HLEtJ COURT0~ APrEALS 1W~ STATE OF WASHINGTOh

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### 2019FE8 II 

## M11I:OO

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION ONE JEOUNG LEE and SHERRI 

### ) No. 77694-1-I MCFARLAND, on theirown behalf 

### ) and on behalf ofall persons similarly 

### ) situated, 

### ) ) Respondents, 

### )

) ) ) EVERGREEN HOSPITAL MEDICAL CENTER, a/k/a KING COUNTY PUBLIC HOSPITAL DISTRICT #2,

Appellant.
VERELLEN, J. —A union employee working fora public employerdoes not waive herabilityto bring statutorywage and hourclaims in ajudicial forum unless hercollective bargaining agreement (CBA) clearly and unmistakably does so. Because, on its face, the CBA between the Washington State Nurses’ Association (WSNA) and Evergreen Hospital (Evergreen) does notwaive union members’ abilities to enforce theirstatutory rights in ajudicial forum, the trial court correctly denied Evergreen’s motion to compel arbitration. Even if Evergreen had the rightto compel arbitration underthe CBA, it waived any rightto do so by its conduct. A litigantwaives its rightto invoke arbitration where it knows of its rightto arbitrate and engages in conduct

v. 

### )

) ) ) ) PUBLISHED OPINION FILED: February 11,2019No. 77694-1 -1/2

inconsistentwith seeking arbitration, such as actively litigating and passing an obvious opportunityto assertthat right. Evergreen noted its rightto arbitrate in its
answerto Jeoung Lee’s initial complaint. Evergreen actively litigated the dispute for nine months and then opposed Lee’s motion to continue the impending trial date, declaring itwas readyto litigate as scheduled. Three weeks later, Evergreen filed its motion to compel arbitration. Because Evergreen knew ofany rightto compel arbitration, litigated vigorously, and passed an obvious opportunityto assert its rightto compel arbitration, Evergreen waived its right. Therefore, we affirm. FACTS Lee was an emergency room nurse at Evergreen from February2010 until August 2016. The terms of heremploymentwere governed by a CBA between Evergreen and WSNA. To resolve nurses’ work-related grievances, the CBA provided a set of informal procedures culminating with the option ofarbitration. The CBA also contained a provision about nurses’ meal and rest breaks. Lee filed a putative class action in November2016 with herselfas the sole representative plaintiffalleging that Evergreen denied emergency room nurses theirstatutorily guaranteed rest and meal breaks. Evergreen filed an answer in December denying that class certification was appropriate and raising an affirmative defense alleging that Lee “failed to exhaustthe grievance and arbitration process underthe applicable collective bargaining agreement.”1 On

1 Clerk’s Papers (CP) at 10.

2No. 77694-1-U3

January 17, 2017, Lee filed a first amended complaint making identical rest and meal break allegations.2 Overthe next six months, the parties engaged in discovery, conducted depositions, disagreed abouttrial dates, and disputed class certification. Lee also sent out class notices to over500 nurses afterthe court certified the proposed class. On July26, Evergreen deposed class member Sherri McFarland. Soon after, Lee moved to continue the trial date from November of2017 to March of 2018 and to amend her complaint by adding McFarland as a representative plaintiff. Evergreen opposed Lee’s motion to continue and argued trial should go forward as scheduled. The court granted Lee’s motion to continue. On August 15, the court also granted Lee’s motion to file hersecond amended complaint, which is the operative complaint. Two weeks later, Evergreen filed its motion to compel arbitration and alleged “Plaintiffs’ second amended complaint, recent discovery requests, and deposition testimony ofclass representatives now make clearthatthe claims arise underthe [CBA].”3 The court denied Evergreen’s motion to compel arbitration. Evergreen appeals.

2 Lee originallyfiled to certify a class under CR 23(b)(2), and Evergreen moved to dismiss because she sought damages. The first amended complaint was essentiallythe same, exceptforseeking class certification pursuantto CR 23(b)(3).

~ CP at 544.

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ANALYSIS

We reviewde novo denial ofa motion to compel arbitration.4 We also review de novo whether a partywaived the rightto compel arbitration.5 WhetherThe CBA Requires Arbitration Evergreen contends the CBA compels binding arbitration ofall class claims because Lee’s alleged violations arise from section 7.7 ofthe CBA, notfrom any statute or regulation.6 The Federal Arbitration Act (FAA)7 generally applies to CBAs.8 We apply federal substantive lawto any arbitration agreementwithin the coverage ofthe FAA.9 When reviewing a motion to compel arbitration, we consider “whetherthe arbitration agreement is valid” and ‘‘whetherthe agreement encompasses the

~ Coxv. Kroqer Co., 2 Wn. App. 2d 395, 403, 409 P.3d 1191(2018). The parties debate whether a motion to compel arbitration may be made as a general motion orwhether it must be made pursuantto CR 12(c) or CR 56. Butthe issue is purely academic because Evergreen advised the trial court itwas moving pursuantto CR 12, and both parties urge us to consider materials outside the pleadings. Thus, our review is de novo regardless ofwhich civil rule governed Evergreen’s motion to compel arbitration.

~ Romney ex rel. Estate of Romneyv. Franciscan Med. Gm., 199 Wn. App. 589, 602, 399 P.3d 1220, review denied, 189 Wn.2d 1026 (2017). 6 Evergreen addresses Lee and McFarland’s individual claims separately from class claims and contends both must be submitted to arbitration. Because Evergreen did not appeal class certification, and we do not considerthe underlying issues—e.g., class certification—on appeal ofa motion to compel arbitration, Peninsula Sch. Dist. No. 401 v. Public Sch. Emp. of Peninsula, 130 Wn.2d 401, 413, 924 P.2d 13 (1996), we treat all claims as class claims.

~ 9 U.S.C. 

### §~ 1-14.

~ Cox, 2 Wn. App. 2d at403. ki. at403-04.

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claims asserted.”1° If both criteria are met, then Washington courts order arbitration in most instances.11 The parties do not dispute the validity ofthe CBA. The critical question iswhether Lee’s claims are statutory orcontractual.12 Evergreen relies on RCW49.12.187 to argue Lee’s claims are contractual because the statute gives public employers and public employee unions the ability to negotiate CBAs “that specificallyvaryfrom orsupersede, in part or in total, rules adopted underthis chapter regarding appropriate rest and meal periods.”13 But section 7.7 does notvaryfrom orsupersedeWAC 296-126-092. And this CBA’s grievance process does not encompass statutory claims. Article 16 in the CBA provides afour-step grievance process.14 The CBA defines a grievance as “an alleged breach ofthe expressterms and conditions” of

10 k~. at 404 (quoting Wiese v. CACH, LLC, 189 Wn. App. 466, 474, 358 P.3d 1213 (2015)).

1~ Estate of Romney, 199 Wn. App. at 596-97.
12 Evergreen argues this court lacksthe authorityto comparethe CBAwith meal and rest break regulations because issues ofarbitrability must be resolved by an arbitrator. Butthreshold questions around arbitrability—questions about “whetherthe parties have submitted a particulardispute to arbitration”—should be resolved by courts unless the parties clearly and unmistakably provided otherwise in their CBA. Martin v. Yasuda, 829 F.3d 1118, 1123 (9th Cir. 2016) (quoting Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 83, 123 5. Ct. 588, 154 L. Ed. 2d 491 (2002)); accord FutureSelect Portfolio Mcimt., Inc. v. Tremont Grp. Holdings, Inc., 190 Wn.2d 281, 287, 413 P.3d 1(2018). Because the CBAdoes not provide otherwise, we determine if Lee’s claims are arbitrable.

13 RCW49.12.187.
14 First, a nurse must present herwritten grievanceto hersupervisor. Second, if unresolved, she must present herwritten grievanceto the chief nurse executive. Third, ifstill unresolved, the nurse must present hergrievance to an administrator. Fourth, “[ijfthe grievance is not settled on the basis ofthe foregoing

5No. 77694-1-116

the agreement.15 The terms ofthis CBA do not allow an alleged statutory breach to be grieved underthis narrow definition. Chapter49.12 RCW authorizes the creation of regulations about meal and rest periods foremployees, which are defined in WAC 296-126-092:

(1) Employees shall be allowed a meal period ofat leastthirty minuteswhich commences no less than two hours nor more than five hours from the beginning ofthe shift. Meal periods shall be on the employer’s time when the employee is required bythe employer to remain on duty on the premises orat a prescribed work site in the interestofthe employer. (2) No employee shall be required to work more than five consecutive hours without a meal period. (3) Employees working three or more hours longerthan a normal work day shall be allowed at least one thirty-minute meal period priorto orduring the overtime period. (4) Employees shall be allowed a rest period of not less than ten minutes, on the employer’s time, for each four hours ofworking time. Rest periods shall be scheduled as nearas possible to the midpoint ofthe work period. No employee shall be required to work morethan three hourswithout a rest period. (5) Where the nature ofthe work allows employees to take intermittent rest periods equivalentto ten minutes for each 4 hours worked, scheduled rest periods are not required. Section 7.7 ofthe CBA addresses meal and rest periods for nurses: Meal periods and rest periods shall be administered in accordance with state law (WAC 296-126-092). Nurses shall be allowed an unpaid meal period ofone-half (1/2) hour. Nurses required bythe Employerto remain on duty during their meal period shall be compensated forsuch time atthe appropriate rate of pay. All nurses procedures, [WSNA] may submitthe issue in writing to final and binding arbitration.” CP at 107.

15 CP at 106 (emphasis added).

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shall be allowed a rest compensated forsuch time atthe appropriate rate of pay. All nurses shall be allowed a rest period offifteen (15) minutes on the Employer’s time, foreach four (4) hours ofworking time.~1 6] Contraryto Evergreen’s contentions, section 7.7 in the CBA merely comports with WAC 296-126-092. Section 7.7 states meal and rest breaks ‘shall be administered in accordance with” WAC 296~126~092.17 Notably, the regulation is more extensive than section 7.7 and addresses matters on which the CBA is silent.18 Forexample, section 7.7 does not provide guidance on when nurses can take rest breaks. WAC 296-126-092(4) requires that rest periods be scheduled as nearas possible to the midpoint ofan employee’swork period. Also, section 7.7 does not explain when employees can take meal breaks.19 ButWAC 296-126- 092(2) requires that “[nb employee shall be required to work more than five consecutive hours without a meal period.” As section 7.7 states, administration of the CBA necessarily relies on compliance with the regulation ratherthan the CBA varying from orsuperseding the regulation.

16 CP at 93.
17 CP at 93.
18 Compare CP at 93 (section 7.7 ofthe CBA), with WAC 296-126-092.
19Throughout its briefing and at oral argument, Evergreen repeatedly claimed thatthe CBA provides only one meal break per 12-hour shift. Butthis is misleading. The section ofthe CBA Evergreen cites to forthis fact is an addendum to the CBA applicable onlyto nurses working a “combined shift schedule” with both eight and 12-hour shifts. CP at 198. Generally, though, nurses working 12-hour shiftswould workthree 12-hour shifts within a seven day period. Because Lee and McFarland onlyworked 12-hourshifts, the combined shift schedulewould not have applied to them. Instead, section 7.7, ratherthan the addendum, governed their meal and rest breaks.

7No. 77694-1-1/8
Evergreen makes much ofthe factthat section 7.7 provides fora 15-minute rest period, whereas WAC 296-126-092(4) provides fora rest period of“no less than ten minutes.”20 But 15 minutes is “no less than ten minutes.” The 15-minute rest period merely reflects compliance with ratherthan variance from the regulation. Also, Lee’s claim is for missed rest breaks. The potential duration ofa rest break is irrelevant ifthe break never begins orwas less than 10 minutes. Evergreen also relies on deposition testimonyfrom McFarland and other class members to argue Lee’s claims are contractual ratherthan statutory. But arguable differences between class claims pled in the complaint and snippets of plaintiffs’ testimonydo not recast Lee’s claims as Evergreen wants them to be.21 Specifically, Evergreen contendsthat McFarland’s testimony about missed breaks

20 See, e.g., Appellant’s Br. at23-25 (‘The CBAgrants nurses 15-minute rest breaks, notthe 10 minutes provided byWAC 296-126-092(4).

. . . ~f nurses missed their 15-minute rest breaks and were not paid, that is a ‘breach ofthe express terms and conditions’ ofthe CBA and must be resolved through the CBA’s grievance process, culminating in arbitration.”). 21 Evergreen points to CR 15(b) and related cases as authorityfor its contention. But neither CR 15 northe cases Evergreen cites apply here. “CR 15(b) is applicable in general terms to those occasions when the course ofthe trial departs so materiallyfrom the image ofthe controversy pictured in the pleadings that it becomes necessaryto adjust the pleadings to reflectthe case as itwas actually litigated in the courtroom.” Harding v. Will, 81 Wn.2d 132, 136, 500 P.2d 91(1972). “Where evidence raising issues beyond the scope ofthe pleadings is admitted without objection, the pleadingswill be deemed amended to conform to the proof.” Reicheltv. Johns-Manville Corp., 107 Wn.2d 761, 766-67, 733 P.2d 530 (1987). CR 15(b) is not an invitation to recast one party’s claims at the behest ofthe opposing party based on highly disputed characterizations of cherry-picked deposition testimony.

8No. 77694-1-1/9

shows herclaims arise underthe CBA,22 butthe rest and meal breaks provided by the CBA accord with state law.23 And Lee’s complaint alleges Evergreen failed to provide any rest breaks regardless ofeach break’s duration. Neitherthe CBA nor plaintiffs’ testimonyconverts this statutory claim into a contractual one. Evergreen contends that all disputes between parties to a CBA are presumptivelysubjectto arbitration unless specifically excluded. This argument is not persuasive because itfails to recognize the source ofthe rights Lee asserts in hercomplaint. The “Steelworkers Trilogy,”24which sets outthe principles governing arbitration of public employee labordisputes governed by a CBA, stronglyfavors

22 ~ Appellant’s Br. at 14-16 (“I think ifthe union contract states that they’re required to give you a rest breakwithin a certain period oftime, then ifthey do not giveyou that, they oughtto payyou for it, yes.”) (quoting CP at 589-90).

23 Evergreen also relies on testimonyfrom a single class memberto argue Lee’s claims rely on the “CBA’s ten-minute continuous and 15-minute total standards” for rest breaks. Appellant’s Br. at24. But Lee’s expectation ofa continuous 10-minute break does not originate in the CBA. WAC 296-126-092(4) requires a rest break ofat least 10 minutes, whileWAC 296-126-092(5) merely allows forshort, intermittent breaks overfour hours to add up to a single 10-minute break. Whethersome nurses take advantage ofWAC 296-126-092(5) is a question germane to class certification and damages, neitherofwhich are before us. Also, this argument admits that nurses can satisfythe break requirement in their CBA bytotaling theirshort breaks overfour hours even though this procedure is available onlythrough WAC 296-1 26-092(5) and not section 7.7 ofthe CBA. It shows the CBA being administered bythe regulation ratherthan superseding it. 245~ United Steelworkers v. Am. Mfq. Co., 363 U.S. 564, 80 S. Ct. 1343, 4 L. Ed. 2d 1403 (1960); United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 5. Ct. 1347, 4 L. Ed. 2d 1409 (1960); United Steelworkers v. Enter. Wheel & Car Corp., 363 U.S. 593, 80 S. Ct. 1358, 4 L. Ed. 2d 1424 (1960).

9No. 77694-1 -1/10

arbitration ofcontractual disputeswithin the scope ofan arbitration provision.25 But a public or private employee’s statutory rights are distinctfrom her contractual rights.26 Even where a CBA contains a provision that is coextensivewith a statutory right, the ultimate question is whatthe law requires; “and that is not a question which should be presumedto be included within the arbitration requirement.”27 Moreover, arbitration clauses in CBAs differfrom arbitration clauses in bilateral employment contracts, particularlywhen it comes to statutory rights.28 Consequently, an employee retains the abilityto enforce herstatutory rights in court unless the employees clearly and expressly agreed in the CBAto arbitrate theirstatutory claims.29 The CBA must “explicitly state[j” in “clearand

255~ RCW41 .56.122(2) (“A collective bargaining agreement may.

. (2) Provide for binding arbitration ofa labordispute arising from the application or interpretation ofthe matters contained/n a [CBA].”) (emphasis added); Mount Adams Sch. Dist. v. Cook, 150 Wn.2d 716,723,81 P.3d 111 (2003) (quoting Peninsula Sch. Dist., 130 Wn.2d at 413-14) (summarizing principles derived from the Steelworker’s Trilogy)).

26Vega v. New Forest Home Cemetery, LLC, 856 F.3d 1130, 1134 (7th Cir. 2017); Civil Serv. Comm’ of City of Kelso v. City of Kelso, 137 Wn.2d 166, 175, 969 P.2d 474 (1999); seeWrightv. Universal Mar. Serv. Corp., 525 U.S. 70, 78- 80, 119 S. Ct. 391, 142 L. Ed. 2d 361 (1998) (concluding thatthe presumption favoring arbitrability in the Steelworker’s Trilogywas inapplicable to a statutory claim). 27Wright, 525 U.S. at 79. 28~g~, Colev. Burns Int’l Sec. Servs., 105 F.3d 1465, 1473-79 (D.C. Cir. 1997) (discussing the historic background ofthe role ofarbitration and distinguishing contractual and statutory claims). 29 14 Penn Plaza LLC v. Pvett, 556 U.S. 247, 258-59, 264, 129 5. Ct. 1456, 173 L. Ed. 2d 398 (2009) (holding that employees subjectto a CBA must arbitrate statutory claims where the CBA’s “arbitration provision expresslycovers both

10No. 77694-1-I/il

unmistakable language” thatemployees waive theirabilityto enforce statutory rights in court.3° In Vega v. New Forest Home Cemetery, LLC, a union employee working undera CBAsued his formeremployerto collect unpaid wages.31 The employee brought claims underthe Fair LaborStandardsAct (FLSA)32 and Illinois state wage law.33 The CBA addressed the employee’s wages, set out a mandatory four-step grievance process to resolve disputes, and explicitly defined grievances to include disputes over pay.34 The court held the employee could sue in courtto enforce his statutorywage rights underthe FLSA because nothing in the CBA referenced the statute.35 Because the CBA did not explicitly referencethe FLSA, therewas nothing clear and unmistakable in the CBA compelling the employee to assert his statutory rights through the grievance process.36 statutory and contractual discrimination claims.”) (emphasis added); Wright, 525 U.S. at 79 (“[A]ny CBA requirementto arbitrate [a statutory claim] must be particularly clear.”). 30Vega, 856 F.3d at 1134 (citing 14 Penn Plaza, 556 U.S. at 258-59); Cox, 2 Wn. App. 2d at404; 

### ~f. Kelso, 137 Wn.2d at 177 (“[W]here the two appeal processes are concerned with different substantive rights, this courtwill not impose an election of remedies clause [in a CBA] where none was bargained for bythe parties.”). 31 856 F.3d 1130, 1131 (7th Cir. 2017). 32 29 U.S.C. 

### § 206(b). 33Vega, 856 F.3d at 1132. ki. at 1133. Notably, the mandatory grievance process in Vega authorized arbitration on the demand ofeitherthe union orthe employer. ki. at 1131 nI. 35k1.at 1135. 36 Id.

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Similarly, this court recently held in Coxv. Kroqer Co. that an arbitration provision in a union employee’s CBA did notwaive his abilityto bring statutory wage and hourclaims in court.37 The employee brought a class action against his formeremployerto collectwages allegedly denied in violation ofstate wage laws.38 Because neitherthe CBA’swage norgrievance provisions identified or even referenced anywage statutes covered bythe agreement, the CBA did not “clearly and unmistakably” waive his abilityto enforce his statutory rights in court.39 The court affirmed the trial court’s denial ofthe employer’s motion to compel arbitration.4° By contrast, the Supreme Court held in 14 Penn Plaza LLC v. Pyettthat a union employees’ CBAwaived theirabilityto enforce statutory rights in court.41 The employees alleged discrimination in violation ofthe federal Age Discrimination in EmploymentAct of 1967 (ADEA).42 Butthe employees’ CBA explicitly provided that all employmentdiscrimination claims, including those brought underthe ADEA, would be subjectto the contract’s grievance provision requiring binding arbitration “as the sole and exclusive remedyforviolations.”43 The court reasoned

372Wn. App. 2d 395, 405, 409 P.3d 1191 (2018). 38 kI. at 399-400. kI. at at 404-05. Id. at405 41 556 U.S. 247, 251-52, 129 S. Ct. 1456, 173 L. Ed. 2d 398 (2009).
42 29 U.S.C. 

### § 621. ki. at 251-52.

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the CBA “clearly and unmistakably” required arbitration because the discrimination section explicitly stated ADEA claimswere arbitrable.44 Here, as in Vega and Cox, article 16 makes no reference ofany kind to any statute orto statutory rights. In addition, article 16 narrowly defines a grievance as an “alleged breach ofthe express terms and conditions ofthe [CBA],”45which WAC 296-126-092 is not. And unlike 14 Penn Plaza, no part ofthe CBA explicitly waives Lee’s abilityto enforce herstatutory rights in court. Lee’s complaint alleges thatshe and herfellow class members “did not receive meal and rest breaks violat[ing] RCW49.12 and WAC 296~126~092.”46 The complaint does not reference breach ofany contractual term, and the face ofthe CBAshows it does not supersede orvaryfrom WAC 296-126-092.~~ Article 16 provides the option ofsubmitting unresolved grievances to binding arbitration, ratherthan mandating arbitration in all instances.48 And, as in
Id. at 260.

~ CP at 106. 46 CP at439.

~ We note that our Supreme Court has held that a CBA may not abrogate a worker’s rightto periodic rest periods underchapter49.12 RCW orWAC 296-1 96- 092, and the statute must “operate as a base” from which parties may negotiate a CBAthat “enhance[sj or exceed[s] those minimum standards.” Wingertv. Yellow Freight Sys., Inc., 146 Wn.2d 841, 852, 50 P.3d 256 (2002) (quoting Wingertv. Yellow Freight Sys., Inc., 104Wn. App. 583, 596, 13 P.3d 677 (2000)). Thus, variances are still actionable as statutory claims to the extentthe CBA abrogates an emergency room nurse’s abilityto enjoythe minimum rest and meal breaks guaranteed bythe statute. 48 CP at 107 (“Ifthe grievance is not settled on the basis ofthe foregoing procedures, [WSNA] maysubmitthe issue in writing to final and binding arbitration.”) (emphasis added).

13No. 77694-1-1114

~ the CBA’s grievance provisions make no mention ofany statutory rights and apply onlyto a breach ofthe agreement’s express terms. Lee’s complaintdoes not implicate the CBA and, moreover, the CBA does not clearly and unmistakably waive Lee’s abilityto bring individual statutory claims in court.49 Evergreen contends, though, 14 Penn Plaza, Vega, and ~ç~ç are inapposite because those employees were privately employed whereas Lee was a public employee with a CBA subjectto Washington’s Public Employee Collective Bargaining Act (PECBA).5° According to Evergreen, PECBA presumes that an employee’s disputes with her public employer are subjectto arbitration absent “a clearand unmistakable carve-out” because PECBA “provides an express waiver ofajudicial forum foremployee statutory claims on matters covered in the CBA.”51 First, PECBA does not presume or mandate arbitration ofemployees’ statutory claims. PECBA merely allows that a CBA “may.

. . [pjrovide for binding arbitration ofa labordispute” arising from “matters contained in” the agreement.52 The parties to a CBA are free to collectively bargain for particulardispute resolution procedures. PECBA mandates neitherarbitration nor litigation. And, as discussed, Lee’s statutory claims do not arise from “matters contained in” the CBA.

~ 14 Penn Plaza, 556 

## u.s. 258-59; Wright, 525 U.S. at79; Cox, 2 Wn. App. 2d at404.

50 Ch. 41.56 RCW.
51 Appellant’s Supp. Br. at 5-6.
52 RCW41 .56.122(2).

14No. 77694-1 -1115
Second, our Supreme Court recognized in Peninsula School District No. 401 v. Public School Employees of Peninsula that PECBA is not implicated where only“statutorily created private rights” are allegedly harmed by an employer’s conduct.53 In Peninsula, a school districtdeclined to recognize a grievancefiled jointly by a union and its member because the district argued the mattergrieved fell outside the bounds ofthe CBA.54 Thus, the court had to address whetherthe mattercould be and was collectively bargained for.55 The Peninsula court distinguished that case from Shoreline Community Collecie District No. 7 v. Employment Security Department56 because Peninsula did not involve a waiverof private statutory rights.57 In Shoreline, the community college argued that an English instructorwas notentitled to unemployment benefits because his CBA calculated his work hours such that he could not meetthe statutory minimum to receive benefits.58 The community collegefurther contended the CBA controlled over conflicting provisions ofthe Employment SecurityAct,59 effectivelywaiving the instructor’s rightto receive unemployment benefits.6° The court disagreed and held that a
~~130 Wn.2d 401, 412, 924 P.2d 13(1996).

~ kzl. at403-05. 55kLat409. 56120 Wn.2d 394, 842 P.2d 938 (1992). ~~130 Wn.2d at412. 58120Wn.2d at401-02.

~ Oh. 50.04 RCW. 60120 Wn.2d at401-02.

15No. 77694-1-1116

contractual waiverofthe rightto unemployment benefits was void as contraryto public policy because the rightto benefits serves a public policy purpose; the court’s analysis never considered PECBA.61 Because the CBA does not clearly and unmistakablywaive Lee’s abilityto enforce herstatutory rights in court and PECBA is not germane, the court did not
err in denying Evergreen’s motion to compel arbitration.62

61 j~ at410. We also note that PECBA’s stated purpose isto provide “‘a uniform basisfor implementing the right of public employees tojoin

... and to be represented by [labor] organizations in matters concerning their employment.” Peninsula, 130 Wn.2d at406-07 (quoting RCW41.56.010). And cases cited by Evergreen implicating PECBA all involve infringements on a union’s abilityto represent its members. Peninsula, 130 Wn.2d at403-04, 407 (school district refused to complywith CBA and enterarbitration afterthe union filed a grievance in conjunction with a terminated employee); Municipality of Metro. Seattle v. Pub. Emp’t Relations Comm’n, 118 Wn.2d 621, 624, 631-34, 826 P.2d 158 (1992) (employer refused to complywith an orderfrom the Public Employment Relations Commission mandating arbitration to advance the collective bargaining process between it and a union); Rose v. Erickson, 106 Wn.2d 420, 421-22, 721 P.2d 969 (1986) (employer refused to recognize a union employee’s grievance filed pursuantto terms ofthe CBA); NucleonicsAll., Local Union No. 1-369, Oil, Chem. &AtomicWorkers Int’l Union, AFL-CIO v. Washington Pub. Power Supply Sys. (WPPSS), 101 Wn.2d 24, 25-27, 677 P.2d 108 (1984) (union soughtto represent nonunion employees and employeropposed its efforts); SEIU 775 v. State Dep’t of Soc. & Health Servs., 198 Wn. App. 745, 396 P.3d 369 (holding that PECBA does not prohibita public employer’s release ofemployees’ nameswhere the employees’ union intervened to enjoin release of members’ names underthe Public RecordsAct), review denied, 189 Wn.2d 1011(2017); The Council of County. & City Employees, AFSCME, AFL-CIO v. Spokane County, 32 Wn. App. 422, 647 P.2d 1058 (1982) (employer refused to recognize and arbitrate a grievance filed pursuantto CBAwith the union). Here, by contrast, Evergreen’s conduct implicates only private statutory rights and not collective bargaining rights. As in Shoreline Community College, PECBA does not appearto be germane to this litigation.

62 Vega, 856 F.3d at 1134; ~ 2 Wn. App. 2d at404. Evergreen has moved to strike portions of Lee’s supplemental briefing, which she and Evergreen both filed at our request. First, Evergreen’s motion to strike relied exclusively on

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Whether Evergreen Waived The RightTo Compel Arbitration Lee contends that even ifthe CBA required arbitration of herclaims, Evergreen waived its rightto compel arbitration. We reviewde novo whethera partywaived arbitration.63 “Washington courts have long held thatthe contractual rightto arbitration may be waived if it is nottimely invoked.”64 Because Washington has a strong presumption in favorofarbitration, the party arguing against it bears a heavy burden ofshowing thatwaiveroccurred.65 “‘To establish waiver ofthe rightto arbitration, the party opposing arbitration must demonstrate (1) knowledge ofan existing rightto compel arbitration; (2) acts inconsistentwith that existing right; and (3) prejudice to the party opposing arbitration resulting from such inconsistent acts.”66 A party asserting its rightto arbitration acts inconsistentlywith that right where it seeks a decision on the merits of issues in the litigation67 and fails to

materials outside the appellate record in violation of RAP 17.3(a). Second, Evergreen moved to strike onlythose portions of Lee’s supplemental briefarguing that herclaims are based solely on statutes, but a motion to strike is notthe appropriate vehicleforarguments on the merits ofan appeal. We denythe motion. 63 Estate of Romney, 199 Wn. App. at602. 64 Otis Hous. Ass’n, Inc. v. Ha, 165 Wn.2d 582, 587, 201 P.3d 309 (2009). 65 Estate of Romney, 199 Wn. App. at 602. 66 kI. at 601-02 (internal quotation marks omitted) (quoting Wiese, 189 Wn. App. at480).

67 Martin, 829 F.3d at 1125; Petroleum Pipe Ams. Corp. v. Jindal Saw, Ltd., 575 F.3d 476, 480 (5th Cir. 2009); see Otis Housing Ass’n, 165 Wn.2d at 588, (litigating a parallel action before invoking rightto arbitrate in a separate action on same merits waives the right); Naches Valley Sch. Dist. No. JT3 v. Cruzen, 54 Wn.

17No. 77694-1 -1/18

assert its right at “‘obvious opportunities” to do so.68 “Simply put,

. . . a party waives a rightto arbitrate if it elects to litigate instead ofarbitrate.’69 Evergreen agrees it did not move to compel arbitration until the parties had been litigating for nine months.7° But it contends it did not knowthe claims in the complaint arose underthe CBA until after it deposed McFarland on July 26, 2017, and Lee added McFarland as a representative plaintiffafewweeks later.71 Lee’s meal and rest break claims against Evergreen in hersecond amended complaintare identical to those in herfirst amended complaint and her original complaint.72 Also, Evergreen first raised arbitration as a defense in the

App. 388, 395-96, 775 P.2d 960 (1989) (plaintiffs waived arbitration byfiling for summaryjudgment on the merits oftheir claims). 68 Hill v. Garda CL Nw. Inc., 169 Wn. App. 685, 692, 281 P.3d 334 (2012) (quoting Steele v. Lundgren, 85 Wn. App. 845, 853-55, 935 P.2d 671 (1997)), rev’d on othergrounds, 179 Wn.2d 47, 308 P.3d 635 (2013). 69 Otis Hous. Ass’n,, 165 Wn.2d at 588. 70 SeeAppellant’s Br. at28-29 (Evergreen’s “motion to compel arbitration was filed 15 days afterthe [c]ourt granted the motion to amend and plaintiffs filed the [s]econd [a]mended [c]omplaint.”).

71 See k1. at 29-30 (“The combination of McFarland’s deposition testimony, which was given before plaintiffs soughtto amend the complaint, and the [s]econd [a]mended [c]omplaint made clearthatthe claims in this lawsuit arise underthe CBA and require an interpretation ofthe CBA’s express terms and past practices ofthe parties.”). 72 Compare CP at439 (section VI ofsecond amended complaint stating claims against Evergreen: “Defendant’s practices underwhich Plaintiffs and the class did not receive meal and rest breaks violate RCW49.12 and WAC 296-126- 092.”), with CP at 5, 17 (section VI ofcomplaint and first amended complaint stating claims against Evergreen: “Defendant’s practices underwhich Plaintiffand the class did not receive meal and rest breaks violate RCW49.12 and WAC 296- 126-092.”).

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answer itfiled December22, 2016.~~ Evergreen cannot now contend it did not knowthese claims might be arbitrable where its answer raised arbitration as an affirmative defense. Evergreen behaved inconsistentlywith a party seeking to arbitrate. Soon after McFarland’s deposition, Lee moved to continue trial from November2017 to March 2018. Lee also sent Evergreen a copy of her proposed second amended complaint adding McFarland as a representative plaintiff. Evergreen opposed the motion to continue, and stated it “is prepared to trythis case on November6, 2O17.”~~ Also, Evergreen was fully aware of McFarland’s deposition testimony at the time it insisted on litigating. Evergreen specifically argued against granting Lee a continuance because McFarland had already been deposed and “[a] second class representative adds nothing to the present case.”75 Put simply, Evergreen elected to litigate and missed an obvious opportunityto assert its rightto arbitrate. Lee would be prejudiced by granting Evergreen’s motion to compel. “When
a party has expended considerable time and moneydue to the opposing party’s failure to timely move forarbitration and is then deprived ofthe benefits forwhich it has paid by a belated motion to compel, the party is indeed prejudiced.”76 For example, there is prejudice when a party loses a motion on the merits and

~ CP at 10.

~ CP at 1793.

~ CP at 1798. 76 Martin, 829 F.3d at 1127.

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effectively attempts to relitigate it by invoking arbitration77 orwhen a party “too long postpones” invocation of arbitration and causes the opposing party ‘to incur unnecessarydelayorexpense.”78 Here, Lee will be prejudiced if Evergreen is allowed to belatedly compel arbitration. Lee asserts she incurred over$140,000 in fees and costs from formal discovery and pretrial litigation before Evergreen moved to compel arbitration. Granting Evergreen’s motion would also prejudice Lee by giving Evergreen a second chance on the critical substantive issues, such as class certification, that it litigated and lost.79 Evergreen analogizes to Hill v. Garda CL Northwest Inc. to argue it did not waive its rightto compel arbitration.8° In Hill, a group ofemployees filed a putative class action against an armored car companyfor alleged wage violations.81 The

‘~ Steele, 85 Wn. App. at 859.
78 Schusterv. Presticie Senior Mcjmt., LLC, 193 Wn. App. 616, 643, 376 P.3d 412 (2016); Steele, 85 Wn. App. at 859. Evergreen argues that its motion to compel arbitration was not belated because it occurred onlytwo weeks afterthe court approved Lee’s second amended complaint. Butthis ignores the preceding nine months of litigation during which Evergreen knew it could arbitrate, and it attemptsto elevate chronology over conduct.

~ Steele, 85 Wn. App. at 859; see Martin, 829 F.3d at 1128 (holding the defendantwaived arbitration “because the plaintiffs would be prejudiced ifthe defendants got a mulligan on a legal issue it chose to litigate in court and lost”); Riverside Publ’q Co. v. Mercer Publ’q LLC, 829 F. Supp. 2d 1017, 1021-23 (W.D. Wash. 2011) (finding prejudice from the plaintiff’s “forum shopping” when it belatedly moved to compel arbitration only after losing substantive pretrial motions).

80 169 Wn. App. 685, 691-94, 281 P.3d 334 (2012).
81 kI.at 688.

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companyasserted its right to compel arbitration in its answerand began to engage in discovery, but it did not moveto compel arbitration foroverone year.82 But during thatyear, the parties agreed to delay litigation while awaiting the outcome in a very similarcase83 being litigated in this court.84 Afterthe similarcase was decided, the parties filed ajoint stipulation agreeing thatthe matterwas arbitrable.85 Also, both parties endeavored to resolve the dispute through mediation priorto committing to arbitration or litigation.86 Afterthe companyfinally moved to compel arbitration, this court held it had notwaived the rightto arbitrate “[b]ecause the delay in filing the motion to compel resulted in partfrom an effortto resolve this case without resorting to litigation and Garda asserted its arbitration rights in its answer.”87 Evergreen’s conduct in this case bears little similarityto that ofthe armored
car company. Unlike the company in Hill, Evergreen demanded to litigate this
case in court before seeking arbitration. Also, nothing in the appellate record shows an effort by either partyto resolve this dispute out ofcourt. Evergreen’s knowledge of its abilityto invoke arbitration, its litigation conduct, and the potential prejudiceto Lee demonstratewaiver ofthe rightto

82 Id. at 688-89, 691. 83 Pellino v. Brink’s Inc., 164 Wn. App. 668, 267 P.3d 383 (2011). 84[.jjfl, 169 Wn. App. at 691. 85 Id. 86kLat692. 87 Id.

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arbitrate. Accordingly, we conclude Evergreen waived the rightto arbitratewhen it elected to litigate instead ofarbitrate.88 Forthe foregoing reasons, we affirm.

AL)! WE CONCUR: 

# 0

88 Otis Hous. Ass’n, 165 Wn.2d at 588.

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