Ohanian et al v. Apple Inc. et al

Filing 52

OPINION AND ORDER re: 33 MOTION to Compel Arbitration and Stay the Case. filed by Apple Inc. For the foregoing reasons, decision is RESERVED on Defendants' motions to compel arbitration of Ohanian's claims pending further proceedings, and Apple's motion to compel arbitration of Lopez's claims is DENIED. By March 16, 2021, the parties shall meet and confer and file a joint letter explaining how they would like to proceed to resolve the factual issue. The Clerk of Court is respectfully directed to close Dkt. No. 33. (As further set forth in this Order.) (Signed by Judge Lorna G. Schofield on 3/9/2021) (cf)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-------------------------------------------------------------X
:
TIGRAN OHANIAN, et al.,
:
Plaintiffs, :
:
:
-against:
APPLE INC., et al.,
:
Defendants. :
------------------------------------------------------------ X

20 Civ. 5162 (LGS)
OPINION & ORDER

LORNA G. SCHOFIELD, District Judge:
Plaintiffs Tigran Ohanian and Regge Lopez bring this putative class action against
Defendants T-Mobile USA, Inc. (“T-Mobile”) and Apple, Inc. (“Apple”), alleging violations of
New York General Business Law (“N.Y. GBL”) sections 349 and 350, fraudulent
misrepresentation and unjust enrichment. Defendants filed motions to compel arbitration.
Decision is reserved on Defendants’ motions to compel arbitration of Ohanian’s claims pending
further proceedings. Apple’s motion to compel arbitration of Lopez’s claims is denied.
BACKGROUND
The following facts relevant to the current motions are drawn from the Complaint,
exhibits and declarations submitted in this case.
Ohanian and Lopez are T-Mobile customers. On April 19, 2016, Ohanian activated a
prepaid line of service with T-Mobile and purchased a subscriber information module card
(“SIM card”), which provided a phone number for use in his iPhone 6. The phone automatically
linked Ohanian’s Apple ID with the phone number, and Ohanian used the number for about one
year. On January 16, 2017, Lopez also activated a prepaid line of service with T-Mobile, and TMobile installed a SIM card on his phone, providing the same phone number previously given to
Ohanian. Lopez’s phone also associated the phone number with Lopez’s Apple account.

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Ohanian subsequently received unwanted iMessages and FaceTime calls, intended for Lopez, the
new user of the phone number.
At the time Ohanian and Lopez opened their T-Mobile accounts, T-Mobile’s practice was
to provide prepaid customers with a Prepaid Service Confirmation Form (the “Form”). The
Form provided to Lopez informed him that by activating or using T-Mobile’s services, he was
accepting T-Mobile’s Terms and Conditions (“T&Cs”) and also that T-Mobile requires
arbitration of disputes:
By activating or using T-Mobile service, you accept T-Mobile’s Terms and
Conditions. T-Mobile requires Arbitration of Disputes unless you opt-out
within 30-days of activation. If you fail to activate service within 30 days from
purchase, this will also be considered acceptance of T-Mobile’s Terms and
Conditions. For details see T-Mobile’s Terms and Conditions at www.TMobile.com/terms-conditions or www.T-Mobilepr.com for Puerto Rico
customers.
See Declaration of Christopher Muzio (“Muzio Decl.”), Ex. C, at Dkt. No. 32 (emphasis in
original). Ohanian asserts that the only document he received in connection with his transaction
was a receipt. He denies receiving the Form accompanying his service plan or being informed of
any T&Cs.
Ohanian’s receipt describes the items purchased in his April 2016 transaction. At the
bottom of the first page are lengthy paragraphs, providing additional information about prepaid
services, plan features and data plans. The paragraph beginning with “Prepaid Services” refers
to the T&Cs in the final sentence as below:
Prepaid Services. Requires an active T-Mobile Account. Pricing and plans
subject to change at any time without notice, and may have changed prior to
purchase of refill card. T-Mobile No Annual Contract (prepaid) service is
available for 90 days following Activation of this refill. Different terms apply to
FlexPay and prepaid Mobile Broadband service; see plans for details. Data
roaming not available for prepaid plans. Partial minutes rounded up for billing;
data usage rounded up to nearest KB each use. No cash redemption value. Non-

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refundable. Not responsible if lost or stolen. See brochures and T-Mobile Terms
and Conditions at T-Mobile.com for details.
See Muzio Decl., Ex. A.
T-Mobile asserts that different versions of the T&Cs applied to each Plaintiff and at
various times. Each version includes the same arbitration provision:
YOU AND WE EACH AGREE THAT, EXCEPT AS PROVIDED
BELOW . . . ANY AND ALL CLAIMS OR DISPUTES IN ANY WAY
RELATED TO OR CONCERNING THE AGREEMENT, OUR PRIVACY
POLICY, OUR SERVICES, DEVICES OR PRODUCTS, INCLUDING
ANY BILLING DISPUTES, WILL BE RESOLVED BY BINDING
ARBITRATON OR IN SMALL CLAIMS COURT. This includes any claims
against other parties relating to Services or Devices provided or billed to you
(such as our suppliers, dealers, authorized retailers, or third party vendors)
whenever you also assert claims against us in the same proceeding.
See Muzio Decl., Ex. I-K (emphasis in original). The T&Cs also have a governing law
provision, which states, “This Agreement is governed by the Federal Arbitration Act, applicable
federal law, and the laws of the state in which your billing address in our records is located,
without regard to the conflicts of laws rules of that state.” Ohanian provided an international
billing address; Lopez’s billing address in T-Mobile’s records is in Florida.
Ohanian and Lopez allege that T-Mobile and Apple engaged in false, deceptive and
materially misleading consumer-oriented conduct concerning T-Mobile SIM cards and privacy
features of Apple iPhones. The Complaint separately asserts claims against each of T-Mobile
and Apple for violations of N.Y. GBL sections 349 and 350, fraudulent misrepresentation, and
unjust enrichment. As to T-Mobile, the Complaint alleges that it deceived consumers by “failing
to disclose that its practice of recycling phone numbers linked to SIM cards, and selling those
SIM cards to consumers without requiring prior users to manually disassociate their Apple IDs
from the phone numbers associated with the recycled SIM cards, did not protect the privacy of
users’ data and confidential personal information.” As to Apple, the Complaint alleges that

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Apple represented that the iPhone was designed to protect the privacy of users’ data but failed to
disclose the “significant security flaw in the Apple iOS software . . . known only to Apple that
allowed iMessage correspondence sent by iPhone users and FaceTime calls made by iPhone
users to be improperly directed to and accessed by third parties.”
T-Mobile and Apple moved to compel arbitration of the claims based on the arbitration
provision contained in T-Mobile’s T&Cs. After Defendants filed their motions, Lopez filed a
notice of voluntary dismissal, dismissing his claims against T-Mobile.
LEGAL STANDARD
When deciding motions to compel arbitration, courts apply a “standard similar to the one
applicable to a motion for summary judgment.” Starke v. SquareTrade, Inc., 913 F.3d 279, 281
n.1 (2d Cir. 2019) (citation omitted). That is, courts consider “all relevant, admissible evidence
submitted by the parties” and must “draw[] all reasonable inferences in favor of the non-moving
party.” Id. (citing Nicosia v. Amazon.com, Inc., 834 F.3d 220, 229 (2d Cir. 2016)). Courts,
rather than arbitrators, must decide whether parties have agreed to arbitrate “unless the parties
clearly and unmistakably provide otherwise.” Nicosia, 834 F.3d at 229. “Where the undisputed
facts in the record require the matter of arbitrability to be decided against one side or the other as
a matter of law, we may rule on the basis of that legal issue and avoid the need for further court
proceedings.” Starke, 913 F.3d at 288. However, “[i]f there is an issue of fact as to the making
of the agreement for arbitration, then a trial is necessary.” Nicosia, 834 F.3d at 229; see 9 U.S.C.
§ 4 (“If the making of the arbitration agreement . . . be in issue, the court shall proceed
summarily to the trial thereof.”). The party challenging the existence of an agreement must
make “an unequivocal denial that the agreement had been made . . . and some evidence should
[be] produced to substantiate the denial.” Interocean Shipping Co. v. Nat’l Shipping & Trading

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Corp., 462 F.2d 673, 676 (2d Cir. 1972); accord Mobile Real Est., LLC v. NewPoint Media Grp.,
LLC, 460 F. Supp. 3d 457, 471 (S.D.N.Y. 2020).
The Federal Arbitration Act (“FAA”) was enacted to counteract “widespread judicial
hostility to arbitration agreements.” AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339
(2011). The FAA reflects “both a liberal federal policy favoring arbitration and the fundamental
principle that arbitration is a matter of contract.” Id.; accord Dr.’s Assocs., Inc. v. Alemayehu,
934 F.3d 245, 250 (2d Cir. 2019). “[A] court may order arbitration of a particular dispute only
where the court is satisfied that the parties agreed to arbitrate that dispute.” Granite Rock Co. v.
Int’l Brotherhood of Teamsters, 561 U.S. 287, 297 (2010) (emphasis in original). Accordingly,
when considering a motion to compel arbitration, courts must determine: (1) whether the parties
agreed to arbitrate, and if so, (2) whether the scope of that agreement encompasses the claims at
issue. See Daly v. Citigroup Inc., 939 F.3d 415, 421 (2d Cir. 2019), cert. denied, 140 S. Ct. 1117
(2020). Where a party brings a challenge to the very formation of a contract containing an
agreement to arbitrate, the court must resolve that challenge to determine whether to compel
arbitration, see Granite Rock Co., 561 U.S at 296-97, and apply state contract law principles, see
id. at 296; Nicosia, 834 F.3d at 229. State law governs whether a nonsignatory may enforce an
arbitration clause. See Arthur Andersen LLP v. Carlisle, 556 U.S. 624, 630-31 (2009).
DISCUSSION
Decision is reserved on Defendants’ motions to compel arbitration of Ohanian’s claims
pending resolution of the issue of whether Ohanian agreed to arbitrate with T-Mobile. Apple’s
motion to compel arbitration of Lopez’s claims is denied.

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A.

Ohanian and T-Mobile

Ohanian has sufficiently raised an issue of fact as to whether he agreed to arbitrate with
T-Mobile, requiring further proceedings to resolve the motions as to Ohanian’s claims. Under
New York law, 1 the party seeking arbitration bears the burden of proving that a valid agreement
to arbitrate exists by a preponderance of evidence. See Progressive Cas. Ins. Co. v. C.A.
Reaseguradora Nacional De Venezuela, 991 F.2d 42, 46 (2d Cir. 1993) (applying New York
law); Solis v. ZEP LLC, No. 19 Civ. 4230, 2020 WL 1439744, at *4 (S.D.N.Y. Mar. 24, 2020).
To be binding, a contract requires a “meeting of the minds” and “a manifestation of mutual
assent.” Starke, 913 F.3d at 288-89 (quoting Express Indus. & Terminal Corp. v. N.Y. Dep’t of
Transp., 715 N.E.2d 1050 (N.Y. 1999)). “The manifestation of mutual assent must be
sufficiently definite to assure that the parties are truly in agreement with respect to all material
terms.” Id. at 289 (citing Joseph Martin, Jr., Delicatessen, Inc. v. Schumacher, 417 N.E.2d 541
(N.Y. 1981)). To determine whether there was an objective meeting of the minds, courts look to
the elements of offer and acceptance. See id. (citing Indus. & Terminal Corp., 715 N.E.2d
1050). “Where an offeree does not have actual notice of certain contract terms, he is
nevertheless bound by such terms if he is on inquiry notice of them and assents to them through
conduct that a reasonable person would understand to constitute assent.” Id.
T-Mobile contends that the Form provided Ohanian notice of the T&Cs, including the
arbitration provision, and that Ohanian accepted those contractual terms when he purchased the
T-Mobile SIM card and activated his line of service. The Form clearly states that use of T-

1

The parties’ memoranda of law assume that New York substantive law governs the relationship
between Ohanian and T-Mobile, which is sufficient to establish the applicable choice of law.
See Arch Ins. Co. v. Precision Stone, Inc., 584 F.3d 33, 39 (2d Cir. 2009); PetEdge, Inc. v. Garg,
234 F. Supp. 3d 477, 486 (S.D.N.Y. 2017).
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Mobile’s services would be considered acceptance of T-Mobile’s T&Cs and that T-Mobile
requires arbitration of disputes. T-Mobile relies on the Declaration of T-Mobile’s custodian of
records Christopher Muzio to establish that the Form would have been provided to Ohanian.
However, there is an issue of fact as to whether Ohanian actually received the Form. Plaintiff
attests that at the time of his purchase, he received only a receipt and did not receive the Form or
any information indicating that he was accepting or agreeing to the T&Cs. Contrary to TMobile’s contentions, Ohanian’s “unequivocal denial” that he did not agree to arbitrate is
supported by “some evidence,” sufficient to warrant a trial under 9 U.S.C. § 4. See Interocean
Shipping Co., 462 F.2d at 676. T-Mobile argues that Ohanian’s affidavit is insufficient to raise a
triable issue of fact because it is self-serving and his statement that his receipt did not refer to the
T&C’s is contradicted by the record. These arguments are unpersuasive. “[A] plaintiff may not
rely on a self-serving declaration to create a justiciable issue where none otherwise exists.”
Shron v. LendingClub Corp., No. 19 Civ. 6718, 2020 WL 3960249, at *4 (S.D.N.Y. July 13,
2020); see New World Sols., Inc. v. NameMedia Inc., 150 F. Supp. 3d 287, 326 (S.D.N.Y. 2015)
(“[U]nsubstantiated and self-serving testimony is insufficient, without more,” to create a genuine
issue of material fact.). Still, because Ohanian “raise[s] an important question of notice,” his
declaration cannot be easily disregarded. See Shron, 2020 WL 3960249, at *4. Viewed in the
light most favorable to Ohanian, the sworn denial is sufficient to create a genuine issue of fact.
Ohanian’s testimony is colorable because he recalls in detail what he received with his purchase,
and his denial is not wholly unsubstantiated. The Form that T-Mobile asserts “would have” been
provided to Ohanian contains no information identifying the recipient. (By contrast, Lopez’s
Form, also attached to the Muzio Declaration, includes a phone number traceable to Lopez.)
Furthermore, and bearing in mind that it is T-Mobile’s burden to prove the existence of an

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agreement to arbitrate, T-Mobile’s testimony does not necessarily lead to the conclusion that
Ohanian’s denial is incredible. T-Mobile attests to a “regular practice and procedure” of
requiring customers to agree to the T&Cs when they activate a line of service; but T-Mobile has
not offered evidence to show that Ohanian could not have gotten T-Mobile service without such
an agreement. See Greenberg v. Ameriprise Fin. Servs., Inc., No. 15 Civ. 3589, 2016 WL
3526025, at *5 (E.D.N.Y. Mar. 31, 2016) (a plaintiff’s general denial of an agreement to
arbitrate, unsupported by any sworn declaration, was insufficient where the agreement was a
“pre-condition” to the plaintiff’s registration with an organization, which was undisputed by the
parties). Ohanian’s allegedly contradictory statement that his receipt did not reference the T&Cs
does not discredit Ohanian’s unrelated statement that he did not receive the Form during the
transaction.
T-Mobile contends that the receipt alone, which Ohanian admittedly received, is
sufficient to find that he agreed to arbitrate pursuant to the T&Cs. The receipt refers to the
T&Cs and the T-Mobile website. However, in contrast to the cases on which T-Mobile relies,
the unsigned receipt plainly is not a written contract which by its terms “incorporates by
reference” the T&Cs.
In the absence of a written agreement between Ohanian and T-Mobile, the remaining
question is whether Ohanian was on inquiry notice of the T&Cs, containing the arbitration
provision, to which he then “assented” by use of the T-Mobile services. A person can assent to
terms even if she does not actually read them, but the “offer [must nonetheless] make clear to [a
reasonable] consumer” both that terms are being presented and that they can be adopted through
the conduct that the offeror alleges constituted assent. See Schnabel v. Trilegiant Corp., 697
F.3d 110, 123 (2d Cir. 2012) (citing Specht v. Netscape Commc’ns. Corp., 306 F.3d 17, 29 (2d

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Cir. 2002) (applying California law)). 2 “In determining whether an offeree is on inquiry notice
of contract terms, New York courts look to whether the term was obvious and whether it was
called to the offeree’s attention.” Starke, 913 F.3d at 289 (citing 22 N.Y. Jur. 2d Contracts § 29).
“This often turns on whether the contract terms were presented to the offeree in a clear and
conspicuous way.” Id. “[R]eceipt of a physical document containing contract terms or notice
thereof is frequently deemed, in the world of paper transactions, a sufficient circumstance to
place the offeree on inquiry notice of those terms,” Specht, 306 F.3d at 31; however, the question
of notice is a fact-intensive inquiry, see Starke, 913 F.3d at 289 (citing e.g., Arthur Philip Export
Corp. v. Leathertone, Inc., 87 N.Y.S.2d 665, 667 (1st Dep’t 1949) (refusing to enforce contract
terms that were inconspicuously placed in “small type and in parenthesis” on the back of a
confirmation order)).
The receipt alone does not provide sufficient notice that by using T-Mobile’s services,
Ohanian was agreeing to arbitrate per the T&Cs. First, the reference to the T&Cs is
inconspicuous. The top half of the receipt includes detailed information regarding the purchased
items in varying font styles, including capitalization, bold, and underlining, and in the center of
the page is a text box advertising T-Mobile accessories in bold font. By contrast, the reference to
the T&Cs is at the bottom of the receipt, at the end of the first of several lengthy, single-spaced
paragraphs, which detail information about prepaid services, plan features and data plans in
normal typeface, size-11 font. The first paragraph begins with the heading “Prepaid Services”
and lists various attributes of prepaid plans -- e.g., “Data roaming not available for prepaid

2

New York and California apply “substantially similar rules for determining whether the parties
have mutually assented to a contract term.” Meyer v. Uber Techs., Inc., 868 F.3d 66, 74 (2d Cir.
2017).
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plans.” The list says nothing about arbitration or disputes. Following the list is the reference,
“See brochures and T-Mobile Terms and Conditions at T-Mobile.com for details.” 3
Second, this reference does not put a reasonable consumer on notice of contractual terms
or that by using T-Mobile’s service she agrees to be bound by them. An unsigned receipt does
not have obvious contractual significance, and the language of the receipt does not signal to a
reasonable consumer the acceptance of contractual terms. Instead, a reasonable consumer would
believe that she should refer to the “brochures” and the T&Cs if she wants further details
regarding attributes of prepaid services. See Meyer v. Uber Techs., Inc., 868 F.3d 66, 79 (2d Cir.
2017) (“[T]he language ‘[b]y creating an Uber account, you agree’ is a clear prompt directing
users to read the Terms and Conditions and signaling that their acceptance of the benefit of
registration would be subject to contractual terms.”); Applebaum v. Lyft, Inc., 263 F. Supp. 3d
454, 468 (S.D.N.Y. 2017) (applying New York law) (“There is . . . no reason to believe that
‘Terms of Service’ is self-defining for reasonable consumers.”). Based on the receipt alone, a
reasonable consumer would not have been on inquiry notice of the existence of contract terms
governing the consumer relationship and the conduct required to assent to such terms.
Because “there is an issue of fact as to the making of the agreement for arbitration,”
further proceedings are necessary to decide Defendants’ motion to compel arbitration of
Ohanian’s claims. See Nicosia, 834 F.3d at 229; 9 U.S.C § 4.

3

A useful comparison is the notice provided by the T-Mobile receipts accompanying Lopez’s
2018 and 2020 transactions. The first standalone paragraph in each receipt is a single sentence
that explicitly states, “If you activate or use T-Mobile service, or purchase a T-Mobile device,
you agree to T-Mobile’s Terms and Conditions and any terms specific to your rate plan.” The
third full paragraph -- beginning with a bold heading “Disputes.” -- states in all-caps that TMobile “REQUIRES ARBITRATION OF DISPUTES” and provides the website address for the
T&Cs. This clear presentation of contract terms is absent in Ohanian’s receipt.
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B.

Lopez and Non-Signatory Apple

After dismissing his claims against T-Mobile, Lopez asserts claims only against Apple.
Apple seeks to compel Lopez to arbitrate pursuant to Lopez’s agreement to arbitrate with TMobile. Apple’s motion as to Lopez’s claims is denied because Apple is not a party to the TMobile agreement, and Apple has not shown that it may enforce the agreement against Lopez.
While the federal policy favoring arbitration “requires courts to enforce the bargain of the parties
to arbitrate,” it “cannot possibly require the disregard of state law permitting arbitration
by . . . nonparties to the written arbitration agreement.” See KPMG LLP v. Cocchi, 565 U.S. 18,
21 (2011) (citations and quotation marks omitted).
State contract law determines whether a non-signatory may enforce an agreement to
arbitrate. See Arthur Andersen LLP, 556 U.S. at 629-32. Here, the parties agree that Florida law
applies per the T-Mobile choice-of-law provision. Applying Florida law, courts consistently
state that, “[o]rdinarily, a party cannot compel arbitration under an arbitration agreement to
which it was not a party,” Beck Auto Sales, Inc. v. Asbury Jax Ford, LLC, 249 So. 3d 765, 768
(Fla. Dist. Ct. App. 2018), subject to certain exceptions, including equitable estoppel. This
general rule stems from the principle that arbitration is a matter of consent, since “no party may
be forced to submit a dispute to arbitration that the party did not intend and agree to arbitrate.”
Seifert v. U.S. Home Corp., 750 So. 2d 633, 636 (Fla. 1999); accord Beck Auto Sales, Inc., 249
So. 3d at 767; 4 see also, e.g., Marcus v. Fla. Bagels, LLC, 112 So. 3d 631, 633 (Fla. Dist. Ct.

4

Judgment of an intermediate state court, “although not authoritative, . . . ‘is a datum for
ascertaining state law which is not to be disregarded by a federal court unless it is convinced by
other persuasive data that the highest court of the state would decide otherwise.’” New York v.
Nat’l Serv. Indus., Inc., 460 F.3d 201, 210 (2d Cir. 2006) (quoting West v. Am. Tel. & Tel. Co.,
311 U.S. 223, 237 (1940)).

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App. 2013) (“An obligation to arbitrate is based on consent, and for this reason a non-signatory
to a contract containing an arbitration agreement ordinarily cannot compel a signatory to submit
to arbitration.” (quotation marks omitted)). Apple asserts that Florida law allows it to enforce
the arbitration provision based on the doctrine of equitable estoppel. On reply, Apple also argues
that -- regardless of whether equitable estoppel applies -- it is entitled to compel arbitration
because Lopez consented to arbitrate claims with third parties pursuant to the terms of the
arbitration provision. Neither argument is persuasive.
The doctrine of equitable estoppel, under Florida law, does not require Lopez to arbitrate
its claim against Apple. Principles of equitable estoppel may require a signatory to an arbitration
agreement to arbitrate claims against a non-signatory in two circumstances. See Kroma Makeup
EU, LLC v. Boldface Licensing + Branding, Inc., 845 F.3d 1351, 1354 (11th Cir. 2017)
(applying Florida law). First, equitable estoppel may apply when “the signatory . . . must rely on
the terms of the written agreement in asserting its claims against the nonsignatory,” id., or in
other words, when “each of the signatory’s claims against a non-signatory make reference to or
presume the existence of a written agreement,” Armas v. Prudential Secs., Inc., 842 So. 2d 210,
212 (Fla. Dist. Ct. App. 2003); accord Physician Consortium Servs., LLC v. Molina Healthcare,
Inc., 414 F. App’x 240, 242 (11th Cir. 2011). Second, Florida’s doctrine of equitable estoppel
may apply when the claims allege “substantially interdependent and concerted misconduct” by
the signatory and the non-signatory. See Beck Auto Sales, Inc., 249 So. 3d at 767.
The Complaint neither alleges any claims against Apple that “make reference to or
presume the existence of a written agreement,” nor, in asserting the claims, “rel[ies] on the terms
of the written agreement.” The claims relate to Apple’s “failure to disclose” a “security flaw”
that “allowed iMessage correspondence sent by iPhone users and FaceTime calls made by

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iPhone users to be improperly directed to and accessed by third parties,” when a user receives a
recycled T-Mobile phone number, previously associated with a different Apple ID. Contrary to
Apple’s arguments, these claims do not “presume the existence” of any agreement merely
because the factual allegations involve the use of a T-Mobile SIM card, which may be subject to
T-Mobile’s T&C’s. No agreement between Lopez and T-Mobile is necessary for Lopez to assert
his claims against Apple. Compare, e.g., Allscripts Healthcare Sols., Inc. v. Pain Clinic of N.W.
Fla., Inc., 158 So. 3d 644, 647 (Fla. Dist. Ct. App. 2014) (“While it is certainly true that this
lawsuit would not exist but for the fact that the Doctors purchased the software licenses from the
Subsidiary, the causes of action in the Complaint are not attempts to enforce contractual rights
under the master agreements.”) with Kaplan Indus., Inc. v. Oaktree Capital Mgmt., LP, 2011 WL
5578976, at *2 (S.D. Fla. Aug. 18, 2011) (“both counts of Plaintiff’s Complaint [against nonsignatory] presume the existence of [and address violations of] the . . . Agreement, which
provided the basis for Plaintiff’s business relationship with [signatory defendant]”).
The second circumstance warranting application of equitable estoppel under Florida law - allegations of substantially interdependent and concerted misconduct by a signatory and nonsignatory -- also is not present here. Lopez’s claims against T-Mobile and Apple do not allege
any interdependent or concerted misconduct by T-Mobile and Apple. The Complaint makes
separate allegations about Apple and its conduct, including Apple’s alleged knowledge and
deliberate concealment of security breaches. The allegations referencing both Defendants
describe how Apple’s and T-Mobile’s actions independently caused harm, inadvertently
compounding the problems. See, e.g., Compl. ¶ 5 (“Apple’s failure to disclose . . . as well as TMobile’s failure to disclose . . . caused consumers . . . to become the unsuspecting victims of
extensive data security breaches” (emphasis added)); ¶ 44 (“neither Apple nor T-Mobile ever

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voluntarily disclosed to consumers”); ¶ 45 (Apple’s security flaw was “compounded” by TMobile by engaging in “deceptive SIM card practices” (emphasis added)). Lopez’s claims are
not predicated on any allegations that T-Mobile and Apple colluded or otherwise acted in
concert, even though the alleged use of Apple and T-Mobile products and services together gave
rise to the alleged misdirected iMessages or FaceTime calls. Accordingly, equitable estoppel is
not applicable here. Compare, e.g., Perdido Key Island Resort Dev., L.L.P. v. Regions Bank, 102
So. 3d 1, 6 (Fla. Dist. Ct. App. 2012) (“There is not even any allegation of ‘concerted conduct’
through which the guarantors caused the borrowers to breach their obligations under the note.
Thus, equitable estoppel is not applicable here.”), with Lash & Goldberg LLP v.Clarke, 88 So.
3d 426, 427-28 (Fla. Dist. Ct. App. 2012) (“The complaint contained allegations that the
defendants acted together,” and “generally ties [non-signatory] defendants to” signatories.), and
Kolsky v. Jackson Square, LLC, 28 So. 3d 965, 970 (Fla. Dist. Ct. App. 2010) (The “complaint
alleges a conspiracy among the signatory appellant . . . and the non-signatory appellants.”), and
Koechli v. BIP Intern., Inc., 870 So. 2d 940, 945 (Fla. Dist. Ct. App. 2004) (“[T]he facts
constituting the alleged misconduct of [matter referred to arbitration] are substantially the same
facts on which [the signatory] relies to demonstrate the alleged misconduct of [the nonsignatories] in the case before us.”).
Apple argues that, under Florida law, claims merely need to “arise” from an agreement
with a “broad” arbitration clause for equitable estoppel to apply. This is incorrect. The cited
case law reflects that courts have construed arbitration clauses to include non-signatories where
claims alleged against the non-signatories were derived from the agreements or where there was
an agency relationship between the signatory and non-signatory. See, e.g., Blinco v. Green Tree
Servicing LLC, 400 F.3d 1308, 1311-12 (11th Cir. 2005) (applying federal law, as the decision

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pre-dates Arthur Andersen LLP v. Carlisle, 556 U.S. 624 (2009)) (arbitration clause “broad
enough to permit [non-signatory] entities to invoke it,” because claims derive from the loan
servicing “relationship” that “results from” the promissory note); Sas v. Phoenix Graphics, 700
So. 2d 422, 423 (Fla. Dist. Ct. App. 1997) (arbitration clause “broad enough” where claims
against non-signatories “stem from their legal representation” of the signatories “in the making
of the underlying agreements” containing the arbitration clauses); Cuningham Hamilton Quiter,
P.A. v. B.L. of Miami, Inc., 776 So. 2d 940, 941 (Fla. Dist. Ct. App. 2000) (finding claims
“intertwined” with the contract, which mandated that “all parties necessary to resolve a claim
shall be parties to the same arbitration proceeding”); Vic Potamkin Chevrolet v. Bloom, 386 So.
2d 286, 288 (Fla. Dist. Ct. App. 1980) (arbitration clause “broad enough to include persons
within the respondeat superior doctrine”). These circumstances are not present here.
On reply, Apple argues in the alternative that it can invoke the arbitration provision
whether or not Florida’s principle of equitable estoppel applies, since Lopez “consented” to
arbitration with third parties. In support, Apple cites Arellano v. T-Mobile USA, Inc., which
interpreted the same T-Mobile arbitration provision as “evinc[ing] an intent to include claims
against third parties.” 2011 WL 1362165, at *6 (N.D. Cal. Apr. 11, 2011) (applying California
law). This case does not purport to apply Florida law, and it is not persuasive under Florida law.
The plain terms of the T-Mobile arbitration provision contain nothing that would confer third
party beneficiary rights on Apple in these circumstances. The T&Cs explain that the agreement
is between the customer and “T-Mobile USA, Inc.,” and its “controlled subsidiaries, assignees,
and agents.” See, e.g., Muzio Decl., Ex. I. The provision states that “you and we” agree to
arbitrate “any and all claims or disputes in any way related to or concerning . . . our services,
devices or products.” Id. at 6. The provision further explains that “[t]his includes any claims

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Case 1:20-cv-05162-LGS Document 52 Filed 03/09/21 Page 16 of 16

against other parties relating to Services or Devices provided or billed to you (such as our
suppliers, dealers, authorized retailers, or third party vendors) whenever you also assert claims
against us in the same proceeding.” Id. (emphasis added). Here, Apple does not contend that it
is one of T-Mobile’s “controlled subsidiaries, assignees, and agents,” and Lopez no longer
asserts claims against T-Mobile. Accordingly, because Florida’s doctrine of equitable estoppel
does not apply, Apple’s motion to compel arbitration of Lopez’s claims is denied.
CONCLUSION
For the foregoing reasons, decision is RESERVED on Defendants’ motions to compel
arbitration of Ohanian’s claims pending further proceedings, and Apple’s motion to compel
arbitration of Lopez’s claims is DENIED.
By March 16, 2021, the parties shall meet and confer and file a joint letter explaining
how they would like to proceed to resolve the factual issue.
The Clerk of Court is respectfully directed to close Dkt. No. 33.
SO ORDERED.
Dated: March 9, 2021
New York, New York

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