Ex. 1, at ¶ 1). In opposing Defendant’s Motion to Compel, Plaintiff challenged only the validity and/or enforceability of the arbitration agreement, arguing it had been ORDER DENYING MOTION FOR RECONSIDERATION Relying on Rent-A-Center and its progeny, the Court concluded that in the absence of Plaintiff’s challenge specifically to the delegation provision, that delegation provision was enforceable. Id. at 8 (citing Rent-A-Center, W., Inc. v. Jackson, 561 U.S. 63, 68–69 (2010)). Accordingly, the gateway question of whether the greater arbitration provision as a whole was enforceable was for an arbitrator, and not this Court, to decide.

7 Plaintiff contends in his Motion for Reconsideration, as he did in opposition to the underlying Motion to Compel, that a court must first determine whether the arbitration agreement is enforceable before sending the underlying employment claims to arbitration. However, as this Court has already explained, Rent-A-Center holds that where an arbitration agreement contains a delegation provision, and a plaintiff fails to challenge that delegation provision specifically, that provision—which is severable from the arbitration agreement and independently enforceable— dictates that such questions of arbitrability must be sent to the arbitrator. This is so even where, as here, a plaintiff contends that the greater arbitration agreement was induced by fraud.

15 Accordingly, this Court’s task, under the unchallenged (and therefore presumably enforceable) delegation provision, is to send this matter to arbitration, for an arbitrator to decide whether the arbitration provision is enforceable (and, if so, to decide any remaining substantive claims).

18 Plaintiff misreads Rent-A-Center. In that case, the Supreme Court did observe that “[i]f a party challenges the validity under [Federal Arbitration Act] § 2 of the precise agreement to arbitrate at issue, the federal court must consider the challenge before ordering compliance with that agreement under § 4.” Rent-A-Ctr., 561 U.S. at 71. The Court went on to hold, however, that where that agreement also contains a delegation clause, and the plaintiff fails to challenge the validity or enforceability of that delegation clause, that threshold question must be sent to ORDER DENYING MOTION FOR RECONSIDERATION agreement in which it may be embedded; and a delegation clause is severable from the arbitration clause in which it is embedded. Unless a Plaintiff resisting arbitration challenges the “antecedent” delegation clause itself (and claims, in this case for example, that the delegation clause specifically, and not merely the arbitration clause, was induced by fraud), the threshold questions of arbitrability must go to the arbitrator. See, e.g., Wu v. Uber Techs., Inc., No. 90, 2024 WL 7 4874383, at *10 (N.Y. Nov. 25, 2024) (citing Rent–A–Center, West, Inc., 561 U.S. at 71–72) (“Here, plaintiff does not contend that the delegation provision itself was hidden from her, is unconscionable, or is against public policy. She makes those contentions only with respect to the separate language in the arbitration agreement requiring the parties to arbitrate personal injury claims that accrued prior to its formation. Under the Supreme Court's well-settled severability rule, the delegation provision must be enforced.”); Jenkins v. PetSmart, LLC, No. CV 23-2260, 2023 WL 8548677, at *6 (E.D. Pa. Dec. 11, 2023) (“If a party does not challenge a delegation clause specifically, we ‘must treat it as valid and must enforce it by sending any challenge to the validity of the underlying arbitration agreement to the arbitrator.’”). Plaintiff may find such a procedure to be “nonsensical,” Pl.’s Rep. at 3, but while the wisdom of Rent-A-Center may be debated, its holding cannot be.

18 Plaintiff contends that his agreement to the arbitration clause was fraudulently induced.

19 He does not contend that his agreement to the delegation clause—a distinct and, under the Federal Arbitration Act, severable provision—was fraudulently induced. In the absence of any challenge to the delegation provision itself, under Rent-A-Center, the delegation clause must be deemed enforceable; and it is for an arbitrator to decide whether the arbitration clause was fraudulently induced. See also Caremark, LLC v. Chickasaw Nation, 43 F.4th 1021, 1029 (9th ORDER DENYING MOTION FOR RECONSIDERATION || Cir. 2022) (“In Rent-A-Center, the Court held that a challenge to the validity of an entire || arbitration agreement—there, an unconscionability challenge—must be decided by the arbitrator 3 the agreement includes a delegation clause that is not directly challenged. The Court || emphasized that a party must ‘challenge[ | the delegation provision specifically’ for a court to || intervene.”) (quoting Rent-A-Center, 561 U.S. at 70-72); see also Bielski v. Coinbase, Inc., 87 || F.4th 1003, 1011 (9th Cir. 2023) (“[T]o sufficiently challenge a delegation provision, the party || resisting arbitration must specifically reference the delegation provision and make arguments || challenging it.”).

9 The Court is not denying that Plaintiff has the rnght to challenge the enforceability of the || arbitration agreement; only that he has a right to do so in this Court. Because Plaintiff does not || dispute that the delegation clause itself is valid, under that clause, that gateway question must be || decided by an arbitrator.

13 DATED this 10" day of June, 2025.

Asner eu, Barbara Jacobs Rothstein 16 U.S. District Court Judge ORDER DENYING MOTION ror RECONSIDERATION