Although appellate decisions often receive the most attention, trial court rulings can sometimes provide a clearer picture of how judges are applying evolving legal frameworks in real-world disputes. A 2023 Riverside County Superior Court decision illustrates this point. While the ruling is not precedential and does not bind other courts, it offers a thoughtful and practical analysis of arbitration agreements, the Federal Arbitration Act (FAA), the Private Attorneys General Act (PAGA), class action waivers, and the standards courts apply when evaluating whether an employment arbitration agreement is procedurally and substantively fair.
In Ligman v. Med For America, Inc., the employee brought two related actions: one asserting only a PAGA claim for civil penalties and another alleging wage and hour violations and unfair competition. The employer moved to compel arbitration of the employee’s individual claims and sought dismissal of the non-individual portion of the PAGA claim. The court’s ruling walks step-by-step through the legal framework governing arbitration enforcement in California, making it a useful reference point for employers even though it is a superior court decision.
The court began by addressing whether an agreement to arbitrate existed and whether the employer met its burden to prove that agreement. Citing well-established California Supreme Court authority, the court emphasized that petitions to compel arbitration are summary proceedings in equity and that the employer’s initial burden is to establish its existence and authenticity. Attaching a copy of the signed arbitration agreement was sufficient to meet that burden, particularly where the employee did not deny signing the agreement but instead stated she did not recall doing so. The court reiterated the long-standing rule that a party who signs a contract is generally bound by it, even if the party did not read or remember signing it, absent fraud, coercion, or similar defenses.
The court next analyzed whether the arbitration agreement was governed by the FAA. Applying federal and California authority, the court concluded that the agreement involved interstate commerce based on evidence that the employer used interstate communication networks and sent employees across state lines for business purposes. This analysis is significant because FAA coverage often determines whether state-law restrictions on arbitration are preempted.
Turning to enforceability, the court applied California’s unconscionability doctrine, which requires both procedural and substantive unconscionability, evaluated on a sliding scale. The court acknowledged that the arbitration agreement had some degree of procedural unconscionability because it was presented as a condition of employment and allegedly not explained to the employee. However, that alone was not enough to invalidate the agreement. The court then carefully evaluated substantive unconscionability and concluded that the agreement satisfied the minimum fairness requirements established by the California Supreme Court in Armendariz, including a neutral arbitrator, adequate discovery, a written award, access to all statutory remedies, and no requirement that the employee pay unreasonable arbitration costs.
The ruling is also notable for its treatment of PAGA claims in the post-Viking River landscape. The employer argued that once the employee’s individual PAGA claim was compelled to arbitration, the non-individual PAGA claim should be dismissed for lack of standing. The court rejected that argument, relying on the California Supreme Court’s decision in Adolph v. Uber Technologies, Inc., which clarified that an employee compelled to arbitrate individual PAGA claims does not lose standing to pursue non-individual PAGA claims in court. Rather than dismissing the representative PAGA claim, the court stayed it pending completion of arbitration, concluding that a stay would best conserve judicial and party resources.
Although the Ligman decision does not establish binding precedent, it provides a useful snapshot of how trial courts are synthesizing Viking River, Adolph, and long-standing California arbitration law. The ruling demonstrates that courts continue to scrutinize the process by which arbitration agreements are presented to employees, the substantive fairness of those agreements, and the proper handling of PAGA claims once individual claims are sent to arbitration.
For employers, the decision underscores several practical points. Arbitration agreements remain enforceable when properly drafted and implemented, but they must meet California’s fairness requirements. The process for obtaining employee assent matters, particularly where procedural unconscionability is alleged. And while arbitration may narrow or reshape PAGA exposure, it does not eliminate it, especially after Adolph. Even non-precedential trial court rulings like Ligman can therefore provide valuable guidance on how courts are likely to approach these issues in day-to-day litigation.