Nelson v. Service Corp. International CA4/1

Filed 7/29/13 Nelson v. Service Corp. International CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

CHERISE NELSON, D061861

Plaintiff and Appellant,

v. (Super. Ct. No. 37-2011-00101261-
CU-PA-CTL)
SERVICE CORPORATION
INTERNATIONAL, et al.,

Defendants and Respondents.

APPEAL from an order of the Superior Court of San Diego County, William H.

Kronberger, Jr., Judge. Affirmed.

Thomas & Solomon, Annette M. Gifford and Sarah E. Cressman for Plaintiff and

Appellant.

Gurnee & Daniels, John A. Mason; Stinson Morrison Hecker and Lonnie J.

Williams for Defendants and Respondents.

This appeal presents the unique situation where a former employee is seeking to

arbitrate her dispute with her former employer, and the employer refuses to arbitrate,

arguing the employee waived her contractual right to arbitrate. From May 2004 to
December 2004, Cherise Nelson was employed by a company involved in providing

funeral related services.1 As part of Nelson's employment, she signed an agreement

containing an arbitration clause that covered claims arising out of her employment.

Nelson elected to pursue potential class actions in federal court in Arizona instead

of demanding arbitration. These class actions concerned wage and hour claims stemming

from Nelson's employment from May 2004 to December 2004. After litigating for over

three years in these various actions, Nelson demanded arbitration against her former

employer and related entities. When the entities did not respond to the arbitration

demand, Nelson filed a petition to compel arbitration against SCI; CCFS; SCI Funeral

and Cemetery Purchasing Cooperative, Inc.; SCI Western Market Support Center, L.P.;

SCI California Funeral Services, Inc., Greenwood Memorial Park; Jane D. Jones; and

Thomas Ryan (collectively Respondents). The superior court denied Nelson's petition,

finding she had waived her right to arbitrate.

Nelson appeals, claiming the court erred in finding waiver. We determine

substantial evidence supports the court's finding of waiver and thus affirm.

FACTS AND PROCEDURAL HISTORY

In May 2004, Nelson began working at Greenwood Memorial Park in San Diego

County. As part of her employment, Nelson signed a document entitled "Principles of

1 The record is unclear what entity actually employed Nelson. Nelson alleged that
she was an employee of "Respondents" but later stated Service Corporation International
(SCI) was her employer. Respondents contend California Cemetery and Funeral
Services, LLC (CCFS) was Nelson's employer. The identity of the actual employer does
not impact our analysis here.
2
Employment and Arbitration Procedures" (the Agreement). The Agreement required the

parties to submit to arbitration any dispute regarding Nelson's employment. Further, the

Agreement provided that any claim must be brought "within one year of the date the

claiming party knew or should have known of the facts giving rise to the claim.

Otherwise the claim shall be deemed waived . . . ."

Nelson's employment with the company ended in December 2004.

On January 15, 2008, a purported class action lawsuit entitled Stickle v. Service

Corporation International, case No. 08-cv-PHX-MHM/JWS (Stickle) was filed in the

United States District Court of the District of Arizona. The plaintiffs asserted various

federal claims (including Fair Labor Standards Act (FLSA) violations related to the

nonpayment of purported overtime wages) against Respondents, except CCFS and SCI.

On February 8, 2008, Nelson filed her consent to become a named party in Stickle. In the

consent, Nelson stated that she was "seeking payment of unpaid wages under Federal or

State law, including overtime wages, and related relief against" her employer.

Nelson continued participating in the Stickle matter, focusing on obtaining class

certification. After over a year of litigation, the court in Stickle granted conditional

certification in September 2009.

Between September 30, 2009 (the date of the conditional certification) and

April 1, 2011, 665 additional filings were made in Stickle. Nelson's efforts to maintain

class certification ended on April 25, 2011 when the court granted Respondents' motion

for decertification of the conditionally certified class. Between September 30, 2009 and

April 1, 2011 (the date Respondents filed their motion to decertify), Respondents in

3
Stickle conducted discovery and prepared its motion to decertify. Over 60 depositions

were taken. Respondents also issued over 1,000 sets of interrogatories and reviewed over

740 answers to discovery. Because of incomplete interrogatory responses by the

plaintiffs in Stickle, Respondents filed motions to compel further responses, which the

court granted. Ultimately, Respondents filed a successful motion to decertify the class in

Stickle and the court dismissed the claims of all opt-in plaintiffs from the action.

In addition to her participation in Stickle, Nelson is a current opt-in plaintiff in

another federal proceeding in the Arizona District Court: Riggio v. Service Corporation

International, case No. 10-cv-01265-PHX-MHM/JWS (Riggio). On June 17, 2010,

Nelson filed her consent to become a party plaintiff in Riggio. Nelson admits that her

claims in Riggio mirror her claims in Stickle.2 Also, apparently the plaintiffs in Riggio

appealed the district court's dismissal of the action to the Ninth Circuit.

Nelson demanded arbitration against Respondents on April 1, 2011. After

Respondents did not respond to the demand, Nelson filed her petition to compel

arbitration in San Diego County Superior Court on November 17, 2011. In her petition,

she stated that she is seeking her "individual claims for unpaid overtime and other wages

and compensation . . . " under California law. Respondents filed answers to the petition

and subsequently opposed Nelson's petition.

2 Although the record is somewhat incomplete on this point, Nelson apparently was
an unnamed class member in another purported class action filed in the Northern District
of California: Bryant v. Service Corporation International, case No. 08-1190-SI
(Bryant).
4
 After considering the pleadings and hearing oral argument, the court denied

Nelson's petition. In doing so, the court noted: "In this Court's view the considerable

discovery, protracted Arizona proceedings, appeal and delay all combine in a way which

leads to the denial of this petition. Two lawsuits, prolonged proceedings, discovery and

an appeal all combine to require a denial."

Nelson timely appealed.

DISCUSSION

I

SUBSTANTIAL EVIDENCE SUPPORTS THE
SUPERIOR COURT'S FINDING OF WAIVER

Nelson asserts the court committed reversible error in denying her petition to

compel arbitration. Specifically, she contends Respondents did not meet their burden of

proving by a preponderance of the evidence that Nelson's state law claims were part of

the two federal actions. She also insists that her limited participation in the federal

actions was not inconsistent with her right to arbitrate.

A. Standard of Review

"Generally, the determination of waiver is a question of fact, and the court's

finding, if supported by evidence, is binding on the appellate court." (St. Agnes Medical

Center v. PacifiCare of California (2003) 31 Cal.4th 1187, 1196 (St. Agnes); see Augusta

v. Keehn & Associates (2011) 193 Cal.App.4th 331, 337 (Augusta) [applying substantial

evidence review to the issue of waiver of the right to arbitrate]; Burton v. Cruise (2010)

190 Cal.App.4th 939, 946 (Burton) [same].)

5
 However, relying on St. Agnes, supra, 31 Cal.4th 1187, Nelson argues that we

should apply a de novo standard of review because the question before us is whether the

superior court properly applied the correct legal standard to the undisputed facts. In St.

Agnes, our high court acknowledged, in reviewing an order denying a petition to compel

arbitration, " '[w]hen . . . the facts are undisputed and only one inference may reasonably

be drawn, the issue is one of law and the reviewing court is not bound by the trial court's

ruling.' " (Id. at p. 1196.) Thus, under St. Agnes, we will independently review the

court's order if there is only one inference that may reasonably be drawn from the

undisputed facts.

Because we determine the undisputed facts do not compel only one inference on

the record before us, we apply a substantial evidence standard of review. (See Augusta,

supra, 193 Cal.App.4th at p. 337; Burton, supra, 190 Cal.App.4th at p. 946.) The

superior court's "determination of [waiver], ' "if supported by substantial evidence, is

binding on an appellate court." ' [Citations.] Only ' "in cases where the record before the

trial court establishes a lack of waiver as a matter of law, [may] the appellate court . . .

reverse a finding of waiver made by the trial court." ' [Citation.]" (Adolph v. Coastal

Auto Sales, Inc. (2010) 184 Cal.App.4th 1443, 1450 (Adolph); Zamora v. Lehman (2010)

186 Cal.App.4th 1, 12 (Zamora).)

We imply all necessary findings supported by substantial evidence (Berman v.

Health Net (2000) 80 Cal.App.4th 1359, 1364 (Berman); Sobremonte v. Superior Court

(1998) 61 Cal.App.4th 980, 991-992 (Sobremonte)) and "construe any reasonable

6
inference in the manner most favorable to the judgment, resolving all ambiguities to

support an affirmance." (Burton, supra, 190 Cal.App.4th at p. 946.)

B. Arbitration and Waiver

Federal and state law reflects a strong public policy favoring arbitration as " ' "a

speedy and relative inexpensive means of dispute resolution." ' " (St. Agnes, supra, 31

Cal.4th at p. 1204; AT&T Mobility LLC v. Concepcion (2011) ___ U.S. ___, ___;

131 S.Ct. 1740, 1745.) Nonetheless federal and California courts may refuse to enforce

an arbitration agreement "upon such grounds as exist at law or in equity for the

revocation of any contract," including waiver. (9 U.S.C. § 2; see also Code Civ. Proc.,

§ 1281; St. Agnes, supra, 31 Cal.4th at pp. 1194-1195.) Based on the public policy

favoring arbitration, claims of waiver receive "close judicial scrutiny" and the "party

seeking to establish a waiver bears a heavy burden of proof." (Id. at p. 1195.)

"Although the statute[s and case law] speak[] in terms of 'waiver,' the term is used

' "as a shorthand statement for the conclusion that a contractual right to arbitration has

been lost." ' [Citation.] This does not require a voluntary relinquishment of a known

right; to the contrary, a party may be said to have 'waived' its right to arbitrate by an

untimely demand, even without intending to give up the remedy. In this context, waiver

is more like a forfeiture arising from the nonperformance of a required act. [Citations.]"

(Burton, supra, 190 Cal.App.4th at p. 944; see also Zamora, supra, 186 Cal.App.4th at

pp. 15-16 [federal law similarly uses the term waiver as a shorthand statement for the

conclusion a contractual right to arbitration has been lost].)

7
 Here, the arbitration provision declares that the arbitrator is to apply the laws of

the state in which Nelson was employed (California) and/or under federal law, if

applicable. Here, our analysis does not differ if we apply California or federal law. The

Federal Arbitration Act (9 U.S.C. § 1 et seq.) and the California Arbitration Act (Code

Civ. Proc., § 1280 et seq.) apply the same standards in determining waiver claims.

(Zamora, supra, 186 Cal.App.4th at p. 11.) "Both state and federal law emphasize that

no single test delineates the nature of the conduct that will constitute a waiver of

arbitration." (St. Agnes, supra, 31 Cal.4th at pp. 1195-1196.) In St. Agnes, the California

Supreme Court adopted as the California standard the same multifactor test employed by

federal courts for evaluating waiver claims. (Id. at p. 1196; Zamora, supra, at p. 15.)

Specifically, the court in St. Agnes identified the following as "factors [that] are

relevant and properly considered in assessing waiver claims": " ' "(1) whether the party's

actions are inconsistent with the right to arbitrate; (2) whether 'the litigation machinery

has been substantially invoked' and the parties 'were well into preparation of a lawsuit'

before the party notified the opposing party of an intent to arbitrate; (3) whether a party

either requested arbitration enforcement close to the trial date or delayed for a long period

before seeking a stay; (4) whether a defendant seeking arbitration filed a counterclaim

without asking for a stay of the proceedings; (5) 'whether important intervening steps

[e.g., taking advantage of judicial discovery procedures not available in arbitration] had

taken place'; and (6) whether the delay 'affected, misled, or prejudiced' the opposing

party." ' [Citations.]" (St. Agnes, supra, 31 Cal.4th at p. 1196.) No one of these factors

8
predominates and each case must be examined in context. (Burton, supra, 190

Cal.App.4th at pp. 944-945.)

C. Analysis

Here, the court found Nelson waived her right to arbitrate her claims by (1)

engaging in "considerable discovery"; (2) participating in the "protracted Arizona

proceedings"; (3) appealing the adverse ruling in Riggio; and (4) delaying her arbitration

demand. The court also found Nelson's delay in demanding arbitration and her

participation in the "Arizona litigation" prejudiced Respondents. These findings justify

the court's ruling and substantial evidence supports each finding. As such, we affirm the

superior court's waiver finding.

In its order denying Nelson's petition to compel arbitration, the court did not make

its findings within the context of the factors set forth in St. Agnes, supra, 31 Cal.4th 1187.

Nevertheless, the court's findings do correspond with several of the St. Agnes factors.

1. Unreasonable Delay

" '[A] demand for arbitration must not be unreasonably delayed. . . . [A] party

who does not demand arbitration within a reasonable time is deemed to have waived the

right to arbitration.' " (Sobremonte, supra, 61 Cal.App.4th at p. 992.) As the court

explained in Burton, "a party's unreasonable delay in demanding or seeking arbitration, in

and of itself, may constitute a waiver of a right to arbitrate." (Burton, supra, 190

Cal.App.4th at p. 945.)

"[A] party may [not] postpone arbitration indefinitely by delaying the

demand . . . . [¶] When no time limit for demanding arbitration is specified, a party must

9
still demand arbitration within a reasonable time. [Citation.] . . . '[W]hat constitutes a

reasonable time is a question of fact depending upon the situation of the parties, the

nature of the transaction, and the facts of the particular case.' " (Wagner Construction

Co. v. Pacific Mechanical Corp. (2007) 41 Cal.4th 19, 29-30.)

Here, there was considerable delay in Nelson demanding arbitration. Her

employment ended in December 2004. She did not demand arbitration until April 1,

2011, almost six and one-half years later. The record, however, is not clear when Nelson

first became aware or should have been aware of her wage and hour claims against

Respondents. At the very least, Nelson was aware of her claims against Respondents

when she filed her consent to become a named plaintiff in Stickles on February 8, 2008.3

Nevertheless, Nelson did not demand arbitration for over three years after becoming a

named plaintiff in Stickles. Surprisingly, Nelson offers no justification for this delay.

Nelson's failure to provide any justification or even an excuse makes this case one

of those rare instances where we would be satisfied that a party's unreasonable delay in

demanding arbitration by itself supports a finding of waiver. Nelson litigated her wage

and hour claims against Respondent, although predominately seeking to certify a class

and ultimately failing to do so, for three years prior to demanding arbitration. This

unexplained delay justifies a finding of waiver. (See Adolph, supra, 184 Cal.App.4th at

p. 1452 ["We are loathe to condone conduct by which a [litigant] repeatedly uses the

3 In her opening brief, Nelson tries to distinguish her federal wage and hour claims
from her state wage and hour claims. As we explain below, we find Nelson's arguments
unpersuasive.
10
court proceedings for its own purposes . . . all the while not breathing a word about the

existence of an arbitration agreement, or a desire to pursue arbitration . . . ."].)4 Simply

put, Nelson's delay undercuts the purpose of arbitration to provide a relatively quick and

cost-effective means to resolve disputes. (Moncharsh v. Heily & Blase (1992) 3 Cal.4th

1, 9.) Her failure to provide any explanation for at least a three-year delay in demanding

arbitration results in a waiver of her contractual right to arbitrate.

2. Conduct Inconsistent with an Intent to Arbitrate

"A waiver of the right to arbitrate may properly be implied from any conduct

which is inconsistent with the exercise of that right. [Citation.] Partial or piecemeal

litigation of issues in dispute, through pretrial procedures, may in many instances justify

a finding of waiver. . . ." (McConnell v. Merrill Lynch, Pierce, Fenner & Smith, Inc.

(1980) 105 Cal.App.3d 946, 951.) "The trial court must . . . view the litigation as a whole

and determine if the parties' conduct is inconsistent with a desire to arbitrate." (Id. at p.

952, fn. 2.)

4 Respondents note the Agreement contains a one-year time limit by which a party
must notify the other party of its claim in writing or the claim is waived. They assert
Nelson did not comply with this provision and a finding of waiver is proper under Platt
Pacific, Inc. v. Andelson (1993) 6 Cal.4th 307 (Platt). Platt is not determinative here
because unlike the arbitration agreement in Platt, the Agreement here does not explicitly
place a time limit by when a demand for arbitration must be made. (Id. at pp. 318-319.)
Instead, the Agreement addresses a time limit for notification of a claim. On the record
before us, we cannot determine if Nelson complied with this notification provision.
However, although we determine Platt to be distinguishable on the facts before us,
Nelson's conduct here appears to be at odds with the Agreement's notification provision
and the parties' apparent intent to efficiently and quickly resolve disputes through
arbitration. Further, this additional fact also makes Nelson's delay in demanding
arbitration all the more unreasonable.
11
 Here, the court found Nelson participated in two federal cases in the District of

Arizona involving her wage and hour claims and engaged in substantial discovery as part

of her litigation efforts. In addition, Nelson, as one of the plaintiffs in Riggio, appealed a

dismissal to the Ninth Circuit. We agree with the superior court that these facts show

conduct inconsistent with an intent to arbitrate. Moreover, each of the court's findings is

supported by substantial evidence.

Nelson does not dispute that substantial evidence supports these factual findings,

but argues that these facts do not support the conclusion that she acted inconsistently with

her right to arbitrate because the Arizona federal cases concerned claims under federal

law while she seeks to arbitrate only her claims under California law. We are not

persuaded.

Nelson contends the facts giving rise to the federal claims pursued in the Arizona

cases are factually and legally distinct from the California law claims she seeks to

arbitrate. For example, Nelson notes that the FLSA provides overtime pay for all hours

worked after 40 in one week while California law requires overtime pay after eight hours

of work in a single day. (Compare 29 U.S.C., § 207(a)(1) with Lab. Code, § 510.)

Nelson also points out that California law mandates that all hours worked in excess of 12

per day must be paid at double time, and the FLSA contains no analogous provision.

(See Cal. Code Regs., tit. 8, § 11040, subd. (3)(A)(1)(b).) Based on these differences,

Nelson insists "the facts necessary to establish California wage and hour claims differ

from the facts necessary to establish FLSA claims."

12
 Nelson's argument overlooks that both the FLSA and California law claims rely on

the same essential facts: Nelson's employment from May 2004 to December 2004, her

wages during this period, her break and meal times, the number of hours she worked, and

Respondents' employment policies. These core facts would then be applied to the

elements of a specific cause of action whether federal or state.5

In addition, Nelson's contention ignores the language of the Agreement. Under the

Agreement, "all disputes relating to any aspect of Employee's employment with the

Company shall be resolved by binding arbitration. This includes, but is not limited to,

any claims against the [employer], its affiliates or their respective officers, directors,

employees, or agents for breach of contract, wrongful discharge, defamation,

misrepresentation, and emotional distress . . . ." Moreover, the Agreement specifically

excluded "(1) any claims brought under federal discrimination laws (including Title VII

of the Civil Rights Act) or any federal laws [sic] administered by the Equal Employment

Opportunity Commission, (2) claims for workers' compensation or unemployment

benefits, or (3) claims brought to enforce any noncompetition or confidentiality

agreement which may exist between the parties." The Agreement did not remove claims

under the FLSA, and Nelson does not argue such. Thus, under the Agreement, both the

federal and state claims could have been arbitrated.

5 Nelson's argument that her federal wage and hour claims are different from her
state wage and hour claims also undermines any justification for delay. If the claims
were truly different, it raises the question: why did Nelson wait at least three years to
demand arbitration. Her failure to answer this question is telling.
13
 Further, when Nelson filed her consent to be a named plaintiff in both Arizona

cases, she indicated she was "seeking payment of unpaid wages under Federal or State

law" leaving open the question whether she would litigating her claims under California

law. The fact that Nelson sought to litigate a claim that was subject to arbitration and did

so over several years strongly supports the finding that Nelson acted inconsistently with

her right to arbitrate. Merely because she now claims she never pursued a state cause of

action in the Arizona cases does not render her conduct any less inconsistent with her

right to arbitrate because both her federal and state law claims are based on the same

basic facts.6

If Nelson intended to preserve her right to arbitrate, we would expect to see

something in the record to show this intent, perhaps a letter to opposing counsel, a

statement of claim, or an actual arbitration demand with a request to stay pending the

outcome of the federal class actions. Here, there is no such evidence in the record.

Instead, Nelson remained silent about arbitration and litigated her wage and hour claims

against Respondents as a purported class member for over three years. It appears that she

6 Nelson insists that waiver can only be found if it is established that the party
seeking arbitration previously litigated the exact same claims that party now seeks to
arbitrate. Thus, she concludes her litigation of federal wage and hour claims does not bar
her arbitration of state wage and hour claims. However, she cites no California authority
for this proposition. The federal cases Nelson does cite do not compel the adoption of
this bright line rule in employment litigation allowing a plaintiff to split federal and state
wage and hour claims that are based on the same employment, conduct, and policies.
(See generally Microstrategy, Inc. v. Lauricia (4th Cir. 2001) 268 F.3d 244; Subway
Equipment Leasing Corp. v. Forte (5th Cir. 1999) 169 F.3d 324; Doctor's Associates, Inc.
v. Distajo (2d Cir. 1997) 107 F.3d 126.) Further, our high court was clear that no single
test applies to a determine whether a contractual right to arbitrate has been waived. (See
St. Agnes, supra, 31 Cal.4th at pp. 1195-1196.)
14
only demanded arbitration when it was clear Respondents would move to decertify the

conditional class. Simply put, there is nothing in Nelson's conduct that indicates an intent

to arbitrate and her actions suggest a desire to litigate her claims in federal court instead

of arbitration.

3. Prejudice

" 'In California, whether or not litigation results in prejudice also is critical in

waiver determinations.' [Citation.] 'The moving party's mere participation in litigation is

not enough; the party who seeks to establish waiver must show that some prejudice has

resulted from the other party's delay in seeking arbitration.' [Citation.]" (Augusta, supra,

193 Cal.App.4th at p. 340; St. Agnes, supra, 31 Cal.4th at p. 1203.)

"[C]ourts assess prejudice with the recognition that California's arbitration statutes

reflect ' "a strong public policy in favor of arbitration as a speedy and relatively

inexpensive means of dispute resolution" ' and are intended ' "to encourage persons who

wish to avoid delays incident to a civil action to obtain an adjustment of their differences

by a tribunal of their own choosing." ' [Citation.] Prejudice typically is found only

where the petitioning party's conduct has substantially undermined this important public

policy or substantially impaired the other side's ability to take advantage of the benefits

and efficiencies of arbitration." (St. Agnes, supra, 31 Cal.4th at p. 1204.) In Burton, the

court explained "a petitioning party's conduct in stretching out the litigation process itself

may cause prejudice by depriving the other party of the advantages of arbitration as an

'expedient, efficient and cost-effective method to resolve disputes.' [Citation.]" (Burton,

supra, 190 Cal.App.4th at p. 948.)

15
 "[C]ourts will not find prejudice where the party opposing arbitration shows only

that it incurred court costs and legal expenses." (St. Agnes, supra, 31 Cal.4th at p. 1203.)

But courts " 'may consider . . . the expense incurred by that party from participating in the

litigation process' " and the length of delay as factors bearing on whether the opposing

party has been prejudiced. (Sobremonte, supra, 61 Cal.App.4th at p. 995.) "[T]he critical

factor in demonstrating prejudice is whether the party opposing arbitration has been

substantially deprived of the advantages of arbitration as a ' " 'speedy and relatively

inexpensive' " ' means of dispute resolution. [Citation.]" (Burton, supra, 190

Cal.App.4th at p. 948.)

Here, substantial evidence supports the trial court's finding that Nelson prejudiced

Respondents by delaying her arbitration demand for at least three years and litigating

class claims in multiple courts, including one appeal. The parties engaged in substantial

discovery, involving more than 60 depositions and extensive written discovery.

Respondents successfully moved to compel further discovery responses. (See Hoover v.

American Income Life Ins. Co. (2012) 206 Cal.App.4th 1193, 1205 (Hoover) ["Prejudice

sufficient for waiver will be found where instead of seeking to compel arbitration, a party

proceeds with extensive discovery that is unavailable in arbitration proceedings."].)

Respondents filed pleadings to oppose conditional certification of a class in Stickles and

subsequently moved to decertify the conditional certification. Nelson's arbitration

demand coincided with Respondents' effort to decertify the conditional class. "[Nelson's]

actions substantially impaired [Respondents'] ability to obtain the cost savings and other

16
benefits provided by arbitration." (Ibid.; see Adolph, supra, 184 Cal.App.4th at pp. 1451-

1452.)

Nelson contends Respondents were not prejudiced because she did not attempt to

litigate her state law claims. We reject this argument for the same reasons we discuss

above: Nelson's wage and hour claims, whether based in federal or state law, emanate

from the same basic facts.

Nelson also insists Respondents' participation in the federal class action cases for

three years actually benefited not prejudiced them because "Nelson and the other

employees who were part of that action lost the benefits of proceeding collectively."

Nelson fails to consider that while Respondents were mired in three years of class action

litigation in federal court, they were denied their bargained for benefit of arbitration of

Nelson's claims. This denial was the result of Nelson's and other employees' conduct and

decision to pursue a class action in federal court. The fact that Nelson's efforts ultimately

proved unsuccessful does not somehow lessen the prejudicial impact of her actions. Her

actions whether successful or unsuccessful denied Respondents the benefits of arbitration

and allowed her to take advantage of discovery to which she would not have been entitled

to in arbitration. (See Hoover, supra, 206 Cal.App.4th at p. 1205; see Adolph, supra, 184

Cal.App.4th at pp. 1451-1452.)

Finally, we are not persuaded by Nelson's assertion that her participation in the

Arizona cases did not prejudice Respondents because other former employees were

involved in those cases and Respondents would have had to defend the litigation in any

event. Nelson sought the advantage of litigating her wage and hour claims against

17
Respondents as part of a purported class. Had she been successful, she would have

benefited from being part of the class. Indeed, at oral argument, Nelson's counsel

admitted had the class remained certified, Nelson would not have sought arbitration. Her

efforts proved unsuccessful, however, and she cannot now hide behind the fact that other

plaintiffs participated in the actions to avoid the consequence of her decision: prejudice

to Respondents resulting in the waiver of her contractual right to arbitrate.

D. Conclusion

In summary, the record before us does not establish a lack of waiver as a matter of

law. (See Adolph, supra, 184 Cal.App.4th at p. 1450.) We are satisfied substantial

evidence supports the court's finding of waiver.

DISPOSITION

The order is affirmed. Respondents are awarded their costs of appeal.

HUFFMAN, Acting P. J.

WE CONCUR:

HALLER, J.

AARON, J.

18