Alwert v. Cox Communications, Inc.
835 F.3d 1195
| 10th Cir. | 2016Background
- Plaintiffs (Alwert and Feldman) are Cox subscribers who brought putative class antitrust suits alleging Cox tied premium cable to set-top-box rentals; their Internet-subscriber agreements were later modified to add a broad arbitration clause.
- Cox posted the amended arbitration terms in Nov. 2011 and mailed notice to these plaintiffs in Mar–Apr 2012; plaintiffs did not opt out. The clause covered “any and all claims … that arise out of or in any way relate to” Cox goods or services and included a class-action waiver and 30‑day opt‑out.
- Plaintiffs’ regional putative class suits (Alwert — Louisiana market; Feldman — Arizona market) proceeded after a stay of related MDL litigation; Cox moved to compel arbitration shortly after answering and after plaintiffs served limited discovery requests.
- The district court granted Cox’s motions to compel arbitration, finding (1) the arbitration clause covers these disputes, (2) Cox did not waive arbitration, and (3) the arbitration clause was supported by consideration.
- Plaintiffs appealed under 28 U.S.C. §1292(b). The Tenth Circuit affirmed, holding scope and waiver resolved for court, but the argument that Cox’s promises were illusory is a challenge to the contract as a whole and thus for the arbitrator.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope — whether the arbitration clause covers plaintiffs’ pre‑existing set‑top box antitrust claims | The dispute predates the agreement; arbitration should not apply to claims that arose earlier or relate to separate services | The clause is broadly written to cover claims that "arise out of or in any way relate to" Cox goods/services, including prior conduct; presumption favors arbitration | The clause is broad and covers these claims; arbitration required (court decides scope) |
| Waiver — whether Cox waived the right to arbitrate by prior MDL litigation and delay | Cox litigated the bellwether Healy case and stayed these cases; that conduct waived arbitration and prejudiced plaintiffs | Cox moved to compel arbitration soon after answering here, did not substantially invoke litigation in these specific cases, and Healy involved different parties/markets | No waiver: waiver requires litigation of the same claim between same parties or prejudicial invocation of litigation machinery; not shown here |
| Illusory promise / consideration — whether Cox’s unilateral modification clause renders arbitration unenforceable | The Intro allows Cox to unilaterally modify the Agreement (including arbitration clause), making the promise illusory and unenforceable | Even if unilateral modification exists, that is a challenge to the contract as a whole; under Prima Paint/Buckeye such challenges go to the arbitrator | Challenge is to contract as a whole; under Prima Paint/Buckeye arbitrability of that issue belongs to arbitrator, so court did not decide it |
| State‑law variation — whether Arizona or Louisiana law requires separate consideration for arbitration clause (making it a court question) | State law may require consideration specific to arbitration clause, which would let court decide enforceability | No showing that Arizona or Louisiana law departs from general contract principles that treat consideration across the entire contract as sufficient; Louisiana precedent favors enforceability | Plaintiffs did not show state law requires a different result; court leaves any merits of illusory‑promise challenge to arbitrator |
Key Cases Cited
- Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473 U.S. 614 (1985) (court first determines whether parties agreed to arbitrate)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (FAA creates liberal federal policy favoring arbitration; doubts resolved for arbitration)
- Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967) (challenges to the contract as a whole go to arbitrator; only disputes about the making of the arbitration clause are for the court)
- Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006) (reaffirmed Prima Paint: validity of entire contract belongs to arbitrator)
- Zink v. Merrill Lynch Pierce Fenner & Smith, Inc., 13 F.3d 330 (10th Cir. 1993) (arising/related language construed to cover disputes predating agreement)
- In re Cox Enters., Inc. Set-top Cable Television Box Antitrust Litig., 790 F.3d 1112 (10th Cir. 2015) (MDL bellwether Healy — court found waiver of arbitration in that distinct bellwether case)
- Peterson v. Shearson/American Express, 849 F.2d 464 (10th Cir. 1988) (six‑factor test for waiver by litigation conduct)
- Russell v. Citigroup, Inc., 748 F.3d 677 (6th Cir. 2014) (distinguished; agreement language and factual circumstances can limit retroactive coverage)