Vernon v. Qwest Communications International, Inc.

925 F. Supp. 2d 1185, 2013 WL 752155, 2013 U.S. Dist. LEXIS 35843
CourtDistrict Court, D. Colorado
DecidedFebruary 27, 2013
DocketCivil Action No. 09-cv-01840-RBJ-CBS
StatusPublished
Cited by30 cases

This text of 925 F. Supp. 2d 1185 (Vernon v. Qwest Communications International, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vernon v. Qwest Communications International, Inc., 925 F. Supp. 2d 1185, 2013 WL 752155, 2013 U.S. Dist. LEXIS 35843 (D. Colo. 2013).

Opinion

ORDER

R. BROOKE JACKSON, District Judge.

This matter comes before the Court on plaintiffs’ objection to an order issued by United States Magistrate Judge Craig B. Shaffer granting defendants’ renewed motion to compel arbitration and staying this matter pending further proceedings. For the reasons set forth herein, the Court denies the plaintiffs’ objection and affirms the magistrate judge’s recommendation.

Facts

The plaintiffs are former customers of Qwest who signed up for its “Price for Life” program which was a minimum two-year contract under which subscribers were guaranteed a discounted rate for as long as they maintained their service without change. Travis Leo Affidavit [# 27] ¶ 16. Subscribers who terminated the program within the first two years were charged a $200 early cancellation fee. Customers who elected to take monthly service without a two-year commitment lost their promotional rate after one year and were subject to possible rate increases. Id.

The Price for Life program was subject to a set of terms and conditions set forth in a Subscriber Agreement. [# 27-2], Paragraph 17 of the Subscriber Agreement, captioned “Dispute Resolution and Arbitration,” contains two provisions of particular importance to the present case. First, any dispute or claim arising out of or relating to the services provided by Qwest must be resolved in arbitration or in small claims court. Second, the subscriber waived his or her right to pursue any claims on a class or consolidate basis or in a representative capacity. Id. at 13.

Customers could sign up for the Price for Life program over the phone or via the Internet. To sign up over the phone a customer would first speak to a customer [1188]*1188service representative. After selecting their Internet service package, customers were transferred to a voice recording that told them that they had selected a multiyear package that was governed by the terms and conditions of the Subscriber Agreement. The recording said that the terms and conditions were located at www. qwest.com/legal, and it indicated that customers could cancel within 30 days without any early termination charge. [# 27-3].

Customers who enrolled vi a the Internet had to click a box to confirm that they agreed to a set of terms and conditions. The text informed customers that the terms and conditions of service were contained in a Subscriber Agreement, and the box asked customers to review the terms, including an arbitration agreement and limits on Qwest’s liability. Later in the checkout process the customers were informed that their Internet service was offered subject to the terms found at www. qwest.com/legal, again expressly including arbitration and limits on Qwest’s liability. [# 27-4],

Customers who purchased the service were given an installation disc. After loading the disc, known as the Quickconnect Install CD, a window would appear on the users’ computer screens notifying them that use of the service was subject to the terms of the Subscriber Agreement (referred to also as the “Qwest Agreement”), which could be found at www. qwest.com/legal, and which they should read. [# 27-5]. The window stated, in italicized and bold letters, that the Subscriber Agreement’s terms included arbitration and limits on Qwest’s liability. The text box also included the terms of a “license agreement” that did not contain an arbitration clause. [# 27-5]. However, it warned the consumer that if he or she clicked on the radio button labeled “I accept the terms of the license agreement,” that would be an electronic signature that acknowledged agreement that the Qwest Agreement contained the terms under which the service and equipment was provided, and that “you understand and agree to such terms (even if you don’t read them).” Id. at 2.

Finally, after subscribing to the Price for Life program, customers received a welcome letter. [# 27-6]. The welcome letter asked that customers please review important information on the back of the letter about terms of service. There the letter stated:

Your Qwest Broadband service and related products are offered under the High-Speed Internet Subscriber Agreement terms, which are located at www. qwest.com/legal/highspeedinternet subscriberagreement. Please review the terms, which include arbitration and limits on Qwest liability. If you do not agree, call Qwest to cancel your service within 30 days. Qwest updates the Subscriber Agreement from time to time and your continued use of the services constitutes your acceptance of any changes.

Id. at 3. Some of the plaintiffs do not remember receiving the welcome letter, but they do not dispute that they received it.

Plaintiffs are four individuals who terminated their participation in the Price for Life program within two years after enrolling in it. The specific facts of each of the four plaintiffs enrollment in the program are set forth in detail in Judge Shaffer’s order (hereafter “Magistrate Judge Order”) 857 F.Supp.2d 1135, 1146-48 (D.Colo.2012). Plaintiffs have been charged and have either paid or protested the payment of the $200 early cancellation fee.

Plaintiffs brought this action in the Western District of Washington in 2008 purporting to represent a multi-state class [1189]*1189of similarly situated consumers who were, in their view, subjected to an invalid $200 early termination fee. They have demanded a trial by jury. After some initial skirmishing in that court, including a ruling on a motion to dismiss, the court transferred the case to this district in August 2009.

Defendants, who had also filed a motion to compel in the Washington court, filed another motion to dismiss [# 25] and a motion to compel arbitration [# 26] in this Court. The motion to dismiss was denied by Judge Daniel as moot after plaintiffs’ Third Amended Complaint was filed. [# 58]. The motion to compel arbitration was later stayed pending the United States Supreme Court’s decision in AT & T Mobility, LLC v. Concepcion, and all pending motions were denied without prejudice. [# 110, # 121]. The Supreme Court issued its decision in that case on April 27, 2011. Defendants then filed a renewed motion to compel arbitration. [# 132], After full briefing and argument, the magistrate judge granted that motion. Plaintiffs objected to portions of that order, and those objections have been fully briefed.

Standard of Review

Magistrate Judge Shaffer determined that the motion was non-dispositive. Plaintiffs disagree. They argue that a motion to compel arbitration is a dispositive motion, and therefore, that the magistrate judge’s order must be deemed a report and recommendation and reviewed de novo. The law on this issue is not clear. Only one circuit court to my knowledge has addressed the issue. It held that a motion to compel arbitration is non-dispositive, because a district court retains jurisdiction to review the arbitration award. PowerShare, Inc. v. Syntel, Inc., 597 F.3d 10 (1st Cir.2010). District courts have come to varying conclusions on the matter. See, e.g. Coxcom, Inc. v. Egghead Telecom, No. 08-cv-698-TCK-PJC, 2009 WL 4016629, at *1 (N.D.Okla. Sept. 11, 2009) (magistrate judge noting that motions to compel are usually treated as dispositive and issuing a report and recommendation); Chen-Oster v. Goldman Sachs & Co., 785 F.Supp.2d 394, 399 n.

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925 F. Supp. 2d 1185, 2013 WL 752155, 2013 U.S. Dist. LEXIS 35843, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vernon-v-qwest-communications-international-inc-cod-2013.