In Goodridge v. KDF Automotive Group, Inc., 2016 WL 142216, at *9-10 (Cal.App. 4 Dist., 2016) (unpublished), the Court of Appeal addressed Plaintiff’s continued post-Sanchez fight against arbitration, finding that the standard form RISC was not unconscionable. The Court of Appeal also found that that the Defendant’s litigation conduct did not waive the right to assert it.
We conclude Goodridge has not carried his burden on appeal to show the evidence is insufficient to support the trial court’s finding that KDF did not waive its right to enforce the Contract’s arbitration provision. The trial court, in effect, found KDF’s initial failure to assert its right to enforce the arbitration provision was excused by the subsequent change in the law of arbitration that occurred on the issuance of the United States Supreme Court opinion in AT & T. . . .We conclude there is substantial evidence to support the trial court’s finding that KDF did not unduly delay in asserting, or otherwise waive, its right to enforce the arbitration provision. . . The court could reasonably find KDF’s failure to immediately assert its right to enforce the arbitration provision after Goodridge filed the instant action was justified by Discover Bank ‘s rejection of class action waivers in arbitration provisions, which was, at the time, the precedent that courts followed. . . .First, although KDF filed an answer to his complaint, Goodridge does not cite any case or other authority showing the filing of an answer by a defendant necessarily waives, or is inconsistent with enforcement of, a right to arbitrate a dispute. Furthermore, although KDF’s failure to plead the arbitration agreement as an affirmative defense in its answer presumably is an act inconsistent with a later assertion of a right to arbitrate (Guess?, Inc. v. Superior Court (2000) 79 Cal.App.4th 553, 557–558), the trial court properly considered other factors, particularly AT & T ‘s change in the law regarding the validity of arbitration provisions containing class action waivers, in determining whether KDF waived that right as a matter of law. Second, although KDF responded to multiple sets of Goodridge’s discovery requests without requesting or mentioning the Contract’s arbitration provision, those discovery actions did not necessarily constitute substantial invocation of the litigation machinery and those actions were not shown to be unavailable in arbitration. Third, although KDF did not file its motion to compel arbitration until about six months after the complaint was filed, much of that delay (i.e., almost five months), as KDF argued below, was caused by its adherence to then-applicable law (i.e., Discover Bank ) that generally precluded the enforcement of arbitration provisions with class action waivers. . . Finally, and most importantly, Goodridge did not show he was prejudiced by KDF’s delay and purported inconsistent actions. Prejudice sufficient to find a waiver of an arbitration agreement 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.”
In dicta, the Court of Appeal rejected the Plaintiff’s Broughton/Cruz argument.
Goodridge summarily argues that because the relief requested (e.g., injunctive relief) for certain causes of action alleged in his complaint cannot be the subject of arbitration, those causes of action must be severed from the other causes of action that are subject to arbitration under the Contract’s arbitration provision. However, because he has not presented any substantive legal analysis persuading us those causes of action are not arbitrable, we need not, and do not, address that argument. In any event, the cases he summarily cites in support of his argument (i.e., Cruz v. PacifiCare Health Systems, Inc. (2003) 30 Cal.4th 303 and Broughton v. Cigna Healthplans (1999) 21 Cal.4th 1066) have been, in effect, overruled by AT & T and therefore do not require severance of any of his causes of action from arbitration. (See, e.g., Nelsen v. Legacy Partners Residential, Inc. (2012) 207 Cal.App.4th 1115, 1136; Ferguson v. Corinthian Colleges, Inc. (9th Cir.2013) 733 F.3d 928, 934–937; Kilgore v. Keybank, Nat. Assn., supra, 673 F.3d at p. 963.)