Leusch v. Uber Technologies, Inc.

Opinion

1 2 3 4 5 6 7 g 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA 12 | RYAN LEUSCH, Case No. 3:19-CV-00772-L-JLB 13 Plaintiff, ORDER: 14 v. (1) GRANTING 15 || UBER TECHNOLOGIES, INC., DEFENDANT'S MOTION Defendant ARBITRATION ay stay AND ig (2) DENYING AS MOOT FOR PRELIMINARY INJUNCTION [DOC. 8] 20 21 22 23 24 25 26 27 28 CASE No. 3:19-CV-00772-L-JLB 1 Plaintiff Ryan Leusch (“Leusch”) brings an individual action against 2 || Defendant Uber Technologies, Inc. (“Uber”) for violations of the Telephone 3 || Consumer Protection Act (“TCPA”’). Pending before the Court is Uber’s motion to 4 || compel arbitration and stay the action pending arbitration [doc. 14]. Leusch opposed 5 || the pending motion and Uber replied. Docs. 17, 18. Pursuant to Civil Local Rule 6 || 7.1.d.1, the Court decides this matter on the briefs as the issues were suitable for 7 || disposition without oral argument. For the reasons set forth below, the Court 8 || GRANTS Uber’s motion and STAYS this action. The Court also DENIES AS 9 | MOOT Plaintiff's motion for preliminary injunction. 10 I. Background 11 Uber offers transportation services through a smartphone application called the 12 | “Uber App.” Uber also provides meal delivery services through a different 13 | smartphone application called the “Uber Eats App.” Prior to receiving the calls at 14 || issue in this case, Leusch used the Uber App for transportation. Despite not using 15 || the Uber Eats App, Leusch was called numerous times with the following 16 || prerecorded message: 17 “Hi. This call is from Uber Eats. Your restaurant is receiving an order request, but it hasn’t been accepted. The order can be accepted by 18 clicking the blinking section on the ipad [sic]. If you are not ready to 19 accept orders right now, please change the status from accepting orders to pause orders. For any issues, please contact our support team. Thank 20 ou.” 21 |) See Doc. 8-3 at Jj 4-6, 17. Leusch contacted Uber at least three times requesting that 22 || Uber stop the calls as Leusch (1) does not own or operate any restaurant and (2) has 23 || no interest in receiving the above notification. Uber responded that it would look 24 || into it, but the calls persisted. Leusch attempted to block the numbers from which 25 || the calls were coming, but Uber kept changing the numbers it used to place these 26 || calls. 27 On April 26, 2019, Leusch filed his Complaint alleging TCPA violations 28 CASE No. 3:19-C □□□□□□□□□□□□□ 1 || against Uber. On May 16, 2019, Leusch filed a motion for a preliminary injunction 2 || because he was still receiving the above-mentioned calls from Uber after the lawsuit 3 || was filed. One June 7, 2019, Uber filed the instant motion in reliance on its “Terms 4 | and Conditions.” See Docs. 14, 14-2. 5 II. Legal Standard 6 It is undisputed that the Federal Arbitration Act (“FAA”) governs here. Under 7 || the FAA, a Court must consider two threshold questions to determine whether to 8 || compel arbitration: (1) is there a valid agreement to arbitrate? If so, (2) does the 9 || agreement cover the matter in dispute? Chiron Corp. v. Ortho Diagnostic Systems, 10 | Inc., 207 F.3d 1126, 1130 (9th Cir. 2000). “If the response is affirmative on both 11 | counts, then the [Federal Arbitration] Act requires the court to enforce the arbitration 12 || agreement in accordance with its terms.” Jd. 13 The party resisting arbitration bears the burden of proving that the claims at 14 || issue are not suitable for arbitration. Green Tree Fin. Corp.-Ala. V. Randolph, 531 15 || U.S. 79, 91 (2000). An arbitration clause can be challenged on “generally applicable 16 || contract defenses, such as fraud, duress, or unconscionability.” Rent-A-Center, West, 17 || Inc. v. Jackson, 561 U.S. 63, 68 (2010) (internal quotation marks omitted). 18 The party attempting to compel arbitration must demonstrate “(1) the existence 19 | of a valid, written agreement to arbitrate; and, if it exists, (2) that the agreement to 20 || arbitrate encompasses the dispute at issue.” Ashbey v. Archstone Prop. Mgmt., Inc., 21 | 785 F.3d 1320, 1323 (9th Cir. 2015) (citation omitted). “However, these gateway 22 || issues can be expressly delegated to the arbitrator where ‘the parties clearly and 23 || unmistakably provide otherwise.’” Brennan v. Opus Bank, 796 F.3d 1125, 1130 (9th 24 || Cir. 2015) (citing AT&T Techs., Inc. v. Comme’ns Workers of America, 475 U.S. 643, 25 || 649 (1986)); see Rent-A-Center, 561 U.S. at 78 (“ ‘[Q]uestion[s] of arbitrability’ thus 26 || include questions regarding the existence of a legally binding and valid arbitration 27 || agreement[.]’’). 28 | /// CASE NO. 3-19-CV-00772-I □□□ B 1 III. Discussion 2 The key issue presented by the parties concerns whether Leusch agreed to 3 || arbitrate the arbitrability of his claims under the Arbitration Agreement. Upon 4 || review of the Arbitration Agreement, the Court finds that this question has been 5 || delegated to the arbitrator through the following clauses: 6 “By agreeing to the Terms, you agree that you are required to resolve any claim 7 || that you may have against Uber on an individual basis in arbitration, as set forth in 8 || this Arbitration Agreement.” Doc. 14-2 at 7, Arbitration Agreement. 9 “The parties agree that the arbitrator (“Arbitrator”), and not any 10 federal, state, or local court or agency, shall have exclusive authority 11 to resolve any disputes relating to the interpretation, applicability, enforceability or formation of this Arbitration Agreement, including 12 any claim that all or any part of this Arbitration Agreement is void or 13 voidable. The Arbitrator shall also be responsible for determining all threshold arbitrability issues, including issues relating to whether 14 the terms are unconscionable or illusory and any defense to arbitration, 15 including waiver, delay, laches, or estoppel.” 16 | Doc. 14-2 at 7-8, Rules and Governing Law (emphasis added). 17 ‘A delegation clause is enforceable when it manifests a clear and unmistakable 18 || agreement to arbitrate arbitrability, and is not invalid as a matter of law.” McLellan 19 || v. Fitbit, Inc., 2017 WL 4551484, at *1 (N.D. Cal. October 11, 2017) (citing Brennan, 20 || 796 F.3d at 1130). Here, the above contract language “delegating to the arbitrator[] 21 || the authority to determine the validity or application of any of the provisions of the 22 || arbitration clause[] constitutes an agreement to arbitrate threshold issues concerning 23 || the arbitration agreement,” and such language “clearly and unmistakably indicates 24 || [the parties’] intent for the arbitrator[] to decide the threshold question of 25 || arbitrability.” Momot v. Mastro, 652 F.3d 982, 988 (9th Cir. 2011) (quoting Rent-A- 26 || Center, 561 U.S. at 68) (internal quotation marks omitted)). Leusch fails to “contest 27 || the validity of the delegation provision in particular.” Rent-A-Center, 561 U.S. at 74. 28 || Notably, Leusch does not mention the delegation clause in his opposition to the CASE NO. 3-19-CV-00772-I □□□ B 1 | motion to compel. See Doc. 17. Accordingly, the Court “must treat it as valid under 2 || § 2 [of the FAA], and must enforce it under §§ 3 and 4, leaving the challenge to the 3 || validity of the Agreement as a whole for the arbitrator.” Rent-A-Center, 561 U.S. at 4} 72. 5 IV. Motion for Preliminary Injunction 6 Motions for preliminary injunction are weighed against the following factors: 7 || C1) the likelihood of success on the merits; (2) the threat of irreparable harm in the 8 || absence of the injunction; (3) the balance between harm and injury on the interested 9 || parties if the injunction issues; and (4) the public interest. Lands Council v. Martin, 10 | 479 F.3d 636, 639 (9th Cir. 2007) (citation omitted). As a result of the Court’s grant 11 || of Uber’s motion to compel arbitration, Leusch’s motion for preliminary injunction 12 || is rendered moot. 13 Vv. Conclusion 14 Based on the foregoing, the Court GRANTS Uber’s motion to compel 15 || arbitration [doc. 14] and STAYS this action. See 9 U.S.C. § 3. The Court also 16 || DENIES AS MOOT Leusch’s motion for preliminary injunction [doc.8]. The Clerk 17 || of Court is instructed to administratively close the case. The parties must notify the 18 || Court within seven (7) days of the conclusion of arbitration proceedings. 19 IT IS SO ORDERED. 20 21 22 ||Dated: October 29, 2019 24 ory. mes Lfftnz 95 United’States District Judge 26 27 28 CASE NO. 3-19-CV-00772-I □□□ B