USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 1 of 7
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT ________________________
No. 20-12037 Non-Argument Calendar ________________________
D.C. Docket No. 6:19-cv-01723-WWB-GJK
JESSICA GRAULAU,
Plaintiff-Appellant,
versus
CREDIT ONE BANK, N.A., a foreign corporation,
Defendant-Appellee.
________________________
Appeal from the United States District Court for the Middle District of Florida ________________________
(May 6, 2021)
Before LAGOA, BRASHER, and EDMONDSON, Circuit Judges. USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 2 of 7
PER CURIAM:
Plaintiff Jessica Graulau, proceeding pro se, 1 appeals the district court’s
order (1) dismissing Plaintiff’s civil action against Defendant Credit One Bank,
N.A. (“Credit One”) and (2) referring Plaintiff’s case to arbitration. In her
complaint, Plaintiff asserted against Credit One violations of the Telephone
Consumer Protection Act, 47 U.S.C. § 277 (“TCPA”), and of the Florida
Consumer Collection Practices Act, Fla. § 559.72 (“FCCPA”). No reversible error
has been shown; we affirm.
This appeal arises from alleged attempts by Credit One to collect Plaintiff’s
consumer debt. Plaintiff says she -- over a period of fifteen months -- received
thousands of robocalls from Credit One, despite having instructed Credit One’s
agents to stop calling her.
In January 2018, Plaintiff filed a counseled complaint against Credit One,
asserting violations of the TCPA and the FCCPA (“Graulau I”). The parties later
filed a “Joint Stipulation Dismissing and Referring Case to Arbitration.” In
pertinent part, the joint stipulation provided that “Plaintiff, through counsel, . . .
agrees this case is subject to arbitration pursuant to the cardholder agreement.”
1 We read liberally briefs filed by pro se litigants. See Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008). 2 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 3 of 7
The parties requested that the district court dismiss the case and refer the matter to
binding arbitration. On 10 April 2018, the district court entered an order referring
Graulau I to arbitration and dismissing the case.
Then, in September 2019, Plaintiff filed pro se the civil action underlying
this appeal. Plaintiff again asserted against Credit One claims for violation of the
TCPA and the FCCPA based on the same factual allegations asserted in Graulau I.
Plaintiff alleged that she had been unable to file an arbitration demand due to a
lack of financial resources.
Credit One moved to dismiss Plaintiff’s complaint and to enforce the 10
April 2018 order entered in Graulau I.
A magistrate judge issued a report and recommendation (“R&R”),
recommending that the district court grant Credit One’s motion, refer Plaintiff’s
claims to arbitration, and dismiss the case. The magistrate judge noted the parties’
joint stipulation in Graulau I that Plaintiff’s claims against Credit One were subject
to binding arbitration. The magistrate judge then determined that Plaintiff had
failed to show that arbitration would be prohibitively expensive or that
enforcement of the arbitration agreement would preclude Plaintiff from effectively
vindicating her rights. Plaintiff filed no timely objections to the R&R. 2
2 Generally speaking, a party that fails to object to the magistrate judge’s R&R waives the right to challenge on appeal a district court’s order based on the unobjected-to factual and legal 3 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 4 of 7
The district court adopted the R&R, granted Credit One’s motion, ordered
Plaintiff to “submit to arbitration in accordance with the Joint Stipulation,” and
dismissed the case.
We review de novo a district court’s order compelling arbitration. See
Emp’rs Ins. of Wausau v. Bright Metal Specialties, Inc., 251 F.3d 1316, 1321 (11th
Cir. 2001).
Through the Federal Arbitration Act, 9 U.S.C. § 1 et seq. (“FAA”), Congress
“declare[d] a national policy favoring arbitration of claims that parties contract to
settle in that manner.” See Burch v. P.J. Cheese, 861 F.3d 1338, 1345 (11th Cir.
2017) (quotation omitted). We have said that this “strong federal preference for
arbitration of disputes . . . must be enforced where possible.” See Musnick v. King
Motor Co., 325 F.3d 1255, 1258 (11th Cir. 2003). Among other things, the FAA
authorizes a district court “to issue an order compelling arbitration if there has been
a failure, neglect, or refusal to comply with an arbitration agreement.” Id. (citing 9
U.S.C. § 4).
In ruling on a motion to compel arbitration pursuant to section 4 of the FAA,
a district court follows a two-step inquiry. Klay v. PacifiCare Health Sys., Inc.,
conclusions. See 11th Cir. R. 3-1. That waiver rule does not apply in this case, however, because the R&R never informed Plaintiff about the time for objecting and about the consequences on appeal for failing to object. See id. 4 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 5 of 7
389 F.3d 1191, 1200 (11th Cir. 2004). First, the district court must “determine
whether the parties agreed to arbitrate the dispute.” Id. If so, the district court
must then determine “whether ‘legal constraints external to the parties’ agreement
foreclosed arbitration.’” Id.
About the first step, that Plaintiff and Capital One agreed to arbitrate the
matters at issue in this case is clear. In Graulau I, the parties stipulated that
Plaintiff’s claims -- claims identical to those asserted in this case -- were subject to
binding arbitration under the applicable cardholder agreement.
Nevertheless, Plaintiff now contends that the arbitration agreement is
unenforceable for these reasons: (1) Credit One waived its right to arbitration;
(2) Plaintiff lacks the financial resources to pay the costs of arbitration; and (3)
Plaintiff’s claims are exempt from arbitration under 28 U.S.C. § 654(a) and Middle
District of Florida Local Rule 8.02(a). We are unpersuaded.
First, nothing evidences that Credit One waived its right to arbitration. To
establish waiver, a party must show two things: “(1) the party seeking arbitration
substantially participated in litigation to a point inconsistent with an intent to
arbitrate; and (2) that this participation resulted in prejudice to the opposing party.”
Burch, 861 F.3d at 1350. Never has Credit One engaged in substantial
participation in this litigation. To the contrary -- in both this case and in Graulau I
5 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 6 of 7
-- Credit One’s conduct consisted only of efforts to enforce the arbitration
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USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 1 of 7
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT ________________________
No. 20-12037 Non-Argument Calendar ________________________
D.C. Docket No. 6:19-cv-01723-WWB-GJK
JESSICA GRAULAU,
Plaintiff-Appellant,
versus
CREDIT ONE BANK, N.A., a foreign corporation,
Defendant-Appellee.
________________________
Appeal from the United States District Court for the Middle District of Florida ________________________
(May 6, 2021)
Before LAGOA, BRASHER, and EDMONDSON, Circuit Judges. USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 2 of 7
PER CURIAM:
Plaintiff Jessica Graulau, proceeding pro se, 1 appeals the district court’s
order (1) dismissing Plaintiff’s civil action against Defendant Credit One Bank,
N.A. (“Credit One”) and (2) referring Plaintiff’s case to arbitration. In her
complaint, Plaintiff asserted against Credit One violations of the Telephone
Consumer Protection Act, 47 U.S.C. § 277 (“TCPA”), and of the Florida
Consumer Collection Practices Act, Fla. § 559.72 (“FCCPA”). No reversible error
has been shown; we affirm.
This appeal arises from alleged attempts by Credit One to collect Plaintiff’s
consumer debt. Plaintiff says she -- over a period of fifteen months -- received
thousands of robocalls from Credit One, despite having instructed Credit One’s
agents to stop calling her.
In January 2018, Plaintiff filed a counseled complaint against Credit One,
asserting violations of the TCPA and the FCCPA (“Graulau I”). The parties later
filed a “Joint Stipulation Dismissing and Referring Case to Arbitration.” In
pertinent part, the joint stipulation provided that “Plaintiff, through counsel, . . .
agrees this case is subject to arbitration pursuant to the cardholder agreement.”
1 We read liberally briefs filed by pro se litigants. See Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008). 2 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 3 of 7
The parties requested that the district court dismiss the case and refer the matter to
binding arbitration. On 10 April 2018, the district court entered an order referring
Graulau I to arbitration and dismissing the case.
Then, in September 2019, Plaintiff filed pro se the civil action underlying
this appeal. Plaintiff again asserted against Credit One claims for violation of the
TCPA and the FCCPA based on the same factual allegations asserted in Graulau I.
Plaintiff alleged that she had been unable to file an arbitration demand due to a
lack of financial resources.
Credit One moved to dismiss Plaintiff’s complaint and to enforce the 10
April 2018 order entered in Graulau I.
A magistrate judge issued a report and recommendation (“R&R”),
recommending that the district court grant Credit One’s motion, refer Plaintiff’s
claims to arbitration, and dismiss the case. The magistrate judge noted the parties’
joint stipulation in Graulau I that Plaintiff’s claims against Credit One were subject
to binding arbitration. The magistrate judge then determined that Plaintiff had
failed to show that arbitration would be prohibitively expensive or that
enforcement of the arbitration agreement would preclude Plaintiff from effectively
vindicating her rights. Plaintiff filed no timely objections to the R&R. 2
2 Generally speaking, a party that fails to object to the magistrate judge’s R&R waives the right to challenge on appeal a district court’s order based on the unobjected-to factual and legal 3 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 4 of 7
The district court adopted the R&R, granted Credit One’s motion, ordered
Plaintiff to “submit to arbitration in accordance with the Joint Stipulation,” and
dismissed the case.
We review de novo a district court’s order compelling arbitration. See
Emp’rs Ins. of Wausau v. Bright Metal Specialties, Inc., 251 F.3d 1316, 1321 (11th
Cir. 2001).
Through the Federal Arbitration Act, 9 U.S.C. § 1 et seq. (“FAA”), Congress
“declare[d] a national policy favoring arbitration of claims that parties contract to
settle in that manner.” See Burch v. P.J. Cheese, 861 F.3d 1338, 1345 (11th Cir.
2017) (quotation omitted). We have said that this “strong federal preference for
arbitration of disputes . . . must be enforced where possible.” See Musnick v. King
Motor Co., 325 F.3d 1255, 1258 (11th Cir. 2003). Among other things, the FAA
authorizes a district court “to issue an order compelling arbitration if there has been
a failure, neglect, or refusal to comply with an arbitration agreement.” Id. (citing 9
U.S.C. § 4).
In ruling on a motion to compel arbitration pursuant to section 4 of the FAA,
a district court follows a two-step inquiry. Klay v. PacifiCare Health Sys., Inc.,
conclusions. See 11th Cir. R. 3-1. That waiver rule does not apply in this case, however, because the R&R never informed Plaintiff about the time for objecting and about the consequences on appeal for failing to object. See id. 4 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 5 of 7
389 F.3d 1191, 1200 (11th Cir. 2004). First, the district court must “determine
whether the parties agreed to arbitrate the dispute.” Id. If so, the district court
must then determine “whether ‘legal constraints external to the parties’ agreement
foreclosed arbitration.’” Id.
About the first step, that Plaintiff and Capital One agreed to arbitrate the
matters at issue in this case is clear. In Graulau I, the parties stipulated that
Plaintiff’s claims -- claims identical to those asserted in this case -- were subject to
binding arbitration under the applicable cardholder agreement.
Nevertheless, Plaintiff now contends that the arbitration agreement is
unenforceable for these reasons: (1) Credit One waived its right to arbitration;
(2) Plaintiff lacks the financial resources to pay the costs of arbitration; and (3)
Plaintiff’s claims are exempt from arbitration under 28 U.S.C. § 654(a) and Middle
District of Florida Local Rule 8.02(a). We are unpersuaded.
First, nothing evidences that Credit One waived its right to arbitration. To
establish waiver, a party must show two things: “(1) the party seeking arbitration
substantially participated in litigation to a point inconsistent with an intent to
arbitrate; and (2) that this participation resulted in prejudice to the opposing party.”
Burch, 861 F.3d at 1350. Never has Credit One engaged in substantial
participation in this litigation. To the contrary -- in both this case and in Graulau I
5 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 6 of 7
-- Credit One’s conduct consisted only of efforts to enforce the arbitration
agreement.
Plaintiff’s argument about the cost of arbitration also fails. An arbitration
agreement may be rendered unenforceable when arbitration would be prohibitively
expensive. See Green Tree Fin. Corp.-Ala. v. Randolph, 531 U.S. 79, 90 (2000).
The party seeking to avoid arbitration based on cost bears the “burden of
establishing that enforcement of the agreement would preclude him from
effectively vindicating his federal statutory right in the arbitral forum.” Musnick,
325 F.3d at 1259 (quotations and alterations omitted). To satisfy this burden, a
party “has an obligation to offer evidence of the amount of fees he is likely to
incur, as well as of his inability to pay those fees.” Id. at 1260.
Here, Plaintiff offered no specific evidence about the costs she might incur
in arbitration. Plaintiff’s mere conclusory assertion that she lacks the financial
resources to pay for arbitration is not enough to invalidate the arbitration
agreement. See Musnick, 325 F.3d at 1260 (in deciding the enforceability of an
arbitration agreement’s fee-shifting provision, concluding a statement that plaintiff
would “be unable to pay” a potential award of attorney’s fees was speculative and
“wholly inadequate to establish that the arbitration would result in prohibitive costs
that force him to relinquish his claim under Title VII.”).
6 USCA11 Case: 20-12037 Date Filed: 05/06/2021 Page: 7 of 7
We also reject Plaintiff’s arguments under 28 U.S.C. § 654 and the Middle
District of Florida’s local rules: provisions that are inapplicable to the FAA-based
arbitration agreement at issue in this case. See 28 U.S.C. § 651(e) (the statutory
provisions in 28 U.S.C. §§ 651 et seq. “shall not affect title 9, United States
Code.”); M.D. Fla. Local Rule 8.01(a) (repealed 1 February 2021) (implementing
rules in accord with 28 U.S.C. §§ 651-58).
Plaintiff has failed to show that the parties’ arbitration agreement is invalid
or unenforceable. We affirm the district court’s order dismissing the case and
referring the case to arbitration.
AFFIRMED.