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US Dept. of Treasury’s Analysis Parts Ways with the CFPB on the CFPB’s Arbitration Rule

by Scott J. Hyman |

Today, the Dept. of Treasury issued an analysis of the CFPB's Arbitration Rule, entitled Limiting Consumer Choice, Expanding Costly Litigation: An Analysis of the CFPB Arbitration Rule.  The Dept. of the Treasury concluded that In view of these defects, it is clear that the Rule does not satisfy the statutory prerequisites for banning the use of arbitration agreements under the… Read More

District Court (Cal.) Orders Auto Case to Arbitration; Arbitrator to Determine Effect of McGill on Enforceability of Arbitration Clause

by Scott J. Hyman |

In Garcia v. Santander Consumer USA, Inc., 2017 WL 4325777, at *2–3 (E.D.Cal., 2017), Judge McGill ordered an auto finance case to arbitration, allowing the Arbitrator to determine the effect of McGill on the enforceability of the Arbitration clause. The arbitration provision stated in part, “Any claim or dispute is to be arbitrated by a single arbitrator on an individual basis and not… Read More

Court of Appeal (Cal.) in McGill Runs Full Course; Remands to Trial Court to Determine Severability of Public Relief Waiver and Whether McGill Waived Her Right to Challenge the Trial Court’s Order

by Scott J. Hyman |

In McGill v. Citibank, 2017 WL 4382034, at *3 (Cal.App. 4 Dist., 2017) (unpublished), the Court of Appeal put its gloss on the Supreme Court's decision in McGill and what is left for the trial court to decide on remand. The Supreme Court concluded its opinion with the following paragraph: “Our invalidation of the arbitration provision insofar as it purports to waive McGill's… Read More

Court of Appeal (Conn.) Holds that Dealer/Holder Dispute was Properly Before the Arbitrator in Dealer/Consumer Arbitration

by Scott J. Hyman |

In Rodriguez v. A Better Way Wholesale Autos, Inc., 176 Conn.App. 392, 2017 WL 3977264 (Conn. App. April 17, 2017) , the Connecticut Court of Appeal held that adjudicating a dispute between the dealer and the finance company was properly within an Arbitrator’s jurisdiction in a consumer versus dealer arbitration. Here, A Better Way asserts that the parties' submission to… Read More

11th Cir. Says Auto Finance Company Defending TCPA Case Cannot Rely on Dealer’s Separate Arbitration Clause that Was Not Contained in the RISC

by Scott J. Hyman |

In Drayton v. Toyota Motor Credit Corporation, 2017 WL 1485027 (11th Cir. 2017), the Court of Appeals found that an arbitration clause could not be enforced. Lisa Drayton brought a putative class action claim against Toyota after she allegedly received automated telephone calls from Toyota attempting to collect a consumer debt. She alleged that the calls violated the Telephone Consumer Protection Act… Read More

California Supreme Court addresses Whether Broughton/Cruz Rule Survives Concepcion

by Scott J. Hyman |

In McGill v. Citibank, N.A., 2017 WL 1279700, at *1 (Cal., 2017), the California Supreme Court addresses whether the Broughton/Cruz rule survives Concepcion.  See Kilgore v. KeyBank, Nat. Ass'n, --- F.3d ----, 2012 WL 718344 (9th Cir. 2012) ("the Broughton–Cruz rule does not survive Concepcion because the rule “prohibits outright the arbitration of a particular type of claim”—claims for broad public… Read More

Court of Appeal (Cal.) Says RISC Arb. Clause Means What It Says: An Arbitration Award in Excess of $100,000 Entitles Defendants to New Arbitration, Even if JAMS Has No “Appellate” Process and Parties Agreed to Use Different Arbitrator than Identified in RISC

by Scott J. Hyman |

In Raczynski v. Daland Nissan, Inc. 2017 WL 603869, at *4–5 (Cal.App. 1 Dist., 2017), the Dealer got hit for $358,000 by a JAMS arbitrator.  The customer would not agree to a second arbitration under the RISC's clause allowing one if an award exceeded $100,000, and the trial court refused to order a second arbitration.  The Court of Appeal, in an… Read More

Supreme Court (New Mexico) Finds Arbitration Clause in Automobile RISC Not Unconscionable

by Scott J. Hyman |

In Eileen J. Dalton v. Santander Consumer Usa, Inc., 2016 WL 5266621, at *6 (N.M., 2016), the New Mexico Supreme Court rejected an unconscionability challenge to an arbitration clause in the standard form RISC. "The self-help and small claims carve-out provisions in the arbitration clause of the finance contracts are not substantively unconscionable. Therefore, Dalton did not satisfy her burden… Read More

CFPB Issues Notice of Proposed Rulemaking Regarding Consumer Arbitration Clauses

by Scott J. Hyman |

Today, the CFPB issued a Notice of Proposed Rulemaking with regard to consumer arbitration, here:  CFPB_Arbitration_Agreements_Notice_of_Proposed_Rulemaking.  The CFPB's press release is here:  CFPB Press Release. The CFPB proposal is seeking comment on a proposal to prohibit companies from putting mandatory arbitration clauses in new contracts that prevent class action lawsuits. The proposal would open up the legal system to consumers… Read More

They Keep Trying: District Court (Cal.) Rejects Argument that Enforcement of Arbitration Clause Constitutes “State Action” Depriving Plaintiff of Access to the Courts under the First Amendment

by Scott J. Hyman |

In Roberts v. AT&T Mobility, LLC, 2016 WL 1660049, at *1-4 (N.D.Cal., 2016), Judge Chen enforced AT&T's arbitration clause and class action waiver against Plaintiff's constitutional challenge. Plaintiffs essentially raise three arguments as to why arbitration should not be compelled: (1) because, if this Court were to compel arbitration, that would be state action that would violate their First Amendment rights –… Read More

District Court (Cal.) Enforces RISC Arb. Clause Post-Sanchez, Finding No Waiver; Says in Dicta that Broughton/Cruz Pre-empted

by Scott J. Hyman |

In Goodridge v. KDF Automotive Group, Inc., 2016 WL 142216, at *9-10 (Cal.App. 4 Dist., 2016) (unpublished), the Court of Appeal addressed Plaintiff's continued post-Sanchez fight against arbitration, finding that the standard form RISC was not unconscionable.  The Court of Appeal also found that that the Defendant's litigation conduct did not waive the right to assert it. We conclude Goodridge has not… Read More

District Court (Tn.) Denies Pre-Emptive TCPA Class Certification Motion By Granting Responsive Petition to Compel Arbitration

by Scott J. Hyman |

In Stevens-Bratton v. TruGreen, Inc., 2016 WL 155087, at *2 (W.D.Tenn., 2016), Judge Anderson denied a class certification motion on the basis that the Defendant responded to it with a Petition to Compel Arbitration, finding that the Arbitration Clause was not unconscionable.  The unconscionability analysis is not unusual, so much as the procedural posture. TruGreen is a national lawn care… Read More

District Court (NY) Orders TCPA Case to Arbitration; Finds Nothing in TCPA Suggesting that Congress Meant to Foreclose Arbitrability of TCPA Cases

by Scott J. Hyman |

In McCormick v. Citibank, NA, 2016 WL 107911, at *5 (W.D.N.Y., 2016), Judge Curtin ordered a TCPA case to arbitration, holding that the TCPA itself did not preclude arbitration. Because plaintiff asserts a federal statutory claim, the court must consider “whether Congress evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue.” . .… Read More

Third Time’s a Charm: Court of Appeal (Cal.) Orders NOI Class Action to Arbitration; Rejects Sanchez’ “Ability to Pay Arbitration Costs” Loophole Where Cheaper Vehicles are Involved

by Scott J. Hyman |

In Trabert v. Consumer Portfolio Services, Inc., 2015 WL 9271437, at *6-8 (Cal.App. 4 Dist. 2015) (unpublished), the Court of Appeal addressed for the third time whether an arbitration clause in a standard form RISC was unconscionable.  The Court of Appeal addressed the consumer's argument that Sanchez was distinguishable where cheaper cars purchased by poorer consumers was involved.  The Court of Appeal… Read More

On Post-Sanchez Remand, Court of Appeal (Cal.) Denies Car Dealer’s Petition to Arbitration (Again) Because Declaration of Counsel Was Insufficient to Establish the Existence of Arbitration Agreement

by Scott J. Hyman |

In Natalini v. Import Motors, Inc., 2015 WL 8772839, at *2-3 (Cal.App. 1 Dist., 2015) (unpublished), the Court of Appeal was called upon to determine post-Sanchez whether a car dealer's petition to arbitrate should still be denied once the unconscionability analysis is removed.  The Court of Appeal said that there was an insufficient evidentiary basis upon which the existence of a valid arbitration clause… Read More

SCOTUS Reverses Imburgia; Kills the Consumers’ “Poison-Pill” Argument in Arbitration Jurisprudence

by Scott J. Hyman |

In DIRECTV, Inc. v. Imburgia, 2015 WL 8546242, at *1-2 (U.S.Cal.,2015), the Supreme Court of the United States once again affirmed its preference for arbitration, and killed the "poison-pill" argument that had gathered fancy amongst the plaintiff's bar. Petitioner DIRECTV, Inc., and its customers entered into a service agreement that included a binding arbitration provision with a class-arbitration waiver. It specified… Read More

District Court (Az.) Orders FDCPA Case against Vehicle Finance Co. to Arbitration; Says Arbitrator Will Decide if Claims Are Outside the Scope of RISC’s Arbitration Clause

by Scott J. Hyman |

In Johnson v. Santander Consumer USA Inc., 2015 WL 7567483, at *2-3 (D.Ariz., 2015), Judge Rayes ordered an FDCPA case to arbitration under a standard Arizona Automobile RISC. Both the RISC and the Amendment contain arbitration provisions that clearly and unmistakably delegate questions of arbitrability to the arbitrator. The RISC requires arbitration for any disputes “in contract, tort, statute or otherwise… Read More

Court of Appeal (Cal.) Finds Arb. Clause on Sanchez Remand Not Unconscionable; Says Trial Court Properly Struck Class Allegations in Granting Petition to Arbitrate

by Scott J. Hyman |

In Vargas v. SAI Monrovia B, Inc., 2015 WL 7301781, at *5 (Cal.App. 2 Dist., 2015) (unpublished), the Court of Appeal found the RISC arb. clause not to be unconscionable.  What's interesting about the opinion is what to do with the class action allegations in granting the petition to arbitration.  The Court of Appeal found that the trial court properly… Read More

Court of Appeal (Cal.) Says, after Sanchez Remand, RISC Arb. Clause is Enforceable

by Scott J. Hyman |

In Gillespie v. Svale Del Grande, Inc., 2015 WL 7307139, at *5-6 (Cal.App. 6 Dist., 2015) (unpublished), the Court of Appeal issued a lengthy opinion after remand from the Supreme Court in Sanchez that the Arbitration clause was enforceable.  The Court rejected the argument that neither the Arbitration Clause's choice of law or poison-pill provisions negated FAA pre-emption. The California Supreme Court disagreed… Read More

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