TENTATIVE RULING

Calendar: 1

Date: 2/24/2023

Case No.: 22 GDCV00446 Trial Date:  None Set

Case Name: Navarro v. Tesla, Inc.

MOTION TO COMPEL ARBITRATION

Moving Party: Defendant Tesla, Inc.     

Responding Party: Plaintiff Joel Navarro (No Opposition)  

FACTUAL BACKGROUND: 

Plaintiff Joel Navarro alleges that in December of 2021, plaintiff leased a 2022 Tesla Model S vehicle, and that express warranties accompanied the lease of the vehicle to plaintiff by which defendant Tesla, Inc. dba Tesla Motors, Inc. undertook to preserve or maintain the utility or performance of plaintiff’s vehicle or to provide compensation if there was a failure in such utility or performance.  

Plaintiff alleges that the vehicle was delivered to plaintiff with serious defects and nonconformities to warranty and developed other serious defects and nonconformities to warranty, including structural and electrical system defects.  Plaintiff alleges that plaintiff hereby revokes acceptance of the sales contract, and also alleges that the nonconformities substantially impair the use, value, or safety of the vehicle, that defendant was unable to conform the vehicle to the applicable express warranty after a reasonable number of repair attempts, and that defendant has failed to either promptly replace the vehicle or make restitution in accordance with the Song-Beverly Act.  

The complaint alleges causes of action for violation of Song-Beverly Act—breach of express warranty, violation of Song-Beverly Act—breach of implied warranty, and violation of Song-Beverly Act—section 1793.

OPPOSITION:

(Served and filed within 10 days after service of petition, or within 30 days if service outside the state, after petition is served (§1290.6)  [unless extension granted by stipulation or court order determining good cause])

No opposition. 

ANALYSIS:

Procedural

No Opposition 

There is no timely opposition to this motion.  Under CCP § 1290.6, a response to a petition to compel arbitration “shall be served and filed within 10 days of the service of the petition.”  Here, the motion was served on December 13, 2022, by electronic transmission.   Allowing two days for service by email, opposition was due on or before January 4, 2023, over six weeks ago.  Opposition has also not been filed within nine court days of the date set for hearing, as required for standard motions under CCP §1005(b), which would have been on February 9, 2023.  The motion may be granted on the ground no timely opposition has been served or filed. 

Substantive  

Defendant Tesla, Inc. (Tesla) seeks an order compelling plaintiff to arbitrate his claims in accordance with an arbitration agreement with Tesla and to stay this action pending the outcome of the arbitration. 

CCP § 1281.2, governing orders to arbitrate controversies, provides, in pertinent part:

“On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy and that a party to the agreement refuses to arbitrate that controversy, the court shall order the petitioner and the respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists, unless it determines that:

(a) The right to compel arbitration has been waived by the petitioner; or

(b) Grounds exist for rescission of the agreement.” 

Under the Federal Arbitration Act, arbitration agreements “shall be valid, irrevocable and enforceable, save upon such grounds that exist at law or in equity for the revocation of a contract.”   9 U.S.C. section 2. 

There is a strong public policy in favor of arbitration of disputes and any doubts concerning the scope of arbitrable disputes should be resolved in favor of arbitration.  Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 9 (“courts will ‘indulge every intendment to give effect to such proceedings.’”) (quotation omitted).  “[A]rbitration agreements should be liberally interpreted, and arbitration should be ordered unless the agreement clearly does not apply to the dispute in question.”  Vianna v. Doctors’ Management Co. (1994) 27 Cal.App.4th 1186, 1189, quoting Weeks v. Crow (1980) 113 Cal.App.3d 350, 353.  See also AT&T Mobility, LLC v. Concepcion (2011) 563 U.S. 333, 339.  

In this case, defendant has submitted a copy of a Motor Vehicle Order Agreement affiliated with plaintiff’s file, as well as a Lease Agreement between plaintiff and Tesla Motors, Inc., which are authenticated by a Staff Business Resolution Partner at Tesla, Raymond Kim, and company records.  [Kim Decl., paras. 2-13, Exs. 1, 2].   

Both documents include arbitration provisions.  The Lease Agreement, which was executed by both plaintiff and defendant, includes an arbitration agreement which is set off in a box and provides:

“Agreement to Arbitrate. Please carefully read this provision, which applies to any dispute between you and Tesla, Inc. and its affiliates, (together “Tesla”). 

If you have a concern or dispute, please send a written notice describing it and your desired resolution to resolutions@tesla.com. 

If not resolved within 60 days, you agree that any dispute arising out of or relating to any aspect of the relationship between you and Tesla will not be decided by a judge or jury but instead by a single arbitrator in an arbitration administered by the American Arbitration Association (AAA) under its Consumer Arbitration Rules. This includes claims arising before this Agreement, such as claims related to statements about our products. 

We will pay all AAA fees for any arbitration, which will be held in the city or county of your residence. To learn more about the Rules and how to begin an arbitration, you may call any AAA office or go to www.adr.org. 

The arbitrator may only resolve disputes between you and Tesla and may not consolidate claims without the consent of all parties. The arbitrator cannot hear class or representative claims or requests for relief on behalf of others purchasing or leasing Tesla vehicles. In other words, you and Tesla may bring claims against the other only in your or its individual capacity and not as a plaintiffs or class member in any class or representative action. If a court or arbitrator decides that any part of this agreement to arbitrate cannot be enforced as to a particular claim for relief or remedy, then that claim or remedy (and only that claim or remedy) must be brought in court and any other claims must be arbitrated. 

If you prefer, you may instead take an individual dispute to small claims court. 

You may opt out of arbitration within 30 days after signing this Agreement by sending a letter to: Tesla, Inc.; P.O. Box 15430; Fremont, CA 94539-7970, stating your name, Vehicle Identification Number, and intent to opt out of the arbitration provision. If you do not opt out, this agreement to arbitrate overrides any different arbitration agreement between us, including any arbitration agreement in a lease or finance contract.”

[Kim Decl., paras. 8-13, Ex. 2, para. 33, bold in original].  

Tesla’s representative also indicates that plaintiff’s file includes no opt outs.  [Kim Decl., para. 7]. 

This showing appears sufficient to establish the existence of an agreement to arbitrate between the parties.  The declaration of counsel for defendant also indicates, “On December 13, 2022, my office asked that Plaintiff stipulate to arbitration.  Plaintiff did not agree to stipulate to arbitration.” [Ameripour Decl., para. 3].   

There is no opposition to the motion to dispute this evidence, and, in fact, under CCP § 1290, “The allegations of a petition are deemed to be admitted by a respondent duly served therewith unless a response is duly served and filed.”

The complaint here clearly arises from “any dispute arising out of or relating to any aspect of the relationship between” plaintiff and Tesla, as set forth in the agreement.  This situation is not a case where a non-signatory is attempting to enforce the agreement.  

Absent opposition showing a waiver or rescission of this agreement, the court must order the parties to arbitrate.   

Under CCP § 1281.4, where the court has ordered arbitration of a controversy, the court

 "shall, upon motion of a party to such action or proceeding,  stay the action or proceeding until an arbitration is had in accordance with the order to arbitrate or until such earlier time as the court specifies."

Defendant has requested in the motion that the action be stayed.  The matter is currently pending only between plaintiff and defendant as a named defendant, and the entire action is stayed pending arbitration. 

RULING:

[No Opposition]

Defendant Tesla, Inc.’s UNOPPOSED Motion to Compel Binding Arbitration is GRANTED. 

The Court notes that it received no timely opposition to the motion to compel, as required by CCP § 1290.6.  Accordingly, pursuant to CCP §1290, the allegations of the motion are deemed to be admitted by plaintiff.    

The Court finds that an agreement to arbitrate the controversy exists, that there is no showing that there has been any waiver of the right to compel arbitration, and no showing that the agreement has been rescinded or that grounds exist for rescission of the agreement.  

The Court orders Joel Navarro and defendant Tesla, Inc. to arbitrate this matter according to the Agreement to Arbitrate included in the Lease Agreement between the parties, dated 12/10/2021.  

The Court further orders pursuant to CCP § 1281.4 that this action shall be stayed until an arbitration has been had according to this order.

UNOPPOSED Request for Judicial Notice in Support of Defendant Tesla, Inc.’s Motion to Compel Binding Arbitration is GRANTED. 

GIVEN THE CORONAVIRUS CRISIS, AND TO ADHERE TO HEALTH GUIDANCE THAT DICTATES SAFETY MEASURES, DEPARTMENT D IS ENCOURAGING AUDIO OR VIDEO APPEARANCES

Please make arrangement in advance if you wish to appear via LACourtConnect/Microsoft Teams by visiting www.lacourt.org to schedule a remote appearance.  Please note that LACourtConnect/Microsoft Teams offers free audio and video appearance. Counsel and parties (including self-represented litigants) are encouraged not to personally appear.  With respect to the wearing of face masks, Department D recognizes that currently, the Los Angeles Department of Public Health strongly recommends masks indoors, especially when interacting with individuals whose vaccination status is unknown; for individuals who have a health condition that puts them at higher risk for severe illness; individuals who live with someone who is at higher risk; and for individuals who are around children who are not yet eligible for vaccines.  In accordance with this guidance, it is strongly recommended that anyone personally appearing in Department D wear a face mask.  The Department D Judge and court staff will continue to wear face masks.  If no appearance is set up through LACourtConnect/Microsoft Teams, or otherwise, then the Court will assume the parties are submitting on the tentative.