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10 MW 12 14 15 16 7 18 19 20 ae 2B 4 25 26 27 28 PAUL HASTINGS LLP CAMERON W. FOX (SB# 218116) cameronfox@paulhastings.com JARRYD M. COOPER. (SB# 292090) jarrydcooper@paulhastings.com 513 South Flower Street, Twenty-Fifth Floor Los Angeles, California 90071-2228 Telephone: 1(213) 683-6000 Facsimile: 1(213) 627-0705 Attorneys for Defendant GOOGLE LLC ELECTRONICALLY FILED ‘Suporior Court of Caifornia, ‘County of San Francisco 06/11/2018 Clerk of the Court SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SAN FRANCISCO TIM CHEVALIER, Plaintiff, vs. GOOGLE, INC., and Does I through 20 Defendants. CASE NO. CGC-18-564473 MEMORANDUM OF POINTS AN! AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC’S PETITION TO COMPEL ARBITRATION RES. NO.: 06110828-04 Date: August 28, 2018 Time: 9:30am. Dept: 302 Judge Hon. Harold B. Kahn Complaint Filed: February 21, 2018 Trial Date: None MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S LEGAL_US_W# 94543595.3 PETITION TO COMPEL ARBITRATION 1 nm. M1. TABLE OF CONTENTS FACTUAL AND PROCEDURAL BACKGROUND... so THIS COURT SHOULD COMPEL ARBITRATION. cnr 8 A. The Federal Arbitration Act Requires Enforcement Of Arbitration Agreements According To Theit Terms... en B, The Arbitration Agreement Covers Plaintiff's Claims. C. The Arbitration Agreement Is Valid And Should Be Enforced. 1. The Arbitration Agreement is an enforceable contract... 2, The Arbitration Agreement is not unconscionable. ... California’s unconscionability test. u b. The Arbitration Agreement is not pro unconscionable, 12 (1) There was no oppression... 12 2) There was no surprise. 12 (3) The Arbitration Agreement is not substantively unconscionable. smesennneeens 13 ‘The Arbitration Agreement therefore is enforceable... Any unconscionable provision, if there were one, would properly be severed and the remainder of the Arbitration, Agreement enforced... CONCLUSION oy MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGEE LLC'S, PETITION TO COMPEL ARBITRATION ‘ABLE OF AUTHORITIES Page(s) CASES Am, Software, Inc. v. Ali 46 Cal. App. 4th 1386 (1996)... lL, 12 Armendariz v. Found, Health Psychcare Servs., Inc., 24 Cal. 4th 83 (2000)... «passim AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) AT&E Technologies, Inc. v. Comme'n Workers, 475 US. 643 (1986)... Baltazar v, Forever 21, Ine., 62 Cal. 4th 1237 (2016)... Bolter v. Superior Court, 87 Cal. App. 4th 900 (2001). 16 Booker v. Robert Half Int'l, Inc., 413 F.3d 77 (D.C. Cir. 2005) Brinkley v. Monterey Fin. Servs, Inc., 242 Cal. App. 4th 314 (2015). Cape Flattery Ltd. v. Titan Maritime, LLC, 647 F.3d 914 (9th Cir. 2011). Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126 (9th Cir. 2000)... Cireuit City Stores, Inc. v. Adams, 532 U.S. 105 (2001). Circuit City Stores, Inc. v. Naja, 294 F.3d 1104 (9th Cir. 2002) Cruise v. Kroger Co., 233 Cal, App. 4th 390 (2015) nse 14 Davis v. Nordstrom, Inc., 755 F.3d 1089 (9th Cir. 2014), Dean Witter Reynolds, Ine. v. Byrd, 470 US. 213 (1985). “MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S EGAL_US_W# 84543568.3, PETITION TO COMPEL ARBITRATION DIRECTY, Inc. v. Imburgia, 136 8. Ct. 463 (2015)... = 10) Dotson v. Amgen, Inc., 181 Cal. App. 4th 975 (2010)..ssnnsunnemnnnnnimneinnnnnsnnnenenninins eels Ericksen, Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak St., 35 Cal. 3d 312 (1983)... erm : Erickson v, Aetna Health Plans of Cé 71 Cal. App. 4th 646 (1999). Inc., Farrar v. Direct Commerce, Inc., 9 Cal. App. Sth 1257, 1275 (2017) ... Ferguson v. Countrywide Credit Indus., Inc., 298 F.3d 778 (9th Cir. 2002).... aa) Fittante v. Palm Springs Motors, Inc., 105 Cal. App. 4th 708 (2003)... Gatton v. T-Mobile USA, Inc., 152 Cal. App. 4th 571 (2007).. Graham y. Scissor-Tail, Inc., 28 Cal. 34 807 (1981) ll Jones v. Humanscale Corp., 130 Cal. App. 4th 401 (2005). 7 Kinney v. United HealthCare Servs., Inc., 70 Cal. App. 4th 1322 (1999). Lane v. Francis Capital Mgmt. I. 224 Cal. App. 4th 676 (2014). Little v. Auto Stiegler, Inc., 29 Cal. 4th 1064 (2003)... Lucas v. Gund, Inc., 450 F. Supp. 2d 1125 (C.D, Cal. 2006), Marin Storage & Trucking, Ine. v, Benco Contracting & Eng’g, Inc., 89 Cal. App. 4th 1042 (2001). 11, 15, 16 MeManus v. CIBC World Mias. Corp., 109 Cal, App. 4th 76 (2003). Morris v. Redwood Empire Bancorp, 128 Cal. App. 4th 1305 (2005). Ey AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGL ‘MEMORAND! OF POH oases otnaeen PETITION TO COMPEL ARBITRATION See raau een ul 12 B 14 16 7 18 19 2 22 23 24 25 26 27 28 Pac. Corp. Grp. Holdings, LLC v. Keck, 232 Cal. App. 4th 294 (2014) Pinnacle Museum Tower Ass'n v. Pinnacle Mkt, Dev. (US), LLC, 55 Cal, 4th 223 (2012) 11, 13, 18 Poublon v. Cll, Robinson Co., 846 P.3d 1251 (9th Cir. 2017). 16 Roman v. Superior Court, 172 Cal. App. 4th 1462 (2009). 12, 15, 16 Rosenthal v. Great W. Fin, Secs. Corp., 14 Cal. 4th 394 (1996) 10, 11 Sanchez v. Valencia Holding Co.. LLC, 61 Cal. 4th 899 (2015)... Serpa v. Cal. Sur. Investigations, Inc., 215 Cal. App. 4th 695 (2013)... Simula, Inc. y. Autoliv, Inc., 175 F.3d 716 (9th Cir. 1999) Sonic-Calabasas A, Inc. v. Moreno, 57 Cal. 4th 1109 (2013)... Strotz v. Dean Witter Reynolds, 223 Cal. App. 3d 208 (1990) overruled on other grounds by Rosenthal v. Great W. Fin. Secs. Corp., 14 Cal. 4th 394 (1996). United States ex rel. Oliver v. Parsons Co., 195 F.3d 457 (9th Cir. 1999)... United States v, Hornaday, 392 F.3d 1306 (Lith Cir. 2004)... United States v. Mack wan, 445 F.3d 237 (3d Cir. 2006). Star eS 9 U.S.C. § 1 (PEDFRAI ARBITRATION ACT) 9USC. §3. 9USC. §4. 18 U.S.C. § 1831 (UNORM TRADE SECRETS ACT)... 5 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S, LEGAL US, W# 04543608,3 PETITION TO COMPEL ARBITRATION ee Baws 10 12 B 14 15 16 7 18 19 20 22 23 24 25 27 28 CAL, Civ, Cope § 1550. CAL. Civ. PRoc, Cope § 1280... CAL, Gov'r Cope § 12900 (CAL. FAIR EMPLOYMENT AND HOUSING ACT), Rutes JAMS R. 15. JAMS R. 16. JAMS R. 17. JAMS R. 24(0) JAMS R. 24(h) 6 MEMORANDUM OF POINTS AND AUTHORITIBS IN SUPPORT OF DEFENDANT GOOGLE LLC'S, LEGAL_US_W# 94543695.3 PETITION TO COMPEL ARBITRATION ew aa uW 12 1B 4 16 7 18 19 20 21 22 24 25 26 27 28 Plaintiff Tim Chevalier sued Google LLC’ in state court, despite his contractual promise to bring this case in arbitration. ‘This Court should compe! his claims to individual arbitration and stay this court action pending its completion. iL FACTUAL AND PROCEDURAL BACKGROUND On February 1, 2018, Plaintiff sued Google, alleging retaliation on the basis of engaging in protected activity, hostile work environment, failure to prevent discrimination and harassment, and wrongful termination. See Compl., 4¥ 59-113. However, Plaintiff is bound by Google’s Arbitration Agreement (“Arbitration Agreement”), in which be agreed that “any and all controversies, claims, or disputes ... arising out of, relating to, or resulting from” his employment with, or termination from, Google and its “subsidiaries, affiliates, successors or assigns” would be “subject to binding arbitration.” Miguel Decl., Exh. C, pp. 1, 3. Under the Arbitration Agreement, the claims at issue here must be arbitrated Plaintiff signed the Arbitration Agreement at the time of, and as a condition of, being hired by Google as a Site Reliability Engineer, Members of Google’s recruiting team sent Plaintiff an offer letter and other preemployment documents (including the Arbitration Agreement). Plaintiff then completed these documents using a unique, personal user identification number assigned to Plaintiff by Google. Specifically, Plaintiff accepted Google’s offer and entered into the Arbitration Agreement by affixing his electronic signature using Google's document-signing feature, Miguel Decl., §§ 3-7. Nevertheless, Plaintiff has refused to agree to move this case into arbitration. On April 2, 2018, Google contacted Plaintiff's attorney, advised him of the existence of the Arbitration Agreement, and informed him that Google would move to compel arbitration if Plaintiff did not stipulate to arbitrate. Declaration of Jamyd M. Cooper (“Cooper Decl.”) 4, Plaintiff's counsel has refused. Za. ' Google, Inc. became Google LLC in 2017. Declaration of Diane Miguel, Exh. C, p. 3 (“Miguel Decl.”) 4 1. ? On April 8, 2018, the parties stipulated to stay the case until June 11, 2018. ‘MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDA) EGAL_US_Wi#94643508.3 PETITION TO COMPEL ARBITRATION I THIS COUR’ SHOULD, MPEL ARBITRATION AS ‘The Federal Arbitration Act Requires Enforcement Of Arbitration Agreements According To Their Terms. The Federal Arbitration Act (“FAA”) permits a party to a written arbitration agreement to petition for an order compelling the parties to arbitrate, 9 U.S.C. § 4. The FAA applies to contracts in the employment context, except for those involving certain “transportation workers.” Cireuit City Stores, Inc, v. Adams, 532.U.S. 108, 119 (2001). The FAA applies here because Plaintitt worked as a Google Site Reliability Engineer developing and maintaining Google 's in interstate commerce. Compl. 4 12; Cooper Decl. Exh. B.* products and serv The FAA “reflects a ‘liberal federal policy’ in favor of arbitration.” Davis v. Nordstrom, Inc., T55 F.3d 1089, 1092 (9th Cir. 2014) (quoting AT&T Mobility LLC v. Concepcion, $63 US. 333, 339, 346 (2011)). Where a dispute falls within the scope of a valid agreement to arbitrate, the FAA requires the court to dir ot the partie wo arbitrate. Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218 (1985). The FAA further directs the court to stay all proceedings pending completion of arbitration. See 9 U.S.C. § 3 (“[T]he court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement , ...”).* ogle is a global computer software and web search engine company that offers a wide variety of intermet-related services and products. Cooper Decl., EX. A. These services and products relate to, among other areas, internet searches, advertising, operating systems, and hardware products such as cellular telephones, that are used throughout the United States and internationally. Id The Complaint admits that Plaintiff was employed as a Site Reliability Engineer. (Comp. § 12) His engineering services were part and parcel of the maintenance, progression and use of Google’s products by individuals both within and outside California, amply satisfying any required nexus to interstate commerce. Cooper Decl., Exs. A & B; see, e.g., United States vy. MacEwan, 445 F.3d 237, 245 (3d Cir. 2006) (“T]he Internet is an instrumentality and channel of interstate commerce.”); see also United States v. Hornaday, 392 F.3d 1306, 1311 (11th Cir. 2004) (“Congress clearly has the power to regulate the internet, as it does other instrumentalities and channels of interstate commerce . . . .”); see generally Erickson v. Aetna Health Plans of Cal,, Inc., 71 Cal. App. 4th 646, 651 (1999) (FAA coverage is ;oextensive with congressional power to regulate under the Commerce Clause”) (citations omitted), * The FAA applies here, but California state law, Cal, Civ. Proc. Code § 1280, ef seg., produces the same result, See, e.g., Baltazar v. Forever 27, Ine., 62 Cal. 4th 1237, 1247 n.3 2016) (enforcing agreement under state law even though FAA coverage was disputed); Lane v. Francis “MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S LEGAL_US_W 94543698.9 PETITION TO COMPEL ARBITRATION | | i B. ‘The Arbitration Agreement Covers Plaintiff's Claims, An order to arbitrate “should not be denied unless il may be said with positive assurance ‘that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute,” ATE&I Technologies, Inc. v. Comme’n Workers, 475 US. 643, 650 (1986). Accordingly, “[alny doubts conceming the scope of arbitrable issues should be resolved in favor of arbitration.” Simula, Ine. v. Autoliv, Inc., 175 F.3d 716, 719 (Oth Cit, 1999) (internal quotation marks and citation omitted). Courts distinguish between “broad” and “narrow” arbitration provisions. “*[W]hen parties intend to include a broad arbitration provision, they provide for arbitration “arising out of or relating to’ the agreement.”” Brinkley v. Monterey Fin. Servs., Inc., 242 Cal. App. 4th 314, 331 (2015) (emphasis in original) (quoting Cape Flattery Ltd. v. Titan Maritime, LLC, 647 F.3d 914, 922 (9th Cir. 2011)). Here, the Arbitration Agreement is broad, as in Brinkley; it applies to all claims “controversies, claims, or disputes . . . arising out of, relating to, or resulting from [Plaintit?’s] employment with Google or the termination of [Plaintiff's] employment with Google, «2° Miguel Decl., Exh. C, p. 3. Arbitrable claims include, but are not limited to, “any statutory claims under local, state, or federal law . .. ‘The California Fair Employment and Housing Act, ‘The California Labor Code, {and] claims of harassment, discrimination, [or] wrongful termination.” Miguel Decl., Exh. C, p.3. ‘That language plainly covers Plaintiff's claims: three California Labor Code, three Fair Employment and Housing Act, and one wrongful termination claims, all related to his Google employment. Plaintiff's claims therefore are covered, CG The Arbitration Agreement Is Valid And Should Be Enforced. Plaintiff made a valid agreement to arbitrate with Google, as shown below. Capital Mgmt. LLC, 224 Cal. App. 4th 676, 688, 689-93 (2014) (same). The California Supreme Court has long recognized “this state’s strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution.” Lricksen, Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak Si., 35 Cal. 3d 312, 322 (1983), In Armendariz v. Found. Health Psychcare Servs., Inc., 24 Cal. 4th 83, 97 (2000), the California Supreme Court reiterated: “California law, like federal law, favors enforcement of valid arbitration agreements, ... California courts and its Legislature have ‘consistently reflected a friendly policy toward the arbitration process.”” (citations omitted). 9. LEGAL_US_W#.94543698,9 PETITION TO COMPEL ARBITRATION i RON 1, The Arbitration Agreement is an enforceable contract, In determining whether a valid arbitration agreement exists, courts apply ordinary state~ law principles of contract formation. DIRECTV, Inc. v. Imburgia, 136 S. Ct. 463, 473 (2015) (reversing a California state court that had failed to do so); see also Davis, 755 F.3d at 1093 (citing Ferguson v, Countrywide Credit Indus., Inc., 298 F.3d 778, 786 (9th Cit. 2002)). Arbitration agreements are presumed to be valid; the party seeking to avoid arbitration bears the burden of demonstrating otherwise. See, e.g., Chiron Corp. v. Ortho Diagnostic Sys., Inc.,207 F.3d 1126, 1130 (9th Cir. 2000). ‘Under California law, a contract requires (a) the parties’ consent, and (b) consideration. See Cal. Civ. Code § 1550; United States ex rel. Oliver v. Parsons Co., 195 F.3d 457, 462 (9th Cir, 1999), Both requirements are met here. First, Google and the Plaintiff consented to be bound by the Arbitration Agreement. “The manifestation of mutual consent is generally achieved through the process of offer and acceptance, [and] is determined under an objective standard applied to the outward manifestations or expressions of the parties, i.c., the reasonable meaning of their words and acts, and not their unexpressed intentions or understandings.” Pac. Corp. Grp. Holdings, LLC v. Keck, 232 Cal. App. 4th 294, 309 (2014) (internal citations and quotation marks omitted). Here, Plaintiff ‘manifested his assent to be bound by signing the Arbitration Agreement as part of the on- boarding proce: Second, sufficient consideration exists fo support the promises to arbitrate, The Arbitration Agreement was a condition of hire, so the Plaintiffs jobs supplied consideration without more, Miguel Decl. Exh. C, p. L. In addition, Google too was bound to arbitrate any claims it might have had against Plaintiff. Zd. at p.3. The Arbitration Agreement applies to any dispute between the parties relating to the employment relationship, including those in which Google normally would be the plaintiff, such as those under the Uniform Trade Secrets Act. Id. p.3. “[I The parties’ mutual promises to forego a judicial determination and to arbitrate their disputes provide consideration for each other.” Strotz v. Dean Witter Reynolds, 223 Cal. App. 34 208, 216 (1990), overruled on other grounds by Rosenthal v. Great W. Fin, Sees, Corp., 14 Cal, -10- MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEI LEGAL_US Wi 94549508,3 PETITION TO COMPEL ARBITRATION INDANT GOOGLE LLC'S: | aoa 4th 394 (1996); Circuit City Stores, Inc. v. Najd, 294 F.3d 1104, 1108 (9th Cir, 2002) (employer's promise to be bound by the arbitration process serves as adequate consideration). 2, The Arbitration Agreement is not unconscionable, Plaintiff cannot demonstrate that the Arbitration Agreement is unconscionable, ay California’s unconscionability test. Unconseionability is an affirmative defense to the enforcement of a contract. Graham v. Scissor-Tail, Inc., 28 Cal. 3d 807, 820 (1981). “The party resisting arbitration bears the burden of proving unconscionability.” Pinnacle Museum Tower Ass'n y. Pinnacle Mkt, Dev. (US), LLC, 55 Cal, 4th 223, 247 (2012) (citations omitted); see also Rosenthal, 14 Cal, 4th at 413 (“If the party opposing the petition raises a defense to enforcement ... that party bears the burden of producing evidence of, and proving by a preponderance of the evidence, any fact necessary to the defense.”). An agreement to arbitrate is unenforceable only where both substantive and procedural unconscionability exist; itis not enough that one may exist without the other. See, e.g., Armendariz, 24 Cal. 4th at 114 (both forms of unconscionability must be present to defeat contract formation); Fittante v. Palm Springs Motors, Inc., 105 Cal. App. 4th 708, 723 (2003) (same), “With a concept as nebulous as “unconscionability,’ it is important that courts not be thrust in the paternalistic role of intervening to change contractual terms that the parties have agreed to merely because the court believes the terms are unreasonable.”” Marin Storage & Trucking, Inc. v. Benco Contracting & Eng’g, Inc., 89 Cal. App. 4th 1042, 1055 (2001) (quoting Am. Software, Inc. v. Ali, 46 Cal. App. 4th 1386, 1391 (1996)). As the California Supreme Court reiterated, “[t]he unconscionability inquiry is not a license for courts to impose their renditions of an ideal arbitral scheme.” Sonic-Calabasas A, Inc. y. Moreno, 57 Cal. 4th 1109, 1148 (2013). “[Clourts may not decline to enforce an arbitration agreement simply on the ground that it appears to be a bad bargain or that one party could have done better.” Jd.; accord Sanches v. Valencia Holding Co.. LLC, 61 Cal. 4th 899, 911 (2015) (“A party cannot avoid a contractual obligation merely by complaining that the deal, in retrospect, was unfair or a bad bargain.”) As shown below, the Arbitration Agreement is neither procedurally nor substantively “lle MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S LEGAL_US_W# 94543688.3 PETITION TO COMPEL ARBITRATION unconscionable, and certainly not both. b. The Arbitration Agreement is not procedurally unconscionable. “Procedural unconscionability concems the manner in which the contract was negotiated and the circumstances of the parties at that time.” Kinney v. United HealthCare Servs., Inc., 70 Cal. App. 4th 1322, 1329 (1999) (internal quotation marks and citation omitted). Whether an agreement is procedurally unconscionable depends on whether there is (i) “‘oppression’ arising from an inequality of bargaining power,” or (ii) “surprise” arising from buried terms in a complex printed form.” MeManus v. CIBC World Mkts. Corp., 109 Cal. App. 4th 76, 87 (2003) (Citation omitted). Neither element is present here. (1) There was no oppression. Plaintiff is an educated software engineer, fully capable of evaluating his job options and the terms and conditions thereof. Compl. {11 (stating that Plaintiff is “an accomplished software developer and computer scientist;” holds a “Bachelor of Science from Wellesley College in has a “Masters in Computer Science from Berkeley;” and Computer Science and Mathematics has “extensive work experience at [technology companies] Mozilla, AlephCloud Systems, Inc., and Heroku”); cf Am. Software, 46 Cal. App. 4th at 1391-92 (finding no procedural unconscionability in a contract between a company and an educated salesperson). (2) There was no surprise. “Surprise involves the extent to which the terms of the bargain are hidden in a ‘prolix printed form’ drafted by a party in a superior bargaining position.” Roman v. Superior Court, 172 Cal. App. 4th 1462, 1469 (2009) (citations omitted), In Roman, the court found that any procedural unconscionability was minimal because the arbitration provision “was not buried in a lengthy employment agreement;” rather, it was contained on the last page of a seven-page employment application under an appropriate heading. Id, at 1470-71 Here, the Arbitration Agreement was part of a plainly-worded document titled “At-Will Employment, Confidential Information, Invention Assignment And Arbitration Agreement.” Miguel Decl., Exh. C, p. 1. The Arbitration Agreement was set forth in a distinct section within this document. Jd, pp. 3-4. The Arbitration Agreement was titled “Arbitration and Equitable “12- MEMORANDUM OF POIN LEGAL_US_W # 94543595.3, PETITION TO COMPEL ARBITRATION ‘AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LL@S | in bold-face, underlined type. Jd, p. 3. There is simply no reasonable argument that the nature or importance of the Arbitration Agreement was hidden from Plaintiff. See, e.g., Pinnacle, 55 Cal. 4th at 247 & n.12 (2012) (rejecting contention of unconscionability; “[T]he trial court found no evidence of surprise,” and “[w]e agree. The record reflects that the arbitration provisions , . . appear in a separate article under a bold, capitalized, and underlined caption . .. and within a separate section with [a] bold and underlined title ...”). (3) The Arbitration Agreement is not substantively unconscionable. Even if (erroneously, in Google’s view) this Court perecived some trace of procedural uncon: ionability, the Arbitration Agreement still is enforceable because there is no substantive unconscionability. Armendariz held that, for an employment arbitration agreement to be enforceable, it must meet certain “minimum requirements” to ensure that substantive rights afforded by statute are not waived. Specifically, an arbitration agreement is enforceable if it provides for: (j) a neutral arbitrator, (ji) a written decision subject to limited judicial review; (iii) payment by the employer of all costs unique to arbitration; (iv) adequate discovery; and (y) recovery of all statutory remedies. Armendariz, 24 Cal, 4th at 90-91, 103-13. ‘The Arbitration Agreement meets all of those requirements. First, the Arbitration Agreement provides for a neutral arbitrator by incorporating the Judicial Arbitration & Mediation Services’ Employment Arbitration Rules & Procedures. Miguel Decl., Exh. C, pp. 3-4, Specifically, JAMS Rule 15 provides a mechanism by which a neutral arbitrator may be selected through the parties’ mutual striking of potential arbitrators from a JAMS list. Cooper Deel., Exh. C, pp. 14-15. Second, the Arbitration Agreement expressly provides that “the decision of the Arbitrator will be in writing.” Miguel Decl., Exh. C, p. 4. The JAMS Rules also ensure a written decision; Rule 24(h) mandates that an award “shall consist of a written statement .. . regarding the disposition of each claim and the relief, if any, as to each claim.” Cooper Decl., Exh. C, p. 22. ‘The award must also include “a concise written statement of the reasons” for the award. Id. -13- MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC’S LEGAL_US_W 94543698,3 PETITION TO COMPEL ARBITRATION Third, the Arbitration Agreement expressly provides that Google “will pay for any administrative or hearing fees charged by the Arbitrator or IAMS except that [the employee] will pay any filing fees associated with any arbitration that [the employee] initiate[s], but only so much of the filing fees as [the employee] would have instead paid had [the employee] filed a complaint in a court of law.” Miguel Decl., Exh. C, p. 4, That language precisely tracks Armendariz, which said that the employee can be asked to bear an “expense that the employee ‘would .. . be required to bear if he or she were . .. to bring the action in court.” Armendariz, 24 Cal. 4th at 110-11 to recover all otherwise-available Fourth, the Arbitration Agreement permits Plai remedies, by providing that “[t]he Arbitrator will have the power fo award any remedies available under applicable law[,]” Miguel Decl., Exh. C, p. 4. JAMS Rule 24(c) also provides that all remedies and relief are available: “The Arbitrator may grant any remedy or relief that is just and equitable and within the scope of the Parties” agreement, including, but not limited to, specific performance of a contract or any other equitable or legal remedy.” Cooper Deel., Exh. C, p. 22. Since “nothing in the language of the [Agreement] limits remedies,” “no limitation should be implied.” See Little v, Auto Stiegler, Inc.,29 Cal. 4th 1064, 1075 n.1 (2003). Fifth, toe Arbitration Agreement provides for adequate discovery, The Arbitration Agreement, which incorporates JAMS Rules 16 and 17 by reference, entitles the parties to discovery. For example, JAMS Rule 17 expressly requires, among other procedures, that the parties exchange “all non-privileged documents . .. relevant to the disputef.|” Cooper Decl., Exh. C,p. 16. JAMS Rule 17 further entitles each party to at least one deposition. 1d. at pp. 16-17. Even if the Arbitration Agreement did not incorporate JAMS rules regarding discovery, the Arbitration Agreement would still be construed as fully consistent with Armendariz. See Cruise v. Kroger Co., 233 Cal. App. 4th 390, 39-400 (2015) (arbitration agreement lacking “precise terms” regarding arbitration procedure is enforceable, and is governed by the procedures set forth in the California Arbitration Act, Cal. Civ. Proc. Code §§ 1280, ef seg.); see also Little, 29 Cal. Ath at 1081 (enforcing an arbitration agreement because it was “[nJo[t] . . . evident from the agreement that Little will be unable to obiain adequate discovery”); accord Booker v, Robert Half -14- MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S” LEGAL_US_W# 94549598.3 PETITION TO COMPEL ARBITRATION Int, Ine., 413 F.3d 77, 81-82 (D.C. Cir, 2005) (Roberts, J.) (enforcing arbitration agreement even though plaintiff contended that an arbitrator might “compromise [plaintif?'s] right to requisite discovery;” a party cannot oppose arbitration with “mere speculation’ about how an arbitrator “might” interpret or apply the agreement”) ¢. The Arbitration Agreement therefore is enforceable. “Both procedural uneonscionability and substantive unconscionability must be shown” before an agreement may be held unenforceable. Pinnacle, 55 Cal. 4th at 247, If this Court concludes, as it should, that at least one form of unconscionability is wholly absent, the Arbitration Agreement is enforceable without more, Alternatively, the Arbitration Agreement should be enforced even if (erroneously, in Google’s view) this Court found both forms of unconscionability to be present. A reviewing. court’s task “is not only to determine whether .. . unconscionability exists, but more importantly, to what degree it may exist.” Morris v. Redwood Empire Bancorp, 128 Cal. App. 4th 1305, 1319 (2005) (emphasis in original), Where there is minimal procedural unconscionability, the party opposing arbitration must show a high level of substantive unconscionability (or vice versa). Eg, Armendariz, 24 Cal. 4th at 114 (“[I]he more substantively oppressive the contract term[s], the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.”); Dotson v. Amgen, Inc., 181 Cal. App. 4th 975, 982 (2010) (“Because the degree of procedural unconscionability is minimal, the agreement is unenforceable only if the degree of substantive unconscionability is high.”); Roman, 172 Cal. App. 4th at 1469 (same). In the Supreme Coutt’s ruling in Baltazar, the plaintiff was given an arbitration agreement and told in a job interview, “[S]ign it or no job.” Baltazar, 62 Cal. 4th at 1241. The unanimous Supreme Court nevertheless enforced the arbitration agreement. Even if there was a small amount of procedural unconscionability, the necessary level of substantive unconscionability did not exist, the Court explained. Similarly, in Marin Storage, 89 Cal. App. 4th at 1056, the court found that “procedural unconscionability, although extant, was not great” in light of all the circumstances. -15- MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT LEGAL_US_W# 94543508.3 PETITION TO COMPEL ARBITRATION | the low level of procedural unfaimess, we conclude that a greater degree of substantive unfaimess than has been shown here was required before the contract could [be invalidated].” Id, The court therefore enforced the agreement. See also Serpa v. Cal. Sur. Investigations, Inc.,215 Cal. App. 4th 695, 704 (2013) (“When, as here, there is no other indication of oppression or surprise, ‘the degree of procedural unconscionability of an adhesion agreement is low, and the agreement will be enforceable unless the degree of substantive unconscionability is high.””) (citation omitted); Gatton v, T-Mobile USA, Inc., 152 Cal. App. 4th 571, 586 (2007) (in light of the minimal degree of procedural unconscionability, plaintif was required to “make a strong showing of substantive unconscionability”). The Arbitration Agreement is not unconscionable at all, but even assuming otherwise arguendo, it should be enforced under California’s stiding-scale test d. Any unconscionable provision, if there were one, would properly be seyered and the remainder of the Arbitration Agreement enforced. California law abhors “throw[ing] the [arbitration] baby out with the bath water.” Bolter v, Superior Court, 87 Cal. App. 4th 900, 910 (2001). “[T]he strong legislative and judicial preference is to sever the offending term and enforce the balance of the agreement. ...” Roman, 172 Cal. App. 4th at 1477; see Farrar v, Direct Commerce, Inc., 9 Cal. App. Sth 1257, 1275 (2017) (compelling arbitration after severing the “aspect in which the arbitration provision is substantively unconscionable”); Lucas v. Gund, Inc., 450 F. Supp. 2d 1125, 1134 (C.D. Cal. 2006) (ordering two provisions severed; “[S]ubstantive unconscionability does not ‘permeate? this agreement as it contains only two objectionable provisions which are easily severable.”), The ‘inth Cirouit in Poublon v, C.H. Robinson Co., 846 F.3d 1251, 1273 (9th Cir. 2017), enforced an agreement following severance of multiple provisions: “Poublon argues that an agreement is necessarily permeated by unconscionability if more than one clause in the agreement is unconscionable or illegal, We disagree...” ub ah -16. ~~ MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S LEGAL_US_W 94543695.3 PETITION TO COMPEL ARBITRATION 16 If this Court were to find one (or more) unconscionable provisions in the Arbitration ‘Agreement, the appropriate remedy would be to sever or limit it (or them) and then enforce the rest. I, CONCLUSION Plaintiff promised fo arbitrate any disputes he might have with Google. Accordingly, Google respectfully requests that this Court order Plaintiff to submit his claims to arbitration pursuant to the Arbitration Agreement and stay this action pending completion of arbitration. DATED: June 11, 2018 PAUL HASTINGS LLP 5 See, e.g, Little, 29 Cal. 4th at 1074, 1075-76 (severing unconscionable appeals provision and finding arbitration agreement “valid and enforceable once the unconscionable appellate arbitration provision [was] deleted;” severance was necessary in order fo give effect to the parties” intent to arbitrate and to “prevent parties from gaining undeserved benefit or suffering undeserved detriment as a result of voiding the entire agreement™) (citations omitted); Jones v. Humanscale Corp., 130 Cal. App. 4th 401, 416-17 (2005) (reversing a trial court that had declined to sever an unconscionable provision); see also Booker, 413 F.3d at 86 (enforcing arbitration agreement after severing provision precluding punitive damages; severance is consistent with FAA’s requirement “that we rigorously enforce agreements to arbitrate”) (citation and internal quotation marks omitted). oe MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANT GOOGLE LLC'S LEGALUS_W# 54543598. PETITION TO COMPEL ARBITRATION | |