Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 ALIVIA LIM, an individual, on behalf of Case No.: 26-cv-2597-RSH-DEB herself and all others similar situated, 12 ORDER DENYING DEFENDANT’S Plaintiff, 13 MOTION TO COMPEL v. ARBITRATION 14 PALOMAR HEALTH, a California 15 [ECF No. 11] Health Care District; and DOES 1 16 through 100, inclusive, 17 Defendants. 18 19 Pending before the Court is a motion to compel arbitration, dismiss class and 20 collective claims, and stay the action, filed by defendant Palomar Health. ECF No. 11. 21 Plaintiff Alivia Lim filed an opposition, ECF No. 12, and Defendant filed a reply, ECF No. 22 14. For the reasons below, the Court denies the motion. 23 I. BACKGROUND 24 On February 27, 2026, Plaintiff filed a putative class action in the Superior Court of 25 California, County of San Diego. ECF No. 1-2. Plaintiff’s first and second causes of action 26 allege violations of California Labor Code § 512, § 512.1, and Wage Order No. 5-2001 for 27 failure to provide rest and meal periods. Id. at 10-15. Plaintiff’s third and fourth causes of 1 action allege breach of contract and violation of California Labor Code § 1126 for failure 2 to provide meal and rest periods as required under collective bargaining agreements 3 (“CBAs”). Id. at 15-19. Plaintiff’s fifth and final cause of action alleges violations of the 4 Fair Labor Standards Act (“FLSA”) and 29 U.S.C. § 207 for failure to pay the full amount 5 of required wages. Id. at 19-20. Plaintiff seeks to represent the following class: 6 All current and former hourly non-exempt employees of Defendants providing direct patient care or supporting direct patient care in any of 7 Defendants’ general acute care hospitals in the state of California 8 during the period of January 1, 2023 through the date of class certification. 9 10 Id. at 20. Plaintiff also seeks to represent a “collective” with the same requirements, but 11 additionally, “with at least one workweek of hours worked in excess of forty (40) hours in 12 the workweek.” Id. 13 On April 23, 2026, Defendant removed the action to this Court based on federal- 14 question and supplemental jurisdiction, and on the same day, filed its Answer. ECF Nos. 1 15 at 3; 2. On July 2, 2026, Defendant filed its motion to compel arbitration pursuant to the 16 Federal Arbitration Act (“FAA”). ECF No. 11. Defendant argues that Plaintiff’s union, the 17 California Nurses Association (“CNA”), entered into CBAs that require Plaintiff to follow 18 the “grievance and arbitration process,” including arbitration of her individual claims. ECF 19 No. 11-1 at 1-3. 20 There are two CBAs at issue, one governing from June 1, 2021, through July 31, 21 2024, and the second governing from November 6, 2024, through the end of Plaintiff’s 22 employment. Id. at 2. Both CBAs have a grievance provision stating, in Article 8: 23 A Registered Nurse or CNA initiates the grievance procedure by completing and delivering a grievance form available through the 24 Human Resources Department to the Registered Nurse’s immediate 25 supervisor or Unit Manager and the Chief Human Resources Officer or designee in the case of an individual grievance or, in the case of all 26 other grievances, to the Chief Human Resources Officer or designee. A 27 grievance should be filed within twenty (20) days of the date upon 1 which either the Registered Nurse or CNA first became aware, or reasonably should have first become aware, of the events or 2 circumstances which give rise to the grievance, including grievances 3 involving wage disputes, unless there is a mutually agreed upon written extension. 4 5 ECF Nos. 11-3 at 13-15; 11-4 at 16-18. Both CBAs also have an arbitration provision that 6 states, in Article 9: “[g]rievances which are not settled pursuant to Article 8 (Grievance 7 Procedure), and which CNA desires to contest further, shall be submitted to arbitration[.]” 8 ECF Nos. 11-3 at 16-18; 11-4 at 19-20. 9 The later CBA also incorporates a Side Letter Agreement (“SLA”), signed by 10 Palomar, the CNA, and the Caregivers and Healthcare Employees Union, which states that: 11 Palomar Health shall fully comply with SB 1334, all applicable sections within the Collective Bargaining Agreement (CBA), Labor Code 12 Section 512, and applicable Wage Orders. If a covered CNA/CHEU 13 member does not receive a meal and/or rest break in accordance with SB 1334, the member is entitled to one (1) meal period penalty for each 14 workday that one (1) or more meal periods are not provided, and one 15 (1) missed break penalty for each workday that one (1) or more rest breaks are not provided. This penalty is not counted as time worked for 16 overtime purposes. 17 ECF No. 11-4 at 119. The SLA further incorporates the grievance and arbitration 18 provisions from the earlier CBA: 19 Any disputes over the interpretation or application relating to this 20 Agreement and/or meal breaks and/or rest periods shall be resolved through the Parties’ 2021-2024 CBA grievance and arbitration 21 provisions set forth in the parties’ CBAs ending in final and binding 22 arbitration or the California Labor Commissioner at the sole discretion of the employee and the Unions. The Parties agree that even if disputes 23 over the interpretation or application of this Agreement arise after the 24 2021-2024 CBA expires, they shall be arbitrable in accordance with the process described in the Arbitration provisions of that expired CBA. 25 26 Id. 27 /// 1 II. LEGAL STANDARD 2 “In deciding whether to compel arbitration under the [Federal Arbitration Act], a 3 court’s inquiry is limited to two ‘gateway’ issues: ‘(1) whether a valid agreement to 4 arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at 5 issue.’” Lim v. TForce Logistics, LLC, 8 F.4th 992, 999 (9th Cir. 2021) (quoting Chiron 6 Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000)). “[A] statutory 7 claim [is] not subject to a presumption of arbitrability” and a CBA requirement to arbitrate 8 a statutory claim “must be clear and unmistakable.” Wright v. Universal Mar. Serv. Corp., 9 525 U.S. 70, 79-80 (1998) (citations omitted). 10 III. ANALYSIS 11 In determining whether the CBAs contain a “clear and unmistakable” requirement 12 that Lim arbitrate her statutory claims, the Court begins with the language of the 13 agreements. Article 9 of the CBAs provides: “Grievances which are not settled pursuant to 14 Article 8 (Grievance Procedure), and which CNA desires to contest further, shall be 15 submitted to arbitration[.]” ECF Nos. 11-3 at 16, 11-4 at 19. This language, by its terms, 16 does not allow Palomar to compel Lim to arbitrate her claims here. Assuming that those 17 claims fall within the definition of “grievances” contained in Article 8 of the CBAs, Article 18 9 only requires arbitration of claims “which CNA desires to contest further.” Id. Defendant 19 has not shown that this condition is satisfied here; and indeed, CNA is not a party to this 20 lawsuit. Thus, Plaintiff argues that “there is no regime provided in the CBA/Side Letter for 21 Defendant to compel Plaintiff to arbitration[.]” ECF No. 12 at 21. The Court agrees. 22 Palomar states in its reply brief that “‘a Registered Nurse or CNA’ may initiate a 23 grievance[,]” and “there is nothing precluding Plaintiff from arbitrating after the grievance 24 process ends.” ECF No. 14 at 6. This is true. But in seeking to compel arbitration, 25 Defendant must show that an arbitration agreement provides a “clear and unmistakable” 26 requirement that Plaintiff arbitrate her statutory claims—it is not enough that the arbitration 27 agreement does not preclude Plaintiff from seeking arbitration. 1 The Ninth Circuit addressed a collective bargaining agreement containing similar 2 language in Salas v. Anheuser-Busch Sales of South Bay, Inc., 650 F. App’x 445 (9th Cir. 3 2016). As described by the district court in that case, the collective bargaining agreement 4 contained a “two-step procedure” under which a grievance could be filed by either the 5 employee or the union, but the agreement then “authorize[d] the Union to seek arbitration 6 of an unresolved grievance.” Salas v. Anheuser-Busch Sales of South Bay, Inc., No. CV 7 09-7739-GHK (AJWx), 2010 WL 11482784, at *2 (C.D. Cal. Feb. 3, 2010). The district 8 court ordered arbitration, but the Ninth Circuit reversed. The Ninth Circuit determined that 9 the district court erred, among other reasons, because “the CBA provides for arbitration 10 only between the Union and [the employer]. It does not address an individual employee’s 11 right to bring a [statutory] claim against [the employer].” 650 F. App’x at 446. The CBAs 12 here likewise fail to address whether an individual employee’s statutory claims are subject 13 to binding arbitration. In place of the clause “which CNA desires to contest further,” Article 14 9 could have provided, “which CNA or the Registered Nurse desires to contest further”— 15 or Article 9 could simply have omitted the clause altogether. But instead, Defendant and 16 the CNA agreed to language that appears to put the CNA in the driver’s seat for purposes 17 of determining whether a grievance proceeds to arbitration.1 18 In a separate case involving the same corporate defendant as in Salas, the Ninth 19 Circuit likewise determined that the employer could not compel arbitration where the 20 collective bargaining agreement at issue “supplies arbitration procedures only as between 21 22 1 The language in the SLA does not further support Palomar’s position. The SLA 23 purports to incorporate Articles 8 and 9 of the earlier CBA, rather than modifying those 24 grievance and arbitration provisions. The SLA’s reference to the CBAs’ dispute resolution procedure as “ending in final and binding arbitration or the California Labor Commissioner 25 at the sole discretion of the employee and the Unions[,]” ECF No. 11-4 at 120, suggests 26 that the employee, the CNA, and the Caregivers and Healthcare Employees Union must make a joint decision to pursue arbitration. Palomar has not argued that such a condition is 27 || [the employer] and the Union.” Powell v. Anheuser-Busch Inc., 457 F. App’x 679, 680 (9th 2 || Cir. 2011). 3 Defendant has failed to establish that the CBAs that Defendant negotiated contain a 4 || “clear and unmistakable” requirement that Lim arbitrate her statutory claims. 5 Defendant’s motion asks the Court to compel “use of the grievance and arbitration 6 || process, including arbitration of Plaintiff's individual claims[.]’” ECF No. 11-1 at 13; 14 at 7 || 10. To the extent Defendant is asking for an order compelling Plaintiff to engage in some 8 || aspect of the CBAs’ grievance procedure apart from Article 9 arbitration, Defendant does 9 explain precisely what it is requesting. Plaintiff is no longer an employee of Defendant, 10 |/and the deadline for initiating a grievance under Article 8 has long passed. See ECF Nos. 11 || 11-3 at 14; 11-4 at 16. Nor does Defendant explain how it may use the Federal Arbitration 12 to compel Plaintiff to participate in a grievance procedure that is distinct from 13 || arbitration. 14 |]TV. CONCLUSION 15 For the above reasons, the Court DENIES Defendant’s motion to compel arbitration, 16 || ECF No. 11. 17 IT IS SO ORDERED. ‘ 18 Dated: September 9, 2026 [ehw 7 ‘ Howe 19 Hon. Robert S. Huie United States District Judge 20 21 22 23 24 25 26 27 28