Kirk v. RatnerKirk v. Ratner
Fagelbaum & Heller, Jerold Fagelbaum and Philip Heller for Plaintiffs and Appellants Charlotte Kirk and Neil Marshall.
Lavely & Singer, Martin D. Singer, Michael E. Weinsten and Allison S. Hart for Defendants and Respondents Brett Ratner, Kevin Tsujihara, James Packer and Avi Lerner.
Charlotte Kirk, an actress, using the pseudonym Melissa Parker, entered into a confidential settlement agreement in August 2017 with four entertainment industry executives, Brett Ratner, Kevin Tsujihara, James Packer and Avi Lerner, using the fictitious names Clark Grandin, Bruce Hamilton, Gregory Kemp and Walter Nelson in the agreement and documents filed in the superior court. The agreement contained an arbitration clause.
The executives filed a demand for arbitration in June 2020, naming Kirk (as Parker) and Neil Marshall (actual name), Kirk‘s fiancé, and two others as respondents, asserting claims for breach of contract, interference with contract and civil extortion. The executives obtained from an emergency arbitrator a preliminary injunction prohibiting Kirk, Marshall and the other respondents from disclosing confidential information as that term is defined in the settlement agreement, including any disclosures in court documents, and from initiating any lawsuit against the executives in violation of the arbitration provisions in the settlement agreement.
Kirk (as Parker) and Marshall filed a petition in superior court to vacate the preliminary injunction. Because the emergency arbitrator‘s ruling was not an
We notified the parties pursuant to
Kirk and Marshall, who challenge the validity of the confidentiality provisions in the settlement agreement, said they only filed the material under seal because they did not want the executives to accuse them of violating the settlement agreement and the preliminary injunction.
For their part, the executives first contended, incorrectly, if the superior court‘s order was not appealable, we would lack jurisdiction to decide whether documents in the appellate record should remain sealed. (See H.B. Fuller Co. v. Does, supra, 151 Cal.App.4th at p. 889 [“[t]his court is master of its own files“].) The executives next argued the contractual provision to keep the names of the parties and the terms of the agreement secret overrode the right of public access. (See
FACTUAL AND PROCEDURAL BACKGROUND
1. The Confidential Settlement Agreement
Following two days of mediation in August 2017 Kirk, Joshua Newton (using the pseudonym Matthew Waller) and the executives entered into a confidential settlement agreement and mutual release that fully resolved (with no admission of wrongdoing) Kirk‘s claims of sexual harassment, infliction
The settlement agreement‘s confidentiality provision prohibited Kirk and Newton from disclosing, directly or indirectly, “confidential information,” as defined in the agreement, to any person or entity, including media organizations or on Internet social media. “Confidential information,” as defined, included the facts, circumstances, allegations and contentions giving rise to Kirk‘s claims against the executives; the facts, circumstances, existence and substance of any encounter or communication between Kirk and any of the executives; and the settlement agreement, its negotiation and terms. The impermissible disclosure of confidential information was to be considered a material breach of the agreement.
The parties agreed to arbitrate “any and all future disputes or controversies of any kind or nature between the Parties, including without limitation any claim [or] disputes regarding validity, interpretation, enforcement or claimed breach of this Agreement, however characterized . . . before JAMS under the JAMS Comprehensive Arbitration Rules and Procedures . . . or ADR pursuant to its rules, and California law, to the greatest extent permitted by law.” Kirk and Newton acknowledged an unauthorized disclosure of confidential information would cause irreparable harm to the executives and agreed that, upon any breach or threatened breach of the confidentiality provision, the executives would be entitled to immediately obtain injunctive relief from the arbitrator (ex parte issuance of a temporary restraining order and a preliminary injunction) preventing the disclosure (or further disclosure) of confidential information pending the outcome of arbitration. Notwithstanding the arbitration provision, the parties further agreed, without waiving their right to arbitration, the executives could seek injunctive relief in court to prevent a breach of the settlement agreement.
Several months after executing the settlement agreement, the parties entered into a confidential amendment agreement in which the executives promised to invest additional sums in the motion picture being developed by Newton and Kirk and Newton reaffirmed the confidentiality and arbitration provisions of the settlement agreement.
2. The Demand for Arbitration and the Preliminary Injunction
Because of ongoing disputes among the parties that allegedly included threats by Kirk and others to disclose confidential information, on June 12, 2020 the executives initiated arbitration with JAMS, asserting claims of
Following a telephonic hearing, an emergency arbitrator, appointed pursuant to the JAMS rules identified in the settlement agreement, issued a temporary restraining order prohibiting Kirk, Newton, Cowan and Marshall from disclosing any confidential information as defined in the settlement agreement and from filing a lawsuit in any court against the executives, and ordered Kirk, Newton, Cowan and Marshall to show cause on July 6, 2020 why a preliminary injunction containing the same prohibitions should not issue. Kirk and the other respondents filed opposition papers.
The arbitrator issued a preliminary injunction on July 11, 2020 after a video hearing held several days earlier. The arbitrator‘s ruling enjoined Kirk, Newton, Cowan and Marshall and any person acting on their behalf from disclosing confidential information, including a disclosure in any document filed in court, and from filing a lawsuit in any court in violation of the arbitration provisions of the settlement agreement, the confidential amendment to the settlement agreement, the confidential nondisclosure agreement or a fourth agreement referred to as the Duchess Agreement. The emergency arbitrator declined to require the executives to post a bond.
3. The Petition To Vacate the Preliminary Injunction
Kirk and Marshall on September 4, 2020 filed a petition to vacate the emergency arbitrator‘s preliminary injunction, initiating a new action in Los Angeles Superior Court.3 The petition asserted as grounds to vacate the injunction that, prior to issuance of the temporary restraining order, the emergency arbitrator failed to make the full disclosures required by
could not be compelled to arbitrate any disputes with the executives.
The executives filed an opposition to the petition, arguing the preliminary injunction did not constitute an “award” within the meaning of
Following receipt of a reply memorandum from Kirk and Marshall and a hearing on October 15, 2020, the superior court ruled it lacked jurisdiction to consider the petition, relying primarily on the decision of our colleagues in Division Two of this court in Lonky v. Patel (2020) 51 Cal.App.5th 831 (Lonky). The court denied the petition, stating it was “ordered dismissed without prejudice to refiling once a final award is issued.”
Kirk and Marshall filed a timely notice of appeal.
DISCUSSION
1. Governing Law and Standard of Review
The parties’ settlement agreement specified arbitration proceedings were to be conducted under California law. Thus, the California Arbitration Act (CAA) (
Our jurisdiction to review superior court orders in arbitration matters is defined by
We independently review questions regarding our own jurisdiction. (California Redevelopment Assn. v. Matosantos (2011) 53 Cal.4th 231, 252.) In addition, we review questions of statutory construction de novo. (California Building Industry Assn. v. State Water Resources Control Bd. (2018) 4 Cal.5th 1032, 1041; In re Tobacco II Cases (2009) 46 Cal.4th 298, 311; see People v. The North River Ins. Co. (2021) 69 Cal.App.5th 1079, 1087 [when the pertinent facts are undisputed, we review de novo both questions of jurisdiction and issues of statutory interpretation].)
2. The Order Dismissing the Petition To Vacate the Preliminary Injunction Is Not Appealable
The existence of an appealable order or judgment is a jurisdictional prerequisite to an appeal. (Walker v. Los Angeles County Metropolitan Transportation Authority (2005) 35 Cal.4th 15, 21; Jennings v. Marralle (1994) 8 Cal.4th 121, 126; Aixtron, Inc. v. Veeco Instruments Inc. (2020) 52 Cal.App.5th 360, 384.) A superior court‘s order is generally appealable only when made so by statute. (Griset v. Fair Political Practices Com. (2001) 25 Cal.4th 688, 696 [“[a] reviewing court has jurisdiction over a direct appeal only when there is (1) an appealable order or (2) an appealable judgment“; “[a] trial court‘s order is appealable when it is made so by statute“].)
Neither Kirk and Marshall nor the executives question the appealability of the superior court‘s order dismissing the petition to vacate the preliminary injunction: All parties cite Maplebear, Inc. v. Busick (2021) 26 Cal.App.5th 394 (Maplebear), which distinguished this court‘s decision in Judge v. Nijjar Realty, Inc. (2014) 232 Cal.App.4th 619 (Judge) and held a superior court order dismissing a petition to vacate for lack of jurisdiction was an appealable order. (Maplebear, at p. 402.) Nonetheless, we must raise the issue on our own initiative whenever a doubt exists as to whether the superior court has entered an appealable judgment or order: “[W]e have an independent obligation in this as in every matter to confirm whether jurisdiction exists.” (California Redevelopment Assn. v. Matosantos, supra, 53 Cal.4th at p. 252; accord, Jennings v. Marralle, supra, 8 Cal.4th at p. 126; see Olson v. Cory (1983) 35 Cal.3d 390, 398 [“since the question of appealability goes to our jurisdiction, we are dutybound to consider it on our own motion“].)
In Judge, supra, 232 Cal.App.4th 619 this court held the superior court‘s order vacating an interim arbitration award (a “clause construction award” determining as a threshold matter that class and representative claims were subject to arbitration) was not appealable. (Id. at p. 622.) We explained, “Because the clause construction award does not qualify as an ‘award’ under
In light of Judge and Kaiser Foundation, our jurisdiction to consider the merits of Kirk and Marshall‘s appeal turns on two questions. First, is the arbitrator‘s ruling granting a preliminary injunction an award within the meaning of
section 1283.4
Kirk and Marshall concede the arbitrator‘s preliminary injunction ruling, a provisional order leaving unresolved all issues of liability and final relief for the parties, does not appear to be an award within the meaning of
Kirk and Marshall first point out, if the executives had obtained a preliminary injunction from the superior court, the order would have been immediately subject to review in this court. But as Kirk and Marshall recognize, appellate review of a preliminary injunction is expressly authorized by
(1997) 15 Cal.4th 68, 110 [“order granting the preliminary injunction was ‘immediately and separately appealable’ under . . .
Next, Kirk and Marshall argue, although the court in Lonky explained a ruling that is not an award within the meaning of
The dispute in Hightower concerned implementation of a buy-sell provision in an agreement between two 50 percent shareholders of a corporation. The arbitrator issued a partial final award that gave one shareholder the right to obtain financing to buy the shares of the other, reserving jurisdiction to determine issues that might arise if the option was exercised. (Hightower, supra, 86 Cal.App.4th at pp. 1426-1428.) The superior court denied the losing shareholder‘s petition to vacate the award. The court of appeal—in a
As explained in Lonky, supra, 51 Cal.App.5th at page 845, what Hightower teaches is that, “in the context of a series of rulings . . . a particular ruling is an ‘award’ only if that ruling (1) ‘determine[s] all issues that are necessary to the resolution’ of ‘“the controversy“’ being subject to arbitration, and (2) leaves unresolved only those ‘issues’ that are ‘potential,’ ‘conditional’ or that otherwise ‘could not have been determined’ at the time of the ruling.” Our analysis in Kaiser Foundation similarly emphasized the very limited nature of the Hightower decision: “The arbitrator in Hightower resolved all the issues necessary as of the date of the award to determine the parties’ controversy regarding the breach of the shareholder agreement and the appropriate remedy for the breach. The issues left open for resolution in a subsequent award simply could not have been decided as part of the partial final award because their nature and scope were uncertain as of the award date.” (Kaiser Foundation, supra, 13 Cal.App.5th at p. 1149.) Here, in contrast to Hightower, no part of the controversy between Kirk and Marshall, on the one hand, and the executives, on the other, was resolved by the preliminary injunction. The issues left open were neither potential nor conditional based on events yet to occur; they were known and capable of being resolved.
Kirk and Marshall attempt to erase this clear distinction between the preliminary injunction here and the award in Hightower by arguing that whether interim equitable relief should be granted was a discrete matter; all issues necessary for resolution of that question were determined; and the remaining disputed matters could not be decided with the preliminary injunction ruling because discovery and an evidentiary hearing were necessary for the arbitrator to rule on the merits of the parties’ controversy. We rejected a substantially similar argument in Kaiser Foundation, where the parties argued the issues of preemption and exhaustion, decided in the initial phase of the arbitration proceeding, were, in effect, raised and completely resolved in a separate action for declaratory relief before the arbitration panel. (Kaiser Foundation, supra, 13 Cal.App.5th at p. 1140.) Because the parties did not, in fact, initiate a separate arbitration proceeding for the preemption and exhaustion issues, however distinct from the underlying merits they may have been, the request that the arbitrators decide them first, we held, did not convert an interlocutory ruling into a final one subject to judicial review. (Id. at p. 1146 [“The text of
In a final argument for immediate judicial review of the preliminary injunction, after observing that no published California case has considered the precise question presented here—that is, judicial review of an arbitrator‘s award of interim equitable relief— Kirk and Marshall urge us to follow analogous federal law on the issue (while acknowledging we are not bound to do so), which treats such orders as sufficiently final for the district courts to confirm and enforce them. The federal policy, however, is based on the provisions of the Federal Arbitration Act (FAA) (
avoid potential delays at the trial and appellate levels“]; Kaiser Foundation, supra, 13 Cal.App.5th at p. 1150 [“it has long been recognized that parties typically choose arbitration precisely to avoid ‘the complications of traditional judicial review‘“].)
b. The superior court‘s order dismissing Kirk and Marshall‘s petition lacks the finality required for it to be appealable
Quoting
“There are good reasons for applying a finality requirement to orders listed in
interfere with the ‘“efficient, streamlined procedure[]“’ that is supposed to be arbitration‘s ‘fundamental attribute.‘” (Ibid.)
In Kaiser Foundation, supra, 13 Cal.App.5th at page 1139, we reiterated the holding of Judge that the finality requirement of earlier case law applied to all orders listed in We recognize the court in Maplebear, supra, 26 Cal.App.5th 394 reached a contrary conclusion, declining to follow the full reach of Judge and holding an order dismissing a petition to vacate a partial final award regarding class arbitration for lack of jurisdiction was appealable. (Maplebear, at pp. 401-402.)8 Noting the superior court in Judge had reached the merits of the arbitrator‘s interim ruling, the Maplebear court stated, “Our case is different. Here, we confront an appeal from a trial court order that dismissed a petition to vacate on the ground of no trial court jurisdiction. We conclude that the trial court order is appealable under In fact, the distinction identified in Maplebear makes little sense. By this reasoning, if the superior court fails to recognize the limits of its jurisdiction and grants a petition to vacate a nonfinal award that it ought not to have even considered—as was the case in Judge—the erroneous order is not appealable. But if the superior court properly understands that interim rulings by an arbitrator are not reviewable until the final award is entered and dismisses a premature petition to vacate, that entirely correct jurisdictional ruling is appealable. Nothing in the governing statutory language, let alone public policy encouraging arbitration as a speedy and relatively inexpensive method of dispute resolution with limited judicial intervention, supports that outcome. We adhere to the holding and rationale of Judge and dismiss the appeal. The appeal is dismissed. The parties are to bear their own costs in this proceeding. PERLUSS, P. J. We concur: SEGAL, J. FEUER, J.DISPOSITION