NextGear Capital, Inc. v. ICarz, Inc. ( 2020 )

1 KURT A. KAPPES – SBN 146384 LUPE R. LAGUNA – SBN 307156 2 JONATHAN K. OGATA – SBN 325914 GREENBERG TRAURIG, LLP 3 1201 K Street, Suite 1100 Sacramento, CA 95814-3938 4 Telephone: (916) 442-1111 Facsimile: (916) 448-1709 5 kappesk@gtlaw.com lagunal@gtlaw.com 6 ogataj@gtlaw.com 7 Attorneys for Plaintiff NEXTGEAR CAPITAL, INC. 8 9 UNITED STATES DISTRICT COURT 10 EASTERN DISTRICT OF CALIFORNIA 11 12 NEXTGEAR CAPITAL, INC., a Delaware ) CASE NO. 2:20-cv-00851-MCE-CKD Corporation, ) 13 ) ORDER GRANTING PLAINTIFF Plaintiff, ) NEXTGEAR CAPITAL, INC.’S MOTION TO 14 ) STRIKE ICARZ INC.’S JURY TRIAL v. ) DEMAND 15 ) iCarz Inc., d/b/a LENDING CLUB AUTO d/b/a ) Date: August 6, 2020 16 LATINOS AUTO CENTER, California ) Time: 2:00 p.m. Corporation, ) Courtroom: 7, 14th Floor 17 ) Defendant. ) 18 ) ) 19 ) 20 21 The Court, having considered Plaintiff’s Motion to Strike iCarz Inc.’s Jury Trial Demand (ECF No. 22 20), Defendant’s Opposition (ECF No. 29), and Plaintiff’s Reply (ECF No. 31), hereby GRANTS 23 Plaintiff’s Motion. 24 THE COURT HEREBY FINDS THAT: 25 Federal law controls the question of whether Defendant’s jury trial waiver is valid and enforceable. 26 Granite State Ins. Co. v. Smart Modular Techs., 76 F.3d 1023, 1026-27 (9th Cir. 1996) (“federal law 27 governs whether a party is entitled to a jury trial and if so, on what issues”). Under federal law, the factors wOASe 2 EUV OS LIVEN INES OPC VO Ee OY ee intelligent, and therefore enforceable, include: (1) whether there was a gross disparity in bargaining powe 2|| between the parties; (2) the business or professional experience of the party opposing the waiver; (3 3|| whether the opposing party had an opportunity to negotiate contract terms; and (4) whether the claus 4|| containing the waiver was inconspicuous. Century 21 Real Estate LLC y. All Prof'l Realty, Inc., No. 2:10 5 || 2751 WBS GGH, 2012 WL 2682761, at *2 (E.D. Cal. July 6, 2012). 6 Defendant knowingly, voluntarily, and intelligently waived its right to a jury trial when it execute 7|| the Note that is the genesis of this dispute. In signing the jury trial waiver Defendant acknowledged that 1 8 || had either consulted with counsel or had been given the opportunity to do so. Further, despite Defendan 9 || re-negotiating the terms of the Note multiple times, it never re-negotiated the scope or applicability of th 10 || jury trial waiver provision. Defendant does not dispute any of these points in its opposition; instead 11 || Defendant argues that state law should control whether the jury trial waiver is enforceable. But, as th Supreme Court has squarely held, whether a party is entitled to a jury trial in federal court is determinec 13 || by federal law, even where, as here, the Court is applying substantive state law in a diversity action. Se 14|| Simler v. Conner, 372 U.S. 221, 222 (1963) (holding “that the right to a jury trial in the federal courts is t 15 || be determined as a matter of federal law in diversity as well as other actions.”). 16 Accordingly, Defendant’s demand for a jury trial is stricken. 17 IT IS SO ORDERED. Dated: August 17, 2020 Eo 19 { late rf LEK. SENIOR UNITED STATES DISTRICT JUDGE 21 22 23 24 25 26 27 28