Guidotti v. Legal Helpers Debt Resolution, L.L.C.
2013 U.S. App. LEXIS 10642
| 3rd Cir. | 2013Background
- Guidotti sued 22 defendants alleging a debt settlement scheme with unlicensed debt adjustment acts and NJ consumer/provisions; two main defendants RMBT and Global contested arbitration.
- District Court denied arbitration for RMBT/Global, finding no meeting of the minds on arbitration based on record evidence.
- Guidotti signed a Special Purpose Account Application (SPAA) and an Account Agreement via DocuSign pathway, but dispute whether the Account Agreement (with arbitration clause) was provided at SPAA time.
- There is conflict over whether Guidotti received and assented to the Account Agreement when signing SPAA, or only after, affecting arbitration enforceability.
- The issue centers on the proper standard to evaluate arbitration motions: Rule 12(b)(6) dismissal or Rule 56 summary judgment with potential limited discovery.
- The Third Circuit vacates the district court’s order and remands for further proceedings, clarifying the standards and allowing limited discovery to determine arbitrability.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standard for evaluating arbitration motions | Guidotti argues for Rule 56 with discovery; there is a genuine dispute. | RMBT/Global argue for Rule 12(b)(6) dismissal; arbitrability apparent from SPAA. | Arbitrability assessed under Rule 56 after limited discovery. |
| Whether Guidotti received the Account Agreement at SPAA time | Evidence (DocuSign headers) suggests late receipt; creates issue of meeting of minds. | Account Agreement not provided with SPAA; presumed assent. | Genuine issue of material fact on receipt and assent to arbitration. |
| Need for limited discovery pre-arbitration | Discovery necessary to test formation of arbitration agreement and costs. | Discovery unnecessary if arbitration appears enforceable on face. | Remand for limited discovery before renewed summary judgment review. |
Key Cases Cited
- Par-Knit Mills, Inc. v. Stockbridge Fabrics Co., Ltd., 636 F.2d 51 (3d Cir. 1980) (determines when to treat arbitration questions under 12(b)(6) or 56; meeting of the minds may require jury)
- Kirleis v. Dickie, McCamey & Chilcote, P.C., 560 F.3d 156 (3d Cir. 2009) (presence of conflicting affidavits creates factual issue on arbitration formation)
- Somerset Consulting, LLC v. United Capital Lenders, LLC, 832 F. Supp. 2d 474 (E.D. Pa. 2011) (recognizes when to apply 12(b)(6) vs. 56 in arbitration context)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (Supreme Court 1983) (FAA aims for speedy resolution but honors private agreements; arbitrability questions judicially resolved)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (Supreme Court 2007) (pleading standard for plausibility applied to Rule 12(b)(6) analysis)
- Quilloin v. Tenet HealthSystem Phila., Inc., 673 F.3d 221 (3d Cir. 2012) (discusses judicial determination of arbitrability under FAA)
- First Options of Chi., Inc. v. Kaplan, 514 U.S. 938 (Supreme Court 1995) (requires clear and unmistakable evidence of agreement to arbitrate arbitrability)
- Green Tree Financial Corp.-Alabama v. Randolph, 531 U.S. 79 (Supreme Court 2000) (costs/arbitration fees can affect enforceability of arbitration)
- Blair v. Scott Specialty Gases, 283 F.3d 595 (3d Cir. 2002) (discovery may be warranted to assess arbitration costs and payability)