Judge: Salvatore Sirna, Case: 24PSCV03347, Date: 2025-06-16 Tentative Ruling
The Court may change tentative rulings at any time. Therefore, counsel are advised to check this website periodically to determine whether any changes or updates have been made to the tentative ruling. Counsel may submit on a tentative ruling by calling the clerk in Department G at (909) 802-1104 prior to 8:30 a.m. the morning of the hearing.
Case Number: 24PSCV03347 Hearing Date: June 16, 2025 Dept: G
Defendant’s Motion to Compel Arbitration
Respondent: Plaintiffs Eduardo Saldana AKA Eduardo Saldana Navarro and Patricia Najarro AKA Patricia Guadalupe Najarro
TENTATIVE RULING
Defendant’s Motion to Compel Arbitration is GRANTED, and proceedings are STAYED pending the outcome of arbitration.
BACKGROUND
This is a Song-Beverly action. On April 4, 2023, Plaintiffs Eduardo Saldana AKA Eduardo Saldana Navarro and Patircia Najarro AKA Patricia Guadalupe Najarro (Plaintiffs) leased a 2023 Toyota Tacoma (Subject Vehicle) for a total price of $22,837.05. Plaintiffs allege that they entered into a warranty contract with Defendant Toyota Motor Sales U.S.A. Inc. (Defendant) for the Subject Vehicle. Plaintiffs allege that defects and nonconformities to the warranty manifested themselves within the applicable warranty period, and that Defendant was unable to conform the Subject Vehicle to the warranty after a reasonable number of repair attempts.
On October 7, 2024, Plaintiffs filed their Complaint against Defendant and Does 1-10, alleging the following causes of action: (1) Violation of Song-Beverly Act - Breach of Express Warranty, and (2) Violation of Song-Beverly Act - Breach of Implied Warranty.
On May 20, 2025, Defendant filed the present Motion to Compel Arbitration. Plaintiffs filed an Opposition on June 3, 2025. Defendant filed a Reply on June 9, 2025.
A hearing on the present motion is set for June 16, 2025.
REQUEST FOR JUDICIAL NOTICE
Defendant requests that the Court take judicial notice of Plaintiffs’ Complaint filed on October 7, 2024. The Court GRANTS Defendant’s request for judicial notice, as the Court may take judicial notice of court records. (Evid. Code, § 452(d).) However, the Court will not take judicial notice of the truth of assertions within. (See Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375.)
EVIDENTIARY OBJECTIONS
Plaintiffs submit one evidentiary objection to the Declaration of Ali Ameripour (Ameripour). Specifically, Plaintiffs object to paragraph 4 of Ameripour’s declaration, as well as the “Exhibit 2” that it references. The paragraph that Plaintiffs object to states, “Attached hereto as Exhibit ‘2’ is a true and correct copy of Plaintiffs’ Motor Vehicle Lease Agreement for the lease of the subject vehicle.”
The court agrees that Ameripour’s declaration provides no facts to support a finding that Exhibit 2 is a “true and correct copy” of the Lease. Additionally, Ameripour fails to state any facts as to how Defendant obtained Exhibit 2.
Without this foundation, the court SUSTAINS Plaintiffs’ objection. As such, the court will not consider paragraph 4 or Exhibit 2 of Ameripour’s declaration.
ANALYSIS
Defendant argues Plaintiffs’ Complaint is subject to a valid and binding arbitration agreement. For the following reasons, the court agrees.
Legal Standard
“A written agreement to submit to arbitration an existing controversy or a controversy thereafter arising is valid, enforceable and irrevocable, save upon such grounds as exist for the revocation of any contract.” (Code Civ. Proc., § 1281.)¿ The court must grant a petition to compel arbitration unless it finds no written agreement to arbitrate exists, the right to compel arbitration has been waived, grounds exist for revocation of the agreement, or litigation is pending that may render the arbitration unnecessary or create conflicting rulings on common issues.¿ (Code Civ. Proc., § 1281.2.)
“[T]he moving party bears the burden of producing ‘prima facie evidence of a written agreement to arbitrate the controversy.’” (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 165.) To establish prima facie evidence of an arbitration agreement, the party moving for arbitration need only provide a copy of the arbitration provision that purports to be signed by the parties or set forth the agreement’s terms in the motion. (Ibid.) If the moving party meets its initial prima facie burden, then the opposing party “bears the burden of producing evidence to challenge the authenticity of the agreement” and can do so with statements under oath. (Ibid.) If the opposing party meets their burden, the moving party must then establish a valid arbitration agreement with admissible evidence by preponderance of the evidence. (Ibid.)
Once the court finds an arbitration agreement exists, the opposing party bears the burden of establishing a defense to enforcement by preponderance of the evidence. (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413.) In interpreting an arbitration agreement, courts apply the same principles used to interpret contractual provisions with the fundamental goal of giving effect to the parties’ mutual intentions and applying contractual language if clear and explicit. (Valencia v. Smyth (2010) 185 Cal.App.4th 153, 177.) Because public policy strongly favors arbitration, “any doubts regarding the arbitrability of a dispute are resolved in favor of arbitration.” (Coast Plaza Doctors Hosp. v. Blue Cross of California (2000) 83 Cal.App.4th 677, 686.)
Existence of an Arbitration Agreement
Defendant argues that Plaintiffs’ action is subject to a binding arbitration provision contained in the terms of the Lease Agreement for the Subject Vehicle (Lease). (Motion to Compel Arbitration (Motion), 3:2-6.)
To support the existence of the arbitration provision, Defendant sets forth the relevant terms of the arbitration clause. (Motion, 3:28 - 4:1-12) By doing so, the court finds Defendant met its initial burden of producing prima facie evidence of a written agreement to arbitrate. (See Gamboa, supra, 72 Cal.App.5th at p. 165.) Accordingly, the burden shifts to Plaintiffs to produce evidence challenging the arbitration agreement’s authenticity.
In opposition, Plaintiffs do not dispute the authenticity of the arbitration provision. In fact, Plaintiffs restate it in their papers. (Opposition, 3:24-28 - 4:1-2.)
Accordingly, the court finds an arbitration agreement exists.
Defenses Against Enforcement
Defendant is not a “Covered Party” Under the Arbitration Provision
Plaintiffs argue that Defendant is not a covered party under the arbitration provision because Defendant is not included in the list of entities that are entitled to compel arbitration. (Opposition, 4:3-10.)
The arbitration provision states that “covered parties” include: “Toyota Lease Trust, Toyota Motor Credit Corporation, Lexus Financial Services, Toyota Motor Insurance Services, Inc., and/or any of our or its affiliates and/or any of our or their employees, officers, successors, assigns or against any third party providing any product or service in connection with this Lease.” (Motion, 3:28 - 4:1-12; Opposition, 3:24-28 - 4:1-2.)
Defendant argues that it is an affiliate of Toyota Lease Trust and the other named entities, and therefore, is a covered party under the arbitration provision. (Motion, 5:2-8.)
In opposition, Plaintiffs argue that Defendant does not establish that it is an affiliate. (Opposition, 4:16-18.) Plaintiffs argue that neither the Lease containing the arbitration provision nor the moving papers define “affiliate.” (Opposition, 4:18-19.) Plaintiffs reference California Corporations Code section 2680.4 and Iqbal v. Ziadeh (2017) 10 Cal.App.5th 1 which define “affiliate” as follows: “The word ‘affiliate’ means any person that directly, or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with the person to which such ‘affiliate’ is related.” (Corp. Code § 2680.4.) The relevant portion of Iqbal looked to multiple dictionaries and recognized that “Black’s Law Dictionary defines an ‘affiliate’ outside of the securities context as ‘[a] corporation that is related to another corporation by shareholdings or other means of control; a subsidiary, parent, or sibling corporation.’” (Iqbal, 10 Cal.App.5th at pp. 10-11.)
Defendant states throughout its Motion that it is an affiliate of the named entities but does not provide any facts or evidence upon which the court may rely in determining Defendant’s status as an “affiliate.” While a connection or affiliation could be inferred because Defendant shares the “Toyota” name, the court recognizes it cannot rely on that inference alone to determine Defendant’s status as an affiliate. Further, Defendant’s pleadings lack any explanation or proof that Defendant is under common control or has any relation to the entities listed in the arbitration provision.
Accordingly, the court finds that Defendant is not an “affiliate” under the arbitration provision.
The arbitration provision states that covered parties include, “...any third party providing any product or service in connection with this Lease.” (Motion, 3:28 - 4:1-12; Opposition, 3:24-28 - 4:1-2.)
Defendant argues that it is a third party beneficiary because it falls within the class of persons or entities for whom the arbitration provision was intended. (Motion, 5:26-28.) Defendant also argues that the arbitration provision expressly allows Defendant to compel arbitration because Defendant is a third party who provided a product in connection with the lease. (Reply, 2:21-23.)
In opposition, Plaintiffs argue Defendant failed to produce any evidence that it is a third party that provided a product or service in connection with the Lease. (Opposition, 6:8-10.) Plaintiffs also argue that “Defendant has nothing to do with the financing component of a vehicle purchase” (Opposition, 4:7) and that “[t]he fact that Defendant manufactured the Subject Vehicle does not have anything to do with the Lease Agreement” (Opposition, 6:12-13).
The court disagrees with Plaintiffs’ arguments since the Subject Vehicle is the main subject of the Lease. Thus, there is no doubt that Defendant – the manufacturer of the Subject Vehicle – provided a product in connection with the Lease. Additionally, the fact that Defendant was not involved in the financing component is irrelevant since the plain language of the arbitration provision indicates that any third party providing a product in connection with the Lease is a covered party.
Therefore, the court finds that Defendant is a covered party under the arbitration provision because Defendant is a “third party providing [a] product or service” in connection with the Lease.
Accordingly, Plaintiffs’ defenses against enforcement of the arbitration provision fail.
Therefore, Plaintiffs’ Complaint is subject to the arbitration provision in the Lease.
Equitable Estoppel
A plaintiff may be equitably estopped from repudiating the arbitration clause contained in a contract where she or he relies on contract terms in a claim against a non-signatory defendant, and when the causes of action against the non-signatory are “intimately founded in and intertwined with the underlying contract obligations” that are subject to the arbitration clause. (Boucher v. Alliance Title Co, Inc. (2005) 127 Cal.App.4th 262, 271); Goldman v. KPMG, LLP (2009) 173 Cal.App.4th 209, 217-218.)
Defendant argues that it may compel arbitration under the doctrine of equitable estoppel. (Motion, 6:18-19.) Specifically, Defendant argues that Plaintiffs rely on the Lease in asserting its claims against Defendant, “as there would be no claims under Song-Beverly but for the existence of the sale transaction which was created by and through the Lease.” (Motion, 7:4-9.) Defendant also argues that Plaintiffs’ Song-Beverly claims are inseparable from the Lease because they “flow” from the relationship created by the Lease. (Motion, 7:25-28.)
Plaintiffs argue that Defendant’s argument fails because it is contrary to the weight of controlling authority. (Opposition, 7:7-8.) The court agrees. “Equitable estoppel does not apply ‘merely because the lawsuit was predicated on the bare fact that a vehicle purchase occurred.’” (Davis v. Nissan North America, Inc. (2024) 100 Cal.App.5th 825, 843, citing Murphy v. DirectTV, Inc. (2013) 724 F.3d 1218, 1230 (9th Cir.).) For equitable estoppel to apply, “[P]laintiff’s allegations must rely on or depend on ‘the terms of the written agreement’ [Citation omitted], not simply on the fact that an agreement exists.” (Goldman v. KPMG, LLP (2009) 173 Cal.App.4th 209, 231.)
Here, Plaintiffs’ Song-Beverly claims do not rely on the terms of the Lease. Defendant’s argument that Plaintiffs would have no Song-Beverly claims but for the existence of the Lease is exactly what the Goldman court said does not invoke the doctrine of equitable estoppel.
Accordingly, Defendant’s argument that it may compel arbitration under the doctrine of equitable estoppel fails.
CONCLUSION
Based on the foregoing, Defendant’s Motion to Compel Arbitration is GRANTED. The action is STAYED pending completion of arbitration.¿