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The Estate of Arce v. Panish Shea & Boyle LLP

United States District Court, S.D. California

November 20, 2019

THE ESTATE OF ALEIDA ARCE, by and through its Successor in Interest, MARIA HERNANDEZ HUERTA, et al., Plaintiffs,
v.
PANISH SHEA & BOYLE LLP, Defendant.

          ORDER: (1) GRANTING DEFENDANT'S MOTION TO COMPEL ARBITRATION (DOC. NO. 6); AND (2) DENYING DEFENDANT'S MOTION TO DISMISS AS MOOT (DOC. NO. 5)

          Hon. Anthony J. Battaglia, United States District Judge.

         Presently before the Court is Defendant Panish Shea & Boyle LLP's (“Defendant”) motion to compel arbitration, (Doc. No. 6) and motion to dismiss for failure to state a claim, or in the alternative, motion to strike punitive damages from Plaintiffs' complaint, (Doc. No. 5). The motions were fully briefed on May 22, 2019. Having reviewed the parties' arguments and controlling legal authority, and pursuant to Civil Local Rule 7.1.d.1, the Court finds the matter suitable for decision on the papers and without oral argument. For the reasons set forth below, the Court GRANTS Defendant's motion to compel arbitration and DENIES AS MOOT Defendant's motion to dismiss. Furthermore, the Court STAYS these proceedings pending the outcome of any arbitration.

         I. BACKGROUND

         This case involves claims for legal malpractice against Defendant Panish Shea & Boyle LLP, a personal injury law firm located in Los Angeles, California. (Doc. No. 1-2, Complaint “Compl.” ¶ 1.)

         On February 3, 2013, Plaintiff Victoria Arce and her mother, Aleida Arce (“Decedent”) were traveling on a tour bus on California State Route 38 near Yucaipa, California. (Id. at ¶ 2.) The tour bus was owned and operated by Interbus Tours and Charter and Scapadas Magicas, LLC. (Id.) On the last leg of the trip, the bus driver lost control of the bus, careened into other vehicles, crossed the center divider, collided with an oncoming truck, before rolling over and coming to a rest in the middle of the roadway. (Id.) During the accident, passengers were ejected from the bus. (Id.) Decedent suffered fatal blunt force injuries. Plaintiff Victoria Arce suffered blunt force trauma to her head and sustained severe injuries. (Id.)

         Defendant pursued and settled a case in state court on Plaintiffs' behalf. (Id. at ¶ 3.) Plaintiffs' case in state court included causes of action for wrongful death, a survival action, and a personal injury claim by Plaintiff Victoria Arce. (Id.) After settlement of the state court case, Plaintiffs filed another separate lawsuit, alleging that Defendant failed to file, pursue, or settle a case in federal court on Plaintiffs' behalf. (Id. at ¶ 4.) Specifically, Plaintiffs assert two causes of action for professional negligence and for breach of fiduciary duty. Plaintiffs contend that a federal case should have been filed because the bus was regulated, overseen, inspected, and certified by the United States Department of Transportation, Federal Motor Carrier Safety Administration (“FMCSA”). (Id.) Plaintiffs claim FMCSA failed to properly inspect the bus, and issued a satisfactory rating to the bus in violation of its duties and procedures. (Id.) Instead of pursuing a claim in federal court, Plaintiffs allege Defendant allowed the statute of limitations on the federal claim to run, even though the attorneys considered the claim, and knew that at least one other lawyer representing another passenger in the accident was pursuing such a federal claim. (Id. at ¶ 5.)

         Plaintiffs filed their legal malpractice action in San Diego Superior Court on January 15, 2019. (Compl.) Defendants removed to this Court on March 15, 2019. (Doc. No. 1.) On April 3, 2019, Defendant filed: (1) a motion to dismiss for failure to state a claim, or in the alternative, motion to strike punitive damages from Plaintiffs' complaint (Doc. No. 5), and (2) a motion to compel arbitration (Doc. No. 6.) The motions were fully briefed on May 22, 2019. This order follows.

         II. REQUEST FOR JUDICIAL NOTICE

         Federal Rule of Evidence 201 states that a “court may judicially notice a fact that is not subject to reasonable dispute because it: (1) is generally known within the trial court's territorial jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed.R.Evid. 201(b). Courts routinely take judicial notice of documents filed on public court dockets under Rule 201(b). See Porter v. Ollison, 620 F.3d 952, 954-55 n.1 (9th Cir. 2010) (“Judicial notice is taken of court dockets in the state court proceedings.”); Qualcomm, Inc. v. Motorola, Inc., 185 F.R.D. 285, 286 nn.2-3 (S.D. Cal. 1999). A court has authority to take judicial notice that certain proceedings occurred, but a court may not take “judicial notice of disputed facts stated in public records.” Perdue v. Rodney Corp., No. 13CV2712-GPC BGS, 2014 WL 3726700, at *4 (S.D. Cal. July 25, 2014).

         Defendant requests the Court take judicial notice of documents filed in the previous state court litigation. (Doc. No. 14-1.) Defendant requests judicial notice of two documents-an Amended Petition for Compromise of Plaintiff Victoria Arce, and an Amended Order Approving Compromise of Minor, both filed in the state court matter, Morales et al. v Scapadas Magicas et al., San Bernardino Superior Court, Case No. CIVDS1301868. Because these documents are part of the state court docket, the Court GRANTS Defendant's request to take judicial notice of both documents. See Porter, 620 F.3d at 954-55 n.1.

         III. LEGAL STANDARD

         A. Motion to Compel Arbitration

         The Federal Arbitration Act (“FAA”) governs the enforcement of arbitration agreements involving interstate commerce. See 9 U.S.C. § 2. Pursuant to § 2 of the FAA, an arbitration agreement is “valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” Id. The FAA permits “[a] party aggrieved by the alleged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration [to] petition any United States district court . . . for an order directing that such arbitration proceed in the manner provided for in [the] agreement.” Id. § 4.

         Given the liberal federal policy favoring arbitration, the FAA “mandates that district courts shall direct parties to proceed to arbitration on issues as to which an arbitration agreement has been signed.” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218 (1985). Thus, in a motion to compel arbitration, the district court's role is limited to determining “(1) whether a valid agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue.” Kilgore v. KeyBank Nat'l Ass'n, 673 F.3d 947, 955-56 (9th Cir. 2012) (citing Chiron Corp. v. Ortho ...


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