Court Opinion

ID: 9390558
Source: CourtListenerOpinion
Date Created: 2023-04-27 19:03:08.241746+00
Date Added: 2024-06-11T17:18:35.456219
License: Public Domain

Filed 4/27/23 New England Wire Technologies v. Cooner Sales CA2/4

   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion
has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                         SECOND APPELLATE DISTRICT
                                       DIVISION FOUR

 NEW ENGLAND WIRE                                                 B320514
 TECHNOLOGIES
 CORPORATION                                                      (Los Angeles County
 et al.,                                                          Super. Ct. No.21STCV43375)

           Plaintiffs and Appellants,

           v.

 COONER SALES COMPANY,
 LLC et al.,

      Defendants and
 Respondents.

     APPEAL from a judgment of the Superior Court of
Los Angeles County, Stephen I. Goorvitch, Judge. Affirmed.
      Grignon Law Firm, Margaret M. Grignon, Anne M.
Grignon; Hill, Farrer & Burrill, William A. White, G. Cresswell
Templeton for Plaintiffs and Appellants.
      Weinstein Law Firm and David R. Weinstein; Quintairos,
Prieto, Wood & Boyer, David G. Halm; Larson, Steve E. Bledsoe,
Jerry A. Behnke, Andrew J. Bedigian for Defendant and
Respondent Cooner Sales Company;
      Schnader Harrison Segal & Lewis, Bruce B. Kelson,
Stephen H. Dye for Defendant and Respondent American
Arbitration Association.

                        INTRODUCTION
       Appellants New England Wire Technologies Corporation
and New England Electric Wire Corporation (collectively New
England) have been engaged in arbitration proceedings with
respondents Cooner Sales Co., LLC and Cooner Enterprises, Inc.
(collectively Cooner entities) since 2009. Respondent American
Arbitration Association, Inc. (AAA) is the administrator of the
long-running arbitration, which has included approximately 100
evidentiary hearings before a three-arbitrator panel and resulted
in four interim awards.
       In 2021, New England sought to disqualify all three
arbitrators based on their failure to disclose that an attorney who
represented Cooner Sales from 2015 to 2019 was also an active
AAA arbitrator. New England also sought supplemental
disclosures regarding the business relationship between that
attorney and AAA. After the arbitrators and AAA refused New
England’s demands, New England filed a complaint in superior
court asserting causes of action for provisional remedies under

                                 2
Code of Civil Procedure section 1281.8,1 unfair competition under
Business and Professions Code section 17200 et seq. (UCL),
equitable severance of any provision in the arbitration agreement
requiring use of AAA, and declaratory and injunctive relief
including cessation of the current arbitration proceedings and
starting anew with a new arbitral administrator. Respondents
separately filed demurrers to the complaint.
       New England subsequently moved to disqualify the law
firm representing Cooner Sales. New England alleged that an
attorney disqualified from the arbitration in 2014 recently joined
the firm, and his affiliation precluded the firm’s further
participation in the superior court and arbitration proceedings.
Cooner Sales opposed the motion.
       The superior court sustained all three demurrers without
leave to amend. On the causes of action asserted under section
1281.8, the court ruled that New England sought remedies
beyond the scope of section 1281.8 and failed to show that
provisional remedies were necessary in any event. It further
concluded the arbitrators were not required to make the
requested disclosures, and, even if they were, New England failed
to timely seek disqualification. In light of these rulings, the court
further concluded that there were no bases upon which to grant
equitable severance or declaratory or injunctive relief. The court
also rejected the UCL claim, which sounded against AAA only, as
derivative of the other causes of action. The court denied New
England’s motion to disqualify Cooner Sales’s counsel as moot.
       On appeal, New England contends the court erred by
sustaining the demurrers without leave to amend and by

1    All further statutory references are to the Code of Civil
Procedure unless otherwise indicated.

                                 3
declining to address its motion to disqualify counsel. We affirm.
New England has not demonstrated an entitlement to relief
under section 1281.8, it failed to challenge the ruling on the
equitable severance cause of action, and its other claims are
derivative or subject to arbitral immunity. New England has not
cited any authority requiring the superior court to resolve
motions to disqualify prior to resolving other dispositive motions,
and we decline to infringe on the court’s wide discretion to control
proceedings before it. The request for judicial notice is denied.
                         BACKGROUND2
I.    The Parties
      New England designs, manufactures, and sells custom wire
and cable. New England and a predecessor of the Cooner entities
formed a partnership to distribute New England’s products in
seven western states. In 1996, that partnership became Cooner
Sales, a member-managed LLC Cooner Sales is governed by an
operating agreement between its two members, New England
Wire Technologies Corporation and Cooner Enterprises. New
England Electric Wire Corporation holds a 35 percent
membership interest in Cooner Sales, and Cooner Enterprises
holds the remaining 65 percent. Cooner Sales is and always has
been managed by the three principals of Cooner Enterprises.
AAA is a provider of arbitration services.

2     We draw the substantive factual allegations concerning the
parties and the arbitration from New England’s complaint. We
must accept these allegations as true for purposes of this appeal.
(See Mathews v. Becerra (2019) 8 Cal.5th 756, 761-762.) We draw
the limited and largely undisputed facts concerning Richmond’s
disqualification from New England’s motion to disqualify Larson
LLP.

                                 4
II.   The Fifth Arbitration
      The Cooner Sales operating agreement contains an
arbitration provision stating that “[a]ny controversy or claim
arising out of, or relating to this Agreement, or to the
interpretation, breach or enforcement thereof, shall be settled by
arbitration in Los Angeles, California in accordance with the
rules then obtaining of the American Arbitration Association.”
New England and Cooner Sales have arbitrated several disputes
pursuant to this provision since 1998. Cooner Sales initiated the
arbitration at issue, “the Fifth Arbitration,” in 2009, by asserting
claims against New England. New England counter-claimed
against both Cooner Sales and Cooner Enterprises. AAA is the
administrator of the still-ongoing Fifth Arbitration, over which
AAA arbitrators Peter D. Collisson, Paul E. Burns, and Hon.
James M. Slater (Ret.) (collectively “the panel” or “the
arbitrators”) are presiding.
      The lengthy Fifth Arbitration has been divided into
multiple phases, and the parties have participated in
approximately 100 evidentiary hearing days, most recently on
May 31, 2019. The panel has issued four interim awards, most
recently on March 31, 2021. The interim awards have been a
mixed bag for the parties: on the one hand, the panel has
determined that Cooner Sales is entitled to “millions of dollars” in
unpaid commissions and profit disgorgements from New
England; on the other, it has agreed with New England that the
parties’ distribution agreement ended in 2016, Cooner Sales
improperly paid Cooner Enterprises’s legal expenses, and Cooner
Sales should be dissolved unless Cooner Enterprises buys out
New England Electric Wire Corporation’s interest in the LLC.

                                 5
III.   Arbitration Counsel
       A.     Arbitrators Disqualify Cooner Entities’ Counsel
       In 2014, the fifth year of the Fifth Arbitration, attorney
Rick Richmond and his then-law firm, Jenner & Block, associated
into the arbitration as counsel of record for both Cooner entities.
New England filed an action in superior court seeking to
disqualify Richmond and Jenner & Block due to an alleged
conflict of interest between Cooner Sales and Cooner Enterprises
arising from New England’s counterclaims against Cooner Sales.
The superior court referred the matter to the arbitrators, who
ultimately granted the motion.
       B.     Cooner Sales Retains O’Brien and Larson LLP
       Shortly thereafter, in January 2015, attorney Robert C.
O’Brien and his then-law firm Arent Fox LLP associated into the
arbitration as counsel for Cooner Sales only. They filed an
updated notice of appearance in April 2015. O’Brien
subsequently left Arent Fox LLP to join a new firm, Larson
O’Brien LLP, as a named partner. O’Brien and Larson O’Brien
LLP continued to represent Cooner Sales. In September 2019,
O’Brien left Larson O’Brien LLP to serve as National Security
Advisor to former president Donald Trump. O’Brien withdrew as
Cooner Sales’s counsel at that time, although the newly renamed
Larson LLP continued to represent Cooner Sales in the Fifth
Arbitration.
IV. O’Brien’s Alleged Conflicts
       A.     Disclosures Relating to O’Brien
       When O’Brien initially associated into the matter in early
2015, arbitrators Collisson and Burns represented that they did
not have any additional disclosures relating to O’Brien or Arent
Fox LLP. Arbitrator Slater disclosed that he previously served as

                                6
an arbitrator on three cases in which Arent Fox LLP represented
parties. Slater stated that those previous matters would not
affect his neutrality in this case.
       In response to a request from Collisson that the parties
advise the panel if they were aware of any relationships requiring
disclosure, O’Brien sent AAA’s Manager of ADR Services a letter
on February 4, 2015. O’Brien’s letter stated, “pursuant to AAA
Commercial Arbitration Rules and Mediation Procedures, Rule R-
17, Arent Fox is unaware of any circumstance likely to give rise
to justifiable doubt as to the impartiality or independence of the
arbitrators in this matter . . . including any bias or financial or
personal interest in the result of the arbitration or any past or
present relationship with the parties or their representatives.”
Neither the panel nor O’Brien made any further disclosures.
       B.    O’Brien’s Alleged Conflicts of Interest
       New England alleges that, at the time O’Brien sent his
disclosure letter, “(a) he was an active roster member of the AAA,
which is the DRPO [dispute resolution provider organization] in
the Fifth Arbitration; (b) he intended to accept arbitration
matters as a AAA arbitrator while he simultaneously represented
[Cooner Sales] before the AAA panel members, who were all
active co-members of the AAA’s arbitration roster with O’Brien;
and (c) he also intended to market and promote the AAA’s
services and/or be one of its speakers while he was also counsel
for [Cooner Sales] in the Fifth Arbitration.” New England alleges
that neither O’Brien, the panel, nor AAA informed it of these
facts.
       C.    New England Discovers the Alleged Conflicts
       New England alleges: “In August 2021, New England’s
counsel discovered that O’Brien had returned to his law firm

                                7
(now Larson LLP) as ‘Partner Emeritus.’ While attempting to
determine O’Brien’s status, New England’s counsel inadvertently
learned for the first time that, while representing [Cooner Sales]
in the Fifth Arbitration from 2015 to Fall 2019, O’Brien had
simultaneously been serving as an AAA arbitrator in multiple
other matters. Subsequently, New England’s counsel also
inadvertently learned that, during the same time, O’Brien also
served as an active AAA roster member and/or, upon information
and belief, an active AAA marketer, promoter, and/or speaker.
While O’Brien had offhandedly indicated in an early colloquy
with the Panel that he had previously stood in their shoes as a
AAA arbitrator or been a speaker at the AAA’s request, neither
he, nor the Fifth Arbitration Panel members, nor the AAA, ever
disclosed to New England that O’Brien was, in fact, an active
AAA roster member, intended to accept AAA cases as an
arbitrator, and market or promote the AAA, all the [sic] while he
was simultaneously representing [Cooner Sales] before the three
AAA roster members who presided over the Fifth Arbitration. As
a result, New England reasonably entertains doubts about
whether the Panel has been or is able to be impartial in the Fifth
Arbitration, including, whether and to what extent O’Brien’s
simultaneous business relationship with the AAA may have
impacted the administration of the proceedings vis-à-vis the AAA
and the Panel.”
V.    New England Requests Arbitrator Disqualification
and Supplemental Disclosures
      On September 24, 2021, New England requested in writing
that the arbitrators disqualify themselves and disclose the full
nature and extent of the business relationship between the AAA

                                8
and O’Brien during O’Brien’s representation of Cooner Sales.
The arbitrators declined recusal on October 4, 2021.
       On October 5, 2021, New England requested that the panel
respond to its request for additional disclosures. The arbitrators
responded to this request on October 12, 2021, stating that they
would not “impose any requirement in this case that [they]
disclose Robert O’Brien’s present or past status as a AAA
arbitrator.” They further stated that they had no obligation to
investigate or disclose “the full nature and extent of O’Brien’s
business relationship with the AAA,” and instead were obligated
only to “restate the extent we knew Mr. O’Brien—not to report
whether he was a [sic] AAA arbitrator.” The arbitrators also
asserted that if anyone had such an obligation, it was the AAA,
not the individual arbitrators.
       On October 15, 2021, New England sent a letter to the AAA
requesting disclosure of the full extent of O’Brien’s business
relationship with the AAA from the time of his association into
the case in January 2015 to the time of his departure from
Larson O’Brien LLP in September 2019. New England also sent
the panel a “Notice of Disqualification to Panel Members.”
       The AAA responded to New England’s letter on October 25,
2021, stating: “AAA declines [New England’s] request for
information regarding AAA and [Cooner Sales’s] former counsel
Robert O’Brien. Standard 8(b) of California’s Ethics Standards
for Neutral Arbitrators in Contractual Arbitration calls for
additional provider organization-related disclosures only in
consumer arbitration cases. . . . Because this matter is not a

                                9
consumer arbitration, AAA will not provide the requested
information absent party agreement.”3
      The AAA’s Administrative Review Council denied New
England’s notice of disqualification on November 9, 2021. It
concluded the panel “should be reaffirmed as arbitrator for this
case.” The AAA further asserted that its decision was
“conclusive,” and any further objections to the panel “must be
based on new grounds.”
VI. New England Files Suit in Superior Court
      On November 24, 2021, New England filed a complaint
against Cooner Sales, Cooner Enterprises, and AAA in superior
court. In addition to the preceding allegations, it alleged that the
panel “engaged in a series of irregular actions” that would cause
a person aware of the facts to reasonably entertain a doubt about
the panel’s impartiality after O’Brien appeared in the arbitration
proceedings. The “irregular actions” “appeared to favor [Cooner
Sales] immediately, in the long term, and/or when considered in
the aggregate.” They included “repeatedly expanding the period
for which [Cooner Sales] could seek monetary relief and
repeatedly interjecting the Panel’s unilateral requests for
additional evidence into the arbitration proceedings, even though
the parties had already presented their respective cases.” New
England further alleged that the panel’s “failed disclosures and
usurpation of the Fifth Arbitration have been very costly,” in that

3     In accordance with section 1281.85, the Judicial Council
adopted ethics standards and requirements for neutral
arbitrators. The standards are intended to “guide the conduct of
arbitrators, to inform and protect participants in arbitration, and
to promote public confidence in the arbitration process.” (Ethics
Standards for Neutral Arbitrators, Standard 1(a).))

                                10
the panel had collected approximately $4.9 million in fees during
the Fifth Arbitration, including approximately $3.5 million
incurred after O’Brien appeared. Each of New England’s five
causes of action incorporated all preceding allegations.
       In the first cause of action, New England sought
provisional relief against the Cooner entities under section
1281.8. New England alleged that the arbitrators’ failure to
supplement their disclosures and disqualify themselves
“constitutes ongoing wrongful conduct, which unless and until
enjoined and restrained by order of this Court, will cause great
and irreparable injury” to New England. It alleged that it had
“no adequate remedy at law for the injuries currently being
suffered” and likely to be suffered, namely the “lost right to an
undoubtedly impartial arbitral proceeding.” It requested as relief
“a temporary restraining order, an order to show cause, a
preliminary injunction, and a permanent injunction disqualifying
the current arbitration Panel and setting aside all interim
awards issued by this disqualified Panel of arbitrators,” all of
which it asserted were “essential to avoid irreparable injury to
New England and to prevent the arbitration proceedings from
being rendered ineffectual.”
       In its second cause of action, New England sought
provisional relief under section 1281.8 against the Cooner
entities and AAA. New England alleged that arbitrators
Collisson and Burns actively practiced law throughout the Fifth
Arbitration and “may have represented parties in AAA
proceedings.” It further alleged that AAA “failed and is incapable
of providing the requisite case management services it advertises,
including, [sic] a complete, reliable, sufficient, and definitive
record of the arbitration proceedings,” and required New England

                               11
to create a “document repository at great effort and expense,
under severe and unfair time pressure, and subject to the Panel’s
order and threat that any evidence or other materials would be
excluded from the record if not timely included in the repository.”
New England requested “a temporary restraining order, an order
to show cause, a preliminary injunction, and a permanent
injunction disqualifying the Panel, setting aside all Interim
Awards issued by the disqualified AAA-appointed panel,
precluding the AAA from continuing as the DRPO for arbitration
proceedings between New England and [the] Cooner [entities],
and ordering that a different DRPO conduct arbitration
proceedings between [the] Cooner [entities] and New England
anew.”
       In its third cause of action, New England alleged that AAA
engaged in unfair competition in violation of the UCL. New
England alleged that AAA maintains a “secret arbitrator roster”
that is “comprised of a substantial number of actively practicing
attorneys who may represent or consult with clients in AAA
arbitration proceedings presided over by other AAA arbitrators
who also may be actively practicing attorneys.” New England
alleged that AAA “provides or can provide” its arbitrators with
access to the roster, “at least regarding other roster members who
represent parties before them so that the arbitrator may disclose
the relationship to the parties,” but does not do so as a matter of
policy in non-consumer arbitrations. New England alleged this
policy was contrary to AAA’s advertising, which represents that
AAA will “err on the side of transparency” and its arbitrators
“should disclose” any “relationship of interest [that] crosses the
arbitrator’s mind.” New England also alleged that AAA requires
its roster members to “pledge to support the AAA and also to

                                12
actively support both its policies and practices,” including
recommending the use of AAA and its rules, to remain on the
roster. Accordingly, New England alleged, AAA arbitrators’
financial success is “closely tied to the AAA’s business success
and business model,” and arbitration parties aware of these
circumstances might reasonably entertain a doubt about their
impartiality when an opposing party is represented by a member
of the roster. For these and other reasons, New England sought
“to enjoin the AAA and its arbitrators: (a) from continuing to
engage in such violations; and (b) from proceeding further with
the Fifth Arbitration, particularly pending a determination on
the merits of this complaint.”
       In its fourth cause of action, New England sought
“equitable severance of arbitration agreement term or condition”
against the Cooner entities. It alleged that AAA’s unfair and
unlawful business practices “render any interpretation of the
[Cooner Sales] Operating Agreement to require New England to
use the AAA as a DRPO both unconscionable and inequitable,
both in theory in and practice,” and New England would not be
assured of impartial proceedings “so long as any AAA arbitrator
presides over the arbitration proceedings or the AAA is the
DRPO.” New England acknowledged that the arbitration
provision in the Cooner Sales operating agreement “does not
expressly require that the parties use the AAA as the DRPO, only
that they arbitrate using the AAA’s then-obtaining rules,” and
explained it sought to restrict any interpretation of the
agreement to use AAA as the DRPO. It clarified that it was not
seeking monetary damages or restitution, but “merely a ruling
that the arbitration proceed anew before arbitrators affiliated
with a different DRPO and administered by that DRPO, utilizing

                              13
the AAA Commercial Arbitration Rules (aside from the rules
dealing with the selection of arbitrator(s)).”
       In its fifth cause of action for declaratory relief against all
defendants, New England sought “declaratory judgments and
injunctive relief . . . including, without limit, declarations that
the Panel members and AAA violated their disclosure and
disqualification obligations under applicable law, that there is no
requisite record of the Fifth Arbitration proceedings, that the
current arbitration Panel and AAA are disqualified, and that the
arbitration proceedings should proceed anew with a different
DRPO than the AAA.”
VII. Demurrers
       Cooner Sales, Cooner Enterprises, and AAA each
separately demurred to New England’s complaint.
       Larson LLP filed Cooner Sales’s demurrer on January 14,
2022. Cooner Sales generally demurred to the complaint in its
entirety under section 430.10, subdivision (e), asserting it failed
to state facts sufficient to constitute a cause of action. It also
specifically demurred to each of the causes of action against it.
Cooner Sales asserted that the first and second causes of action
for provisional relief under section 1281.8 were legally deficient
because New England failed to plead facts “demonstrating that (i)
a final award will be rendered ineffectual and it will suffer
irreparable harm absent provisional relief, (ii) it is likely to
succeed on the merits, and (iii) there is no adequate remedy at
law.” It further asserted that the potential harm to Cooner Sales
“significantly outweighs the potential harm to New England if
the Court upends the Fifth Arbitration.” With respect to the
fourth cause of action for equitable severance, Cooner Sales
argued that New England failed to identify a valid legal or

                                 14
factual basis for the requested relief. Cooner Sales asserted that
the fifth cause of action for declaratory relief was legally
deficient, based on untimely objections to the panel, and did not
concern a justiciable controversy.
       Cooner Enterprises also filed a demurrer on January 14,
2022. Like Cooner Sales, it generally demurred on the grounds
that New England failed to allege facts or law sufficient to
constitute causes of action. Cooner Enterprises asserted the first
and second causes of action for provisional relief under section
1281.8 failed to allege “facts sufficient to demonstrate the
Arbitrators’ final award will be ineffectual; that without
provisional relief, New England will suffer irreparable harm that
outweighs harm to Cooner Enterprises an injunction would
cause; that it (New England) is likely to succeed on the merits of
its disqualification theory; or that New England has inadequate
remedies at law.” Cooner Enterprises argued that the fourth and
fifth causes of action failed because they were “entirely
dependent” on the deficient first and second causes of action, and
also did not allege facts warranting the relief requested.
       AAA filed its demurrer on January 18, 2022. It argued that
the second, third, and fifth causes of action were legally deficient
because AAA was immune from suit under the doctrine of
arbitral immunity, AAA was not a necessary or proper party to
the action, and New England waived any right to sue AAA by
agreeing to its Commercial Arbitration Rules.
       All three defendants filed requests for judicial notice in
support of their demurrers. AAA requested that the court take
judicial notice of its Commercial Arbitration Rules, which were
cited in New England’s complaint. Cooner Sales and Cooner
Enterprises requested that the court take judicial notice of

                                15
several arbitral documents in support of their demurrers,
including New England’s demands for disqualification and
disclosure, the arbitrators’ and AAA’s responses, and the fourth
interim award.
       New England opposed the demurrers and requests for
judicial notice.
VIII. Motion to Disqualify Larson LLP
       On January 18, 2022, four days after Cooner Sales filed its
demurrer, New England filed a motion to disqualify Larson LLP
from representing Cooner Sales. New England asserted that the
arbitrators previously disqualified attorney Richmond and his
then-law firm, Jenner & Block, from representing both Cooner
Sales and Cooner Enterprises due to an actual conflict
precipitated by New England’s counterclaims against the Cooner
entities. New England further asserted that, on August 30, 2021,
it learned that Richmond had joined Larson LLP. New England
asserted that Larson LLP did not notify New England or the
arbitrators of Richmond’s affiliation with Larson LLP.
       New England asserted that it raised the issue in its
September 24, 2021 demand that the arbitrators disqualify
themselves, but did not file a motion to disqualify Larson LLP in
the arbitration because the arbitrators’ own alleged need for
disqualification deprived them of “the jurisdiction or authority ‘to
consider, act upon, or decide a motion to disqualify Larson LLP.’”
Cooner Sales nevertheless opposed the disqualification of its
counsel in its opposition to New England’s demand to disqualify
the arbitrators. According to New England, Cooner Sales claimed
Larson LLP obtained an ethics opinion and consent from Cooner
Enterprises before it hired Richmond, and also implemented an

                                16
ethical screen; neither Larson LLP nor Cooner Sales shared this
information with New England.
       New England argued disqualification was required because
Richmond already had been disqualified, and concerns about the
duty of loyalty mandated the vicarious disqualification of any
firm he subsequently associated with. It further argued that the
conflict at issue could not be resolved by the consent of Cooner
Sales or Cooner Enterprises, and consent from New England was
required but not given. New England argued that it had
standing to seek disqualification and was timely in its efforts to
do so. New England’s counsel filed a declaration in support of the
motion, to which he attached 17 supportive exhibits. New
England also filed a request for judicial notice in support of the
motion, and an ex parte request that the motion to disqualify be
heard before the demurrers.
       Cooner Sales opposed the motion to disqualify its counsel.
It also filed declarations from members of Larson LLP, including
Richmond, in support of the opposition. Cooner Sales contended
there was never a conflict of interest between Cooner Sales and
Cooner Enterprises in the first place, and the previous
disqualification of Richmond should not be imputed to Larson
LLP. It also asserted that New England lacked standing to
disqualify its counsel and filed the motion for an improper
purpose. Cooner Sales opposed the ex parte request to advance
the hearing of the motion to disqualify.
IX. Hearing and Ruling
       A.     Hearing
       The superior court granted in part New England’s request
to advance the hearing on the motion to disqualify Larson LLP
and rescheduled the hearings on all pending motions to the same

                               17
date. Prior to the hearing, the court issued a tentative ruling
stating an intention to sustain the demurrers without leave to
amend and deny the motion to disqualify Larson LLP as moot.
      At the hearing, the court expressed concern that New
England was “taking an interlocutory appeal of a matter that
would be resolved at the end of an arbitration and you are asking
me to essentially supervise the arbitration.” The court stated
that the Code of Civil Procedure included procedures to vacate an
arbitration award issued by biased arbitrators, but “that’s at the
end of the case.” The court heard arguments from all parties on
these substantive issues. It also heard extensive argument
regarding the motion to disqualify Larson LLP, and whether that
motion needed to be resolved prior to the demurrers.
      At the conclusion of the hearing, the court requested
supplemental briefing on two issues related to the motion to
disqualify: (1) whether the court was required to resolve the
motion before ruling on the demurrers, and (2) whether New
England was required to raise the disqualification issue with the
arbitrators before seeking relief in the superior court. New
England and Cooner Sales filed supplemental briefing addressing
the court’s questions. The court took the matter under
submission upon receipt of the supplemental briefing.
      B.     Ruling
      On April 11, 2022, the court issued a written order denying
the requests for judicial notice, sustaining the demurrers without
leave to amend, and denying the motion to disqualify Larson LLP
as moot. The court concurrently entered an order dismissing the
action with prejudice.
      In the written order, the court stated that it sustained the
Cooner entities’ demurrers to the first and second causes of action

                                18
for provisional relief “for multiple independent reasons.” First,
the court ruled that New England “seek[s] a remedy beyond the
scope authorized by Code of Civil Procedure section 1281.8.” The
court explained that section 1281.8 authorized only “provisional”
or temporary remedies aimed at maintaining the status quo, such
as temporary restraining orders, writs of possession, and
appointment of receivers. The court found that New England
instead sought “affirmative relief from the court,” namely
removing the arbitrators and DRPO, vacating all interim awards,
and starting the arbitration anew. The court concluded such
expansive relief was beyond that authorized by the plain
language of section 1281.8. The court added that even if it were
to look beyond the plain language of section 1281.8, it would
decline to afford the requested relief on the grounds that doing
would “undermine the intent of section 1285, et seq., which is that
arbitrations proceed without judicial interference and such
matters are resolved at the conclusion of the arbitration
proceeding.”
       In the alternative, the court concluded that New England
failed to establish that provisional relief was necessary and it had
no adequate remedy at law. Quoting Azteca Construction, Inc. v.
ADR Consulting, Inc. (2004) 121 Cal.App.4th 1156, 1167 (Azteca),
it reiterated that the “‘penalty for noncompliance’ with applicable
disclosure requirements is ‘judicial vacation of the arbitration
award,’” which constituted an adequate remedy at law. It further
concluded that New England failed to demonstrate a likelihood of
success on the merits, because the disclosures it wanted the
arbitrators to make were required only in consumer arbitrations,
and O’Brien’s mere appearance on the roster of AAA arbitrators
“raises no question whether they would be fair and impartial.”

                                19
The court added that even if New England were likely to succeed
on the merits, it “waived the right to seek disqualification on this
issue” by failing to timely seek disqualification of the arbitrators
after O’Brien’s comments regarding his relationship with AAA.
       The court sustained the demurrer to the third cause of
action for unfair competition, concluding “it is derivative of the
first and second causes of action.” The court also sustained the
demurrers to the fourth cause of action for equitable severance
and the fifth cause of action for declaratory relief “for the reasons
discussed” in connection with the first and second causes of
action. It added that declaratory relief was not warranted
because such relief “‘should not be used for the purpose of
anticipating and determining an issue which can be determined
in the main action.’”
       The court denied the motion to disqualify Larson LLP as
moot, “having ruled that Plaintiffs’ action is untenable as a
matter of law.” It rejected New England’s contention that it was
required to resolve the disqualification motion before ruling on
the demurrers, noting New England’s acknowledgement that
“California courts have not directly answered this question” and
citing its inherent power to control matters pending before it.
The court explained that policy considerations did not change its
ruling, because “no unfair advantage would be afforded to
[Cooner Sales] by ruling on the demurrer before ruling on the
motion for disqualification. Mr. Richmond’s employment at
Larson LLP does not affect the court’s interpretation of section
1281.8 and its application to the facts alleged in the complaint.”
The court also added that it declined to resolve the
disqualification motion first in part due to New England’s
“gamesmanship”: “Plaintiffs’ insistence that the court rule on

                                 20
this motion first is nothing more than an attempt to have this
court issue an order of disqualification against Larson LLP,
which Plaintiffs would then cite as collateral estoppel before the
arbitration panel. The arbitration panel—not this court—should
resolve any issue whether Mr. Richmond’s employment precludes
Larson LLP from continuing to represent [Cooner Sales] in the
arbitration.”4
      New England timely appealed. It also filed a request that
we take judicial notice of the complaint it filed in 2014 to
disqualify Richmond, and the superior court’s ruling in that case.
That motion is denied as unnecessary to resolution of this appeal.
(See JRS Products, Inc. v. Matsushita Electric Corp. of America
(2004) 115 Cal.App.4th 168, 174 & fn. 4.)
                           DISCUSSION
I.    Demurrers
      New England contends the court improperly sustained the
demurrers because its complaint alleged facts sufficient “to state
disqualification of both the arbitrators and AAA,” “to state UCL
claims against AAA,”
      A.     Standard of Review
      A demurrer tests the legal sufficiency of the factual
allegations in a complaint. (Title Ins. Co. v. Comerica Bank–
California (1994) 27 Cal.App.4th 800, 807.) We review de novo
the dismissal of a civil action after a demurrer is sustained
without leave to amend. (Cantu v. Resolution Trust Corp. (1992)
4 Cal.App.4th 857, 879 (Cantu).) In doing so, “we determine

4     Cooner Sales represents in its brief, without citation to the
record, that New England filed a motion to disqualify Larson LLP
in the Fifth Arbitration shortly after the superior court issued its
ruling, and the motion remains pending.

                                21
whether the complaint states facts sufficient to constitute a cause
of action.” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) “‘We
treat the demurrer as admitting all material facts properly
pleaded, but not contentions, deductions or conclusions of fact or
law.’” (Ibid.) “Further, we give the complaint a reasonable
interpretation, reading it as a whole and its parts in their
context.” (Ibid.)
       The appellant bears the burden of demonstrating that the
superior court erroneously sustained the demurrer as a matter of
law. (Rakestraw v. California Physicians’ Service (2000) 81
Cal.App.4th 39, 43.) To establish that a cause of action has been
adequately pled, an appellant must demonstrate he or she has
alleged “facts sufficient to establish every element of that cause of
action. [Citation.]” (Cantu, supra, 4 Cal.App.4th at pp. 879–880.)
If the complaint fails to plead any essential element of a
particular cause of action, we affirm the sustaining of a
demurrer. (Ibid.) Additionally, “[w]e review the correctness of
the trial court’s action in sustaining the demurrer, not the court’s
statement of reasons for its action.” (Martis Camp Community
Assn. v. County of Placer (2020) 53 Cal.App.5th 569, 610.)
Accordingly, “[w]e affirm the judgment if it is correct for any
reason, regardless of the trial court’s stated reasons.” (MKB
Management, Inc. v. Melikian (2010) 184 Cal.App.4th 796, 802.)
       We review an order denying leave to amend for an abuse of
discretion. “If we find that an amendment could cure the defect,
we conclude that the trial court abused its discretion and we
reverse; if not, no abuse of discretion has occurred.” (Schifando v.
City of Los Angeles (2003) 31 Cal.4th 1074, 1081.) The appellant
bears the burden of demonstrating the manner in which the
complaint might be amended. (Ventura29 LLC v. City of San

                                 22
Buenaventura (2023) 87 Cal.App.5th 1028, 1037; Blank v.
Kirwan, supra, 39 Cal.3d at p. 318.)
       B.     First and Second Causes of Action
       In its first and second causes of action, New England
sought provisional relief under section 1281.8. “Provisional
remedies” authorized by section 1281.8 “include[] the following:
(1) Attachments and temporary protective orders . . . [;] (2) Writs
of possession . . . [;] (3) Preliminary injunctions and temporary
restraining orders issued pursuant to Section 527[; and] (4)
Receivers appointed pursuant to Section 564.” (§ 1281.8, subd.
(a).) A party to an arbitration proceeding may apply for a
provisional remedy under section 1281.8 “only upon the ground
that the award to which the applicant may be entitled may be
rendered ineffectual without provisional relief.” (§ 1281.8, subd.
(b).) This is because the statute “does not speak to any and all
types of harm. It addresses only a circumstance in which a party
might prevail in an arbitration but still have no recourse due to
some changing condition.” (Riverside County Sheriff’s
Department v. Stiglitz (2014) 60 Cal.4th 624, 633.)
       “[T]he possibility that an arbitration award might be
rendered ineffectual is a threshold or minimum requirement.”
(Woolley v. Embassy Suites, Inc. (1991) 227 Cal.App.3d 1520,
1529 (Woolley).) “The logical reason” for this requirement “is to
ensure that the court does not invalidate the province of the
arbitrator—i.e., the court should be empowered to grant
provisional relief in an arbitrable controversy only where the
arbitrator’s award may not be adequate to make the aggrieved
party whole.” (Id. at p. 1527.) Beyond this minimum
requirement, the ordinary statutory or common law requirements
for obtaining the desired provisional remedy still apply; section

                                23
1281.8 was intended to preserve the rules of equity that generally
apply in the context of provisional relief. (Id. at p. 1528; see also
California Retail Portfolio Fund GMBH & Co. KG v. Hopkins
Real Estate Group (2011) 193 Cal.App.4th 849, 856.) Thus, a
party seeking injunctive relief pursuant to section 1281.8 must
demonstrate that it satisfies the traditional requirements for
such relief: “that the applicant is likely to prevail on the merits,
has no adequate alternative remedy, and will suffer irreparable
harm if the injunction is denied.” (Davenport v. Blue Cross of
California (1997) 52 Cal.App.4th 435, 450.)
             1.    Adequate Alternative Remedy
      The failure of the arbitrators to disqualify themselves is not
a “changing condition” that might leave New England with no
recourse against the Cooner entities. This alone severely
undermines the claims for provisional relief under section 1281.8.
Even if we assume a final arbitration award would be ineffectual
due to the arbitrators’ failure to disqualify themselves, the
existence of an adequate alternative remedy is clear. The
California Arbitration Act, § 1280, et. seq., addresses both the
grounds for disqualification of an arbitrator and the remedy if the
arbitrator improperly fails to disqualify himself or herself.
Section 1281.91, subdivision (d) states in part, “If any ground
specified in Section 170.1 exists, a neutral arbitrator shall
disqualify himself or herself upon the demand of any party made
before the conclusion of the arbitration proceeding.” If the
arbitrator “was subject to disqualification upon grounds specified
in Section 1281.91 but failed upon receipt of timely demand to
disqualify himself or herself as required by that provision,” the
superior court must vacate the arbitration award. (§ 1286.2,

                                 24
subd. (a)(6); see also Haworth v. Superior Court (2010) 50 Cal.4th
372, 381 (Haworth).)
       New England acknowledges that vacatur of a final
arbitration award is “one means of judicial enforcement,” but
contends “[i]mmediate review also makes sense” because a
disqualified arbitrator lacks the power, right, or privilege to hear
a case. We disagree. Numerous cases demonstrate that the
appropriate remedy when an arbitrator fails to make required
disclosures is vacatur of the final award pursuant to section
1286.2, subdivision (a)(6). (See, e.g., Haworth, supra, 50 Cal.4th
at p. 383 [“In the event Ossakow establishes that Judge Gordon
failed to make a required disclosure, she is entitled to vacation of
the arbitration award”]; Grabowski v. Kaiser Foundation Health
Plan, Inc. (2021) 64 Cal.App.5th 67, 80 [“The arbitrator did not
make the required disclosure. [Section 1286.2, subdivision
(a)(6)(A)] therefore requires that the arbitration award be
vacated, without any further showing.”]; Roussos v. Roussos
(2021) 60 Cal.App.5th 962, 974 [“[D]espite Ted’s notice of
disqualification, the arbitrator refused to disqualify himself. The
trial court was therefore required to vacate the award under
section 1286.2, subdivision (a)(6)(B).”]; Honeycutt v. JPMorgan
Chase Bank, N.A. (2018) 25 Cal.App.5th 909, 930 [“under section
1286.2, the arbitrator’s failure to disclose the four arbitrations
with counsel for Chase was a failure ‘to disclose within the time
required for disclosure a ground for disqualification of which the
arbitrator was then aware,’ which requires vacatur of the
award”]; Azteca, supra, 121 Cal.App.4th at p. 1169 [“Since . . .
Taylor’s pre-arbitration disqualification was mandatory, the
award to ADR Consulting must be vacated.”].) “‘A remedy is not
inadequate merely because more time would be consumed by

                                25
pursuing it through the ordinary course of law.’” (Baeza v.
Superior Court (2011) 201 Cal.App.4th 1214, 1221.)
       New England relies on Advantage Medical Services, LLC. v.
Hoffman (2008) 160 Cal.App.4th 806 (Advantage Medical) to
support its contention that interim awards “may be subject to
immediate judicial review.” In Advantage Medical, an AAA
arbitrator who was also a practicing attorney allowed “coverage
counsel” for Advantage Medical’s insurer to be present during the
arbitration hearing. (Advantage Medical, supra, 160 Cal.App.4th
at p. 811.) When counsel announced her appearance as “coverage
counsel for Lloyds [sic] of London,” the arbitrator did not inquire
into the identity of the Lloyd’s syndicates counsel represented,
nor did he disclose that he and his law firm represented “P & I
Clubs” that were “directly tied to Lloyd’s of London through
maritime syndicates.” (Id. at p. 812.)
       Hoffman discovered this information only after the
arbitrator issued an interim award in Advantage Medical’s favor.
(Advantage Medical, supra, 160 Cal.App.4th at p. 812.) Hoffman
alerted AAA to the issue and requested disqualification of the
arbitrator and additional disclosures. (Ibid.) After the arbitrator
declined to respond to the request for disclosures and refused to
disqualify himself, and AAA confirmed his appointment, Hoffman
filed suit in superior court. (Id. at pp. 812-813.) Specifically,
Hoffman “filed a petition for an order disqualifying the arbitrator
under section 1281.91, subdivision (a)(1) and (2) and vacating the
interim award under sections 1286 and 1286.2, subdivision
(a)(6).” (Id. at p. 813.) The superior court concluded the
arbitrator violated Ethics Standard 7 (“Standard 7”) of the Ethics
Standards for Neutral Arbitrators in Contractual Arbitrators
(“Ethics Standards”) and section 1281.9 by failing to disclose his

                                26
relationship with Lloyd’s syndicates, and that a person aware of
the facts could reasonably entertain a doubt as to the arbitrator’s
impartiality. (Id. at p. 815.) It accordingly disqualified the
arbitrator and vacated the interim award under section 1286.2,
subdivision (a)(6). (See id. at pp. 816-817.) Advantage Medical
appealed. The appellate court reversed the superior court’s order
disqualifying the arbitrator but affirmed vacatur of the award
after concluding the superior court’s ruling was supported by
substantial evidence. (Id. at pp. 818-819.)
       Advantage Medical is distinguishable procedurally. First,
the appellate court did not discuss the interim nature of the
challenged arbitration award. Cases are not authority for
propositions they do not consider. (B.B. v. County of Los Angeles
(2020) 10 Cal.5th 1, 11.) Second, Hoffman did not seek
provisional relief under section 1281.8; instead, she pursued
vacatur of the award under section 1286.2, subdivision (a)(6), the
prescribed avenue for relief when an arbitrator fails to make
required disclosures or disqualify himself or herself. (See Azteca,
supra, 121 Cal.App.4th at p. 1167 [the “penalty for
noncompliance” with disclosure requirements is “judicial vacation
of the arbitration award”].) Third, the appellate court reversed
the superior court’s order disqualifying the arbitrator because it
concluded that the California Arbitration Act “does not provide
for the disqualification of an arbitrator after he or she has ruled
on an issue of contested fact.” (Advantage Medical, supra, 160
Cal.App.4th at p. 810.) It held that the petition to disqualify the
arbitrator “was not viable because he had already issued the
interim award,” and Hoffman’s “recourse was to seek vacatur of
the interim award based on [the arbitrator’s] failure to comply
with disclosure requirements.” (Id. at p. 821.) According to New

                                27
England’s brief, disqualification of the arbitrators is the very
relief it seeks, despite their issuance of four interim awards.
Advantage Medical is directly contrary to this request. 5
              2.    No Likelihood of Success on the Merits
                    a.     No Duty to Disclose
       New England argues that it alleged facts sufficient to
prevail on the merits, namely that the arbitrators had a duty to
inquire about and disclose O’Brien’s relationships with AAA
under the applicable statutes and Ethics Standards. The
superior court found this argument wanting, as do we.
       To ensure that arbitrators serve as impartial
decisionmakers, the California Arbitration Act “requires the
arbitrator to disclose to the parties any grounds for
disqualification.” (Haworth, supra, 50 Cal.4th at p. 381.)
“Within 10 days of receiving notice of his or her nomination to

5      Section 1281.91, subdivision (d) provides that “[i]f any
ground specified in Section 170.1 exists, a neutral arbitrator shall
disqualify himself or herself upon the demand of any party made
before the conclusion of the arbitration proceeding.” Advantage
Medical did not discuss the impact of this provision on the
timeliness of Hoffman’s petition, despite her reliance on section
1281.9, subdivision (a)(1), which requires arbitrators to disclose
“[t]he existence of any ground specified in Section 170.1 for
disqualification of a judge.” Even if section 1281.91, subdivision
(d) extends the timeframe in which a party may seek
disqualification beyond the resolution of a contested issue of fact,
the party still must “show the omitted disclosures were
disqualifying within the meaning of the governing statutes and
ethics standards as a matter of law.” (Speier v. The Advantage
Fund, LLC (2021) 63 Cal.App.5th 134, 151 (Speier).) As
discussed more fully below, New England did not make that
showing.

                                28
serve as a neutral arbitrator, the proposed arbitrator is required,
generally, to ‘disclose all matters that could cause a person aware
of the facts to reasonably entertain a doubt that the proposed
arbitrator would be able to be impartial.’” (Ibid., quoting
§ 1281.9, subd. (a).) Matters that must be disclosed include
“[a]ny matters required to be disclosed by the ethics standards for
neutral arbitrators adopted by the Judicial Council . . .,” and
“[a]ny professional or significant personal relationship the
proposed neutral arbitrator . . . has or has had with any party to
the arbitration proceeding or lawyer for a party.” (§ 1281.9, subd.
(a)(2), (6).) Arbitrators must also disclose “[t]he existence of any
ground specified in Section 170.1 for disqualification of a judge”
(§ 1281.9, subd. (a)(1)), including any reason “[a] person aware of
the facts might reasonably entertain a doubt that the judge
would be able to be impartial.” (§ 170.1, subd. (a)(6)(A)(iii).) “The
Ethics Standards require the disclosure of ‘specific interests,
relationships, or affiliations’ and other ‘common matters that
could cause a person aware of the facts to reasonably entertain a
doubt that the arbitrator would be able to be impartial.’”
(Haworth, supra, 50 Cal.4th at p. 381.) Ethics Standard 7 sets
forth numerous matters that must be disclosed by a person
nominated or appointed as an arbitrator. (See generally Ethics
Standards for Neutral Arbitrators, Standard 7.) It also provides
that the duty of disclosure is a continuing one. (See Ethics
Standards for Neutral Arbitrators, Standard 7(c), (f).)
       Ethics Standard 8 lists additional disclosures that must be
made in consumer arbitrations,6 including “[a]ny significant past,

6     “A ‘consumer arbitration’ is ‘an arbitration conducted under
a predispute arbitration provision contained in a contract’ where

                                 29
present, or currently expected financial or professional
relationship or affiliation between the administering dispute
resolution provider organization and a party or lawyer in the
arbitration.” (Ethics Standards for Neutral Arbitrators,
Standard 8(b)(1).) It expressly provides that “[a]n arbitrator is
not required to make the disclosures required by this standard if
he or she reasonably believes that the arbitration is not a
consumer arbitration based on reasonable reliance on a consumer
party’s representation that the arbitration is not a consumer
arbitration.” (Ethics Standards for Neutral Arbitrators,
Standard 8(a)(2).)
       New England acknowledges that the Fifth Arbitration is
not a consumer arbitration, and asserts that it is not relying on
Ethics Standard 8 here. However, it relies on Gray, which held
that a superior court erred in denying a section 1286.2 petition to
vacate an arbitration award where the arbitrator failed to comply
with Ethics Standard 8. (See Gray, supra, 212 Cal.App.4th at pp.
1364-1366.) New England asserts that Gray stands for the
broader proposition that disclosure of the DRPO-attorney
relationship required by Ethics Standard 8 is also required under
section 1281.9, subdivision (a)(1), the catchall provision requiring
disclosure of all matters that could cause a person aware of the
facts to reasonably entertain a doubt that the proposed arbitrator
would be able to be impartial. New England specifically points to
a footnote in Gray stating that a reasonable person could doubt
the ability of the arbitrator to be impartial where he and an
attorney in the matter belonged to the same DRPO, knew of one

the ‘consumer party was required to accept the arbitration
provision in the contract.’” (Gray v. Chiu (2013) 212 Cal.App.4th
1355, 1363 fn. 4, quoting Ethics Standard 2(d)(3).)

                                30
another’s affiliation prior to the arbitration, and worked from the
same office where photographs of the DRPO’s arbitrators were
displayed. (See Gray, supra, 212 Cal.App.4th at pp. 1360, 1364,
fn. 5.)
        This broad reading of Gray does not square with the
explicit proviso in Ethics Standard 8(a)(2) that the disclosures
required by Ethics Standard 8 are not required unless the
arbitration is a consumer arbitration. Even if Gray bore the
weight New England seeks to place upon it, New England did not
allege facts nearly as egregious as those summarized in the
footnote. There are no allegations in the complaint that O’Brien
and the arbitrators knew one another, shared an office, or even
saw one another prior to the arbitration. The disclosure of their
shared affiliation with AAA was thus not required unless, “under
the specific facts and circumstances of the case, the information
could reasonably raise a doubt in a person aware of the facts and
about the arbitrator’s impartiality.” (Speier, supra 63
Cal.App.5th at pp. 149-150.) This standard is an objective one
(id. at pp. 147-148), and “‘[a]n impression of possible bias in the
arbitration context means that one could reasonably form a belief
that an arbitrator was biased for or against a party for a
particular reason.’” (Haworth, supra, 50 Cal.4th at p. 389.) Here,
although New England alleges the arbitrators were biased, it also
alleges that the arbitrators’ rulings and interim awards have
been mixed, with some favoring the Cooner entities and others
favoring New England. An objective observer would not
reasonably entertain a doubt about the arbitrators’ impartiality.
              b.     Delay in Seeking Relief
        Even if disclosures were required, New England’s delay in
requesting them provides an alternative basis for affirming the

                                31
ruling. Advantage Medical is instructive. There, Hoffman sought
to obtain additional disclosures and disqualify the arbitrator
shortly after learning that he and his firm had a connection to
Lloyd’s of London. Here, New England explicitly alleges that
O’Brien “offhandedly indicated in an early colloquy with the
Panel that he had previously stood in their shoes as a AAA
arbitrator or been a speaker at the AAA’s request.” Rather than
seek further disclosures from or disqualification of the arbitrators
at that time, New England waited an additional six years to raise
the issue. “If a party learns the arbitrator failed to disclose
information relevant to disqualification, the party must object ‘at
the earliest practicable opportunity after discovery of the facts
constituting the ground for disqualification.’ (§ 170.3, subd.
(c)(1).) ‘While failure to disclose properly a ground for
disqualification generally mandates vacation of the award, this
rule only applies if the party moving to vacate “had no reason to
know of the existence of a nondisclosed matter.” [Citation.] If a
party is “aware that a disclosure is incomplete or otherwise fails
to meet the statutory disclosure requirements,” the party “cannot
passively reserve the issue for consideration after the arbitration
has concluded.”’ [Citation.]” (Alper v. Rotella (2021) 63
Cal.App.5th 1142, 1152-1153; see also Goodwin v. Comerica
Bank, N.A. (2021) 72 Cal.App.5th 858, 870 (Goodwin).)7 New
England pleads its awareness in the complaint.

7      Both New England and Cooner Sales relied on Goodwin
during oral argument. Although Goodwin supports the
proposition that section 1281.91, subdivision (d) extends the time
to seek disqualification beyond a hearing on any contested issue
of fact where “any ground specified in Section 170.1 exists” (see
Goodwin, supra, 72 Cal.App.5th at p. 869), it also holds that a

                                32
       In its briefing and during oral argument, New England
suggested it was excused from acting in 2015 because O’Brien’s
comments suggested only a previous affiliation with AAA, not a
current one. However, “[c]ourts have also held that if the
arbitrator disclosed information or a party had actual knowledge
of information putting the party on notice of a ground for
disqualification, yet the party failed to inquire further, the
arbitrator’s failure to provide additional information regarding
the same matter does not justify vacating the award.” (Mt.
Holyoke Homes, L.P. v. Jeffer Mangels Butler & Mitchell, LLP
(2013) 219 Cal.App.4th 1299, 1314.) Here, New England alleges
actual knowledge of at least a potential conflict of interest
involving O’Brien as early as 2015. Its delay in raising concerns
precludes it from demonstrating the likelihood of prevailing on
the merits necessary to support injunctive relief under section
1281.8.
       For all these reasons, the superior court properly sustained
the demurrers to the first and second causes of action. New
England asserts that it “should be allowed to take discovery and
amend its complaint to allege additional facts about O’Brien’s
undisclosed, extensive AAA relationships for the nearly five years
he was Cooner [Sales]’s lead counsel in the arbitration,” but it
gives no indication what its additional allegations may be or how
they may cure the defects in its claims. We thus are unable to
conclude the court abused its discretion by denying leave to
amend. (See Moore v. Centrelake Medical Group Inc. (2022) 83
Cal.App.5th 515, 537.

party is “required to ‘object “at the earliest practicable
opportunity after discovery of the facts constituting the ground
for disqualification[.]”’” (Id. at p. 870.)

                                33
      C.     Remaining Causes of Action
             1.     Third Cause of Action
       The superior court also sustained respondents’ demurrers
to the third, fourth, and fifth causes of action. In the third cause
of action, New England alleged that AAA’s business model
(including its “secret roster” and policies of not disclosing when
counsel belongs to AAA and requiring pledges of support) and
advertising campaigns touting transparency were unfair, false,
and misleading, in violation of the UCL. The superior court
sustained AAA’s demurrer to this cause of action on the grounds
that it was “derivative of the first and second causes of action.”
New England contends it stated a valid UCL claim. It highlights
AAA’s alleged policy of not disclosing “when a party is
represented in AAA arbitrations by a lawyer who is an AAA
arbitrator,” which it asserts is unlawful because it violates
sections 170.1, subd. (a)(6)(A)(iii) and 1281.9, subdivision (a)(1),
both of which require disqualification of an arbitrator where a
person aware of the facts might reasonably entertain a doubt as
to an arbitrator’s impartiality. New England adds that parties to
AAA arbitrations might entertain such doubt if “an adverse
party’s lawyer is an active AAA arbitrator and may also accept
AAA matters during arbitration,” or if they knew “the lawyer and
arbitrator had pledged to always promote AAA.”
       The UCL broadly defines unfair competition as “any
unlawful, unfair or fraudulent business act or practice and
unfair, deceptive, untrue or misleading advertising.” (Bus. &
Prof. Code, § 17200.) For instance, a business practice may be
“unfair” under the UCL even if not prohibited by other law.
(Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th

                                34
1134, 1143.) “While the scope of conduct covered by the UCL is
broad, its remedies are limited. [Citation.] A UCL action is
equitable in nature; damages cannot be recovered.” (Id. at p.
144.) Plaintiffs are generally limited to restitution or injunctive
relief. (Ibid.) New England requests the latter here, specifically
preliminary and permanent injunctions staying the arbitration
proceedings, enjoining the arbitrators and AAA from continuing
to engage in the alleged disclosure and disqualification violations,
and enjoining the arbitrators and AAA from proceeding further
with the arbitration.
       Though there is considerable overlap between the
allegations of the UCL claim and those made elsewhere in the
complaint, it is a stretch to deem the UCL claim wholly
derivative of the others. The claim here rests on at least some
allegations outside its other causes of action—in particular, its
allegations about AAA’s allegedly false advertising of case
management services. (Medical Marijuana, Inc. v.
ProjectCBD.com (2020) 46 Cal.App.5th 869, 896 [UCL claim is
wholly derivative where it is based solely on allegations of other
claims].) Presumably cognizant of this, New England and AAA
both address another basis on which AAA demurred to the cause
of action: arbitral immunity.
       Arbitral immunity shields arbitrators from “‘court actions
for their activities in arriving at their award.’” (Stasz v. Schwab
(2004) 121 Cal.App.4th 420, 430 (Stasz).) The doctrine is well
established in California. (Ibid.) “The application of arbitral
immunity does not turn on whether the act is discretionary
instead of ministerial or administrative.” (Id. at p. 431.) Instead,
it shields all functions that are integrally related to the arbitral
process, even where arbitrators fail to exercise proper care, skill,

                                35
or impartiality in their performance of arbitral functions.8 (Id. at
pp. 431, 438.) Arbitral immunity extends “to organizations that
sponsor arbitrations, like the AAA.” (Id. at p. 433.)
       New England contends its third cause of action cannot be
subject to arbitral immunity because arbitral immunity only
shields arbitrators and DRPOs from liability for damages, and
UCL claims can only seek equitable relief. AAA responds it is
entitled to arbitral immunity. It cites La Serena Properties, LLC
v. Weisbach (2010) 186 Cal.App.4th 893 (La Serena), which we
find materially indistinguishable from the instant case.
       In La Serena, parties to an arbitration administered by
AAA sued the arbitrator and the AAA “alleging five separate
causes of action, all of which arise out of the alleged failure of
arbitrator Weisbach to disclose a certain conflict of interest
during the appointment process”—a romantic relationship with
the sibling of an attorney representing the party opposing
plaintiffs. (La Serena, supra, 186 Cal.App.4th at p. 896, 897.)
The plaintiffs sought “damages, as well as other relief”; their
causes of action included a UCL claim alleging false advertising.
(Id. at pp. 896, 899-900.) Weisbach and the AAA both filed
demurrers contending that the suit was barred by arbitral
immunity for quasi-judicial acts. (Id. at p. 900.) The superior
court agreed and sustained the demurrers without leave to
amend. (Ibid.)
       The appellate court affirmed. It concluded there was “no
doubt that the alleged failure to make adequate disclosures of
potential conflicts of interest falls within the scope of the absolute

8    Stasz reiterates that the “remedy for arbitrator bias or
misconduct is a civil action seeking to vacate the arbitration
award.” (Stasz, supra, 121 Cal.App.4th at p. 438.)

                                 36
immunity for quasi-judicial acts.” (Id. at p. 903.) The court
rejected the plaintiffs’ contention that arbitral immunity did not
reach their claims for “conspiracy to commit fraud while soliciting
arbitration business.” (Id. at pp. 905-906.) It emphasized that
“the gravamen of [plaintiffs’] claims against Weisbach and AAA
relates to the failure to disclose a proposed relationship with a
party that was required to be disclosed,” and concluded that
“creative pleading” could not circumvent the doctrine. (Id. at p.
906.) Notably, the court found support in an analogous case
holding that plaintiffs could not evade the litigation privilege “by
trying to frame a derivative cause of action for violating the
Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.).”
(Ibid.) The court held the “alleged claims of misconduct, no
matter how pleaded, all arise out of the conflict of interest
disclosure procedure that is integrally part of the arbitration
process” and affirmed the judgment in full, even as to the UCL
claim. (Id. at pp. 896-897.)
       New England argues La Serena is distinguishable because
it involved claims for damages in addition to those seeking
equitable relief. We are not persuaded. Nothing in the reasoning
of La Serena depends on a distinction between claims for
monetary damages (which, in any event, are not an available
remedy under the UCL) and claims for equitable relief. Much
like La Serena, the gravamen of New England’s UCL claim is a
challenge to the arbitration’s disclosure process. The claim
concerns the arbitrators’ and AAA’s failure to disclose any
information about O’Brien, and even the bulk of the advertising
allegations concern representations about disclosure and
transparency. The remedy that New England seeks is, in part,
an injunction enjoining the ongoing arbitration. That its UCL

                                37
claim seeks injunctive relief does not alter the fact that New
England hopes to use the UCL to impose collateral liability on
AAA based upon AAA’s conduct of functions integral to the
process of an arbitration in which New England is a party—
precisely what arbitral immunity forbids. The other authorities
on which New England relies do not involve efforts by arbitration
parties to interfere with the arbitration process, and do not
address the concerns raised in La Serena. In addition, those
authorities are largely federal, and at least one is unpublished.
None is as analogous or persuasive as La Serena, which we follow
here in light of the circumstances of this case.
       New England has not demonstrated how it would amend
the third cause of action to avoid arbitral immunity. Therefore,
we decline to find the superior court abused its discretion by
denying leave to amend.
             2.     Fourth Cause of Action
       New England does not make any substantive arguments
regarding the fourth cause of action, which sought equitable
severance of any portion of the Cooner Sales operating agreement
that required the use of AAA as a DRPO, in its opening brief.
New England mentions the fourth cause of action in a footnote of
its reply brief, asserting that the facts giving rise to a reasonable
doubt as to the arbitrators’ impartiality “also support [New
England’s] fourth claim to sever such requirement.” This belated
and terse allusion to the fourth cause of action does little to
demonstrate the court erred in sustaining the demurrer without
leave to amend. (See Badie v. Bank of America (1998) 67
Cal.App.4th 779, 784-785 [“When an appellant fails to raise a
point, or asserts it but fails to support it with reasoned argument

                                 38
and citations to authority, we treat the point as waived.”].) We
accordingly find no basis to disturb that ruling.
             3.     Fifth Cause of Action
       With regard to the fifth cause of action for declaratory
relief, New England contends it adequately alleged the “actual
controversy relating to the legal rights and duties of the
respective parties” required by section 1060. It further asserts
that “AAA’s disqualification would not be determined in the
arbitration between the parties, and could not be duplicative.”
       “Where a trial court has concluded the plaintiff did not
state sufficient facts to support a statutory claim and therefore
sustained a demurrer as to that claim, a demurrer is also
properly sustained as to a claim for declaratory relief which is
‘wholly derivative’ of the statutory claim.” (Ball v. FleetBoston
Financial Corp. (2008) 164 Cal.App.4th 794, 800; see also § 1061
[“The court may refuse to exercise the power granted by this
chapter in any case where its declaration or determination is not
necessary or proper at the time under all the circumstances.”].)
The fifth cause of action seeks a declaratory judgment providing,
among other things, “Plaintiffs’ interpretation of the Panel
members’ investigation, disclosure, and disqualification
obligation is correct;” “Given the facts of this case, a person might
reasonably entertain a doubt that the arbitrators could be
impartial”; “The Panel members violated their duties of
investigation, disclosure, and disqualification under applicable
law”; “New England has no adequate remedy at law . . .”; “The
Panel members are disqualified as arbitrators in the Fifth
Arbitration”; “All interim awards issued by the Panel are set
aside”; “The AAA’s refusal to order the Panel members to
supplement their disclosures and disqualify themselves

                                 39
constitutes wrongful conduct”; and “The AAA’s wrongful conduct
entitles New England to all the provisional remedies [and
injunctive relief] it seeks in its Complaint.” These requests are
virtually identical to the allegations and demands made in the
first and second causes of action. The superior court accordingly
properly sustained the demurrer to the fifth cause of action
without leave to amend.
II.    Motion to Disqualify Counsel
       New England contends the superior court erred by
declining to address its motion to disqualify Cooner Sales’s
counsel. It further contends it should not need to “re-raise” the
issue of disqualification with the arbitrators, because they
already disqualified Richmond in 2015, and the disqualification
of Richmond’s new firm, Larson LLP, should be automatic and
unwaivable by consent or ethical screening. New England also
asserts it has standing to seek disqualification, and did so
promptly. We need only address its first contention, which we
reject.
       It is “well established that courts have fundamental
inherent equity, supervisory, and administrative powers, as well
as inherent power to control litigation before them.” (Rutherford
v. Owens-Illinois, Inc. (1997) 16 Cal.4th 953, 967.) These
inherent powers permit superior courts to exercise reasonable
control over all proceedings connected with pending litigation,
including rules of procedure, to ensure the orderly administration
of justice. (Ibid.) The Legislature also has recognized and
codified this authority, which encompasses the ability to
disqualify an attorney. (Ibid.; § 128, subd. (a)(5); see Cal Pak
Delivery, Inc. v. United Parcel Service, Inc. (1997) 52 Cal.App.4th
1, 8, 9 (Cal Pak).)

                                40
       The exercise of these inherent and statutory powers is a
matter vested within the sound discretion of the superior court,
and is subject to review under the abuse of discretion standard.
(See Schimmel v. Levin (2011) 195 Cal.App.4th 81, 87
(Schimmel).) The court’s discretion is not boundless, however; it
is limited by applicable legal principles, and its rulings may be
reversed if they lack a reasonable basis. (Cal Pak, supra, 52
Cal.App.4th at p. 9.)
       New England cites federal authority holding that “a district
court must reach the merits of a disqualification motion before
ruling on a dispositive motion.” (Bowers v. Ophthalmology Group
(6th Cir. 2013) 733 F.3d 647, 654-655; see also Grimes v. District
of Columbia (D.C. Cir. 2015) 794 F.3d 83, 90 [“Once a party
moves to disqualify an adverse party’s counsel, the district court
may not entertain a dispositive motion filed by the very counsel
alleged to be conflicted until the court has first determined
whether that counsel is disqualified.”].) Federal appellate court
decisions are not binding on this court, though we may consider
their persuasive value. (People v. Brooks (2017) 3 Cal.5th 1, 90.)
       New England also cites as “instructive” three Court of
Appeal cases: Schimmel, supra, 195 Cal.App.4th at pp. 87-88, Cal
Pak, supra, 52 Cal.App.4th at pp. 7-10, and Jarvis v. Jarvis
(2019) 33 Cal.App.5th 113 (Jarvis). None of these cases holds
that a court must rule on a disqualification motion before ruling
on a dispositive motion.
       In Schimmel, the appellate court concluded the superior
court did not abuse its discretion by resolving a motion to
disqualify prior to ruling upon a petition to compel arbitration
filed by the challenged attorney. (See Schimmel, supra, 195
Cal.App.4th at pp. 86-88.) The appellant contended that the

                                41
superior court should have granted the petition, then stayed the
action to permit the arbitrator to resolve the remaining motions,
including the motion to disqualify. (Id. at p. 86.) The appellate
court rejected this argument. Relying on section 128, subdivision
(a)(5), it held that the superior court “possesses the power to
control judicial proceedings in the furtherance of justice,” and did
not abuse that discretion by resolving the motions in the order it
did. (Id. at p. 87.)
       In Cal Pak, the superior court disqualified Cal Pak’s
counsel after he “admitted he had offered to sell out his client and
the class which the client was seeking to represent for a payment
to himself personally of approximately $8 to $10 million.” (Cal
Pak, supra, 52 Cal.App.4th at pp. 5-6.) On the same day, the
superior court sustained a demurrer to Cal Pak’s complaint
without leave to amend; the appellate court “observe[d] that it is
unclear whether the grant of the demurrer in this action
preceded or followed the disqualification ruling.” (Id. at pp. 7, 9.)
The appellate court nevertheless rejected counsel’s argument
that the superior court lacked jurisdiction to disqualify him after
it had sustained the demurrer and dismissed the case. (Id. at p.
9.) As in Schimmel, the appellate court emphasized the superior
court’s inherent power to control the proceedings before it. (Ibid.)
       In Jarvis, brothers Todd and James each controlled a 50
percent interest of a limited partnership that owned a parcel of
land. (Jarvis, supra, 33 Cal.App.5th at p. 120.) James filed an
action for partition of the land by sale, naming Todd and the
partnership as defendants. Todd and the partnership each filed
demurrers to the complaint. While the demurrers were pending,
James moved to disqualify Roscoe, the counsel representing the
partnership. (Id. at pp. 120-121.) The superior court heard the

                                 42
demurrers and the motion to disqualify at the same time. (Id. at
p. 127.) It granted the motion to disqualify Roscoe and dismissed
the demurrer he had filed on behalf of the partnership without
prejudice. (Ibid.) The appellate court affirmed; like the courts in
Schimmel and Cal Pak, it emphasized the superior court’s
inherent power to control the proceedings before it before
reaching the merits of the motion. (See id. at pp. 128, 133-140.)
       New England argues that these cases collectively
demonstrate “(1) a trial court should decide a motion to disqualify
counsel before deciding other issues, (2) if the trial court
disqualifies an attorney, the motions filed by that attorney should
be stricken, and (3) the trial court does not lose jurisdiction over a
motion to disqualify counsel even when it first decides a
dispositive motion and dismisses a case. Thus, the trial court
here should have ruled on [New England’s] motion to disqualify
Larson and, after determining that Larson had already been
disqualified, should have stricken the Cooner [Sales] demurrer
papers filed by his firm.”
       As New England acknowledged below, no California
authority, including those cited here, holds that courts must
address motions to disqualify before addressing other motions.
Schimmel, Cal Pak, and Jarvis all highlighted superior courts’
inherent powers to manage the proceedings before them. The
court here invoked the same powers, and considered “the specific
facts of this case,” including “gamesmanship” by New England,
when deciding to resolve the demurrers prior to the motion to
disqualify. New England has not demonstrated that this
considered exercise of discretion was beyond the bounds of
reason. We accordingly affirm the court’s denial of the motion as
moot.

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                        DISPOSITION
      The judgment is affirmed. Respondents may recover their
costs of appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                          COLLINS, J.

We concur:

CURREY, ACTING, P.J.

DAUM, J.


      Judge of the Los Angeles County Superior Court, assigned
by the Chief Justice pursuant to article VI, section 6 of the
California Constitution.

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