Greene v. Dell Financial Services, LLC
1:21-cv-00457
| D.N.H. | Jan 26, 2022Background
- In early 2020 Greene financed Dell computer equipment and signed Dell Financial Services’ "Preferred Account Credit Agreement," which contains a broad arbitration clause.
- Dell began charging late fees; Greene disputed the fees, demanded Dell note the dispute to credit bureaus, and warned Dell not to call him.
- Dell allegedly continued charging fees, called Greene multiple times, and reported account information to credit bureaus without noting the dispute, which harmed his credit score.
- Greene stopped payments and sued in federal court under the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA).
- Dell moved to compel arbitration and stay or dismiss the case; Greene contended the arbitration clause was invalid or waived and that a small‑claims exception applied.
- The court applied New Hampshire contract law and federal arbitration principles, found the arbitration agreement valid and the claims arbitrable, rejected waiver and small‑claims arguments, and stayed/administratively closed the case pending arbitration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity of arbitration agreement | Agreement is poorly drafted, ambiguous, and thus not enforceable | Signed agreement with offer, acceptance, and consideration; Greene knew arbitration was possible | Court: Agreement is a valid contract under New Hampshire law; enforceable |
| Scope: Do FDCPA and FCRA claims fall within clause? | Clause ambiguous; grammatical defects; allegedly not meant to cover disputes with Dell (only intermediary) | Clause covers "any claim…including statutory claims" arising from applying for, obtaining, or using the account; expressly includes "we" = WebBank and Dell | Court: Broad language covers Greene’s FDCPA and FCRA claims |
| Waiver of arbitration by Dell | Dell delayed and engaged in litigation-related conduct; Greene suffered prejudice (filing fees, etc.) | Dell moved to compel about two months after complaint; litigation was in infancy; no meaningful prejudice | Court: No waiver; mere delay insufficient and Greene failed to show prejudice |
| Small‑claims exception in agreement | Dell promised not to invoke arbitration for claims brought in small claims or equivalent courts; Greene contends this covers his suit | Exception applies to small‑claims/analogous forums, not federal district court | Court: Exception doesn’t apply to federal district court; Greene reasonably could not treat district court as a "small claims equivalent" |
Key Cases Cited
- Am. Express Co. v. Italian Colors Rest., 570 U.S. 228 (2013) (FAA requires enforcement of arbitration agreements even for statutory claims)
- Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (strong federal policy favoring arbitration)
- Air-Con, Inc. v. Daikin Applied Latin Am., LLC, 21 F.4th 168 (1st Cir. 2021) (party seeking to compel arbitration must establish existence, right to invoke, that other is bound, and claim falls within scope)
- Granite Rock Co. v. Int'l Bhd. of Teamsters, 561 U.S. 287 (2010) (arbitration is a matter of consent and limited to disputes the parties agreed to submit)
- Toddle Inn Franchising, LLC v. KPJ Assocs., LLC, 8 F.4th 56 (1st Cir. 2021) (waiver analysis requires more than delay and some showing of prejudice; individualized inquiry)
- Joca-Roca Real Est., LLC v. Brennan, 772 F.3d 945 (1st Cir. 2014) (example of prejudice where party engaged in extensive litigation before seeking arbitration)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (summary judgment burden‑shifting framework)