Garcia v. Dell, Inc.

905 F. Supp. 2d 1174, 2012 WL 5928132, 2012 U.S. Dist. LEXIS 168204
CourtDistrict Court, S.D. California
DecidedNovember 13, 2012
DocketCase No. 12-CV-0940 BEN (NLS)
StatusPublished

This text of 905 F. Supp. 2d 1174 (Garcia v. Dell, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Garcia v. Dell, Inc., 905 F. Supp. 2d 1174, 2012 WL 5928132, 2012 U.S. Dist. LEXIS 168204 (S.D. Cal. 2012).

Opinion

ORDER COMPELLING ARBITRATION

ROGER T. BENITEZ, District Judge.

In this proposed class action dispute, Defendant Dell Financial Services, LLC (“DFS”)1 moves to compel arbitration. [1176]*1176(Docket No. 13.) For the reasons stated below, the Court GRANTS Defendant’s motion to compel arbitration.

BACKGROUND

Defendant DFS is a Delaware limited liability company engaged in the business of, among other things, providing servicing functions for Dell Business Credit Accounts (“DBC Accounts”), which are credit accounts that small-to-medium sized businesses use to finance the purchase of computer related goods and services from Dell, Inc. According to DFS’s records, on June 1, 2009, the Montegna Law Office applied online for and obtained a DBC Account to finance and purchase products from Dell.

When the Montegna Law Office applied online and created a DBC Account, it provided contact information, including a telephone number to the Montegna Law Office, and signed a Consumer Agreement (“Agreement”) which included an arbitration clause. The arbitration clause stated:

[A]ny claim, dispute or controversy (whether based upon contract; tort, intentional or otherwise; constitution; statute; common law; or equity ...) ... arising from or relating to the Credit Agreement or the relationships which result from this Credit Agreement, including the validity or enforceability of this arbitration provision, any part thereof or the entire Credit Agreement (“Claim”) shall be decided, upon the election of you or us, by binding arbitration pursuant to this arbitration provision and the applicable rules and procedures of the arbitration administrator.

(Agreement at 7.)

The arbitration clause also stated that: It is the intent of the parties to require Claims to be submitted to arbitration on an individual basis only. Claims subject to this arbitration provision may not be joined or consolidated in arbitration with any Claim of any other person or be arbitrated on a class basis, in a representative capacity on behalf of the general public or on behalf of any other person, unless otherwise agreed to by the parties in writing.

(Id. (emphasis in original).)

There was also a provision in the Agreement addressing telephone monitoring, which stated that “[tjelephone communications with Lender or its assigns or service providers (including DFS) may be monitored and recorded, in accordance with applicable law.” (Id. at 6.)

On April 4, 2012, a customer service representative called the Montegna Law Office on behalf of DFS. The representative called the number in its file for the Montegna Law Office and spoke to Plaintiff, an employee of the Montegna Law Office. During this telephone call, which was recorded, the representative asked to speak to someone regarding a business matter. Plaintiff informed the representative that no one was available, but asked for and received a contact number. Finally, Plaintiff asked if the call was being recorded, and the representative responded that it was, and that telephone calls were usually recorded.

Plaintiff brought this action on April 17, 2012. The complaint alleges common-law and statutory invasion of privacy, negligence, and unlawful and fraudulent business practices, and seeks statutory and punitive damages. Defendant has moved to compel arbitration, based on the arbitration clause in the Agreement.

DISCUSSION

Defendant’s motion to compel arbitration is governed by the Federal Arbi[1177]*1177tration Act (“FAA”). A district court’s role under the FAA is limited to determining: (1) whether a valid agreement to arbitrate exists; and, if it does, (2) whether the agreement encompasses the dispute at issue. Lifescan, Inc. v. Premier Diabetic Servs., Inc., 363 F.3d 1010, 1012 (9th Cir.2004). If the district court determines that a valid arbitration agreement encompasses the dispute, then the FAA requires the court to enforce the arbitration agreement in accordance with its terms. Id. “Any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration.” Simula, Inc. v. Autoliv, Inc., 175 F.3d 716, 719 (9th Cir.1999) (internal quotation marks omitted).

Defendant moves to compel arbitration on the basis that the arbitration clause in the Agreement mandates that this action be arbitrated. Plaintiff advances several arguments as to why the Court should not compel arbitration. Each will be addressed in turn.

I. Agreement to Arbitrate

As stated by the court in Lifescan, this Court must determine whether a valid agreement to arbitrate exists and whether the agreement encompasses the dispute at issue. Both parties agree that a valid contract which included an arbitration agreement existed between the Montegna Law Office and Defendant. However, the parties dispute whether the Agreement encompassed the dispute at issue and whether the Agreement applies to Plaintiff as a non-signatory.

The United States Supreme Court has held that there is a “presumption of arbitrability in the sense that an order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute.” AT & T Techs., Inc. v. Commc’ns Workers of Am., 475 U.S. 643, 650, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (internal quotation marks and alteration omitted). In this case, the arbitration clause is indeed susceptible of an interpretation that covers the asserted dispute because the arbitration clause broadly covers any dispute or controversy arising from the Agreement, and the Agreement contains a clause explicitly addressing telephone monitoring. Therefore, the arbitration clause encompasses the dispute at issue.

Plaintiff contends that because she was not a party to the contract made between Defendant and the Montegna Law Office, the arbitration clause in the contract does not apply to her and cannot be compelled. The case most analogous to the present one appears to be Amisil Holdings Ltd. v. Clarium Capital Management, 622 F.Supp.2d 825 (N.D.Cal.2007).

In Amisil, the plaintiff entered into an agreement that included an arbitration clause with the defendant company. Id. at 829. The plaintiff brought suit against both the company and individual members of the company, and the defendants sought to compel arbitration. Id. Plaintiff argued that since the individual defendants were not signatories to the arbitration agreement, they could not compel arbitration. Id. at 830. The court noted that a “non-signatory may be bound by an agreement to arbitrate under ordinary contract and agency principles, such as 1) incorporation by reference; 2) assumption; 3) agency; 4) veil-piercing/alter ego; and 5) estoppel.” Id. (internal quotation marks omitted).

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Related

At&T Technologies, Inc. v. Communications Workers
475 U.S. 643 (Supreme Court, 1986)
Gilmer v. Interstate/Johnson Lane Corp.
500 U.S. 20 (Supreme Court, 1991)
Green Tree Financial Corp.-Alabama v. Randolph
531 U.S. 79 (Supreme Court, 2000)
Coneff v. AT & T CORP.
673 F.3d 1155 (Ninth Circuit, 2012)
Simula, Inc. v. Autoliv, Inc.
175 F.3d 716 (Ninth Circuit, 1999)
Amisil Holdings Ltd. v. Clarium Capital Management
622 F. Supp. 2d 825 (N.D. California, 2007)
Letizia v. Prudential Bache Securities, Inc.
802 F.2d 1185 (Ninth Circuit, 1986)

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Bluebook (online)
905 F. Supp. 2d 1174, 2012 WL 5928132, 2012 U.S. Dist. LEXIS 168204, Counsel Stack Legal Research, https://law.counselstack.com/opinion/garcia-v-dell-inc-casd-2012.