Cova et al v. Charter Communications, Inc.

Filing 35

MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that Defendant's Motion to Compel Individual Arbitrations and to Stay Litigation (ECF No. 16 ) is GRANTED. This case is STAYED until such time as the parties complete the individual arbitrations. The parties shall notify the Court within ten (10) days of completing arbitration. IT IS FURTHER ORDERED that, in light of the stay, all other pending motions are DENIED without prejudice to refiling, as appropriate, upon lifting of the stay. IT IS FINALLY ORDERED that this case shall be deemed closed for statistical purposes only, subject to reopening upon lifting of the stay herein imposed or other appropriate Order. Signed by District Judge Ronnie L. White on February 17, 2017. (BRP)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION

RENA COVA, et al. ,
Plaintiffs,
V.

CHARTER COMMUNICATIONS , INC .,
Defendant.

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Case No. 4 :16-cv-469-RLW

MEMORANDUM AND ORDER

This matter is before the Court on Defendant' s Motion to Compel Individual Arbitrations and
to Stay Litigation (ECF No. 16). In the Motion, Defendant asks this Court to compel Plaintiffs Reno
Cova, Logan O' Connor, and Zach Splaingard to arbitrate their claims on an individual basis against
Charter; and stay all further proceedings in this case pending the arbitrations, including the time for
Charter to answer the Complaint

BACKGROUND
Charter and Plaintiffs Reno Cova ("Cova"), Logan O' Connor ("O' Connor"), and Zach
Splaingard ("Splaingard") (collectively, "Plaintiffs") entered into a written agreement to arbitrate
those "disputes and claims arising out of or relating to" the "Terms and Conditions for Charter
Residential Services" (the "Agreement").
A. Cova
Cova began receiving video and internet service from Charter on or about November 25,
2005. On the front of Cova' s monthly bill, dated April 17, 2013 , under the caption "Charter News,"
Charter advised Cova that "Charter' s Residential Terms and Conditions of Service have changed;

among other items, the provision regarding the arbitration of claims/disputes has been modified. The
modifications shall be effective May 22, 2013."
Cova's Agreement stated, in pertinent part, "You hereby acknowledge and agree that Charter
may elect to resolve all controversies, disputes, or claims or any kind arising hereunder (whether
raised by you or Charter) through binding arbitration." Cova continued his service after receiving his
April 17, 2013 bill.
In a monthly bill dated August 17, 2014, Cova was advised that Charter "restructured" the
Residential Terms and Conditions of Service effective October 1, 2014. The notification on the bill's
front page invited Cova to review the "restructured" Residential Terms and Conditions of Service by
visiting charter.com/termsofservice. The "restructured" Residential Terms and Conditions contains a
substantively identical arbitration agreement.
The Agreement contains a jury trial waiver and a class action waiver.

Finally, the

Agreement contains an opt-out provision, which provides:
If Subscriber does not wish to be bound by these arbitration provisions, Subscriber
must notify Charter in writing within 30 days of (a) the date that this arbitration
provision becomes effective, if Subscriber is an existing customer, or (b) the date that
Subscriber first subscribes to the Service(s). Subscriber may opt out by mail to the
Arbitration Notice Address. Subscriber's written notification to Charter must include
Subscriber's name, address, and Charter account number as well as a clear statement
that Subscriber does not wish to resolve disputes with Charter through arbitration.
Subscriber' s decision to opt out of this arbitration provision will have no adverse
effect on Subscriber' s relationship with Charter or the delivery of Services to
Subscriber by Charter.

Cova did not opt out of the arbitration provision within thirty (30) days of when it became effective.
Plaintiffs assert that Cova "never provided, signed, accepted, or assented to any arbitration provision
regarding his Charter services." (ECCF No . 26 at 3).
B. O' Connor
O' Connor began receiving internet service from Charter on or about July 21 , 2014.

2

O'Connor's Agreement with Charter included an agreement to arbitrate stating, in pertinent
part, " You hereby acknowledge and agree that Charter may elect to resolve all controversies,
disputes or claims of any kind arising hereunder (whether raised by you or Charter) through binding
arbitration." Later in 2014, Charter "restructured" the Residential Terms and Conditions of Service
effective October l, 2014. In O' Connor' s monthly bill dated August 13, 2014, Charter notified him
of this restructuring and invited him to review the " restructured" Residential Terms and Conditions
of Service by visiting charter.com/termsofservice.

The " restructured" Residential Terms and

Conditions of Service contains a substantially identical arbitration agreement.

O ' Connor continued

his service after that and has not canceled it. O' Connor' s Agreement with Charter contained the
same jury waiver, class action waiver, and opt out provisions that were quoted previously. O'Connor
did not opt out of the arbitration provision within thirty (30) days of when it became effective.
Plaintiffs maintain that O ' Connor is " no longer a Charter subscriber and was never provided,
signed, accepted, or assented to any arbitration provision regarding his Charter services." (ECF No.
26 at 3).
C. Splaingard
Splaingard began receiving internet service from Charter on or about July 8, 2013.
Splaingard ' s Agreement included a detailed agreement to arbitrate, which stated in pertinent part,
" You hereby acknowledge and agree that Charter may elect to resolve all controversies, disputes or
claims of any kind arising hereunder (whether raised by you or Charter) through binding arbitration."
In a monthly bill dated August 1, 2014, Charter notified Splaingard that it would be "restructuring"
the Residential Terms and Conditions of Service, effective October 1, 2014. The "restructured"
Residential Terms and Conditions contained a substantively identical arbitration agreement.
Splaingard thereafter continued his service to this day. The Agreement contained a jury trial waiver,
class action waiver, and opt out provisions. Splaingard did not opt out of the arbitration provision
within thirty (30) days when it became effective.
3

Plaintiffs assert that Splaingard continues to use Charter' s services and "never signed,
accepted, or assented to any arbitration provision regarding his Charter services." (ECF No. 26 at 4).
D. First Amended Complaint
Plaintiffs filed the instant lawsuit, which was removed to federal court. On April 7, 2016,
Plaintiffs filed their First Amended Complaint. (ECF No . 9). Plaintiffs alleged that, since 2005 ,
Charter advertised that it was selling or providing its services for the applicable monthly itemized
rates, but that Charter' s "products and services were not being offered for or provided at the total
dollar rates marketed, advertised, and intended." (ECF No. 9,

~~10-11).

In addition, Plaintiffs

alleged that Charter "failed to disclose that Defendant would be selling or providing for other
valuable consideration, Defendant's subscribers' personal identifiable information, specifically
names, addresses, and other subscriber information such as retail subscription packages/channels, to
third parties unknown to the subscribers and known to Defendant." (ECF No. 9,

~12) .

Plaintiffs

allege three alternative claims in Complaint: initial violation of the 47 U.S.C. §551(a)(l) for failure
to deliver initial notifications (Count I), subsequent violation of 4 7 U.S.C. §551 (a)(l) for failure to
deliver yearly notifications (Count II), and violations of 47 U.S.C. §551(a)(l)(A)-(E) for failure to
clearly and conspicuously disclose information (Count III) . Plaintiffs entitle their latest pleading as
the "First Amended Class Action Complaint" and purport to bring this action on behalf of
"themselves and all others similarly situated."

DISCUSSION
At issue in this case is whether the parties entered into a valid agreement to arbitrate
under the Federal Arbitration Act (FAA). Second, the Court must determine whether this dispute
falls under the coverage of the arbitration agreement.

I.

Valid Arbitration Agreement

4

Charter asserts that there is a valid arbitration agreement and that the agreement is supported
by the strong state and federal policy in favor of arbitration. (ECF No. 17).

Plaintiffs,

m

tum,

assert that there is no agreement to arbitrate enforceable under the FAA. (ECF No. 26 at 2).
Under the FAA, a written arbitration agreement "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. Section 2 reflects congressional intent "to overcome judicial hostility to
arbitration agreements." Allied- Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 272, 115 S.Ct.
834, 130 L.Ed.2d 753 (1995). But it also "gives States a method for protecting consumers against
unfair pressure to agree to a contract with an unwanted arbitration provision," if the contract
violates state law. Id. at 281, 115 S.Ct. 834. "What States may not do is decide that a contract is
fair enough to enforce all its basic terms (price, service, credit), but not fair enough to enforce its
arbitration clause." Id. Doubts are resolved in favor of arbitrability. Moses H Cone Mem'l Hosp.
v. Mercury Constr. Co., 460 U.S. 1, 24- 25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983). "But general

contract defenses, such as unconscionability, ' may be applied to invalidate arbitration
agreements without contravening § 2. "' Cicle v. Chase Bank USA, 583 F.3d 549, 553-54 (8th
Cir. 2009)(citing Doctor's Assocs., Inc. v. Casarotto, 517 U.S . 681, 687, 116 S.Ct. 1652, 134
L.Ed.2d 902 (1996)).
The validity of an arbitration agreement is determined by state contract law. E. E. 0. C. v.
Woodmen of World Life Ins. Soc., 479 F.3d 561, 565 (8th Cir.2007). Under Missouri law, the

basic elements of a contract are offer, acceptance of that offer, and consideration to support the
contract. Karzon v. AT & T, Inc., No. 4:13-CV-2202 CEJ, 2014 WL 51331 , at *2 (E.D. Mo. Jan.
7, 2014) (citing Citibank (S.Dakota), NA . v.. Wilson, 160 S.W.3d 810, 813 (Mo. Ct. App.
2005)).
5

The Court holds that all of the elements of a contract are present to support the validity of
the arbitration agreement. The Complaint alleges that Plaintiffs received services from Charter
pursuant to a written agreement. Charter provided evidence that it notified Cova, O'Connor, and
Splaingard that the terms and conditions would be changed by an effective date.

Charter

provided the new terms and conditions to the Plaintiffs. These restructured terms and conditions
stated:

If Subscriber does not wish to be bound by these arbitration prov1s10ns,
Subscriber must notify Charter in writing within 30 days of (a) the date that this
arbitration provision becomes effective, if Subscriber is an existing customer, or
(b) the date that Subscriber first subscribes to the Service(s). Subscriber may opt
out by mail to the Arbitration Notice Address. Subscriber's written notification to
Charter must include Subscriber's name, address, and Charter account number as
well as a clear statement that Subscriber does not wish to resolve disputes with
Charter through arbitration. Subscriber's decision to opt out of this arbitration
provision will have no adverse effect on Subscriber's relationship with Charter or
the delivery of Services to Subscriber by Charter.

Neither Cova, O'Connor, nor Splaingard opted-out within thirty (30) days.
Plaintiffs argue that an express agreement to arbitration was not offered to Plaintiff nor
did Plaintiffs accept these offers. (ECF No. 26 at 10).

Plaintiffs notes that Charter never

provided any arbitration provision to them in-person, by mail, or by email. (ECF No. 26 at 10).
Plaintiffs claim that Charter's "unilaterally published statements" did not constitute valid offers.
(ECF No 26 at 10 (citing Johnson v. McDonnell Douglas Corp., 745 S.W.2d 661, 662 (Mo.
1988); Hobbs v. Tamko Bldg. Prod., Inc., 479 S.W.3d 147, 148-50 (Mo. Ct. App. 2015)).
Plaintiffs cite Hobbs for the proposition that the "mere acceptance of and payment for goods
does not constitute acceptance of all the terms in a seller's proposed term sheet, and would not
create a contract that includes an arbitration agreement." (ECF No. 26 at 10-11 (citing Hobbs,
479 S.W. 3d at 149). Likewise, Plaintiffs assert that "there has to be more than continuing

6

payment on the part of a consumer to constitute bargained-for consideration." (ECF No. 26 at 11
(citing Hobbs, 479 S.W. 3d at 149)). Plaintiffs state that Charter has not provided any signatures
evidencing Plaintiffs' acceptance of any arbitration agreement and has not presented "other
evidence establishing Plaintiffs assented to abide by the terms of any arbitration agreement."
(ECF No. 26 at 12). Plaintiffs contend that it is not sufficient acceptance of the terms of the
agreement for them to have not opted-out within thirty (30) days. Plaintiffs further argue that
there was no consideration for the addition of the arbitration provision and they were not
provided with any documents which modified the terms of their Agreement. (ECF No. 26 at 1314).
Despite Plaintiffs' concerns, the Court holds that the parties have entered into a valid and
enforceable contract with an arbitration provision. Plaintiffs admit that they received services
from Charter pursuant to a written agreement. (ECF No. 9,

~~22,

27). The contract clearly

governed Plaintiffs' agreement with Charter with respect to their use of Charter's services, the
cost, and related terms. Essentially, Plaintiffs are asking this Court to hold that the "contract is
fair enough to enforce all its basic terms (price, service, credit), but not fair enough to enforce its
arbitration clause." Allied-Bruce Terminix Companies, Inc. v. Dobson, 513 U.S. 265, 281, 115 S.
Ct. 834, 843, 130 L. Ed. 2d 753 (1995). The Court, however, holds that all of the elements of a
valid contract under Missouri law are present. Karzon, 2014 WL 51331, at *2 (citing E.E. 0. C. v.
Woodmen of World Life Ins. Soc., 479 F.3d 561 , 565 (8th Cir. 2007) ("The validity of an

arbitration agreement is determined by state contract law."). Under Missouri law, the basic
elements of a contract are offer, acceptance of that offer, and consideration to support the
contract. Citibank (S.Dakota), NA., 160 S.W.3d at 813. In a similar case, the Court has held that
a formal agreement, signed by both parties, is not required for a valid a contract:
7

Missouri contract law does not require acceptance of an offer to be made "by
spoken or written word." [Citibank (S.Dakota), N A., 160 S.W.3d at 813] (citation
omitted). " An offer may, instead, be accepted by the offeree's conduct or failure to
act." Id. Here, plaintiff was provided with ample notice of his right to opt out, the
means by which to do so, and the date by which he was required to exercise his
right to do so. By failing to opt out, he affirmatively accepted the arbitration
agreement. See Cicle v. Chase Bank USA, 583 F.3d 549, 555 (8th Cir.2009)
(arbitration agreement that was deemed accepted by failure to opt out not
unconscionable under Missouri law).

Karzon, 2014 WL 51331 , at *2.
The Court notes that the bill clearly directs Plaintiffs to Charter' s website, which provides the
revised language of the terms and conditions, including the arbitration provision.
Charter provided billing statements, which constitute written offers. Plaintiffs never assert that
that did not receive monthly bills from Charter. Thus, they received the offer. Further, under
modem contractual agreements, the Court holds that Plaintiffs accepted Charter' s offer by
continuing to receive services from Charter. Karzon, 2014 WL 51331 , at *2 (quoting Citibank

(S.Dakota), NA., 160 S.W.3d at 813 (" An offer may, instead, be accepted by the offeree's
conduct or failure to act. " ); Cicle, 583 F.3d at 555 ("These sorts of take-it-or-leave-it agreements
between businesses and consumers are used all the time in today's business world. If they were
all deemed to be unconscionable and unenforceable contracts of adhesion, or if individual
negotiation were required to make them enforceable, much of commerce would screech to a
halt."). As discussed, Charter gave Plaintiffs notice that the terms and conditions of their
contract with Charter would be changed by an effective date and directed Plaintiffs to the
location where those restructured terms were stated. Charter also gave Plaintiffs an opportunity
to opt out of the arbitration provision, but Plaintiffs did not do so. Thus, the Court holds that
Plaintiffs accepted the revised contractual terms, including the arbitration provisions, by
continuing their service with Charter. Finally, the Court holds that the agreement between the
parties is supported by consideration. The arbitration provision states that "Charter and
8

Subscriber agrees to arbitrate disputes and claims arising out of or relating to this Agreement, the
Services or marketing of the Services Subscriber has received from Charter." (ECF No. 17-6).
The arbitration agreement is mutual and requires Charter to submit disputes to arbitration (with a
few exceptions), and requires Charter to submit any defenses to a subscriber's claims to
arbitration. See Credit Acceptance Corp. v. Niemeier, No. 4:15-CV-555-CEJ, 2015 WL
4207122, at *3 (E.D. Mo. July 10, 2015)(" [T]he agreement explicitly states that either party can
compel arbitration when there is a ' dispute.' Thus both parties are giving up something (their
right to come to court) if either party invokes the arbitration agreement in a ' dispute.' That is
mutual consideration."). Moreover, contrary to Plaintiffs' representations, Charter could not
changes the terms and conditions without notice, retroactively and unilaterally. Rather, the
agreement provides that Charter would provide advanced notice of any changes and that the
subscriber' s continued use of the service after notice of the change would constitute acceptance
of change.
Plaintiffs cite this Court to Campbell v. Adecco USA, Inc., No. 2:16-CV-04059-NKL,
2016 WL 3248579 (W.D. Mo. June 13 , 2016) as supplemental authority to support their claim
that there was not a valid and enforceable arbitration agreement. See ECF No. 31-1. However,
the Court finds that the Campbell decision is inapposite to the legal question before the Court.
The Court notes that the Campbell contract was a contract for employment-at-will, not for goods
or services as in the instant case. At-will employment contracts are different because "the
promise of at-will employment, standing alone, is insufficient consideration to support an
arbitration agreement signed by an employee." Leonard v. Delaware N. Companies Sport Serv.,
Inc., No. 4:15 CV 1356 CDP, 2016 WL 3667979, at *5 (E.D. Mo. July 11, 2016).

9

In sum, the Court holds that there was valid Agreement and an enforceable arbitration
prov1s1on.
II.

Dispute Falls Within Arbitration Agreement

Plaintiffs also argue that Defendant has failed to establish that Plaintiffs' disputes fall
within the scope of any arbitration provision. (ECF No. 26 at 16-19). As stated, 9 U.S.C. §2
provides for enforcement of arbitration agreements only when they encompass controversies
"arising out of such contract or transaction." Plaintiffs note that their cause of action arises out
of a federal statute that mandates Charter to provide a separate, written privacy policy to
Plaintiffs at the inception of their services and annually thereafter. (ECF No. 26 at 16 (citing 47
U.S.C. §551(a)(l)). Plaintiffs attached Charter' s Residential Subscriber Privacy Policy (ECF
No. 9-1) and Charter' s Commercial Subscriber Privacy Policy (ECF No. 9-2) to the Amended
Complaint. Plaintiffs assert that their First Amendment Right of Privacy and Publicity were
violated and said violations do not "arise out of' ECF Nos. 17-3, 17-6. (ECF No. 26 at 16).
"Plaintiffs' cause of action arises out of a federal statute which mandates Charter to provide a
separate, written privacy policy to Plaintiffs at the inception of their services and annually
thereafter." (ECF No. 26 at 16 (citing 47 U.S.C. §551(a)(l)). Plaintiffs contend that because 47
U.S.C. §551 "provides for suit in a United States district court and Defendant's privacy policy
provides for a civil action under federal law, Plaintiffs have filed their suit in this Court and are
entitled to this day in court." (ECF No. 26 at 17-18).
Plaintiffs further argue that Defendant' s privacy policy is outside the scope of the
arbitration provision. (ECF No. 26 at 18-19). Plaintiffs maintain that no document provided to
them incorporates all of the terms of a privacy policy. Plaintiffs argue that "[s]ince no privacy
policy meeting the requirements of 47 U.S.C. §551 is incorporated into any document containing
10

an arbitration provision, there has been no valid agreement to arbitrate disputes for violations of
47 U.S .C. §551 [.]" (ECF No. 26 at 19).

The Court holds that the broad arbitration provision in this case covers this dispute. The
arbitration provision provides:

Subject to the "Exclusions" paragraph below, Charter and Subscriber agrees to
arbitrate disputes and claims arising out of or relating to this Agreement, the
Services or marketing of the Services Subscriber has received from Charter.
Notwithstanding the foregoing, either party may bring an individual action on any
matter or subject in small claims court.
THIS AGREEMENT MEMORIALIZES A TRANSACTION IN THE
INTERSTATE COMMERCE.
THE FEDERAL ARBITRATION ACT
GOVERNS THE INTERPRETATION AND ENFORCEMENT OF THESE
ARBITRATION PROVISIONS.
(ECF No. 17-6 at 7). The agreement provides for 3 exclusions: (i) small claims; (ii) disputes
over intellectual property rights; and (iii) disputes associated with unauthorized use or receipt of
service. Given the extremely broad language in the arbitration agreement, all other disputes
between Plaintiffs and Charter relating to the agreement or services are subject to the arbitration
agreement. See Solis v. AT & T Mobility LLC, No. 4:15-CV-1343-RLW, 2015 WL 6739141, at
*2 (E.D. Mo. Nov. 3, 2015) (compelling arbitration where agreement required arbitration of "all
disputes and claims between us") ; Chisholm v. Career Educ. Corp., No. 411-CV-0994HEA,
2011 WL 5524552, at *2 (E.D. Mo. Nov. 14, 2011) ("broad phraseology of the arbitration
provision" included the claims at issue). The Court further notes that another district court judge
in another circuit has already enforced this arbitration provision.

See Hartman v. Charter

Commc'ns, Inc., No. 1:14-CV-00243-MR-DLH, 2015 WL 1756437, at *3 (W.D.N.C. Apr. 17,
2015) ("the arbitration provision is enforceable by this Court"). Further, the Court holds that the
privacy policy at issue arises out of or relates to the arbitration agreement, the services, or

11

marketing of Charter's services. The Agreement states, "Charter will provide Subscriber with a
copy of its customer privacy policy at the time Charter provides Service to Subscriber, and
annually afterwards, or as otherwise required by law." (ECF No. 17-6 at 6).
Contrary to Plaintiffs' arguments, the Court holds that claims under the Cable
Communications Policy Act, 47 U.S .C. §551, are subject to Arbitration.

Charter' s Privacy

Policy provides, "You may enforce the limitations imposed on us by federal law with respect to
the collection and disclosure of personally identifiable subscriber information about You,
through a civil action under federal law, in addition to other rights and remedies that may be
available to You under federal or other applicable laws." (ECF No. 9-1 at 9). The Court finds
that Plaintiffs' claims under this Policy are subject to arbitration for several reasons. First, the
privacy policy' s clause informs the subscriber that he "may" bring a lawsuit; it is neither
mandatory nor exclusive and it denotes that "other rights and remedies may be available."
Arbitration likely qualifies as another remedy. Second, "the Court finds it significant that the
Cable Act requires a cable provider to include notice about a subscriber's rights under 47 U.S.C.
§ 551(±) to bring a lawsuit. See 47 U.S.C. § 551(a) (l)(E)." Hodsdon v. Bright House Networks,
LLC, No. 1:12-CV-1580 AWI JLT, 2013 WL 1499486, at* 1 (E.D. Cal. Apr. 11, 2013). That is,

a provider must tell a subscriber about his ability to bring a lawsuit under the Cable
Communications Policy Act. Third, the arbitration clause is quite broad. Fourth, Plaintiffs cite
to nothing in the 47 U.S.C. §551 exempting it from the reach of the FAA. See Hodsdon , 2013
WL 1499486, at * 1 (applying all of these factors to a similar policy provision and holding that
privacy claims were subject to arbitration);1 see also Bayer v. Comcast Cable Commc'ns, LLC,

1

See Hodsdon , *2:
Given the permissive and "non-exclusive" language of the privacy policy clause,
the Cable Act's requirement that a cable subscriber be informed of 47 U.S.C. §
12

No. 12 C 8618, 2013 WL 1849519, at *3-*4 (N.D. Ill. May 1, 2013). In sum, the Court holds
that the agreement to arbitrate is enforceable based upon the broad arbitration provision and
because it is not contradicted by federal statutory law or the privacy policy. Green Tree Fin.
Corp.-Alabama v. Randolph, 531 U.S. 79, 89, 121 S. Ct. 513 , 521, 148 L. Ed. 2d 373 (2000)

("[W]e have recognized that federal statutory claims can be appropriately resolved through
arbitration, and we have enforced agreements to arbitrate that involve such claims[.]").

III.

Unconscionability

Plaintiffs argue that Defendant' s arbitration clause is unconscionable and should be
severed from the contract. (ECF No. 26 at 19-29). Plaintiffs contend that Charter's arbitration
clauses are procedurally unconscionable because they included non-negotiable terms and onesided language.

Plaintiffs maintain that Charter' s arbitration provisions are substantively

unconscionable because the terms are objectively unreasonable. Plaintiffs argue that, under the
arbitration agreements, "Charter possesses the sole ability to choose whether or not a dispute is
heard in court, but also reserves for itself the sole ability to choose the court in which the dispute
is heard, the sole ability to choose an arbiter, and the sole ability to seek injunctive relief

551 (f)'s lawsuit provision, and the broad arbitration clause in this case, it is not at
all apparent that the parties intended to exclude Cable Act claims from arbitration.
Cf. [AT & T Techs., Inc. v. Commc'ns Workers ofAm., 475 U.S. 643 , 657, 106 S.
Ct. 1415, 89 L. Ed. 2d 648 (1986)]; [Standard Concrete Prod. Inc. v. Gen. Truck
Drivers, Office, Food & Warehouse Union, Local 952, 353 F.3d 668, 674-75 (9th
Cir. 2003)]. Because there is a presumption in favor of arbitration, the Court is
required to resolve any doubts concerning the scope of arbitrable issues in favor
of arbitration. See Mitsubishi Motors Corp. v. Soler Chrysler- Plymouth, 473 U.S.
614, 626, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985); Comedy Club, Inc. v. Improv
West Assocs., 553 F.3d 1277, 1284- 85 (9th Cir.2009). Therefore, the Court
resolves any doubt it may have in this case in favor arbitration. See A T & T
Techs., 475 U.S. at 657; Comedy Club, 553 F.3d at 1284- 86.

13

notwithstanding any part of the terms of the arbitration which entirely binds subscribers." (ECF
No. 26 at 25). Plaintiffs note that, under the arbitration provisions, a consumer waives all rights
to pursue a claim against Charter outside of the arbitration system "chosen and dominated by
Charter's own preferences." (ECF No. 26 at 26). Plaintiffs further claim that Charter' s opt-out
provision is difficult to understand, particularly since the opt-out provision does not state
whether it is to opt-out of the entire arbitration provision, the class action waiver, or the entire
contract. Plaintiffs argue that the opt-out provision requires the subscriber to mail written notice
to Charter' s "Associate General Counsel, Litigation," yet Charter argues that it was sufficient to
bind subscribers with a "casual mention in a 'News ' section of a bill that typically contains no
information regarding subscribers' substantive rights."

(ECF No. 26 at 26-27).

Plaintiffs

contend that the arbitration is unconscionable because Charter retains the ability to discard
arbitration in favor of litigation against its subscribers when it wishes. (ECF No. 26 at 27).
Finally, Plaintiffs assert that the arbitration provisions are unconscionable because they are
difficult for the average consumer to understand. (ECF No. 26 at 27).
The Court is unpersuaded by Plaintiffs position that the Arbitration Clause is
unconscionable. The Court first notes that courts no longer address unconscionability through
the dichotomy of procedural and substantive unconscionability. Brewer v. Missouri Title Loans,
364 S.W.3d 486, 492 n.3 (Mo. 2012) (en bane) (internal citations omitted); see also Torres v.
Simpatico, Inc., 781 F.3d 963 , 968-69 (8th Cir. 2015); AT&T Mobility LLC v. Concepcion, 563 U.S.
333 (2011); PR Grp., LLC v. Windmill Int'!, Ltd., No. 14-0401-CV-W-BP, 2016 WL 3033617, at

*3 (W.D. Mo. Feb. 1, 2016). Rather, "[f]actors to be considered include whether the arbitration
agreement was non-negotiable, whether the arbitration agreement's terms are clear or confusing,
whether one party or the other was in a superior bargaining position, whether the arbitration
14

agreement is one-sided, and whether the arbitration agreement is structured in a way to make
arbitration cost-prohibitive." PR Grp. , LLC, 2016 WL 3033617, at *3. The Court holds that
these factors do not weigh in favor of a finding of unconscionability. First, the contract was
negotiable because Plaintiffs were given the option of opting out of the arbitration provision.
Second, the cost of arbitration is not prohibitively high because the arbitration provision requires
Charter to pay certain filing fees and arbitrator fees for claims up to $75,000. (ECF No. 17-6 at
8). Plaintiffs do not identify any high-pressure sales tactics or duress, nor do Plaintiffs object to
the AAA or applicable rules.

Plaintiffs also do not claim that they did not understand the

contract, particularly because at least one of them is a lawyer. Plaintiffs' mere failure to read the
contract does not make it voidable for unconscionability. Finally, the Court holds that Plaintiffs
have presented no evidence of a disparity in bargaining power, other than those normally present
in every contract between a corporation and an individual. The Court further emphasizes that the
arbitration agreement does not limit Plaintiffs only to arbitration. Rather, it affords them the
opportunity to pursue claims in small claims court. "Additionally, Plaintiffs position that the
limitation of remedies provision makes the entire provision unconscionable also fails. The
validity of provisions such as this is to be determined by the arbitrator." Chisholm v. Career
Educ. Corp., No. 41 l-CV-0994HEA, 2011 WL 5524552, at *2 (E.D. Mo. Nov. 14, 2011) (citing
Homestake Mining Co. V United Steelworkers of Am. 153 F.3d 678, 680 (8th Cir. 1998)). In a

similar vein, Charter has eliminated the financial disincentive to bring small claims by specifying
its arbitration provision that it will pay the filing fees and arbitrator fees for claims up to
$75,000. (ECF No. 7-6 at 7). See Jenkins v. First Am. Cash Advance of Georgia, LLC, 400 F.3d
868, 878 (11th Cir. 2005); Chisholm v. Career Educ. Corp., No. 411-CV-0994HEA, 2011 WL
5524552, at *2 (E.D. Mo. Nov. 14, 2011) (citing Faber v. Menard, 367 F.3d 1048, 154 (8th Cir.

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2004) ("Plaintiff has failed to present ' specific evidence of likely arbitrator's fees and [her]
financial ability to pay those fees .'").

For these reasons, the Court holds that the Agreement, including the arbitration
agreement, was not unconscionable and will be enforced.
Accordingly,
IT IS HEREBY ORDERED that Defendant's Motion to Compel Individual Arbitrations

and to Stay Litigation (ECF No. 16) is GRANTED . This case is STAYED until such time as
the parties complete the individual arbitrations. The parties shall notify the Court within ten (10)
days of completing arbitration.
IT IS FURTHER ORDERED that, in light of the stay, all other pending motions are
DENIED without prejudice to refiling, as appropriate, upon lifting of the stay.
IT IS FINALLY ORDERED that this case shall be deemed closed for statistical

purposes only, subject to reopening upon lifting of the stay herein imposed or other appropriate
Order.

Dated this 17th day of February, 2017.

~/.Wvia

RONNIE WHITE
UNITED STATES DISTRICT JUDGE

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