Court Opinion

ID: 3163259
Source: CourtListenerOpinion
Date Created: 2015-12-16 20:03:24.170495+00
Date Added: 2024-06-11T15:26:30.667849
License: Public Domain

Filed 12/16/15
                           CERTIFIED FOR PUBLICATION

             IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                             FIRST APPELLATE DISTRICT

                                     DIVISION ONE

M. TODD JENKS,
        Plaintiff and Appellant,
                                                   A143990
v.
DLA PIPER RUDNICK GRAY CARY US                     (San Francisco County
LLP,                                               Super. Ct. No. CGC-09-493491)
        Defendant and Respondent.

        After plaintiff M. Todd Jenks resigned from his position as an associate attorney,
he sued his employer, defendant DLA Piper Rudnick Gray Cary US LLP (DLA Piper),
alleging the law firm had violated the terms of his resignation agreement by preventing
him from receiving certain disability benefits. DLA Piper successfully moved to compel
arbitration as the successor by merger to an arbitration agreement entered into between
plaintiff and his prior employer. After the arbitration was completed, the trial court
granted DLA Piper’s motion to confirm the award. Plaintiff appeals from the trial court’s
order affirming the award and denying his motion for new trial, contending the court
erred in concluding his claims were subject to arbitration. We affirm.
             FACTUAL BACKGROUND AND PROCEDURAL HISTORY
        On May 8, 2000, the law firm Gray Cary Ware & Friedenrich (Gray Cary) sent
plaintiff a letter offering him employment as an associate attorney with the firm (Offer
Letter). The Offer Letter included a provision requiring both parties to submit all
disputes or claims relating to or arising out of their employment relationship to binding
arbitration.1
       On May 12, 2000, plaintiff accepted Gray Cary’s offer.
       On January 1, 2005, Gray Cary merged into DLA Piper.
       On February 19, 2006, plaintiff signed a “Confidential Resignation Agreement and
General Release of Claims” (Termination Agreement). Under the Termination
Agreement, DLA Piper agreed to “continue to provide [plaintiff] with insurance coverage
and other benefits, insurance and otherwise, currently provided by the Firm to [him]”
until August 2006, when his employment with DLA Piper would officially terminate.
The Termination Agreement is silent with respect to dispute resolution.
       In October 2006, DLA Piper published a document entitled, “Wraparound Plan
Document and Summary Plan Description for the Piper Rudnick LLP Welfare Benefit
Plan” (Wraparound Plan).
       On October 16, 2009, plaintiff filed a complaint against DLA Piper and Standard
Insurance Company2 alleging four causes of action: (1) breach of the implied covenant of
good faith and fair dealing, (2) breach of contract, (3) promissory fraud, and
(4) constructive fraud. Plaintiff contended that while the Termination Agreement
obligated DLA Piper to provide him with short-term disability (STD) benefits, the firm

1
  The arbitration provision states: “In the event of any dispute or claim relating to or
arising out of our employment relationship or this agreement (including, but not limited
to, any claims of breach of contract, wrongful termination or age, sex, race or other
discrimination or harassment under any state or federal statute or common law), you and
the Firm agree that all such disputes shall be fully and finally resolved by binding
arbitration conducted by the American Arbitration Association (‘AAA’) in Santa Clara
County, California in accordance with the AAA’s National Rules for the Resolution of
Employment Disputes. We specifically agree that an arbitrator may be appointed under
an expedited process and shall have full authority to order injunctive relief. The Firm
will pay any fees charged by an artibrator to hear this matter, as well as any other fees
that would not customarily be borne by you in the event any dispute were litigated in
court. By this agreement you understand and acknowledge that you and the Firm are
each waiving the right to a judicial forum, including the right to a jury trial.”
2
 Standard Insurance Company was subsequently dismissed from this action with
prejudice in November 2011.

                                             2
had “undervalued” his benefits by computing them based on “artificially reduced salary
figures.”
       On March 11, 2010, DLA Piper filed a petition to compel arbitration.
       On March 23, 2010, plaintiff filed his opposition to the petition. In his opposition,
he asserted the Termination Agreement constituted a novation of the Offer Letter, thereby
extinguishing the arbitration provision. He also argued that even if the arbitration
provision had survived, claims involving the STD plan were not subject to arbitration.
       On May 13, 2010, the trial court entered its order granting defendant’s petition to
compel arbitration. The court found the Termination Agreement was a separate
agreement applying to issues of termination only, and that it did not supersede the
arbitration agreement contained in the Offer Letter. The court also found all of plaintiff’s
claims were subject to arbitration. Judicial proceedings were stayed pending resolution
of arbitration.
       On July 7, 2010, plaintiff filed a first amended complaint (FAC) in the arbitration
proceeding, alleging eight causes of action.3
       On August 22, 2013, after 11 hearing days of arbitration, the arbitrator issued an
award. The arbitrator determined DLA Piper had breached the Termination Agreement,
finding plaintiff was entitled to compensatory damages for STD payments of which he
was deprived as a result of the reduced salary figure used to compute his benefits. The
arbitrator also concluded plaintiff had suffered some degree of emotional distress caused
by DLA Piper’s conduct. The arbitrator awarded $41,000 in contract damages plus
interest from the date of the breach, and $45,000 in emotional distress damages. Plaintiff
was awarded $7,535.67 in costs. All his other claims were denied.
       On November 20, 2013, plaintiff filed a petition in federal district court to confirm
in part, vacate in part, and/or modify the arbitration award.

3
 In addition to repeating the causes of action from his complaint, the FAC includes two
causes of action against DLA Piper that invoke his rights under ERISA.

                                                3
         On December 10, 2013, DLA Piper filed a petition in state court to confirm the
arbitration award.
         On December 11, 2013, DLA Piper filed a petition in federal district court to
dismiss plaintiff’s petition.
         On December 31, 2013, plaintiff filed a demurrer to DLA Piper’s state court
petition to confirm the arbitration award.
         On February 4, 2014, the trial court filed its order granting DLA Piper’s petition to
confirm the arbitration award. The court overruled plaintiff’s demurrer, and denied a
motion for an order staying the proceedings.
         On May 14, 2014, the trial court filed its statement of decision confirming the
arbitration award. The court first found it lacked jurisdiction to vacate the arbitration
award, because plaintiff’s opposition was untimely filed. The court also concluded
plaintiff had forfeited his argument that DLA Piper, as a nonsignatory, lacked standing to
enforce the Offer Letter’s arbitration agreement, observing that even if the argument was
not forfeited, it failed on its merits because DLA Piper had succeeded to Gray Cary’s
contractual rights.
         On June 26, 2014, plaintiff filed objections to the proposed judgment.
         On July 10, 2014, the district court dismissed plaintiff’s federal petition for lack of
federal jurisdiction. (Jenks v. DLA Piper (US) LLP (N.D. Cal. July 10, 2014, 13-CV-
05381-VC) 2014 U.S. DIST. LEXIS 94680.)
         On August 26, 2014, the trial court filed an amended judgment. In conformity
with the arbitration award, judgment was entered in favor of plaintiff in the sum of
$120,112, plus $12,142 in postaward interest. He was also awarded costs.
         On September 22, 2014, plaintiff filed a motion for a new trial.
         On November 20, 2014, the trial court filed its order denying the motion for a new
trial.
         On December 24, 2014, plaintiff filed a notice of appeal from the judgment and
the order denying the motion for a new trial.

                                                4
                                      DISCUSSION
I.     Standards of Review
       An order granting a petition to compel arbitration is not appealable, but is
reviewable on appeal from a subsequent judgment on the award. (Code Civ. Proc.,
§§ 1294, 1294.2; Abramson v. Juniper Networks, Inc. (2004) 115 Cal.App.4th 638, 648–
649.) “We review the trial court’s interpretation of an arbitration agreement de novo
when, as here, that interpretation does not depend on conflicting extrinsic evidence.
[Citations.] Our de novo review includes the legal determination whether and to what
extent nonsignatories to an arbitration agreement can enforce the arbitration clause.”
(DMS Services, LLC v. Superior Court (2012) 205 Cal.App.4th 1346, 1352 (DMS).)
       An order denying a motion for new trial will not be set aside unless there was an
abuse of discretion that resulted in prejudicial error. (City of Los Angeles v. Decker
(1977) 18 Cal.3d 860, 871–872.)
II.    Enforceability of the Arbitration Agreement
       A. General Principles
       “A written agreement to submit to arbitration an existing controversy or a
controversy thereafter arising is valid, enforceable and irrevocable, save upon such
grounds as exist for the revocation of any contract.” (Code Civ. Proc., § 1281.) A party
seeking to compel arbitration of a dispute “bears the burden of proving the existence of
an arbitration agreement, and the party opposing arbitration bears the burden of proving
any defense, such as unconscionability.” (Pinnacle Museum Tower Assn. v. Pinnacle
Market Development (US), LLC (2012) 55 Cal.4th 223, 236.)
       “Code of Civil Procedure section 1281.2[4] allows a party to an arbitration
agreement to petition to compel arbitration. By stating that a party to an arbitration

4
 Code of Civil Procedure section 1281.2 provides, in part: “On petition of a party to an
arbitration agreement alleging the existence of a written agreement to arbitrate a
controversy and that a party thereto refuses to arbitrate such controversy, the court shall
order the petitioner and the respondent to arbitrate the controversy if it determines that an
agreement to arbitrate the controversy exists . . . .”

                                              5
agreement may petition to compel arbitration, the statute assumes that a proceeding to
compel arbitration will be between the signatories to the agreement.” (Marenco v.
DirecTV LLC (2015) 233 Cal.App.4th 1409, 1416 (Marenco).)
       “Nonsignatory defendants may enforce arbitration agreements ‘where there is
sufficient identity of parties.’ [Citation.] Enforcement is permitted where the
nonsignatory is the agent for a party to the arbitration agreement [citations], or the
nonsignatory is a third party beneficiary of the agreement [citation]. In addition, a
nonsignatory may enforce an arbitration agreement under the doctrine of equitable
estoppel. The doctrine applies where, for example, a signatory plaintiff sues a
nonsignatory defendant for claims that are based on an underlying contract. In such
instance, the plaintiff may be equitably estopped to deny the nonsignatory defendant’s
right to enforce an arbitration clause that is contained within the contract that the plaintiff
has placed at issue.” (Marenco, supra, 233 Cal.App.4th at p. 1417.)
       On appeal, plaintiff renews his argument that DLA Piper did not have standing to
enforce the arbitration agreement because the firm was not a signatory to the Offer Letter
containing the arbitration provision.
       B. Plaintiff’s Nonsignatory Argument is Forfeited
       We agree with DLA Piper that plaintiff forfeited his nonsignatory argument by
failing to raise it below in opposition to the petition to compel arbitration. Although
plaintiff resisted the petition to compel, he did so on the ground that the Termination
Agreement extinguished the arbitration agreement because it operated as a novation of
the Offer Letter. He also contended that under the Wraparound Plan, disputes relating to
STD benefits were to be resolved by litigation in state or federal court. He did not make
any arguments based on DLA Piper’s status as a nonsignatory to the arbitration
agreement, even though this circumstance is apparent on the face of the Offer Letter. Nor
did he raise this issue at any point during the arbitration proceeding, even though he
reserved the issue of arbitrability in his FAC. We therefore conclude plaintiff has
forfeited this argument. (See, e.g., Cummings v. Future Nissan (2005) 128 Cal.App.4th
321, 328–329 [party to arbitration agreement is generally obliged to raise

                                               6
unconscionability issues in court at the time she initially resists arbitration]; see also
Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 30–31 [a party contending the entire
arbitration agreement is unlawful generally must raise the issue at the outset in the trial
court].)
       C. DLA Piper Had Standing to Enforce the Arbitration Agreement
           1. Marenco Defeats Plaintiff’s Nonsignatory Argument
       Even if we were to find plaintiff’s nonsignatory argument has not been forfeited,
his contention fails on the merits. As noted above, that DLA Piper is not a signatory to
the Offer Letter is not, standing alone, a ground to deny it the right to compel arbitration:
“There are circumstances in which nonsignatories to an agreement containing an
arbitration clause can be compelled to arbitrate under that agreement. As one authority
has stated, there are six theories by which a nonsignatory may be bound to arbitrate:
‘(a) incorporation by reference; (b) assumption; (c) agency; (d) veil-piercing or alter ego;
(e) estoppel; and (f) third-party beneficiary’ ” (Suh v. Superior Court (2010)
181 Cal.App.4th 1504, 1513.)5 “These exceptions to the general rule that one must be a
party to an arbitration agreement to invoke it or be bound by it ‘generally are based on
the existence of a relationship between the nonsignatory and the signatory, such as
principal and agent or employer and employee, where a sufficient “identity of interest”
exists between them.’ ” (DMS, supra, 205 Cal.App.4th at p. 1353.)
       Marenco is dispositive of plaintiff’s argument. In that case, 180 Connect had
entered into an employment arbitration agreement with the plaintiff employee. DirecTV
later acquired 180 Connect and retained its employees, including the plaintiff. (Marenco,
supra, 233 Cal.App.4th at pp. 1412–1413.) After he filed a class action alleging
violations of state wage and unfair competition laws, DirecTV moved to compel
arbitration. (Id. at p. 1414.) In support of its motion, the company submitted the
declaration of its assistant secretary who attested that during the acquisition of 180

5
 These circumstances also serve as grounds for an eligible nonsignatory to enforce an
arbitration agreement against a signatory. (See DMS, supra, 205 Cal.App.4th at p. 1353.)

                                               7
Connect, DirecTV had assumed all of 180 Connect’s rights and obligations, including
those arising from 180 Connect’s employment relationships.6 The plaintiff opposed the
motion to compel, arguing that as a nonsignatory DirecTV lacked standing to enforce the
arbitration agreement. The trial court concluded DirecTV did have standing because it
was the successor to 180 Connect’s rights and obligations. (Ibid.)
       On appeal, the plaintiff again asserted DirecTV did not have standing to enforce
the arbitration agreement. (Marenco, supra, 233 Cal.App.4th at p. 1416.) Noting it was
an issue of first impression, the appellate court framed the inquiry as “whether a
nonsignatory defendant may enforce an arbitration agreement between a signatory
plaintiff and a corporation that was acquired by the nonsignatory defendant, which
assumed all of the rights and obligations of the acquired corporation.” (Id. at p. 1417.)
The court concluded that “[b]y suing DirecTV for unpaid wages, Marenco acknowledged
the existence of an employment relationship with the entity that survived the merger,”
thereby entitling the company to invoke the arbitration clause. (Id. at p. 1419.) The court
also relied on the following passage from Boucher v. Alliance Title Co., Inc. (2005)
127 Cal.App.4th 262, 271–272, which we find instructive: “ ‘[U]nder both federal and
California decisional authority, a nonsignatory defendant may invoke an arbitration
clause to compel a signatory plaintiff to arbitrate its claims when the causes of action
against the nonsignatory are “intimately founded in and intertwined” with the underlying
contract obligations. [Citations.] By relying on contract terms in a claim against a

6
  Like the plaintiff in Marenco, supra, 233 Cal.App.4th at pp. 1418–1419, plaintiff
challenges the sufficiency of the evidence regarding the merger that DLA Piper supplied
in support of its petition to compel arbitration. DLA Piper human resources employee
Lisa Partridge had signed a declaration stating that “[o]n January 1, 2005, the firm (which
was formerly known as Gray Cary Ware & Friedenrich LLP) merged into DLA Piper.”
Plaintiff claims this evidence is insufficient and criticizes DLA Piper for failing to
produce further evidence documenting the merger until shortly before the arbitration
hearing was set to commence. He did not raise this evidentiary challenge below when he
opposed the petition to compel arbitration, so the challenge is forfeited. Further, he
acknowledges that prior to the arbitration hearing, DLA Piper produced the law firms’
Plan of Affiliation, which formalized the merger.

                                             8
nonsignatory defendant, even if not exclusively, a plaintiff may be equitably estopped
from repudiating the arbitration clause contained in that agreement.’ ” (Marenco, at
pp. 1419–1420, italics added.) Based on the record and the parties’ arguments, the court
concluded the plaintiff’s “continued employment with DirecTV served as his implied
consent to preserving the original terms of employment, including the arbitration
agreement.”7 (Id. at p. 1420.)
       Plaintiff next claims the arbitration agreement is expressly limited to matters
arising out of his employment relationship with Gray Cary because every reference to
“the Firm” is intended as a reference to the former law firm, and the agreement does not
mention any potential successors, assignors, or merger partners. He asserts “no
reasonable construction of the 2000 Offer Letter supports the trial court’s ruling that the
Gray Cary contract controlled DLA Piper’s post-merger contracts and conduct.”
However, in Marenco the court ordered arbitration of claims relating to post-merger
conduct by the acquiring company. (Marenco, supra, 233 Cal.App.4th at p. 1422.) The
lawsuit was brought against the successor DirecTV based on its practice of issuing debit
cards that effectively deprived the plaintiff of wages he was entitled to under Labor Code
section 212. (Marenco, at p. 1414 [“In the operative pleading . . ., he alleged that
DirecTV had issued ‘ADP TotalPay debit cards’ . . . in payment of wages to the putative
class of employee plaintiffs. . . . These . . . resulted in DirecTV’s failure to pay plaintiffs’
full wages . . . .”].)8 Accordingly, plaintiff’s argument is not persuasive.

7
  We note plaintiff himself acknowledged the continuous nature of his employment
relationship in his complaint: “Beginning in 2000, [plaintiff] worked as an associate
attorney for the law firm of Gray Cary Ware & Friedenrich; [plaintiff] later became an
employee of DLA Piper as a consequence of a 2005 merger.”
8
 In his reply brief, for the first time, and at oral argument, plaintiff attempted to
distinguish Marenco, supra, 233 Cal.App.4th 1409, asserting the challenged practice was
actually initiated by the predecessor corporation 180 Connect, with whom plaintiff had an
arbitration arrangement. Hence, he claims that case applies only where the wrongful
conduct is initiated by the original employer. He purports to rely on a “letter brief”
submitted by Marenco’s attorney in that case. However, the opinion itself references the
conduct of DirecTV only in describing the allegations of the complaint. Additionally, the

                                               9
          2. DLA Piper Succeeded To Gray Cary’s Contract Rights
       Plaintiff further argues that surviving entities under California and Maryland
corporate merger law do not acquire the “underlying terms and conditions of those
employment relationships” that were negotiated by the disappearing entity. He claims
the surviving entity only succeeds to “ ‘the rights and property’ ” of its predecessor, and
contends that a successor may not unilaterally bind its predecessor’s employees to
continue their employment under the terms and condition of their prior employment
relationship without their consent. However, the partnership statutes that apply to the
instant case parallel the corporate statute at issue in Marenco, supra, 233 Cal.App.4th
1409,9 supporting the conclusion that DLA Piper automatically acquired the right to
enforce the arbitration agreement when it merged with Gray Cary.
       DLA Piper is a limited liability partnership organized under Maryland law. Under
Maryland Corporations and Associations Article section 3-114 (section 3-114), when a
merger of partnerships takes effect, the separate existence of the disappearing entity
ceases and the surviving entity automatically succeeds to all the rights and property of the
disappearing entity. The surviving entity becomes subject to all of the former entity’s
debts and liabilities as if the surviving entity had incurred them itself.10 Section 3-114

referenced brief is not part of our record, and was not provided to the trial court nor to
this court. Further, plaintiff has not asked this court to take judicial notice of any
pleadings submitted to the Second District panel that decided the Marenco appeal.
9
  Corporations Code section 1107, subdivision (a) provides: “Upon merger pursuant to
this chapter the separate existence of the disappearing corporations ceases and the
surviving corporation shall succeed, without other transfer, to all the rights and property
of each of the disappearing corporations and shall be subject to all the debts and liabilities
of each in the same manner as if the surviving corporation had itself incurred them.”
10
   Maryland Corporations and Associations Article section 3-114, subdivision (f)(1)
provides: “The successor is liable for all the debts and obligations of each nonsurviving
corporation, partnership, limited partnership, limited liability company, and business
trust. An existing claim, action, or proceeding pending by or against any nonsurviving
corporation, partnership, limited partnership, limited liability company, or business trust
may be prosecuted to judgment as if the consolidation or merger had not taken place, or,
on motion of the successor or any party, the successor may be substituted as a party and
the judgment against the nonsurviving corporation, partnership, limited partnership,

                                             10
also provides that “[t]he assets of each . . . limited liability company . . . transfer to, vest
in, and devolve on the successor without further act or deed.” (Section 3-114,
subd. (e)(1), italics added.) Maryland Corporations and Associations Article section
1-101, subdivision (d) provides: “ ‘Assets’ means any tangible, intangible, real, or
personal property or other assets, including goodwill and franchises.” (Italics added.) It
is not unreasonable to construe a partnership’s contractual rights as “assets.” (See, e.g.,
ITT Telecom Products Corp. v. Dooley (1989) 214 Cal.App.3d 307, 312 [“assets” of an
acquired corporation in an asset-purchase deal encompass contract rights, including the
right to enforce a contract provision against an employee].)
       The analogous California statute is even clearer as to the accession of contract
rights by merger. Gray Cary was a California limited liability partnership. Under our
state’s Corporations Code section 16914, subdivision (a)(1), “[w]hen a merger takes
effect . . . [¶] (a) The separate existence of the disappearing partnerships . . . ceases and
the surviving partnership . . . shall succeed, without other transfer, act, or deed, to all the
rights and property whether real, personal, or mixed, of each of the disappearing
partnerships . . . and shall be subject to all the debts and liabilities of each in the same
manner as if the surviving partnership . . . had itself incurred them.” (Italics added.)
Thus, both states’ laws support the conclusion that successor partnerships acquire the
right to enforce the contractual rights of the prior entity.11
       In asserting DLA Piper did not automatically succeed to the arbitration agreement,
plaintiff cites to a string of cases, only one of which involves a statutory merger. In
Delmore v. Ricoh Americas Corp. (N.D. Cal. 2009) 667 F.Supp.2d 1129 (Delmore), the

limited liability company, or business trust constitutes a lien on the property of the
successor.”
11
   Plaintiff asserts there are only two scenarios under which he could have been required
to arbitrate his state law claims against DLA Piper: (1) language in the Offer Letter
assigning the right to compel arbitration to any Gray Cary successor, and (2) a separately
negotiated arbitration agreement between him and DLA Piper. We disagree. Notably,
neither of these conditions was present in Marenco, supra, 233 Cal.App.4th 1409, yet the
appellate court was satisfied in concluding the successor corporation acquired the right to
enforce the arbitration agreement.

                                               11
court enforced a pre-merger arbitration agreement where the parties, unlike the parties in
Marenco, supra, 233 Cal.App.4th 1409, framed the issue as one of express assignment
rather than automatic transfer of rights pursuant to a merger. The plaintiff’s former
employer had merged with the defendant successor corporation and the former
employer’s employees became the employees of the defendant. (Delmore, at p. 1134.)
Subsequently, the plaintiff sued the defendant, which moved to compel arbitration. The
district court granted the motion to compel. (Id. at pp. 1132–1133.)
       As in the present case, the operative arbitration agreement in Delmore was
between the plaintiff and his former employer. (Delmore, supra, 667 F.Supp.2d at
p. 1135.) The court found the agreement had been assigned to the defendant when the
companies merged, observing the agreement specifically stated, “ ‘Disputes subject to
binding arbitration pursuant to this section also include claims against the Company’s
parent and subsidiaries, and affiliated and successor companies . . . .’ ” (Ibid.) In
addition, the agreement specifically provided: “ ‘Employee acknowledges and agrees
that in the event of the sale of the Company, or any business of the Company, this
Agreement shall be assignable to any successor company, without any further
consideration therefor, at the sole discretion of the Company.’ ” (Ibid.) Because the
defendant had assumed all of the former company’s assets, debts, rights, responsibilities,
liabilities and obligations, the court found the contractual rights in the arbitration
agreement had vested in the defendant, entitling it to enforce the agreement against the
plaintiff. (Ibid.) While the arbitration agreement at issue in the present case does not
contain the assignment language relied upon by the district court in Delmore, that case
did not address, and does not stand for, the proposition that a transfer of contractual rights
in the context of a business merger is ineffective in the absence of such language.
           3. The Offer Letter Was Not Modified
       Plaintiff contends the parties did not agree to be bound by the terms and conditions
of Gray Cary’s employment contracts after the merger, but the evidence he relies on is
not persuasive. He first cites to a provision in the law firms’ Plan of Affiliation, which
states that DLA Piper “ha[d] agreed to hire Gray Cary of counsel attorneys, associates

                                              12
and paralegals, as set forth herein, as well as certain staff, effective in each case as of
January 1, 2005 . . . .” Assuming plaintiff is correct that this passage reflects DLA
Piper’s intent to exercise its “prerogative to pick and choose its new workforce,” there is
no evidence such a practice would be inconsistent with plaintiff’s Offer Letter,
particularly as the document explicitly provided that his employment was at-will. He
also suggests that after retaining him, DLA Piper nullified the Offer Letter by distributing
its own set of workplace rules, policies, and procedures governing compensation,
partnership eligibility, and benefits. In support of this factual claim, he relies on a brief
reference to these rules that appears in an e-mail message. The record on appeal does not
contain the rules themselves. Nor does plaintiff claim these rules eliminated or modified
the arbitration provision in the Offer Letter.
       As in Marenco, the relevant law and evidence supports a finding that DLA Piper
acquired all of Gray Cary’s “assets, employees, rights, and liabilities.” (Marenco, supra,
233 Cal.App.4th at p. 1420.) Further “[t]here is no indication that the original terms of
[the plaintiff’s] employment were modified, superseded, revoked, canceled, or nullified
in any manner.” (Ibid.) It is therefore reasonable to infer that Gray Cary employees who
continued working after the merger “implicitly accepted [DLA Piper’s] decision to
maintain their existing terms of employment, including the arbitration agreement.”12
(Ibid.) Thus, the trial court’s ruling here was consistent with “the general contract law
principle that his continued employment provided implied consent to maintaining the
existing terms of employment, including the arbitration agreement.” (Ibid.) As in
Marenco, “[o]ur determination is consistent with the established principle that ‘[a]

12
   Plaintiff again attempts to distinguish Marenco, asserting that the facts showed 180
Connect and DirecTV had a separate post-merger agreement that the plaintiff’s
employment with DirecTV would be governed by the existing employment terms. His
interpretation does not appear to be consistent with the facts of that case. Far from
entering into a new arbitration agreement, the plaintiff was found to have remained bound
by the arbitration agreement he had entered into with 180 Connect, simply through his
continued employment with the successor. (Marenco, supra, 233 Cal.App.4th at
pp. 1419–1420.)

                                                 13
voluntary acceptance of the benefit of a transaction is equivalent to a consent to all the
obligations arising from it, so far as the facts are known, or ought to be known, to the
person accepting.’ ” (Marenco, supra, at p. 1420, citing to Civ. Code, § 1589.)
       Plaintiff further asserts the Wraparound Plan superseded the arbitration provision
by acknowledging an employee’s right to sue in federal court. Significantly, the
document was published after plaintiff’s employment had ended and its relevance to this
appeal is therefore questionable. Moreover, the plan’s description of benefits does not
appear to be an employment contract. In particular, we note the plan states:
“Participation in this Plan does not constitute a contract of employment between the Firm
and any employee or partner.” While the document does reference the right to litigate
claims in a state or federal court, contrary to plaintiff’s assertions, this reference is clearly
intended to apply to claims brought under ERISA only.13
       D. The Termination Agreement Did Not Supersede The Offer Letter
       At oral argument, plaintiff focused on the contention that the Termination
Agreement superseded the arbitration clause in the Offer Letter. This claim was raised in
opposition to the motion to compel, essentially maintaining the right to enforce the
arbitration agreement was trumped by the 2006 Termination Agreement. The argument
relies on the following integration clause contained in the Termination Agreement: “This
Agreement constitutes the entire agreement between the parties with respect to the
subject matter hereof and supersedes all prior negotiations and agreements, whether
written or oral [with the exception of the prior confidentiality agreements].” We
conclude this clause does not apply to the forum for resolution of disputes, as the Offer
Letter does, and therefore does not cancel the Offer Letter’s arbitration feature.
       As DLA Piper observes, the integration clause is explicitly limited to “the subject
matter hereof,” namely, the terms of plaintiff’s resignation. The Termination Agreement

13
  Plaintiff’s complaint filed in the trial court specifically disclaimed any causes of action
under ERISA. Further, while he subsequently added ERISA claims to his FAC, he
waived any judicial forum when he voluntarily consented to submit these claims to
arbitration.

                                               14
does not mention arbitration at all, and contains no provisions regarding dispute
resolution. Consequently, the identified forum for dispute resolution remains arbitration
based on the original Offer Letter.
       The leading case on this point is Cione v. Foresters Equity Services, Inc. (1997)
58 Cal.App.4th 625 (Cione).14 In that case, a securities industry employee (Cione)
entered into an agreement with the National Association of Securities Dealers, Inc.
(NASD) in which he agreed to arbitrate any disputes with his employer. (Cione, at
p. 630). Three years later, he and his employer (FESCO) entered into a written
employment agreement. The agreement included an integration clause that, like the
clause in the present case, did not specifically reference the arbitration agreement. (Id. at
pp. 630–631.)
       The appellate court in Cione held the employer was a third party beneficiary of the
NASD arbitration clause: “Cione contends the superior court properly concluded his
arbitration agreement with NASD . . . was rendered unenforceable by FESCO by virtue
of the ‘integration’ clause of his written employment agreement with FESCO lacking any
provision for arbitration. However, Cione’s contention betrays a misunderstanding of the
contract FESCO sought to enforce. FESCO did not seek to enforce its written
employment agreement with Cione. Instead, as an intended third party beneficiary,
FESCO sought enforcement of Cione’s . . . agreement with NASD.” (Cione, supra,
58 Cal.App.4th at p. 636.)
       The appellate court in Cione further held that even assuming the employment
agreement was wholly integrated, it did not supersede the NASD arbitration clause:
“Evidence would be properly admissible ‘ “to prove the existence of a separate . . .
agreement as to any matter on which the document is silent and is not inconsistent with
its terms” . . . even though the instrument appeared to state a complete agreement.
[Citations.]’ [Citation.] Since the written employment agreement was silent on the

14
  While plaintiff seeks to limit Cione, supra, 58 Cal.App.4th 625 to the securities
context, that limitation is inconsistent with Cione’s express language and the decisions
that follow it.

                                             15
forum for dispute resolution, Cione’s . . . arbitration agreement with NASD was
probative and admissible as not inconsistent with the terms of such employment
agreement.” (Cione, supra, 58 Cal.App.4th at p. 639, quoting Masterson v. Sine (1968)
68 Cal.2d 222, 226.) Finally, Cione concludes its general contract analysis by declaring:
“In sum, applying general state law principles involving revocation and enforcement of
contracts, we conclude that by entering into the written employment agreement with
Cione, FESCO did not waive its right to compel arbitration as a third party beneficiary of
the arbitration clause contained in Cione’s . . . agreement with NASD. Thus, the . . .
arbitration clause was not superseded by Cione’s separate written employment agreement
with FESCO.” (Id. at p. 640, italics added.)
       In Ramirez-Baker v. Beazer Homes, Inc. (E.D. Cal. 2008) 636 F.Supp.2d 1008
(Ramirez-Baker), an employee sued her employer for discrimination under Title VII and
state law, as well as for retaliation and breach of employment contract. Her employer
sought to arbitrate the dispute based on an applicant statement signed by the plaintiff
when she was hired in February 2007. (Id. at p. 1014.) During her employment with the
defendant, the plaintiff signed subsequent agreements containing integration clauses that
made no reference to arbitration or to forums for resolving employment disputes.15 She
claimed these subsequent integration clauses negated her original applicant statement’s
arbitration provision. The federal court rejected the argument: “The integrated clause of
the employment contracts is limited to the terms of the employment contracts.” (Id. at
p. 1016, citing Cione, supra, 58 Cal.App.4th at p. 635.) The court also observed there
was no showing the subsequent written employment agreements were expressly or
implicitly inconsistent with her arbitration obligation. This lack of inconsistency was
deemed critical even where a subsequent document purports to be a “ ‘complete
agreement.’ ” (Ramirez-Baker, at p. 1017.) Where one agreement identifies arbitration

15
  The language used was: “The foregoing constitutes the entire agreement between New
Home Counselor and Broker with respect to the subject matter covered, and [supersedes],
cancels, and nullifies any and all prior agreements and understandings.” (Ramirez-Baker,
supra, 636 F.Supp.2d at p. 1016.)

                                            16
as the forum for resolving disputes, and a subsequent agreement omits any reference to
such a forum, “ ‘any doubts must be resolved in favor of arbitration.’ ” (Id. at p. 1017;
see Thorup v. Dean Witter Reynolds, Inc. (1986) 180 Cal.App.3d 228, 234.)
       In Reynoso v. Bayside Management Company, LLC (N.D.Cal. Nov. 25, 2013,
13-CV-4091 YGR) 2013 WL 6173765 (Reynoso), the plaintiff sued his employer based
on Labor Code violations (Lab. Code, §§ 201 & 203), wrongful termination, as well as
age and national origin discrimination. In 2011, the defendant required the plaintiff to
sign an employment contract that included an arbitration agreement calling for binding
arbitration on all “claims arising out of Employee’s employment or cessation of
employment . . . .” (Reynoso, at p. *2.) More than one year later, the plaintiff signed a
new agreement which concluded with the following: “Employee understands and
acknowledges that [the new agreement] constitutes the entire agreement regarding the
terms of his employment and that this agreement may not be altered, amended[,]
modified or otherwise changed except in writing with the signed approval of the
Employer.” (Id at p. *3.) This 2012 agreement contained no arbitration provision, nor
did it incorporate by reference the terms of any other employee agreement.
       In rejecting the plaintiff’s argument that the 2012 integration clause superseded
the 2011 arbitration agreement, the district court determined the integration clause
applied only to the subject matter of the 2012 agreement, such as his at-will employment
status. Following Cione, supra, 58 Cal.App.4th 625, the court decided the 2012
agreement did not render the Arbitration Agreement unenforceable because the language
of the 2012 agreement “ ‘was reasonably susceptible to the meaning that it did not
supersede the [arbitration agreement].’ ” (Reynoso, supra, 2013 WL 6173765 at p. *4,
citing Cione, at pp. 637–640.)
       Finally, the recent decision of Ryan v. BuckleySandler, LLP (D.D.C. 2014)
69 F.Supp.3d 140 (Ryan) further supports reliance on Cione’s rationale, and is factually
similar to our case. In Ryan, the plaintiff, an attorney, sued his current employer for age
discrimination. Originally, the plaintiff was hired in 2008 to work in the Washington,
D.C., law firm of Buckley Kolar, LLP, as a temporary attorney. As a condition of

                                             17
employment, the plaintiff signed an agreement calling for “ ‘final and binding
arbitration’ ” as the “ ‘sole and exclusive remedy’ ” for claims and disputes relating to
employment at the firm. Eventually the firm became BuckleySandler, LLP. (Id. at
p. 142.)
       After being passed over for promotions, the plaintiff was informed in January
2013 that he was being terminated. He was presented with a separation agreement, which
granted him continued medical benefits and severance pay, provided he signed a release
of claims against his current employer. The agreement also contained a merger clause
that stated: “This Agreement sets forth the entire agreement between the parties with
respect to the subject matter hereof and supersedes any and all prior agreements and
understandings between them pertaining to such subject matter.”16 (Ryan, supra,
69 F.Supp.3d at p. 143.) The agreement did not provide any forum to resolve disputes
arising out of the termination agreement. (Ibid.)
       After suing the defendant, the plaintiff claimed the separation agreement
superseded the former firm’s arbitration clause. The district court determined the
integration clause in the separation agreement was “expressly limited to the subject
matter of the Separation Agreement.” That agreement “is silent as to the forum for
resolution of those claims. In this sense, the Arbitration Agreement (which mandates the
forum for the resolution of claims) concerns a distinct subject matter from the Separation
Agreement (which addresses the employment law claims of the defendant).” (Ryan,
supra, 69 F.Supp.3d at pp. 145–146.) The opinion went on to observe “courts throughout
the country have enforced pre-existing arbitration agreements when a subsequent
agreement does not address the issue of arbitration.” (Id. at p. 146.)
       Plaintiff relies on Grey v. American Management Services (2012) 204 Cal.App.4th
803 (Grey), but that case is distinguishable. In Grey, the appellate court considered
whether an employment contract containing an integration clause operated to negate an

16
 This clause in Ryan, supra, 69 F.Supp.3d 140, contains essentially the same language
we consider here.

                                             18
arbitration provision contained in a document the employee had signed when he
submitted his job application. (Id. at pp. 805–806.) The Grey court held the later
contract superseded the previous agreement, explaining that because “the [employment]
contract says it is the entire agreement, common sense dictates that it supersedes other
prior agreements related to Grey’s employment.” (Id. at p. 807.)17
       As is apparent, Grey is distinguishable from the present case, and from Cione, in
that the relevant contract at issue in Grey did not contain the limiting “with respect to the
subject matter of” language found in both the Cione NASD contract and the Termination
Agreement here. (Compare Cione, supra, 58 Cal.App.4th at p. 631 [“ ‘This Agreement
contains the entire understanding of the parties hereto with respect to the subject matter
contained herein. There are no restrictions, promises, representations, warranties,
covenants or undertakings, other than those expressly set forth or referred to in this
Agreement’ ” (italics added)] to Grey, supra, 204 Cal.App.4th at p. 807 [“ ‘This
Agreement is the entire agreement between the parties in connection with Employee’s
employment with [employer], and supersedes all prior and contemporaneous discussions
and understandings’ ” (italics added)].) Plaintiff’s efforts to distinguish Cione ignore this
limiting language. Further, that Cione concerned a securities industry registration form,
rather than a bilateral employment agreement, is a distinction without a difference with
respect to whether the parties intended to preclude enforcement of the arbitration
provision.18

17
   The temporal feature in Grey is critical. Grey applied for a position with American
Management Services sometime in June 2006 and his packet contained an issues
resolution agreement, which he signed. On July 3, 2006, days after the signing, Grey
signed an employment contract that contained a modified arbitration agreement. The
appellate court viewed this contract as the controlling agreement of the parties. The
contract reflected, by its terms and in light of the timing of the documents signed, the
final expression of the parties’ original agreement regarding Grey’s employment. (Gray,
supra, 204 Cal.App.4th at p. 807.)
18
  Again, because it is not a contract, and because it was not published until after
plaintiff’s employment ceased, we conclude the Wraparound Plan also did not supersede
the arbitration agreement.

                                             19
       It is also significant that the appellate court in Cione, supra, 58 Cal.App.4th 625,
relied on the fact that the FESCO agreement was silent with respect to arbitration in
concluding the employer had not waived its right to compel arbitration under the earlier
NASD agreement. In the present case, the Termination Agreement also is silent with
respect to dispute resolution. We therefore conclude the parties did not intend to override
the arbitration provision contained in the Offer Letter when they entered into the
Termination Agreement.
III.   Denial of Motion for New Trial
       Plaintiff also asserts the trial court relied on improper procedural grounds in
confirming arbitration and denying his new trial motion. We need not consider this point
as we have already concluded his arguments against arbitrability fail on their merits.
                                      DISPOSITION
       The judgment is affirmed.

                                                  _________________________
                                                  DONDERO, J.

We concur:

_________________________
MARGULIES, Acting P.J.

_________________________
BANKE, J.

                                             20
Trial Court                                 San Francisco County Superior Court

Trial Judge                                 Hon. Charlotte Walter Woolard
                                            Hon. Ernest H. Goldsmith

Counsel for Plaintiff and Appellant         Altshuler Berzon LLP
M. Todd Jenks                               Michael Rubin
                                            Connie K. Chan

Counsel for Defendant and Respondent        Arnold & Porter LLP
DLA Piper Rudnick Gray Cary US LLP          David J. Reis
                                            Christopher T. Scanlan

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