Grace Collins v. Richard Rionda Del Castro

CourtDistrict Court, C.D. California
DecidedJanuary 7, 2022
Docket2:21-cv-06197
StatusUnknown

This text of Grace Collins v. Richard Rionda Del Castro (Grace Collins v. Richard Rionda Del Castro) is published on Counsel Stack Legal Research, covering District Court, C.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Grace Collins v. Richard Rionda Del Castro, (C.D. Cal. 2022).

Opinion

Case 2:21-cv-06197-ODW-GJS Document 23 Filed 01/07/22 Page 1 of 12 Page ID #:419

O 1

2 3 4 5 6 7

8 United States District Court 9 Central District of California

11 GRACE COLLINS, Case № 2:21-CV-06197-ODW (GJSx)

12 Petitioner, ORDER GRANTING PETITION TO 13 v. CONFIRM ARBITRATION AWARD 14 RICHARD RIONDA DEL CASTRO, [1] AND DENYING PETITION TO 15 ET AL., VACATE ARBITRATION AWARD

Respondents. [18] 16

17 18 I. INTRODUCTION 19 Before the Court are Petitioner Grace Collins’s (“Collins”) Petition to Confirm 20 Arbitration Award (Pet. Confirm, ECF No. 1) and Respondents Richard Rionda del 21 Castro (“Rionda”), Hannibal Production, Inc. (“HPI”), and Speed Kills Production, 22 Inc.’s (“SKP”) (collectively, “Respondents”) Motion to Vacate Arbitration Award 23 (Mot. Vacate, ECF No. 18). For the reasons discussed below, the Court GRANTS the 24 Petition to Confirm the Arbitration Award and DENIES the Motion to Vacate.1 25 26 27

28 1 Having carefully considered the papers filed in connection with the Petitions, the Court deems the matter appropriate for decision without oral argument. Fed. R. Civ. P. 78; C.D. Cal. L.R. 7-15. Case 2:21-cv-06197-ODW-GJS Document 23 Filed 01/07/22 Page 2 of 12 Page ID #:420

1 II. BACKGROUND 2 The present action is the latest in a long-running legal dispute between Collins, 3 on the one hand, and Rionda and his companies HPI and SKP, on the other. The legal 4 dispute arises from a loan agreement (the “Agreement”) between Collins and HPI. 5 (See Pet. Confirm ¶¶ 13–14.) The Agreement provided that Collins would lend 6 $245,000 to HPI to produce the film Speed Kills. (Pet. Confirm Ex. B (“Loan 7 Agreement” or “Agreement”) ¶ 1, ECF No. 1-1.) Both Collins and HPI executed the 8 Agreement. (Id. at 35.2) Rionda executed the Agreement in his capacity as president 9 of HPI, not as an individual. (See id.) The Agreement included an arbitration clause, 10 which required that “[a]ny dispute, controversy or claim arising out of or relating to 11 the enforcement, interpretation or alleged breach of this agreement, including without 12 limitation tort claims and arbitrability issues, shall be submitted to and resolved by 13 binding arbitration in Los Angeles, California.” (Id. ¶ 20.) 14 The loan matured on April 5, 2018, and remains unpaid. (Pet. Confirm Ex. A 15 (“Final Award” or “Award”) at 21, ECF No. 1-1.) On October 11, 2018, Collins sued 16 Respondents in Maryland for defaulting on the loan and sought repayment and 17 damages. (Pet. Confirm ¶ 24.) Respondents removed the action to federal court and 18 successfully transferred it to the Central District of California. (See Mot. Vacate 19 Exs. 2, 4, ECF No. 18-1.) Respondents then moved to compel Collins to arbitrate the 20 loan dispute, and Collins acquiesced. (See id. Ex. 5 (“Pet. Compel”) at 70, ECF 21 No. 18-1; Pet. Confirm ¶ 26.) 22 Once Collins initiated arbitration with the American Arbitration Association 23 (“AAA”), Rionda and SKP moved to dismiss Collins’s arbitration action as against 24 them on the grounds that Rionda and SKP had not consented to arbitration. (See Mot. 25 Vacate Ex. 9 (“Arb. Mot. Dismiss”) at 92, ECF No. 18-1.) The Arbitrator found that 26 Rionda and SKP were equitably estopped from denying the arbitrability of Collins’s 27

28 2 The Court refers to the pagination in the ECF docket header for all Exhibit citations, including the Final Award and the Agreement.

2 Case 2:21-cv-06197-ODW-GJS Document 23 Filed 01/07/22 Page 3 of 12 Page ID #:421

1 claims. (Pet. Confirm ¶ 29; Mot. Vacate Ex. 9 (“Arb. Order No. 2”) at 100, ECF No. 2 18-1.) Accordingly, the Arbitrator concluded that he had jurisdiction over Collins’s 3 claims against each of the Respondents, including Rionda and SKP, for breach of the 4 Loan Agreement. (Arb. Order No. 2 at 100.) 5 Several months later, Collins filed a First Amended Complaint with the AAA, 6 asserting an alter ego claim against Respondents. (Mot. Vacate Ex. 10a, Ex. 1 (“Arb. 7 First Am. Compl.”) ¶¶ 6–12, ECF No. 18-2.) Respondents objected to Collins’s alter 8 ego allegation, arguing that it exceeded the scope of the arbitration clause and would 9 exceed the Arbitrator’s authority. (Mot. Vacate Ex. 10b at 105–06, ECF No. 18-2.) 10 The Arbitrator concluded that the arbitration clause was sufficiently broad to 11 encompass Collins’s alter ego claims. (Mot. Vacate Ex. 11 (“Arb. Order No. 10”) 12 at 127–28, ECF No. 18-2.) Further, because the parties had agreed to arbitrate 13 arbitrability under the Agreement, the Arbitrator reasoned it was within his authority 14 to determine the arbitrability of Collins’s alter ego claim against Rionda. (Id.) The 15 Arbitrator concluded that Rionda must arbitrate Collins’s alter ego claim on the 16 grounds of equitable estoppel. (Id. at 128.) Thus, the Arbitrator held he had 17 jurisdiction over Collins’s claims against Respondents. (See id.) 18 The parties presented their case at hearing over the course of four days in 19 February 2021. (Award 5.) On May 7, 2021, the Arbitrator issued a twenty-six page 20 Final Award. (See id. at 27.) The Arbitrator held that Collins prevailed on her breach 21 of contract claim and was entitled to reasonable attorneys’ fees and costs. (Id. at 21.) 22 Further, the Arbitrator held that Rionda was co-liable under a single enterprise alter 23 ego theory for the obligations of HPI and SKP under the Loan Agreement. (Id. at 25.) 24 Accordingly, the Arbitrator held that Respondents were jointly and severally liable. 25 (Id.) The Arbitrator awarded Collins the following: 26  The principal amount of the loan, $245,000; 27  A one-time interest payment of $31,850; 28

3 Case 2:21-cv-06197-ODW-GJS Document 23 Filed 01/07/22 Page 4 of 12 Page ID #:422

1  Prejudgment interest, from April 5, 2018, at the rate of 2 13% per annum; 3  Administrative costs and fees; and 4  Reasonable attorneys’ fees of $125,000. 5 (Id. at 26.)3 6 On July 20, 2021, Collins filed the present Petition to Confirm the Arbitration 7 Award in this Court. In response, Respondents filed a Counter-Motion requesting that 8 the Court vacate, or in the alternative, modify, correct, or amend, the Arbitration 9 Award. Collins opposed Respondents’ Motion to Vacate, and Respondents replied. 10 (Opp’n Mot. Vacate (“Opp’n”), ECF No. 20; Reply ISO Mot. Vacate, ECF No. 21.) 11 III. LEGAL STANDARD 12 Under the Federal Arbitration Act (“FAA”)4, if a party seeks to have an 13 arbitration award confirmed by a federal court, “the court must grant such an order 14 unless the award is vacated, modified, or corrected as prescribed in sections 10 and 11 15 of this title.” 9 U.S.C. § 9. However, judicial review of arbitration awards is 16 “extremely limited” and “highly deferential.” Kyocera Corp. v. Prudential-Bache 17 Trade Servs., Inc., 341 F.3d 987, 998 (9th Cir. 2003) (en banc); Sheet Metal Workers’ 18 Int’l Ass’n Loc. Union No. 359 v. Madison Indus., Inc. of Ariz., 84 F.3d 1186, 1190 19 (9th Cir. 1996). Therefore, a court will set aside an arbitrator’s decision “only in very 20 unusual circumstances.” First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 942 21 (1995).

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Grace Collins v. Richard Rionda Del Castro, Counsel Stack Legal Research, https://law.counselstack.com/opinion/grace-collins-v-richard-rionda-del-castro-cacd-2022.