Shirak Harootoonian v. Mercedes-Benz USA, LLC, et al.

fiduciary obligations.) (ABBA Rubber Co. v. Seaquist (1991) 235 Cal.App.3d 1, 14.) To this point, the Court finds $25,000.00 adequate. However, the Court also notes that Plaintiff fails to post an undertaking with its application as required by Code of Civil Procedure Section 529. On this basis alone, the Court grants the instant motion contingent on posting an undertaking in the amount of $25,000.00.

IV.

Conclusion

Based on the foregoing, Plaintiff's motion for appointment of receiver and preliminary injunction in aid of receiver is GRANTED, effective once Plaintiff posts an undertaking in the amount of $25,000.00 pursuant to Code of Civil Procedure Section 529. Plaintiff to give notice.

SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANGELES SHIRAK HAROOTOONIAN, an individual, Plaintiff, vs. MERCEDES-BENZ USA, LLC, et al. Defendants. |))))))))))))))) | CASE NO: 26VECV03723

[TENTATIVE] ORDER RE: MOTION TO COMPEL ARBITRATION Dept. I HEARING DATE: August 31, 2026 TIME: 8:30 A.M. COMPLAINT FILED: June 25, 2026 TRIAL DATE: None set. |

I. BACKGROUND

This is a lemon law action arising out of Plaintiff Shirak Harootoonian's ("Plaintiff") purchase of a 2026 Mercedes-Benz GLE53C4, VIN: 4JGFD6BB3TB607062 (the "Subject Vehicle"), which was not in a merchantable condition. On June 25, 2026, Plaintiff filed the operative Complaint against Defendants Mercedes-Benz USA, LLC ("MBUSA") and DOES 1 through 100 (collectively, "Defendants"), alleging causes of action for: (1) Breach of Implied Warranty; (2) Breach of Express Warranty; and (3) Violation of the Song-Beverly Consumer Warranty Act. On July 30, 2026, MBUSA filed the instant Motion to Compel Arbitration. Any opposition would have been due on August 18, 2026. To date, no opposition has been filed.

II. LEGAL STANDARD

In deciding a motion to compel arbitration, trial courts must first decide whether an enforceable arbitration agreement exists between the parties and then determine the second gateway issue of whether the claims are covered within the scope of the agreement. (See Omar v. Ralphs Grocery Co. (2004) 118 Cal.App.4th 955, 961.)(See also Chiron Corp. v. Ortho Diagnostic Systems, Inc. (9th Cir. 2000) 207 F. 3d 1126, 1130 ["The court's role under the [Federal Arbitration Act ("FAA")] is therefore limited to determining (1) whether a valid agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue."].

"The petitioner bears the burden of proving the existence of a valid arbitration agreement by the preponderance of the evidence, and a party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense." (Engalla v. Permanente Medical Group, Inc. (1997) 64 Cal.Rptr.2d 903, 915-16.) "In these summary proceedings, the trial court sits as a trier of fact, weighing all the affidavits, declarations, and other documentary evidence, as well as oral testimony received at the court's discretion, to reach a final determination." (Id. at 916.) No jury trial is available for a petition to compel arbitration. (Ibid.)

Accordingly, under both the FAA and California Law, arbitration agreements are valid, irrevocable, and enforceable, except on such grounds that exist at law or equity for voiding a contract. (Winter v. Window Fashions Professions, Inc. (2008) 166 Cal.App.4th 943, 947.)

III. DISCUSSION

Prior Demand for Arbitration

A party seeking to compel arbitration under Code of Civil Procedure Section 1281.2 must "plead and prove a prior demand for arbitration under the parties' arbitration agreement and a refusal to arbitrate under the agreement." (Mansouri v. Super. Ct. (2010) 181 Cal.App.4th 633, 640; Civ. Proc. Code, Sec. 1281.2.) Here, MBUSA fails to plead and prove that a prior demand to arbitrate was made to Plaintiff, and subsequently refused. Nevertheless, Plaintiff does not oppose the present motion on any grounds including procedurally error. Thus, the Court will exercises its discretion and rule on the merits below.

Existence of a Valid Arbitration Agreement

For the reasons set forth below, the Court finds that MBUSA has established that a valid agreement to arbitrate Plaintiff's claims exist. Here, Plaintiff's claims arise out of his purchase of the Subject Vehicle from Mercedes-Benz of Calabasas and alleged defective condition of the Subject Vehicle, which manifested during the applicable warranty period. (Compl., P.P.6-12.)

On March 3, 2026, Plaintiff was presented with the California Motor Vehicle Lease Agreement (the "Lease"), which included an arbitration provision explicitly stating: "Any claim or dispute, whether in contract, tort, or otherwise (including any dispute over the interpretation, scope, or validity of this lease, arbitration section or the arbitrability of any issue), between you and us or any of our employees, agents, successors, assigns, or the vehicle distributor, including Mercedes-Benz USA, LLC (each a "Third Party Beneficiary"), which arises out of or relates to a credit application, this lease, or any resulting transaction or relationship arising out of this lease (including any such relationship with third parties who do not sign this contract) shall, at the election of either you, us, or a Third Party Beneficiary, be resolved by a neutral binding arbitration and not by a court action.

Any claim or dispute is to be arbitrated on an individual basis and not as a class action. The arbitration shall be administered by the American Arbitration Association, or by any other organization that you may choose, subject to our or a Third Party Beneficiary's approval. You may get a copy of the rules of the American Arbitration Association by visiting its website at www.adr.org." (Allison Decl., P.2, Ex. A - Lease: "Important Arbitration Disclosures" at p. 4 [emphasis added].)

Plaintiff signed and initialed the Lease, which contained the following statement in bold text and above the signature line: " By signing below, you acknowledge that: This lease is completely filled out; You have received and read all 10 pages of this lease carefully and agree to all of its terms, INCLUDING THE IMPORTANT ARBITRATION DISCLOSURES ON PAGES 4 AND 5; ...." (Allison Decl., P.2, Ex. A at p. 6.) There is no opposition filed, thus Plaintiff does not dispute he signed and initialed the Lease containing the arbitration provision at issue.

The Court briefly notes that the Lessor/Dealer is listed as Mercedes-Benz of Calabasas, however, MBUSA is explicitly named as a third-party beneficiary of the Lease. (See Montemayor v. Ford Motor Co. (2023) 92 Cal.App.5th 958, 973 ["A third-party beneficiary is someone who may enforce a contract because the contract is made expressly for his benefit. [Citation.] The test for determining whether a contract was made for the benefit of a third person is whether an intent to benefit a third person appears from the terms of the contract. [Citation.]

The mere fact that a contract results in benefits to a third party does not render that party a third-party beneficiary. [Citation]."].) (See also Goonewardene v. ADP, LLC (2019) 6 Cal.5th 817, 830 ["[C]ourt has carefully examined the express provisions of the contract at issue, as well as all of the relevant circumstances under which the contract was agreed to, in order to determine not only (1) whether the third party would in fact benefit from the contract, but also (2) whether a motivating purpose of the contracting parties was to provide a benefit to the third party, and (3) whether permitting a third party to bring its own breach of contract action against a contracting party is consistent with the objectives of the contract and the reasonable expectations of the contracting parties.

All three elements must be satisfied to permit the third party action to go forward."].)

Accordingly, MBUSA has met its initial burden that a valid agreement to arbitrate Plaintiff's Song-Beverly Act ("SBA") claims exists.

Enforceability of the Agreement

As mentioned above, Plaintiff has not opposed the present motion, despite being served with the moving and supporting papers. (See POS re MTC Arb. at p. 11.) Nonetheless, the Court does not have jurisdiction to decide any "gateway" issue including, without limitation, arguments as to procedural and substantive unconscionability because the arbitration provision contains a delegation clause. (See Rent-A-Center, West, Inc. v. Jackson (2010) 561 U.S. 63, 68-69 ["The delegation provision is an agreement to arbitrate threshold issues concerning the arbitration agreement. We have recognized that parties can agree to arbitrate 'gateway' questions of 'arbitrability,' such as whether the parties have agreed to arbitrate or whether their agreement covers a particular controversy."].)

Although this argument was not made in the instant motion, the arbitration provision expressly states: " Any claim or dispute, whether in contract, tort, or otherwise (including any dispute over the interpretation, scope, or validity of this lease, arbitration section or the arbitrability of any issue), between you and us or any of our employees, agents, successors, assigns, or the vehicle distributor, including Mercedes-Benz USA, LLC (each a "Third Party Beneficiary"), which arises out of or relates to a credit application, this lease, or any resulting transaction or relationship arising out of this lease (including any such relationship with third parties who do not sign this contract) shall, at the election of either you, us, or a Third Party Beneficiary, be resolved by a neutral binding arbitration and not by a court action. " (Allison Decl., P.2, Ex.

A at p. 4 [emphasis added].) This is the exact type of delegation clause discussed in Rent-A-Center, West, Inc. v. Jackson (2010) 561 U.S.

63.

IV. CONCLUSION

Based on the foregoing, Defendant Mercedes-Benz USA, LLC's Motion to Compel Arbitration is GRANTED. The case is ordered stayed pending binding arbitration as to the entire action. Post-Arbitration Status Conference is scheduled for March 3, 2026 at 8:30 AM in Department I at Van Nuys Courthouse East. The parties are ordered to file at least five (5) court days in advance, a brief joint statement with an arbitration status update including whether either party is seeking a continuance of the hearing. Moving party to give notice.

Dated: August 31, 2026 __________________________________ Hon. Karen Moskowitz Judge of the Superior Court | Home -->)" -->