Duick v. Toyota Motor Sales, U.S.A., Inc.
198 Cal. App. 4th 1316
Cal. Ct. App.2011Background
- Duick participated as player 2 in the Your Other You campaign tied to Toyota Matrix; the campaign sent emails from an unknown person inviting participation.
- Participants clicked a Begin link on a page titled Personality Evaluation, then viewed Terms and Conditions to continue the experience.
- The Terms and Conditions were drafted by defendants and contained an arbitration clause restricting disputes to individual arbitration in Los Angeles under the AAA Rules.
- Duick alleges she did not read or could not read the terms fully, and the text was allegedly unreadable for technical reasons.
- Duick was subjected to a prank-promoted campaign with alarming emails from a persona and a final reveal video showing the prank as Toyota advertising; she filed suit asserting multiple claims seeking damages.
- The trial court denied defendants’ motion to compel arbitration; on appeal, the issue is whether the putative contract was void due to fraud in inception, making arbitration unenforceable.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether arbitration is enforceable given fraud in inception | Duick argues the contract is void ab initio due to fraud in inception | Toyota/Saatchi contend the agreement is valid and arbitration should apply | Contract void for fraud in inception; arbitration clause unenforceable |
Key Cases Cited
- Rosenthal v. Great Western Fin. Securities Corp., 14 Cal.4th 394 (Cal. 1996) (fraud in inception can void the entire contract; misrepresentation may render assent unavailable)
- Jones v. Adams Financial Services, 71 Cal.App.4th 831 (Cal. App. 1999) (misrepresentation can affect mutual assent in contracts)
- Larian v. Larian, 123 Cal.App.4th 751 (Cal. App. 2004) (fraud/inception considerations in contract formation)