Afzal vs. Genesis Motor America, LLC

Plaintiffs Timothy David Lomakin and Alissa Claire Lomakin shall give notice.

2. Afzal vs. Genesis Motor 1. Motion to Compel Arbitration America, LLC 2. Case Management Conference

25-01519236 Defendant Genesis Motor America, LLC’s motion to compel arbitration is DENIED.

Defendant seeks an order compelling plaintiff Uzma Afzal to arbitrate his claims pursuant to (1) an arbitration agreement contained in the Genesis “2023 Owner’s Handbook and Warranty Information” booklet (owner’s handbook), and (2) an arbitration provision contained in a Hyundai Bluelink/Genesis Connected Services Agreement (CSA).

Owner’s handbook, mutual assent. To the extent defendant relies on the arbitration agreement in the owner’s handbook, defendant has failed to meet its burden to demonstrate the existence of this agreement. (See Victrola 89, LLC v. Jaman Properties 8 LLC (2020) 46 Cal.App.5th 337, 345-346 [FAA applies pursuant to the terms of arbitration agreement]; Johnson v. Walmart Inc. (9th Cir. 2023) 57 F.4th 677, 680-681 (Johnson) [burden]; see also Villa Decl at Ex. 2 [handbook excerpts].)

Defendant has failed to demonstrate plaintiff’s mutual assent to the arbitration agreement in the owner’s handbook. (See Berman v. Freedom Financial Network, LLC (9th Cir. 2022) 30 F.4th 849, 855 [under FAA, state law governs contract formation]; Civ. Code, § 1550 [contract elements]; see also Johnson, supra, 57 F.4th at pp. 680-681 [arbitration is strictly a matter of consent; “ ‘a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.’ ”]; accord, Coinbase, Inc. v. Suski (2024) 602 U.S. 143, 148.)

To form a contract under California law, there must be mutual assent. (Herzog v. Superior Court (2024) 101 Cal.App.5th 1280, 1293-1294 (Herzog); Long v. Provide Commerce, Inc. (2016) 245 Cal.App.4th 855, 862 (Long).) “ ‘ “[M]utual manifestation of assent, whether by written or spoken word or by conduct, is the touchstone of contract.” ’ [Citation.]” (Long, at p. 862.) “ ‘Mutual assent is determined under an objective standard applied to the outward manifestations or expressions of the parties, i.e., the reasonable meaning of their words and acts, and not their unexpressed intentions or understandings. The

parties’ outward manifestations must show that the parties all agreed ‘upon the same thing in the same sense.’ If there is no evidence establishing a manifestation of assent to the ‘same thing’ by both parties, then there is no mutual consent to contract and no contract formation.” (Herzog, at pp. 1293-1294.)

Assent, however, requires notice. (B.D. v. Blizzard Entertainment, Inc. (2022) 76 Cal.App.5th 931, 944 (Blizzard); Stover v. Experian Holdings, Inc. (9th Cir. 2020) 978 F.3d 1082, 1086 [“notice—actual, inquiry, or constructive—is the touchstone for assent to a contract”]; see Herzog, supra, 101 Cal.App.5th at pp. 1293-1294; Weeks v. Interactive Life Forms, LLC (2024) 100 Cal.App.5th 1077, 1089.) “[I]n the absence of actual notice, a manifestation of assent may be inferred from the consumer’s actions ... but any such action must indicate the parties’ assent to the same thing, which occurs only when the [provider] puts the consumer on constructive notice of the contractual terms.” (Sellers v.

JustAnswer LLC (2021) 73 Cal.App.5th 444, 461 (Sellers); accord, Herzog, at p. 1294.) “[W]hether the terms appear on a physical piece of paper or a computer screen, ‘California law is clear—“an offeree, regardless of apparent manifestation of his consent, is not bound by inconspicuous contractual provisions of which he was unaware, contained in a document whose contractual nature is not obvious.” ’ [Citation.]” (Sellers, supra, at p. 461; accord, Herzog, supra, 101 Cal.App.5th at pp. 1293-1294; Long, supra, 245 Cal.App.4th at p. 862.)

Nothing shows defendant put plaintiff on notice of the arbitration agreement within the approximately 46-page “Owner’s Handbook and Warranty Information” booklet prior to plaintiff’s purchase of the vehicle, and nothing from its cover suggests it contains an independent arbitration agreement to which plaintiff’s assent will be deemed merely by driving the vehicle off the lot. (See Villa Decl. at Ex. 2.) The fact that the arbitration agreement appears in the “owner’s handbook” indicates plaintiff would have had no reason to discover it until sometime after he had already become the “owner” of the vehicle and unwittingly assented to the agreement by driving it; and nothing suggests plaintiff would have had reason to reference the “warranty information” booklet within the first 30 days of ownership, such that he should have discovered the arbitration agreement in time to opt out.

Owner’s handbook, equitable estoppel. Defendant contends plaintiff is nevertheless equitably estopped from denying the existence of the arbitration agreement because he relies on the warranty in the handbook as a basis for his claims.

This is a common argument. However, the argument is unpersuasive. Equitable estoppel requires the existence of a “contract.” (See, e.g., Soltero v. Precise Distribution, Inc. (2024) 102 Cal.App.5th 887, 893 [sine qua non of equitable estoppel is plaintiff’s actual dependence on the underlying contract].) Here, defendant conflates a “warranty” with a “contract,” both of which are legal terms of art, and not necessarily the same.

A “contract” is an agreement that requires mutual assent and consideration. (Civ. Code, § 1550 [mutual assent and consideration are “essential to the existence of a contract”]; Aton Center, Inc. v. United Healthcare Ins. Co. (2023) 93 Cal.App.5th 1214, 1231 [“ ‘the vital elements of a cause of action based on contract are mutual assent (usually accomplished through the medium of an offer and acceptance) and consideration’ ”].)

An express warranty is an assurance of a product’s utility and performance that accompanies its purchase and, unlike a “contract,” does not require mutual assent. (See Civ. Code, § 1791.2, subd. (a) [“ ‘Express warranty’ means: (1) A written statement arising out of a sale to the consumer of a consumer good pursuant to which the manufacturer, distributor, or retailer undertakes to preserve or maintain the utility or performance of the consumer good or provide compensation if there is a failure in utility or performance; or (2) In the event of any sample or model, that the whole of the goods conforms to such sample or model.”]; Ford Motor Warranty Cases (2025) 17 Cal.5th 1122, 1134 [“Express warranties may arise from sources outside a ... contract, including statements in a manufacturer’s brochure...”]; Gavaldon v.

DaimlerChrysler Corp. (2004) 32 Cal.4th 1246, 1258-1259 [holding service contracts and express warranties are mutually exclusive, explaining “an express warranty” is “part of the purchase of a consumer product, and a representation of the fitness of that product,” whereas the purchase of a service contract is distinct from the purchase of the product itself].)

Defendant has failed to show that the warranty in the handbook constitutes a “contract” in the traditional sense, as opposed to a mere “warranty” or assurance of the vehicle’s utility and performance that accompanied its purchase. The mere fact that defendant provided an express warranty guaranteeing the performance of the vehicle does not necessarily mean the parties executed a “contract” by which they “mutually” agreed to certain obligations—particularly those independent from and unrelated to the fitness of the product and of which plaintiff had no notice—that plaintiff is now attempting to disclaim, which is the situation that equitable estoppel is meant to address. (See Ford Motor Warranty Cases, supra, 317 Cal.5th at p.

1136 [with equitable estoppel, “the essential concern is whether plaintiffs are trying to enforce contractual terms beneficial to them while avoiding their own contractual agreement to arbitrate”].) Having failed to show to the warranty constitutes a “contract” in the traditional sense to which plaintiff has mutually agreed in the first place, defendant has failed to show he should be equitably estopped from avoiding the arbitration agreement therein. (See Goldman v. KPMG, LLP (2009) 173 Cal.App.4th 209, 220 [“ ‘[t]he linchpin for equitable estoppel is equity—fairness’ ”].)

Furthermore, even if defendant had established that the warranty was a “contract,” which it has not, equitable estoppel does not apply because plaintiff’s claims do not rely on the substantive terms of the subject warranty; they rely on obligations outside the warranty imposed by statute. (See Ballesteros v. Ford Motor Co. (2025) 109 Cal.App.5th 1196, 1207-1208.) “It is not enough that the complaint ... includes claims that ‘ “presum[e] the existence of” ’ such an agreement. [Citation.] Instead, the causes of action ... must be ‘ “intimately founded in and intertwined” with the underlying contract obligations.’ [Citation.] Indeed, there must be ‘actual reliance on the terms of the agreement’ [citation], and the causes of action must premise liability on ‘duties imposed by the agreement” itself [citation].” (Ibid.)

Plaintiff has alleged three causes of action in this case for (1) breach of implied warranty in violation of the Song-Beverly Act, (2) breach of express warranty in violation of the Song-Beverly Act, (2) and (3) violation of Song-Beverly Act at Civil Code section 1792.3. All three allege various violations of the Song-Beverly Act, which imposes certain statutory obligations on manufacturers who make express warranties. Manufacturers may ... make express warranties, which trigger various statutory provisions covering notice and repair or replacement of nonconforming goods. (See Civ. Code, § 1793 et seq.)” (Ford Motor Warranty Cases, supra, 17 Cal.5th at pp. 1133- 1134.) These obligations are not terms of the warranties themselves but “are imposed by statute.” (Ibid.)

Plaintiff’s second and third causes of action are based on defendant’s violations of these statutory obligations—i.e., the failure to promptly provide restitution—rather than a term of the warranty itself. (Civ. Code, § 1793.2, subds. (a)(3), (b), (d); see Compl. ¶¶ 6-7, 15-16, 25- 41.) As for the first cause of action, it arises from a breach of the implied warranty of merchantability, which “arises by operation of law.” (Ford Motor Warranty Cases, at p. 1134; see Compl. ¶¶ 18-23.) Thus, none of these claims “premise liability on ‘duties imposed by the agreement’ itself....” (Ballesteros v. Ford Motor Co., supra, 109 Cal.App.5th at pp. 1207-1208.) Therefore, even if the warranty

was a “contract” in the traditional sense (which again, defendant has not shown), equitable estoppel does not apply because plaintiff’s claims do not rely on the substantive terms of the warranty itself.

The CSA. To the extent the motion is based on the arbitration provision in the CSA, defendant has failed to demonstrate it covers plaintiff’s claims in this case. While the arbitration provision purports to cover any and all disputes between the parties regarding “the [v]ehicle”—the scope of an arbitration clause turns on whether the claims are “rooted” in the contractual relationship between the parties. (Ahern v. Asset Management Consultants, Inc. (2022) 74 Cal.App.5th 675, 692-693.) “[E]ven under a very broad arbitration provision, such as ‘any controversy or claim arising out of or relating to this agreement,’ ” the subject claims must “ ‘ “have their roots in the relationship between the parties which was created by the contract” ’ before they can be deemed to fall within the scope of the arbitration provision.” (Rice v. Downs (2016) 248 Cal.App.4th 175, 188.)

Here, the CSA governs the provision of “Connected Services,” the wireless/technology/roadside assistance services received as part of plaintiff’s enrollment in a Bluelink Connected Services subscription. (Rao Decl. at Ex. E.) The complaint in this case alleges the vehicle contained defects and nonconformities to warranty. (See, e.g., Compl. ¶¶ 2, 8-16, 19-20, 25-27, 33-41.) The “Connected Services” are not at issue in this case and plaintiff’s claims do not arise out of the relationship created by the CSA.

Request for judicial notice. Defendant’s request for judicial notice is GRANTED as to the complaint (RJN ¶ 1; see Evid. Code, § 452, subd. (d)) and otherwise DENIED. Judicial notice of the owner’s handbook is unnecessary as defendant has authenticated it on reply. (See Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 748, fn. 6 [denying request where judicial notice is not necessary]; Building Industry Assn. of the Bay Area v. City of San Ramon (2016) 4 Cal.App.5th 62, 73, fn. 11 [same]; see also Montalvan Decl. ¶¶ 2-7, Ex. A.)

The Case Management Conference is CONTINUED to August 27, 2026, at 9:30 a.m. in Department C12.

Defendant shall give notice.