Jessica Parm v. Bluestem Brands, Inc., 898 F.3d 869

Background

Bluestem operates Fingerhut and Gettington; Fingerhut offered financing through third‑party banks and displayed prices primarily as monthly payments, often higher than Gettington’s lump‑sum prices.
Customers who used Fingerhut credit agreed to arbitration clauses in their credit agreements (2010, 2013/2014 forms) covering disputes “arising from or relating to” the credit or the agreement.
Plaintiffs (Parm, Arce, Bowers, Osorio) filed consolidated class actions alleging Bluestem charged hidden finance fees (higher Fingerhut prices) that, when combined with disclosed APRs, produced usurious rates and violated state usury, TILA, unjust enrichment, and consumer‑protection laws.
District court compelled arbitration for some claims but held three categories non‑arbitrable: (1) state usury claims to the extent they allege hidden finance charges independent of the credit agreements, (2) state and federal disclosure/TILA claims alleging failure to disclose hidden finance charges separate from the revolving credit accounts, and (3) unjust enrichment claims tied solely to product pricing (not the banks’ credit).
The Eighth Circuit reviewed de novo whether the disputes fall within the arbitration clauses’ scope, noting the parties do not contest validity of the arbitration agreements and that the clauses are broadly worded.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether state‑law usury claims alleging a “hidden finance charge” are subject to arbitration	Usury claims challenge Bluestem’s pricing practice independent of the credit agreements and thus fall outside arbitration	Arbitration clauses cover any dispute “arising from or relating to” the credit; the usury claims rest on the financing and are arbitrable	Arbitrable — claims arise from/relate to the credit and must be sent to arbitration
Whether disclosure/TILA and related consumer‑protection claims about nondisclosure of hidden finance charges are subject to arbitration	These disclosure claims concern Bluestem’s pricing/marketing and would survive absent a financing relationship, so they are outside arbitration	The alleged “hidden finance charge” is defined by and depends on the extension of credit; claims therefore touch the credit agreements and are arbitrable	Arbitrable — allegations turn on the financing relationship and fall within broad arbitration clauses
Whether unjust enrichment claims based on pricing (not the banks’ credit) are subject to arbitration	Unjust enrichment tied solely to product pricing (sale of goods) does not arise from the credit agreements and should proceed in court	The unjust enrichment theory depends on alleged hidden finance charges imposed in connection with financing, so it relates to the credit and is arbitrable	Arbitrable — unjust enrichment claims allege benefits received from hidden finance charges tied to credit and must be arbitrated

Key Cases Cited

AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (federal policy favors enforcing arbitration agreements)
Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002) (arbitrability is a matter of contract; courts decide gateway questions unless parties clearly delegate)
Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (strong federal policy favoring arbitration and broad clauses cover related disputes)
First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (clarity required before concluding parties did not intend to arbitrate a related matter)
Fleet Tire Serv. of N. Little Rock v. Oliver Rubber Co., 118 F.3d 619 (8th Cir. 1997) (distinguishes broad vs. narrow arbitration clauses)
Unison Co. v. Juhl Energy Dev., Inc., 789 F.3d 816 (8th Cir. 2015) (if clause is broad, factual allegations that touch covered matters favor arbitration)
3M Co. v. Amtex Sec., Inc., 542 F.3d 1193 (8th Cir. 2008) (look past claim labels to underlying facts to determine arbitrability)