Crown Asset Management, LLC v. Dinesh Kumar Purbey

Plaintiff filed suit on April 17, 2025 and alleges two causes of action for (1) breach of contract; and (2) money lent, paid, or expended.

Defendant now moves to compel arbitration under the arbitration clause of the Promissory Note (“the Agreement”) issued by FinWise Bank. The arbitration clause provides that it is governed by the Federal Arbitration Act (“FAA”) as follows: “I acknowledge agree that the Note involves interstate commerce and that this arbitration clause will be construed, applied, and governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq., (‘FAA’) as amended.” (Complaint, Ex. 2 at ¶ 17(A).) Having reviewed all the papers and considered all arguments presented by counsel, the Court rules that Defendant has shown the existence of a valid agreement to arbitrate, which covers all claims in this civil action. So the Motion is GRANTED.

Legal Standard on Motion to Compel Arbitration

Under the Federal Arbitration Act (“FAA”), the court’s role 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.) To determine “whether a valid contract to arbitrate exists,” courts apply “ordinary state law principles that govern contract formation.” (Davis v. Nordstrom, Inc. (9th Cir. 2014) 755 F.3d 1089, 1093 [citations omitted]; see also Ingle v. Circuit City Stores, Inc. (9th Cir. 2003) 328 F.3d 1165, 1170.)

Likewise, under California law:

On petition of a party to an arbitration agreement alleging the existence of a written agreement to arbitrate a controversy in that a party thereto refuses to arbitrate such controversy, the court shall order the petitioner and respondent to arbitrate the controversy if it determines that an agreement to arbitrate the controversy exists, unless it determines that: [¶] The right to compel arbitration has been waived by the petitioner; or [¶] (b) Grounds exist for rescission of the agreement . . . .

C.C.P. § 1281.2

In determining the threshold question of whether an arbitration agreement exists between the parties, the court employs a three-step burden shifting analysis. (Iyere v. Wise Auto Group (2023) 87 Cal. App. 5th 747, 755 (Iyere); see also Espejo v. Southern California Permanente Medical Group (2016) 246 Cal. App. 4th 1047, 1060.) The party seeking to compel arbitration bears the initial burden of showing an agreement to arbitrate. If that burden is met, the burden shifts to the opposing party to show a factual dispute regarding the agreement’s existence. If the opposing party does so, then the burden shifts back to the proponent of arbitration to show the existence of a valid agreement by a preponderance of the evidence. (Iyere, supra, 87 Cal.App.5th at p. 755.)

Analysis of the Motion to Compel Arbitration

1. There is a Valid Agreement to Arbitrate between these parties.

The Court finds that a valid agreement to arbitrate exists between these parties. The moving party bears the burden of producing a written agreement to arbitrate. The moving party can meet this prima facie burden by “attaching to the [motion or] petition a copy of the arbitration agreement purporting to bear the [opposing party’s] signature.” (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158.) Defendant has attached a copy of the Agreement containing the arbitration clause to its motion. While the Agreement bears only Defendant’s electronic signature, under California law a promissory note need not be signed by both parties to be enforceable. Rather, it need only be signed by the person undertaking to pay. (See Cal. U Com Code § 3103, subd. (a)(9).)

Here, Defendant has electronically signed the Agreement, which has the same legal effect as a handwritten signature. (Civil Code § 1633.7; Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, 1060.) Moreover, his signature evinces his express acceptance of the agreement to arbitrate. (Mendoza v. Trans Valley Transport (2022) 75 Cal.App.5th 748, 777.)

While the Promissory Note is executed by FinWise Bank and Defendant, the arbitration clause defines “Parties” as “any of our respective heirs, successors, assignees or related third parties, including Upstart, any other subsequent holder of my Note, and their affiliates, subsidiaries, and parents” who may choose to elect arbitration. (Complaint, Ex. 2 at ¶ 17(C).) The underlying Agreement also provides that Defendant promises to pay “FinWise or any subsequent holder or assignee of this Note,” the principal sum and interest on the account. (Id., Ex. 2 at ¶ 1.) Plaintiff is the current holder of the Note, and therefore, a party as defined under this Agreement. (Id. at ¶¶ 3, 8.)

Accordingly, a valid agreement to arbitrate exists between Plaintiff and Defendant, under which the Defendant is entitled to seek to compel arbitration against Plaintiff under its arbitration clause. Moreover, Plaintiff has utterly failed to show any factual dispute regarding the arbitration agreement’s existence because Plaintiff has failed to oppose the Motion at all. (See Rule of Court 8.54(c): “A failure to oppose a motion may be deemed a consent to the granting of the motion.” CRC Rule 8.54(c).)

2. The Scope of the Arbitration Clause Covers all claims of Plaintiff in this civil action.

The arbitration clause broadly defines “Dispute” to include claims related to:

any relationship resulting from, or activities connected to this Note; my application; information I have provided to you; information and disclosures you have provided to me; any prior agreements between you and me; extensions; renewals; refinancings; payment plans; underwriting; servicing; collections; privacy; and customer information. The term “Dispute” also includes: claims under federal or state consumer protection laws; claims in tort or contract; claims under statutes or common law; claims at law or in equity; other past, present, or future claims, counterclaims, cross-claims, third party claims, interpleaders, or otherwise; and any claim relating to the interpretation, applicability, enforceability or formation of this arbitration clause, including, any claim that all or any part of this arbitration clause, except paragraph G below, is void, voidable or unconscionable.

(Complaint, Ex. 2 at ¶17(B).)

Here, Plaintiff’s claims are for breach of contract and money, lent, paid, or expended. They relate to the enforcement of the Note. Plaintiff’s allegations are that Defendant breached the terms and conditions by failing to pay the amount due on the

account and that he is indebted for money lent or paid out for his benefit. (Complaint at ¶¶ 17, 20.) The outstanding balance on the account is $14,424.74 which has not been paid. (Id. at ¶ 21.) Plaintiff’s causes of action are common law claims that inherently relate to the Note. Accordingly, in light of its broad definition of Dispute set forth above, all Plaintiff’s claims in this case fall within the scope of the arbitration clause of the Agreement.

Plaintiff does not argue otherwise. Indeed, Plaintiff has not filed any opposition whatever. The failure to timely file an opposition is a basis for the Court to grant the motion, as the Court may construe such non-opposition as a concession that the motion is meritorious. (See D.I. Chadbourne, Inc. v. Super. Ct. (1964) 60 Cal.2d 723, 728, fn. 4.; see also Rule of Court 8.54(c): “A failure to oppose a motion may be deemed a consent to the granting of the motion.” CRC Rule 8.54(c).)

Accordingly, the Court GRANTS the Motion to Compel Arbitration. This civil action is STAYED in its entirety pending the conclusion of this arbitration. (Code Civ. Proc. § 1281.4; 9 U.S.C. § 3.)

Conclusion and Order

The Motion to Compel Arbitration is GRANTED. The Court ORDERS:

1. The parties now arbitrate all claims of Plaintiff; and

2. This civil action is STAYED until this arbitration is complete.

SO ORDERED.

Date: May 29, 2026 Hon. Vincent I. Parrett Superior Court of the State of California, County of Santa Clara

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