Njeri v. Tesla, Inc.

2025- 2025- Plaintiff Irene Njeri is ORDERED to arbitrate her claims against 01491391 01491391 defendant in defendant in accordance accordance with with the the terms of the terms of the arbitration arbitration provision provision in the parties’ in the parties’ Motor Vehicle Order Agreement (MVOA). (See Kim Decl. (MVOA). Decl. at Ex. Ex. 11 [MVOA]; [MVOA]; Sanders Decl. Decl. at Ex. Ex. 11 [same].) [same].)

Defendant has Defendant has met met its its burden burden to demonstrate the to demonstrate the existence existence of of controversy. (See Ramirez v. an agreement to arbitrate the controversy. v. Golden Queen Mining Co.,Co., LLC (2024) (2024) 102102 Cal.App.5th Cal.App.5th 821, 830-832 [three-step 830-832 [three-step burden burden shifting process]; process]; Iyere v. Wise Iyere v. Wise Auto Group (2023) Auto Group (2023) 87 87 Cal.App.5th Cal.App.5th 747, 747, 755 755 [same]; [same]; see see also also Kim Decl. Kim Decl. ¶¶ 9] 2-7, 2-7, Ex. Ex. 11 [MVOA].) [MVOA].) Plaintiff Plaintiff has has not not challenged challenged

produced any evidence disputing or produced disputing the the existence existence or authenticity of the the arbitration agreement therein. the MVOA or the therein. (See Ramirez v.v. Golden Queen Mining Co.,Co., LLC, LLC, at p. p. 837 [if [if opposing party fails to carry her second-step burden, opposing burden, the the burden shifting process stops there]; burden there]; Opp., Opp., in passim; passim; Decl., in passim; Sanders Decl., in passim; see also id. id. at Ex. 1 [MVOA].) Ex. 1 [MVOA].)

Plaintiff has Plaintiff has failed failed to to meet meet her her burden burden to to demonstrate demonstrate a a enforcement. (See Engalla v. defense to enforcement. v. Permanente Medical Group, Inc. Group, Inc. (1997) (1997) 1515 Cal.4th Cal.4th 951, 951, 972 [burden].) [burden].)

raised a Plaintiff has raised a single defense to enforcement based on unconscionability. unconscionability. (See Ramirez v.v. Charter Communications, Communications, Inc. 16 Cal.5 ‘ at 492-493 [unconscionability, Inc. 16 th [unconscionability, generally]; generally]; Baltazar v.v. Forever 21, 21, Inc. (2016) 62 Cal.4th 1237, Inc. (2016) 1237, 1243 1243 [same].) [same].)

There is a low degree of procedural procedural unconscionability unconscionability as the arbitration agreement appears in arbitration in a a standardized, standardized, preprinted preprinted form contract form contract offered offered byby the the party party with with superior superior bargaining bargaining power on power on aa take-it-or-leave-it basis. (See take-it-or-leave-it basis. (See Kim Kim Decl. Decl. ¶¶ 9 3-4 3-4 would not have been [plaintiff would been able to place the the order for the vehicle without agreeing agreeing to the MVOA], MVOA], Ex.

Ex. 1.) 1.) “ ‘‘[T]he [T]he adhesive nature nature of” of” an an arbitration arbitration agreement “is “is sufficient to establish establish some degree of procedural procedural unconscionability.’ unconscionability.’ [Citations.]” [Citations.]” (Swain v. v. LaserAway Medical Group, Group, Inc. (2020) Inc. (2020) Cal.App.5th 59, 67-68.) 57 Cal.App.5th 67-68.) This is so notwithstanding notwithstanding the the existence of an opt-out provision. existence (Id. at p. provision. (Id. p. 69 [“an [“an opt out provision does provision does not not insulate insulate an an arbitration arbitration agreement agreement from from aa finding finding of procedural procedural unconscionability”].) unconscionability”].)

As for defendant’s defendant's alleged alleged failure to provide provide a copy of the applicable arbitration applicable arbitration rules, rules, it it does does not not add add to to the the procedural procedural unconscionability of unconscionability of the agreement because the agreement because plaintiff plaintiff does does contend that anything contend anything was hidden hidden in the rules or that the rules unconscionable. (Nguyen are substantively unconscionable. (Nguyen v.v. Applied Medical Resources Corp. Resources Corp. (2016) (2016) 4 4 Cal.App.5th Cal.App.5th 232, 232, 249; 249; see see Baltazar, Baltazar, supra, 62 Cal.4th supra, 62 Cal.4th at at p. p. 1246.) 1246.)

failed, however, Plaintiff has failed, however, to demonstrate demonstrate any substantive substantive unconscionability. (See Baltazar, unconscionability. Baltazar, supra, supra, 62 Cal.4th Cal.4th at pp. pp. 1243-1244 [both 1243-1244 [both procedural procedural and and substantive substantive unconscionability unconscionability must be must be present present before before court court may may refuse refuse to to enforce enforce aa contract contract based onon the unconscionability]; Ramirez v. the doctrine of unconscionability]; v.

Communications, Inc., Charter Communications, supra, 16 Inc., supra, 16 Cal.5th Cal.5th at pp. pp. 492- 492- 493 [although 493 [although adhesion adhesion contracts contracts are are procedurally procedurally unconscionable, unconscionable, they nevertheless “remain“remain valid valid and and enforceable unless the enforceable resisting party can the resisting can also show that one or more of the contract’s contract’s terms is substantively

unconscionable or otherwise invalid”]; invalid”]; see also id. id. at pp. pp. 494- unconscionability, generally].) 495 [substantive unconscionability, generally].)

Specifically, plaintiff contends the MVOA is substantively Specifically, unconscionable because (1) (1) the the arbitration provision provision “allows “allows choice for a choice of arbitration arbitration forum –— but only for the party ‘‘electing’ electing’ to arbitrate,” arbitrate,” allowing allowing ““Tesla Tesla [to] [to] ‘elect’ ‘elect’ both to arbitrate inin the the first place, andand choose the forum,forum, and and choose the rules”; the rules”; (2) (2) ““the the arbitration-cost provisions are substantively unconscionable and and clearly violate ... ... the minimum minimum due process standards for consumer arbitrations,” arbitrations,” as they serve to “ “discourage[] discourage[] ... ... buyers from from seeking seeking to to enforce enforce their legal rights, rights, as buyers are potentially faced with faced with bearing exorbitant arbitration costs and bearing and expenses expenses they may have to reimburse to Tesla Tesla”;”; and and (3) the ““[a]rbitration (3) the [a]rbitration would would impose impose prohibitive costs on Plaintiff Plaintiff....” ...” (Opp. (Opp. at pp.pp. 6-7.) 6-7.) Plaintiff also Plaintiff also appears appears to suggest that to suggest that the arbitration clause the arbitration clause somehow gives the defendant the the sole discretion discretion to select the arbitrator. (See id. arbitrator. id. at p. p. 7.) 7.)

All of these arguments fail. fail. As an initial initial matter, matter, the arbitration arbitration provision in provision in the provide for a choice the MVOA does not provide choice of arbitral forum and does not grant Tesla the sole discretion forum discretion to select the arbitrator. the arbitrator. It requires arbitration arbitration of “any “any dispute arising out of out of or or relating relating to to any any aspect aspect of of the the relationship relationship between between [plaintiff] and Tesla [plaintiff] ... by a single arbitrator in an Tesla ... an arbitration arbitration administered by the American administered American Arbitration Association Association (AAA) under its Consumer Arbitration Arbitration Rules.”

Rules.” (Kim (Kim Decl. Decl. at Ex. Ex. 1, 1, p. p. 3.) This 3.) requirement applies This requirement applies equally equally to both parties. to both parties. The The mere mere fact that fact that the agreement requires the agreement requires arbitration arbitration with with AAA AAA does does not not somehow render the the provision “unfair” provision “unfair” or “ ‘ “so one-sided “ * “so one-sided as ‘shock to ‘ the conscience’ shock the conscience’ ” ’ such such that it is substantively unconscionable. (See unconscionable. (See Ramirez, Ramirez, supra, supra, 16 16 Cal.5th Cal.5th atat pp. pp. 494- 494- 495.)

Nothing 495.) Nothing suggests suggests thethe AAA AAA will will not not fairly fairly administer administer the the arbitration. (See id. arbitration. id. at p. p. 506 [“Normally, [“Normally, we assume the the arbitrator will act reasonably and and in conformity withwith the law.”].) law.”].)

To the extent plaintiff may be complaining complaining about the fact that Tesla drafted the Tesla drafted the agreement andand in in doing doing so was able to choose AAA as the choose provider—this presents an issue the arbitration provider—this of procedural of procedural unconscionability unconscionability (a(a contract contract presented presented on on a a take-it-or-leave-it basis without take-it-or-leave-it basis without aa meaningful meaningful choice choice or or opportunity to negotiate its terms) opportunity terms) and and not substantive substantive one-sided terms). unconscionability (unfair or one-sided terms).

As for the As for the cost cost provisions provisions that that purportedly purportedly leave leave buyers buyers like like plaintiff ““potentially potentially faced faced with with bearing bearing exorbitant arbitration costs and expenses,” expenses,” and and supposedly “ “impose impose prohibitive

costs on on Plaintiff” Plaintiff” (Opp. (Opp. at p.p. 7)—the 7)—the cost provision provision in the MVOA requires defendant to bear all all costs of arbitration. arbitration. It states: states: ““[Tesla] [Tesla] will will pay all all AAA fees for any arbitration, arbitration, which will will be held held in the city or county of [plaintiff’s] in the [plaintiff's] residence.” residence.” (Kim Decl. (Kim Decl. at Ex.Ex. 1, 1, p. p. 3; 3; Sanders Decl. Decl. at Ex. Ex. 1, 1, p. p. 3.) addressed Plaintiff has not acknowledged or addressed this language in opposition brief, and her opposition and has not shown shown or explained explained how she may have to unique to arbitration under to shoulder any costs unique the the terms of the MVOA. (See Opp., the MVOA.

Opp., inin passim.) passim.) Plaintiff has therefore failed failed to show that the the agreement’s agreement's cost provisions provisions unconscionable. (See Engalla, are substantively unconscionable. Engalla, supra, supra, 15 15 Cal.4th at p. Cal.4th p. 972 [burden]; [burden]; see also City City of of Monterey Monterey v. v. Carrnshimba (2013) Carrnshimba (2013) 215 Cal.App.4th Cal.App.4th 1068,1068, 1099 1099 [it [it is not the court’s court’s role to develop a a party’s party’s argument for him]; him]; Cahill v. v.

San Diego Gas & Electric Co. Co. (2011) (2011) 194194 Cal.App.4th Cal.App.4th 939, 956 [same]; People [same]; People v. Lee (2008) v. Lee (2008) 161161 Cal.App.4th Cal.App.4th 124,124, 130 130 [“It [“It is not the court’s court’s function function to marshal marshal evidence for the the parties parties or or to make tactical judgments about how the parties should present their arguments.”].) arguments.”].)

Defendant’s Defendant’s request for judicial judicial notice is GRANTED. GRANTED. (See Evid. Evid. Code, §§ 452, Code, 452, subd. subd. (d).) (d).) The case management The case management conference conference is is VACATED. VACATED.

The court ORDERS The court ORDERS this action stayed this action stayed pending pending completion completion of of arbitration or until further order of the court. arbitration court. (Code Civ. Civ. Proc., Proc., § 1281.4.) § 1281.4.)

The court sets The court sets a a status status conference conference regarding regarding the the arbitration arbitration for January for January 22, 22, 2027 2027 at at 9:00 9:00 a.m. a.m. in in Department Department C28. C28. Five Five days before the conference, the scheduled conference, the parties are ordered ordered to submit a joint statement describing describing the status of the arbitration. arbitration.

shall give notice of this ruling. Defendant shall ruling. 57.

57. Doe 9011 Doe 9011 v. v. Defendant Fullerton Fullerton School District’s District’s unopposed unopposed motion motion for Fullerton Fullerton GRANTED. leave to file a cross-complaint is GRANTED. School School compulsory, and The proposed cross-complaints is compulsory, and is governed governed District District by C.C.P. C.C.P. § § 426.50. 426.50. It provides provides that ““the the court, after notice to 2025- 2025- the adverse party, the adverse party, shall shall grant, grant, upon upon such such terms terms as as may may bebe 01473413 01473413 just just to to the parties, leave the parties, leave to to amend amend thethe pleading, pleading, or or to file the to file the cross-complaint, such cause if the cross-complaint, to assert such the party who failed failed to plead plead the cause acted in good good faith.” faith.”

This provision provision “shall “shall be liberally construed construed to avoid avoid forfeiture of causes of action.” action.”

Here, there Here, is no there is no evidence evidence of of bad bad faith. faith.