Mayra Manzano v. POM Medical, LLC et al.

O [6] 7 United States District Court 8 Central District of California [9] 10 MAYRA MANZANO, Case № 2:25-cv-00993-ODW (SSCx) 11 Plaintiff, ORDER DENYING DEFENDANTS’ 12 v. MOTION TO COMPEL ARBITRATION [15] 13 POM MEDICAL, LLC et al., 14 Defendants. [15] 16 I. INTRODUCTION 17 Plaintiff Mayra Manzano brings this putative wage-and-hour class action 18 against Defendants POM Medical, LLC and Stryker Employment Company, LLC 19 (collectively, “Defendants” or “Stryker”). (Decl. Julia Y. Trankiem ISO Notice 20 Removal Ex. A (“Compl.”), Dkt. No. 3.) Stryker moves to compel Manzano to 21 arbitrate her individual claims, dismiss her class claims, and stay the case pending 22 arbitration. (Mot. Compel Arb. (“Motion” or “Mot.”) 1, Dkt. No. 15.) For the 23 following reasons, the Court DENIES Stryker’s Motion.1 24 II. BACKGROUND 25 On or about May 22, 2023, Manzano obtained employment with Kelly Services 26 Global, LLC (“Kelly”), a third-party staffing agency. (Decl. Elisa Cropper ISO Mot. [27] 28 1 After carefully considering the papers filed in support of and in opposition to the Motion, the Court deems the matter appropriate for decision without oral argument. Fed. R. Civ. P. 78; L.R. 7-15. 1 (“Cropper Decl.”) ¶¶ 9–10, Dkt. No. 15-3.) Kelly placed Manzano with Stryker 2 beginning on the same date, to provide “services to Stryker on a temporary basis in a 3 manufacturing role until her temporary assignment ended on or about September 17, 4 2023.” (Opp’n 5, Dkt. No. 18 (quoting Decl. Salah Ali ISO Mot. (“Ali Decl.”) ¶ 27, 5 Dkt. No. 15-2).) Manzano entered into an arbitration agreement with Kelly (“Kelly 6 Agreement”), “a short standalone document” that requires Manzano and Kelly to 7 arbitrate covered claims that arise between Manzano and Kelly, its affiliated 8 companies, and its clients or customers. (Mot. 3; Ali Decl. ¶ 25, Ex. A (“Kelly 9 Agreement”) § 1, Dkt. No. 15-2.) 10 Effective September 18, 2023, Stryker hired Manzano to work for it directly, 11 performing the same work and at the same location where she had previously worked 12 through Kelly. (Mot. 2–3; Cropper Decl. ¶¶ 11–13.) Stryker did not present Manzano 13 with any arbitration agreement related to her direct employment. (See Opp’n 5; see 14 generally Mot. (identifying no arbitration agreement other than the Kelly 15 Agreement).) Manzano remained a Stryker employee until February 27, 2024. 16 (Cropper Decl. ¶ 11.) 17 In July 2024, Manzano filed a representative action against Kelly and Stryker, 18 asserting a claim under the California Private Attorney Generals Act (“PAGA”) based 19 on labor code violations during her work at Stryker between May 22, 2023, and 20 February 27, 2024. (Defs.’ Req. Judicial Notice (“RJN”) Ex. 1, Dkt. No. 15-5 21 (complaint in Manzano’s PAGA action).2) After reviewing the Kelly Agreement, 22 Manzano stipulated to arbitrate her claims against Kelly and dismissed Stryker from 23 that suit. (RJN Ex. 2 (order approving stipulation to arbitrate in Manzano’s PAGA [24] 25 2 The Court GRANTS Stryker’s request for judicial notice of the complaint and an order approving the parties’ stipulation to arbitrate in Manzano’s PAGA action against Kelly and Stryker, as they are 26 court filings and a matter of public record. Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741 , 746 n.6 (9th Cir. 2006). However, as the Court reaches its conclusions without relying on Stryker’s [27] third document, it DENIES the remaining request. See Migliori v. Boeing N. Am., Inc., 97 F. Supp. 28 2d 1001, 1003 n.1 (C.D. Cal. 2000) (declining to take judicial notice of exhibits that “do not affect the outcome of” the motion). 1 action).; Decl. Julia Y. Trankiem ISO Mot. ¶ 3, Dkt. No. 15-4.) On November 26, 2 2024, Manzano filed this second action against Stryker only, limiting her wage-and3 hour claims to the time period during which she worked for Stryker directly— 4 September 18, 2023, to February 27, 2024. (Compl. ¶ 2.) Stryker now moves to 5 compel Manzano to arbitrate her claims based on the Kelly Agreement. (Mot. 1–2.)3 6 III. LEGAL STANDARD 7 The Federal Arbitration Act (“FAA”) governs a contract dispute relating to an 8 arbitration provision when that provision “has a substantial relationship to interstate 9 commerce.” Carbajal v. CWPSC, Inc., 245 Cal. App. 4th 227, 234 (2016); 10 Allied-Bruce Terminix Cos., Inc. v. Dobson, 513 U.S. 265 , 273–74 (1995). When it 11 applies, the FAA restricts a court’s inquiry into compelling arbitration to two 12 threshold questions: (1) whether there was an agreement to arbitrate between the 13 parties; and (2) whether the agreement covers the dispute. Cox v. Ocean View Hotel 14 Corp., 533 F.3d 1114, 1119 (9th Cir. 2008). If the answer to both questions is yes, the 15 FAA requires the court to enforce the arbitration agreement according to its terms. 16 Simula, Inc. v. Autoliv, Inc., 175 F.3d 716 , 719–20 (9th Cir. 1999). “Any doubts 17 concerning the scope of arbitrable issues should be resolved in favor of arbitration.” [18] Id. at 719 (citation modified). 19 IV. DISCUSSION 20 Stryker seeks to compel Manzano to arbitrate her claims against it based on the 21 Kelly Agreement. (Mot. 1–2.) Manzano does not dispute that the Kelly Agreement is 22 valid and enforceable as to Kelly and its clients, or that it covers wage-and-hour 23 claims that arose during her employment with Stryker through Kelly; indeed, she has 24 stipulated to arbitrate those claims with Kelly. (Opp’n 5.) However, Manzano 25 contends that Stryker cannot compel her to arbitrate her claims against Stryker here 26 because these claims are temporally independent of her employment with Kelly, and [27] 3 Stryker objects to portions of the Declaration of Nazo Koulloukian, filed in support of Manzano’s 28 opposition. (Defs.’ Evid. Objs., Dkt. No. 19-2.) The Court reaches its conclusions without relying on Koulloukian’s declaration. Accordingly, the Court overrules Stryker’s objections as moot. 1 they arise solely from her direct employment with Stryker. (Id. at 8.) Stryker argues 2 that it may compel Manzano to arbitrate under the Kelly Agreement either as a 3 third-party beneficiary or under the doctrine of equitable estoppel. (Mot. 12–18.) 4 A. Third-Party Beneficiary—Express & Intended 5 In California, a non-signatory may enforce an arbitration agreement against a 6 signatory when the non-signatory is a third-party beneficiary of the agreement. 7 Murphy v. DirecTV, Inc., 724 F.3d 1218, 1233 (9th Cir. 2013); Bouton v. USAA Cas. 8 Ins. Co., 167 Cal. App. 4th 412, 424 (2008). However, “[t]he mere fact that a contract 9 results in benefits to a third party does not render that party a ‘third party 10 beneficiary’”; rather, the parties to the contract must have intended the third party 11 would benefit. Murphy, 724 F.3d at 1234 (quoting Matthau v. Superior Ct., 151 Cal. 12 App. 4th 593, 602 (2007)). Stryker has not demonstrated such an intent with respect 13 to Manzano’s claims arising from her direct employment with Stryker. 14 Stryker claims it is an express third-party beneficiary of the Kelly Agreement, 15 because the Kelly Agreement requires the parties to arbitrate covered claims against 16 Kelly’s “clients or customers,” and Stryker is Kelly’s client. (Mot. 13–14 (quoting 17 Kelly Agreement § 1).) Stryker also argues it is an intended third-party beneficiary of 18 the Kelly Agreement, because Kelly hired Manzano specifically to work for Stryker, 19 making Stryker a “member of the class for whose benefit” the Kelly Agreement was 20 made. (Id. at 14–15.) 21 The Kelly Agreement requires arbitration for covered claims that arise between 22 Manzano and Kelly, its affiliates, and its “clients or customers.” (Kelly Agreement 23 § 1.) From May 22, 2023, to September 17, 2023, Stryker acted as Kelly’s “client” 24 when it employed Manzano through Kelly’s placement service. However, Manzano’s 25 temporary employment ended on September 17, 2023, and on September 18, 2023, 26 Stryker hired Manzano directly and ceased acting as Kelly’s client for purposes of 27 Manzano’s employment. Thus, as of the date Stryker hired Manzano directly, it ended 28 its entitlement to any express or intended benefit in the Kelly Agreement. 1 In this case, Manzano asserts claims against Stryker that arise distinctly from 2 her direct employment with Stryker. (Compl. ¶ 2 (limiting claims to the period from 3 September 18, 2023, through February 27, 2024).) It makes no difference that she 4 asserts the same labor law allegations in the PAGA action as she does here. The 5 PAGA claim against Kelly arose during her temporary employment with Kelly, to 6 which the Kelly Agreement applied. In contrast, the wage-and-hour claims against 7 Stryker here arise from Manzano’s direct employment with Stryker, to which the 8 Kelly Agreement does not apply. See Hughes v. S.A.W. Ent., Ltd., No. 16-cv-033719 LB, 2019 WL 2060769 , at *21–22, 27 (N.D. Cal. May 9, 2019) (temporally 10 distinguishing claims that arose during period covered by arbitration agreement from 11 the same claims to the extent they arose during period not covered by arbitration 12 agreement); Vaughn v. Tesla, Inc., 87 Cal. App. 5th 208 , 219–20 (2023) (same). 13 Thus, Manzano’s claims against Stryker here do not arise from her temporary 14 employment with Stryker in its role as Kelly’s “client” or intended beneficiary of the 15 Kelly Agreement. Stryker, as Manzano’s direct employer, is therefore not a 16 third-party beneficiary of the Kelly Agreement. 17 B. Equitable Estoppel 18 “The United States Supreme Court has held that a litigant who is not a party to 19 an arbitration agreement may invoke arbitration under the FAA if the relevant state 20 contract law allows the litigant to enforce the agreement.” Kramer v. Toyota Motor 21 Corp., 705 F.3d 1122, 1128 (9th Cir. 2013). Because generally “only signatories to an 22 arbitration agreement are obligated to submit to binding arbitration, equitable estoppel 23 of third parties in this context is narrowly confined.” Murphy, 724 F.3d at 1229 . 24 Under California law, a party that is not otherwise subject to an arbitration 25 agreement will be equitably estopped from avoiding arbitration only under two very 26 specific conditions: “(1) when a signatory must rely on the terms of the written 27 agreement in asserting its claims against the non-signatory or the claims are intimately 28 founded in and intertwined with the underlying contract,” and “(2) when the signatory 1 alleges substantially interdependent and concerted misconduct by the non-signatory 2 and another signatory and the allegations of interdependent misconduct are founded in 3 or intimately connected with the obligations of the underlying agreement.” Kramer, 4 705 F.3d at 1128–29 (citation modified) (citing Goldman v. KPMG, LLP, 173 Cal. 5 App. 4th 209, 218–19 (2009)). This rule reflects the policy that a plaintiff may not, 6 “on the one hand, seek to hold the non-signatory liable pursuant to duties imposed by 7 the agreement, which contains an arbitration provision, but, on the other hand, deny 8 arbitration’s applicability because the defendant is a non-signatory.” Murphy, [9] 724 F.3d at 1229 (quoting Goldman, 173 Cal. App. 4th at 220). 10 Stryker argues that equitable estoppel principles apply because Manzano’s 11 “claims against Stryker are intertwined with her Kelly employment.” (Mot. 17.) 12 However, Manzano raises claims against Stryker that are temporally distinct from her 13 Kelly employment. Prior to beginning her work as a Stryker employee on 14 September 18, 2023, Manzano completed her temporary Kelly employment on 15 September 17, 2023. (Cropper Decl. ¶ 10; Ali Decl. ¶ 27.) She asserts claims in this 16 action based solely in the time period beginning with her direct Stryker employment. 17 (Compl. ¶ 2.) Therefore, her claims against Stryker arose after she ended her 18 employment with Kelly and they are not rooted in her Kelly employment. See 19 Castillo v. Alere N. Am., Inc., No 3:21-cv-01519-RBM-SBC, 2023 WL 4630621 , 20 at *12–13 (S.D. Cal. July 19, 2023) (finding plaintiff’s claims arising from direct 21 permanent employment with defendants were not intertwined with claims arising 22 during temporary employment with a staffing agency). 23 Furthermore, Stryker ignores the requirement that Manzano must “rely on the 24 terms of the written agreement in asserting” her claims or her claims must be 25 “‘intimately founded in and intertwined with’ the underlying contract.” See Kramer, [26] 705 F.3d at 1128 (emphases added) (quoting Goldman, 173 Cal. App. 4th at 221). 27 Here, the only contract before the Court is the Kelly Agreement—a three-page 28 document that speaks only to the dispute resolution procedures should a dispute arise 1 || between Kelly and Manzano. (See generally Kelly Agreement.) Manzano’s claims are not “founded in,” do not require interpretation of, and are not “intertwined with” 3 || the terms of the Kelly Agreement. Kramer, 705 F.3d at 1128, 1129 . In California, 4|| equitable estoppel is inapplicable where a plaintiffs “allegations reveal no claim of 5 || any violation of any duty, obligation, term or condition imposed by the” agreement 6 || containing the arbitration clause. Murphy, F.3d at 1230 (quoting Goldman, 173 Cal. App. 4th at 230). Therefore, equitable estoppel does not permit Stryker to 8 | enforce the Kelly Agreement here. See Calzadillas v. Wonderful Co., No. 1:19-cv9 || 00172-DAD-JLT, 2019 WL 2339783 , at *7 (E.D. Cal. June 3, 2019) (declining to 10 || compel arbitration under equitable estoppel principles where plaintiffs labor violation 11 || claims did not depend on the terms of the only agreement before the court—the 12 | arbitration agreement). 13 Vv. CONCLUSION 14 For the reasons discussed above, the Court DENIES Stryker’s Motion to 15 || Compel Arbitration. (Dkt. No. 15). The Court will issue a scheduling order. [16] 17 IT IS SO ORDERED. [18] 19 December 4, 2025 OTIS D. HT, 33 UNITED STATES "DISTRICT JUDGE