525 F.Supp.3d 1080
N.D. Cal.2021Background
- In August 2016 Nordeman entered a Dish Service Agreement (America’s Top 200) with a guaranteed monthly price; the Agreement incorporated Dish’s Residential Customer Agreement (RCA), which contains an informal dispute-resolution step and a mandatory, individual arbitration clause.
- Nordeman also signed a Digital Home Advantage Plan Agreement (DHAPA) that acknowledged receipt and acceptance of the RCA.
- In 2017 Dish allegedly added services and billed Nordeman for unauthorized charges; Nordeman terminated and canceled the contract and claims Dish then reported him to credit agencies, harming his credit.
- Nordeman sued in state court (breach of contract; breach of implied covenant); Dish removed to federal court and moved to dismiss or stay pending arbitration, arguing the RCA’s informal dispute-resolution and arbitration provisions apply.
- Dish submitted a corporate declaration describing its electronic-signature procedures; the court found this sufficient to authenticate Nordeman’s signatures on the agreements.
- The court denied Dish’s motion because at this stage it was plausible the transaction was a "home solicitation" contract under California law and Nordeman’s asserted rescission could render the entire contract (including the arbitration clause) unenforceable; ambiguous evidence of an earlier phone agreement was not resolved on the motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a valid agreement to arbitrate exists | Nordeman: he never signed/consented to the arbitration terms | Dish: electronic signatures and corporate procedures show Nordeman signed and agreed | Court: Dish’s declaration sufficed to authenticate signatures — existence of signed agreements established at this stage |
| Whether the HSSA (home solicitation) invalidates the contract and arbitration clause | Nordeman: the contract is a home solicitation contract he rescinded (no three‑day cancellation notice), so contract (and arbitration clause) is unenforceable | Dish: HSSA doesn't apply because an earlier phone agreement at Dish’s trade premises formed the contract | Court: At pleading stage it is plausible HSSA applies; rescission could void the entire contract including arbitration; ambiguous phone-call evidence not resolved now; denies motion |
| Whether Nordeman’s failure to complete the RCA’s informal dispute process bars court action | Nordeman: N/A (contends contract invalid) | Dish: Nordeman failed to exhaust the RCA’s 60‑day informal process so arbitration/stay is required | Court: Declined to enforce exhaustion/arbitration because contract may be void under state law; denial of motion follows |
Key Cases Cited
- Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612 (2018) (FAA enforces arbitration agreements as a matter of federal policy)
- AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (FAA preempts state rules that undermine arbitration agreements)
- First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995) (state contract‑formation law governs whether parties agreed to arbitrate)
- Brennan v. Opus Bank, 796 F.3d 1125 (9th Cir. 2015) (two‑step inquiry: existence of agreement and scope of arbitration)
- Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126 (9th Cir. 2000) (court enforces arbitration if both existence and scope are established)
- United Steelworkers of Am. v. Warrior & Gulf Nav. Co., 363 U.S. 574 (1960) (arbitration is a matter of contract; courts cannot compel arbitration where no agreement exists)
- Moncharsh v. Heily & Blase, 3 Cal.4th 1 (1992) (California law: grounds to revoke a contract also vitiate any arbitration clause within it)
- Duffens v. Valenti, 161 Cal. App. 4th 434 (2008) (statutory noncompliance that is central to statutory policy can render a contract void and preclude arbitration)
- Weatherall Aluminum Prod. Co. v. Scott, 71 Cal. App. 3d 245 (1977) (home solicitation statute applies beyond door‑to‑door sales; seller’s failure to include cancellation notice can void contract)
- Sheppard, Mullin, Richter & Hampton, LLP v. J‑M Mfg. Co., 6 Cal.5th 59 (2018) (contract unlawful and unenforceable if contrary to express statute or its policy)
- Ruiz v. Moss Bros. Auto Grp., 232 Cal. App. 4th 836 (2014) (authentication of a writing may be shown by evidence of signature attribution procedures)