ADT LLC v. Madison

CourtDistrict Court, N.D. Texas
DecidedNovember 30, 2020
Docket3:20-cv-01417
StatusUnknown

This text of ADT LLC v. Madison (ADT LLC v. Madison) is published on Counsel Stack Legal Research, covering District Court, N.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
ADT LLC v. Madison, (N.D. Tex. 2020).

Opinion

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION ADT LLC, § § Plaintiff, § § v. § CIVIL ACTION NO. 3:20-CV-1417-B § TAYLOR MADISON and ANGIE § DICKSON, § § Defendants. § MEMORANDUM OPINION AND ORDER Before the Court are: (1) Plaintiff ADT, LLC (“ADT”)’s Motion to Compel Arbitration (Doc. 19); (2) ADT’s Second Amended Petition for Order Compelling Arbitration (Doc. 39); and (3) Defendants Taylor Madison and Angie Dickson’s Second Amended Motion to Dismiss for Lack of Subject Matter Jurisdiction (Doc. 42). For the following reasons, the Court GRANTS Defendants’ Motion (Doc. 42), DENIES ADT’s Motion (Doc. 19), and DISMISSES ADT’s Second Amended Petition (Doc. 39). I. BACKGROUND1 ADT provides residential and commercial alarm services, including the installation and monitoring of home security systems. Doc. 39, Second Am. Pet., ¶ 1. On February 19, 2020, Madison contracted with ADT for the installation of a security system, including security cameras, in her home. See Doc. 44, Pl.’s App., 7, 14. The contract between Madison and ADT contained an 1 The facts are drawn from the parties’ pleadings and briefs. - 1 - arbitration clause requiring the parties to arbitrate “any and all disputes between [them].” Id. at 11. In April 2020, ADT informed Madison that the technician who installed Madison’s security cameras, Telesforo Aviles, had accessed the cameras in her home without authorization, “potentially

viewing Ms. Madison in her home.” Doc. 43, Pl.’s Resp., 3. Through his employment with ADT, Aviles gained access to 220 customer accounts, enabling him to view customers in their homes through security cameras. Doc. 39, Second Am. Pet., ¶ 9. According to Madison, Aviles illegally accessed the cameras in her home “approximately 139 times between February 25, 2020 and March 25, 2020.” Doc. 42, Defs.’ Second Am. Mot., 3. ADT terminated Aviles’s employment, and Aviles currently faces federal criminal charges. See Doc. 39, Second Am. Pet., ¶ 24. Madison sent ADT a “Notice to Preserve Evidence,” requesting that ADT preserve evidence related to Aviles’s conduct

and stating “that litigation will likely ensue.” Doc. 44, Pl.’s App., 21 (emphasis omitted). On May 13, 2020, Madison filed suit against Aviles, in his personal capacity, in Texas state court. Doc. 42, Second Am. Mot., 11. Madison’s state-court petition seeks an injunction against Aviles preventing him from altering or destroying his equipment and from coming within 200 yards of her residence. Id. at 14–15. She also seeks twelve categories of monetary damages from Aviles. Id. at 15–16. Through the discovery process in the state-court action against Aviles, Madison served ADT with a third-party

subpoena seeking “information about the criminal actions of ADT employee Telesforo Aviles and ADT’s knowledge of those actions.” Doc. 44, Pl.’s App., 47. In response to the subpoena, ADT filed the pending suit in this Court against Madison and her mother, Dickson.2 ADT’s Second Amended Petition, the live pleading in this matter, seeks an

2 After serving the subpoena and after ADT filed its First Amended Petition (Doc. 8), Madison amended her state-court complaint to add her mother, Angie Dickson, as a plaintiff. Doc. 42, Defs.’ Second - 2 - order: (1) compelling Madison to arbitrate any and all claims she may have against ADT; (2) enjoining Madison from conducting pre-litigation discovery against ADT; and (3) enjoining the state court from enforcing any subpoena issued by Madison against ADT. Doc. 39, Second Am. Pet.,

¶¶ 1–3. On August 18, 2020, ADT intervened in the state-court action. Doc. 45, Defs.’ Reply, ¶¶ 3–4. Madison now seeks to dismiss ADT’s petition on the grounds that the Court lacks subject matter jurisdiction to compel arbitration.3 Doc. 42, Defs.’ Second Am. Mot., 5–7. ADT filed a response (Doc. 43) to the motion on August 25, 2020, and Madison filed a reply (Doc. 45) in support of her motion on September 2, 2020. Upon the Court’s order (Doc. 48), the parties filed supplemental briefs (Docs. 49 and 50) to address the amount-in-controversy requirement of 28 U.S.C. § 1332. The motion is ripe for review.

II. LEGAL STANDARD “Federal courts are courts of limited jurisdiction.” Settlement Funding, L.L.C. v. Rapid Settlements, Ltd., 851 F.3d 530, 537 (5th Cir. 2017) (quoting Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001)). Courts “must presume that a suit lies outside this limited jurisdiction, and the burden of establishing federal jurisdiction rests on the party seeking the federal forum.” Id.

(citation omitted). And “[i]f the record does not contain sufficient evidence to show that subject matter jurisdiction exists, ‘a federal court does not have jurisdiction over the case.’” Id. (quoting Am. Mot., 3–4. For the sake of simplicity, because Dickson “is not a signatory to the ADT Contract,” Doc. 39, Second Am. Pet., ¶ 20, and because ADT’s underlying disputes with Dickson are the same as its disputes with Madison, this Order hereinafter refers to Defendants collectively as “Madison.” 3 Madison also claims that dismissal is proper because ADT failed to join Aviles, a necessary party. Doc. 42, Defs.’ Second Am. Mot., 8–9. Because the Court decides the motion on jurisdictional grounds, it does not reach this argument. - 3 - Howery, 243 F.3d at 916). Section 4 of the Federal Arbitration Act (“FAA”) authorizes a United States district court to enforce a valid arbitration agreement if one of the parties to the agreement petitions the court to

do so. 9 U.S.C. § 4. However, the FAA “bestows no federal jurisdiction but rather requires for access to a federal forum an independent jurisdictional basis over the parties’ dispute.” Vaden v. Discover Bank, 556 U.S. 49, 59 (2009) (cleaned up and quoting Hall St. Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 581–82 (2008)). Pursuant to § 4, the petitioner must file in a “United States district court which, save for [an arbitration] agreement, would have jurisdiction . . . of the subject matter of a suit arising out of the controversy between the parties.” § 4. Accordingly, “a district court must ‘look through’ a § 4 petition to determine whether the district court would have jurisdiction over the

underlying substantive controversy.” Lower Colo. River Auth. v. Papalote Creek II, L.L.C., 858 F.3d 916, 923 (5th Cir. 2017) (citing Vaden, 556 U.S. at 53, 62). If, absent the arbitration agreement, a federal court would lack an independent basis for subject matter jurisdiction over the underlying dispute, the court lacks jurisdiction to compel arbitration. Id. (“Vaden’s holding necessarily implies that any of the reasons that a federal court may lack subject matter jurisdiction over the underlying dispute—e.g., ripeness—would similarly prevent a district court from having jurisdiction to compel

arbitration.”). “Such independent bases include diversity of citizenship under 28 U.S.C. § 1332 or federal question jurisdiction under 28 U.S.C. § 1331.” Quezada v. Bechtel OG & C Constr.

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Bluebook (online)
ADT LLC v. Madison, Counsel Stack Legal Research, https://law.counselstack.com/opinion/adt-llc-v-madison-txnd-2020.