Unreported / Non-Citable
Background
Luis de Lecea, a professor who alleged that he invented a device for treating sleep disorders, sued his former associates, Attune Neurosciences, Inc. and its chief executive officer, Rajiv Mahadevan. His operative pleading alleged trespass to chattels, conversion, negligence, breach of fiduciary duty, and fraud arising from his termination and Attune’s asserted clawback of company shares. He sought damages and other relief. The complaint’s exhibits included a founder stock purchase agreement without an arbitration provision, a restricted-stock grant notice, and an unsigned independent-contractor agreement that also lacked an arbitration provision.
In April 2025, the defendants moved to compel arbitration under a different document, a Stock Restriction Agreement, or SRA. Mahadevan supplied an unsigned copy containing an arbitration clause, together with a stand-alone, undated DocuSign signature page that did not reference a specific agreement. De Lecea declared that during an urgent investment closing the DocuSign packet contained only copies of signature pages and the documents were not attached in full, so he did not know what those pages belonged to. He said he thought he was signing a different restricted-stock agreement and would not have accepted the SRA’s terms. The defendants answered that he participated in negotiations and later requested and quoted the SRA.
The Court’s Holding
The Court of Appeal affirmed the San Mateo County Superior Court’s denial of the motion. The motion was heard on August 15, 2025; after the matter was submitted, the trial court adopted its tentative ruling and denied the motion. The appellate court explained that the dispositive question was whether an arbitration agreement existed, not how an undisputed agreement should be interpreted. Under the three-step process in Iyere, the defendants initially produced an agreement containing an arbitration clause, but de Lecea’s declaration created a factual dispute about whether he had agreed to that document. The burden therefore returned to the defendants to prove the agreement by a preponderance of the evidence.
Substantial evidence supported the trial court’s conclusion that they did not meet that burden. Their evidence consisted of an unsigned SRA and a generic signature page, while de Lecea’s account contradicted and impeached their assertion that he signed the SRA. Mahadevan’s general statement about negotiations did not show that de Lecea received or accepted the arbitration provision, and sending the SRA to counsel in 2022 did not establish what de Lecea possessed when he used DocuSign in April 2021. References to stock repurchases in the complaints likewise did not acknowledge the particular SRA or its arbitration language.
The opinion states that denial of a motion to compel arbitration is reviewed for abuse of discretion except for pure questions of law, and that a decision based on a factual finding is reviewed for substantial evidence. Because the ruling rested on the failure to prove the existence of an arbitration agreement, the court asked whether defendants’ evidence was uncontradicted, unimpeached, and of such weight that no judicial determination of insufficiency could be made. It held they had not overcome the presumption favoring the order. It expressly declined to decide whether the purported arbitration clause was unconscionable, explaining that unconscionability matters only if a valid agreement exists. It also noted that plaintiff may be barred in the future from invoking the SRA, but that issue was not before the trial court and was not considered. The order was affirmed, with appellate costs awarded to de Lecea.
Key Takeaways
- A party seeking arbitration must prove the agreement’s existence by a preponderance of the evidence once the opposing party identifies a genuine factual dispute.
- An unsigned contract paired with a generic electronic signature page may not establish that the signer assented to that particular contract or its arbitration clause.
- Evidence that a person participated in negotiations or received an agreement after signing does not necessarily prove earlier assent to arbitration.
- A fact-based denial of arbitration is reviewed for substantial evidence, and the appellant must overcome the presumption that the order is correct.
- The affirmance did not decide unconscionability or whether de Lecea could invoke the SRA in future proceedings.
Why It Matters
The decision applies California’s arbitration burden-shifting framework to a fragmented electronic-signing record. It distinguishes proof that a signature page was completed from proof that the signer agreed to the substantive document containing an arbitration clause. The ruling also shows why later familiarity with a contract does not necessarily resolve what was presented at formation.
The affirmance keeps de Lecea’s claims in court rather than compelling arbitration on this record. It does not determine the merits of his claims, invalidate every possible use of the SRA, or resolve the defendants’ unconscionability arguments.