Whitten v. Citibank, N.A. et al

Filing 28

MEMORANDUM AND ORDER - Defendant's Motion to Compel Arbitration Filing No. 11 is granted. Plaintiff and Citibank are directed to proceed to arbitration in accordance with the terms of their agreement. This case, including claims against LVNV F unding, LLC, is stayed pending the outcome of Plaintiff and Citibank's arbitration. Plaintiff and Citibank shall file a joint status report regarding the progress of arbitration every ninety (90) days beginning June 3, 2025. The Clerk of the court is directed to set an initial status report deadline of June 3, 2025. Ordered by Magistrate Judge Jacqueline M. DeLuca. (KLF)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
KARRY WHITTEN;
4:24CV3145

Plaintiff,
vs.

MEMORANDUM AND ORDER

CITIBANK, N.A. et. al.;
Defendants.

Before the Court is Defendant Citibank, N.A.’s (“Citibank”) Motion to Compel
Arbitration. Filing No. 11. 1 For the reasons set forth herein the Court grants
Citibank’s motion and stays further proceedings.
BACKGROUND
The undisputed facts before the Court are set forth herein. On or about
January 17, 2025, Plaintiff submitted to Citibank an application for a
Citi/AAdvantage Executive World Mastercard. Filing No. 13-1. At the time Plaintiff
filled out the application, all applications for this type of credit card with Citibank
indicated the applicant agreed to a card agreement. Filing No. 13-1. As a result of
the application, on January 21, 2015, Citibank mailed Plaintiff a notice of new
account approval for a credit card with an account number ending in 4020. Filing
No. 13-2. The card agreement, to which Plaintiff agreed when filling out the

There is a split of authority on the issue, but judges within the District of Nebraska
have held that motions to arbitrate are non-dispositive and can be ruled on by a
magistrate judge. See All. Grp., Inc. v. Zurich Am. Ins. Co., No. 8:21CV188, 2021
WL 5325883, at *1 (D. Neb. Nov. 16, 2021) (“This Court agrees with those courts
holding that ‘a motion to compel arbitration is a non-dispositive motion’ and can be
decided by a magistrate judge.”).

1

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application for the credit card, was enclosed with the notice. Filing No. 13-3.
Relevant provisions of this agreement are set forth below:
This Agreement is binding on you unless you close your accounts
within 30 days after receiving the card and you have not used or
authorized use of the card.
Filing No. 13-3 at 1.
We may change the . . . terms of this Agreement from time to time as
permitted by law. The changes may add, replace, or remove
provisions of this Agreement. We will give you advance written notice
of the changes and a right to opt out to the extent required by law.
Filing No. 13-3 at 3.
ARBITRATION
PLEASE READ THIS PROVISION OF THE AGREEMENT
CAREFULLY. IT PROVIDES THAT ANY DISPUTE MAY BE
RESOLVED BY BINDING ARBITRATION.
...
Agreement to Arbitrate: Either you or we may, without the other’s
consent, elect mandatory, binding arbitration for any claim, dispute or
controversy between you and us (called “Claims”).
Claims Covered
What Claims are subject to arbitration? All Claims relating to your
account, a prior related account, or our relationship are subject to
arbitration, including Claims regarding the application, enforceability,
or interpretation of this Agreement and this arbitration provision. All
Claims are subject to arbitration no matter what legal theory they are
based on or what remedy (damages, or injunctive or declaratory relief)
they seek. This includes Claims based on contract, tort (including
intentional tort), fraud, agency, your or our negligence, statutory or
regulatory provisions, or any other sources of law;
...
Whose Claims are subject to arbitration? Not only ours and yours, but
also Claims made by or against anyone connected with us or you or
claiming through us or you, such as a co-applicant or authorized user
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of your account, an employee, agent, representative, affiliated
company, predecessor or successor, heir, assignee, or trustee in
bankruptcy.
...
Broadest interpretation. Any questions about whether Claims are
subject to arbitration shall be resolved by interpreting this arbitration
provision in the broadest way the law will allow it to be enforced.
...
Filing No. 13-3 at 4.
On October 18, 2016, Citibank sent a letter to Plaintiff regarding updates to
the card agreement. Filing No. 13-4. The letter referenced the account ending in
4020. Filing No. 13-4. This letter stated Plaintiff had “the choice to reject the
arbitration provision” and, in order to do so, needed to send a “rejection letter” to
Citibank on or before December 22, 2016. Filing No. 13-4 at 1. The parties agree
that Plaintiff did not send Citibank a rejection letter.
Updates to the credit card agreement provided in October 2016 include the
following:
ARBITRATION
PLEASE READ THIS PROVISION OF THE AGREEMENT
CAREFULLY.
This section provides that disputes may be resolved by binding
arbitration . . . This arbitration provision is governed by the Federal
Arbitration Act (FAA) and shall be interpreted in the broadest way the
law will allow.
Covered claims
o You or we may arbitrate any claim, dispute or controversy
between you and us arising out of or related to your Account, a
previous related account or our relationship (called “Claims”).
o If arbitration is chosen by any party; neither you nor we will have
the right to litigate that Claim in court or have a jury trial on that
Claim.
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Except as stated below; all Claims are subject to arbitration, no matter
what legal theory they’re based on or what remedy (damages, or
injunctive or declaratory relief) they seek, including Claims based on
contract, tort (including intentional tort), fraud, agency, your or our
negligence, statutory or regulatory provisions, or any other sources of
law . . . This also includes Claims made by or against anyone
connected with us or you or claiming through us or you, or by
someone making a claim through us or you . . .
Filing No. 13-4 at 15.
Plaintiff continued to use the Credit Card to make purchases and payments
after December 22, 2016. Filing No. 13-5.
Citibank underwent a conversion which changed Plaintiff’s account number
in April 2020. Filing No. 21-1 at 2. Despite the change in account number, Citibank
attests the credit card remained the Citi/AAdvantage Executive World Mastercard
and was a continuation of the account originally ending in 4020. Filing No. 21-1 at
3.
Plaintiff has set forth no evidence that an agreement, other than one
submitted by Citibank governs and, further, sets forth no evidence that she is not,
in fact, bound by the agreements submitted by Citibank.
On August 19, 2024, Plaintiff filed the complaint alleging claims against
Citibank regarding violations of the Fair Debt Credit Reporting Act and the Fair
Credit Report Act. Filing No. 1. Plaintiff also makes claims against LVNV Funding,
LLC, (“LVNV”) who she alleges is a debt collector. LVNV filed an answer on
October 18, 2024. Filing No. 7. LVNV has not taken a position regarding the
pending motion.

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ANALYSIS
I.

Standard of Review
In deciding a motion to compel arbitration where the parties rely on matters

outside the pleadings, the Court applies a standard akin to summary judgment.
Tinder v. Pinkerton Security, 305 F.3d 728, 735 (7th Cir. 2002) (“The FAA does
not expressly identify the evidentiary standard a party seeking to avoid compelled
arbitration must meet. But courts that have addressed the question have
analogized the standard to that required of a party opposing summary judgment
under Rule 56(e) of the Federal Rules of Civil Procedure.”); see also Seldin v.
Seldin, 879 F.3d 269, 272 (8th Cir. 2018). Therefore, the Court will “view[] the
evidence in the light most favorable to the nonmoving party” and grant the motion
if “‘there is no genuine dispute as to any material fact and . . . the movant is entitled
to judgment as a matter of law.’” DeLuna v. Mower Cty., 936 F.3d 711, 716 (8th
Cir. 2019) (quoting Brunsting v. Lutsen Mountains Corp., 601 F.3d 813, 820 (8th
Cir. 2010).
The nonmoving party “receives the benefit of all reasonable inferences
supported by the evidence but has the ‘obligation to come forward with specific
facts showing that there is a genuine issue for trial.’” Atkinson v. City of Mt. View,
Mo., 709 F.3d 1201, 1207 (8th Cir. 2013) (quoting Dahl v. Rice Cty., Minn., 621
F.3d 740, 743 (8th Cir. 2010)). “Where the record taken as a whole could not lead
a rational trier of fact to find for the nonmoving party, there is no genuine issue for
trial.” Ricci v. DeStefano, 557 U.S. 557, 586 (2009).
II.

Agreement to Arbitrate
A. Undisputed Evidence
The present dispute before the Court is whether the agreements submitted

by Citibank are, in fact, the current agreement between the parties. Plaintiff has
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submitted no evidence that an agreement other than the agreements submitted by
Citibank govern their relationship. Plaintiff also did not submit evidence
demonstrating she did not agree to the terms of the aforementioned agreements
or that she rejected the arbitration provision in the updated agreement provided by
Citibank.
Rather, Plaintiff’s primary argument in opposition to the pending motion is
that Citibank’s evidence contains insufficiencies and, as such, Citibank has failed
to fulfill its burden. Namely, Plaintiff argues Citibank’s conversion of American
Airlines branded products “in an effort to offer additional benefits”, in conjunction
with the differing account numbers, shows the agreements in evidence are not the
governing agreements (and thus there is no evidence of a binding arbitration
provision). Plaintiff also argues that, pursuant to 12 C.F.R. § 1026.6 (“Regulation
Z”), Citibank was required to send a new account agreement out when the
“additional benefits” were provided. Filing No. 25 at 3.
The undersigned will first address Plaintiff’s burden argument. As mentioned
above, the standard on a motion to compel arbitration is akin to a motion for
summary judgment. While it is true that the movant has the initial burden, that
burden can be may be discharged by ‘showing’ ... that there is an absence of
evidence to support the nonmoving party's case. St. Jude Med., Inc. v. Lifecare
Int'l, Inc., 250 F.3d 587, 596 (8th Cir. 2001) (quoting Celotex Corp. v. Catrett, 477
U.S. 317, 325 (1986)). The Eighth Circuit has further held that, in order “[t]o survive
summary judgment, a plaintiff ‘must substantiate his allegations with sufficient
probative evidence that would permit a finding in his favor on more than mere
speculation, conjecture, or fantasy.’” Rickard v. Swedish Match North America,
Inc., 773 F.3d 181, 184 (8th Cir. 2014) (quoting Moody v. St. Charles Cnty., 23
F.3d 1410, 1412 (8th Cir. 1994) (quoting Gregory v. City of Rogers, 974 F.2d 1006,
1010 (8th Cir. 1992)); see also Davis v. City of Little Rock, 122 F.4th 326, 329 (8th
Cir. 2024) (“This Court does not ‘accept unreasonable inferences or sheer
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speculation as fact.’”). “‘The nonmovant must do more than simply show that there
is some metaphysical doubt as to the material facts, and must come forward with
specific facts showing that there is a genuine issue for trial.’” Davis, 122 F.4th at
332 (quoting Torgerson v. City of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011)).
Citibank has provided the Court with undisputed evidence of both an original
and updated agreement between Plaintiff and Citibank. Citibank has also provided
the Court with undisputed evidence indicating these agreements govern the
relationship. As mentioned above, Plaintiff has provided no evidence indicating
there is a different agreement that governs the relationship between the parties
and, further, no evidence that she rejected the arbitration agreement. The
undersigned recognizes the account numbers of Plaintiff’s credit card has
changed. However, Citibank submitted evidence explaining that discrepancy,
which Plaintiff disputes with only hypothetical questions and speculation. The
hypothetical questions and speculation concerning the evidence are not enough.
See Rickard, 773 F.3d at 186 (dismissing various claims at the summary judgment
stage when the plaintiff’s evidence consisted solely of his own conjecture and
speculation); Davis, 122 F.4th at 331 (dismissing claim finding that speculation did
not show a violation).
Next Plaintiff argues that, because Regulation Z requires a new account
agreement to be sent in certain circumstances, Citibank’s change to the “additional
benefits” would result in a new agreement. Plaintiff contends this is enough to
question whether the agreements provided in evidence do, in fact, govern their
relationship. Title 12 C.F.R. Section 1026.9(b)(2) states:
. . . whenever a credit feature is added or a credit access device
is mailed or delivered to the consumer, and the finance charge
terms for the feature or device differ from disclosures
previously given, the disclosures required by 1026.6(a)(1) or
(b)(3)ii)(A), as applicable, that are applicable to the added
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feature or device shall be given before the consumer uses the
feature or device for the first time.
Here, there is no evidence indicating Citibank made any changes to the finance
charge terms of the Account. In fact, Citibank’s evidence indicates Plaintiff’s
account remained “unchanged”, other than the identifying numbers associated
with the Account, which was done in order to provide accountholders with
additional “benefits.” Again, Plaintiff has not offered evidence indicating a new
agreement was sent and that such agreement governs the parties’ relationship.
B. Validity and Scope of Agreement
The FAA provides “[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. This provision reflects “a liberal federal policy
favoring arbitration agreements, notwithstanding any state substantive or
procedural policies to the contrary.” Moses H. Cone Mem'l Hosp. v. Mercury
Constr. Corp., 460 U.S. 1, 24 (1983). The plain language of the agreements and
evidence before the court indicates the agreements involves a transaction
involving commerce.
In reviewing a motion to compel arbitration, the Court must determine “(1)
whether there is a valid arbitration agreement and (2) whether the particular
dispute falls within the terms of that agreement.” Robinson v. EOR-ARK, LLC, 841
F.3d 781, 783-84 (8th Cir. 2016) (quoting Faber v. Menard, Inc., 367 F.3d 1048,
1052 (8th Cir. 2004)). The Court must grant a petition to compel arbitration “if a
valid arbitration clause exists which encompasses the dispute between the
parties.” 3M Co. v. Amtex Sec., Inc., 542 F.3d 1193, 1198 (8th Cir. 2008). Whether
a valid arbitration agreement exists is a question of state contract law. Donaldson
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Co., Inc. v. Burroughs Diesel, Inc., 581 F.3d 726, 731 (8th Cir. 2009). As mentioned
herein, the parties are not disputing the validity of the arbitration agreement
submitted to the Court.
The Court will briefly address the validity of the arbitration agreement.
Citibank has produced evidence that it sent Plaintiff not once, but twice,
agreements which contained arbitration provisions. The second agreement
expressly provided Plaintiff with the opportunity to opt out of the arbitration
provision and the evidence before the Court indicates Plaintiff did not opt out.
Moreover, after receiving the second agreement containing the arbitration
provision, and not opting out, Plaintiff continued to use the Credit Card. See
Schmitt v. Rausch, Sturm, Israel, Enerson & Hornik, LLP, 2022 WL 671472 (D.
Neb. March 7, 2022) (finding an agreement to arbitrate was valid when, even
though the original agreement between the company and plaintiff did not contain
an arbitration provision, the company mailed the plaintiff a modification of their
agreement, that plaintiff did not reject the arbitration clause, and plaintiff continued
to use the card after such failure to reject the arbitration clause). The Court finds
there is a valid arbitration agreement between the parties.
Despite Plaintiff’s reliance, this case is factually distinct from Cox v. Midland
Funding, LLC, No. 1:14-CV-1576-LMM-JSA, 2015 WL 12862931 (N.D. Ga. June
11, 2015). In Cox, the defendant produced no evidence affirmatively showing any
document containing an arbitration provision was sent to the plaintiff when he was
actively using the card. Id. at 8. The only evidence of an arbitration provision being
provided to plaintiff was after plaintiff had discontinued use of the credit card and
was merely paying the card’s balance. Id.
Finally, the Court considers whether the claims at issue are encompassed
by the arbitration agreement. When determining whether an arbitration agreement
encompasses a certain claim, a court must first determine “whether an arbitration
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clause is broad or narrow.” Parm, 898 F.3d at 874 (citing Unison Co. Ltd. V. Juhl
Energy Development, Inc., 789 F.3d 816, 818 (8th Cir. 2015). “If a clause is broad,
the liberal federal policy favoring arbitration agreements requires that a district
court send a claim to arbitration as long as the underlying factual allegations simply
touch matters covered by the arbitration provision.” Parm, 898 F.3d at 874 (internal
citations and quotes omitted).
When an arbitration provision covers claims “arising out of” or “relating to”
an agreement, such arbitration clause is broad. Parm, 898 F.3d at 874. Both
arbitration agreements state they are to be construed in “the broadest way the law
will allow.” Filing No. 13-3 at 4; Filing No. 13-4 at 3. This, along with the indication
that the arbitration clause covers “any claim . . . arising out of or related to . . .”
indicates the arbitration provision at issue is broad. Plaintiff alleged Citibank
violated the Fair Debt Credit Reporting Act and Fair Credit Report Act. The
allegations in the complaint also make clear that these alleged violations relate to
a current or former account Plaintiff held with Citibank. The allegations in the
Complaint clearly “touch” the matters covered by both arbitration provisions and
the undersigned finds it appropriate to compel Plaintiff’s claims against Citibank to
arbitration.
III.

LVNV Funding, Inc.
Arbitration under the FAA “is a matter of contract and a party cannot be

required to submit to arbitration any dispute which he had not agreed to submit.”
AT&T Techs., Inc. & Commc’ns Workers, 475 U.S. 643, 648 (1986). A nonsignatory cannot be forced into arbitration unless there is some evidence that the
non-signatory consented to arbitration. Flink v. Carlson, 856 F.2d 44, 46 (8th Cir.
1988). There is no indication that LVNV was a party to the arbitration agreement
and they do not move to compel arbitration. Given that the claims against LVNV
will remain before the Court, the Court must determine whether to stay their claims
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or allow them to proceed normally. J.B. Hunt Transport, Inc. v. Steadfast Ins. Co.,
470 F.Supp.3d 936 (W.D. Ark. 2020). “[T]he power to stay proceedings is
incidental to the power inherent in every court to control the disposition of the
causes on its docket with economy of time and effort for itself, for counsel, and for
litigants.” Landis v. N. Am. Co., 299 U.S. 248, 254 (1936). The Eighth Circuit has
found that it “makes eminent sense” to stay proceedings involving third parties to
an arbitration agreement “when the third-party litigation involves common
questions of fact that are within the scope of the arbitration agreement.”
Contracting Nw., Inc. v. City of Fredericksburg, 713 F.2d 382, 387 (8th Cir. 1983).
To determine whether to expand a stay to nonarbitrable claims pending the
completion of arbitration, courts weigh three factors: (1) the risk of inconsistent
rulings; (2) the extent to which the parties will be bound by the arbitrator’s decision;
and (3) the prejudice that may result from delay. AgGrow Oils, L.L.C. v. Nat’l Union
Fire Ins. Co., 242 F.3d 777, 783 (8th Cir. 2001).
The legal and factual issues underlying the claims against LVNV overlap
substantially with those underlying the claims against Citibank. Both the plaintiffs’
claims against LVNV and Citibank revolve around whether Citibank accurately
assessed their credit report and whether LVNV reasonably used that credit report
to collect debts. The Court finds Plaintiff’s claims against LVNV and Citibank
contain common questions of fact. It is very likely that a ruling from the arbitrator
on the dispute between Plaintiff and Citibank will impact the outcome of litigation
between Plaintiff and LVNV. Judicial resources would be best conserved by
staying this matter in its entirety. Thus, the Court will stay the entirety of these
proceedings pending the results of the arbitration between Plaintiff and Citibank.
For the reasons set forth herein,
IT IS SO ORDERED:

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1. Defendant’s Motion to Compel Arbitration Filing No. 11 is granted.
Plaintiff and Citibank are directed to proceed to arbitration in accordance
with the terms of their agreement.
2. This case, including claims against LVNV Funding, LLC, is stayed
pending the outcome of Plaintiff and Citibank’s arbitration.
3. Plaintiff and Citibank shall file a joint status report regarding the progress
of arbitration every ninety (90) days beginning June 3, 2025.
4. The Clerk of the court is directed to set an initial status report deadline of
June 3, 2025.
Dated this 5th day of March, 2025.
BY THE COURT:
s/ Jacqueline M. DeLuca
United States Magistrate Judge

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