Opinion
B329692
07-31-2024
TONI GOODEN, Plaintiff and Respondent, v. KITE PHARMA, INC., et al., Defendants and Appellants
DTO Law, Justin T. Goodwin, Marisol Ramirez and Erik P. Mortensen for Defendant and Appellant Astrix Technology, LLC. Seyfarth Shaw, Jon D. Meer and Bethany A. Pelliconi for Defendants and Appellants Kite Pharma, Inc. and Christi Shaw. Bibiyan Law Group, David D. Bibiyan and Henry G. Glitz for Plaintiff and Respondent Toni Gooden.
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County No. 22STCV10246, Theresa M. Traber, Judge. Affirmed.
DTO Law, Justin T. Goodwin, Marisol Ramirez and Erik P. Mortensen for Defendant and Appellant Astrix Technology, LLC.
Seyfarth Shaw, Jon D. Meer and Bethany A. Pelliconi for Defendants and Appellants Kite Pharma, Inc. and Christi Shaw.
Bibiyan Law Group, David D. Bibiyan and Henry G. Glitz for Plaintiff and Respondent Toni Gooden.
ROTHSCHILD, P. J.
Defendants and appellants Kite Pharma, Inc. (Kite), Christi Shaw, and Astrix Technology, LLC (Astrix) appeal from an order denying their respective motions to compel arbitration of a lawsuit brought against them by plaintiff and respondent Toni Gooden under the Private Attorneys General Act (Lab. Code, § 2698 et seq.) (PAGA). The court denied the motions on multiple bases, including that Kite, Shaw, and Astrix (collectively, defendants) had failed to meet their burden of establishing an arbitration agreement existed, either by submitting an executed agreement or by other means. The court held that defendants' secondary evidence of an agreement, which included declarations and logs from the electronic signature platform DocuSign, was not admissible under Evidence Code section 1523. In any event, the court found that evidence, were the court to consider it, did not prove an agreement existed.
On appeal, defendants challenge these and other bases cited by the court in denying the motions. We conclude the record does not compel the conclusion that the secondary evidence defendants offered establishes an arbitration agreement existed. We thus affirm without addressing defendants' other arguments.
FACTS AND PROCEEDINGS BELOW
A. Gooden's Lawsuits
On March 24, 2022, Gooden commenced the instant lawsuit against Kite, a wholly-owned subsidiary of Gilead Sciences, Inc. (Gilead); Christi Shaw, the former Chief Executive Officer of Kite; and Astrix, a staffing agency that placed Gooden on temporary assignment with Kite. The action sought to recover penalties under the PAGA-both for Gooden and for other allegedly aggrieved employees-for various wage and hour violations.
Gooden also filed a separate class action lawsuit against only Astrix based on the same Labor Code violations alleged in the PAGA action. That class action lawsuit is not directly at issue in the instant appeal.
B. Motions to Compel Arbitration
Kite and Sharma filed a joint motion to compel arbitration on an individual basis. Astrix filed such a motion as well. Both motions relied solely on "secondary evidence" to prove the existence of an agreement; none of the movants submitted an executed arbitration agreement. We summarize this secondary evidence below.
C. Materials Submitted to Support Motions to Compel
1. Declaration of Gilead's Ellen Kaplan
Gilead's Ellen Kaplan was responsible for Kite's contingent workforce program, whereby Kite procures staffing services from various staffing agencies, including Astrix. Kaplan declared that, at all times since 2019, Kite has required all contingent workers who are sourced through such an agency to "execute the same form Contingent Worker Agreement ('CWA'), which contains an arbitration provision, before they are permitted to perform any services for Kite." An undated, unexecuted form CWA is attached to her declaration. It contains a section regarding arbitration.
Kaplan described the process by which Kite transmitted such a form CWA to Gooden, the process by which Gooden was able to review and provide her electronic signature on the form agreement, and the security protocols in place to assure such an electronic signature was true and correct. Kaplan stated the CWA was the only document Kite sent Gooden to sign via these DocuSign procedures.
Her declaration also attaches a DocuSign log bearing the header "eSignature for Document: GILDWO00023116." According to Kaplan, "the designation 'GILDWO00023116' in the DocuSign log is Toni Gooden's assignment number in Kite's Fieldglass system, which is a document management system that houses documentation for its contingent workers." It is thus not a number associated with a particular document, but rather a particular person. The log bears subheadings stating: "Sent on 4/30/2021 [at] 12:37:56 [p.m.]" [¶] "From: Gilead Contingent Workforce Program" and "Voided-Envelope has expired- Documents were purged on 6/29/21 [at] 12:00:00 [a.m.]" (Boldface omitted.) The document does not indicate why or at whose direction the "[d]ocuments were purged." (Boldface omitted.)
The log portion of the document below the header lists the following "Recipients" by name and email address: Kim Tran, Toni Gooden, "US Fieldglass Gilead Signers," and "CWP Group Mail." (Boldface omitted.) The log provides that Tran "Signed [¶] on 4/30/2021 [at] 01:05:11 [p.m.]," that Gooden "Signed [¶] on 4/30/2021 [at] 01:24:12 [p.m.]," and that the Gilead recipient "Needs to Sign." (Boldface omitted.)
Kaplan further declared that "[u]nder Kite's normal processes, a hard copy is made of all fully executed CWA forms, and they are then saved in Kite's Fieldglass system." Kaplan conducted a diligent search for such a copy bearing Toni Gooden's electronic signature, but was not able to find one.
2. Declaration of Astrix's Kim Tran
Astrix's Kim Tran declared that she received a CWA regarding Gooden's employment with Kite and signed it by DocuSign on April 30, 2021. She searched her email files and the DocuSign system, but was not able to find a copy of the executed CWA. She attached a copy of the form CWA she had received, as well as a DocuSign log that is the same as the log attached to Kaplan's declaration, except that Tran's version of the log also contains a "Private Message" in the "Recipients" row associated with Tran, informing Tran, inter alia, that "[a]s part of the onboarding process, you are required to DocuSign the Contingent Worker Agreement executed between the Supplier (yourself), Worker and Gilead Signatory, and ensure your Worker completes their execution as well."
3. Declaration of Brenda Salgado
Brenda Salgado of Kelly Services, a third party that manages the Contingent Workforce Program for Kite, also submitted a declaration. She "over[saw] . . . onboarding of contingent workers who are placed by staffing agencies for work assignments at Kite," including Gooden. She declared that "[a]t all times since 2019, Kite has also required that all staffing agencies who place contingent workers for assignments at Kite execute the form CWA before the work assignment can begin."
Salgado described the onboarding process for contingent workers, including the process by which the contingent worker receives a CWA to review and sign via DocuSign, and the process for Kelly and Astrix to confirm this has occurred so that the worker is cleared to work.
Salgado also addressed Gooden's onboarding as follows: "On April 22, 2021 Kim Tran provided me with Toni Gooden's email address, [the same address listed in the DocuSign logs]. [Using that email,] Kelly . . . initiate[d] the DocuSign process for Toni Gooden and Kim Tran to sign the CWA. On April 30, 2021, I received an email from Kim Tran, telling me that she and Toni Gooden had both signed the CWA. Upon receipt of this email I checked the DocuSign log for Toni Gooden and noted that it showed her as 'Complete'-meaning that she had signed the CWA." Attached to the declaration is an April 30, 2021 email chain in which Tran writes to Salgado that Toni Gooden, another worker, and Tran "have signed the CWA," to which Salgado responds that "both workers are showing as complete" on my end. (Capitalization omitted.)
Finally, Salgado declares the "usual practice at Kelly" is to make hard copies of all fully executed CWA forms for contingent workers and save them in Kite's document management system, but that she could not locate a copy of a CWA signed by Gooden.
D. Gooden's Opposition to the Motions to Compel Arbitration
Gooden opposed the motion to compel arbitration. Gooden primarily supported her opposition with her own declaration. In it, she declared: "I never executed any arbitration agreement with Gilead or with Astrix. Upon review of my DocuSign account, I learned that Gilead sent certain documents to my email entitled 'Gilead CWA-USA, Gilead-Contingent Workforce Guidelines.pdf' which has since been 'voided.' The full reason listed for the voided documents reads as 'Gilead CWA-USA, Gilead-Contingent Workforce Guidelines.pdf.... Envelope has expired.' Because these documents have been voided, I am unable to review them." Attached to the declaration is a copy of "a voided DocuSign entry" which includes the header "Document: GILDWO00023116"- the same number listed in all other DocuSign logs defendants submitted.
Gooden further declared: "I learned from my counsel that defendants believe I signed an arbitration agreement with Gilead on April 30, 2021. On information and belief, I did not sign any such agreement, and had I been presented with one, I would not have signed such an agreement." (Capitalization omitted.)
Gooden attached her onboarding packet from Astrix, which includes an employment agreement between Astrix and Gooden bearing Gooden's signature, dated May 11, 2021. The agreement with Astrix-to which no Gilead entity nor affiliate was a party-does not contain an arbitration clause. The agreement also includes an integration clause stating that the agreement "supersedes any statements, agreements, or representations made prior to or contemporaneously herewith."
Finally, to further support her opposition to the motions to compel arbitration, Gooden successfully requested the court to judicially notice an order from the Astrix class action, in which that court denies Astrix's motion to compel arbitration.
This order has since been affirmed in a separate appeal.
E. Order Denying Motions to Compel Arbitration
The court denied both motions, mainly on the basis that the defendants had not proven the existence of an executed arbitration agreement. The court's minute order states that, "based on the record as it existed at the time of the hearing, the court [found] [defendants] [had] not met the requirements of Evidence Code section 1523 to introduce [the] declarations as secondary evidence of the existence of a missing arbitration agreement." (Capitalization omitted.) Specifically, the court noted defendants' failure to establish that they had been sufficiently diligent in their efforts to obtain a signed copy of the agreement from DocuSign, as required by subdivision (c)(1) of Evidence Code section 1523, nor had they offered any evidence to support that the agreement had been lost "without fraudulent intent," as required by subdivision (b) of that section. The court explained that, although defendants had shown with detailed declarations that they had been sufficiently thorough in searching their own records for an executed CWA with Gooden, the evidence did not establish defendants were at "the end of the inquiry, as the CWA was allegedly sent via DocuSign and, thus, a copy might reasonably be found in DocuSign's records, if it exists at all.... [The Kaplan declaration's] conclusory statement that the defendants contacted [DocuSign] to try to locate a missing document, and [that] [DocuSign] could not do so is not sufficient to demonstrate that a writing which might logically be in [DocuSign's] possession is not 'reasonably procurable by use of the court's processes or by other available means.'" (Capitalization omitted.) The court further noted that "none of the supporting declarations offer so much as a bare recitation that the writing was lost or destroyed without fraudulent intent, such that [defendants] could take shelter under [Evidence Code section 1523, subdivision (b)]."
In its minute order, the court stated that, at the hearing "nearly six months after the motion[s] [were] filed[,] [defendants] requested more time to serve a subpoena on DocuSign to make a formal request for a diligent search for [the] CWA . . . signed by [Gooden]. The court view[ed] this offer as too little, too late" and denied defendants this opportunity to gather such additional evidence.
The parties opted to proceed on appeal without a reporter's transcript of the hearing, so the court's minute order is our only record of these proceedings. The language quoted above from the court's minute order is consistent with the defendants' characterization of the proceedings in their briefing on appeal, which describes the defendants as having requested additional time to obtain evidence from DocuSign to help show "the extent of [the defendants'] search . . . and the reasons why [the agreement] could not be obtained" and as having "offered to proffer additional evidence regarding [their] efforts to obtain the CWA." At the hearing before this court, Kite's counsel represented that the defendants also requested of the trial court that the hearing on the motions be continued so that Gooden could be cross-examined regarding the contents of her declaration. This characterization does not appear to be supported by the record on appeal, and counsel did not provide a citation to the record for his characterization. Moreover, as noted, counsel's characterization is inconsistent with the characterization of the proceeding in the defendants' appellate briefing.
The court further concluded that "[e]ven if it were to find that Astrix [or Kite] had satisfied the requirements of [Evidence Code section 1523], the [c]ourt would still conclude [they] ha[d] failed to meet [their] burden of showing the existence of an executed arbitration agreement" because "[t]he evidence negating Astrix's [and Kite's] contention [that an agreement was executed] is persuasive." Finally, the court also identified the Astrix employment agreement as an alternative, independently sufficient basis for denying Astrix's motion, because that employment agreement, by its own terms, superseded any previous agreements between Gooden and Astrix. Astrix, Kite and Shaw timely appealed the court's denial of their motions to compel arbitration.
DISCUSSION
Defendants argue that: (1) they met "the requirements of Evidence Code section 1523 to introduce the[ ] declarations as secondary evidence of the existence of a missing arbitration agreement"; (2) the secondary evidence they submitted proved the existence of such an agreement; and (3) the subsequent Astrix employment agreement-which does not require arbitration-did not supersede the arbitration agreement.
We need not reach the first and last of these contentions because, even if we consider the secondary evidence, the record does not compel that the factual conclusion defendants espouse is the only reasonable interpretation of the evidence.
We also need not address whether Evidence Code sections 1521 through 1523 even apply.
In the trial court, the party seeking to compel arbitration bears the burden of proving the existence of an agreement to arbitrate by a preponderance of the evidence. (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413.) "In such proceedings, 'the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence . . . to reach a final determination.' (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972.)" (Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541, 544.)
" 'In the case where the trier of fact has expressly or implicitly concluded that the party with the burden of proof [on a factual issue] did not carry the burden and that party appeals, it is misleading to characterize the failure-of-proof issue as whether substantial evidence supports the judgment.' [Citation.] [Instead,]' . . . the question for a reviewing court becomes whether the evidence compels a finding in favor of the appellant as a matter of law. [Citations.]" (See Juen v. Alain Pinel Realtors, Inc. (2019) 32 Cal.App.5th 972, 978-979.) Under this formulation of substantial evidence review, we must consider" 'whether the appellant's evidence was (1) "uncontradicted and unimpeached" and (2) "of such a character and weight as to leave no room for a judicial determination that it was insufficient to support [the contrary] finding" '" the appellant urges. (Sonic Manufacturing Technologies, Inc. v. AAE Systems, Inc. (2011) 196 Cal.App.4th 456, 466 (Sonic).)
At oral argument before this court, counsel for Kite and Shaw suggested that this analytical framework should not apply because, at the hearing on the motions to compel, defendants unsuccessfully requested an evidentiary hearing and the opportunity to cross-examine Gooden regarding her declaration. Even assuming that such a request would affect our analysis on appeal, the record does not support that, either in their briefing below or at the motion hearing, defendants requested an evidentiary hearing or the opportunity to cross-examine Gooden. Even if they had, the defendants offer no reason why they could not have made such a request in advance of the motion hearing.
Defendants contend that the DocuSign logs, when considered together with the defendants' declarations, unequivocally show that Gooden signed the CWA. Notably, we do not reject relying on DocuSign logs or declarations to authenticate an electronic signature on a document provided to the court in support of a motion to compel arbitration. (See, e.g., Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, 1051-1052 &1062.) But here- unlike in the cases on which defendants rely-neither motion was supported by an agreement bearing any type of electronic signature.
The trial court also based its order on the apparent failure of any Gilead or Kite entity to sign the CWA, either electronically or otherwise. Because we conclude the court did not reversibly err in finding Gooden did not execute the CWA-and thus that there could be no CWA enforceable against Gooden-we need not address the legal effect of a lack of a Gilead/Kite signature.
Astrix cites one unpublished federal district court decision in which the court concluded the defendants had sufficiently established the existence of an arbitration agreement as to all plaintiffs, even though defendants could not locate a copy of the agreement executed by one of several employee plaintiffs. (See Kim v. Cashcall, Inc. (C.D.Cal. June 8, 2017, No. SA CV 17-0076-DOC (DFMx)) 2017 WL 8186683 at *2-*3.) Even if this decision were binding on this court, which it is not, it would be of no assistance to Astrix, because the employee plaintiff for whom no executed arbitration agreement had been produced admitted that she had, in fact, signed such an agreement. (Ibid.)
Instead, defendants submitted an unexecuted CWA and DocuSign logs and declarations reflecting that Gooden signed something sent to her via the DocuSign system. These logs and declarations, however, do not "compel a finding . . . as a matter of law" (Dreyer's Grand Ice Cream, Inc. v. County of Kern (2013) 218 Cal.App.4th 828, 840) that what Gooden signed was the form CWA. The logs identify a document entitled "Gilead CWA-USA, Gilead-Contingent Workforce Guidelines.pdf." Although Kaplan declared that the only document Kite sent Gooden via DocuSign was the form CWA, the court was entitled to find that portion of her declaration not credible-particularly when the documentary evidence attached to that declaration instead refers to a file bearing a different name, when two declarants claim to retain copies of all executed CWAs, yet were unable to locate one for Gooden, and when, as the court noted, "the DocuSign account reflects a document sent to her but voided because it expired." Further, the court was free to accept Gooden's statement-declared without caveat or qualification- that "[she] never executed any arbitration agreement with Gilead or with Astrix." The court was not similarly free to rely on the portion of Gooden's declaration based on information and belief- which defendants correctly point out has no evidentiary value- but this does not render reliance on other portions of her declaration unreasonable as a matter of law.
Nor does the "GILDWO00023116" identification number of the document logs assist defendants in filling in the gaps in the evidence, as the only information in the record regarding what this number means is Kaplan's declaration that it is "Toni Gooden's assignment number in Kite's Fieldglass system, which is a document management system that houses documentation for its contingent workers"-not a number associated with the CWA or any other particular document.
Thus, we cannot say that the DocuSign logs, taken together with the other evidence before the court, are"' "of such a character and weight as to leave no room for a judicial determination that [they] [were] insufficient to support a finding" '" that Gooden executed a CWA. (Sonic, supra, 196 Cal.App.4th at p. 466.)
Finally, we reject Astrix's additional argument based on burden-shifting governing the production of evidence on a motion to compel arbitration. (See, e.g., Iyere v. Wise Auto Group (2023) 87 Cal.App.5th 747, 755.) "If the movant [seeking to compel arbitration] bears its initial burden [of a prima facie showing that an agreement exists], the burden shifts to the party opposing arbitration to identify a factual dispute as to the agreement's existence .... To bear this burden, the arbitration opponent . . .
must submit sufficient evidence to create a factual dispute and shift the burden back to the arbitration proponent." (Ibid., citing Espejo, supra, 246 Cal.App.4th at p. 1060.) Astrix argues that the defendants' secondary evidence of an arbitration agreement shifted the burden of production to Gooden, and that Gooden's declaration did not satisfy this burden because it denies only on information and belief that Gooden signed the agreement. Astrix's argument, however, ignores that Gooden also, without qualification, denied signing an arbitration agreement. And nothing in this burden-shifting framework Astrix cites changes that defendants bear the ultimate burden of proving the existence of an agreement. (See Iyere, supra, at p. 755, fn. 7 ["[t]he correct rule is thus that if an arbitration proponent makes an adequate initial showing that an agreement exists, it shifts to the opposing party not the ultimate burden of proof but only a burden of production of evidence creating a dispute as to their signature's authenticity; the ultimate burden of proof remains with the arbitration proponent"], italics omitted.) The record does not compel that they did so.
Because the evidence-including the disputed secondary evidence-is insufficient under the applicable standard of review to require reversal of the court's finding that defendants did not meet their burden to show the existence of an arbitration agreement between the parties, we affirm without addressing the other issues defendants raise on appeal.
DISPOSITION
The order is affirmed. The parties shall bear their own costs on appeal.
We concur: BENDIX, J. KELLEY, J. [*]
[*] Judge of the San Luis Obispo County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.