Jahanmir vs. Mercedes Benz USA, LLC

The arguments regarding Cross-Complainant’s claims for unjust enrichment and constructive trust have been addressed in the demurrer. Cross-Complainants have adequately stated a claim for unjust enrichment, but have not stated a claim for imposition of a constructive trust. Accordingly, the court grants the motion as to paragraph 78, only.

Should Cross-Complainants wish to file an amended cross-complaint that addresses the issues in this ruling, Plaintiff must file and serve it within 30 days of service of notice of ruling.

Cross-Defendants shall give notice of both rulings.

3 Jahanmir vs. TENTATIVE RULING: Mercedes Benz USA, LLC For the reasons set forth below, Defendant Mercedes-Benz USA, LLC (MBUSA)’s motion to compel Plaintiff Kamran Jahanmir to binding arbitration and stay action is GRANTED.

The court DENIES Defendant’s request for judicial notice, as it was presented for the first time in the Reply. (Jay v. Mahaffey (2013) 218 Cal.App.4th 1522, 1538).

Statement of Law

A court shall order arbitration if it determines an agreement to arbitrate exists, unless the moving party waived arbitration, grounds exist for revocation of the agreement, or a party to the agreement is also a party to a pending action involving the same transaction with a third party and there is a possibility of conflicting rulings on a common issue of law or fact. (Code Civ. Proc., § 1281.2.) If the court orders arbitration, it shall, upon motion of either party, stay the action or proceeding until the completion of the arbitration, or until such earlier time as the court specifies. (Code Civ. Proc., § 1281.4; Thomas v. Westlake (2012) 204 Cal.App.4th 605, 620.)

There is a strong public policy favoring arbitration, and any doubts regarding arbitrability are resolved in favor of arbitration, “unless it can be said with assurance that an arbitration clause is not susceptible to an interpretation covering the asserted dispute.” (Rice v. Downs (2016) 248 Cal.App.4th 175, 185.) However, ordinary principles of contract interpretation apply, meaning the court must determine whether the parties agreed to arbitrate the claims at issue, the scope of the arbitration clause, and the terms of the arbitration clause. (Id.) In determining the applicability of an arbitration agreement, the court should attempt to give effect to the parties’ intentions, considering

the agreement as a whole, and in light of the usual and ordinary meaning of the language of the agreement. (Id. at pp. 185-186.)

The petitioner bears the burden of proving the existence of a valid arbitration agreement by a preponderance of the evidence, while a party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense, such as unconscionability. (Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223, 236.) The trial court sits as the trier of fact, weighing all the affidavits, declarations, and other documentary evidence, and any oral testimony the court may receive at its discretion, to reach a final determination. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972.).

Federal Arbitration Act

The arbitration provision provides: This lease evidences a transaction involving interstate commerce. Any arbitration under this lease shall be governed by the Federal Arbitration Act (9 USC 1, et seq). (Decl. of Newman, Ex. C.) The arbitration provision in the Warranty also provides that arbitration will be governed by the FAA. (Decl. of Newman, Ex. B).

See also Rodriguez v. Am. Technologies, Inc. (2006) 136 Cal.App.4th 1110, 1122: “Thus, there is no ambiguity regarding the parties' intent. They adopted the FAA—all of it—to govern their arbitration. The FAA controls ...”

Accordingly, the court finds that the FAA applies.

Existence of a Valid Agreement

A party moving to compel arbitration bears an initial 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, 165–166.) The moving party “can meet its initial burden by attaching to the [motion or] petition a copy of the arbitration agreement purporting to bear the [opposing party's] signature.” (Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541.) Alternatively, the moving party can meet its burden by setting forth the agreement's provisions in the motion. (Condee v. Longwood Management Corp. (2001) 88 Cal.App.4th 215, 219; see also Cal. Rules of Court, rule 3.1330 [“The provisions must be stated verbatim or a copy must be physically or electronically attached to the petition and incorporated by

reference.”].) For this step, “it is not necessary to follow the normal procedures of document authentication.” (Condee, supra, at 218.) If the moving party meets its initial prima facie burden and the opposing party does not dispute the existence of the arbitration agreement, then nothing more is required for the moving party to meet its burden of persuasion.

If the moving party meets its initial prima facie burden and the opposing party disputes the agreement, then in the second step, the opposing party bears the burden of producing evidence to challenge the authenticity of the agreement. (See Gamboa, supra, 72 Cal.App.5th at 165–166.)

In support of Defendant’s motion, Defendant presents the declaration of counsel, Daniell Newman, who presents two arbitration agreements: one found in the Warranty, and in the Lease Agreement that was signed by Plaintiff.

The Warranty provides the following:

“Individual Arbitration Agreement and Class Waiver... .. This agreement requires arbitration of any disputes between you and MBUSA (together the “Parties”) including, without limitation, claims and disputes related to or arising out of your vehicle purchase, use, or ownership except those soley for personal-injury claims....These include, without limitation, disputes arising out of your warranty, and claims arising before or after you signed this Agreement...” (Decl. of Newman, Ex. B).

The Motor Vehicle Lease Agreement (the “Agreement”) provides, in part:

“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.” (Decl. of Newman, Ex. C.) The Agreement was electronically signed by Plaintiff.

Plaintiff does not contest signing the Agreement. However, the Agreement provides that it is between Plaintiff, as Lessee, and the Lessor or “Mercedes-Benz Vehicle Trust.” Defendant MBUSA contends that it may still enforce the Agreement as a third-party beneficiary.

Third-Party Beneficiary

“Under certain circumstances, a nonsignatory to an arbitration agreement may seek to enforce it against a signatory. Whether such enforcement is permissible is a question of state law.” (Ford Motor Warranty Cases (2023) 89 Cal.App.5th 1324, 1332 (“Ochoa”) [citing Kramer v. Toyota Motor Corp. (9th Cir. 2013) 705 F.3d 1122, 1128; Thomas v. Westlake (2012) 204 Cal.App.4th 605, 614, fn. 7].) State law provides six theories by which a nonsignatory may compel or be bound to arbitrate. These theories include: “ ‘(a) incorporation by reference; (b) assumption; (c) agency; (d) veil-piercing or alter ego; (e) estoppel; and (f) third-party beneficiary’ [citations].” (Suh v. Superior Court (2010) 181 Cal.App.4th 1504, 1513).

When considering whether a third party may bring a breach of contract claim, courts 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.” (Goonewardene v. ADP, LLC (2019) 6 Cal.5th 817, 829-830).

As previously stated, the Agreement provides in part, that “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’)...”. (Ex. C).

Plaintiff contends that his claims against Defendant do not arise from this lease agreement, that Defendant does not directly benefit from the lease agreement between Plaintiff and the dealership, that the motivating purpose of any lease agreement between Plaintiff and the dealership was not to benefit Defendant, and that the Agreement

could not have been within the expectations of the contracting parties.

Plaintiff asks this court to follow Ford Motor Warranty Cases (April 4, 2023) 89 Cal.App.5th 1324 (Ochoa) in support of Plaintiff’s contentions that Plaintiff’s claims “have nothing to do with the Lease Agreement.” In Ochoa, the court found that FMC was not a thirdparty beneficiary where FMC was not named in the sale contracts, and where FMC did not satisfy the Goonewardene requirements. As the court held:

Its direct benefits are expressly limited to those persons who might rely on it to avoid proceeding in court—the purchaser, the dealer, and the dealer's employees, agents, successors or assigns. FMC is none of these. [¶] Second, there is no indication that a benefit to FMC was the signatories’ “motivating purpose”... [¶] ... Finally, allowing FMC to enforce the arbitration provision as a third party beneficiary would be inconsistent with the “reasonable expectations of the contracting parties

(Id. at 1339-40).

Notably, the court held: “Any interest FMC may have in where its dealers and consumers choose to resolve their disputes is remote and certainly not articulated in FMC's briefing. If the signatories had intended to benefit FMC, such a purpose would have been easy to articulate. They could have simply named FMC—directly or by class as the vehicle's manufacturer—as a person entitled to compel arbitration.” (Id. at 1339).

With regards to Plaintiff’s reliance on Ochoa in support of Plaintiff’s arguments that his claims have nothing to do with the Lease, this is an argument regarding equitable estoppel-which is a separate theory from third-party beneficiary.

“[T]he equitable estoppel doctrine applies when a party has signed an agreement to arbitrate but attempts to avoid arbitration by suing nonsignatory defendants for claims that are ‘based on the same facts and are inherently inseparable’ from arbitrable claims against signatory defendants.” (Metalclad Corp. v. Ventana Environmental Organizational Partnership (2003) 109 Cal.App.4th 1705, 1713 [internal citations and quotations omitted]). “Courts applying

equitable estoppel against a signatory have ‘ “looked to the relationships of persons, wrongs and issues, in particular whether the claims that the nonsignatory sought to arbitrate were ‘ “ ‘intimately founded in and intertwined with the underlying contract obligations.’ ” ’ ” (Id. [internal citations omitted]).

However, the three-part, third-party beneficiary analysis set forth in Goonewardene, supra, does not consider whether the Plaintiff’s claims are necessarily intertwined with the sales contract.

With regards to Defendant’s argument that it is expressly named in the contract as a third-party beneficiary, the court applies the analysis in Goonewardene.

With regards to the first two elements, whether the third party would in fact benefit from the contract, and whether a motivating purpose of the contracting parties was to provide a benefit to the third party, Defendant cites to Ford Motor Warranty Cases (2023) 89 Cal.App.5th 1324 where, again, the court noted that “[i]f the signatories had intended to benefit FMC, such a purpose would have been easy to articulate. They could have simply named FMC— directly or by class as the vehicle's manufacturer—as a person entitled to compel arbitration.

But they did not.” (Id. at 1339). Defendant contends that as Mercedes-Benz is explicitly named and recognized as a “Third-Party Beneficiary” in the Lease Agreement entitled to enforce arbitration, MBUSA would in fact benefit from the Lease Agreement. Similarly, that MBUSA was expressly named in the arbitration provision shows that the contracting parties purposefully provided that benefit to MBUSA, satisfying the second Goonewardene factor.

Regarding the third element-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- the expectations are consistent with Defendant’s position, where, as here, the Agreement specifically states that MBUSA is covered by the Agreement.

Accordingly, the court finds that MBUSA may enforce the arbitration provision as one of the entities explicitly named in the Agreement.

Plaintiff’s Claims

Plaintiff asserts claims for violation of: Civ. Code § 1793.2 (d), Civ. Code § 1793.2 (b), Civ. Code § 1793.2 (A)(3), and breach of the

implied warranty of merchantability. Plaintiff’s claims arise out of the warranty and implied warranty.

The court finds that Plaintiff’s claims against MBUSA entirely arise out of and relate to the warranty for the Vehicle, and the relationship between the parties as lessee and warrantor.

Contract of Adhesion

Finally, Plaintiff contends that the arbitration provision in the Agreement is a contract of adhesion. However, Plaintiff provides no evidence in support of this assertion.

Furthermore, the fact of an adhesion contract alone does not render the arbitration clause unenforceable. Procedural and substantive unconscionability “must both be present in order for a court to exercise its discretion to refuse to enforce a contract or clause under the doctrine of unconscionability.” (Armendariz v. Foundation Health Psychcare Servs., Inc. (2000) 24 Cal.4th 83, 114).

Therefore, the motion is GRANTED.

The court will STAY this action pending resolution of the parties’ arbitration. (See Code Civ. Proc., § 1281.2.)

The court sets an ADR Review Hearing for March 2, 2026, at 9:00 a.m. in this Department.

Defendant MBUSA shall give notice.

4 Anderson vs. OFF CALENDAR Tan 5 Cemex TENTATIVE RULING: Construction Materials Motion to Continue Judgment Debtor Examination Pacific, LLC vs. Gunner Concrete, Inc. Judgment Debtor Gunner Concrete, Inc. moves to continue the judgment debtor examination set for June 26, 2026. For the following reasons, the motion is DENIED.

First, the motion is moot. Gunner Concrete, Inc. moves to continue the judgment debtor examination that was set for June 26, 2026, to July or August 2026. However, that date has passed, and the motion is thus moot.

Further, the motion is not supported by a properly executed declaration because the declaration attached to the motion is not