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CLAIRE L. MOLESWORTH — #309100
SQUARE CAPITAL, LLC.
Legal Department
1455 Market St. #600 “FILED.
San Francisco, CA 94103 s ° * cat
Telephone: (415) 506-9435 uperior Court of California,
Facsimile: (415) 276-4510 ”
Email: clairem@squareup.com 04/12/2019
_ BY: CAROL BALISTRERI
Attorney for Petitioner SQUARE CAPITAL, LLC Deputy Clerk
SUPERIOR COURT OF THE STATE OF CALIFORNIA.
COUNTY OF SAN FRANCISCO
SQUARE CAPITAL, LLC, Case No. CPF 18-516392
Petitioner, MEMORANDUM OF POINTS AND
AUTHORITIES IN SUPPORT OF
v. MOTION TO GRANT PETITION TO
CONFIRM ARBITRATION AWARD
PLATTERS CATERING and SPREAD’Z
CATERING GROUP, INC., Judge: Law & Motion Judge
Date: May 13, 2019
Respondents. Time: 9:30 a.m.
Dept.: Dept. 302
Reservation No.: 04100513-10
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO GRANT PETITION TO
CONFIRM ARBITRATION AWARDCo ON Dn FW YY
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INTRODUCTION
Petitioner Square Capital, LLC (“Square Capital”) brings this petition to confirm an
arbitration award issued in its favor against respondents Spread’z Catering Group, Inc.
(“Spread’z”) and Platters Catering (“Platters”) (collectively, “Respondents”). Respondents
acquired a loan through Square Capital, which they failed to repay. Square Capital then initiated
arbitration proceedings as provided under written agreements entered into with Respondents. The
American Arbitration Association (“the AAA”) entered an award in favor of Square Capital
against Respondents in the amount of $86,313.89. Therefore, Square Capital petitions this Court
to confirm the award and enter judgment accordingly.
FACTS AND PROCEDURAL HISTORY
Square, Inc. is a business headquartered in San Francisco, California. It provides services
that allow merchants (referred to as “sellers”) to accept card payments from their customers.
(Declaration of Brian Reynoso in Support of Motion to Grant Petition to Confirm (“Reynoso
Decl.”), para 3.) Square Capital is a wholly owned subsidiary of Square, Inc. that facilitates
business financing to sellers, many of whom use Square, Inc.’s payment facilitation services. (/d.
at para. 2,4.) Business loans offered through the Square Capital program are issued by Celtic
Bank Corporation, a Utah-chartered Industrial Bank. (/d. at para. 5.) For the type of loan at issue
in this case, Square Capital, as loan servicer, applies a pre-determined percentage of a seller’s
daily card sales through Square, Inc. to repay the outstanding loan balance. (/d.)
According to California Secretary of State filings, Respondents are business entities
operated by Samer Kiresh and/or Majdi Kiresh, located and doing business in San Francisco,
California. (See Reynoso Decl., Exs. 1 & 2.) Respondents operate restaurant and/or catering
businesses located at 221 Main Street, Ground Floor, San Francisco, California 94105. (/d., Exs.
1-3.)
On October 8, 2013, Mr. Kiresh opened an account with Square, Inc. under the business
name “Spread’z” to accept card payments. (Reynoso Decl., para. 13.) In doing so, Spread’z and
Square, Inc. both agreed to resolve all disputes relating to the account through binding arbitration,
and further agreed to the AAA conducting such binding arbitration. (Reynoso Decl., para. 13, Ex.
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO GRANT PETITION TO
CONFIRM ARBITRATION AWARDCo ON Dn FW YY
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4, para. 51.)
After Mr. Kiresh opened a Square, Inc. account on behalf of Spread’z in 2013, he then
used this account to acquire a loan through Square Capital on behalf of his associated business
entity, Platters Catering, on December 30, 2016. (Reynoso Decl., para. 16.) Mr. Kiresh listed the
name of the business as “Platters Catering,” but the loan would be repaid through payments
accepted on his existing “Spread’z” Square, Inc. account. (/d.) Through this loan, Respondents
Platters and Spread’z borrowed a total amount of $85,250 through Square Capital ($77,500 loan
amount plus $7,250 fee). (/d., Ex. 5.)
The terms of this loan were set forth in detail in a written loan agreement containing a
mandatory and binding arbitration provision. (/d., para. 7.14.) Specifically, the parties to the loan
agreed to arbitrate “all disputes arising under or in connection with this Agreement.” (/d.) They
agreed further that “[a]ll disputes shall be resolved finally and exclusively by binding individual
arbitration with a single arbitrator administered by the American Arbitration Association.” (/d.)
The loan was not repaid as required. While Respondents obtained the subject loan in
December of 2016, they repaid only a small portion of the loan, failing to make any payments at
all since January 27, 2017. (Reynoso Decl., para. 17.) A remaining loan balance of $80,513.89
therefore exists. (/d.)
Following Respondents’ default, Square Capital initiated arbitration proceedings through
the AAA. (Declaration of Claire Molesworth in Support of Motion to Grant Petition to Confirm
Arbitration Award (“Molesworth Decl.”) Exs. 1 & 2.) An arbitration hearing date was scheduled,
evidence was presented, and hearings were conducted at which the arbitrator considered written
and oral evidence and argument. (Molesworth Decl., paras., 3-5.) On April 6, 2018 arbitrator
Carol J. Marshall entered a final Arbitration Award in favor of Square Capital and against
Respondents Spread’z and Platters jointly and severally in the amount of $86,313.89.
(Molesworth Decl., Ex. 3.) This award included the entire unpaid loan balance of $80,513.89, as
well as an award of costs and fees totaling $5,800, which Square Capital had to incur in order to
bring the arbitration proceeding. (/d.)
Respondents were served with the Arbitration Award on by personal delivery on
2.
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO GRANT PETITION TO
CONFIRM ARBITRATION AWARDCo ON Dn FW YY
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September 5, 2018, and thereafter by depositing the Award in the U.S. Mail on October 16, 2018.
(Molesworth Decl., para. 8-10; Ex. 5, 6 & 7.). More than 100 days have elapsed since Square
Capital served Respondents with the Arbitration Award.
LEGAL ARGUMENT
A. This Court is Authorized to Enter Judgment Confirming Arbitration Award
on Square’s Petition.
Petitioner Square Capital petitions this Court to confirm the award pursuant to California
Code of Civil Procedure Section 1285 and to enter judgment in conformity therewith pursuant to
California Code of Civil Procedure Section 1287.4, The California Code of Civil Procedure
provides for the confirmation of arbitral awards through petition to the Superior Court. "Any
party to an arbitration in which an award has been made may petition the court to confirm...the
award." (Cal. Code Civ. Proc. § 1285.) The requirements of such a petition are that the petitioner:
(a) Set forth the substance of or have attached a copy of the agreement to
arbitrate unless the petitioner denies the existence of such an agreement.
(b) Set forth the names of the arbitrators. (c) Set forth or have attached a
copy of the award and the written opinion of the arbitrators, if any.
(Cal. Civ. Proc. Code § 1285.4.)
Upon receiving a properly filed petition to confirm an award, the Superior Court is
generally required to confirm it as a judgment. "Ifa petition or response under this chapter is duly
served and filed, the court shall confirm the award as made, whether rendered in this state or
another state, unless in accordance with this chapter it corrects the award and confirms it as
corrected, vacates the award or dismisses the proceeding." (Cal. Code Civ. Proc. § 1286.)
As California courts have emphasized, “the Legislature's use of the word ‘shall’ in the
statutory provisions ... makes them mandatory, not precatory.” (Louise Gardens of Encino
Homeowners’ Assn., Inc. v. Truck Ins. Exch., Inc. (2000) 82 Cal. App. 4th 648, 658.) “Unless a
statutory basis for vacating or correcting an award exists, a reviewing court shall confirm the
award as made.” (Corona v. Amherst Partners (2003) 107 Cal. App. 4th 701, 706.) As the
California Supreme Court has noted, “courts will not review the validity of the arbitrator's
reasoning.” (Moncharsh v. Heily & Blase (1992) 3 Cal. 4th 1, 11.) Nor may a court “review the
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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO GRANT PETITION TO
CONFIRM ARBITRATION AWARDCo ON Dn FW YY
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sufficiency of the evidence supporting an arbitrator's award.” (/d.)
Such a confirmed judgment following an arbitration award “has the same force and effect
as, and is subject to all the provisions of law relating to, a judgment in a civil action...and it may
be enforced like any other judgment of the court in which it is entered." (Cal. Code Civ. Proc. §
1287.4.)
The California Code of Civil Procedure expressly sets forth a streamlined process for the
confirmation of judgments following arbitration awards. "A petition under this title shall be heard
in a summary way in the manner and upon the notice provided by law for the making and hearing
of motions, except that not less than 10 days' notice of the date set for the hearing on the petition
shall be given." (Cal. Code Civ. Proc. § 1290.2.)
B. Square is Entitled Judgment in the Amount of $86,313.89 against
Respondents.
As noted above, in the absence of a specific statutory basis to vacate or amend an
arbitration award, this Court is required to enter judgment in favor of a petitioner following a
properly entered and served award. (Cal. Code Civ. Proc. § 1286; Corona, 107 Cal. App. 4th at
706; Moncharsh, 3 Cal. 4th at 11.) Here, no statutory grounds exist for vacating or amending the
award.
All the requirements of Code of Civil Procedure Section 1285.4 have been satisfied. (See
generally Cal. Code Civ. Proc. § 1285.4.) Both Respondents entered into written agreements
through which they agreed to resolve any disputes concerning the account and loan through
binding arbitration. (Reynoso Decl., Exs. 4 & 5.) Subsequently, this matter was duly presented
for arbitration to arbitration Carol J. Marshall of the AAA, and the AAA entered an arbitration
award in favor of Square Capital and against both Respondents jointly and severally in the amount
of $86,313.89. (Molesworth Decl., Ex. 3.) Square Capital has provided copies of the agreements
to arbitrate, the name of the arbitrator, and a copy of the final award to be confirmed, as required.
Further, this petition has been timely brought as provided for pursuant to Code of Civil
Procedure § 1290.2. As set forth in the Proof of Service filed herewith, the notice of hearing, the
Petition, and the supporting papers have been served in accordance with Code of Civil Procedure §
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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO GRANT PETITION TO
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1290.4, giving at least 10 days’ notice of the date set for hearing on the Petition. (See Square
Capital Proof of Service.)
Moreover, more than 100 days have elapsed since the Arbitration Award was served on
Respondents. (Cal. Civ. Proc. Code §§ 1290.4(b)(1), 415.95, 415.20(b); Molesworth Decl., Exs.
5,6 & 7.) Because Respondent failed to file a petition to vacate or correct the arbitration award no
later than 100 days after service of the award, any response to this petition that asserts grounds to
vacate the award must be disregarded. (Eternity Investments, Inc. v. Brown (2007) 151 Cal.
App.4th 739.)
Accordingly, Square Capital requests that this Court confirm the AAA’s award providing
for monetary judgment in its favor and against Respondents in the amount of $86,313.89, along
with statutory interest on the judgment.
CONCLUSION
For the foregoing reasons Petitioner Square Capital, LLC respectfully requests that this
Court confirm the arbitration award rendered on April 6, 2018, and to enter Judgment in
accordance therewith.
DATED: April 12, 2019 Respectfully submitted,
SQUARE CAPITAL, LLC
By: /s/ Claire L. Molesworth
Claire L. Molesworth, #309100
Attorney for Petitioner SQUARE CAPITAL, LLC
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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO GRANT PETITION TO
CONFIRM ARBITRATION AWARD