18th Annual Workplace Class Action Report - 2022 Edition

634 Annual Workplace Class Action Litigation Report: 2022 Edition laws to Plaintiffs via mail or email, or whether Plaintiffs had access to the by-laws online before their membership applications were approved. Id . Accordingly, the Court ruled that there was a factual dispute about whether the by-laws were readily available to Plaintiffs when they submitted their applications, and whether they were thus incorporated by reference into the applications. Id . at *10. The Court opined that if the by-laws were not incorporated, then there was no agreement to arbitrate. For these reasons, the Court denied Defendant’s motion to compel arbitration. DiCarlo, et al. v. MoneyLion, LLC, 988 F.3d 1148 (9th Cir. 2021). Plaintiff, a loan recipient, filed a class action alleging that Defendant violated the California Unfair Competition Law (“UCL”), False Advertising Law (“FAL”), and Consumers Legal Remedies Act (“CLRA”) when it refused to allow her to cancel her MoneyLion Plus membership when she fell behind on her payments for the program. Defendant’s Plus members owed monthly fees, monthly investment deposits, and monthly loan payments as part of the membership agreement, and in exchange they received a small business loan at a low interest rate. Defendant filed a motion to compel arbitration of Plaintiff’s claim pursuant to an agreement contained in the membership agreement. The District Court granted Defendant’s motion on the basis that the agreement’s arbitration provision was valid and enforceable because it allowed public injunctive relief in arbitration and therefore did not violate California’s McGill rule, in which the California Supreme Court held that no one can contractually waive all rights to seek public injunctive relief. Id . at 1152-53. The District Court determined that since the agreement authorized the arbitrator to award all injunctive remedies available in an individual lawsuit under California law, it was valid and enforceable. Plaintiff argued that she could secure public injunctive relief only by acting as a private attorney general, which the agreement explicitly prohibited. On appeal, the Ninth Circuit agreed with the District Court’s ruling, and held that public injunctive relief under the UCL, FAL, and CLRA was available in an individual lawsuit without a Plaintiff acting as a private attorney general. The Ninth Circuit reasoned that under California Supreme Court precedent, because individuals seeking public injunctive relief under the UCL and FAL do so "on their own behalf" and not "on behalf of the general public," the relief remained available. Id . at 1156. For these reasons, the Ninth Circuit affirmed the District Court’s ruling granting Defendant’s motion to compel arbitration. Farmer, et al. v. Airbnb, Case No. 20-CV-7842 (N.D. Cal. June 1, 2021). Plaintiff, a vacation rental property host, filed a class action alleging that Defendant unlawfully kept funds from hosts that they were rightfully owed when guests were forced to cancel reservations with Defendant due to the COVID-19 pandemic. Defendant filed a motion to compel arbitration of Plaintiff’s claims pursuant to an arbitration agreement signed as part of the host agreement. The Court granted the motion. Plaintiff not did argue that a valid arbitration agreement existed or that his individual claims fell within the scope of the agreement. Plaintiff initiated arbitration of his claims with the American Arbitration Association (“AAA”), and subsequently attempted to withdraw from arbitration. Plaintiff subsequently asserted that Defendant violated its obligations under Section 1281.98 of the California Code of Civil Procedure, which requires payment of “fees or costs required to continue the arbitration proceeding . . . within 30 days after the due date,” when Defendant failed to timely pay the $1,500 arbitrator compensation fee requested by the AAA. Id . at 2. The Court found that the arbitration agreement contained a delegation provision, and therefore, any argument with respect to payment of initiation fees would require that question to be decided by the arbitrator. The Court held that Plaintiff cited no authority for the proposition that a judge should determine whether a party is in default for failing to timely pay fees where, as here, questions of arbitrability have been delegated to the arbitrator, and the arbitrator has not found the party to be in default or terminated the proceedings for non-payment. Id . at 3. Accordingly, the Court granted Defendant’s motion to compel arbitration. Foster, et al. v. Wal-Mart, Inc., 2021 U.S. App. LEXIS 30216 (8th Cir. Oct. 8, 2021). Plaintiffs, a group of gift card purchasers, filed a class action alleging that the gift cards they purchased from Defendant were tampered with and the funds were stolen, but Defendant refused to provide a refund for the worthless cards. Defendant filed a motion to compel arbitration of Plaintiffs’ claims, which the District Court denied. On appeal, the Eighth Circuit reversed and remanded the District Court’s ruling. Defendant contended that the parties had a binding arbitration agreement at the moment Plaintiffs purchased their gift cards because every card had a notation on the back directing the customer to "see Walmart.com for complete terms," which included a binding arbitration agreement. Id . at *6. The parties did not dispute that this case involved a browsewrap agreement, and that Plaintiffs were not asked to agree to the terms and conditions on Defendant’s website. The Eighth Circuit explained that it must look to the notice provided to Plaintiffs, and whether it was actual notice, which occurs