Unreported / Non-Citable
Background
Employees Dora Patricia Amaya and Anibal Silva brought a putative class action against Menzies Aviation USA in the Central District of California. Menzies knew early that at least one plaintiff had signed an arbitration agreement and repeatedly said it reserved the right to arbitrate. Even so, the company litigated in federal court for 28 months before moving to compel arbitration.
During that period Menzies participated in case-management proceedings, served and answered discovery, handled a discovery motion, entered a protective order, took and defended depositions, and moved for partial summary judgment on claims for reimbursement of employee expenses. The district court compelled arbitration in part and denied the motion in part. Menzies appealed, while the employees cross-appealed on waiver.
The Court’s Holding
The Ninth Circuit held that Menzies waived its arbitration right and reversed the order to the extent it held otherwise. Waiver requires knowledge of the right and intentional acts inconsistent with that right. Menzies did not dispute knowledge, so the totality of its litigation conduct controlled the result.
The company’s 28-month course of active merits litigation was inconsistent with promptly choosing arbitration. Its summary-judgment motion was particularly important because it sought a court ruling capable of eliminating claims for the whole proposed class. Participating deeply in discovery and shaping the federal action also showed an effort to take advantage of the judicial forum before invoking the contractual alternative.
Repeated reservations of the arbitration right did not override what the company actually did. Nor did waiting for a potentially relevant Ninth Circuit decision excuse the delay, because that decision concerned only one of many worker groups covered by the eventual motion. The panel remanded for district-court proceedings and did not review class certification, over which it lacked interlocutory jurisdiction. The memorandum is unpublished and generally nonprecedential.
Key Takeaways
- A written reservation of arbitration rights is not a safe harbor when a party’s conduct shows a prolonged choice to litigate.
- Courts assess the totality of intentional acts, including delay, discovery, case management, depositions, and merits motions.
- Seeking summary judgment can be powerful evidence of waiver because it asks the court for a merits advantage before arbitration is invoked.
- Waiting for legal developments may not justify delay when the anticipated ruling addresses only a fraction of the claims or workers in the case.
- Parties seeking arbitration should identify the agreement and move promptly, while coordinating any necessary threshold discovery with an express and consistent arbitration strategy.
Why It Matters
California employers frequently use arbitration agreements in wage-and-hour and expense-reimbursement disputes, but the contract alone does not preserve the forum indefinitely. Once a defendant spends years litigating and seeks substantive judicial relief, a later motion to compel may look like forum switching after testing the litigation landscape. The resulting waiver can expose the entire dispute to continued court proceedings even if the agreement itself would otherwise be enforceable.
Defense counsel should evaluate arbitration at the outset, document any genuinely necessary preliminary investigation, and avoid merits activity inconsistent with the intended motion. If limited discovery is needed to identify agreements or covered workers, counsel should narrowly define it and move as soon as the necessary facts are available. Plaintiff-side counsel should build a chronology of the opponent’s knowledge and litigation choices when asserting waiver. Although nonprecedential, the decision applies the Ninth Circuit’s established post-Morgan waiver framework to a practical employment-class-action record.