Tallman v. Eighth Judicial Dist. Court of State

359 P.3d 113

131 Nev. Adv. Op. 71

Dennis TALLMAN, Individually and on Behalf of Others Similarly Situated, Petitioner

v.The EIGHTH JUDICIAL DISTRICT COURT OF the STATE of Nevada, in and for the COUNTY OF CLARK;

and the Honorable Susan Johnson, District Judge, Respondents

and

CPS Security (USA), Inc.;

and CPS Construction Security Plus, Inc., Real Parties in Interest.

Donald Mika;

and Beryl Harter, Individually and on Behalf of Others Similarly Situated, Petitioners

v.

The Eighth Judicial District Court of the State of Nevada, in and for the County of Clark;

and the Honorable Susan Johnson, District Judge, Respondents

and

CPS Security (USA), Inc.;

and CPS Construction Security Plus, Inc., Real Parties in Interest.

Nos. 60673

61390.

Supreme Court of Nevada.

Sept. 24, 2015.

Leon Greenberg Professional Corporation and Leon M. Greenberg, Las Vegas, for Petitioners.

Kamer Zucker Abbott and Carol Davis Zucker and Timothy W. Roehrs, Las Vegas, for Real Parties in Interest.

Before the Court En Banc.

OPINION

By the Court, PICKERING, J.:

Petitioners Donald Mika, Beryl Harter, and Dennis Tallman seek writs of mandamus directing the district court to vacate its orders compelling arbitration of their claims against their former employer, real party in interest CPS Security (USA), Inc., and certain of its agents and associates (collectively, CPS). All three petitioners signed the same long-form arbitration agreement, which includes a clause waiving the right to initiate or participate in class actions. They urge this court to invalidate the agreement, first, because it was not countersigned by CPS and, second, because its class action waiver assertedly violates state and federal law. Petitioner Tallman also maintains that CPS waived its right to compel arbitration by litigating with him in state and federal court. The district court acted properly in compelling individual arbitration of petitioners' claims. We therefore deny writ relief.

I.

A.

CPS provides security services to construction companies in Nevada and elsewhere. Petitioners worked 50 to 70 hours per week for CPS as trailer guards. As a condition of their employment, CPS required petitioners to sleep overnight in small trailers located at its work sites. CPS did not pay petitioners for their sleep time except when they were called out to respond to an alarm or other activity at the site. Petitioners allege, and CPS denies, that they are owed at least the minimum wage for the required on-site sleep time, whether called out during the night or not, as well as overtime pay.

Petitioners signed both short- and long-form arbitration agreements with CPS. The short-form agreement is entitled “Arbitration Agreement (Outside CA)” and includes concise language assenting to binding arbitration and providing that it can only be modified “by a written instrument executed by EMPLOYEE and Chris Coffey, on behalf of the COMPANY.” The long-form agreement is entitled “Offer to Participate in Arbitration of Disputes” and is much more detailed. It specifies that arbitration shall be conducted pursuant to the JAMS Employment Arbitration Rules at a location convenient to the employee and provides for a written award, judicial review of the award, and for CPS to bear the costs of arbitration, including the arbitrators' fees.

The long-form arbitration agreement includes a clause entitled “Waiver of Right to Initiate or Participate in Collective or Class Actions.” This clause states that, “The Arbitrator shall not consolidate Claims of different employees into one proceeding, nor shall the Arbitrator have the power to hear arbitration as a class action.” It continues:

By entering into this Agreement, the Company [ (CPS) ] and I are agreeing to waive rights we might otherwise have including, but not limited to, the rights (a) to initiate representative actions, collective actions, and/or class actions; and (b) to participate in representative actions, collective actions, or class actions initiated by others.

The long-form agreement also includes an acknowledgment that CPS “is engaged in transactions involving interstate commerce[ and] that the employment relationship between us affects interstate commerce.”

The long-form agreement has two signature pages. Each of the petitioners signed both pages of his or her long-form agreement. The first signature page of the long-form agreement also includes a signature line for CPS, which CPS left blank and never signed. The second and final signature page is set up for only the employee to sign. It contains three paragraphs, all in capital letters, headed “VOLUNTARY AGREEMENT,” “RIGHT TO CONSULT COUNSEL,” and “30 DAY PERIOD TO OPT–OUT.” The paragraph headed “OPT–OUT” acknowledges “THAT I WAS ADVISED

THAT CHOOSING TO SIGN THIS AGREEMENT IS NOT A CONDITION OF MY EMPLOYMENT,” and that “I HAVE BEEN GIVEN A COPY OF MY SIGNED AGREEMENT AND HAVE A FULL THIRTY (30) DAY PERIOD TO OPT–OUT OF THE AGREEMENT IF I CHANGE MY MIND.”

B.

Tallman sued CPS in state court, asserting minimum wage and overtime claims individually and on behalf of others similarly situated under Nevada law, NRS Chapter 608, and the federal Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201 –219 (2014). CPS removed Tallman's complaint to federal court, which retained jurisdiction of the FLSA claims but declined to exercise supplemental jurisdiction over, and therefore remanded, the Nevada-law-based claims. Thereafter, Mika and Harter filed a second state court suit against CPS. Their complaint, also styled as a class action, reasserts Tallman's NRS Chapter 608 claims against CPS but adds new defendants and civil racketeering claims under NRS Chapter 207. The two suits were assigned to the same district court judge who, after briefing and argument, entered orders compelling individual arbitration of Tallman's, Mika's, and Harter's claims and denying their motions for class certification. It is from these orders that Tallman, Mika, and Harter seek extraordinary writ relief.

II.

Nevada has adopted the Uniform Arbitration Act of 2000 (UAA). NRS 38.206 to 38.248. Consistent with its policy favoring efficient and expeditious enforcement of agreements to arbitrate, see NRS 38.219 ; D.R. Horton, Inc. v. Green, 120 Nev. 549, 553, 96 P.3d 1159, 1162 (2004), the Act authorizes interlocutory appeals from orders denying arbitration but makes no provision for interlocutory appeals of orders compelling arbitration. NRS 38.247(a)(1). We have said that the reason for not allowing interlocutory appeals of orders compelling arbitration is “obvious”: “[I]f at the very threshold of the proceeding the defaulting party could appeal and thereby indefinitely delay the matter of arbitration, the object of the law [favoring arbitration] and the purpose of the written agreement of the parties would be entirely defeated.” Clark Cnty. v. Empire Elec., Inc., 96 Nev. 18, 20, 604 P.2d 352, 353 (1980) (internal quotations omitted) (addressing an earlier version of the UAA).

Since petitioners have no immediate right of direct appeal, they ask this court to exercise original mandamus jurisdiction over the district court's orders compelling arbitration. Mandamus affords interlocutory appellate review in cases “where there is not a plain, speedy and adequate remedy in the ordinary course of law.” NRS 34.170. The petitioners assume, and CPS accepts, that they have no “plain, speedy and adequate remedy” besides mandamus because NRS 38.247(a)(1) does not provide for direct, interlocutory appeals from compelling arbitration. See also Kindred v. Second Judicial Dist. Court, 116 Nev. 405, 409, 996 P.2d 903, 906 (2000) (reviewing an order compelling arbitration on a writ of mandamus and “conclud[ing] that [petitioner] has no remedy available other than that provided by a writ”). But error in ordering arbitration may be reviewed on appeal from the final judgment or order confirming or vacating the award, see NRS 38.247 ; Clark Cnty. v. Empire Elec., Inc., 96 Nev. at 20, 604 P.2d at 353, eventual appellate review that the Uniform Arbitration Act deems adequate and appropriate. See In re Gulf Exploration, LLC, 289 S.W.3d 836, 841–43 (Tex.2009) (discussing the tension between mandamus review of orders compelling arbitration and “the legislative preference for moving cases to arbitration quickly” evident in the Uniform Arbitration Act's withholding a right of direct interlocutory appeal of such orders). Thus, the party seeking extraordinary writ relief from an order compelling arbitration still should show why an eventual appeal does not afford “a plain, speedy and adequate remedy in the ordinary course of law,” NRS 34.170,¹ and that the matter meets the other criteria for extraordinary writ relief, i.e., that mandamus is needed “to compel the performance of an act that the law requires or to control a manifest abuse of discretion” by the district court. State ex rel. Masto v. Second Judicial Dist. Court, 125 Nev. 37, 43–44, 199 P.3d 828, 832 (2009) (also emphasizing that “the decision to entertain” a petition for mandamus challenging an order compelling arbitration is not automatic, but a matter “addressed solely to our discretion”).

The parties do not meaningfully address the requirements for extraordinary writ relief in their briefs. We nonetheless accept mandamus review of the petitions before us for two reasons. First, our case law may have invited the parties to assume that the lack of a right of interlocutory direct appeal made mandamus readily available.See supra note 1; Kindred, 116 Nev. at 409, 996 P.2d at 906 ; cf. Pan v. Eighth Judicial Dist. Court, 120 Nev. 222, 228, 88 P.3d 840, 843–44 (2004) (although concluding that appeal, not mandamus, is the appropriate vehicle to review orders dismissing actions on forum non conveniens grounds, “because we previously indicated that the proper method of review in this type of case is a petition for a writ of mandamus, we will exercise our original jurisdiction and consider this petition”). Second, our decision to...