Court Opinion

ID: 9927788
Source: CourtListenerOpinion
Date Created: 2024-01-29 23:02:04.75254+00
Date Added: 2024-06-11T09:25:17.634069
License: Public Domain

Filed 1/29/24
                CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                 SECOND APPELLATE DISTRICT

                          DIVISION FIVE

 OMAR KADER,                              B326830

         Plaintiff and Respondent,        (Los Angeles County
                                          Super. Ct. No.
         v.                               22STCV17630)

 SOUTHERN CALIFORNIA
 MEDICAL CENTER, INC., et al.,

         Defendants and Appellants.

     APPEAL from an order of the Superior Court of
Los Angeles County, Daniel Murphy, Judge. Affirmed.

     Quinn Emanuel Urquhart & Sullivan, Michael E. Williams,
Dylan C. Bonfigli and Marie M. Hayrapetian for Defendants and
Appellants.

      The Law Offices of Vincent Miller, Vincent Miller and Nick
Sage for Plaintiff and Respondent.
                            _______________
       An employee signed an arbitration agreement with his
employer in the regular course of his employment, without
disclosing that he was being subjected to sexual harassment and
assault. Congress subsequently enacted the Ending Forced
Arbitration of Sexual Assault and Sexual Harassment Act (the
Act; 9 U.S.C. §§ 401, 402), which invalidates predispute
arbitration agreements in certain circumstances. Following the
effective date of the Act, the employee sued the employer and
other defendants for claims arising from the alleged sexual
conduct. The defendants filed a motion to compel arbitration,
which the trial court denied based on the Act. On appeal, the
defendants contend the Act does not invalidate the arbitration
agreement in this case because the alleged sexual conduct
constituted a “dispute,” which preexisted the parties’ arbitration
agreement and the effective date of the Act. We conclude the
date that a dispute has arisen for purposes of the Act depends on
the unique facts of each case, but a dispute does not arise merely
from the fact of injury. For a dispute to arise, a party must first
assert a right, claim, or demand. There is no evidence of a
disagreement or controversy in this case until after the date of
the arbitration agreement and the effective date of the Act, when
the employee filed charges with the Department of Fair
Employment and Housing (DFEH) in May 2022. 1 Therefore, the
predispute arbitration agreement is invalid, and the order
denying the motion to compel arbitration is affirmed.

      1 Effective June 30, 2022, after the events in this case, the
agency’s name changed to the Civil Rights Department. (Gov.
Code, § 12901.)

                                 2
         FACTUAL AND PROCEDURAL HISTORY

       Southern California Medical Center, Inc., is a community
clinic that provides care to low income and medically uninsured
patients. The Center’s chief medical officer is physician
Mohammad Rasekhi. In July 2016, the Center hired plaintiff
and respondent Omar Kader to serve as the chief financial officer.
Approximately 18 months later, Kader became the chief
operating officer. In May 2018, Kader signed his first arbitration
agreement, which is not at issue in this case.
       Kader has alleged that in July 2018, Rasekhi said Kader
had a pretty face, was a good-looking man, and his slacks were
nice and tight. Rasekhi asked if Kader watched porn and talked
about guys playing with each other at the gym steam room. He
stared at Kader’s buttocks while wetting his lips with his tongue.
       On November 18, 2018, Rasekhi allegedly forced Kader to
perform oral sex, and on April 17, 2019, forced him to touch
Rasekhi’s genitals and perform oral sex. Rasekhi threatened to
fire Kader if he revealed the incidents to anyone. Kader kept the
incidents to himself out of shame and fear of losing his job.
       On June 25, 2019, Kader signed a new arbitration
agreement agreeing to arbitrate “employment disputes” with the
Center, the human resources provider Modern HR, Inc., or any of
their respective employees or officers. The parties agreed that
any arbitration would be governed by the Federal Arbitration Act
(FAA; 9 U.S.C., §§ 1–16). The agreement provided that if Kader
filed a lawsuit containing claims that were subject to arbitration
and claims that were not subject to arbitration, the arbitrable
claims would be resolved before the nonarbitrable claims.

                                3
       Eight subsequent incidents of sexual harassment and
sexual assault allegedly took place between September 2019 and
February 28, 2022. Kader alleged that in July 2021, the Center’s
chief executive officer Sheila Busheri began making false
statements about Kader to justify retaliating against him.
       The Act became effective on March 3, 2022. Kader alleged
Rasekhi opened Kader’s blazer on March 16, 2022, and pinched
his nipple while wetting his lips with his tongue.
       In May 2022, Kader filed a complaint with the DFEH and
requested an immediate right-to-sue notice. DFEH closed the
complaint and issued a right-to-sue notice on May 27, 2022.
       That same day, Kader filed a complaint against the Center,
Rasekhi, Busheri, six of the Center’s board members, Modern
HR, and two additional entities. He alleged causes of action for
sexual harassment, discrimination on the basis of race, national
origin and/or sex, failure to prevent discrimination and
harassment, retaliation, intentional infliction of emotional
distress, negligence, sexual battery, and defamation.
       It is unclear from the complaint whether Kader complained
about Rasekhi’s conduct to anyone other than Rasekhi. Kader
alleged he felt that he could not report Rasekhi’s conduct to the
Center or its related entities without suffering retaliation. Kader
also alleged, however, that he reported Rasekhi’s inappropriate
conduct to the Center and a related entity, and he objected to the
defendants’ racism and discriminatory hiring practices. In
response to Kader’s reports and complaints, the Center and the
other entities retaliated against him through a demotion, a pay
cut, and retraction of a bonus. In addition, Busheri began
making false statements in July 2021 in retaliation against

                                 4
Kader for resisting Rasekhi’s conduct and objecting to
discrimination.
       The Center, Rasekhi, Busheri, and the six board members
(collectively the Center defendants) filed a motion to compel
arbitration. They argued that the Act did not apply because: (1)
Kader’s claims accrued prior to the effective date of the Act, and
(2) the arbitration agreement was signed after the conduct giving
rise to sexual harassment or sexual assault took place.
       In support of the motion, they submitted Busheri’s
declaration stating that Kader never made any complaint to her
about Rasekhi’s conduct during his employment. She was not
aware of any complaints Kader made to Modern HR about any of
the Center’s officials or employees. In fact, during the time of the
alleged incidents, Kader sent text messages to Busheri
expressing support of Rasekhi. 2
       Kader opposed the motion brought by the Center
defendants. He argued that the Act covered disputes or claims
arising or accruing after March 3, 2022, and under the continuing
violation doctrine, his causes of action accrued after March 3,
2022. He also argued that the arbitration agreement was
contrary to public policy, unconscionable, and there was a
possibility of conflicting rulings resulting from litigation with
third parties.
       Kader submitted his own declaration in support of the
opposition. He stated that when he refused to work with

      2 Modern HR also filed a motion to compel arbitration,
which is not at issue in this appeal. Modern HR submitted
evidence showing the company ceased to be a provider for the
Center and had no relationship with Kader, the Center, or any
other defendant after January 2022.

                                 5
Rasekhi, travel alone with him, or be behind closed doors with
him, Rasekhi and Busheri began to retaliate against him. He
stated that the defendants were aware of the allegations against
Rasekhi based on the complaints of several other employees.
       The trial court initially granted the motion, finding that
each alleged sexual assault was independently actionable, and
therefore, all but one claim accrued prior to the Act. The court
stayed litigation on claims that arose after March 2, 2022,
pending arbitration on the claims that arose before March 2,
2022.
       Kader petitioned this appellate court for a writ of mandate,
which this court granted. This court ordered the trial court to
reconsider the order granting the motion to compel arbitration or
show cause why a peremptory writ should not issue. After a
hearing on February 10, 2023, the trial court vacated its prior
order and denied the motion to compel arbitration. The Center
defendants filed a timely notice of appeal from the February 2023
order.

                         DISCUSSION

       The Center defendants contend that the Act does not
invalidate the arbitration agreement in this case for two reasons.
First, it is not a “predispute” arbitration agreement because the
conduct began before the agreement was signed. Second, the Act

                                 6
does not apply because Kader’s claims accrued before the
effective date of the Act. We disagree with these contentions.

Standard of Review

       “California statutes create a ‘summary proceeding’ for
resolving petitions or motions to compel arbitration. [Citation.]
‘The petitioner bears the burden of proving the existence of a
valid arbitration agreement by the preponderance of the
evidence, and a party opposing the petition bears the burden of
proving by a preponderance of the evidence any fact necessary to
its defense. [Citation.] In these summary proceedings, the trial
court sits as a trier of fact, weighing all the affidavits,
declarations, and other documentary evidence, as well as oral
testimony received at the court’s discretion, to reach a final
determination.’ [Citation.]” (Chambers v. Crown Asset
Management, LLC (2021) 71 Cal.App.5th 583, 590, fn. omitted.)
       “ ‘There is no uniform standard of review for evaluating an
order denying a motion to compel arbitration. [Citation.] If the
court’s order is based on a decision of fact, then we adopt a
substantial evidence standard. [Citations.] Alternatively, if the
court’s denial rests solely on a decision of law, then a de novo
standard of review is employed. [Citations.]’ [Citation.] ”
(Carlson v. Home Team Pest Defense, Inc. (2015) 239 Cal.App.4th
619, 630.)
       We review statutory interpretation issues de novo. (State
Farm Mut. Auto. Ins. Co. v. Department of Motor Vehicles (1997)
53 Cal.App.4th 1076, 1081.) “The objective of statutory
interpretation is to ascertain and effectuate legislative intent. To
accomplish that objective, courts must look first to the words of

                                 7
the statute, giving effect to their plain meaning. If those words
are clear, we may not alter them to accomplish a purpose that
does not appear on the face of the statute or from its legislative
history. [Citation.] Whenever possible, we must give effect to
every word in a statute and avoid a construction making a
statutory term surplusage or meaningless. [Citations.]” (In re
Jerry R. (1994) 29 Cal.App.4th 1432, 1437.)

Statutory Scheme

       The Act consists of two sections. Section 402, subdivision
(a), provides that at the election of the person alleging conduct
constituting a sexual harassment dispute or sexual assault
dispute, “no predispute arbitration agreement or predispute joint-
action waiver shall be valid or enforceable with respect to a case
which is filed under Federal, Tribal, or State law and relates to
the sexual assault dispute or the sexual harassment dispute.”
Any issue as to whether the Act applies to a dispute is to be
determined under federal law. (9 U.S.C. § 402, subd. (b).)
       Section 401 of the Act defines several relevant terms: (1)
a predispute arbitration agreement is “any agreement to
arbitrate a dispute that had not yet arisen at the time of the
making of the agreement;” (2) a sexual assault dispute is “a
dispute involving a nonconsensual sexual act or sexual contact;”
and (3) a sexual harassment dispute is “a dispute relating to
conduct that is alleged to constitute sexual harassment under
applicable Federal, Tribal, or State law.” (9 U.S.C. § 401, subds.
(1), (3), & (4).)
       A statutory note to the Act adds: “This Act, and the
amendments made by this Act, shall apply with respect to any

                                 8
dispute or claim that arises or accrues on or after the date of
enactment of this Act.” (Pub.L. No. 117-90, § 3, reprinted in
notes foll. 9 U.S.C. § 401.) All provisions enacted by Congress,
including a provision codified as a statutory note, must be given
equal weight regardless of their placement by the codifier.
(Famuyide v. Chipotle Mexican Grill, Inc. (D. Minn., Aug. 31,
2023, No. CV 23-1127 (DWF/ECW)) 2023 WL 5651915, at *3
(Famuyide).) “The Court must read § 402(a) in conjunction with
the statutory note, as both are binding law.” (Ibid.)

Date of Dispute

       The Center defendants contend the arbitration agreement
in this case is not a “predispute” arbitration agreement because
the conduct allegedly began before Kader signed the arbitration
agreement. We disagree with the Center’s interpretation of the
term “dispute.”
       The Act does not define a “dispute” or state when a dispute
has “arisen.” We look to general and legal dictionaries for a
term’s ordinary meaning. (Fair Education Santa Barbara v.
Santa Barbara Unified School District (2021) 72 Cal.App.5th 884,
898.) The Cambridge Dictionary defines a dispute as “an
argument or disagreement, especially an official one.”
(Cambridge Dictionary, https://dictionary.cambridge.org/us/dictio
nary/english/dispute (Jan. 22, 2024).) Black’s Law Dictionary
defines a dispute as a “conflict or controversy, esp. one that has
given rise to a particular lawsuit.” (Black’s Law Dictionary (11th
ed. 2019).) Merriam-Webster’s Dictionary of Law states a dispute
is “an assertion of opposing views or claims: a disagreement as to
rights[,] especially: one that is the subject of proceedings for

                                9
resolution (as arbitration).” (Merriam-Webster’s Dictionary of
Law,
https://www.merriam- webster.com/dictionary/dispute#legalDictio
nary (Jan. 22, 2024).)
       We conclude the date that a dispute has arisen for purposes
of the Act is a fact-specific inquiry in each case, but a dispute
does not arise solely from the alleged sexual conduct. A dispute
arises when one party asserts a right, claim, or demand, and the
other side expresses disagreement or takes an adversarial
posture. (Famuyide, supra, at *3.) In other words, “[a] dispute
cannot arise until both sides have expressed their disagreement,
either through words or actions.” (Id. at *8.) Until there is a
conflict or disagreement, there is nothing to resolve in litigation.
(Ibid.)
       “Other courts have analyzed this language and similarly
concluded that a dispute requires some sort of disagreement or
‘adversarial posture.’ [(Hodgin v. Intensive Care Consortium, Inc.
(S.D. Fla., Mar. 31, 2023, No. 22-81733-CV) 2023 WL 2751443, at
*2 (Hodgin); Silverman v. DiscGenics, Inc. (D. Utah, Mar. 13,
2023, No. 2:22CV00354-JNP-DAO) 2023 WL 2480054, at *2]
(concluding dispute arose when plaintiffs filed discrimination
charges with government agency).)]” (Famuyide, supra, at *3.)
The term dispute is broader than simply filing an action in court
and includes many forums. (Ibid.)
       The Center defendants contend, however, that a dispute
arises when the alleged conduct occurs that constitutes sexual
assault or sexual harassment, citing Barnes v. Festival Fun
Parks, LLC (W.D. Pa., June 27, 2023, No. 3:22-CV-165) 2023 WL
4209745 at *1 (Barnes). We disagree. The Barnes court
acknowledged that the terms “dispute” and “claim” have distinct

                                10
meanings as used by Congress, but then conflated the terms in
that court’s analysis. (Barnes, supra, at *26–27.)
       In general, a claim arises for the first time when the
plaintiff suffers an injury. (In re Marriage of Klug (2005) 130
Cal.App.4th 1389, 1398 (Klug).) A cause of action accrues, and
the statute of limitations begins to run, when the last element
essential to the cause of action occurs and the plaintiff is entitled
to maintain an action. (Id. at pp. 1399–1400.) A cause of action
often arises and accrues at the same time, but the dates can be
different under some circumstances, such as when a cause of
action arises at the time of injury but does not accrue until
discovery. (Ibid.) Unlike a claim, however, a dispute does not
arise simply because the plaintiff suffers an injury; it additionally
requires a disagreement or controversy. (Hodgin, supra, at *2,
Famuyide, supra, at *3.)
       “The definitions within the [Act] also make clear that a
dispute requires more than an injury. The [Act] defines a ‘sexual
assault dispute’ as ‘a dispute involving a nonconsensual act or
sexual conduct,’ and it defines ‘sexual harassment dispute’ as ‘a
dispute relating to conduct that is alleged to constitute sexual
harassment.’ [(9 U.S.C. § 401 (emphasis added).)] If the
underlying conduct alone—the sexual assault or harassment—
automatically gave rise to a dispute, then the legislature’s use of
the word ‘dispute’ within these two definitions would be
superfluous. A ‘sexual assault dispute’ would merely mean ‘a
nonconsensual act or sexual conduct.’ And a ‘sexual harassment
dispute’ would mean ‘conduct that is alleged to constitute sexual
harassment.’ This cannot be so. ‘[A] statute should be construed
so that effect is given to all its provisions, so that no part will be

                                 11
inoperative or superfluous, void or insignificant.’ [Citation.]”
(Famuyide, supra, at *11.)
      The Center defendants additionally rely on an unpublished
federal district court order, Zinsky v. Russin (W.D. Pa., July 22,
2022, No. 2:22-CV-547) 2022 WL 2906371, at *4 (Zinsky). The
Zinsky court found the Act did not apply in that case based on the
date that a claim accrues under state law, but failed entirely to
consider or analyze the date that a dispute arises. We do not find
the Zinsky opinion persuasive.
      In the present case, there is no evidence that a dispute
existed between the parties prior to or at the time of signing the
new arbitration agreement on June 25, 2019. Kader alleged
three incidents of sexually harassing or assaultive conduct took
place before the agreement was signed, but there is no evidence
that any dispute yet existed. In fact, Kader alleged Rasekhi
threatened to fire him if he told anyone, implying that Rasekhi
did not dispute the conduct. There was no evidence that Kader
asserted any right, claim, or demand prior to filing charges with
the DFEH in May 2022, and at oral argument, Kader’s attorney
conceded that Kader never complained to anyone at the Center
about Rasekhi’s conduct. There is also no evidence that the
Center defendants disagreed with any claim asserted by Kader
until after he filed charges with DFEH. The trial court properly
concluded that the Act applies, because the arbitration
agreement was executed before the dispute arose between the
parties in May 2022.

                               12
Case Filed After Effective Date

        The Center defendants also contend the Act does not apply
because Kader’s claims accrued before the effective date of the
Act. We disagree with this analysis.
        Section 402, subdivision (a), unambiguously states that it
applies in any case that relates to the sexual assault dispute or
sexual harassment dispute. (Murrey v. Superior Court (2023) 87
Cal.App.5th 1223, 1235.) Under the plain meaning of section
402, subdivision (a), the Act applies to the instant case, which
was filed after the effective date of the Act.
        The statutory note states that the Act applies to “any
dispute or claim that arises or accrues on or after the date of
enactment of this Act.” (Pub.L. No. 117-90, § 3, reprinted in notes
foll. 9 U.S.C. § 401.) As discussed above, a claim may arise or
accrue before a dispute arises, and additional claims may arise
after a dispute arises. The dispute in this case arose in May
2022, after the effective date of the Act. The trial court properly
concluded that the Act applied to invalidate the predispute
arbitration agreement in this case.

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                        DISPOSITION

      The order denying the motion to compel arbitration is
affirmed. Plaintiff and respondent Omar Kader is awarded his
costs on appeal.

                                       MOOR, J.

We concur:

             RUBIN, P. J.

             KIM, J.

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