Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 1 of 8
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`No. C 19-07545 WHA
`Related to
`No. C 19-07646 WHA
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`ORDER RE MOTION TO COMPEL
`ARBITRATION, MOTION TO STAY
`PROCEEDINGS, AND MOTION TO
`SEAL
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`TERRELL ABERNATHY, et al.,
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`Petitioners,
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`v.
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`DOORDASH, INC.,
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`Respondent.
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`CHRISTINE BOYD, et al.,
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`Petitioners,
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`v.
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`DOORDASH, INC.,
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`Respondent.
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`INTRODUCTION
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`In this labor classification action, petitioners seek to compel arbitration. Respondent
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`moves to stay the proceedings pending preliminary and final approval of a class settlement in a
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`state action. For the reasons stated below, petitioners’ motion to compel is GRANTED IN PART
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`and is otherwise DENIED. Respondent’s motion to stay is DENIED.
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`Northern District of California
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 2 of 8
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`STATEMENT
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`Petitioners are 5,879 couriers who work for respondent, DoorDash, Inc. In order to make
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`deliveries for respondent, petitioners allegedly each clicked through a contract that contained a
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`“Mutual Arbitration Provision,” that required among other things, that each petitioner and
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`respondent “mutually agree to this Mutual Arbitration Provision, which is governed by the
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`Federal Arbitration Act (9 U.S.C. §§ 1-16) (“FAA”) and shall apply to any and all disputes
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`arising out of or relating to this Agreement, [including] CONTRACTOR’s classification as an
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`independent contractor” and required the arbitrations to be administered by the American
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`Arbitration Association (AAA). The agreement also provided that the parties “mutually agree
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`that by entering into this agreement to arbitrate, both waive their right to have any dispute or
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`claim brought, heard or arbitrated as, or to participate in, a class action, collective action and/or
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`representative action . . . .” In turn, AAA’s Commercial Arbitration Rules require each
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`individual to pay a filing fee of $300 and the responding company to pay a filing fee of $1,900.
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`Petitioner couriers say they have been improperly classified as independent contractors
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`rather than employees. Accordingly, in August 2019, petitioners’ counsel filed individual
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`demands for arbitration with the AAA on behalf of 2,250 individuals (Abernathy petitioners)
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`claiming violations of statutes such as the Fair Labor Standards Act and the California Labor
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`Code. In September 2019, petitioners’ counsel filed further demands on behalf of 4,000 more
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`individuals with the AAA (Boyd petitioners) making the same claims. Petitioner couriers paid
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`over $1.2 million in filing fees. AAA then imposed a deadline of October 28 for respondent
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`DoorDash to pay its share of the fees for the Abernathy arbitrations and a deadline of
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`November 7 for the Boyd arbitrations (Keller Decl. ¶¶ 12, 17–21). On October 28,
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`respondent’s counsel emailed AAA and petitioners’ counsel stating they had “determined that
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`there are significant deficiencies with the claimants’ filings,” and that “Doordash is under no
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`obligation to, and will not at this time, tender to AAA the nearly $12 million in administrative
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`fees.” On November 8, AAA emailed the parties and stated, “Respondent has failed to submit
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`the previous requested fees for the 6,250 individual matters; accordingly, we have
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`administratively closed our files” (Keller Decl. Exs. L, N).
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`Northern District of California
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`United States District Court
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 3 of 8
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`On November 15, petitioner couriers commenced this action to compel arbitration for the
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`Abernathy petitioners (Case No. C 19-07545 WHA) and moved for a temporary restraining
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`order a few days later. On November 19, additional petitioners (through the same counsel)
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`sought to compel arbitration in the Superior Court of California for the Boyd petitioners.
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`Respondent then removed the Boyd action here (Case No. C 19-07646 WHA). All cases
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`wound up before the undersigned judge.
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`A hearing ensued on the motion for temporary restraining order as to the Abernathy
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`petitioners on November 25. DoorDash had begun to require couriers, in order to sign in for
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`new work, to click through a new agreement that required arbitration with the International
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`Institute for Conflict Prevention & Resolution (CPR), instead of AAA. At the hearing,
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`however, respondent DoorDash represented that couriers could opt out of the new arbitration
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`agreement, and instead continue to arbitrate under AAA if they so desired, so petitioners
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`withdrew their motion for temporary restraining order.
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`Meanwhile, in 2018, some couriers had filed a class action (through different counsel) in
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`the Superior Court of California, County of San Francisco, alleging respondent had willfully
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`misclassified its couriers. Marciano v. DoorDash, Inc, No. CGC-18-567869 (S.F. Super. Ct.
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`Dec. 7, 2018). A class settlement was recently pending preliminary approval there. Some of
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`the unnamed class members in the class action are petitioners in the instant actions. Although
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`the underlying legal issues are dissimilar to those for the motion to compel here, any petitioner
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`who accepts the Marciano settlement will release the claims that would be arbitrated here.
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`Petitioners’ counsel here filed a brief there on behalf of proposed intervenors to object to the
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`Marciano settlement. On January 30, 2020, the Marciano court vacated the hearing on the
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`motion for preliminary approval of the settlement and designated the action as a complex case
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`(Dkt. No. 168-1, Ex. L).
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`Herein, petitioner couriers have now filed an amended motion to compel arbitration with
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`the AAA which seeks to compel arbitration on behalf of 5,879 individuals. Respondent
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`separately moves to stay the motion to compel pending the preliminary and final approval of
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`the settlement agreement in Marciano. This order follows full briefing and oral argument.
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`Northern District of California
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`United States District Court
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 4 of 8
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`1.
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`MOTION TO COMPEL ARBITRATION.
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`ANALYSIS
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`Under the Federal Arbitration Act, a district court determines “whether a valid arbitration
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`agreement exists and, if so, whether the agreement encompasses the dispute at issue.”
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`Lifescan, Inc. v. Premier Diabetic Servs., Inc., 363 F.3d 1010, 1012 (9th Cir. 2004). If the
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`court is satisfied “that the making of the agreement for arbitration or the failure to comply
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`therewith is not in issue, the court shall make an order directing the parties to proceed to
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`arbitration in accordance with the terms of the agreement.” 9 U.S.C. § 4.
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`Here, petitioners contend (and respondent does not dispute) that at least 5,010 petitioners
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`have signed declarations attesting to “click[ing] through” DoorDash’s AAA arbitration
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`agreement. As stated above, the agreement provides that the parties “mutually agree to this
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`Mutual Arbitration Provision, which is governed by the Federal Arbitration Act (9 U.S.C. §§ 1-
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`16) (“FAA”) and shall apply to any and all disputes arising out of or relating to this
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`Agreement, [including] CONTRACTOR’s classification as an independent contractor . . . .”
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`Significantly, the agreements for these 5,010 petitioners are valid, cover the claims in suit, and
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`require arbitration before the AAA.
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`There are 869 petitioners that DoorDash argues do not have a valid agreement with
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`DoorDash. Instead of submitting declarations for these petitioners, petitioners’ counsel
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`submitted mere “witness statements” in which they stated, among other things, their residential
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`address, the amount of time they have worked for DoorDash, and that they did not recall opting
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`out of arbitration. The November order, however, specifically asked petitioners to provide a
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`declaration setting forth “the identifying information he or she used to register with DoorDash”
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`and “at least referencing in an ascertainable way the specific arbitration he or she clicked
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`through.” The submitted witness statements do not provide such information and without
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`them, this order cannot conclude that an arbitration agreement exists as to those petitioners.
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`DoorDash has also raised questions as to the authority of petitioners’ counsel to represent
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`certain other petitioners and seek relief on their behalf. While the factual requisites have been
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`satisfied to compel arbitration as to 5,010 petitioners, these specific procedural disputes are
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 5 of 8
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`referred to the AAA for decision. If it turns out that Keller Lenkner has overstated its
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`authority, or for any procedural reason, petitioners have not perfected their right to arbitrate,
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`this order imposes on Keller Lenkner a requirement to fully reimburse DoorDash for all
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`arbitration fees and attorney’s fees and expenses incurred by DoorDash in defending the
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`arbitration, and the arbitrator shall so award them.
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`The motion to compel arbitration is GRANTED as to the 5,010 petitioners who submitted
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`declarations. DoorDash is ordered to immediately commence AAA arbitration with these
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`petitioners. The motion is DENIED as to the 869 petitioners who submitted mere witness
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`statements.
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`Petitioner couriers have further requested that respondent pay all attorney’s fees and costs
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`related to the arbitration under California Senate Bill 707, which took effect on January 1,
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`2020. In relevant part, the law states:
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`In an employment or consumer arbitration that requires, either
`expressly or through application of state or federal law or the rules
`of the arbitration administrator, the drafting party to pay certain
`fees and costs before the arbitration can proceed, if the fees or
`costs to initiate an arbitration proceeding are not paid within 30
`days after the due date, the drafting party is in material breach of
`the arbitration agreement, is in default of the arbitration, and
`waives its right to compel arbitration under Section 1281.2.
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`It further states that if the above occurs, the employee may: “(1) Withdraw the claim from
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`arbitration and proceed in a court of appropriate jurisdiction (2) Compel arbitration in which
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`the drafting party shall pay reasonable attorney’s fees and costs related to the arbitration” Cal.
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`Civ. Proc. Code § 1281.97. The law also states “[t]he court shall impose a monetary sanction
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`against a drafting party that materially breaches an arbitration agreement pursuant to
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`subdivision (a) of Section 1281.97 or subdivision (a) of Section 1281.98, by ordering the
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`drafting party to pay the reasonable expenses, including attorney’s fees and costs, incurred by
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`the employee or consumer as a result of the material breach.” Cal. Civ. Proc. Code § 1281.99.
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`“A retrospective operation will not be given to a statute which interferes with antecedent
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`rights . . . unless such be ‘the unequivocal and inflexible import of the terms, and the manifest
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`intention of the legislature.’” United States v. Security Industrial Bank, 459 U.S. 70, 78–79
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 6 of 8
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`(1982). Senate Bill 707 does not apply retroactively and here, the events at issue all occurred
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`prior to the enactment of the bill. See Cal. Civ. Proc. Code § 1281.97; S.B. 707, 2019-2020
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`Reg. Sess. (Cal. 2019). Petitioners began to file their individual demands for arbitration in
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`August 2019. Following respondent’s failure to pay the necessary fees, AAA closed all of the
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`petitioners’ files in November 2019. The underlying demands for arbitration and
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`corresponding fee payment requirements are thus not currently pending before AAA.
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`Petitioners’ request for relief under California Senate Bill 707 is accordingly DENIED.
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`2.
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`MOTION TO STAY.
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`Respondent DoorDash seeks to stay the instant proceedings until final approval of the
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`Marciano settlement given, among other things, the potential overlap between the petitioners
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`here and the class members in Marciano. Ironically, DoorDash originally sought to dismiss
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`Marciano on the ground that the couriers had a duty to arbitrate. Petitioners’ counsel then
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`sought to do exactly that. Their clients want individual arbitrations before AAA and this Court
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`accordingly expects all petitioner couriers here to opt out of the class action in Marciano — if
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`it ever gets preliminary and final approval. If it turns out that any petitioners attempt to double
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`dip (get both class action relief and individual arbitration), then this order recommends the
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`arbitrator impose on Keller Lenkner an order to fully reimburse DoorDash for all arbitration
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`fees and attorney’s fees and expenses incurred by DoorDash in defending the matter twice. As
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`to DoorDash’s concern regarding CenturyLink and the possibility that petitioners here may
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`prefer the Marciano settlement, this order reminds Keller Lenkner that it would be a serious
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`problem to assert that the firm has attorney-client privilege with a DoorDash courier who has
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`not authorized Keller Lenkner to represent him or her, or to initiate arbitration on behalf of a
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`petitioner without his or her informed consent. That said, the motion to stay is DENIED.
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`This order notes a concern that the proposed Marciano settlement seeks to prevent opt
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`outs via petitioners’ counsel and instead requires an original ink signature by each individual.
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`This provision is an obvious attempt to make it as hard as possible for petitioners to opt out,
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`thus binding them to the Marciano settlement. Perhaps the judge overseeing the proposed
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`settlement will give this provision extra scrutiny.
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 7 of 8
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`3.
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`MOTION TO SEAL.
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`Petitioners have filed an unopposed motion to file under seal certain portions of their
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`reply brief, Aaron Zigler’s declaration, and the exhibits attached to Aaron Zigler’s declaration.
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`CPR has designated these materials as confidential purporting that they contain, among other
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`things, trade secrets, proprietary information, and sensitive information. The materials sought
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`to be sealed here all relate to email communications between CPR and respondent’s counsel,
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`Gibson Dunn, in 2019. In short, the emails track the following events: in May 2019, Gibson
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`Dunn reached out to CPR to discuss issues DoorDash was having with filing fees for mass
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`arbitrations, and to find a solution to prevent “an abuse of process.” In October 2019, CPR
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`provided Gibson Dunn with a draft of a mass arbitration protocol for discussion. A week later,
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`CPR provided Gibson Dunn with another draft of the protocol based on their discussion.
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`Gibson Dunn “interlineated comments, questions, and recommendations” in the new draft.
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`CPR and Gibson Dunn traded additional drafts and revisions in the following weeks. On
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`November 4, CPR notified Gibson Dunn that it had posted the finalized new protocol and
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`asked to be notified when the new DoorDash contracts providing for arbitration under CPR
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`were distributed. Just because such information has been designated as confidential does not
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`mean that it deserves to be kept from the public once filed in the federal district court. The
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`district court should not be a party to concealing this information from the public, especially as
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`it concerns an arbitration organization that holds itself out to the public as impartial. These
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`documents would be useful to the public in evaluating the true extent to which the organization
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`is impartial. The motion to seal is accordingly DENIED.
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`CONCLUSION
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`For decades, the employer-side bar and their employer clients have forced arbitration
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`clauses upon workers, thus taking away their right to go to court, and forced class-action
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`waivers upon them too, thus taking away their ability to join collectively to vindicate common
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`rights. The employer-side bar has succeeded in the United States Supreme Court to sustain
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`such provisions. The irony, in this case, is that the workers wish to enforce the very provisions
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`forced on them by seeking, even if by the thousands, individual arbitrations, the remnant of
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`Case 3:19-cv-07646-WHA Document 91 Filed 02/10/20 Page 8 of 8
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`procedural rights left to them. The employer here, DoorDash, faced with having to actually
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`honor its side of the bargain, now blanches at the cost of the filing fees it agreed to pay in the
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`arbitration clause. No doubt, DoorDash never expected that so many would actually seek
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`arbitration. Instead, in irony upon irony, DoorDash now wishes to resort to a class-wide
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`lawsuit, the very device it denied to the workers, to avoid its duty to arbitrate. This hypocrisy
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`will not be blessed, at least by this order.
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`This order now gives any party who disagrees with the unsealing order 14 CALENDAR
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`DAYS to seek relief with our court of appeals. Failing any relief, petitioners’ reply brief, Aaron
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`Zigler’s declaration, and the exhibits appended to the declaration shall be made public. For 14
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`calendar days, the documents sought to be sealed shall remain under seal. This order,
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`however, shall be public ab initio.
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`Dated: February 10, 2020.
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`WILLIAM ALSUP
`UNITED STATES DISTRICT JUDGE
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