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Lester v. Portfolio Recovery Associates LLC

United States District Court, N.D. Alabama, Eastern Division

July 11, 2018




         This civil action was originally filed on February 16, 2018, in the Circuit Court of Calhoun County, Alabama by the Plaintiff, William Lester, Jr., against the Defendant, Portfolio Recovery Associates, LLC (“PRA”). (Doc. 1-1 at 7). The Complaint primarily alleges that the Defendant violated various provisions of the Fair Credit Reporting Act, 15 U.S.C. §§ 1681-1681x (the “FCRA”) (Count One) and the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692-1692p (the “FDCPA”) (Counts Two through Eight). In addition, the Complaint alleges the Alabama state law claims of: Invasion of Privacy (Count Nine); “Negligent, Wanton, [and/or] Intentional Hiring, Training and Supervision of Incompetent Debt Collectors” (Count Ten); and “Negligence, [Wantonness]/[Intentional]/Malicious Conduct” (Count Eleven). The case was removed to this Court on February 16, 2018. (Doc. 1).

         The case comes before the Court on PRA's “Motion To Stay or Dismiss Proceedings and Compel Arbitration” (the “Motion”). (Doc. 16). The Motion has been fully briefed and was the subject of a hearing held on June 20, 2018. For the reasons stated at the hearing and herein, the Motion will be DENIED.

         I. STANDARD

         The Federal Arbitration Act, 9 U.S.C. §§1-307 (the “FAA”) provides:

A party aggrieved by the alleged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration may petition any United States district court which, save for such agreement, would have jurisdiction under title 28, in a civil action or in admiralty of the subject matter of a suit arising out of the controversy between the parties, for an order directing that such arbitration proceed in the manner provided for in such agreement.

9 U.S.C.A. § 4. In the instant case, the dispute is about whether the parties to this action, PRA and Lester, agreed to arbitrate the claims in this case. The Eleventh Circuit has held that

[w]hether a party has agreed to arbitrate an issue is a matter of contract law and interpretation. See Doe v. Princess Cruise Lines, Ltd., 657 F.3d 1204, 1208 (11th Cir. 2011). “[I]t is the language of the contract that defines the scope of disputes subject to arbitration.” E.E.O.C. v. Waffle House, Inc., 534 U.S. 279, 289, 122 S.Ct. 754, 151 L.Ed.2d 755 (2002). “[N]othing in the [Federal Arbitration Act] authorizes a court to compel arbitration of any issues, or by any parties, that are not already covered in the agreement.” Id.

Gamble v. New England Auto Fin., Inc., No. 17-15343, 2018 WL 2446607, at *1 (11th Cir. May 31, 2018).

Further, in addressing the underlying question of whether parties have a valid arbitration agreement, no presumption in favor of arbitration applies. . . . Rather, the well-recognized national policy favoring arbitration comes into play later, when addressing whether a particular claim is covered by an otherwise valid and enforceable arbitration agreement.

Dasher v. RBC Bank (USA), 882 F.3d 1017, 1022-23 (11th Cir. 2018) (citations omitted). Instead, the Eleventh Circuit has stated:

We agree with our sister circuits that a summary judgment-like standard is appropriate and hold that a district court may conclude as a matter of law that parties did or did not enter into an arbitration agreement only if “there is no genuine dispute as to any material fact” concerning the formation of such an agreement. Fed.R.Civ.P. 56(a). A dispute is not “ ‘genuine' if it is unsupported by the evidence or is created by evidence that is ‘merely colorable' or ‘not significantly probative.' ” Baloco v. Drummond Co., 767 F.3d 1229, 1246 (11th Cir. 2014) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986)), cert. denied, __ U.S. __, 136 S.Ct. 410, 193 L.Ed.2d 317 (2015). “This court has consistently held that conclusory allegations without specific supporting facts have no probative value” for a party resisting summary judgment. See Leigh v. Warner Bros., 212 F.3d 1210, 1217 (11th Cir. 2000) (quotation marks omitted).

Bazemore v. Jefferson Capital Sys., LLC, 827 F.3d 1325, 1333 (11th Cir. 2016).

         I. BACKGROUND

         Some time prior to June 2016, William Lester incurred debt on a Lowes Home Improvement (“Lowes”) credit card with an account ending in numbers -4658 (the “Account”). The card was issued by Synchrony Bank (“Synchrony”), as successor in interest to GE Capital Retail Bank (“GE”).

         The credit card and cardholder agreement for the account (the “Agreement”) contained two provisions relevant to the instant motion. The first, the Arbitration Provision, provides, in pertinent part:

- What claims are subject to arbitration
1. If either you or we make a demand for arbitration, you and we must arbitrate any dispute or claim between you or any other user of your account, and us, our affiliates, agents and/or Lowe's Companies, Inc., if it relates to your account, except as noted below.
2. We will not require you to arbitrate: (1) any individual case in small claims court . . ., so long as it remains an individual case in that court; or (2) a case we file to collect money you owe us. However, if you respond to the collection lawsuit by claiming any wrongdoing, we may require you to arbitrate.
3. Notwithstanding any other language in this section, only a court, not an arbitrator, will decide disputes about the validity, enforceability, coverage or scope of this section or any part thereof . . . . However, any dispute or argument that concerns the validity or enforceability of the Agreement as a whole is for the arbitrator, not a court, to decide.
- Governing Law for Arbitration
This Arbitration section of your Agreement is governed by the Federal Arbitration Act (FAA). Utah law shall apply to the extent ...

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