Eleventh Circuit Reverses District Court’s Denial of Motion to Compel Arbitration in Putative FCRA Class Action

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On April 5, 2021, the Eleventh Circuit reversed a district court’s denial of a defendant’s motion to compel arbitration in a Fair Credit Reporting Act (“FCRA”) lawsuit arising from a former Comcast customer’s re-application for services, holding that the FCRA claim related to a prior agreement that contained an arbitration provision. The case is noteworthy in that it involved a particularly sweeping arbitration provision—applying broadly to all disputes between the parties, even those arising after the services agreement was terminated—that the Eleventh Circuit had not previously considered. The court ultimately did not reach the question of the provision’s enforceability, however, instead remanding the case to the district court to determine its enforceability in the first instance.

  • Plaintiff Michael Hearn first obtained Comcast services for his residence in December 2016, which he later terminated in August 2017. He called Comcast in March 2019 to inquire about re-starting services at the same address. Plaintiff characterized the call as requesting to open a “new account,” while Comcast characterized the call as an inquiry about “reconnecting services.”
  • When Plaintiff called in March 2019, Comcast allegedly ran an unauthorized credit check without Plaintiff’s knowledge or permission. The credit inquiry caused Plaintiff’s credit score to decline. Plaintiff subsequently brought a putative class action pursuant to the FCRA based on this unauthorized credit inquiry.
  • When Plaintiff first obtained services in December 2016, he signed an acknowledgment that he had received a “Subscriber Agreement.” The Agreement contained an arbitration clause, which stated: “Any dispute involving [the customer] and Comcast shall be resolved through individual arbitration.” The Agreement defined “dispute” as “any claim or controversy related to Comcast, including but not limited to any and all . . . claims that arise after the expiration or termination of this Agreement.”
  • Based on this provision, Comcast filed a motion to compel arbitration, which the district court denied on the basis that “no reasonable person would believe that the Arbitration Provision was so all-encompassing as to apply to all claims regardless of when they occurred or whether they related to the agreement.” The district court further stated that it had to give credit to Plaintiff’s characterization that he was calling to open a new account and not to reconnect services. Therefore, the court found that Plaintiff’s FCRA claim did not relate to the prior Agreement.
  • The Eleventh Circuit disagreed. Upon review of the provisions of the Agreement, including the reconnection, credit inquiries, and termination provisions, the panel found that the Agreement contained specific duties relevant to the challenged March 2019 credit inquiry. The panel emphasized that Comcast could not have even run the credit inquiry without the personal information it collected from Plaintiff pursuant to the prior Agreement.
  • Based on its findings, the panel concluded that the FCRA claim related to the Agreement based on (1) the liberal federal policy favoring arbitration agreements; (2) the relevant provisions in the Subscriber Agreement applicable to Plaintiff; and (3) “the fact that Comcast would not have access to [Plaintiff’s] personal information—and therefore could not have engaged in the allegedly tortious conduct—but for the pre-existing Agreement.”
  • The Eleventh Circuit emphasized that its holding was “narrow.” The panel did not decide whether the provision could apply broadly to all disputes even after the Agreement is terminated. Instead, the panel acknowledged that “[w]hile the language in some of our prior decisions may indicate that the full scope of the Arbitration Provision is enforceable, this is a close question that we leave for another day.”
  • The case is Hearn v. Comcast Cable Communications, No. 19-14455, 2021 WL 1246263 (11th Cir. 2021), and the Eleventh Circuit’s opinion can be accessed here.

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