Dec. 18, 2025
Ruling limits automaker use of dealer arbitration clauses
An appeals court reversed an arbitration order, holding BMW could not enforce a dealership arbitration clause against a consumer's Song-Beverly warranty claims, vacating the arbitration award and judgment, and remanding the case for further trial court proceedings.
A California appellate court has reversed an LA judge's order compelling arbitration of a consumer warranty dispute against BMW of North America, holding that the automaker could not enforce an arbitration clause in a dealership sales contract to which the manufacturer was not a party.
Applying de novo review, the 2nd District Court of Appeal, Div. 3 panel concluded that as a nonsignatory, BMW failed to establish any legal basis to compel arbitration.
Because Superio...
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