Jessica Kramer v. Toyota Motor Corporation
2013 U.S. App. LEXIS 2090
| 9th Cir. | 2013Background
- Toyota seeks to review the district court's denial of its motion to compel arbitration.
- District court held Toyota, a nonsignatory to Purchase Agreements, could not compel arbitration and had no waiver to arbitrate.
- Plaintiffs are owners of 2010 Prius/HS 250h alleging ABS defects and various California-law claims.
- Purchase Agreements with arbitration clauses between Plaintiffs and Dealerships; Toyota is not a signatory.
- District court concluded the arbitration clauses were limited to Plaintiffs and Dealerships, not Toyota.
- Supreme Court decision in Concepcion and subsequent AAA doctrine frame the arbitration issues as contract-based.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Authority to decide arbitrability. | Plaintiffs argued courts decide arbitrability when not clearly agreed to arbitrate. | Toyota argued the arbitrator should decide arbitrability per contract terms. | District court had authority to decide arbitrability; no clear evidence of agreement to arbitrate it. |
| Equitable estoppel to compel arbitration by a nonsignatory. | Claims are not intertwined with Purchase Agreements; estoppel should not apply. | Plaintiffs’ claims are intimately founded in or interdependent with the agreement. | Equitable estoppel does not apply; claims are not intertwined with the Purchase Agreements. |
| Waiver of arbitration rights. | N/A | Nonsignatory's waiver by years of litigation should bar arbitration. | Waiver issue not reached; affirmed on authority and estoppel grounds. |
Key Cases Cited
- Granite Rock Co. v. Int'l Bhd. of Teamsters, 130 S. Ct. 2847 (U.S. 2010) (who decides arbitrability is generally a judicial question)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (U.S. 1995) (courts should not assume arbitrability unless clear evidence)
- Arthur Andersen LLP v. Carlisle, 556 U.S. 624 (U.S. 2009) (nonparties may invoke arbitration if state law allows)
- Goldman v. KPMG LLP, 173 Cal. App. 4th 209 (Cal. Ct. App. 2009) (equitable estoppel requires claims intertwined with contract obligations)
- Mundi v. Union Security Life Ins. Co., 555 F.3d 1042 (9th Cir. 2009) (nonsignatory must show intertwined or arising out of the contract)
- Jones v. Jacobson, 195 Cal. App. 4th 1 (Cal. Ct. App. 2011) (intertwined with underlying contract for equitable estoppel analysis)
- MS Dealer Serv. Corp. v. Franklin, 177 F.3d 942 (11th Cir. 1999) (federal equitable estoppel considerations in arbitration)
- Concepción, 131 S. Ct. 1740 (U.S. 2011) (class action waivers in consumer arbitration enforceable)