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Hearn v. Comcast Cable Communications, LLC

United States District Court, N.D. Georgia, Atlanta Division

October 21, 2019

MICHAEL HEARN individually and on behalf of all other similarly situated consumers, Plaintiff,


          Thomas W. Thrash Jr. United States District Judge.

         This is a class action under the Fair Credit Reporting Act. It is before the Court on Defendant Comcast Cable's Motion to Compel Individual Arbitration and Stay Litigation [Doc. 6]. For the reasons set forth below, Defendant Comcast Cable's Motion to Compel Individual Arbitration and Stay Litigation [Doc. 6] is DENIED.

         I. Background

         A. The Plaintiff's Claim

         The Plaintiff Michael Hearn alleges that he called Defendant Comcast Cable Communications to inquire about its services on or about March 5, 2019. Class Action Compl. ¶ 8. During the call, a representative for the Defendant made a “hard pull” of the Plaintiff's consumer report, damaging his credit score. Id. ¶¶ 12-14. The Plaintiff alleges that he did not consent to a credit check, was not a customer of the Defendant at the time, and did not request any services before or after the Defendant pulled his consumer report. Id. ¶¶ 9-10. The Plaintiff alleges that the Defendant obtained the Plaintiff's consumer report for an “impermissible purpose” in violation of various provisions of the Fair Credit Reporting Act, 15 U.S.C. §§ 1681 et seq. Id. ¶¶ 37-46. The Plaintiff sues on behalf of two putative classes of Georgia residents whose consumer reports were either (1) impermissibly accessed or (2) impermissibly used by the Defendant. Id. ¶ 22.

         B. The Arbitration Provision

         The Defendant argues that the Plaintiff's FCRA claim is covered by an arbitration agreement previously entered into by the parties. The Plaintiff contracted with the Defendant for services at his current address from December of 2016 through August of 2017.[1] The Plaintiff signed a work order on December 20, 2016, acknowledging receipt of a “Comcast Welcome Kit” that contained, inter alia, the 2016 Service Agreement. See 2016 Work Order, at 3. The first page of the 2016 Service Agreement notifies the customer that “THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION IN SECTION 13 THAT AFFECTS YOUR RIGHTS UNDER THIS AGREEMENT WITH RESPECT TO ALL SERVICE(S).See 2016 Service Agreement, at 1 (emphasis in original). The arbitration provision in Section 13 of the Agreement states that it is governed by the Federal Arbitration Act and covers “[a]ny Dispute involving [the customer] and Comcast.” Id. § 13(a). The provision defines the term “Dispute” as:

any claim or controversy related to Comcast, including but not limited to any and all: (1) claims for relief and theories of liability, whether based in contract, tort, fraud, negligence, statute, regulation, ordinance, or otherwise; (2) claims that arose before this or any prior Agreement; (3) claims that arise after the expiration or termination of this Agreement, and (4) claims that are currently the subject of purported class action litigation in which you are not a member of a certified class.

Id. § 13(b). The provision states that the customer has the right to opt out of arbitration by notifying the Defendant's legal department in writing within thirty days of receipt of the Agreement. Id. § 13(d).[2] The provision further states that the customer waives his or her right to arbitrate or litigate claims against the Defendant in a collective action. Id. § 13(h). Finally, the provision contains a survival clause stating that the parties' agreement to arbitrate survives termination of the Agreement. Id. § 13(k).

         The Defendant contends that the Federal Arbitration Act, 9 U.S.C. § 1 et seq., governs the arbitration provision contained within the 2016 Service Agreement and that the Plaintiff's FCRA claim falls within its broad scope. The Defendant argues that the Court should therefore stay these proceedings pending arbitration of the Plaintiff's FCRA claim. See 9 U.S.C. §§ 3-4. The Federal Arbitration Act covers any arbitration provision that is (1) in writing and (2) is part of a contract “evidencing a transaction involving [interstate] commerce.” 9 U.S.C. § 2; see also Klay v. Al Defendants, 389 F.3d 1191, 1200 n.9 (11th Cir. 2004). The Plaintiff does not dispute that the arbitration provision is in writing and that, by contracting for telecommunications services, the parties engaged in a transaction involving interstate commerce. Therefore, the Court will consider and apply precedent construing the Federal Arbitration Act in adjudicating the Defendant's motion.

         II. Legal Standard

         The Federal Arbitration Act “embodies a liberal federal policy favoring arbitration agreements.” Caley v. Gulfstream Aerospace Corp., 428 F.3d 1359, 1367 (11th Cir. 2005) (citation and punctuation omitted). Section 2 of the Federal Arbitration Act provides in relevant part that “[a] written provision in any maritime transaction or a 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. When considering a motion to compel arbitration pursuant to the Federal Arbitration Act, the Court must first “determine whether the parties agreed to arbitrate that dispute.” Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626 (1985). If they have, the Court must then determine whether the arbitration clause is valid. It may be unenforceable on grounds that would permit the revocation of any contract, such as fraud or unconscionability. See id., at 627 (“[C]ourts should remain attuned to well-supported claims that the agreement to arbitrate resulted from the sort of fraud or overwhelming economic power that would provide grounds ‘for the revocation of any contract.'”). There may also be legal constraints precluding arbitration, such as a clear congressional intention that a certain claim be heard in a judicial forum. See id., at 628 (“Having made the bargain to arbitrate, the party should be held to it unless Congress itself has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue.”).

         The Court must apply state laws of contract to resolve questions regarding the “validity, revocability, and enforceability” of arbitration agreements. Caley, 428 F.3d at 1368 (citing Perry v. Thomas, 482 U.S. 483, 492 n.9 (1987)). The Court does so, however, in light of the strong federal policy favoring arbitration. Id. (citing Cooper v. MRM Inv. Co., 367 F.3d 493, 498 (6th Cir. 2004)). “[A]s a matter of federal law, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration, whether the problem at hand is the construction of the contract language itself or an allegation of waiver, delay, or a like defense to arbitrability.” Moses H. Cone Mem'l Hosp. v. Mercury Const. Corp., 460 U.S. 1, 24-25 (1983). If the moving party establishes the necessary elements, “the FAA requires a court to either stay or dismiss a lawsuit and to compel arbitration.” Lambert v. Austin Ind., 544 F.3d 1192, 1195 (11th Cir. 2008).

         III. Discussion

         The Defendant argues that the arbitration provision is valid and compels arbitration of the Plaintiff's FCRA claim. The Plaintiff makes three arguments in response. First, the Plaintiff argues that he ceased to be bound by the arbitration provision of the 2016 Service Agreement when he terminated the Defendant's services in August of 2017. Second, the Plaintiff argues that his FCRA claim is beyond the scope of the arbitration provision because they do not relate to the 2016 Service Agreement. Third, the Plaintiff argues that if the arbitration provision requires arbitration of claims unrelated to the 2016 Service Agreement, then the provision is unenforceable because it is unconscionable.

         A. Whether the Arbitration Provision Continues ...

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