VILLA vs FOLSOM LAKE FORD, et al.

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

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TENTATIVE RULING

Defendants Folsom Lake Ford and Skye Mascadri’s (“Defendants”) Motion to Compel Arbitration of Plaintiff Stephanie Villa’s (“Plaintiff”) claims is ruled upon as follows.

Factual Background

This case arises out of Plaintiff’s employment by Defendants as a used car recon manager. The complaint alleges causes of action for discrimination, harassment, retaliation, failure to prevent discrimination/harassment/retaliation, breach of oral contract, breach of implied contract, negligent hiring, wrongful termination, whistleblower retaliation, intentional infliction of emotional distress, and CFRA leave retaliation.

Defendants argue that as part of her employment, Plaintiff entered into an arbitration agreement. (Minton Decl., ¶ 9, Ex. A.) This agreement states, in relevant part:

BY SIGNING BELOW, I ACKNOWLEDGE THAT I HAVE RECEIVED AND READ OR HAVE HAD THE OPPORTUNITY TO READ THIS ARBITRATION AGREEMENT. I UNDERSTAND THAT THIS ARBITRATION AGREEMENT REQUIRES THAT DISPUTES THAT INVOLVE THE MATTERS SUBJECT TO THE AGREEMENT BE SUBMITTED TO ARBITRATION PURSUANT TO THE

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

ARBITRATION AGREEMENT RATHER THAN TO A JUDGE AND JURY IN COURT

(Ex. A, p. 5.)

Defendants now move to compel arbitration of Plaintiff’s claims and stay the action pending arbitration. Plaintiff opposes.

Plaintiff’s unopposed request for judicial notice is granted for the purposes appropriate for judicial notice. (See Evid. Code § 452, subd. (d); see also Johnson & Johnson v. Superior Court (2011) 192 Cal.App.4th 757, 768 [court may take judicial notice of the existence of court documents but not to the truth of the statements contained therein].)

Legal Standard

Under California law, arbitration must be compelled where there is a valid, binding arbitration agreement unless the opposing party proves the agreement is unenforceable on unconscionability or other grounds. (See, e.g., Armendariz v. Foundation Health (2000) 24 Cal.4th 83, 96-100, 114; Gatton v. T-Mobile USA (2007) 152 Cal.App.4th 571, 579.) In fact, Code of Civil Procedure §1281.2 specifically provides, in pertinent part:

On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists, unless it determines that:

(a) The right to compel arbitration has been waived by the petitioner; or (b) Grounds exist for the revocation of the agreement.

(Underline added for emphasis.)

Section 2 of the Federal Arbitration Act (“FAA”) is essentially the same:

A written provision in any contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction or an agreement in writing to submit to arbitration an existing controversy shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

(Underline added for emphasis.) The court's role under the FAA is limited to “determining (1) whether a valid agreement to arbitrate exists and, it if does, (2) whether the agreement encompasses the dispute at issue.” (Chiron Corp. v. Ortho Diagnostic Systems, Inc. (9th Cir. 2000) 207 F.3d 1126, 1130.)

California has a public policy which encourages arbitrations, and arbitration clauses have been repeatedly enforced. (See, e.g., Moncharsh v. Heily & Blasé (1992) 3 Cal.4th 1, 9 [the California Supreme Court stated this state has a “strong public policy in favor of arbitration as a speedy and relatively inexpensive means of dispute resolution”]; Madden v. Kaiser Foundation Hospitals (1976) 17 Cal.3d 699, 707 [California’s statutory scheme “evidence[s] a strong public policy in favor of arbitrations [as a] favored method of resolving disputes”]; Gross v. Recabaren (1988) 206 Cal.App.3d 771, 775; Berman v. Dean Witter Co. (1975) 44 Cal.App.3d 999, 1003; Greenfield v. Mosley (1988) 201 Cal.App.3d 735, 744.)

“Under both federal and state law, the threshold question presented by a petition to compel arbitration is whether there is an agreement to arbitrate.” (Sparks v. Del Mar Child and Family Svcs. (2012) 207 Cal.App.4th 1511, 1517.) “In a petition to compel arbitration, the party seeking to compel arbitration bears the burden of proving the existence of a valid arbitration agreement by a preponderance of the evidence. [Citation.] The party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense, including that an arbitration provision is invalid or otherwise not enforceable.” (Brinkley v. Monterey Financial Servs., Inc. (2015) 242 Cal.App.4th 314, 325.)

“The burden of persuasion is always on the moving party to prove the existence of an arbitration agreement with the opposing party by a preponderance of the evidence.” (Gamboa v. Northeast Community Clinic (Gamboa) (2021) 72 Cal.App.5th 158, 164.) “However, the burden of production may shift in a three-step process.” (Id. at p. 165.) The moving party meets the initial burden by attaching to the moving papers a copy of the alleged arbitration agreement or setting forth its terms verbatim. (Ibid.; Cal.

Rules of Court, Rule 3.1330.) “For this step, ‘it is not necessary to follow the normal procedures of document authentication.’” (Ibid., quoting Candee v. Longwood Management Corp. (2001) 88 Cal.App.4th 215, 218.) Once the moving party meets its initial prima facie burden, the opposing party bears the burden of producing evidence to challenge the authenticity of the agreement. (Ibid.) If the opposing party meets its burden, the moving party must then offer admissible evidence to demonstrate the arbitration agreement is valid. (Ibid.)

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

Normal principles of contract interpretation apply to the interpretation of contractual arbitration provisions. Included among these is the long-accepted rule that ambiguities in an arbitration agreement, as in any other type of contract, must be interpreted against the drafting party. Interpretation of ambiguous provisions requires application of the canons of construction - such as resolving ambiguities against the drafter. (Victoria v. Superior Court (1985) 40 Cal.3d 734, 739, 745-747.)

Discussion

“The FAA provides that agreements to arbitrate ‘shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract or as otherwise provided in [the EFAA].’” (Doe v. Second Street Corp. (2024) 105 Cal.App.5th 552, 565 [quoting 9 U.S.C. § 2].) The EFAA became effective March 3, 2022, and applies “with respect to any dispute or claim that arises or accrues on or after the date of enactment of this Act.” (Id. at 566 [internal quotations omitted].)

The EFAA provides, in relevant part:

Notwithstanding any other provision of this title, at the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute . . . no predispute arbitration agreement . . . shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the sexual assault dispute or the sexual harassment dispute.

(9 U.S.C. § 402(a) [emphasis added].) Under the EFAA, a “sexual harassment dispute'” relates “to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State law.” (9 U.S.C. § 401(4).) Its application “shall be determined by a court, rather than an arbitrator,” under federal law, “irrespective of whether the party resisting arbitration challenges the arbitration agreement specifically or in conjunction with other terms of the contract containing the agreement,” or “whether the agreement purports to delegate such determinations to an arbitrator.” (9 U.S.C. § 402(b).)

In Doe v. Second Street Corp. (2024) 105 Cal.App.5th 552, 577, the Court held that, by its plain language, the EFAA applies “applies to the entire case, not merely to the sexual assault or sexual harassment claims alleged as a part of the case.” The Court noted that, “[i]t is significant, moreover, that the statute does not require that the pendant claims arise out of the sexual assault or sexual harassment dispute; it is enough that the case relates to the sexual assault or sexual harassment claims” (Id.) Accordingly, in Doe, the Court concluded that the arbitration agreement was unenforceable as to each

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

cause of action alleged – including claims under the FEHA, wage and hour claims, and intentional torts – because “all of the causes of action are asserted by the same plaintiff, against the same defendants, and arise out of plaintiff’s employment by the hotel.” (Id.)

Similarly, in Liu v. Miniso Depot CA, Inc. (2024) 105 Cal.App.5th 791, 807, the Court affirmed the trial court’s denial of the defendants’ motion to compel the plaintiff’s claims to arbitration. In Liu, the plaintiff alleged causes of action for discrimination, harassment, and retaliation under the FEHA, whistleblower retaliation, constructive termination and intentional infliction of emotional distress. (Id. at 797-798.) The Court held that a plaintiff “may not be compelled to arbitrate any of her claims” where “the ‘case’ she filed under state law (her superior court lawsuit) ‘relates to ... the sexual harassment dispute’ in that her complaint contains claims premised on conduct that is alleged to constitute sexual harassment under state law.” (Id. at 803.)

Defendants assert that the EFAA does not apply in this case because Plaintiff has not pled a viable claim for sexual harassment. Defendants contend that Plaintiff’s complaint could not withstand a challenge to the complaint – via demurrer or a Federal Rule of Civil Procedure 12(b)(6) motion – and thus, the EFAA should not preclude arbitration.[1]

The FEHA makes it an unlawful employment practice to harass an employee on the basis of, inter alia, sex and gender. (Cal. Gov. Code § 12904.) The FEHA provides that “‘harassment’ because of sex includes sexual harassment, gender harassment, and harassment based on pregnancy, childbirth, or related medical conditions. Sexually harassing conduct need not be motivated by sexual desire.” (Cal. Gov. Code § 12904(j)(4)(C).)

The California Supreme Court has explained that ““the prohibition against sexual harassment includes protection from a broad range of conduct, ranging from expressly or impliedly conditioning employment benefits on submission to or tolerance of unwelcome sexual advances, to the creation of a work environment that is hostile or abusive on the basis of sex.” (Lyle v. Warner Brothers Television Productions (2006) 38 Cal.4th 264, 277 [internal quotations and citation omitted] [internal citations omitted].) “According to regulations interpreting and implementing the FEHA, the prohibition against discrimination in employment because of sex is intended to guarantee that members of both sexes will enjoy equal employment benefits.” (Id. at p. 278.) “For FEHA claims, the discrimination requirement has been phrased similarly: To plead a cause of action for hostile work environment sexual harassment, it is only necessary to show that gender is a substantial factor in the discrimination, and that if the plaintiff had been a man she would not have been treated in the same manner.” (Id. at p. 280.)

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

The California Supreme Court has held that a claim of harassment under the FEHA may be supported by “official employment actions done in furtherance of a supervisor's managerial role” that “can also have a secondary effect of communicating a hostile message” (Roby v. McKesson Corp. (2009) 47 Cal.4th 686, 709 [citing Miller v. Department of Corrections (2005) 36 Cal.4th 446].) Such conduct may include rude comments and behavior, reprimands in front of co-workers, shunning during staff meetings, and belittling of the plaintiff’s job. (Roby, supra, 47 Cal. 4th at 710.)

Moreover, evidence of discrimination may support a claim of harassment where it may show that a supervisor’s hostility was because of the plaintiff’s protected characteristic, and a plaintiff may support a claim of hostility from comments made in a degrading manner, demeaning comments, gestures, and facial expressions. (Id. at pp. 710-711.)

In this case, Plaintiff sufficiently pleads a cause of sexual harassment. Plaintiff alleges that while she was employed by Defendant Folsom Lake Ford, Plaintiff was subjected to statements from her supervisor, Defendant Skye Mascadri which, “objectif[ied] Villa’s physical appearance, stating that Villa was no longer attractive because she was having a baby girl, and that her baby girl was stealing her attractiveness from her.” (Compl., ¶ 13(c).) Plaintiff further alleges that employees of Defendant Folsom pressured her to return to work early from her protected CFRA leave and retaliated following reasonable requests for accommodation when she returned from her pregnancy leave. (Id., at ¶ 13(d)-(f).)

When she complained about harassment she received in retaliation for seeking reasonable accommodations, Defendants failed to take any action. (Id., at ¶ 13(g), (h).) Plaintiff alleges that she suffered discrimination as the result of her sex, gender, and pregnancy, and that she suffered from harassment based on these protected characteristics.

Defendants’ reliance on Johannessen v. JUUL Labs, Inc. (N.D. Cal., June 24, 2024) 2024 WL 3173286, is unpersuasive, as the case is distinguishable. In Johannessen, the Court held that the EFAA did not apply because the plaintiff had not pled a plausible sexual harassment claim where the allegations related to personnel actions, but did not include “sexual harassment in interpersonal relationships at work.” (Id. at *4.) Specifically, the Court noted that the plaintiff had not alleged that she experienced any “epithets, derogatory comments or slurs on the basis for her gender or pregnancy” (Id. [internal quotations and citation omitted.) In this case, however, Plaintiff has alleged a number of instances of derogatory comments and interpersonal behavior that she alleges occurred on the basis of sex and pregnancy.

The Court notes that all of Plaintiff’s claims arise out of her employment and expressly relate to her allegations regarding her claim of sexual harassment. Because each cause of action relates to the “sexual harassment dispute,” the EFAA applies to bar the entire

SUPERIOR COURT OF CALIFORNIA COUNTY OF SACRAMENTO

26CV001770: VILLA vs FOLSOM LAKE FORD, et al. 06/01/2026 Hearing on Motion to Compel Arbitration in Department 8D

case, making the arbitration agreement unenforceable to this case. As such, the Court need not consider Plaintiff’s arguments of unconscionability.

Disposition

Based on the foregoing, the motion is DENIED.

The minute order is effective immediately. No formal order pursuant to California Rules of Court, rule 3.1312 or further notice is required.

[1] As the Court in Liu noted, “Federal district court decisions have interpreted the EFAA to apply only where the

plaintiff's sexual harassment related claims are capable of surviving a challenge at the pleading stage, because without such a procedural safeguard a plaintiff could avoid complying with an otherwise valid arbitration agreement by simply adding a baseless sexual harassment claim. Liu, supra, 105 Cal.App.5th at 799 n.2 [citing Yost v. Everyrealm, Inc. (S.D.N.Y. 2023) 657 F.Supp.3d 563, 586 [“allowing the EFAA to apply to sexual harassment related claims that do not satisfy the federal ‘plausibility’ standard for a motion to dismiss ‘could destabilize the FAA's statutory scheme’ because ‘[i]t would enable a plaintiff to evade a binding arbitration agreement—as to wholly distinct claims, and for the life of a litigation—by the expedient of adding facially unsustainable and quickly dismissed claims of sexual harassment’].)

As with the Court’s decision in Liu, the Court need not reach this issue because the Court finds, as set forth herein, that Plaintiff has adequately pled a claim for sexual harassment.