1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 EMPROS CAPITAL LLC, Case No. 3:20-cv-06788-WHO

8 Plaintiff,

ORDER ON PRELIMINARY

9 v. INJUNCTION; ADMINISTRATIVE

MOTIONS TO SEAL

10 GARY ROSENBACH, Re: Dkt. Nos. 2, 6, 10, 11 Defendant. 11

12 Plaintiff Empros Capital LLC (“Empros”) moves for a preliminary injunction to enjoin an 13 arbitration commenced against it by defendant Gary Rosenbach. Rosenbach contends that the 14 parties agreed to a sale of stocks that Empros is not honoring. Empros argues that no contract, 15 including an agreement to arbitrate, was ever formed. I agree with Empros that, on this record, the 16 parties never agreed to arbitrate, so it has shown a likelihood of success on the merits. But since 17 the arbitration has now been withdrawn, there is no threat of irreparable injury. The motion is 18 DENIED.1 19 BACKGROUND 20 The facts at this stage are drawn from Empros’s verified complaint and other materials 21 supported by sworn declaration submitted by the parties. 22 Empros is a venture capital firm incorporated under California law. Verified Complaint 23

24 1 After I made clear during oral argument that, based on the record before me, defendant had not shown that any contract existed, let alone an agreement to arbitrate, defense counsel indicated that 25 he would withdraw the arbitration and file a lawsuit in state court. He asked that I not issue any written order. I expect that there will be future litigation over whether this or another court is the 26 appropriate forum for the parties’ dispute, so it seems appropriate to articulate the basis for my ruling on the motion before me. Rosenbach argued in his notice of withdrawal of the arbitration 27 that the motion for a preliminary injunction was now moot. The withdrawal, however, came about 1 (“Compl.”) [Dkt. No. 1] ¶¶ 11, 18. Empros is owned by Alex Fishman who is domiciled in San 2 Francisco, California. Id. ¶ 11. It is the “sponsor” of the Empros Enterprise Data Technologies 3 Fund II, LLC (the “Fund”), a private investment fund that “permits its investors to gain exposure 4 to shares of” Palantir Technologies (“Palantir”). Id. ¶ 4, 18. Rosenbach is an investor who, 5 according to the Complaint, is a resident of Colorado. Id. ¶¶ 12, 16. 6 On June 9, 2020, Rosenbach’s broker-dealer Matt Weisbarth “contact[ed] Fishman to 7 inquire about investing $1–2 million in the Fund.” Id. ¶ 20; see Compl. Ex A [Dkt. No. 1-1] at 3. 8 He did not initially identify the buyer as Rosenbach. Compl. Ex. A at 1–3. After Weisbarth’s first 9 email, Fishman responded, “Yes sure. Free to connect tonight?” Id. at 3. On June 10, Weisbarth 10 wrote that “the $2 mill guy” would invest. Id. at 3. He laid out how many shares the investor 11 would buy, at what price, and the details involved in splitting the origination fee. Id. He said, 12 “Let me know if that’s correct and then let me know how my back office should paper this one 13 up.” Id. Fishman responded several hours later: “Terrific.” Id. He asked for the investment 14 vehicle’s name and the investor’s email address and said Empros would “send him a link with 15 closing details . . . and wiring instructions.” Id. In response to a follow-up email, Fishman also 16 wrote “[w]e need to get this funded by Friday,” an Empros employee “will be able to send out 17 docs a few hours after we have info,” and he was “[l]ooking forward to closing and having one 18 done with you.” Id. at 1; Compl. ¶ 21. Weisbarth wrote back that “[t]he buyer is Gary 19 Rosenbach.” Compl. Ex. A at 1. 20 Later on June 10, the Empros employee sent Rosenbach the email. Compl. Ex. B [Dkt. 21 No. 1-2]. It began, “Good evening, we are thrilled to have you be a part of our fund.” Id. at 2. It 22 stated that the email “included our confidential fund documents . . . for your review and 23 signature.” Id. It identified four documents. The first was the “Private Placement 24 Memorandum,” which, the email said, “is for your information as the subscriber to the fund and 25 does not require a signature.” Id. Second, the “Operating Agreement . . . [e]xplain[ed] the terms 26 of the fund”; the email said it “governs all investors in the fund and will be executed, by the 27 Sponsor (Empros Capital), the Manager (Assure Services, our 3rd Party Manager), and you as a 1 subscription to the fund and covers some of our KYC/AML [Know your Client/Anti-Money 2 Laundering] required documentation.” Id.; Compl. ¶ 23. Fourth, the “Certification of 3 Designation” discussed the “specifics of [Rosenbach’s] investment.” Compl. Ex. B at 2. The 4 Empros employee explained that she had “prepared electronic signature packages for each of the 5 entities that will be investing.” Id. The email then said, “Please click below to execute on behalf 6 of each entity” that would be investing on Rosenbach’s behalf and included a hyperlink for each. 7 Id.; see also Compl. ¶ 21 (discussing the three entities). The email also discussed wiring Empros 8 money and stated, “please let us know when the wires have been intiated [sic] so we can promptly 9 confirm receipt. Its [sic] critical that we receive your wire by Monday June 15th, so please be sure 10 to initiate it by Friday June 12th.” Compl. Ex. B at 2–3. Finally, the last item in the email, below 11 the employee’s signature block, was a hyperlink to an “Email Disclaimer.” Id. at 3. The 12 hyperlink opened a page on the website of Empros’s broker-dealer that stated, among other things,

13 This material may not be suitable for all investors and is not intended to be, nor shall it be construed as legal, tax or investment advice or as an offer, or the solicitation of any offer, 14 to buy or sell any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. Any such offer or solicitation 15 may only be made by means of delivery of an approved confidential offering 16 memorandum. Any other information provided herein is for informational purposes only and should not be deemed as a recommendation to buy or sell securities. 17 Id. at 4; Compl. ¶ 24. 18 The Private Placement Memorandum, Operating Agreement, Subscription Agreement, and 19 Certificate of Designation (collectively, the “Fund Documents”) contain language that Empros 20 contends shows that no contract can be formed until all parties sign and that it had the ability to 21 reject Rosenbach and terminate the transaction at any time. See Compl. ¶¶ 38–50. The current 22 dispute centers on this language, which I discuss in detail below. Rosenbach executed (via 23 electronic signature) the three Fund Documents that required his signature and returned them to 24 Empros on June 11. Compl. ¶ 58. He then wired the required funds from two of his investment 25 vehicles but not from his personal IRA the next day, June 12. Id. 26 Empros alleges that “[o]ver the weekend of June 13 and 14,” it “reviewed the information 27 provided by Rosenbach and realized that Rosenbach was the same Rosenbach who had co- 1 founded Galleon, [a] hedge fund that buckled under an insider trading investigation and 2 prosecutions.” Id. ¶ 59. Additionally, Empros alleges that it learned that “Rosenbach had 3 disclosed his prospective investment, as well as the pricing terms the parties had discussed, to one 4 of Empros’s most significant competitors.” Id. ¶ 60. That disclosure, Empros alleges, “violated 5 the confidentiality provisions in the [Fund] Documents.” Id. Empros also claims that, 6 confidentiality provisions aside, “any seasoned investor like Rosenbach would have known that 7 this information was to be kept confidential.” Id. 8 On June 14, Weisbarth sent Fishman an email that Empros characterizes as “attempting to 9 salvage the deal.” Id. ¶ 61. The Complaint is silent about any communications that happened 10 between Empros’s alleged discovery of the negative information about Rosenbach and this email. 11 It does not state, for instance, what communications occurred between the parties—if any—that 12 indicated the deal might not go through. Weisbarth’s June 14 email references confusion by one 13 of Rosenbach’s employees about his investment in Palantir via Empros and a separate investment 14 in Palantir via a different firm. See Compl. Ex. R [Dkt. No. 1-18] at 2. According to Weisbarth, 15 Rosenbach’s assistant “got confused” between the documents from each firm and “questioned the 16 price” of the Empros investment as a result. Id. The email stated that it was an “honest mistake” 17 and that Rosenbach “still obviously want[s] to move forward with you [sic] trade. I explained to 18 him that was 100% up to you.” Id. That evening, Rosenbach wrote to Fishman, “Sorry about the 19 confusion today. My assistant made a mistake and sent an email on a deal that I closed last week 20 with another group. He got confused on the pricing and sent the email by mistake to you plus the 21 wrong group. I look forward to moving forward on this deal and hopefully more in the future.” 22 Compl. Ex. S. [Dkt. No. 1-19] at 2. 23 Empros claims that it “informed Rosenbach of its decision to reject Rosenbach’s request to 24 invest in the Fund” on June 15. Compl. ¶ 63. It alleges that neither it nor the Fund’s manager 25 executed any of the Fund Documents that required their signature. Id. It also asserts that other 26 steps necessary to consummate investment in the Fund were not completed, including placing 27 Rosenbach or his investment entities in the Fund’s “Interest Register” or executing an 1 picture of the parties’ interactions. Empros does not state by what means it “informed” Rosenbach 2 of the decision and includes no exhibit, such as an email or text message. A series of text 3 messages between Fishman and Weisbarth on June 15 show the situation gradually deteriorating. 4 See Compl. Ex. U [Dkt. No. 1-21]. In the morning, Weisbarth asked Fishman “What are ur 5 thoughts. I need to call Gary soon.” Id. at 5. Over the next several hours, Weisbarth sent 6 Fishman a series of messages repeatedly asking for updates and for Fishman to contact 7 Rosenbach. Id. at 5–6. Fishman repeatedly responded he would get back to Weisbarth and 8 Rosenbach. Id. Over the day, Weisbarth said that Rosenbach was getting more and more upset at 9 the lack of response. In a conversation that began at 8:51 am, Weisbarth wrote that Rosenbach 10 was “ok with you not wanting to do the trade with him. He just needs to know.” Id. at 6. At 1:50 11 pm Weisbarth said Rosenbach “is losing patience slowly.” Id. At 2:27 pm, Fishman emailed 12 Empros’s bank and requested that it return the wires from the Rosenbach entities. Compl. Ex. T 13 [Dkt. No. 1-20] at 3. Later, after 4:00 pm, Weisbarth said that Rosenbach was “so mad.” Id. 14 Finally, in the evening, the two agreed they would call Rosenbach together and, the next morning 15 (June 16), Weisbarth texted to ask what time Fishman wanted to do that call. Id. at 7–8. 16 On June 19, it appears that Fishman was still trying to find a way to have Rosenbach invest 17 in Palantir. See id. at 8–10 (writing on June 19 that Fishman “may still be able to get [Rosenbach] 18 . . . In”). The Complaint characterizes these efforts as coming from “concern[] about the 19 ramifications of” not “accommodate[ing] a powerful investor.” Compl. ¶ 65. On July 2, 2020, 20 Fishman wrote, “Ok, I actually have something for him” and “Not quite what he wants but 21 something.” Id. at 9. Soon after, Weisbarth said, “Just spoke to [Rosenbach]. He’s very excited. 22 Thank u Alex. Just curious how u can get it at this price ?!!” Id. at 9. But, by July 6, Weisbarth 23 wrote, “Alex, Gary is not someone to mess with. This is not going in the right direction. I can 24 [sic] stress enough that you need to communicate with him.” Id. at 10. And, on July 7, 25 Rosenbach himself sent Fishman a string of messages including “Big mistake,” “Your word is 26 supposed to be your bond it’s a shame in my entire career I have never faced anything or anyone 27 like you,” and that the money wired to Empros “sure sounds like acceptance.” Compl. Ex. V 1 On September 8, 2020, Rosenbach initiated an arbitration proceeding against Empros, 2 claiming it violated their contract. Compl. ¶ 68. Empros was notified of the arbitration on 3 September 15. Id. On the day of its deadline to respond to the arbitration, September 29, Empros 4 filed suit in this Court seeking declaratory and injunctive relief against the arbitration. See id. The 5 next day, it moved for a temporary restraining order (“TRO”) halting the arbitration. See Ex Parte 6 Motion and Motion for Temporary Restraining Order and Order to Show Cause re Preliminary 7 Injunction [Dkt. No. 10]. Prior to the hearing on the TRO, counsel indicated that the American 8 Arbitration Association (“AAA”) had placed the arbitration in abeyance at the parties’ request. 9 See Dkt. No. 19. Because of this, there was no need to proceed on an expedited basis and I 10 determined that I would treat the motion for a TRO as a motion for a preliminary injunction that 11 could proceed according to a normal briefing schedule. Id. Both parties have now fully briefed 12 the issue. I held a hearing on the motion on November 10, 2020. At that hearing, I indicated that I 13 was likely to find for Empros on the likelihood of success on the merits. Rosenbach’s counsel 14 indicated that he planned to withdraw the arbitration and file a case in state court. Counsel has 15 communicated to me since then that the arbitration has been withdrawn. 16 LEGAL STANDARD 17 Federal Rule of Civil Procedure 65 governs preliminary injunctions. A preliminary 18 injunction may be issued if a plaintiff establishes: (1) likelihood of success on the merits; (2) 19 likelihood of irreparable harm in the absence of preliminary relief; (3) that the balance of equities 20 tips in his favor; and (4) that an injunction is in the public interest. See Winter v. Natural Res. Def. 21 Council, Inc., 555 U.S. 7, 20 (2008). “Injunctive relief [is] an extraordinary remedy that may only 22 be awarded upon a clear showing that the plaintiff is entitled to such relief.” Id. at 22. The Ninth 23 Circuit has held that “‘serious questions going to the merits’ and a hardship balance that tips 24 sharply toward the plaintiff can support issuance of an injunction, assuming the other two 25 elements of the Winter test are also met.” See Alliance for the Wild Rockies v. Cottrell, 632 F.3d 26 1127, 1132 (9th Cir. 2011). 27 1 DISCUSSION 2 I. PRELIMINARY INJUNCTION 3 Empros has shown a likelihood of success on the merits of its claim: On this record, it is 4 clear that the parties never mutually assented to the alleged arbitration agreement. But Empros has 5 not shown that it faces a likelihood of irreparable injury because the arbitration it challenges was 6 held in abeyance and is now withdrawn. 7 A. Likelihood of Success on the Merits 8 Empros argues it is likely to succeed on the merits of its claim that there is no contract that 9 compels it and Rosenbach to arbitrate. See generally Memorandum of Points and Authorities in 10 Support of Empros’s Motion (“Mem.”). I agree; on this record, no arbitration agreement was 11 mutually assented to. 12 “It is a settled principle of law that arbitration is a matter of contract.” Ingle v. Circuit City 13 Stores, Inc., 328 F.3d 1165, 1170 (9th Cir. 2003) (internal quotation marks omitted). As such, “a 14 party cannot be required to submit to arbitration any dispute which he has not agreed so to 15 submit.” AT&T Techs., Inc. v. Commc’ns Workers of Am., 475 U.S. 643, 648 (1986) (internal 16 quotation marks and citation omitted). To determine whether an arbitration agreement exists, 17 federal courts apply ordinary state contract law. Nguyen v. Barnes & Noble Inc., 763 F.3d 1171, 18 1175 (9th Cir. 2014). 19 The parties generally apply the law of California, where Empros is incorporated and 20 apparently operates from. See, e.g., Mem. 11; Opposition to the Motion for Preliminary 21 Injunction (“Oppo.”) [Dkt. No. 27] 15. Empros admits that the law of Colorado (Rosenbach’s 22 state of residence) might theoretically apply, see Mem. 13 n.2; Rosenbach says it may be 23 California, Colorado, or New York (the latter for reasons he does not explain), see Oppo. 14 n.14. 24 Empros also asserts that Delaware law would apply if a contract had in fact been formed. Mem. 25 13 n.2. As I explain, however, this dispute involves an issue of the most fundamental contractual 26 question: whether there was mutual assent to a contract. The parties have not pointed to any 27 salient difference in these states’ laws that would—especially at the preliminary-injunction 1 Cal. 4th 95, 107–08 (2006) (determination of the choice of law is only necessary when there is a 2 difference between the laws that creates a “true conflict”). Taking the parties’ lead, I often rely on 3 cases applying California law, but note the agreement of the laws of those other states and general 4 principles of contract law. 5 1. The Parties Never Formed a Contract 6 A valid contract requires the “mutual consent of the parties,” which is “generally achieved 7 through the process of offer and acceptance.” DeLeon v. Verizon Wireless, LLC, 207 Cal. App. 8 4th 800, 813 (2012) (internal citations omitted). Whether such consent occurred is determined 9 under an objective standard based on the parties’ “outward manifestations or expressions” and 10 “the reasonable meaning of their words and acts, and not their unexpressed intentions or 11 understandings.” Id.2 Whether a certain set of facts establishes a contract is a question of law. 12 Long v. Provide Commerce, Inc., 245 Cal. App. 4th 855, 863 (2016). 13 The only possible way the parties here would have consented to arbitrate is if their dealings 14 created a contract. The question is therefore whether the parties’ words and acts, reasonably 15 understood, show mutual assent to be bound. On the record as it has been presented to me, no 16 contract was formed, let alone a valid agreement to arbitrate. 17 “When it is clear, both from a provision that the proposed written contract would become 18 operative only when signed by the parties as well as from any other evidence presented by the 19 parties that both parties contemplated that acceptance of the contract’s terms would be signified by 20 signing it, the failure to sign the agreement means no binding contract was created.” Banner 21 Entm’t, Inc. v. Superior Court (Alchemy Filmworks, Inc.), 62 Cal. App. 4th 348, 358 (1998), as 22 modified (Mar. 30, 1998). But if the “parties orally agreed upon all of the terms and conditions of 23 a proposed written agreement with the mutual intention that the oral agreement should thereupon 24 become binding, the mere fact that a formal written agreement to the same effect has not yet been 25 signed does not alter the binding validity of the oral agreement.” Id. As always, the touchstone is 26 2 Accord Restatement (Second) of Contracts §§ 3, 18; PayoutOne v. Coral Mortg. Bankers, 602 F. 27 Supp. 2d 1219, 1224 (D. Colo. 2009); Crum v. April Corp., 62 P.3d 1039, 1040–41 (Colo. App. 1 the parties’ intent. Parties can intend—as objectively understood through their words and acts— 2 that a contract be binding only upon formal execution, or they can intend that formal execution is 3 not required to be bound. See id.; see also First Nat. Mortg. Co. v. Fed. Realty Inv. Tr., 631 F.3d 4 1058, 1065 (9th Cir. 2011) (“Where there is a manifest intention that the formal agreement is not 5 to be complete until reduced to a formal writing to be executed, there is no binding contract until 6 this is done.” (internal quotation marks and alterations omitted)). Courts have consistently applied 7 this framework to determine whether parties intended to require formal execution or not. See, e.g., 8 Jafari v. F.D.I.C., No. 12CV2982, 2015 WL 3604443, at *6 (S.D. Cal. June 8, 2015); Atlantique 9 Prods., S.A. v. Ion Media Networks, Inc., No. CV128632, 2014 WL 11820243, at *5 (C.D. Cal. 10 Jan. 31, 2014), aff’d, 644 F. App’x 800 (9th Cir. 2016).3 11 The Fund Documents that formed the core of the putative contract were clear about what 12 would be required for a binding contract to be formed. The Operating Agreement provided that, 13 “The Manager (with the prior approval of the Sponsor [Empros]) may admit any Person as a 14 Member upon signing a counterpart of this Agreement.” See Compl. Ex. D at 9. At the bottom, it 15 included signature lines for Rosenbach, Empros, and the Manager of the Fund. Id. at ECF 42–43. 16 The Subscription Agreement provided that Rosenbach “shall be admitted as a Member in the Fund 17 (“Member”) at the time this Subscription is accepted and executed by the Manager.” See Compl. 18 Ex. E at 2 (emphasis added). It further stated that it was “effective as of the date set forth above 19 the Manager’s signature on the Acceptance of Subscription page of this Agreement.” Id. To drive 20 the point home, yet another section provided

21 The Manager, on behalf of the Fund, subject to the approval of the Sponsor, may accept or reject this Subscription, in whole or in part, in its sole discretion, subject to the approval of 22 the Sponsor. This Subscription shall be deemed to be accepted by the Manager and this Agreement shall be binding against the Manager only upon execution and delivery to the 23 Subscriber of the Acceptance of Subscription attached hereto. 24 Id. (emphasis added). And it included a signature line for the Fund’s manager preceded by the 25 statement that, “By signing below, the Fund hereby accepts Subscriber’s subscription for Interests 26 3 Accord Restatement (Second) of Contracts § 27 & comm. a–b.; Mohler v. Park Cty. Sch. Dist. 27 RE-2, 515 P.2d 112, 114 (Colo. App. 1973); Ellis Canning Co. v. Bernstein, 348 F. Supp. 1212, 1 in the Fund in the amount indicated on the Signature Page to Subscription Agreement.” Id. at 16. 2 It is evident from these repeated statements across two of the three documents that required 3 signature that the parties intended any contract to be complete only upon proper execution through 4 signing. See, e.g., Jafari, 2015 WL 3604443, at *6 (“The . . . letter states ‘[t]his letter shall not be 5 binding upon, or effective against, any party signing a counterpart unless and until all parties have 6 signed counterparts.’ It’s undisputed that ALB never signed the letter. In the context of the 7 document as a whole it’s difficult to conclude that the quoted sentence means anything other than 8 what it plainly says: that the agreement is not binding until all parties have signed.” (some internal 9 quotation marks and alterations omitted)); Atlantique, 2014 WL 11820243, at *5 (“Here, the 10 uncontroverted facts demonstrate that the understanding between the parties in negotiating the 11 agreement was that the term sheet had to be signed by both parties in order to be valid.”). 12 Rosenbach does not dispute that the Fund Documents were given to him unsigned and that the 13 required parties on Empros’s side never executed them. A reasonable person would understand 14 that no contract was operative until the documents were fully executed. 15 Other provisions of the Fund Documents reinforce this conclusion. See First Nat. Mortg., 16 631 F.3d at 1065 (“In the absence of ambiguity [whether formal execution is required] must be 17 determined by a construction of the instrument taken as a whole.”). By their plain language, the 18 Fund Documents permitted Empros to reject Rosenbach even after he signed the documents and 19 wired the requisite funds. They stated, for instance, that Empros “reserves the right to accept or 20 reject any subscription, in whole or in part.” Compl. Ex. C at 4; see also id. at 34 (“The Sponsor 21 may accept or reject any subscription in whole or in part, in its sole discretion, for any reason 22 whatsoever, and to withdraw the Offering at any time. In the event the Sponsor refuses to accept a 23 Subscriber’s subscription, any subscription funds received will be returned without interest.”). 24 Accordingly, on these facts, the requirement of formal execution was not a mere formality; it 25 served a substantive, important purpose to the parties. 26 The requirement of formal execution makes particular sense in light of the complexity of 27 the transaction. Despite the informal nature of some of the parties’ (or their agents’) 1 money governed by dense, lengthy provisions. The Fund Documents are dozens of pages long, 2 highly detailed, and clearly intended to occur between sophisticated parties. The parties’ 3 communications show large sums of money being bargained over and decisions being made at 4 high speeds. It is natural that, in this environment, Empros would retain the ability to reject 5 Rosenbach, or any other potential investor. The requirement of formal execution ensured it 6 possessed this authority. It also removed uncertainty over whether a contract had been formed by 7 imposing a bright-line rule in the plain language of the contract. 8 In short, the Fund Documents repeatedly made explicit that the creation of a binding 9 agreement was contingent on execution via signature. They also were clear that there was a good 10 reason for this requirement: to retain Empros’s power to reject Rosenbach or other putative 11 subscribers. Accordingly, the parties’ intent, determined objectively through their actions, shows 12 that they never mutually assented to arbitrate. 13 2. Rosenbach’s Counterarguments are Unpersuasive 14 Rosenbach has several responses. Notably he does not contest that he was sent unsigned 15 versions of the Fund Documents, the relevant signatures never occurred, and Empros 16 communicated to him that it was rejecting him as an investor. 17 Rosenbach primarily argues that when “an agreement has been reached that governs all the 18 principal terms, a lack of signature on documents formalizing that agreement does not mean that 19 no contract was formed.” Oppo. 13. It is true that, as I have discussed, an agreement on all 20 material terms can result in formation of a contract despite a lack of formal signature. See Rennick 21 v. O.P.T.I.O.N. Care, Inc., 77 F.3d 309, 313–14 (9th Cir. 1996). But, as I have also discussed, that 22 is not so where, as here, the parties unambiguously demonstrate their intent that the contract be 23 predicated on formal execution. First Nat. Mortg., 631 F.3d at 1065. Both of the cases 24 Rosenbach relies on accord with these principles and neither concerned contracts whose express 25 provisions required formal execution to become effective. See Angell v. Rowlands, 85 Cal. App. 26 3d 536, 540–42 (1978); Brighton Inv., Ltd. v. Har-ZVI, 88 A.D.3d 1220, 1222–23 (N.Y. App. Div. 27 2011). Indeed, both explicitly embraced the framework I apply here. Angell explained that “a 1 parol or express condition, that the contract was not intended to be complete until all parties had 2 signed.” 85 Cal. App. At 542. Brighton held that the contract there was “ambigu[ous] as to 3 whether the parties intended to be bound . . . before it was formally signed” and cited a group of 4 cases holding that the determinative question is whether the parties intended the contract to be 5 valid only upon formal signature. 88 A.D.3d at 1223 (citing, e.g., Scheck, 260 N.E.2d at 493 (“It 6 is well settled that, if the parties to an agreement do not intend it to be binding upon them until it is 7 reduced to writing and signed by both of them, they are not bound and may not be held liable until 8 it has been written out and signed.”)). 9 Rosenbach relies on several specific pieces of evidence to attempt to demonstrate that, 10 contrary to the Fund Documents’ language, the parties intended to form a contract without formal 11 execution. 12 Rosenbach’s primary evidence is the June 10 email. Oppo. 14–16. As noted, that email 13 came from an Empros employee and included links to the Fund Documents for Rosenbach to sign. 14 Compl. Ex. B. Rosenbach points out that the email began, “Good evening, we are thrilled to have 15 you be a part of our fund.” Id. at 2. First, Rosenbach contends that this statement “itself can 16 constitute acceptance of the contracts at issue, and constitutes an email signature.” Oppo. 14. 17 More broadly, he argues that the June 10 email is evidence that the parties’ entire course of 18 dealings shows they intended to be bound. I disagree. To start, the remainder of the email directs 19 Rosenbach to the Fund Documents and, as explained, those documents repeatedly and explicitly 20 provide that no agreement will exist until they are signed by Empros and that Empros retained the 21 ability to reject Rosenbach. It is clear that, in context, this greeting was not reasonably intended to 22 signal finalization of the agreement that the remainder of the email contemplated. Additionally, 23 Rosenbach points to no authority for the proposition that a single form greeting (such as “we are 24 thrilled to have you be part of our fund”) can overcome the repeated, express provisions of the 25 comprehensive documents that lay out the material terms of the contract. 26 Even if that were not so, Rosenbach’s broader argument does not persuade. Not all 27 “material terms” had been agreed to by the point when the June 10 email was sent. Banner, 62 1 price; but the Fund Documents contain a web of numerous other provisions, many of which can 2 only be classified as material. Among many other issues that were unresolved when the June 10 3 email was sent—but would be resolved when all signatories signed the Fund Documents—are 4 what Rosenbach would have to submit to obtain Empros’s approval, or even whether Empros’s 5 approval would be required. Without the Fund Documents, moreover, there is no evidence the 6 parties intended to submit disagreements to arbitration; given Rosenbach’s invocation and 7 vigorous defense of the arbitrability of his claims, that choice may well be material. In all events, 8 there is no evidence on this record that there was mutual assent to all material terms and 9 conditions of the contract in any form except the Fund Documents.4 10 Rosenbach also argues that the June 10 email “makes clear that Empros will sign the 11 Operating Agreement, making the actual application of the signature an objectively pro forma 12 act.” Oppo. 14–15 (emphasis in original). The only portion of the email that arguably supports 13 this inference is the email’s statement that the Operating Agreement “governs all investors in the 14 fund and will be executed, by the Sponsor (Empros Capital), the Manager . . . , and you as a new 15 Member of the Fund.” Compl. Ex. B. If anything, however, this statement reinforces that 16 execution via signature is required. To the extent that Rosenbach’s argument is that the use of the 17 word “will” obligates Empros to sign, I reject it. In context, the statement that the documents 18 “will be executed” by various parties means that those are the signatures the document requires. 19 That is the only interpretation that aligns with plain language of the Fund Documents themselves. 20 The statement is synonymous with “the Operating Agreement needs to be executed by” the named 21 parties. In any event, as I have explained, the signature requirement is not, as Rosenbach argues, a 22 pro forma act: It effectuated Empros’s ability to reject investors, a power the Fund Documents are 23 explicitly concerned with preserving. 24 Rosenbach also points to a communication from Fishman to Pacific Premier Trust that he 25 characterizes as “represent[ing] . . . that Mr. Rosenbach had a new investment with Empros.” 26 4 Empros also relies on the hyperlink at the bottom of the email that, when clicked, led to the 27 disclaimer discussed above. There is no need to address the parties’ dispute over this disclaimer 1 Oppo. 15; see Declaration of Katherine M. Sullivan (“Sullivan Decl.”) [Dkt. No. 27-1] Ex. B. at 2 ECF 9–12. Rosenbach does not indicate what in that email he considers to be such a 3 representation. In any case, that email simply shows Fishman’s attempts to facilitate the 4 transaction; such facilitation only demonstrates preparation for the agreement to go through, not 5 that a contract had already been formed contrary to the Fund Documents’ plain language.5 6 Next, Rosenbach appears to contend that whether a contract was formed is itself an issue 7 for arbitration, not judicial determination, because the arbitration clause in the Subscription 8 Agreement “includes all disputes arising not only out of the Subscription Agreement, but also out 9 of Empros’s offering of the Fund Interest.” Oppo. 13; see also id. 17. He asserts that “the 10 arbitration clause itself explicitly contemplates arbitration of pre-signing disputes in mandating 11 arbitration of disputes arising out of the offering of the Fund Interests (suggesting disputes about 12 the formation of the contract itself must go to arbitration[)].” Id. 17. This is question-begging. 13 “[T]he threshold issue is whether that document constituted a binding agreement at all. If it did 14 not constitute such an agreement, it follows that the arbitration provision is not enforceable.” 15 Casa del Caffe Vergnano S.P.A. v. ItalFlavors, LLC, 816 F.3d 1208, 1211 (9th Cir. 2016).6 16 Finally, Rosenbach asserts that Empros has admitted in this litigation that there was a valid 17 contract. Oppo. 19–21. Rosenbach’s argument is that “Empros has alleged that it rejected 18 Rosenbach from the Fund because he breached confidentiality provisions in the offering 19 documents.” Id. at 19–20. To support that assertion, Rosenbach cites the Complaint’s allegation 20 that “Empros also learned that Rosenbach had disclosed his prospective investment, as well as the 21 pricing terms the parties had discussed, to one of Empros’s most significant competitors. This 22 violated the confidentiality provisions in the Subscription Documents.” Compl. ¶ 60. Rosenbach 23 is incorrect that this allegation is a judicial admission that a contract had been formed. Reasonably 24 5 If anything, the parties’ post-June 10 behavior as a whole supports the inference that they did not 25 believe a contract had been formed. I conclude that, applying the objective standard, there was no mutual assent to begin with, so consideration of this evidence is unnecessary. 26

6 Rosenbach also makes much of the fact that Empros, not him, drafted the Fund Documents. He 27 does not indicate why that fact would alter my analysis; the fundamental question is the parties’ 1 understood, Empros was not pleading that there was already a contract and that Rosenbach 2 breached it by disclosing this information. Nor was it arguing it was permitted to reject him as an 3 investor because of actual breach of these provisions. Empros simply claims that what Rosenbach 4 did would violate the confidentiality provisions he was agreeing to. Empros would not, for 5 instance, have been able to sue Rosenbach for breach of these confidentiality provisions because 6 no contract was formed. It has not, as Rosenbach argues, undermined its theory of the case with a 7 subtle admission that there was a contract.7 8 B. Irreparable Injury 9 Being compelled to arbitrate claims without having agreed to arbitrate them is an 10 irreparable injury. See, e.g., Johnson v. Oracle Am., Inc., No. 17-CV-05157-EDL, 2017 WL 11 11493479, at *2 (N.D. Cal. Oct. 4, 2017); AT&T Mobility LLC v. Bernardi, No. C 11-03992 CRB, 12 2011 WL 5079549, at *10 (N.D. Cal. Oct. 26, 2011); accord Merrill Lynch Inv. Managers v. 13 Optibase, Ltd., 337 F.3d 125, 129 (2d Cir. 2003). A party would otherwise be “forced to defend 14 an improper arbitration demand [that] requires expending human and monetary capital for which 15 there is no adequate remedy at law.” AT&T Mobility, 2011 WL 5079549, at *10. 16 The difference in this case from a standard injunction against improper arbitration—and 17 the sole argument Rosenbach makes about irreparable injury—is that the arbitration here had been 18 held in abeyance at the parties’ request and is now withdrawn. Oppo. 21; see Sullivan Decl. Ex. E 19 at ECF 25. Therefore, any injury from that arbitration, Rosenbach argues, is speculative and not 20 immediate. Id. I agree. So long as the arbitration is held in abeyance or withdrawn, Empros faces 21 no concrete injury. 22 C. Balance of Equities and Public Interest 23 The balance of equities tracks the merits and irreparable-injury analysis here. Because 24

25 7 Rosenbach relies on Vita Planning & Landscape Architecture, Inc. v. HKS Architects, Inc., 240 26 Cal. App. 4th 763 (2015). There, a party attempted to argue it was not bound by a forum selection clause. Id. at 844–45. It admitted in its complaint, however, that it had “entered into a contractual 27 agreement, evidenced by a writing.” Id. at 845 (internal alteration omitted). The court found that 1 Empros never agreed to arbitrate, the burden on it in being compelled to do so is great. See AT&T 2 Mobility, 2011 WL 5079549, at *11–*12; Ingram Micro Inc. v. Signeo Int’l, Ltd., No. SACV 13- 3 1934, 2014 WL 3721197, at *5 (C.D. Cal. July 22, 2014). On the other hand, an injunction would 4 create no cognizable burden on Rosenbach because he is not party to an agreement to arbitrate 5 with Empros. Ingram, 2014 WL 3721197, at *5. 6 To the extent the public interest is implicated, it too favors prohibiting arbitration where 7 there is no agreement to do so and the arbitration is not stayed. Id.; World Grp. Sec. v. Ko, No. 8 C035055 EDL, 2004 WL 1811145, at *8 (N.D. Cal. Feb. 11, 2004). 9 D. Conclusion 10 This record demonstrates that the parties never bound themselves to any contract, an 11 agreement to arbitrate. Empros has shown a likelihood of success on the merits. But because the 12 challenged arbitration is now withdrawn, there is no threat of irreparable injury to Empros. The 13 motion for a preliminary injunction is DENIED. 14 II. MOTIONS TO SEAL 15 Empros has also filed two administrative motions to seal, respectively, portions of its 16 complaint and Motion, as well as their related exhibits. Dkt. Nos. 2, 11. I GRANT IN PART and 17 DENY IN PART those motions. 18 Courts “start with a strong presumption in favor of access to court records.” Foltz v. State 19 Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003). The public possesses an 20 important right to inspect public records, including judicial records. Ctr. for Auto Safety v. 21 Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016). Accordingly, when a party seeks to seal 22 judicial records connected to a motion—such as the one at issue here—that is “more than 23 tangentially related to the underlying cause of action,” it “must demonstrate that there are 24 ‘compelling reasons’ to do so.” Id. at 1096–99. “When ruling on a motion to seal court records, 25 the district court must balance the competing interests of the public and the party seeking to seal 26 judicial records.” In re Midland Nat. Life Ins. Co. Annuity Sales Practices Litig., 686 F.3d 1115, 27 1119 (9th Cir. 2012). Further, this District’s local rules require that requests to seal be “narrowly 1 The motions are DENIED to the extent they seek to redact the identity of Palantir as the 2 company Rosenbach wanted to invest in. The parties have already revealed that fact in their non- 3 redacted briefing. See, e.g., Oppo. 8; Reply 12. Even if they had not, I would deny the request 4 because Empros has not shown there are compelling reasons to redact its identity. The motions 5 are also DENIED with respect to the price term for the shares and Weisbarth’s name because those 6 were revealed in Rosenbach’s briefing. See, e.g., Oppo. 8. 7 The first motion is GRANTED IN PART with respect to the Fund Documents. I will not, 8 however, seal the entire documents as Empros requests. It is the rare circumstance in which an 9 entire document is sealable, as opposed to the narrow tailoring the law requires. See CIV. L. R. 79- 10 5(b). Empros may not redact any portion of the documents referenced by either party or in my 11 Order, because those are the provisions central to this dispute. But there are compelling reasons to 12 seal the provisions of those otherwise confidential documents that are unrelated to the issue here. 13 Empros must submit unsealed versions of those documents that redact only provisions not 14 referenced in the briefing or my Order. 15 The motions are otherwise GRANTED. Many of the other redactions concern personal 16 identifying or contact information (such as phone numbers and email addresses); there is no public 17 interest in that information but its dissemination could easily cause harm to those individuals. The 18 remaining redactions are of confidential business or financial information, such as the amount and 19 terms of the origination fee or specific information related to bank accounts and transactions. 20 Again, that information is not relevant to the present dispute but, as a sworn declaration attests, 21 could cause competitive harm if it were widely known. 22 Accordingly, Empros is ORDERED to submit unsealed versions of the following with no 23 redactions: (1) its Complaint and (2) its Memorandum of Points and Authorities in Support of its 24 Motion. Empros is further ORDERED to submit unsealed versions of Complaint Exhibits A–N 25 and R with only the redactions they proposed and I have approved above. Empros does not need 26 to file unsealed versions of Complaint Exhibits O–Q because they contain only confidential 27 personal or business information not relevant to settling the dispute. It does not need to file new 1 publicly available versions of those documents already conform to this Order. 2 The proposed redactions in Complaint Exhibit W are generally impermissible because they 3 relate only to Palantir’s identity. There may, however, be other sealable information in that 4 exhibit. Therefore, Empros is ORDERED to submit an unredacted, unsealed copy of that exhibit 5 unless it believes it contains information sealable under this Order; if so, Empros shall instead 6 submit a filing within 14 days with specific redactions and the compelling reasons for each. 7 Finally, Empros moves to delete three items from the docket entirely: Exhibit V to its 8 Complaint and the corresponding copies (redacted and unredacted) of that exhibit filed with its 9 motion to seal. See Dkt. No. 6. It claims that the documents were filed incorrectly, that the 10 redacted versions “contain confidential information that should have been redacted,” and that the 11 unredacted version “omits corresponding highlighting indicating the material to be redacted.” Id.8 12 Empros cannot simply delete the documents in their entirety because it relies on them in its 13 Complaint, see Compl. ¶ 66; consequently, I cite the exhibit in my Order on the preliminary 14 injunction. None of the uses of that exhibit in Empros’s Complaint or my Order are sealable. 15 Empros currently redacts Weisbarth’s name, which is not permitted under this Order; the other 16 two current redactions are of personal contact details and are, accordingly, proper. If there is other 17 information in that exhibit that Empros believes can properly be redacted, it shall submit a filing 18 within 14 days identifying specific redactions and the compelling reasons for each. If there are no 19 further redactions that would comply with this Order, Empros is ORDERED to submit an unsealed 20 version of the document with only the two current redactions I approve. 21 Empros shall submit the unsealed versions of its documents as described within 14 days. 22 CONCLUSION 23 It is worth underscoring that Empros’s motion for a preliminary injunction concerns 24 whether there was an agreement between the parties to arbitrate, and in that context it argued the 25 broader point that no contract at all exists between them. The record on this motion for 26

27 8 At Empros’s request, the ECF Help Desk blocked those documents from public access pending 1 preliminary injunction supports that broader contention, as I discuss above, but the holding in this 2 Order is focused on the narrower question of whether an agreement to arbitrate exists. None does. 3 || Yet because there is no risk of irreparable injury, Empros’s motion is DENIED. 4 IT IS SO ORDERED. 5 Dated: November 12, 2020 .

mr. Ortick 7 United States District Judge 8 9 10 11 12

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Z 18

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