35 A.3d 1002
Vt.2011Background
- AT&T Mobility, LLC appeals denial of its motion to compel arbitration and argues the court erred by (a) finding Porter’s Unicel contract was not assigned to AT&T before the offending texts, and (b) failing to hold an evidentiary hearing on assignment.
- Porter had a July 2007 Unicel wireless contract in Burlington; AT&T purchased Unicel Vermont contracts in December 2008 and completed the acquisition by December 22, 2008.
- Beginning in early 2009, Unicel customers were informed they became AT&T customers; Porter continued to receive unsolicited text messages in 2009 after this transition.
- In November 2009 Porter signed a new AT&T wireless contract; Porter sued on November 18, 2009 for violations of 47 U.S.C. § 227 and FCC rules; AT&T moved to compel arbitration relying on the Unicel arbitration clause.
- The trial court denied arbitration, ruling Porter wasn’t an AT&T customer when the texts occurred; AT&T sought reconsideration and appeals; the court affirmed arbitration denial.
- The court held AT&T’s evidence failed to prove it acquired Porter’s contract before the text messages and rejected AT&T’s argument that it could enforce arbitration as a successor/assignee for pre-assignment conduct.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was Porter’s contract assigned to AT&T before the texts? | Porter | AT&T | No clear proof of prior assignment; assignment not shown before texts |
| Should the court have held an evidentiary hearing on assignment timing? | Porter | AT&T | No; lack of prejudice from no third hearing; record adequate to decide |
| Does AT&T, as assignee, have standing to compel arbitration for pre-assignment conduct under the clause covering prior or future dealings? | Porter | AT&T | No; prior dealings not shown and clause does not extend to pre-assignment conduct |
| Under FAA review, which standard applies to denial of motion to compel arbitration? | Porter | AT&T | De novo review; standard akin to summary judgment |
Key Cases Cited
- In re Ambassador Ins. Co., 2008 VT 105 (Vt. 2008) (assignment interest does not necessarily include arbitration rights)
- Little v. Allstate Ins. Co., 167 Vt. 171 (Vt. 1997) (FAA standard of review for arbitration-formation disputes)
- In re Shenandoah LLC, 2011 VT 68 (Vt. 2011) (insufficient documentation undermines ownership claims)
- U.S. Bank Nat’l Ass’n v. Kimball, 2011 VT 81 (Vt. 2011) (evidence must show holder of note/claim at time of filing)
- Stenzel v. Dell, Inc., 2005 ME 37 (Me. 2005) (summary-like review for contract formation issues)