Verdugo v. Alliantgroup, L.P., 237 Cal. App. 4th 141 (2015)

Rachel Verdugo, an associate director in the Irvine office of Alliantgroup, filed this putative class action against her employer for various violations of the California Labor Code governing overtime compensation, meal and rest breaks, vacation pay, the Private Attorneys General Act and accurate wage statements. When she was hired, Verdugo had signed an “Employment Agreement” that included a combined choice-of-law provision (invoking Texas law) and forum selection clause, requiring the sole venue for disputes to be in Harris County, Texas – the location of Alliantgroup’s corporate headquarters where Verdugo had had “only minimal contact.” The trial court granted the employer’s motion to stay the action based on the forum selection clause. The Court of Appeal reversed, holding that Alliantgroup had failed to meet its burden to show that enforcing the forum selection clause would not significantly diminish Verdugo’s unwaivable statutory rights under California law. The Court was not persuaded by Alliantgroup’s argument that a Texas court “would most likely” reject the parties’ choice-of-law clause and apply California law. The Court further concluded that “Alliantgroup fails to show the remedies Texas law provides are ‘adequate,’ let alone that enforcing the forum selection clause would not diminish Verdugo’s rights.”