Joseph Mejia v. DACM, Inc.

Defendant DACM, Inc. (Del Amo), a motorcycle dealership, moved to

compel arbitration of a customer’s claims Del Amo violated various consumer protection

statutes when it sold the customer a motorcycle. The trial court denied Del Amo’s

petition to compel arbitration, finding the arbitration provision was unenforceable under

McGill v. Citibank, N.A. (2017) 2 Cal.5th 945 (McGill) because it barred the customer

from pursuing “in any forum” his claim for a public injunction to stop Del Amo’s

allegedly illegal practices.

Del Amo contends the trial court erred in ruling the arbitration provision is

unenforceable under McGill, supra, 2 Cal.5th 945. Del Amo makes essentially four

arguments. It contends McGill does not apply because, due to a choice-of-law provision

in the contract, Utah law rather than California law governs the dispute. Del Amo further

contends if California law applies, the arbitration provision “does not run afoul of

McGill” because Mejia does not seek a public injunction. Del Amo also argues the

arbitration clause is not unenforceable under McGill because the provision does not

prevent a plaintiff from seeking public injunctive relief in all fora. Finally, Del Amo

asserts if the arbitration provision is unenforceable under McGill, the Federal Arbitration

Act (FAA) preempts McGill and requires enforcement of the clause.

There is no merit to any of these contentions. Consequently, we affirm the

order.

I

BACKGROUND

A. The Underlying Transaction

In May 2017, plaintiff Joseph Mejia (Mejia) bought a used motorcycle from

Del Amo for $5,500. Mejia paid $500 cash and financed the remainder of the purchase

price with a WebBank-issued Yamaha credit card he obtained through the dealership

purchasing the motorcycle. In applying for the credit card, Mejia signed a credit

application acknowledging he had received and read WebBank’s Yamaha Credit Card

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Account Customer Agreement (the credit card agreement), which contained an arbitration

provision. The arbitration provision, set forth in section 36 of the credit card agreement,

stated either WebBank, Mejia, or “Yamaha (including its affiliates and dealers),” could,

acting alone, elect and thereby “require that the sole and exclusive forum and remedy for

resolution of a Claim be final and binding arbitration pursuant to this section . . .” The

provision defined “Claim,” in pertinent part, as follows: “As used in this Arbitration

Provision, ‘Claim’ shall include any . . . claim, dispute, or controversy . . . arising out of

your application for and origination of this Account, this Agreement, your Account or the

relationship between you and us, including (except to the extent provided otherwise in the

last sentence of section (f) below) the validity or enforceability of this Arbitration

Provision, any part thereof, or the entire Agreement. . . .” (§ 36(a).)

In subpart (f), the arbitration provision specifically barred arbitration of all

class, representative, or private attorney general claims: “NO ARBITRATION SHALL

PROCEED ON A CLASS, REPRESENTATIVE, OR COLLECTIVE BASIS

(INCLUDING AS PRIVATE ATTORNEY GENERAL ON BEHALF OF OTHERS),

EVEN IF THE CLAIM OR CLAIMS THAT ARE THE SUBJECT OF THE

ARBITRATION HAD PREVIOUSLY BEEN ASSERTED (OR COULD HAVE BEEN

ASSERTED) IN A COURT AS CLASS, REPRESENTATIVE, OR COLLECTIVE

ACTIONS IN A COURT. . . . Unless consented to in writing by all parties to the

arbitration, an award in arbitration shall determine the rights and obligations of the named

parties only, and only with respect to the claims in arbitration, and shall not (a) determine

the rights, obligations, or interests of anyone other than a named party, or resolve any

Claim of anyone other than a named party; nor (b) make an award for the benefit of, or

against, anyone other than a named party. . . . Any challenge to the validity of this

section (f) shall be determined exclusively by a court and not by the administrator or any

arbitrator.”

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Crucially for this appeal, the arbitration agreement also contained a “poison

pill” provision. Subpart (h) of section 36 states, in pertinent part, as follows: “If any

portion of this Arbitration Provision other than section (f) is deemed invalid or

unenforceable, the remaining portions of this Arbitration Provision shall nevertheless

remain valid and in force. If an arbitration is brought on a class, representative, or

collective basis, and the limitations on such proceedings in section (f) are finally

adjudicated pursuant to the last sentence of section (f) to be unenforceable, then no

arbitration shall be had.” (Italics added.)

The credit card agreement also contained a choice-of-law provision stating,

“This Agreement is governed by applicable federal law and by Utah law.”

B. The Petition to Compel Arbitration

Sometime after his purchase, Mejia filed a complaint against Del Amo on

behalf of himself and other similarly situated consumers alleging Del Amo “has violated

and continues to violate” the Rees-Levering Automobile Sales Finance Act (ReesLevering) by failing to provide its customers with a single document setting forth all the

financing terms for motor vehicle purchases made with a conditional sale contract.

According to Mejia, Rees-Levering’s “‘single document rule’ . . . requires motor vehicle

dealers in transactions involving the financing of motor vehicles to state in a single

document all the agreements concerning the total cost and terms of payment, including

the terms of financing as required by Civil Code section 2981.9.”

In essence, the complaint alleges Del Amo induces its customers to finance

their motorcycle purchase with a WebBank credit card, an “open-ended” credit

arrangement which, over time, substantially increases the customer’s cost. Moreover,

Mejia alleges, by facilitating the customer’s use of a credit card for the purchase, Del

Amo deceptively makes the transaction appear to be a “cash purchase,” which is exempt

from Rees-Levering. In actuality, Mejia asserts, the financing arrangement is a

conditional sale contract in which WebBank, the legal owner of the motorcycle, takes a

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security interest in the motorcycle which does not vest in the customer until after the

customer makes all payments due to WebBank. Consequently, Mejia contends, the

purchase transaction is governed by Rees-Levering.

The complaint alleges Del Amo’s failure to provide all the required

financing information in a single document violates not only Rees-Levering and Civil

Code section 2981 et seq., but also the Consumers Legal Remedies Act (CLRA, Civ.

Code, § 1750 et seq.) and the Unfair Competition Law (UCL, Bus. & Prof. Code,

§ 17200 et seq.). Among the relief requested, the complaint requests an injunction

prohibiting Del Amo from selling motor vehicles “without first providing the consumer

with a single document containing all of the agreements of Del Amo and the consumer

with respect to the total cost and the terms of payment for the motor vehicle, including

any promissory notes or other evidence of indebtedness in accordance with Civil Code

[section] 2981.9.” The complaint further requests an injunction preventing Del Amo

from selling motor vehicles “without first providing the consumer with all disclosures

mandated by Civil Code [section] 2982 in a single document.”

Based on the arbitration clause in the credit card agreement, Del Amo

moved to compel arbitration and to dismiss or stay the case pending completion of the

arbitration.

Mejia filed opposition to the motion to compel arbitration. Mejia argued

Del Amo, a nonsignatory to the credit card agreement, lacked standing to enforce the

arbitration provision in that agreement. Mejia also argued his claims against Del Amo

“are well beyond the scope of the Arbitration Agreement,” given the complaint does “not

even mention[]” the credit card agreement and “only disputes the adequacy of the

disclosures provided by Del Amo for a separate Sales Agreement.” Mejia also argued

the arbitration provision is unenforceable under McGill, supra, 2 Cal.5th 945, because it

purports to waive Mejia’s right to seek a public injunction “‘in any forum.’” (See

McGill, supra, 2 Cal.5th at p. 961 [arbitration provision purporting to waive right to seek

6

“in any forum” statutory remedy of public injunctive relief “is invalid and unenforceable

under California law”].)

C. The Order Denying the Petition to Compel Arbitration

The trial court denied the petition to compel arbitration. Though the court

concluded the arbitration provision “appears to encompass [Mejia’s] claims in this action,

and Del Amo appears to be an intended third-party beneficiary of that provision,” the

court nonetheless ruled the arbitration provision is unenforceable under McGill, supra,

2 Cal.5th 945. The court explained its reasoning as follows:

“Plaintiff’s Complaint seeks, among other remedies, a public injunction.

The arbitration provision, as Plaintiff correctly argues, prevents Plaintiff from seeking

and obtaining a public injunction in arbitration. And because, if Del Amo elects to

compel arbitration, arbitration is the only forum available to Plaintiff, Plaintiff is

effectively precluded from seeking a public injunction in any forum.

“As held in McGill[, supra,] 2 Cal.5th 945, 961, Plaintiff’s right to seek a

public injunction is not waivable, and thus, at the least, this Court would have to sever the

prohibition on public injunctive relief from the Arbitration Provision before it could

enforce that provision. But, by the terms of the Credit Card Agreement, the parties have

restricted the right of the Court to so sever.

“Specifically, Section 36(f) of the Credit Card Agreement contains the

prohibition on public injunctive relief and provides that ‘[a]ny challenge to the validity of

this section (f) shall be determined exclusively by a court and not by the administrator or

any arbitrator.’ Section 36(h) in turn provides that ‘[i]f an arbitration is brought on a

class, representative, or collective basis, and the limitations on such proceedings in

section (f) are finally adjudicated pursuant to the last sentence of section (f) to be

unenforceable, then no arbitration shall be had.’

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“Thus, since the Court hereby determines that the limitation on public

injunctive relief is unenforceable, ‘then no arbitration shall be had.’ [¶] Del Amo’s

motion to compel arbitration is accordingly denied.”

II

DISCUSSION

Del Amo argues the trial court erred in concluding the arbitration provision

is unenforceable under McGill, supra, 2 Cal.5th 945, a case we discuss in more detail

below. Del Amo asserts McGill does not apply to this case because the credit card

agreement specifies Utah law rather than California law governs the agreement.

Alternatively, Del Amo asserts the arbitration provision is not unenforceable under

McGill because Mejia does not seek a public injunction and, in any event, the arbitration

provision does not bar public injunctive relief in all fora. Finally, Del Amo contends if

McGill renders the arbitration provision unenforceable, the Federal Arbitration Act

(FAA) preempts McGill and requires enforcement of the provision.

Because all the issues raised in this appeal involve only questions of law,

we review the trial court’s order de novo. (Laswell v. AG Seal Beach, LLC (2010)

189 Cal.App.4th 1399, 1406; Aanderud v. Superior Court (2017) 13 Cal.App.5th 880,

890.) For the reasons explained below, we find none of Del Amo’s contentions has

merit.

A. The McGill Decision Applies Notwithstanding the Choice-of-Law Provision

1. A Short Primer on McGill

In McGill, supra, 2 Cal.5th 945, a credit card accountholder filed a class

action against the issuing bank alleging claims under the CLRA, UCL, and the false

advertising law (Bus. & Prof. Code, § 17500 et seq.) for deceptive practices in offering a

“‘credit protector’” insurance plan. The complaint sought money damages, restitution,

and an injunction prohibiting the bank “from continuing to engage in its allegedly illegal

and deceptive practices.” (Id. at p. 953.) The Supreme Court noted such “public

8

injunctive relief, i.e., injunctive relief that has the primary purpose and effect of

prohibiting unlawful acts that threaten future injury to the general public,” is among “the

statutory remedies available for a violation of” the CLRA, the UCL, and the false

advertising law. (Id. at p. 951.)

The bank in McGill petitioned to compel the account holder to arbitrate her

claims on an individual basis based on an arbitration clause in the customer account

agreement. The arbitration clause required arbitration of “‘All Claims . . . ,’” and stated,

“‘Claims and remedies sought as part of a class action, private attorney general or other

representative action are subject to arbitration on an individual (non-class, nonrepresentative) basis, and the arbitrator may award relief only on an individual (non-class,

non-representative) basis.’. . . ‘The arbitrator will not award relief for or against anyone

who is not a party. If you or we require arbitration of a Claim, neither you, we, nor any

other person may pursue the Claim in arbitration as a class action, private attorney

general action or other representative action, nor may such Claim be pursued on your or

our behalf in any litigation in court.’” (McGill, supra, 2 Cal.5th at p. 952, italics added.)

The Supreme Court identified the issue in McGill as “whether the

arbitration provision is valid and enforceable insofar as it purports to waive McGill’s

right to seek public injunctive relief in any forum.” (McGill, supra, 2 Cal.5th at p. 956.)

The high court concluded the arbitration clause had such a sweeping preclusive effect

across all fora because the clause barred McGill from pursuing “‘Claims and remedies’”

on a class or representative basis in both arbitration and “‘in any litigation in court.’”

(Id. at p. 952.) Having identified the issue, the Court ruled the arbitration provision was

“invalid and unenforceable under California law” precisely because “it purports to waive

McGill’s statutory right to seek [public injunctive] relief.” (Id. at p. 961.)

In explaining that conclusion, the Supreme Court cited Civil Code section

3513, which provides, in pertinent part, that “‘a law established for a public reason

cannot be contravened by a private agreement.’” (McGill, supra, 2 Cal.5th at p. 961.) In

9

other words, a statutory right created to serve a public purpose is unwaivable. The Court

stated, “By definition, the public injunctive relief available under the UCL, the CLRA,

and the false advertising law . . . is primarily ‘for the benefit of the general public.’

[Citations.]” (Ibid.) Accordingly, the Supreme Court concluded, “the waiver in a

predispute arbitration agreement of the right to seek public injunctive relief under these

statutes would seriously compromise the public purposes the statutes were intended to

serve. Thus, insofar as the arbitration provision here purports to waive McGill’s right to

request in any forum such public injunctive relief, it is invalid and unenforceable under

California law.” (Ibid.)

2. The Choice-of-Law Analysis

Del Amo argues the trial court erred in ruling the arbitration provision is

unenforceable under McGill, supra, 2 Cal.5th 945 because Utah law, not California law,

applies in this case. The contention lacks merit. We conclude the trial court properly

refused to enforce the choice-of-law provision in the credit card agreement.

In Nedlloyd Lines B.V. v. Superior Court (1992) 3 Cal.4th 459 (Nedlloyd),

our high court set forth the rules for deciding the enforceability of contractual choice-oflaw provisions. Nedlloyd involved a contract dispute between a shipping company which

was incorporated in Hong Kong with its principal place of business in California, and

three other shipping companies which were incorporated and had their principal places of

business in the Netherlands. The contract contained a choice-of-law clause providing the

contract was to be governed by Hong Kong law. The Supreme Court held the choice of

law clause was fully enforceable and applicable to the claims asserted in that litigation

based on an analysis of the factors listed in the Restatement Second of Conflict of Laws

(Restatement) section 187, subdivision (b).

As the Supreme Court explained in Nedlloyd, in determining whether to

enforce a contractual choice-of-law provisions, “California courts shall apply the

principles set forth in Restatement section 187, which reflects a strong policy favoring

10

enforcement of such provisions.” (Nedlloyd, supra, 3 Cal.4th at pp. 464-465.) Under the

Restatement section 187 principles, “‘The law of the state chosen by the parties to govern

their contractual rights and duties will be applied . . . unless either [¶] (a) the chosen state

has no substantial relationship to the parties or the transaction and there is no other

reasonable basis for the parties’ choice, or [¶] (b) application of the law of the chosen

state would be contrary to a fundamental policy of a state which has a materially greater

interest than the chosen state in the determination of the particular issue and which, under

the rule of § 188, would be the state of the applicable law in the absence of an effective

choice of law by the parties.’” (Id. at p. 465, fns. omitted; Washington Mutual Bank v.

Superior Court (2001) 24 Cal.4th 906, 917 [if party seeking to enforce choice-of-law

meets burden of proving substantial relationship, “the parties’ choice generally will be

enforced unless the other side can establish both that the chosen law is contrary to a

fundamental policy of California and that California has a materially greater interest in

the determination of the particular issue”] (italics added).)

Del Amo prevails on the first step of the Restatement section 187 analysis

because it produced evidence the chosen state, Utah, has a substantial relationship to the

parties or the transaction. In Nedlloyd, supra, 3 Cal.4th at p. 467, the Supreme Court held

a party’s domicile or incorporation in the chosen state “provides the required ‘substantial

relationship.’ [Citation.]” (Ibid.) Del Amo satisfied the “substantial relationship”

requirement by submitting evidence WebBank’s headquarters and bank charter are in

Utah.

Del Amo fares less well in the next two steps of the Restatement section

187 analysis, however: Mejia persuasively argues Utah law is contrary to a fundamental

policy of California, and California has a “‘materially greater interest than the chosen

state in the determination of the particular issue’” involved in this appeal: the

enforceability of arbitration contracts which purport to waive the right to seek public

injunctive relief.

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Del Amo argues Utah law is not contrary to any fundamental policy of

California because both states “broadly favor[] enforcement of arbitration clauses as

written. [Citations.]” Moreover, Del Amo contends, “Mejia cannot show that application

of Utah law would deny him the right to pursue adequate relief.” Del Amo argues Utah’s

consumer protection statute, the Consumer Sales Practices Act (UCSPA) “broadly

prohibits unfair and deceptive acts in consumer transactions. . . . [and] also provides

aggrieved consumers various remedies, including damages, restitution, and equitable

relief. . . . So applying Utah law and dismissing plaintiffs’ UCL and CLRA claims would

not violate any fundamental public policy of California[.]”

Mejia argues Utah’s consumer protection statute lacks many of the

substantive protections California law provides, pointing, for example, to ReesLevering’s requirement of full disclosure in one document of all cost items associated

with financing a motor vehicle purchase, with no comparable provision in Utah law. We

need not delve into the significance of the distinctions Mejia draws between the two

states’ consumer protection statutes, however, because there is a simpler basis for finding

Utah law conflicts with a fundamental policy of California. As Del Amo concedes in its

reply, “Utah does not permit courts to invalidate arbitration clauses that waive public

injunctive relief in any forum.”

The California Supreme Court’s McGill decision articulates the state’s

fundamental policy against enforcing the contractual waiver of the right to seek in any

forum a public injunction, which “[b]y definition . . . is primarily ‘for the benefit of the

general public.’ [Citations.]” (McGill, supra, 2 Cal.5th at p. 961.) Utah law does not

afford the same protection to the right to seek a public injunction. Consequently,

applying Utah law would conflict with California’s fundamental interest in protecting

Mejia’s right to seek public injunctive relief from Del Amo’s allegedly illegal practices.

Faced with this obstacle to enforcing the choice of law provision, Del Amo

responds with three arguments, each unsuccessful. The first two arguments dispute the

12

application of McGill to this case. Del Amo argues “the relief Mejia seeks does not

qualify as a public injunction” and “the [arbitration] agreement does not waive the right

to seek public injunctive relief in all forums.” We consider and reject both these

arguments in the next section of this opinion. Del Amo’s third argument is circular and

conclusory, deserving no discussion. Del Amo states: “Finally, Mejia’s argument fails

as Utah law provides him adequate relief, and he fails to show that denying him the

additional remedy of a public injunction would violate any fundamental public policy in

this case.” We conclude Mejia carried his burden under Nedlloyd, supra, 3 Cal.4th at

p. 465, to show Utah law is contrary to a fundamental policy of California.

Mejia likewise prevails in his argument California has a materially greater

interest than Utah in the determination of the particular issue involved in this case.

(Nedlloyd, supra, 3 Cal.4th at p. 465.) Del Amo characterizes California’s interest here

as “an interest in regulating transactions concerning its consumers,” and asserts “Utah has

an equally compelling interest in regulating banks chartered within its borders.” Del

Amo asserts, “[S]ince WebBank conducts business throughout the United States, Utah

has a compelling interest in ensuring uniform regulation and interpretation of its banks’

credit card agreements. . . . Utah’s interests would be severely impacted if banks located

and chartered there were exposed to the peril of litigation under 50 different states’

regulatory schemes.” Del Amo further asserts, “Mejia seeks a ruling effectively

invalidating the WebBank-Yamaha credit card program in California, thus significantly

impairing WebBank’s interests even though it is not a party to the case. The impact of

such a rule of law on WebBank’s business operations and Utah’s interests would be

substantial.”

Del Amo’s argument badly misses the mark. Mejia’s complaint does not

seek to regulate WebBank, interpret its credit card agreement, or invalidate its “credit

card program in California[.]” In fact, this case has nothing to do with WebBank’s

practices or with its credit card program. Instead, the complaint has everything to do

13

with Del Amo’s practices, and Del Amo is a California corporation, domiciled and doing

business in California.

As Mejia states in his brief, “[T]he claims in the case all relate to Del

Amo’s failure to disclose to Mejia . . . the costs associated with the financing of the

motorcycle in a single document, as required by the Rees-Levering Act.” In other words,

the complaint only seeks to evaluate, penalize, and correct Del Amo’s alleged illegal

practices; WebBank’s practices are simply not in issue in the case. It follows that the

complaint does not implicate Utah’s interest in “regulating banks chartered within its

borders.”

We conclude Mejia also carried his burden of showing California has a

materially greater interest than Utah in the determination of the “particular issue”

involved: the enforceability of an arbitration provision which bars Mejia from seeking in

any forum public injunctive relief against Del Amo. Accordingly, the trial court properly

applied the California Supreme Court’s decision in McGill, supra, 2 Cal.5th 945 in

denying the petition to compel arbitration.

B. The Arbitration Provision is Unenforceable under McGill

Del Amo asserts several arguments for finding McGill does not invalidate

the arbitration clause in this case. None has merit.

1. Mejia Seeks a Public Injunction under McGill

Del Amo argues the arbitration clause is not unenforceable under McGill

because Mejia “did not seek a public injunction.” Del Amo asserts that “[al]though

Mejia labeled his action as one for a ‘public’ injunction, the injunctive relief he sought

was actually private. McGill therefore does not apply.” Del Amo asserts, “Mejia does

not seek to prevent future harm to the general public,” but rather seeks an injunction to

benefit only a “narrow group of Del Amo customers”––the class of similarly situated

individuals who, like Mejia, would buy a motorcycle from Del Amo with a conditional

14

sale contract. The general public, Del Amo argues, would not benefit from such a

“private” injunction.1 The argument makes little sense.

Mejia’s brief demonstrates the illogic of Del Amo’s argument. Mejia

points out his prayer seeks an injunction forcing Del Amo to cease “selling motor

vehicles in the state of California without first providing the consumer with all

disclosures mandated by Civil Code [section] 2982 in a single document.” Mejia asserts,

“[T]he prayer is plainly one for a public injunction given that Mejia ‘seeks to enjoin

future violations of California's consumer protection statutes, relief oriented to and for the

benefit of the general public.’ (Blair [v. Rent-A-Center, Inc. (9th Cir. 2019) 928 F.3d

[819,] 831.) [¶] . . . Mejia’s prayer does not limit itself to relief only for class members or

some other small group of individuals; it encompasses ‘consumers’ generally. (See Cruz

v. PacifiCare Health Sys., Inc. (2003) 30 Cal.4th 303, 315 [(Cruz)] [‘the request for

injunctive relief is clearly for the benefit of health care consumers and the general public

by seeking to enjoin PacifiCare’s alleged deceptive advertising practices’ (emphasis

added)].)”

1 Del Amo argues the facts of this case are analogous to those in Clifford v. Quest

Software (2019) 38 Cal.App.5th 745 (Clifford), where we held the plaintiff in that case

could not avoid arbitration of a UCL claim under “the Broughton/Cruz rule” because he

sought private injunctive relief for the benefit of only himself and a group of similarly

situated persons. Del Amo contends Mejia, like the plaintiff in Clifford, seeks only a

private injunction.

Clifford is not analogous. As Mejia points out, Clifford “was a wage and hour

case that did not involve either the Rees-Levering Act or the CLRA. Moreover, the

private nature of the UCL claim that was alleged was ‘immediately evident’ from the face

of the complaint given that the complaint ‘repeatedly refers to wage and hour violations

directed at Clifford only.’ (38 Cal.App.4th at 753.) The prayer was similarly limited,

with ‘[t]he only express beneficiary of Clifford’s requested injunctive relief . . . [being]

Clifford;’ ‘the only potential beneficiaries are Quest’s current employees.’”

Unlike the patently “private” injunctive relief the plaintiff sought in Clifford, we

explain here the injunctive relief Mejia seeks is clearly for the benefit of the general

public.

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The Supreme Court in McGill distinguished private and public injunctions.

The opinion defined “private injunctive relief” as “relief that primarily ‘resolve[s] a

private dispute’ between the parties [citation] and ‘rectif[ies] individual wrongs’

[citation], and that benefits the public, if at all, only incidentally[.]” (McGill, supra,

2 Cal.5th at p. 955.) The opinion defined “public injunctive relief” as “relief that ‘by and

large’ benefits the general public [citation] and that benefits the plaintiff, ‘if at all,’ only

‘incidental[ly]’ and/or as ‘a member of the general public’ [citation].” (Ibid.) The high

court cited as an example of a public injunction “an injunction under the CLRA against a

defendant’s deceptive methods, acts, and practices [which] ‘generally benefit[s]’ the

public ‘directly by the elimination of deceptive practices’ and ‘will . . . not benefit’ the

plaintiff ‘directly,’ because the plaintiff has ‘already been injured, allegedly, by such

practices and [is] aware of them.’ [Citation.] ‘[E]ven if a CLRA plaintiff stands to

benefit from an injunction against a deceptive business practice, it appears likely that the

benefit would be incidental to the general public benefit of enjoining such a practice.’

[Citation.]” (Ibid.)

We conclude the injunctive relief Mejia prays for in the complaint fits the

Supreme Court’s definition of “public injunctive relief” in McGill: “injunctive relief that

has the primary purpose and effect of prohibiting unlawful acts that threaten future injury

to the general public.” (McGill, supra, 2 Cal.5th at p. 951.) Consequently, there is no

merit to Del Amo’s argument McGill is inapplicable because Mejia does not seek public

injunctive relief.

2. The Arbitration Provision Bars a Public Injunction in Every Forum

Del Amo similarly fails to persuade us McGill is inapplicable because the

arbitration clause, “properly interpreted,” does not preclude a public injunction “in every

forum.” Del Amo’s argument depends on a strained, unreasonable interpretation of the

arbitration clause. We concur with the trial court’s interpretation of the arbitration clause

16

as barring Mejia from seeking public injunctive relief “in any forum,” thereby rendering

the arbitration clause unenforceable under McGill.

The trial court’s reasoning in the minute order can be summarized as

follows: The arbitration provision “prevents [Mejia] from seeking and obtaining a public

injunction in arbitration.”2 Del Amo’s election to compel arbitration made arbitration

“the only forum available to [Mejia].”3 Given that, under McGill, the statutory right to

seek a public injunction is unwaivable and an arbitration agreement which purports to

waive that statutory right is unenforceable (McGill, supra, 2 Cal.5th at p. 961), the court

might have “saved” the arbitration clause by “sever[ing] the prohibition on public

injunctive relief from the Arbitration Provision.” The court could not save the arbitration

clause, however, because of the “poison pill” contained in the clause “restrict[ing] the

right of the Court to sever.” That restriction is in section 36, subpart (h), which provides

that “[i]f an arbitration is brought on a class, representative, or collective basis, and the

limitations on such proceedings in section (f) are finally adjudicated pursuant to the last

sentence of section (f) to be unenforceable, then no arbitration shall be had.” Having

concluded the arbitration provision’s “limitation on public injunctive relief is

unenforceable” under McGill, the court further concluded “‘then no arbitration shall be

had.’”

Del Amo explicitly attacks as “erroneous” the first two premises of the trial

court’s reasoning. Del Amo argues “settled principles of contract interpretation” support

a different construction of the arbitration clause.

2 Section 36, subpart (f) barred arbitration on “a class, representative, or collective

basis (including as private attorney general on behalf of others)” and also explicitly

barred the arbitrator from determining “the rights, obligations, or interests of anyone

other than a named party” or from “mak[ing] an award for the benefit of . . . anyone other

than a named party.”

3 Section 36, subpart (a) gave Del Amo as a Yamaha “dealer” the right to elect

arbitration as “the sole and exclusive forum and remedy for resolution of a Claim . . . .”

17

In a nutshell, Del Amo contends the arbitration provision requiring

arbitration (upon Del Amo’s election to arbitrate) of any “Claim” has an implied

exception for a claim for a public injunction; the arbitration provision allows Mejia to

pursue his claim for public injunction in court after arbitration of all arbitrable claims.

Consequently, the arbitration provision does not purport to waive the right to seek a

public injunction in every forum and is, therefore, not unenforceable under McGill.

Close inspection of Del Amo’s argument reveals its errors.

There is no merit to Del Amo’s contention the arbitration provision has an

“implied exception” for seeking a public injunction. An implied exception must be

consistent with the intent of the parties as expressed in the contract, and must be

reasonable in light of the whole contract. “A contract must receive such an interpretation

as will make it lawful . . . and capable of being carried into effect, if it can be done

without violating the intention of the parties.” (Civ. Code, § 1643.) “We do not have the

power to create for the parties a contract that they did not make and cannot insert

language that one party now wishes were there.” (Vons Companies, Inc. v. United States

Fire Ins. Co. (2000) 78 Cal.App.4th 52, 59.) Here, the purported implied exception for a

public injunction directly conflicts with the plain text of the arbitration provision and the

clear intent expressed in that text.

As the trial court specifically noted, the “poison pill” provision in subpart

(h) expressly states that if a court finds “unenforceable” the “limitations” in subpart (f) on

the arbitration of “class, representative, or collective” actions and on “class,

representative, or collective” relief (such as a public injunction), “then no arbitration shall

be had.” In other words, the arbitration provision makes clear the parties do not intend

to arbitrate “other claims” if the “limitations” on the arbitration of “class, representative

[and] collective” claims are unenforceable. The clear import of the poison pill, then, is

the parties intend to forfeit arbitration entirely if class, representative, or collective claims

18

(and relief) are exempted from the reach of the arbitration provision and allowed to be

tried in court.

Given the text and intent of the poison pill in subpart (h), Del Amo’s

argument for an implied exception for public injunctive relief makes no sense.

Notwithstanding Del Amo’s invocation of general rules of construction favoring

construing “arbitration provisions to support their enforceability[] (Pearson Dental

[Supplies, Inc. v. Superior Court (2010)] 48 Cal.4th [665,] 681-682),” we reject the

unreasonable interpretation of the arbitration provision Del Amo urges here.

Del Amo’s final argument is the FAA preempts McGill. We need not

discuss this contention, however, because Del Amo itself concedes the argument has no

chance of success. Del Amo states in a footnote to its opening brief: “The California

Supreme Court and the Ninth Circuit have held that the FAA does not preempt the

McGill rule. (McGill, supra, 2 Cal.5th at p. 952; Blair v. Rent-A-Center, Inc., supra,

928 F.3d at p. 824.) Del Amo acknowledges that this Court is bound by McGill, but

raises the preemption point to preserve it for appellate review by the California or United

States Supreme Courts.”)

In conclusion, the trial court properly found the arbitration provision

unenforceable under McGill, supra, 2 Cal.5th at p. 961, and on that basis properly denied

Del Amo’s petition to compel arbitration.4

4 In light of this conclusion, we need not address Mejia’s two arguments, rejected

by the trial court, that Del Amo as a nonsignatory to the credit card agreement lacks

standing to enforce that agreement’s arbitration clause, and that the claims in his

complaint are outside the scope of the agreement to arbitrate.

The order denying the petition to compel arbitration is affirmed. Mejia is

entitled to his costs on appeal.