[00:00:03] Speaker 02:
All right, we have one more of these this morning.

[00:00:05] Speaker 02:
This one is CoCom versus ABM Aviation.

[00:00:11] Speaker 02:
And Mr. Fears, are you?

[00:00:16] Speaker 04:
Yes.

[00:00:17] Speaker 02:
All right.

[00:00:17] Speaker 02:
Mr. Fears is here.

[00:00:18] Speaker 02:
He's going to be starting us off.

[00:00:22] Speaker 02:
Mr. Bello, can you go ahead and unmute for a second and make sure we can hear you?

[00:00:27] Speaker 03:
Yes, sir.

[00:00:27] Speaker 03:
Good morning.

[00:00:28] Speaker 02:
Yeah, I can hear you fine.

[00:00:29] Speaker 02:
So we'll

[00:00:31] Speaker 02:
Now you can mute back up again if you want to, and we'll start off with Mr. Fears.

[00:00:36] Speaker 02:
State your name and how much time you hope to reserve for rebuttal.

[00:00:40] Speaker 04:
Thank you, Your Honor.

[00:00:41] Speaker 04:
Daniel F. Fears on behalf of ABM Aviation, and I'm accompanied by Brian Shaw, my colleague.

[00:00:48] Speaker 04:
I would say if I could reserve four minutes at the end, that would be sufficient.

[00:00:53] Speaker 02:
Everybody's doing different times.

[00:00:54] Speaker 02:
It makes it hard for me to remember.

[00:00:55] Speaker 02:
All right, go ahead.

[00:00:56] Speaker 04:
All right.

[00:00:58] Speaker 04:
May it please the Court, we're here today

[00:01:01] Speaker 04:
on the district court's denial of a motion to compel arbitration and a motion to strike the class waiver that is in the arbitration agreement.

[00:01:14] Speaker 04:
And where I will start is that, as we briefed, there is a strong public policy, federal law and state law,

[00:01:24] Speaker 04:
favoring arbitration.

[00:01:27] Speaker 04:
And the FAA obviously provides the federal guideline, and state court law provides the state guideline.

[00:01:37] Speaker 04:
In this matter, there's basically three issues that we have.

[00:01:42] Speaker 04:
First, whether or not the arbitration agreement, the ABM's arbitration agreement is substantively unconscionable.

[00:01:52] Speaker 04:
There's also a procedural unconscionability issue

[00:01:55] Speaker 04:
as well, but whether the agreement is unconscionable.

[00:01:58] Speaker 04:
Secondly, to the extent that there is any unconscionable term in the agreement, whether it can be severed out pursuant to the severability clause that is in that agreement.

[00:02:11] Speaker 04:
And then third, if for any reason the agreement was deemed unconscionable and couldn't be enforced and couldn't be cured through severance, whether or not the

[00:02:25] Speaker 02:
uh... class let me give you two stands alone it seems to me in this case uh... this case uh... it all a lot of it in this in my view turns on whether or not maybe all of it turns on uh... whether or not you interpret this is only applied to employment-related claims as i think you argue or whether or not you interpret as applying to all claims and a lot of other things derived from that a lot of the other arguments and and the uh...

[00:02:52] Speaker 02:
Your colleagues on the other side's best argument is the language that says including but not limited to claims arising and or relating in any way.

[00:03:04] Speaker 02:
So including but not limited to.

[00:03:07] Speaker 02:
That's your big problem.

[00:03:08] Speaker 02:
I think if you can overcome that language, and this is interpreted as applying to employment only, a lot of the other issues, the duration, if it's only employment, then duration is going to depend on

[00:03:22] Speaker 02:
on that.

[00:03:22] Speaker 02:
So that – why should we not read – not limit it to – I'm a textualist.

[00:03:31] Speaker 04:
Fair enough.

[00:03:32] Speaker 04:
I agree that the other issues are collateral.

[00:03:36] Speaker 04:
Once that issue of whether or not this applies beyond employment agreements, if that is resolved in favor of ABM, then the other issues go by the way the duration mutuality

[00:03:48] Speaker 04:
Yes, so so two points on that your honor and I'll start with the easiest one first Unfortunately, the district court did not apply the Ramirez to case the California Supreme Court case on severability and there is a severability clause in this agreement and instead the court the district court relied upon an intermediary court of appeal the cook case and

[00:04:18] Speaker 04:
Um, which is factually different from this case, but the standard used for severability, if the, if the language of the agreement is over brought out, but not limited to, that's all you got to do, line that out.

[00:04:33] Speaker 04:
Exactly.

[00:04:33] Speaker 02:
They're, they're in, in the, in the preamble there, there's claims arising related to hiring, employment or association.

[00:04:41] Speaker 04:
Correct.

[00:04:42] Speaker 04:
In the preamble, there are six words and in paragraph a, there are six words, both going to the same topic.

[00:04:48] Speaker 04:
And specifically in the preamble, it's including but not limited to those.

[00:04:53] Speaker 04:
And in paragraph A, it is including but not limited to claims.

[00:04:57] Speaker 04:
If those were deleted, to accomplish the lawful purpose- Get rid of including, right?

[00:05:01] Speaker 02:
Like, you could leave including in there.

[00:05:04] Speaker 04:
You would, because in A, it would say any claim that the company has against me, et cetera, arising and or relating to, in any way, my hiring, employment, or association with.

[00:05:17] Speaker 02:
You would not need the including but not limited to claims in paragraph A. Now you do have some cases that involve not exactly the same type of language but arguably similar language and in those cases the courts did not sever.

[00:05:34] Speaker 02:
I'm trying to remember their intermediate court of appeals.

[00:05:36] Speaker 04:
Well the primary one that was relied upon by the court and by

[00:05:40] Speaker 04:
the appellee in this case is the Cook case, Cook versus USC.

[00:05:45] Speaker 04:
And that case was, it's a perfect example of bad facts making bad law, because that case specifically said whether or not the dispute arises out of employment.

[00:05:58] Speaker 04:
So it's very clear that the intent of that, when you write whether or not, that's not loose language, unlike a couple of clauses here that say including but not limited to.

[00:06:11] Speaker 01:
What was the intent then of the not including but not limited to language?

[00:06:17] Speaker 04:
In ABM's contract?

[00:06:19] Speaker 04:
I think, as far as I can tell, because ABM has a history of using this contract for 10 plus years,

[00:06:26] Speaker 04:
and it's always been in the employment context.

[00:06:30] Speaker 04:
It's never intended to use outside, and if you look at the language and the rules of construction, the i justem generis and nositura socius, that you look at the specifics of what is in the contract, and the only specifics that are in this contract are employment-related

[00:06:50] Speaker 04:
claims, hiring, compensation, end of employment, employment.

[00:06:56] Speaker 04:
So when you look at the specific under rules of construction, you're supposed to focus on the specific and not a generality.

[00:07:03] Speaker 04:
And so, Your Honor,

[00:07:05] Speaker 04:
I was not there when it was drafted.

[00:07:07] Speaker 04:
It wasn't my document.

[00:07:09] Speaker 04:
But somebody threw in some loose language, I think.

[00:07:12] Speaker 04:
It's almost a throat clearing.

[00:07:14] Speaker 00:
Employers, right?

[00:07:15] Speaker 00:
We want to make sure that we haven't overlooked anything.

[00:07:18] Speaker 04:
Maybe they were paid by the word, Your Honor.

[00:07:19] Speaker 04:
I don't know.

[00:07:20] Speaker 04:
But sometimes loose language gets in there.

[00:07:23] Speaker 04:
But if you look at the essence of this contract, and if the court looks at the Ramirez 2 decision that we've cited, the California Supreme Court, which

[00:07:35] Speaker 04:
the district court is supposed to look to for issues regarding cyber-ability?

[00:07:40] Speaker 02:
I think there seems to be three answers to Judge Tomey's question.

[00:07:43] Speaker 02:
One is somebody decided to include this because they were thinking, I want to go outside the employment context, right?

[00:07:49] Speaker 02:
Clearly, but not limited to could be.

[00:07:51] Speaker 02:
That was what they were thinking.

[00:07:52] Speaker 02:
And I think that another would be just lawyers putting in legalese, just like what Judge Tomey was kind of referring to here.

[00:08:04] Speaker 02:
And the other, I suppose, it would be a worry that some clever employees lawyer finds a way to characterize an employment claim, what we would all probably conceive to be as a non-employment claim.

[00:08:22] Speaker 02:
And so think, well, you better not, you can't get around our language here by cleverly characterizing an employment claim as a non-employment claim.

[00:08:31] Speaker 02:
That would be, so it would be one of those three things.

[00:08:33] Speaker 02:
And it seems to me on,

[00:08:35] Speaker 02:
on the latter two favors you, and the first one favors the other side.

[00:08:41] Speaker 04:
Yeah, I would agree that those are the possibilities, Your Honor.

[00:08:46] Speaker 04:
But one has to look at the context of the agreement as well.

[00:08:49] Speaker 04:
This is not an arbitration agreement that's contrary to the principles announced by the California Supreme Court in Armanderas, where it's just substantively flawed and it's an overreach

[00:09:03] Speaker 04:
And it's tainted with illegality, as the Ramirez II case said.

[00:09:07] Speaker 04:
And the California Supreme Court in that case, the 2024 case said, if the purpose of the agreement is tainted with illegality, then that's a problem in terms of severance.

[00:09:20] Speaker 04:
But if it's not, then you look to the agreement.

[00:09:23] Speaker 04:
You say, one, can language be excised?

[00:09:26] Speaker 02:
So the severance argument and the interpretive arguments

[00:09:32] Speaker 02:
There are some similarities, but not exactly similar.

[00:09:36] Speaker 02:
And I'm trying to figure out, if we were to conclude that it was the first interpretation, that we think this was included in order to include non-employment claims, could we still then sever?

[00:09:54] Speaker 02:
to address your severance argument.

[00:09:55] Speaker 02:
I'm trying to figure out if your severance argument is different, because if we conclude it's the second or third of my three options I gave, which are including but not limited to was only meant because of bad drafting or to include employment type claims that might not quite be labeled as employment, then I don't know why we'd need to sever.

[00:10:18] Speaker 02:
We would just

[00:10:19] Speaker 02:
we would just read it, you know, we'd say that's probably what it means.

[00:10:21] Speaker 02:
But if, if, if we concluded that it actually meant to include non-employment claims, the broad, you know, the, the, your, your colleagues on the other side's argument, then wouldn't we, could we, could we conclude that and then just decide to sever it?

[00:10:37] Speaker 02:
Because that would be kind of contrary to the intent.

[00:10:40] Speaker 02:
But maybe we'd cover it because we'd say, maybe we'd still sever it because we'd say, well, we didn't give the drafters everything they wanted because part of what they wanted was

[00:10:48] Speaker 02:
was improper, and the FAA tells us to save these things.

[00:10:52] Speaker 02:
And I think California law tells us to save when we can.

[00:10:55] Speaker 02:
That's what your California Supreme Court.

[00:10:56] Speaker 04:
Yes.

[00:10:57] Speaker 04:
And to respond to your question, if it was category number one, door number one, where some nefarious lawyer was trying to overreach or something, or include some language that was a little too broad,

[00:11:11] Speaker 04:
even though there's no record of that, there's no record that somebody intended that, and we're perfectly willing to strike that from this agreement because that's not the intent, and in fact, in this particular dispute.

[00:11:23] Speaker 02:
But we're assuming it's the intent.

[00:11:24] Speaker 04:
It's a wage-an-hour dispute, and it's an employment dispute in this case.

[00:11:28] Speaker 02:
You're going to answer the way you framed it.

[00:11:30] Speaker 02:
You said assuming it was their intent.

[00:11:32] Speaker 04:
Yeah, assuming it was their intent, then that is the whole purpose behind severability.

[00:11:37] Speaker 04:
For instance, in any contract where someone makes a mistake

[00:11:41] Speaker 04:
and assumes that a certain, in this case.

[00:11:47] Speaker 02:
My question is, if they didn't make a mistake, if they really want to do this thing that you can't do, right, that California law don't let you do, do you sever?

[00:11:55] Speaker 02:
And so let's assume that's not a mistake.

[00:11:58] Speaker 02:
We have a contract that says we want to do A, B, and C. B and C you can't do under, or let's just say C you can't do under California law.

[00:12:06] Speaker 02:
Then even if they really want to do C, you say California policy is,

[00:12:11] Speaker 02:
and contracts is to sever C and keep A and B. Yes.

[00:12:15] Speaker 02:
Even if you really did want to do the nefarious C that California law says is bad.

[00:12:20] Speaker 04:
Yes.

[00:12:21] Speaker 04:
But in this case, I would say that it's not even nefarious because this contract that came about at least nine or 10 years ago.

[00:12:29] Speaker 02:
I realize you're pushing back on the table.

[00:12:31] Speaker 04:
There's no clear law that said it was nefarious if that was the intent.

[00:12:35] Speaker 02:
Well, if you don't mind, I'm trying to keep us on track.

[00:12:38] Speaker 02:
You want to keep four minutes, and we're down to 320.

[00:12:41] Speaker 02:
and you're going to have say if you want to say in response to the other side.

[00:12:44] Speaker 02:
So unless my colleagues have more questions in opening, can I have you sit down and we'll hear from the other side?

[00:12:49] Speaker 02:
Yes.

[00:12:49] Speaker 04:
Thank you very much.

[00:12:51] Speaker 02:
Thank you.

[00:12:51] Speaker 02:
Thank you.

[00:12:52] Speaker 02:
Thank you.

[00:12:52] Speaker 02:
Thank you.

[00:12:56] Speaker 03:
Mr. Bello.

[00:12:58] Speaker 03:
Good morning, Your Honor.

[00:12:58] Speaker 03:
It's Jordan Bello on behalf of Robert Coke on the Pelly.

[00:13:02] Speaker 03:
I don't know if you wanted me to just start in on the language.

[00:13:06] Speaker 02:
You know, I was talking to you even though I was talking the other side.

[00:13:10] Speaker 02:
I really do think

[00:13:11] Speaker 02:
this, and I don't know if my colleagues agree with me, they don't always sadly, but I really do think that this whole thing comes down to, let me ask you then, what do you think if we are to interpret this language that contractors being limited to employment claims, do you still win?

[00:13:33] Speaker 02:
Or does that, you know, my reading, my thinking was if we interpret as employment claims, a lot of the, a lot of the latter arguments, a lot of the other factors sort of get driven by that.

[00:13:42] Speaker 02:
For instance, your duration argument that these are infinite duration.

[00:13:46] Speaker 02:
Well, they're not really infinite duration at their employment claims because once the person quits and the statute of limitation runs, there's no more employment claims.

[00:13:52] Speaker 02:
There's kind of a built in duration.

[00:13:55] Speaker 02:
And I think some of the other things are like that too.

[00:13:57] Speaker 02:
So maybe you can help me out initially here by

[00:14:01] Speaker 02:
Why would you still win if I was to interpret this as being limited to employment?

[00:14:07] Speaker 02:
And then we can come back to whether I should interpret it that way.

[00:14:12] Speaker 03:
We would still win.

[00:14:13] Speaker 03:
I think it does.

[00:14:14] Speaker 03:
Once you take away the scope issue, it does, I guess, lighten the duration issue.

[00:14:22] Speaker 03:
But this also does extend to a broad scope of third parties.

[00:14:26] Speaker 02:
Yeah, but that's explained by, and I think there's some California cases that in the employment context are just as an inherent symmetry.

[00:14:33] Speaker 02:
that employees tend to sue their employer and everybody else, you know, their boss, their their boss's boss and and the parent company and all that stuff.

[00:14:42] Speaker 02:
And so that also sort of is relevant even to that.

[00:14:44] Speaker 02:
As I read it, they're all kind of.

[00:14:47] Speaker 00:
And you sued a hundred John Doe's.

[00:14:52] Speaker 00:
Yeah, in addition to ABM.

[00:14:55] Speaker 03:
That's just part of, but we sued ABM Aviation.

[00:14:57] Speaker 00:
The agreement that they made them sign was with ABM Industries, which has numerous- Which is why you have an expansive definition of what the employer or the company is in order to cover just this situation.

[00:15:11] Speaker 00:
Is it not, counsel?

[00:15:13] Speaker 03:
Yes, but this goes beyond the company, its affiliates, parents, employees.

[00:15:18] Speaker 03:
It includes vendors, any third party vendors,

[00:15:24] Speaker 02:
So it's going to depend on the fact that it's an employee employment type claims, then you could sue a vendor.

[00:15:31] Speaker 02:
You could sue a vendor if it was not an employment time.

[00:15:33] Speaker 02:
Some of your hypotheticals you gave in your briefing about this is egregious.

[00:15:36] Speaker 02:
You couldn't sue a vendor if the vendor you bought something independently from them in your in your capacity as a private citizen.

[00:15:44] Speaker 02:
But but again, that's that's not a concern if it's if it's interpreted as only applying to employment type claims.

[00:15:51] Speaker 02:
So I kind of go back to my question.

[00:15:53] Speaker 03:
Well, I would go back.

[00:15:55] Speaker 03:
Why would they include the third parties, including vendors, if it's limited to employment claims?

[00:16:01] Speaker 02:
And so if we go back, if we want to go back to the trucker backs over you, you know, while you're loading things, you know, try a third party, third party vendor that sells stuff, they back over you and you.

[00:16:13] Speaker 02:
So you sue everybody, you know, because of that.

[00:16:16] Speaker 02:
That's employment related, but it's it's it involves a vendor.

[00:16:21] Speaker 03:
And that's where I would say it depends how broad, if it is even limited to claims that arise from employment.

[00:16:29] Speaker 03:
If you get in a dispute with a coworker, you guys both happen to get gassed at the same gas station, you get assaulted.

[00:16:35] Speaker 03:
Is it because the dispute arose in employment, you're now have to be arbitrating claims against someone that assaulted you at the gas station?

[00:16:45] Speaker 03:
You know, so it can be, even if it was limited to employment claims, it doesn't automatically.

[00:16:52] Speaker 02:
There might be tough line drawing problems, whether it's employment or not related, but I really am trying to figure out how much of your claim, putting my cards on the table, I think that the employment thing kind of decides this case.

[00:17:07] Speaker 02:
It all kind of comes down to whether we interpret this contract as only including employment and not.

[00:17:13] Speaker 00:
What if you had named the payroll processing vendor?

[00:17:16] Speaker 00:
I mean, you've got a wage claim here and there was some problem with regard to the wage statement.

[00:17:22] Speaker 00:
Wouldn't that be subject to arbitration under this agreement?

[00:17:26] Speaker 03:
Yeah, I would think so.

[00:17:29] Speaker 03:
I would, but I so that is if you're asking for possibilities when you might sue a vendor, you are raising one.

[00:17:38] Speaker 03:
If we go to the broader and we say if you're just focusing on the cook, but we also have the argument that there's a public injunction waiver.

[00:17:45] Speaker 03:
I would argue even if you just have that, I think the Ramirez case said I think they had an example for severance that the agreement in that

[00:17:56] Speaker 02:
There were excluding claims that I think Hodges, I think it was Hodges in which I was on.

[00:18:02] Speaker 02:
So I thought Hodges said that you don't, you know, you don't kind of come up with hypothetical situations that aren't presented in your case in order to try to find unconscionability.

[00:18:11] Speaker 02:
So this public conjunctive relief argument that the district, I believe the lower court didn't reach or one of them, it didn't read, maybe it reached this one, but not the Paga, but these things that if, if, um, you know,

[00:18:25] Speaker 02:
your client doesn't have a public conjunctive relief claim.

[00:18:28] Speaker 03:
Well, that misinterprets unconscionability law.

[00:18:31] Speaker 03:
So California unconscionability law is focused.

[00:18:33] Speaker 02:
I know that's your argument, but I thought we have case law on that, like, right directly on point case law in Hodges, I believe.

[00:18:40] Speaker 03:
Well, Hodges and McGill didn't involve unconscionability.

[00:18:43] Speaker 03:
They involved whether or not a

[00:18:47] Speaker 03:
A public injunction waiver barred the claims in that case.

[00:18:53] Speaker 03:
And because it was the Cruz Broughton rule, and then it turned into the McGill rule, but it was based on 3 civil code 3513, whether which doesn't look to like unconscious ability.

[00:19:08] Speaker 03:
Look at the hypotheticals and look at that.

[00:19:10] Speaker 02:
The McGill rule is not implicated when the plaintiff's complaint does not seek public injunctive relief.

[00:19:17] Speaker 02:
At least some of that has quotes around it in what Mike.

[00:19:19] Speaker 03:
Right.

[00:19:20] Speaker 03:
But the McGill rule is, but that's not an unconscionability argument.

[00:19:25] Speaker 03:
So, in other words, that both of those cases were limited to the McGill rule as if it's illegal to waive public injunction.

[00:19:35] Speaker 02:
We did say in Hodges that court should not, quote, stretch to invalidate contracts based on hypothetical issues that are not actually presented in the party's dispute.

[00:19:43] Speaker 02:
That sure sounds like what you're asking us to do.

[00:19:47] Speaker 03:
Well, not not because we're arguing unconscious completely different theory.

[00:19:52] Speaker 03:
So if unconscious ability is issue, we don't have the statute saying and the case law Ramirez v. Superior Court, the California Supreme Court, noting that you look at the beginning of when they was formed and you don't look at these post.

[00:20:10] Speaker 03:
Circumstances that happen.

[00:20:11] Speaker 03:
So I would argue.

[00:20:13] Speaker 03:
McGill was under a different statute.

[00:20:16] Speaker 03:
It does note that you can't do it, but that doesn't apply to an unconscionability analysis.

[00:20:21] Speaker 02:
California law- I do agree with you that the public injunctive relief argument, which I think I'm remembering now the district court did reach, and then PAGA suits, which it did not, and the bar on using arbitration awards as precedent, those all would be independent of the employment.

[00:20:42] Speaker 02:
aspect.

[00:20:42] Speaker 02:
And so then the question would just be if somehow those three things, um, which the district court didn't reach most of those.

[00:20:50] Speaker 02:
Let me ask you, let me, let me ask you probably a question that, uh, that's related to the employment thing.

[00:20:54] Speaker 02:
You know, you heard me talk about and, and, and, and feel free to push back on my characterization here, but it seems like that language, um, that, uh, that including, but not limited to claims arising to, uh, out of

[00:21:08] Speaker 02:
And then the list is all employment stuff.

[00:21:10] Speaker 02:
It seems there's three ways that that could be what could have been meant by that.

[00:21:15] Speaker 02:
And you heard what my three ways were.

[00:21:16] Speaker 02:
I can repeat them if you want.

[00:21:17] Speaker 02:
But why should we interpret it that what they meant was but not limited to what was intended or what that language means is super broad?

[00:21:31] Speaker 03:
Because I think it is I think it was intended to be I think you look at the language of the clause and for example, you start with the structure of the sentence language used and it shows they were intending to have a broad scope agreement.

[00:21:45] Speaker 02:
I know there's a lot of cases best argument is, but not limited to sounds really.

[00:21:50] Speaker 02:
That's your best argument.

[00:21:51] Speaker 02:
It's just a pure text.

[00:21:53] Speaker 03:
I'm a little less... But it's not... Sorry, Your Honor, it is not just... We start, they define it, a covered claim is to the maximum extent permissible pursuant to federal law.

[00:22:04] Speaker 02:
Does that sound like a attempt to narrowly define... Not that that helps so much because I think as far as whether it's... That sort of begs the question, because if it was meant to be employment, they want it to be employment,

[00:22:18] Speaker 02:
to the max extent permissible, which would kind of explain, actually, why they included not limited to, because my point about not trying to get around a deployment claim by characterizing it something else is, by characterizing it something else.

[00:22:30] Speaker 02:
And these other, you know, these Latin phrase things, how do you say, Judge Tung's one.

[00:22:39] Speaker 02:
That one, yeah.

[00:22:41] Speaker 02:
Those all are telling you to basically look at the context, right?

[00:22:45] Speaker 02:
And when I look at the context,

[00:22:47] Speaker 02:
Every time it actually talks about anything specific, it is employment.

[00:22:50] Speaker 02:
That seems to bear in favor of the other side's interpretation of this.

[00:22:54] Speaker 01:
And counsel, you have, just piggybacking off of Judge Van Dyke's question, there is a provision in the contract that says the arbitration shall be conducted pursuant to the AAA employment arbitration rules.

[00:23:07] Speaker 01:
So doesn't that evince an intent that the contract is about employment claims and not anything else?

[00:23:14] Speaker 03:
I would disagree.

[00:23:15] Speaker 03:
I've had, and I don't have the cases offhand, but there's case law that has employment agreements that apply the consumer AAA rules.

[00:23:23] Speaker 03:
It's just a selection of arbitration rules.

[00:23:26] Speaker 03:
That doesn't define the scope of the agreement.

[00:23:29] Speaker 03:
And I, again, I would go through this.

[00:23:31] Speaker 02:
Counsel, it may not be decisive, but if what we're looking at rarely are contextual arguments decisive.

[00:23:36] Speaker 02:
And what I'm just struggling with is that you take what Judge Tong just referred to, you take the fact that any time this thing talks about anything specific,

[00:23:44] Speaker 02:
I think literally any time it actually gets into the weeds, it is all employment related.

[00:23:49] Speaker 02:
And what you have against that, I think, is just but not limited to the natural capaciousness of that language.

[00:23:59] Speaker 02:
Do you, what else do you have?

[00:24:01] Speaker 02:
Okay.

[00:24:01] Speaker 03:
Your honor, let, let me go through it.

[00:24:03] Speaker 03:
So again, I know you're discounting it, but to the maximum extent, permissible pursuant to federal law.

[00:24:08] Speaker 03:
I think if it's intended to be limited to employment claims, it's clear that that's going to be covered.

[00:24:13] Speaker 03:
But I think that phrase is intending to say that we're going to try and move as broad as possible.

[00:24:18] Speaker 03:
Then it starts with any claim, right?

[00:24:21] Speaker 03:
Any, any claim.

[00:24:22] Speaker 03:
They've given examples of citing a bunch of cases that do it differently, that just say arising out of the employment relationship.

[00:24:32] Speaker 03:
They could have easily done that they chose not to do that.

[00:24:35] Speaker 03:
Then they include the term including, but not limited to this is textually that that to me.

[00:24:41] Speaker 03:
I mean, if we want to try and that why else would you include that including, but not limited to I know you're giving 2 options, but I don't think those options.

[00:24:53] Speaker 03:
Apply here, you know, just like cook the USC, just like, um, I think we in our FRAP 28 J letter, there's gardener.

[00:25:02] Speaker 03:
There's, um, uh, I'm sorry.

[00:25:05] Speaker 02:
I mean, you do agree that the cook's language specifically.

[00:25:11] Speaker 02:
says in addition has language that refers to something outside of employment.

[00:25:16] Speaker 02:
I agree.

[00:25:18] Speaker 03:
I would just say that it's common at least before Cook that companies were trying to have these broad clauses, arbitration clauses that can reach as broad as possible and under California

[00:25:31] Speaker 03:
public policy that when you're going too broad beyond the scope of the relationship, that's unfair under our public policy.

[00:25:39] Speaker 03:
Obviously, anecdotally, everyone thinks to the Disney World case where someone signed a two-week trial, Disney Plus, and Disney was willing to try and use that in a wrongful death suit against the husband.

[00:25:55] Speaker 03:
We're trying to limit that here.

[00:25:56] Speaker 03:
Again, I would also say,

[00:25:58] Speaker 03:
As pointed out by the judge.

[00:26:00] Speaker 00:
Council, why can't the problem be resolved by excising six words from two provisions in the contract?

[00:26:09] Speaker 03:
I think if you're asking me, can it be excised just in the, you know, can it be excised?

[00:26:19] Speaker 03:
I would say yes.

[00:26:21] Speaker 00:
Preamble and the arbitration clause.

[00:26:24] Speaker 03:
Let me do one more point before we move on to that, because that goes more towards severability.

[00:26:30] Speaker 03:
But there's also, as the trial point pointed out, there's a carve out for currently pending in litigation, any claims currently pending in litigation.

[00:26:42] Speaker 03:
And ABM states in their Tamata declaration, the company's been presenting this to new employees.

[00:26:47] Speaker 02:
I don't quite, that seems to be easily correct.

[00:26:50] Speaker 02:
I'm working for somebody.

[00:26:52] Speaker 02:
I go get another job.

[00:26:53] Speaker 02:
I come back to work for them.

[00:26:54] Speaker 02:
And so they're wanting to make, you know, that it's not, yeah, that could be covering employment also, right?

[00:27:00] Speaker 02:
You know, try to make sure that if there's an employment claim, sorry, existing, because you previously worked for us that we're going to cover that.

[00:27:06] Speaker 03:
Yeah, but I think it's broader.

[00:27:07] Speaker 03:
I think obviously textually, including but unlimited to these are drafted.

[00:27:11] Speaker 02:
I know you're got about a minute left.

[00:27:13] Speaker 02:
I want to make sure Judge Talman, you get to Judge Shama severability question.

[00:27:16] Speaker 03:
the question that wasn't the answer that wasn't raised.

[00:27:20] Speaker 03:
It is not just can we do it is is the question is, is it an abuse of discretion for the court not to do it?

[00:27:27] Speaker 03:
And so it's within the courts discretion.

[00:27:30] Speaker 03:
Can they do it or the Ramirez case goes through step by step?

[00:27:34] Speaker 03:
They could do it for deterrent reasons, even if they can do it, that whether they should do it and.

[00:27:41] Speaker 03:
Here, the court felt that it permeated the agreement

[00:27:44] Speaker 03:
uh, specifically found that it was intended to advantage the employer and give an inferior form and forum for the, um, plaintiff.

[00:27:54] Speaker 03:
And that's well within its discretion to look at these, consider the, uh, the unconscionable terms.

[00:28:00] Speaker 03:
And it's not an abusive discretion.

[00:28:02] Speaker 03:
It's within its discretion.

[00:28:04] Speaker 02:
All right.

[00:28:05] Speaker 02:
Well, do you have any other questions?

[00:28:07] Speaker 02:
No, we really appreciate it's been very helpful.

[00:28:08] Speaker 02:
And I feel like we've focused in on these issues that, um, that I

[00:28:13] Speaker 02:
that I'm focused on in this case.

[00:28:15] Speaker 02:
I think your counsel on the other side has three minutes for rebuttal.

[00:28:20] Speaker 04:
Thank you.

[00:28:21] Speaker 04:
Just a few words, Your Honor.

[00:28:22] Speaker 04:
I think to sum it up, the essence of this agreement is intended to arbitrate employment agreements.

[00:28:28] Speaker 04:
Everything about it, all the nuances and the specifics go to employment-related disputes.

[00:28:34] Speaker 04:
At most, there are those six words that hypothetically could expand it, but

[00:28:41] Speaker 04:
That certainly is not the overriding purpose.

[00:28:44] Speaker 04:
And as mentioned under Ramirez 2, the court said, unless the overall purpose of the agreement is illegality.

[00:28:53] Speaker 04:
And this is a standard kind of employment agreement to arbitrate disputes for all the reasons that have been discussed today.

[00:29:02] Speaker 02:
The abuse of discretion is probably your biggest challenge with that because, and I guess,

[00:29:08] Speaker 02:
Your counsel said it's abuse of discretion.

[00:29:11] Speaker 02:
I think that's right.

[00:29:12] Speaker 02:
The standard for review for severability.

[00:29:14] Speaker 04:
It is.

[00:29:15] Speaker 04:
But where the error is, and where the abuse of discretion clearly is, is the district court used a standard of if there's more than one unconscionable provision, then we can't sever.

[00:29:28] Speaker 04:
And that's where Ramirez II, the Supreme Court, specifically said,

[00:29:33] Speaker 04:
I'm quoting, here we clarify that no bright line rule requires a court to refuse enforcement if a contract has more than one unconscionable term.

[00:29:43] Speaker 04:
So the Supreme Court has ruled that in essence the standard that was used at the district court is just legally wrong.

[00:29:53] Speaker 04:
And then secondly, the court went on to say that the question on severability is,

[00:29:59] Speaker 04:
If you can excise it without rewriting the contract, then the only question is, do the interests of justice call for it?

[00:30:08] Speaker 04:
And the interests of justice clearly do.

[00:30:10] Speaker 04:
This is an arbitration agreement that was entered into.

[00:30:12] Speaker 04:
It's fairly standard.

[00:30:14] Speaker 04:
And it's favored by both FAA law as well as California law.

[00:30:20] Speaker 02:
Any other questions from my colleagues?

[00:30:22] Speaker 02:
All right.

[00:30:22] Speaker 02:
Well, thank you, counsel.

[00:30:23] Speaker 02:
Thank you to both counsel.

[00:30:24] Speaker 02:
All the arguments have been very helpful this morning.

[00:30:26] Speaker 02:
And that wraps up our week.

[00:30:28] Speaker 02:
Thank you very much.