The Code Of Civil Procedure 1281.4 Stay Is Mandatory.
Top Kick Productions, Inc., Chuck Norris's production company, sued CBS Broadcasting Inc. over allegations of what might be characterized as Hollywood Accounting. CBS moved to compel arbitration, and to stay the litigation pursuant to CCP 1281.4, while Top Kick had a pending motion to disqualify CBS's attorneys based on conflict of interest. In true kick-ass Walker, Texas Ranger style, Top Kick convinced the trial court to hear the disqualification motion first, and to deny the stay request. Next, CBS obtained a temporary stay in the Court of Appeal, and the Court issued an OSC to determine whether the trial court had abused its discretion by denying the stay. CBS Broadcasting Inc., et al., Petitioners, v. Superior Court of Los Angeles County, Respondent; Top Kick Productions, Inc., et al., Real Parties in Interest, No. B292277 (2/7 2/21/19) (Zelon, Segal, Feuer) (not for publication).
The Court held that the trial court erred, because the 1281.4 stay is mandatory, once a petition to compel arbitration is brought. So now the stay will go into effect, the motion to compel arbitration will be heard, and if the motion is granted, then the arbitrator would get to rule on the disqualification motion.
The Court acknowledged that there are New York state law cases and federal law Second Circuit cases providing disqualification is not a matter for arbitrators to determine, but explains those cases are contrary to California law where disqualification motions have been decided by arbitrators. Furthermore, the Court acknowledges a situation might arise where the issue of disqualification is intertwined with the issue of arbitrability "so that the potentially disqualified lawyer should not be permitted to argue the motion to compel". However, because Top Kick conceded the disqualification motion had nothing to do with arbitrability, the Court did not need to address the issue.
The opening theme to Walker, Texas Ranger, is available on YouTube:
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