Jones v. American Credit Acceptance, LLC. et al
Filing
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MEMORANDUM Opinion and Order Signed by the Honorable Sharon Johnson Coleman on 2/11/2016:Mailed notice(rth, )
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
ANGELA JONES, on behalf of herself and all
others similarly situated
Plaintiff,
v.
AMERICAN CREDIT ACCEPTANCE,
LLC., PAR, INC., d/b/a PAR NORTH
AMERICA, and BBMHKH ENTERPRISE,
LLC d/b/a TURBO ASSET RECOVERY,
)
)
) Case No. 15-cv-8163
)
) Judge Sharon Johnson Coleman
)
)
)
)
)
Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiff, Angela Jones, on behalf of herself and all others similarly situated, brings this
action against American Credit Acceptance, LLC (ACA), Par, Inc. (Par), and BBMHKH
Enterprise, LLC, alleging violations of the Fair Debt Collection Practices Act (“FDCPA”) and
the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”). ACA now moves
this Court to compel Jones to submit her individual claims against ACA, all of which are brought
under ICFA, to arbitration pursuant to the terms of their written arbitration agreement and to stay
this action against ACA pending the completion of that arbitration proceeding. For the reasons
set forth below, this motion [10] is granted.
Background
Jones entered into a retail installment contract with Carmax-Naperville for the purchase
of a used car. (Dkt. 1 ¶ 9). ACA provided financing for the purchase in exchange for the
assignment of the contract and security interest in the vehicle. (Id. ¶¶ 9–11). Jones subsequently
defaulted on the contract, and ACA elected to enforce its security interest and to repossess the
vehicle. (Id. ¶¶ 12, 13). Jones believes that ACA retained Par, Inc. and BBMHKH to effect that
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repossession, which occurred on November 12, 2014. (Id. ¶¶ 14, 15). In her complaint, Jones
contends that ACA engaged in unfair and deceptive business practices in violation of ICFA by
failing to comply with Illinois statutes governing the repossession process or by misrepresenting
the requirements of those statutes. (Id. ¶¶ 36–72). As is relevant here, the retail installment
contract contained a one-page mandatory arbitration provision. (Dkt. 11-2). Because Jones
signed this arbitration provision, ACA now moves this Court to compel Jones to arbitrate her
individual claims against ACA and to stay this action. (Dkt. 11).
Legal Standard
The Federal Arbitration Act (FAA) governs the validity of agreements to arbitrate. Jain
v. de Mere, 51 F.3d 686, 688 (7th Cir. 1995). “A written provision in any . . . contract
evidencing a transaction involving commerce to settle by arbitration a controversy thereafter
arising out of such contract or transaction . . . shall be 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.
Under the FAA, arbitration may be compelled if it is shown that (1) there is a written agreement
to arbitrate; (2) the dispute at issue is within the scope of that agreement; and (3) there was a
refusal to arbitrate. Zurich Am. Ins. Co. v. Watts Indus., Inc., 417 F.3d 682, 687 (7th Cir. 2005).
The FAA requires that any doubts concerning the scope of arbitrable issues must be resolved in
favor of arbitration. Kiefer Specialty Flooring, Inc. v. Tarkett, Inc., 174 F.3d 907, 909 (7th Cir.
1999). Thus, a court may not deny a party’s request to arbitrate an issue unless “it may be said
with positive assurance” that the arbitration clause is not susceptible to an interpretation that
would encompass the asserted dispute. United Steelworkers of Am. v. Warrior & Gulf Nav. Co.,
363 U.S. 574, 582, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960). Where the parties have adopted a
broad arbitration clause, a court will compel arbitration unless there is forceful evidence that the
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parties intended to exclude their grievance from arbitration. Ferenc v. Brenner, 927 F. Supp. 2d
537, 542 (N.D. Ill. 2013).
Discussion
Here, Jones does not contest the validity of the contract and its arbitration provision or
that she has refused ACA’s requests to arbitrate pursuant to that provision. Thus, the sole
question before this Court is whether the current dispute is encompassed by the terms of the
arbitration provision, which provides in pertinent part that:
A “Claim” is any claim, dispute or controversy between you and us that in any way arises from
or relates to this consumer credit sale, the purchase you are financing by way of this Contract,
the Vehicle and related goods and services that are the subject of the purchase and this Contract,
or the collection and servicing of this Contract, including but not limited to:
• Initial claims, counterclaims, cross-claims and third-party claims;
• Disputes based on contract, tort, consumer rights, fraud, and other intentional torts . . .;
• Disputes based on constitutional grounds or on laws, regulations, ordinances or similar
provisions; and
• Disputes about the validity, enforceability, arbitrability, or scope of this Arbitration
Provision or this Contract . . . .
Because the contract explicitly granted Carmax (and its assignee ACA) the right to repossess the
vehicle upon default, Jones’ claims concerning that repossession can be construed as claims
“arising from or relating to this consumer credit sale,” and concerning the “collection and
servicing of the contract.” Moreover, Jones’ ICFA claim constitutes a dispute “based on . . .
laws, regulations, ordinances or similar provisions.” Accordingly, the arbitration provision is
susceptible to an interpretation encompassing Jones’ claims. Because Jones has offered no
evidence demonstrating that the parties intended to exclude such claims from arbitration, this
Court concludes that it is obligated to compel Jones to arbitrate her claims. United Steelworkers
of Am., 363 U.S. at 582.
This Court is not persuaded otherwise by Jones’ arguments that Illinois law does not
allow repossession disputes to be adjudicated via arbitration. As Jones argues, Illinois law
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requires that specific disputes arising during the repossession process must be resolved by a
“court of competent jurisdiction.” See, e.g., 625 ILCS 5/3-114(f-5)(2) (noting that if an affidavit
of defense is returned by the owner, the lienholder must apply to a court of competent
jurisdiction to determine if the lienholder is entitled to possession of the vehicle). This action,
however, is not a dispute over property rights in a vehicle occurring as part of the repossession
process. Rather, it is a separate civil suit alleging violations of the ICFA, an Illinois statute
which is subject to arbitration. See, e.g., Sherman v. AT&T Inc., No. 11 C 5857, 2012 WL
1021823 (N.D. Ill. Mar. 26, 2012) (Kendall, J.) (compelling arbitration in a case alleging ICFA
violations). Moreover, even if this action was brought directly under Illinois’ repossession
statutes, Jones has not met her burden of showing that the Illinois legislature intended for the
provisions that she relies on to preclude the waiver of judicial remedies. See Tezky v. Woodfield
Chevrolet, No. 00 C 5718, 2001 WL 946188, at *3 (N.D. Ill. Mar. 13, 2001) (Darrah, J.)
(observing that a statute which authorized suits in “United States district court or in another court
of competent jurisdiction” did not foreclose the possibility that the right to a federal forum could
be contracted away via a mandatory arbitration provision).
This Court is also not persuaded otherwise by Jones’ argument that the ACA is equitably
barred from compelling arbitration or waived its right to arbitrate because it proceeded with its
“judicial” repossession action instead of arbitrating Jones’ default. Because this is a separate
proceeding being brought under separate operative law, Jones’ cannot rely on the repossession to
demonstrate that ACA has waived its right to arbitrate because she cannot show delay or
prejudice within this action. Kawasaki Heavy Indus., Ltd. v. Bombardier Recreational Prods.,
Inc., 660 F.3d 988, 994 (7th Cir. 2011).
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Conclusion
For the foregoing reasons, defendant ACA’s motion [10] is granted. Plaintiff Angela
Jones is ordered to submit her individual claims against ACA to an arbitration proceeding. This
action is stayed with respect to ACA, pending completion of the arbitration proceeding.
SO ORDERED.
____________________________________
Sharon Johnson Coleman
United States District Court Judge
DATED: February 11, 2016
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