89 Cal.App.5th 1129
Cal. Ct. App.2023Background
- Plaintiff Million Seifu, a former Lyft driver, sued under PAGA alleging Lyft misclassified drivers as independent contractors and violated multiple Labor Code provisions.
- Lyft’s Terms of Service required drivers to accept an arbitration agreement that (1) compelled individual arbitration and (2) contained a representative PAGA waiver precluding representative PAGA actions.
- The trial court denied Lyft’s motion to compel arbitration, relying on Iskanian (which treated PAGA representative waivers as unenforceable).
- This Court initially affirmed, but the United States Supreme Court granted certiorari, decided Viking River (limiting Iskanian), vacated and remanded for reconsideration.
- On remand, Seifu conceded his individual PAGA claim must be arbitrated under Viking River; the remaining dispute was whether he can maintain non‑individual (representative) PAGA claims in court after his individual claim is sent to arbitration.
- The Court of Appeal ordered Seifu’s individual PAGA claim compelled to arbitration but held he retains statutory standing under California law to pursue non‑individual PAGA claims in court and remanded for further proceedings (including consideration of a possible stay).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Seifu’s individual PAGA claim must be arbitrated | Seifu concedes Viking River requires arbitration of his individual PAGA claim | Lyft: arbitration clause enforceable as to individual PAGA claims | Reversed denial as to individual claim; Seifu must arbitrate his individual PAGA claim |
| Whether Seifu retains standing to pursue non‑individual (representative) PAGA claims in court after individual claim is sent to arbitration | Seifu: under California law (Kim et al.) he remains an “aggrieved employee” and retains standing to prosecute representative claims | Lyft: Viking River requires dismissal of non‑individual claims for lack of standing once individual claim is separated | Court rejects federal interpretation as binding; under Kim Seifu retains PAGA standing to pursue non‑individual claims in court; non‑individual claims not dismissed |
| Whether non‑individual PAGA claims should be stayed pending arbitration of the individual claim | Seifu opposed automatic stay | Lyft sought a stay under CCP §1281.4 | Trial court must decide in first instance; remanded for consideration of stay |
Key Cases Cited
- Viking River Cruises, Inc. v. Moriana, 142 S.Ct. 1906 (U.S. 2022) (FAA preempts some aspects of state-law restrictions on arbitration of PAGA; individual PAGA claims may be sent to arbitration)
- Iskanian v. CLS Transportation Los Angeles, LLC, 59 Cal.4th 348 (Cal. 2014) (California rule that representative‑PAGA waivers are contrary to public policy)
- Kim v. Reins International California, Inc., 9 Cal.5th 73 (Cal. 2020) (defines PAGA standing: plaintiff is an “aggrieved employee” if one or more alleged violations were committed against them)
- Arias v. Superior Court, 46 Cal.4th 969 (Cal. 2009) (PAGA deputizes employees as private attorneys general to recover civil penalties for Labor Code violations)
- Morehart v. County of Santa Barbara, 7 Cal.4th 725 (Cal. 1994) (discusses severance and finality of judgments; court explains limits of applying severance principles to standing in this context)