Stockton Unified School Dist. v. IAQ Distribution CA3

BACKGROUND

According to the allegations in the underlying complaint, in August 2021, IAQ and plaintiff Stockton Unified School District (the District) entered into a written agreement pursuant to which the District would purchase 2,000 “Air Guardian” air purification units, with installation, from IAQ for approximately $6.8 million. The agreement contained an arbitration provision that stated, in relevant part:

“Written notice of any dispute must be provided to the other party, describing specific details of the dispute relating to changes in work or claim for additional compensation, within seven (7) days of the occurrence of the conditions. . . . If the parties are unable to resolve the dispute during this period, the parties shall proceed to binding arbitration. The arbitrator shall . . . determine all rights and obligations under this Agreement and the award of the arbitrator shall be final, binding and enforceable.”

The District alleges it agreed to purchase the units based on representations they would disinfect classroom air and kill COVID-19. The representations were made by IAQ, ABS, and IllumiPure Inc. and IllumiPure Corp. (IllumniPure). IAQ and ABS are related…