Acquire II, Ltd. v. Colton Real Estate Group

Plaintiffs and respondents 1 invested in six investment funds defendants and appellants 2 created over a 10-year period to purchase and manage six portfolios of commercial real estate. Each fund was separate from the other funds and presented two distinct investment options. Investors could become members or partners in the entity that held title to the entire portfolio or investors could purchase fractional ownership interests in a specific property included in the portfolio without becoming members or partners in the entity. Some Plaintiffs became members in one or more of the investment funds, some became joint owners of one or more individual properties, and some did both.

Defendants filed six motions seeking to compel six of the 12 groups of Plaintiffs to arbitrate their claims relating to these investments. Defendants could not compel all Plaintiffs to arbitrate their claims because Defendants failed to include arbitration provisions in the governing documents for each investment option in each fund. Based on Code of Civil Procedure section *964 1281.2, subdivision (c), 3 the trial court denied all six motions because requiring some Plaintiffs to pursue their…