841 F. Supp. 2d 368
D.D.C.2012Background
- Plaintiffs allege RFPA violations stemming from American Express’s transfer of financial records to overseas call centers without permission or notice.
- Plaintiffs seek class-wide relief based on alleged systemic RFPA violations, while Defendants move to compel arbitration and stay the action per the Cardmember Agreement’s Arbitration Provision.
- The arbitration clause prohibits class actions or representative proceedings and limits arbitrator authority to disputes between the named parties.
- The Cardmember Agreement contains a Utah choice-of-law provision, and Defendants argue Utah law governs enforceability of the arbitration clause.
- Plaintiffs argue the arbitration clause is invalid under D.C. law or RFPA, while Defendants contend the FAA requires enforcing the clause.
- The court must decide (a) whether the arbitration provision is valid and enforceable under Utah law, and (b) whether RFPA/FAA considerations preclude arbitration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the Arbitration Provision valid and enforceable under the FAA? | Anekee argues the Provision is invalid under D.C. law and RFPA. | Apex argues the provision is valid under Utah law and enforceable under the FAA. | Arbitration provision valid and enforceable under Utah law. |
| What law governs the enforceability of the Arbitration Provision? | DC law applies and undermines enforceability. | Utah law governs due to express choice-of-law provision and contacts. | Utah law applies and supports enforceability. |
| Does RFPA preclude arbitration or require class-wide injunctive relief? | RFPA rights cannot be vindicated through individual arbitration; class relief is needed. | RFPA remedies can be pursued in arbitration; no requirement for class-wide injunctive relief. | RFPA does not preclude arbitration; provisions are enforceable. |
| Do Plaintiffs have standing to challenge the Arbitration Provision under DCCPPA? | Plaintiffs have injury-in-fact from inability to pursue class actions. | Standing not established for DCCPPA argument. | Plaintiffs have standing to challenge the provision under FAA framework. |
Key Cases Cited
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (Supreme Court 1995) (state-law contract formation standards apply to arbitration; FAA policy favors arbitration)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (Supreme Court 1983) (arbitration to be enforced according to contract terms)
- Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (Supreme Court 1991) (federal statutory claims may be arbitrated unless Congress indicates otherwise)
- Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (Supreme Court 1985) (claims based on federal statutes may be subject to arbitration)
- Randolph v. IV, 531 U.S. 79 (Supreme Court 2000) (general reservations about arbitration should not override statutory rights when vindicable in arbitral forum)
- Ekstrom v. Value Health, Inc., 68 F.3d 1394 (D.C. Cir. 1995) (contract choice-of-law provisions honored if reasonable relationship exists)
- AT&T Mobility, LLC v. Concepcion, 131 S. Ct. 1740 (Supreme Court 2011) (strong policy in favor of arbitration; enforceability of arbitration agreements)