54 Cal.App.5th 238
Cal. Ct. App.2020Background
- Moritz produced entries in the Fast & Furious franchise under seven written producer contracts; the first six contain arbitration clauses and the FF8-10 contract incorporates modified FF7 terms for "sequels" or "remakes."
- Universal developed a spin-off, Hobbs & Shaw; the parties exchanged draft producer agreements (including a proposed arbitration clause) but never signed a contract for that film.
- Moritz alleges an oral producer agreement for Hobbs & Shaw (modeled on the FF8-10/FF7 financial terms); Universal maintained no binding deal existed and instructed Moritz not to work on the picture.
- Moritz sued for breach of the alleged oral agreement; Universal moved to compel arbitration based on the arbitration clauses in the Fast & Furious written contracts.
- The trial court ruled the arbitration clauses did not cover the Hobbs & Shaw dispute and that the arbitrability question was for the court to decide; the court denied the motion to compel.
- The Court of Appeal affirmed, holding (1) there was no clear-and-unmistakable delegation of arbitrability with respect to Hobbs & Shaw, and (2) the Hobbs & Shaw dispute is not within the scope of the Fast & Furious arbitration clauses.
Issues
| Issue | Moritz (Plaintiff) | Universal (Defendant) | Held |
|---|---|---|---|
| Who decides arbitrability (delegation clause)? | Court should decide; no clear delegation to arbitrator for Hobbs & Shaw. | Delegation clauses in the Fast & Furious contracts (and JAMS rules) send threshold arbitrability questions to an arbitrator. | Court: No clear-and-unmistakable delegation applicable here; court decides arbitrability for Hobbs & Shaw. |
| Does the Hobbs & Shaw dispute fall within the scope of the Fast & Furious arbitration clauses? | Dispute arises from an alleged oral agreement for a non‑sequel spin‑off and is unrelated to the written Fast & Furious contracts, so not arbitrable. | Arbitration clauses cover any controversy "arising out of or relating to" the agreements (and, defendants say, include disputes about the agreement to arbitrate). | Court: Not arbitrable — Hobbs & Shaw is neither a sequel/remake covered by the FF8‑10/FF7 chain nor sufficiently related to make arbitration clause operative; mere reference to prior contracts is too tangential. |
Key Cases Cited
- Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (U.S. 2019) (parties may delegate arbitrability to arbitrator; rejected the "wholly groundless" exception)
- Granite Rock Co. v. Int'l Broth. of Teamsters, 561 U.S. 287 (U.S. 2010) (arbitration appropriate only where parties agreed to arbitrate the dispute)
- Litton Fin. Printing Div. v. NLRB, 501 U.S. 190 (U.S. 1991) (arbitration clause implements the underlying contract and does not transcend it)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (U.S. 1995) (ordinary contract‑formation principles apply to deciding whether parties agreed to arbitrate)
- AT&T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643 (U.S. 1986) (question of whether parties agreed to arbitrate is for courts absent clear delegation)
- Volt Info. Sciences, Inc. v. Board of Trustees of Leland Stanford Jr. Univ., 489 U.S. 468 (U.S. 1989) (arbitration is a matter of consent, not coercion)
- Allied‑Bruce Terminix Cos., Inc. v. Dobson, 513 U.S. 265 (U.S. 1995) (FAA applies to contracts "involving" interstate commerce)
- Coors Brewing Co. v. Molson Breweries, 51 F.3d 1511 (10th Cir. 1995) (example that unrelated tort claims are not covered by a commercial contract's arbitration clause)