Matthew Warciak v. Subway Restaurants, Incorporat, 880 F.3d 870

Warciak used his mother’s T‑Mobile phone plan as an authorized user but never signed any service agreements.
His mother signed T‑Mobile service agreements in 2006 and 2012 that contained arbitration clauses.
In 2016 Warciak received a spam text promoting Subway and sued Subway under federal and state consumer‑protection statutes.
Subway moved to compel arbitration relying on the arbitration clauses in the contracts between T‑Mobile and Warciak’s mother, asserting non‑signatory estoppel.
The district court applied federal estoppel law and compelled arbitration; Warciak appealed.
The Seventh Circuit reviewed de novo, applied Illinois law, and found Subway could not prove promissory estoppel (no detrimental reliance), reversing the order to compel arbitration and remanding.

Issue	Warciak’s Argument	Subway’s Argument	Held
Which law governs whether a non‑signatory is bound by another’s arbitration clause?	Illinois (state) law should govern.	Federal common‑law estoppel governs.	State “traditional principles” govern; apply Illinois law.
Can Subway bind Warciak to his mother’s arbitration clauses via promissory estoppel?	No; Illinois promissory estoppel requires detrimental reliance, which is absent.	Yes; promissory estoppel/federal estoppel should bind Warciak.	No; under Illinois law Subway disclaimed and failed to prove detrimental reliance, so estoppel does not bind Warciak.

Scheurer v. Fromm Family Foods LLC, 863 F.3d 748 (7th Cir. 2017) (state traditional‑law principles govern enforceability of arbitration provisions against nonparties)
Arthur Andersen LLP v. Carlisle, 556 U.S. 624 (U.S. 2009) (traditional principles of state contract law allow enforcement by/against nonparties)
United Steelworkers v. Warrior & Gulf Nav. Co., 363 U.S. 574 (U.S. 1960) (a party cannot be compelled to arbitrate absent agreement)
Ervin v. Nokia, Inc., 812 N.E.2d 534 (Ill. App. Ct. 2004) (elements of equitable/promissory estoppel under Illinois law)