Prodigy Finance CM2020-1 DAC v. Joshua John Nduwamungu

• Court: District Court, N.D. California
• Decided: April 22, 2026
• Docket: 5:25-cv-02236
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 SAN JOSE DIVISION 7 8 PRODIGY FINANCE CM2020-1 DAC, Case No. 25-cv-02236-VKD

9 Petitioner, ORDER FOR REASSIGNMENT TO A DISTRICT JUDGE 10 v. REPORT AND RECOMMENDATION 11 RE PROPOSED STIPULATED JOSHUA JOHN NDUWAMUNGU, CONSENT JUDGMENT 12 Respondent. Re: Dkt. Nos. 25, 27 13 14 In this action to confirm a foreign arbitration award concerning a student loan agreement, 15 petitioner Prodigy Finance CM2020-1 DAC (“Prodigy”) has filed a stipulation for entry of a 16 consent judgment (Dkt. No. 25) and an amended proposed form of judgment (Dkt. No. 27). For 17 the reasons discussed below, the Court recommends that the amended proposed judgment be 18 entered. 19 REPORT AND RECOMMENDATION 20 I. BACKGROUND 21 On March 4, 2025, Prodigy filed a petition to confirm a July 24, 2023 foreign arbitration 22 award, made by the Chartered Institute of Arbitrators (“Chartered Institute”) in London, England, 23 in favor of Prodigy and against Joshua John Nduwamungu in a contract dispute concerning a 24 student loan. Dkt. No. 1. Prodigy’s petition alleges the following: 25 Prodigy is a designated activity company limited by shares, incorporated under the laws of 26 Ireland, with its registered address in Dublin, Ireland. Dkt. No. 1 ¶ 1. Mr. Nduwamungu is an 27 individual with a last known address in Santa Clara County, California. Id. ¶ 2. In October 2020, 1 Finance Limited. Id. ¶ 9. Under that agreement, Prodigy Finance Limited agreed to loan 2 $46,280.00 to Mr. Nduwamungu, with the funds to be released to the University of Notre Dame- 3 Mendoza College of Business, where Mr. Nduwamungu was enrolled as a student. See id.; see 4 also Dkt. No. 1-2 at 2; Dkt. No. 1-3 at 3.1 Pursuant to the agreement, Prodigy Finance Limited 5 subsequently assigned the loan to Prodigy and provided Mr. Nduwamungu notice of the 6 assignment. See Dkt. No. 1 ¶¶ 10, 11; Dkt. No. 1-3 at 13; Dkt. No. 1-4. In May 2021, Prodigy 7 notified Mr. Nduwamungu that it varied the terms and conditions of the agreement, along with a 8 hyperlink to access those terms. See Dkt. No. 1-5. 9 After Mr. Nduwamungu defaulted on the loan in January 2022, Prodigy initiated 10 arbitration proceedings with Chartered Institute on May 25, 2023. See Dkt. No. 1 ¶¶ 17-23. On 11 July 24, 2023, the arbitrator issued an award (“Final Award”) in Prodigy’s favor, requiring Mr. 12 Nduwamungu to pay Prodigy the principal sum of $53,514.52, plus simple interest accruing at a 13 rate of 10.25% per annum (calculated by the arbitrator as $4,571.03) from September 14, 2022 14 until the date of final payment, as well as costs in the amount of $5,120.00.2 See Dkt. No. 1-2; see 15 also Dkt. No. 1 ¶ 26 & n.2. 16 Prodigy filed the present action to confirm the July 24, 2023 Final Award, asserting that 17 Mr. Nduwamungu has not made any payment on that award. Dkt. No. 1 ¶ 27. Prodigy invokes 18 the Court’s federal question jurisdiction under 28 U.S.C. § 1331 and the New York Convention on 19 the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958 (“New York 20 Convention”). Id. ¶¶ 3, 4. The docket indicates that Mr. Nduwamungu was served with process 21 in Sunnyvale, California. See Dkt. No. 15; see also Dkt. No. 21-1 ¶ 3; Dkt. No. 22. He did not 22 respond to Prodigy’s petition. On May 29, 2025, at Prodigy’s request, the Clerk of the Court 23 entered Mr. Nduwamungu’s default. Dkt. Nos. 17, 18. 24

25 1 All pin cites to court filings refer to the page number appearing in the ECF header on each document. 26

2 Although the Final Award states the award of costs in the amount of ₤4,000 GBP, Prodigy’s 27 petition seeks costs of $5,120.00 based on the exchange rate for GBP in effect on July 24, 2023. 1 Prodigy filed a motion for default judgment on August 25, 2025 (Dkt. No. 21). The Court 2 terminated that motion without prejudice, noting that the motion did not adequately address 3 subject matter jurisdiction, personal jurisdiction, service of process, or the Eitel3 factors. The 4 Court gave Prodigy leave to file a renewed motion for default judgment. See Dkt. No. 24. 5 Rather than renew its motion for default judgment, Prodigy filed a purported stipulation for 6 the entry of a consent judgment. Dkt. No. 25. The stipulation appends a copy of a settlement 7 agreement (Dkt. No. 25-1), as well as a proposed judgment (Dkt. No. 25-2). The stipulation states 8 that the parties reached a settlement with respect to the total outstanding balance, identified as 9 $80,662.57. See id.; Dkt. No. 25-1, sec. 1.1. 10 The Court ordered supplemental briefing regarding the proposed stipulated consent 11 judgment. Dkt. No. 26. Among other things, the Court noted that the stipulated consent judgment 12 did not address the issues raised in the Court’s October 20, 2025 order, including subject matter 13 jurisdiction and whether the arbitral award or agreement at issue falls under the New York 14 Convention. Additionally, although Prodigy submitted a record indicating that Prodigy personnel 15 created and electronically signed certain document(s) (see Dkt. No. 25 at 5), Prodigy provided no 16 corresponding records or information regarding Mr. Nduwamungu’s apparent digital signatures on 17 those documents. Finally, the Court stated that the proposed judgment could not be signed in its 18 present form. Accordingly, the Court directed Prodigy to file supplemental briefing addressing the 19 following:

20 1. (a) Is the arbitral award or agreement in question “commercial in nature” such that the award or agreement falls under the New York 21 Convention? (b) Is the New York Convention otherwise properly invoked as the basis for the Court’s subject matter jurisdiction? See 22 Ministry of Def. of Islamic Republic of Iran v. Gould Inc., 887 F.2d 1357, 1362 (9th Cir. 1989) (“Under the plain meaning of [9 U.S.C. 23 § 202] then, three basic requirements exist for jurisdiction to be conferred upon the district court: the award (1) must arise out of a 24 legal relationship (2) which is commercial in nature and (3) which is not entirely domestic in scope.”). 25 2. Is the signature for Mr. Nduwamungu appearing on the stipulated 26 consent judgment (see Dkt. No. 25 at ECF 2) and on the appended settlement agreement (see 25-1 at ECF 4) a digital or typed/text 27 signature? If so, what are the circumstances by which his signature 1 was placed on these documents?[] As Mr. Nduwamungu is in default, the Court requires information beyond Prodigy’s counsel’s 2 attestation pursuant to Civil Local Rule 5-1(i)(3).

3 3. In any event, the proposed judgment cannot be signed in its present form. The proposed judgment states that the “undersigned 4 signatory” is authorized to enter the consent judgment for Prodigy. It also states that the “undersigned Respondent has elected to 5 proceed without counsel and is agreeing to all the terms of this Consent Judgment freely and voluntarily” and “has read, 6 understood, agrees, and consents to this Consent Judgment and Order and all of the terms and conditions set herein.” However, the 7 only signature block on the proposed judgment is for the Court. See Dkt. No. 25-2. 8 9 Dkt. No. 26 at 2-3. 10 Prodigy filed supplemental briefing, along with an amended proposed form of judgment. 11 Dkt. No. 27. Because Mr. Nduwamungu is in default, this Court does not have the consent of all 12 parties to magistrate judge jurisdiction. 28 U.S.C. § 636(c); Fed. R. Civ. P. 73: Williams v. King, 13 875 F.3d 500 (9th Cir. 2017). The Court directs the Clerk of the Court to reassign this action to a 14 district judge, with the recommendation that the amended proposed judgment be entered. 15 II. DISCUSSION 16 Approval of a proposed consent judgment is within the Court’s sound discretion. See 17 United States v. State of Oregon, 913 F.2d 576, 580 (9th Cir. 1990). While a court may not simply 18 blindly approve such proposed judgments, “the court’s approval is nothing more than an amalgam 19 of delicate balancing, gross approximations and rough justice.” Id. (quotation modified; citation 20 omitted). “The court need only be satisfied that the decree represents a reasonable factual and 21 legal determination.” Id. (quotation modified; citation omitted). 22 With respect to subject matter jurisdiction, “[t]he Federal Arbitration Act [FAA] provides 23 that the New York Convention is enforceable in the United States and that federal district courts 24 have original jurisdiction of actions falling under the Convention.” Smagin v. Yegiazaryan, 37 25 F.4th 562, 565 (9th Cir. 2022); see also Jones Day v. Orrick Herrington & Sutcliffe LLP, 42 F.4th 26 1131, 1133 (9th Cir. 2022) (“Congress enacted Chapter Two of the [FAA] . . . to provide for the 27 effective and efficient resolution of international arbitral disputes after the United States entered 1 be deemed to arise under the laws and treaties of the United States,” and “[t]he district courts of 2 the United States . . . shall have original jurisdiction over such an action or proceeding, regardless 3 of the amount in controversy.” 9 U.S.C. § 203. To fall under the New York Convention, “three 4 basic requirements exist for jurisdiction to be conferred upon the district court: the award (1) must 5 arise out of a legal relationship (2) which is commercial in nature and (3) which is not entirely 6 domestic in scope.” Ministry of Def. of Islamic Republic of Iran v. Gould Inc., 887 F.2d 1357, 7 1362 (9th Cir. 1989). 8 This Court is satisfied that the arbitration award in question arises out of a legal 9 relationship between Prodigy and Mr. Nduwamungu that is not entirely domestic in scope. The 10 legal relationship here is a contract between Prodigy, an Irish corporation, and Mr. Nduwamungu, 11 who is said to currently reside in Santa Clara County, California. See Dkt. No. 1 ¶¶ 1, 2. See 9 12 U.S.C. § 202; HayDay Farms, Inc. v. FeeDx Holdings, Inc., 55 F.4th 1232, 1239 (9th Cir. 2022) 13 (“Arbitration awards that, as here, involve at least one foreign party are governed by the 14 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (‘Convention’), June 15 7, 1959, 21 U.S.T. 2517, which Congress incorporated into federal law in the FAA.”); New 16 Frontier Inv. AG v. BitCenter, Inc., 715 F. Supp. 3d 1245, 1252-53 (N.D. Cal. 2024) (same). 17 Prodigy has not cited, nor has this Court found, authority clearly stating whether an a 18 student loan agreement is “commercial in nature” for purposes of the New York Convention. 19 While “[t]he New York Convention, as codified in the FAA, does not define the term 20 ‘commercial,’” at least one circuit court has concluded that “[i]n the context of international 21 arbitration, ‘commercial’ refers to matters or relationships, whether contractual or not, that arise 22 out of or in connection with commerce.” Belize Soc. Dev. Ltd. v. Gov’t of Belize, 794 F.3d 99, 23 103-104 (D.C. Cir. 2015). “The text of the FAA’s codification of the New York Convention is 24 consistent with this conclusion,” as the New York Convention “expressly encompass[es] any 25 ‘transaction, contract, or agreement described in’ 9 U.S.C. § 2,” which “in turn includes contracts 26 ‘evidencing a transaction involving commerce,’” a term the Supreme Court has interpreted 27 broadly to “signal the broadest permissible exercise of Congress’ Commerce Clause power.” Id. 1 a non-frivolous claim that the subject arbitral award is covered by the New York Convention and 2 that the Court has subject matter jurisdiction over this action. See Al-Qarqani v. Chevron Corp., 8 3 F.4th 1018, 1025 (9th Cir. 2021) (“[S]o long as a party makes a non-frivolous claim that an 4 arbitral award is covered by the Convention, the court ‘must assume subject matter jurisdiction 5 and hear the merits of the case.’”) (quoting Sarhank Grp. v. Oracle Corp., 404 F.3d 657, 660 (2d 6 Cir. 2005)). 7 With respect to Mr. Nduwamungu’s signature, Prodigy has submitted additional 8 documents supporting the authenticity of his digital signature on the stipulated consent judgment 9 on and the parties’ settlement agreement, which appear to be collectively referred to as “Consent 10 Agreement” in the parties’ respective signing histories. See Dkt. No. 27-1 ¶¶ 3, 4 & Exs. 1 & 2; 11 see also Dkt. No. 25. Documents filed elsewhere in the docket indicate that after agreeing in 12 principle to settle the matter in June 2025, Prodigy made several unsuccessful attempts to follow 13 up with Mr. Nduwamungu to discuss a final agreement. See Dkt. No. 19 ¶ 11; see also Dkt. No. 14 21-1 ¶ 8. While the Court notes that the top-level email submitted with Prodigy’s amended 15 proposed consent judgment lacks a header identifying to whom that email was sent and when (see 16 Dkt. No. 27-1, Ex. 1), other documents indicate that Mr. Nduwamungu agreed to settlement terms 17 and to the stipulation for entry of a consent judgment in October 2025 (Dkt. No. 27-1, Ex. 2), and 18 Prodigy did so in November 2025 (Dkt. No. 25). In any event, to the extent any questions remain 19 regarding Mr. Nduwamungu’s signatures or the documents and terms to which he agreed, Prodigy 20 is directed to serve Mr. Nduwamungu with a copy of this order and report and recommendation, as 21 set forth below, so that he has an opportunity to object. 22 With respect to the proposed form of judgment, Prodigy has submitted an amended form of 23 judgment, omitting language indicating that the Court purported to make certain representations 24 on behalf of each party. See Dkt. No. 27-2. 25 III. CONCLUSION 26 Because not all parties have appeared in this action or consented to magistrate judge 27 jurisdiction, the Clerk of Court shall reassign this case to a district judge. The Court recommends 1 (Dkt. No. 27). 2 Prodigy shall serve Mr. Nduwamungu with a copy of this report and recommendation and 3 file a proof of service with the Court by May 4, 2026. 4 Any party may serve and file objections to this report and recommendation within 14 days 5 after being served. 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72; Civil L.R. 72-3. 6 IT IS SO ORDERED. 7 || Dated: April 22, 2026 8 9 Virginia K. DeMarchi 10 United States Magistrate Judge 11 a 12 13

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