Yiting Zhao et al v. Dr. Yueyue Guo, Lac et al.

SUPERIOR COURT, STATE OF CALIFORNIA COUNTY OF SANTA CLARA Department 12 Honorable Nahal Iravani-Sani, Presiding Courtroom Clerk, Ryan Nguyen 191 North First Street, San Jose, CA 95113 Telephone: (408) 882-2230

DATE: 09/04/2026 TIME: 9:00 A.M. and 9:01 A.M.

LINE # CASE # CASE TITLE RULING LINE 1 17CV320200 Pedro Tostado Diaz et. MOTION TO ENFORCE SETTLEMENT al v. Luis Santiago et al. Please Ctrl Click (or scroll down to) Line 1 LINE 2 24CV453642 Williams Herrera MOTION FOR SUMMARY ADJUDICTION Arenas v. Please Ctrl Click (or scroll down to) Line 2 Ford Motor Company et al. LINE 3 25CV456971 Toeniskoetter MOTION TO EXPUNGE MECHANICS LIEN Constuction, Inc. v. VitroLabs Inc Notice of entry of dismissal filed 8/28/26 – Off Calendar LINE 4 25CV465349 Yiting Zhao et al PETITION TO COMPEL ARBITRATION v. Dr. Yueyue Guo, Lac et al. Please Ctrl Click (or scroll down to) Line 4 LINE 5 25CV476583 Jason Adair MOTION TO COMPEL DISCOVERY v. Elisity, Inc. Please Ctrl Click (or scroll down to) Lines 5-8 LINE 6 LINE 7 LINE 8 LINE 9 LINE 10 LINE 11 LINE 12

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Calendar line 4 Case Name: Zhao et al. v. Guo et al. Case No.: 25CV465349

DEFENDANTS’ MOTION TO STAY AND PETITION TO COMPEL ARBITRATION

This matter arises from a medical malpractice action brought by Plaintiffs Yiting Zhao (“Ms. Zhao”) and Tian Tian (“Mr. Tian”) (collectively “Plaintiffs”) against Defendants Chuntian Acupuncture Clinic, Inc. (“CAC”) and Yueyue Guo, L.A.c. (“Dr. Guo”) (collectively “Defendants”). Plaintiffs allege that Defendants negligently rendered acupuncture and related therapeutic treatment to Ms. Zhao in May 2024 in connection with the treatment of her preexisting knee injuries. (Complaint at p. 4.) Plaintiffs allege Defendants utilized a smoke-free moxibustion appliance that allegedly caused Ms.

Zhao third-degree burns on her knees. (Ibid.) Ms. Zhao alleges that, as a result, she sustained significant injuries requiring multiple debridement procedures domestically and abroad, as well as ongoing physical pain, emotional distress, and limitations in her mobility and daily functioning. (Ibid.) Mr. Tian alleges loss of consortium as a result of his wife's injuries. (Ibid.)

Defendants petition the Court to compel arbitration of Plaintiffs' claims pursuant to an Arbitration Agreement (“Agreement”) executed by Ms. Zhao as a condition of treatment. Plaintiffs do not dispute the existence or scope of the arbitration agreement. Instead, Plaintiffs contend that the fee-sharing provision is unconscionable because it requires them to bear arbitration costs that they cannot afford.

Plaintiffs have submitted declarations and supporting documentation concerning their financial condition and ability to pay their anticipated share of the arbitration costs. Defendants have had an opportunity to respond.

Having reviewed the parties' submissions, the Agreement, and the applicable law, the Court finds that additional limited evidence concerning Plaintiffs' present financial ability to pay is appropriate before the Court determines whether Plaintiffs are unable to pay their anticipated share of the reasonable costs of arbitration. The hearing is therefore continued for that limited purpose.

OBJECTIONS TO EVIDENCE

Defendants' objection to the Declaration of Yiting Zhao is DISREGARDED. The Court does not rely on the challenged portion of the declaration in this ruling.

Defendants' objection to the Declaration of Tian Tian is DISREGARDED. The Court does not rely on the challenged portion of the declaration in this ruling.

Defendants' Objections Nos. 1 and 2 to the Declaration of Daniel J. Libbey are SUSTAINED. Plaintiffs rely on the American Arbitration Association (“AAA”) and Judicial Arbitration and Mediation Services (“JAMS”) rules in estimating arbitration costs. The Agreement, however, specifically provides that the ADR Services, Inc. rules shall govern.

PROCEDURAL MATTERS

Under the California Arbitration Act (“CAA”) (Code Civ. Proc., §§ 1280-1294.2), “[a] copy of the petition and a written notice of the time and place of the hearing thereof and any other papers upon which the petition is based shall be served” as provided by statute. (Code Civ. Proc., § 1290.4, subd. (a).) A response generally must be served and filed within 10 days after service of the petition, subject to extension by written agreement or court order for good cause. (Code Civ. Proc., § 1290.6.) If a response is not duly served and filed, the allegations of the petition may be deemed admitted. (Code Civ. Proc., § 1290.)

Defendants served their petition to compel arbitration on November 14, 2025. On May 26, 2025, Plaintiffs filed “Proposals as to Content of Statement of Decision” nine days after Defendants filed their memorandum of points and authorities in support of the petition to compel arbitration. Therein, Plaintiffs did not oppose the petition to compel arbitration, but instead requested that the Court make no findings concerning the merits of Plaintiffs' claims or Defendants' defenses. (Plaintiffs' Proposals Re Statement of Decision at p. 2:3-6.)

On June 1, 2026, Plaintiffs filed an opposition to Defendants' petition to compel arbitration. Defendants contend the opposition is untimely under Code of Civil Procedure section 1290.6. Plaintiffs filed their opposition pursuant to Code of Civil Procedure section 1005, subdivision (b), nine court days before the hearing.

Courts have held that a trial court may consider an untimely response where no prejudice is shown, without a formal order extending the 10-day period. (Ruiz v. Moss Bros. Auto Group, Inc. (2014) 232 Cal.App.4th 836, 847.) Good cause may exist where the petition is treated as a motion rather than a petition. (Ibid.) It is also recognized that, where an action is already pending, an application to compel arbitration may be treated in practice as a motion. (Mercury Ins. Group v. Superior Court (1998) 19 Cal.4th 332, 349; Correia v. NB Baker Electric, Inc. (2019) 32 Cal.App.5th 602, 613.)

Here, a complaint was filed before Defendants sought to compel arbitration. Defendants filed and served reply papers five court days before the hearing in accordance with Code of Civil Procedure section 1005, subdivision (b). Defendants therefore had an opportunity to respond to Plaintiffs' arguments and have not demonstrated prejudice resulting from the timing of the opposition.

Accordingly, the Court treats the petition as a motion for purposes of the timing of Plaintiffs' opposition. Good cause exists to consider the opposition, and the Court declines to deem the allegations of the petition admitted.

LEGAL STANDARD

Defendants contend the Federal Arbitration Act (“FAA”) governs the Agreement because their operations affect interstate commerce. The FAA applies to contracts evidencing transactions “involving commerce,” a term construed broadly to extend to the full reach of Congress's Commerce Clause authority. (9 U.S.C. § 2; Nieto v. Fresno Beverage Co. (2019) 33 Cal.App.5th 274, 279; Citizens Bank v. Alafabco, Inc. (2003) 539 U.S. 52, 56-57.)

In Scott v. Yoho (2016) 248 Cal.App.4th 392, 401-402, the court found sufficient interstate-commerce contacts in a California medical practice based on, among other things, the practice's use of medical supplies originating outside California, Internet advertising and communications with out-of-state patients, and contacts with out-of-state companies.

Here, CAC purchases supplies and equipment from vendors located both inside and outside California, receives shipments through interstate commercial carriers, processes payments through interstate banking and credit-card networks, procures professional liability insurance through out-of-state entities, and conducts business communications and transactions through Internet-based and interstate telecommunications systems. (Declaration of Wing Yang- Vivian Ip, ¶ 19.) The Court finds these activities sufficient to establish the requisite nexus with interstate commerce. The FAA therefore governs the Agreement.

Under the FAA, the Court's role generally is limited to determining “(1) whether a valid agreement to arbitrate exists, and if it does (2) whether the agreement encompasses the dispute at issue.” (Chiron Corp. v. Ortho Diagnostic Systems, Inc. (9th Cir. 2000) 207 F.3d 1126, 1130.) State-law principles governing contract formation apply to the first inquiry. (Davis v. Nordstrom, Inc. (9th Cir. 2014) 755 F.3d 1089, 1093.)

The CAA similarly provides that, upon a petition alleging the existence of a written arbitration agreement and a refusal to arbitrate, the Court shall order arbitration if it determines that an agreement to arbitrate the controversy exists, unless the right to compel arbitration has been waived or grounds exist for rescission. (Code Civ. Proc., § 1281.2.)

In determining whether an arbitration agreement exists, courts employ a burden-shifting framework. The party seeking arbitration bears the initial burden of producing prima facie evidence of a written agreement to arbitrate. If that burden is met, the burden shifts to the opposing party to identify a factual dispute concerning the agreement's existence. If such a dispute is established, the burden shifts back to the proponent of arbitration to prove the existence of a valid agreement by a preponderance of the evidence. (Iyere v. Wise Auto Group (2023) 87 Cal.App.5th 747, 755; Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, 1060.)

ANALYSIS

There Is a Valid Agreement to Arbitrate

A valid agreement to arbitrate exists between the parties.

The moving party may meet its initial burden by attaching a copy of an arbitration agreement purporting to bear the opposing party's signature. (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158.) Defendants attached the Agreement to their petition. The Agreement was signed by Ms. Zhao on November 16, 2022. (Petition to Compel Arbitration, Ex. A.) A party may expressly accept an agreement to arbitrate by signing it. (Mendoza v. Trans Valley Transport (2022) 75 Cal.App.5th 748, 777.)

Ms. Zhao does not dispute signing the Agreement or otherwise establish a factual dispute concerning its formation. Defendants have therefore established the existence of a valid agreement to arbitrate.

Plaintiffs' Claims Fall Within the Scope of the Agreement

The scope of the agreement is covered by Plaintiffs’ claims. Here the Arbitration Agreement provides that it applies to:

. . . any dispute as to medical malpractice, that is as to whether any medical services rendered under this contract were unnecessary or unauthorized or were improperly, negligently, or incompetently rendered, will be determined by submission to arbitration as provided by California and federal law, and not by a lawsuit or resort to court process except as California and federal law provide for judicial review of arbitration proceedings.

(Petition to Compel Arbitration, Ex. A at Article 1.)

In this action, Plaintiffs bring the sole cause of action for professional negligence and assert that Dr. Guo’s use of a smoke-free moxibustion appliance caused Ms. Zhao third-degree burns on both her of her knees. (Complaint at p. 4.) Plaintiffs allege “as a result of Defendants’ negligent use of this machine—without appropriate assessment, informed consent, or precaution—Plaintiff Zhao sustained significant injuries requiring multiple debridement procedures both domestically and abroad.” (Ibid.) Thus, Plaintiffs claim for medical malpractice rests on the allegation that medical services were negligently rendered and is encompassed by the Arbitration Agreement.

To the extent Mr. Tian alleges a claim for loss of consortium, that is also encompassed by the Arbitration Agreement. The Agreement specifically provides, “[i]t is the intention of the parties that this agreement bind all parties as to all claims, including claims arising out of or relating to treatment or services provided by the healthcare provider including any heirs or past, present, or future spouse(s) of the patient in relation to all claims including loss of consortium.” (Petition to Compel Arbitration, Ex. A at Article 2.) The Agreement further states, “[a]ll claims for monetary damage . . . must be arbitrated including, without limitation, claims for loss of consortium . . . .” (Ibid.) Therefore, all of Plaintiffs’ claims are covered by the scope of the Agreement.

The Delegation Clause Is Clear and Unmistakable

The parties may agree to delegate questions of arbitrability to the arbitrator. Such an agreement will be enforced where there is “clear and unmistakable” evidence that the parties intended to delegate arbitrability. (First Options of Chicago, Inc. v. Kaplan (1995) 514 U.S. 938, 943-945.)

Here, Article 2 of the Agreement provides:

“[A]ny dispute that does not relate to medical malpractice, including as to whether or not a dispute is subject to arbitration, as to whether this agreement is unconscionable, and any procedural disputes, will also be determined by submission to binding arbitration.”

The language clearly and unmistakably delegates questions concerning arbitrability and the enforceability of the arbitration provision to the arbitrator.

Under Aanderud v. Superior Court (2017) 13 Cal.App.5th 880, 895-898, where a delegation provision is clear and unmistakable, a challenge to the arbitration agreement generally must be directed specifically to the delegation provision itself for the Court to decide the challenge. Plaintiffs have not established that the delegation provision itself is unconscionable.

The Court therefore does not decide Plaintiffs' general unconscionability challenge to the Agreement. That issue, to the extent it remains at issue, is delegated to the arbitrator. The Court likewise makes no determination concerning the merits of Plaintiffs' claims or Defendants' defenses. Those matters are properly addressed in arbitration.

Plaintiffs' Present Ability to Pay Arbitration Costs

Plaintiffs also contend that they cannot afford the arbitration costs required by the Agreement. This issue requires separate consideration.

The Agreement provides: “Each party to the arbitration shall pay such party's equal share of the expenses and fees of the neutral arbitrator, together with other expenses of the arbitration incurred or approved by the neutral arbitrator, not including counsel fees, witness fees, or other expenses for such party's own benefit.”

The provision is consistent with the default allocation rule in Code of Civil Procedure section 1284.2, which generally requires each party to pay its pro rata share of arbitration expenses unless the agreement provides otherwise. Section 1284.2, however, does not resolve whether enforcement of that allocation would effectively deny a party access to the arbitral forum because of an inability to pay.

California courts have recognized that arbitration cannot be enforced in a manner that effectively deprives a party of any forum for resolution of his or her claims because the party cannot afford the costs of arbitration. (Gutierrez v. Autowest, Inc. (2003) 114 Cal.App.4th 77, 90-91; Roldan v. Callahan & Blaine (2013) 219 Cal.App.4th 87, 94-96; Penilla v. Westmont Corp. (2016) 3 Cal.App.5th 205, 218.)

The party resisting arbitration bears the burden of demonstrating that the anticipated arbitration costs are likely to be prohibitive. (Penilla, supra, 3 Cal.App.5th at p. 218; Green Tree Financial Corp.-Alabama v. Randolph (2000) 531 U.S. 79, 92.)

In Roldan, the Court of Appeal directed the trial court to: (1) estimate the reasonable cost of the arbitration; (2) determine whether the plaintiffs were financially able to pay their anticipated share; and (3) if a plaintiff was unable to do so, give the party seeking arbitration

the option of paying that plaintiff's share or waiving its right to arbitrate that plaintiff's claims. (Roldan, supra, 219 Cal.App.4th at p. 90.)

More recently, Sanchez v. Superior Court (2025) 108 Cal.App.5th 615 reaffirmed Roldan and clarified that relief based upon a party's present inability to pay arbitration fees and costs is distinct from a determination that an arbitration agreement was unconscionable when made. Thus, even if a party cannot establish that it lacked the ability to pay when the agreement was executed, a present inability to pay arbitration fees and costs may warrant relief. (Sanchez, supra, 108 Cal.App.5th at pp. 633-636.)

Accordingly, the Court must determine both the reasonable anticipated cost of the arbitration and whether Plaintiffs are presently financially able to pay their anticipated share.

Anticipated Cost of Arbitration

Plaintiffs' estimates based upon the AAA and JAMS rules are not applicable because the Agreement expressly provides that the ADR Services, Inc. rules shall govern. (Petition to Compel Arbitration, Ex. A, Art. 3.)

ADR Services, Inc.'s fee schedule provides for a $450 initial filing fee and $975 administrative fee. (Trobough Decl., Ex. A.)

Plaintiffs have not established a sufficient basis for assuming a five-day evidentiary hearing. This action involves a single professional-negligence claim and a derivative loss-ofconsortium claim arising from a single event. The Court therefore finds that two evidentiary hearing days is a more reasonable estimate for purposes of determining the anticipated cost. Plaintiffs likewise have not established a basis for assuming that an arbitrator charging $9,000 per day will necessarily be selected. Defendants acknowledge that approximately $600 per hour is a more typical rate, although they identify a $9,000 daily rate at the higher end of the range. (Trobough Decl., ¶ 27.)

Defendants estimate the total arbitration costs to be approximately $18,825 to $27,225, consisting of $1,425 in filing and administrative fees, $12,000 to $18,000 for two hearing dates, $2,400 to $3,600 for four to six hours of pre-hearing arbitrator time, $1,800 to $2,400 for three to four hours of award preparation and post-hearing time, and $1,200 to $1,800 for two to three hours of other arbitrator time. (Id., ¶¶ 29-30.)

The Court finds this range reasonable for purposes of the present analysis. Plaintiffs' anticipated pro rata share is therefore approximately $9,412.50 to $13,612.50.

Plaintiffs' Financial Circumstances

Plaintiffs have submitted evidence concerning their current financial circumstances.

Plaintiffs collectively receive approximately $12,108.12 in monthly income. (Declaration of Yiting Zhao, Ex. 2; Declaration of Tian Tian, ¶ 5.) Their mortgage, vehicle loan payments, property taxes, homeowners' and automobile insurance, homeowners' association dues, and utilities total approximately $11,673.82 per month, leaving

approximately $326.18 before food, gasoline, medical care, and other necessary household expenses. (Zhao Decl., Ex. 3; Tian Decl., ¶¶ 6-7.) Plaintiffs have approximately $6,129 in checking and savings accounts. (Zhao Decl., Ex. 4; Tian Decl., ¶ 11.) Ms. Zhao also reports approximately $11,218.48 in lost income and approximately $61,763.84 in medical expenses, although some of those charges have been paid or adjusted by insurance. This evidence constitutes a substantial showing that Plaintiffs have limited liquid resources and that their ordinary monthly expenses consume virtually all of their reported household income. Their reported liquid savings are less than even the low end of their anticipated share of arbitration costs.

The evidence is not yet sufficient, however, to permit the Court to determine whether Plaintiffs are presently unable to pay their anticipated share. Plaintiffs own a residence, but the record does not disclose its current fair-market value, the outstanding mortgage balance, or the amount of equity. The record also does not adequately identify whether Plaintiffs have other significant assets or readily available investment resources.

The Court does not require Plaintiffs to establish indigency, nor does it require disclosure of every aspect of their financial affairs. The question is whether Plaintiffs are presently financially able to pay their anticipated share of the reasonable cost of arbitration. Ownership of a residence does not, standing alone, establish an ability to pay; conversely, the existence of substantial accessible equity or other liquid assets could be relevant to the inquiry.

The Court therefore finds that a limited supplementation of the financial record is appropriate.

Plaintiffs shall provide the following:

1. Residence. A declaration stating the approximate current fair-market value of the residence, the outstanding balance of the mortgage and any other liens, and the resulting approximate equity.

2. Other significant assets. A declaration identifying any significant non-retirement liquid or readily accessible assets, including investment or brokerage accounts, and their approximate current values.

3. Significant debts or obligations. A declaration identifying significant outstanding debts or obligations, particularly obligations arising from medical expenses or other necessary expenses, that materially affect Plaintiffs' ability to pay the anticipated arbitration costs.

4. Current income and liquid assets. Current documentation reasonably supporting the reported household income and checking/savings balances, such as recent pay statements and current account statements, to the extent such documentation has not already been submitted.

Plaintiffs need not submit complete tax returns or documentation of every retirement account at this time. Plaintiffs shall, however, identify any retirement or other assets that are reasonably accessible and material to their ability to pay. Assets subject to substantial withdrawal restrictions, tax consequences, or penalties need not be treated as equivalent to readily available cash without further evidence.

Defendants may submit evidence disputing the reasonableness of the anticipated arbitration costs or Plaintiffs' claimed inability to pay.

The Court will determine the issue based upon the supplemental declarations and documentary evidence unless the parties demonstrate a material factual dispute requiring an evidentiary hearing.

Effect of the Court's Determination

The Court does not presently determine that the arbitration agreement or its fee-sharing provision is unconscionable. The Agreement contains a clear and unmistakable delegation clause, and Plaintiffs have not demonstrated that the delegation clause itself is unconscionable. (Aanderud, supra, 13 Cal.App.5th at pp. 895-898.) The Court's present inquiry instead concerns Plaintiffs' ability to pay the anticipated costs of arbitration. As Roldan and Sanchez recognize, present inability to pay arbitration costs is a distinct issue from whether the arbitration agreement was unconscionable when entered into.

If the Court determines that one or both Plaintiffs are unable to pay their anticipated share, Defendants shall be afforded the option of either paying the affected Plaintiff's share of the reasonable arbitration costs or waiving their right to arbitrate that Plaintiff's claims. (Roldan, supra, 219 Cal.App.4th at p. 90.) If Defendants decline to pay and instead waive arbitration, the affected claims may proceed in this Court. (Hang v. RG Legacy, LLC (2023) 88 Cal.App.5th 1243, 1255.)

CONCLUSION

The petition to compel arbitration is CONTINUED to November 13, 2026. Plaintiffs' supplemental declaration and supporting documentation shall be filed and served by October 22, 2026. Defendants' response, if any, shall be filed and served by November 2, 2026.The supplemental submissions shall be limited to the issues identified above.

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