Perei v. Arrigo DCJ Sawgrass, Inc.
Filing
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ORDER granting 6 Defendant's MOTION to Amend/Correct 3 Defendant's MOTION to Stay and to Compel Arbitration. Signed by Judge Beth Bloom on 3/6/2018. (ail)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 18-cv-60091-BLOOM/Valle
ANTHONY PEREI,
Plaintiff,
v.
ARRIGO DCJ SAWGRASS, INC.,
Defendant.
________________________________________/
ORDER ON MOTION TO COMPEL ARBITRATION
THIS CAUSE is before the Court upon Defendant’s Amended Motion to Stay and
Compel Arbitration, ECF No. [6], (the “Motion”). The Court has carefully reviewed the Motion,
the applicable law, the parties’ supporting and opposing briefs, and is otherwise fully advised of
the record in this case. For the reasons that follow, the Motion is granted.
I.
BACKGROUND
Plaintiff filed this lawsuit against Defendant for violations of the Fair Credit Reporting
Act (“FCRA”) and the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”) arising
from his purchase of a 2016 Dodge Dart from Defendant. See ECF No. [1]. In the Complaint,
Plaintiff alleges that, on September 1, 2015, he entered into a contract with Defendant for the
purchase of a vehicle, also securing his financing through Defendant. Id. at ¶¶ 26-27. At no
point in time did Plaintiff execute a credit application or otherwise authorize Defendant to submit
an application for a personal line of credit on his behalf for a Chrysler MasterCard. Id. at ¶ 29.
Two years later, on September 14, 2017, non-party First National Bank of Omaha allegedly
contacted Plaintiff to inform him that it was waiving his monthly payment due to the impact of
Hurricane Irma. Id. at ¶ 30. The Complaint alleges that, as a result of this call, Plaintiff
Case No. 18-cv-60091-BLOOM/Valle
discovered that Defendant had opened a credit line with Chrysler MasterCard under his name on
the same date he purchased the vehicle. Id. at ¶31. Based on these facts, Plaintiff asserts in
Count I that Defendant violated the FCRA by pulling his credit report to open a line of credit in
his name without his knowledge or consent. Id. at ¶¶ 34-43. In Count II, Plaintiff alleges that
Defendant’s actions constitute unfair and deceptive acts or practices in violation of FDUTPA.
Id. at ¶¶ 44-52. In addition to actual, statutory, punitive damages and attorney’s fees and costs,
the Complaint seeks a declaration that Defendant’s practices violate the FCRA’s permissible
uses. Id. Plaintiff also demands a trial by jury. Id.
In response to the Complaint, Defendant moves to compel arbitration pursuant to the
terms of the Arbitration Provision contained within the Retail Installment Sale Contract, see ECF
No. [6-1] (the “Arbitration Provision”), and the Arbitration of Disputes and Waiver of Jury Trial
Agreement, see ECF No. [6-2] (the “Arbitration Agreement”). Plaintiff filed a timely Response
in Opposition. See ECF No. [9]. Although Defendant had the opportunity to file a Reply,
Defendant did not do so within the allotted time. Accordingly, the Motion is now ripe for
review.
II.
LEGAL STANDARD
The Federal Arbitration Act (“FAA”) provides that pre-dispute agreements to arbitrate
“evidencing a transaction involving commerce” are “valid, irrevocable, and enforceable save
upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2.1
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Although the parties sometimes quote from and rely upon Florida arbitration statutes and Florida case law
interpreting such statutes, the Arbitration Provision provides that “[a]ny arbitration under this Arbitration Provision
shall be governed by the Federal Arbitration Act (9 U.S.C. § 1 et. seq.) and not by any state law concerning
arbitration.” ECF No. [6-1]. Similarly, the Arbitration Agreement provides that “[t]his arbitration provision is
subject to the Federal Arbitration Act, 9 U.S.C.A. §1, et. seq.” ECF No. [6-2]. Thus, the Court’s analysis here is
governed by the FAA and the case law interpreting the FAA.
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The FAA reflects “a liberal federal policy favoring arbitration.” AT&T Mobility LLC v.
Concepcion, 563 U.S. 333, 339 (2011). Section 3 of the FAA further states:
If any suit or proceeding be brought in any of the courts of the United States upon
any issue referable to arbitration under an agreement in writing for such
arbitration, the court in which such suit is pending, upon being satisfied that the
issue involved in such suit or proceeding is referable to arbitration under such an
agreement, shall on application of one of the parties stay the trial of the action
until such arbitration has been had in accordance with the terms of the agreement,
providing the applicant for the stay is not in default in proceeding with such
arbitration.
9 U.S.C. § 3.
“Under both federal and Florida law, there are three factors for the court to consider in
determining a party's right to arbitrate: (1) a written agreement exists between the parties
containing an arbitration clause; (2) an arbitrable issue exists; and (3) the right to arbitration has
not been waived.” Sims v. Clarendon Nat. Ins. Co., 336 F. Supp. 2d 1311, 1326 (S.D. Fla. 2004)
(citing Marine Envtl. Partners, Inc. v. Johnson, 863 So. 2d 423, 426 (Fla. 4th DCA 2003) and
Seifert v. U.S. Home Corp., 750 So. 2d 633 (Fla. 1999)). Where the claim is statutory in nature,
the court must consider if the authorizing legislative body intended to preclude the claim from
arbitration. See Mitsubishi Motors Corp. v. Soler Chrysler–Plymouth, Inc., 473 U.S. 614, 627
(1985) (“Just as it is the congressional policy manifested in the [FAA] that requires courts
liberally to construe the scope of arbitration agreements covered by that Act, it is the
congressional intention expressed in some other statute on which the courts must rely to identify
any category of claims as to which agreements to arbitrate will be held unenforceable.”); Gilmer
v. Interstate/Johnson Lane Corp., 500 U.S. 20, 26 (1991) (“Although all statutory claims may
not be appropriate for arbitration, having made the bargain to arbitrate, the party should be held
to it unless Congress itself has evinced an intention to preclude a waiver of judicial remedies for
the statutory rights at issue.”) (citation omitted).
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Confronted with a facially valid arbitration agreement, the burden is on the party
opposing arbitration to demonstrate that the agreement is invalid or the issue is otherwise nonarbitrable. Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79, 92 (2000) (“[T]he party
seeking to avoid arbitration bears the burden of establishing that Congress intended to preclude
arbitration of the statutory claims at issue.”); In re Managed Care Litig., No. 00-1334-MD, 2009
WL 856321, at *3 (S.D. Fla. Mar. 30, 2009) (“It is the burden of the party challenging a facially
valid arbitration agreement to demonstrate that the agreement is in fact unconscionable.”). “By
its terms, the [FAA] leaves no room for the exercise of discretion by a district court, but instead
mandates that district courts shall direct the parties to proceed to arbitration on issues as to which
an arbitration agreement has been signed.” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213,
213 (1985) (emphasis in original). Thus, if the aforementioned criteria are met, the Court is
required to issue an order compelling arbitration. John B. Goodman Ltd. P'ship v. THF Const.,
Inc., 321 F.3d 1094, 1095 (11th Cir. 2003) (“Under the FAA, 9 U.S.C. § 1 et seq., a district court
must grant a motion to compel arbitration if it is satisfied that the parties actually agreed to
arbitrate the dispute.”); Hemispherx Biopharma, Inc. v. Johannesburg Consol. Invs., 553 F.3d
1351, 1366 (11th Cir. 2008) (“The role of the courts is to rigorously enforce agreements to
arbitrate.”) (citation omitted).
III.
DISCUSSION
Defendant seeks to compel arbitration pursuant to the terms and conditions set forth in
the Arbitration Provision and the Arbitration Agreement. See ECF No. [6]. Section 2 of the
FAA “requires the courts to enforce an arbitration provision within a contract unless ‘such
grounds exist at law or in equity for the revocation of any contract.’” Parnell v. CashCall, Inc.,
804 F.3d 1142, 1146 (11th Cir. 2015). It is a general rule that “[t]he arbitrability of disputes—in
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other words, the determination of whether the agreement applies to the parties' claims—is
generally a gateway issue to be determined by the courts.” Robinson v. J & K Admin. Mgm’t
Sers., Inc., 817 F.3d 193, 195 (5th Cir. 2016) (citing AT&T Tech., Inc. v. Comm’ns Workers of
Am., 475 U.S. 643, 649 (1986)). “‘[W]hether the parties have a valid arbitration agreement at all
or whether a concededly binding arbitration clause applies to a certain type of controversy’ are
two examples of questions of arbitrability.” Fed. Nat'l Mortg. Ass'n v. Prowant, 209 F. Supp. 3d
1295, 1309 (N.D. Ga. 2016) (quoting Green Tree Fin. Corp. v. Bazzle, 539 U.S. 444, 452
(2003)). “And if there is doubt about [whether the arbitrator should decide a certain issue,] we
should resolve that doubt ‘in favor of arbitration.’” Bazzle, 539 U.S. at 452 (quoting Mitsubishi
Motors, 473 U.S. at 626).
However, “parties may agree to commit even threshold determinations to an arbitrator,
such as whether an arbitration agreement is enforceable” and the Supreme Court has upheld such
provisions, dubbed “delegation provisions,” as valid. Rent-A-Center v. Jackson, 561 U.S. 63, 68
(2010); Parnell, 804 F.3d at 1146. Specifically, the Supreme Court has recognized that parties
can enter into agreements “to arbitrate ‘gateway’ questions of ‘arbitrability,’ such as whether the
parties have agreed to arbitrate or whether their agreement covers a particular controversy.”
Jackson, 561 U.S. at 69.
Such a gateway question “is simply an additional, antecedent
agreement the party seeking arbitration asks the federal court to enforce, and the FAA operates
on this additional arbitration agreement just as it does on any other.” Id.
Here, the Court must focus its analysis on the text of the Arbitration Provision and the
Arbitration Agreement to determine the nature and extent of the agreement between the parties.
The Arbitration Provision states in relevant part:
Any claim or dispute, whether in contract, tort, statute or otherwise (including the
interpretation and scope of this Arbitration Provision, and the arbitrability of
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the claim or dispute), between you and us or our employees, agent, successor or
assigns, which arises out of or relates to your credit application, purchase or
condition of this vehicle, this contract or any resulting transaction or relationship
(including any such relationship with third parties who do not sign this contract)
shall, at your or our election, be resolved by neutral, binding arbitration and not
by a court action. . . .
ECF No. [6-1] (emphasis added).
Similarly, the Arbitration Agreement provides in relevant part:
Purchaser and Dealer agree to submit any and all controversies or claims
identified in this arbitration agreement (including the interpretation and scope of
this arbitration agreement, and the arbitrability of the claim or dispute), where
the amount in controversy, including attorney’s fees claims exceeds $5,000,
arising out of or relating to the vehicle transaction and all agreements executed by
Purchaser and/or Dealer related to the vehicle purchase transaction or related to
any aspect of the transaction contemplated by the parties, to binding arbitration.
Except as expressly set forth in this Agreement, it is the express intent of
Purchaser and Dealer that this arbitration provision applies to all disputes,
including contract disputes, tort claims, including fraud claims and fraud in the
inducement claims, statutory claims, including deceptive trade practices claims,
and regulatory claims, that would not have arisen but for the vehicle purchase
transaction and resulting relationship between Purchaser and Dealer. . . .
ECF No. [6-2] (emphasis added).
At the outset, the Court notes that Plaintiff does not dispute the validity of either the
Arbitration Provision or the Arbitration Agreement. See ECF No. [9]. Nor does he raise any
arguments of fraud, duress, or unconscionability, and he does not dispute signing the documents.
Id.
Plaintiff’s sole objection is that his claims do not fall within the scope of either the
Arbitration Provision or the Arbitration Agreement.
See ECF No. [9].
However, in the
Arbitration Provision, the parties expressly agreed that any claims “including the interpretation
and scope of this Arbitration Provision, and the arbitrability of the claim or dispute” are subject
to binding arbitration. ECF No. [6-1] (emphasis added). Similarly, the Arbitration Agreement
that Plaintiff signed provides that “any and all controversies or claims identified in this
arbitration agreement (including the interpretation and scope of this arbitration agreement, and
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the arbitrability of the claim or dispute)” are also subject to binding arbitration. ECF No. [6-2]
(emphasis added).
Thus, the parties delegated any disputes surrounding the scope of the
Arbitration Provision and the Arbitration Agreement to the arbitrator – not the Court.
Significantly, Plaintiff does not acknowledge the existence of the delegation clauses; much less
argue that these clauses are unconscionable. See ECF No. [9]. Consistent with the Supreme
Court’s instructions, Plaintiff’s failure to specifically challenge the delegation provisions
requires that this Court “treat [them] as valid under § 2 [of the FAA], and [] enforce [them] under
§§ 3 and 4, leaving any challenge to the validity of the [a]greement as a whole for the arbitrator.”
Jackson, 561 U.S. at 72. Thus, Defendant’s Motion is granted. Plaintiff is free to raise any
challenges to the scope of the arbitration provisions directly to the arbitrator.
IV.
CONCLUSION
For the foregoing reasons, it is ORDERED AND ADJUDGED as follows:
1. Defendant’s Amended Motion to Stay and Compel Arbitration, ECF No. [6], is
GRANTED.
2. The parties shall submit all claims asserted in the Complaint to arbitration in
accordance with the Arbitration Provision and the Arbitration Agreement.
3. This matter is STAYED pending arbitration of Plaintiff’s claims and is therefore
administratively CLOSED. The Clerk of Court is directed to CLOSE this matter
for administrative purposes. After arbitration has concluded, either party may
seek to reopen the case.
4. All pending motions are DENIED AS MOOT, and any pending deadlines are
TERMINATED.
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DONE AND ORDERED in Miami, Florida, this 6th day of March, 2018.
_________________________________
BETH BLOOM
UNITED STATES DISTRICT JUDGE
Copies to:
Counsel of Record
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