Court Opinion

ID: 4400582
Source: CourtListenerOpinion
Date Created: 2019-05-24 20:00:25.43148+00
Date Added: 2024-06-11T14:52:24.277941
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS
                                                                            FILED
                            FOR THE NINTH CIRCUIT
                                                                            MAY 24 2019
                                                                         MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS
NIDHAL BEN-SALAH,                                No.   18-35140

              Plaintiff-Appellant,               D.C. No. 3:17-cv-00907-YY

 v.
                                                 MEMORANDUM*
STERLING JEWELERS, INC., DBA
Jared Galleria of Jewelry, a Delaware
corporation,

              Defendant-Appellee.

                    Appeal from the United States District Court
                             for the District of Oregon
                    Michael H. Simon, District Judge, Presiding

                             Submitted May 15, 2019**
                                 Portland, Oregon

Before: N.R. SMITH, WATFORD, and R. NELSON, Circuit Judges.

      Nidhal Ben-Salah appeals the district court’s order compelling arbitration

and dismissing his employment discrimination case against his employer, Sterling

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Jewelers, Inc. (“Sterling”). We have jurisdiction under 28 U.S.C. § 1291, and we

affirm.

      1.     We affirm the district court’s determination that Ben-Salah agreed to

arbitration. Whether Ben-Salah entered into the RESOLVE Arbitration Agreement

(“RAA”) is a question of fact. See Seyfried v. O’Brien, 81 N.E.3d 961, 967 (Ohio

Ct. App. 2017). Ben-Salah did not specifically object to the magistrate judge’s

factual determination that he agreed to the RAA by electronically signing the

“Acknowledgement.” Thus, he waived his right to challenge the magistrate

judge’s determination on appeal. See Bastidas v. Chappell, 791 F.3d 1155, 1159

(9th Cir. 2015).

      2.     We affirm the district court’s determination on fraudulent inducement.

Ben-Salah did not specifically challenge the magistrate judge’s legal determination

that an arbitrator must decide whether Sterling fraudulently induced Ben-Salah to

accept the RAA in his objections to the district court. While failing to object to a

magistrate judge’s legal conclusions does not constitute an automatic waiver of the

right to challenge those findings on appeal, we may weigh Ben-Salah’s failure to

object in favor of finding waiver on appeal. See Miranda v. Anchondo, 684 F.3d
844, 848 (9th Cir. 2012). Ben-Salah takes issue with the magistrate judge’s

understanding that Ben-Salah was arguing the entire agreement was fraudulently

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induced, not just the arbitration provisions. See Rent-A-Ctr., W., Inc. v. Jackson,

561 U.S. 63, 71 (2010) (arguments of “fraud in the inducement of the arbitration

clause itself” are for the court, while challenges to the validity of the contract as a

whole are for an arbitrator) (citation omitted). Because he failed to object to the

magistrate judge’s determination before the district court, we do not have the

district court’s analysis. Further, Ben-Salah does not even acknowledge his failure

to object in his briefing on appeal.

       Even if Ben-Salah had not waived his fraudulent inducement challenge, his

allegations fall short of a prima facie case for misrepresentation under Ohio law.

See Volbers-Klarich v. Middletown Mgt., Inc., 929 N.E.2d 434, 440 (Ohio 2010)

(listing elements). Ben-Salah has not alleged that the Sterling manager’s

representation that Ben-Salah was only scrolling through and signing “policies,”

even if it were false and material, was made with the manager’s knowledge of its

falsity or intent to deceive.

       3.     We affirm the district court’s determination that the RAA was not

unconscionable. Under Ohio law, “the party challenging a contract as

unconscionable must prove ‘a quantum’ of both procedural and substantive

unconscionability.” Taylor Bldg. Corp. of Am. v. Benfield, 884 N.E.2d 12, 24

(Ohio 2008). Although determining whether a contract is unconscionable involves

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a question of law, finding procedural unconscionability involves factual

determinations regarding the circumstances surrounding the making of the

contract. See id. at 21. Ben-Salah’s real disagreement lies with the magistrate

judge’s factual findings about procedural unconscionability, to which Ben-Salah

did not specifically object before the district court, thus precluding our review on

appeal.1 See Bastidas, 791 F.3d at 1159. Because we affirm the district court’s

finding on procedural unconscionability, we may not set aside the RAA as

unconscionable. See Taylor, 884 N.E.2d at 24.

      4.     The district court did not abuse its discretion by declining to decide

the question of equitable tolling. The arbitration agreement provides that “a court

may decide procedural questions that grow out of the dispute and bear on the final

disposition of the matter (e.g., one (1) year for filing a claim)” in the event a party

has already initiated a judicial proceeding. This statement rebuts the presumption

that the issue must be a question for the arbitrator. See Howsam v. Dean Witter

Reynolds, Inc., 537 U.S. 79, 85 (2002) (deciding that procedural disputes are

      1
         For example, Ben-Salah’s declaration never alleged that he was “instructed
not to review the documents,” as he contends on appeal. Nor did Ben-Salah allege
that he was pressured to sign the “Acknowledgement,” or given insufficient time to
read or digest its provisions. Nor did Ben-Salah object to the magistrate judge’s
failure to make a factual finding about Ben-Salah’s inability to access a copy of the
RAA.
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presumptively a question for the arbitrator unless the arbitration agreement

provides otherwise). However, as a matter of contract interpretation, by providing

that the court “may” decide procedural questions, the agreement grants the court

discretion as to whether to decide them. The district court exercised that discretion

and provided a reasoned basis for determining it would not decide the issue.

      AFFIRMED.

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