In Ionescu v. Extra Space Storage, No. 19-cv-02226-YGR, 2019 U.S. Dist. LEXIS 143992, at *1-2 (N.D. Cal. Aug. 23, 2019), Judge Gonzalez-Rogers ordered a claim to arbitration. The facts were as follows:
Plaintiffs Alexandru Ionescu, Lenay Johnson, and Lamar Mosley bring this putative class-action law suit against defendant Extra Space Storage Inc. (“Extra Space”) for false advertising in violation of California Business and Professions Code Section 17500 (Count I), unfair competition in violation of Section 17200 (Count II), and violations of the California Consumers Legal Remedies Act (“CLRA“) (Count III). (Dkt. No. 1-1 at ECF 50-63 (“ACAC.”) ¶¶ 64-78.) Specifically, plaintiffs allege that Extra Space “engage[d] in a deceptive bait-and-switch scheme” in which “[i]t lures consumers into leasing Extra Space’s storage units by advertising competitive rental rates, while hiding the fact that it will hike up those rental rates shortly after consumers have signed leases.”
Judge Gonzalez-Rogers ordered the individual claim to arbitration.
Specifically, plaintiffs contend that the prohibition of plaintiffs proceeding in arbitration on any sort of “representative” basis that “does not contain a carveout for actions seeking injunctive relief on behalf of the general public as contemplated by the UCL, CLRA, and FAL” violates the McGill Rule. (Opp. at 5-6.) Defendant replies that this agreement does not fall within the McGill Rule because unlike the arbitration provision at issue in McGill, the Provision here does not “preclude the arbitrator from issuing any relief beyond the individual claimant at issue in the case.” (Dkt. No. 19 (“Reply”) at 7 (emphasis in original).) The Court agrees. The arbitration agreement at issue in McGill reads as follows: “Claims must be brought in the name of an individual person or entity and must proceed on [*11] an individual (non-class, non-representative) basis. The arbitrator will not award relief for or against anyone who is not a party. If you or we require arbitration of a Claim, neither you, we, nor any other person may pursue the Claim in arbitration as a class action, private attorney general action or other representative action, nor may such Claim be pursued on your or our behalf in any litigation in any court.” McGill, 2 Cal.5th at 952 (emphasis supplied). The California Supreme Court in McGill did “not independently analyze the arbitration provision” and instead “proceed[ed] based on the parties’ shared view that [the arbitration provision] purports to preclude McGill from seeking public injunctive relief in arbitration, in court, or in any forum[.]” Id. at 956 (emphasis in original). Nonetheless, the language indicating that “[t]he arbitrator will not award relief for or against anyone who is not a party” has been found to violate the McGill rule. See Adkins v. Comcast Corporation, No. 16-cv-05969-VC, 2018 WL 4846548, at *1 (N.D. Cal. Feb. 15, 2018) (“The arbitrator may award relief only in favor of the individual party seeking relief . . . . The arbitrator may not award relief for or against anyone who is not a party.”); Blair v. Rent-A-Center, Inc., No. C 17-02335 WHA, 2017 WL 4805577 , at * (N.D. Cal. Oct. 25, 2017) (“In the event that a party elects to arbitrate . . . the agreement . . . provided . . . that the arbitrator was prohibited from ‘award[ing] relief that would affect RAC account holders other than [the customer.]'”). Plaintiffs argue that the provision here violates McGill because it states that signatories to the agreement “will only pursue arbitration on an individual basis and will not pursue arbitration or any other claim on a class-wide, representative, or consolidated basis[.]” (See Opp. at 5-6 (emphasis supplied).) The focus on the word “pursue” to demonstrate a violation of the McGill rule does not persuade. That the Arbitration Provision prohibits plaintiffs from proceeding “on a representative basis, surely an arbitrator cannot award representative relief[,]” does not mean that an arbitrator cannot award injunctive relief benefiting the public at large. As McGill itself makes clear, an action seeking public injunctive relief is not a “representative action.” McGill, 2 Cal.5th at 959-61; see also Magana v. DoorDash, Inc., 343 F.Supp.3d 891, 901 (N.D. Cal. 2018). Therefore, the presence of a class action waiver, like the one present here, does not, without more, violate the McGill Rule. See Magana, 343 F.Supp.3d at 901; Lee v. Postmates Inc., No. 18-cv-03421-JCS, 2018 WL 4961802, at *9 (N.D. Cal. Oct. 15, 2018); Trout v. Comcast Cable Communications, LLC, No. 17-cv-01912-RS, 2018 WL 4638705, at *4 (N.D. Cal. Mar. 15, 2018). Moreover, the Arbitration Provision specifically contemplates claims for violation of California Business and Professions Code Section 17200, the same claim that plaintiffs assert forms the basis for their claim for public injunctive relief. (See Ionescu Agreement at ECF 14 (noting that Section 17200 claims “shall be subject to arbitration under the terms of this Arbitration Provision”); Opp. at 4.)