18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 641 consented to arbitration with third-parties, as the arbitration agreement expressly stated that it was between the customer and T-Mobile. For these reasons, the Court denied Apple’s motion to compel. Ohanian, et al. v. Apple, Inc., 2021 U.S. Dist. LEXIS 199352 (S.D.N.Y. Oct. 14, 2021). Plaintiff, a mobile cellular phone customer, filed a class action alleging that Defendants engaged in fraudulent omissions and false representations relative to the data privacy and security of its mobile devices. Defendant T-Mobile moved to compel arbitration pursuant to an arbitration provision contained in its terms and conditions. The Court denied the motion. To consider the issue, the Court held an evidentiary hearing to determine whether a valid agreement to arbitrate between T-Mobile and Plaintiff existed. The Court heard testimony from Brian Anderson, a representative of T-Mobile, and from Plaintiff. Additionally, the Court considered five exhibits, including: (i) the receipt Plaintiff received when he activated his T-Mobile service on April 19, 2016, (ii) the Form that contained the arbitration provision and that was generated in T-Mobile’s OpenText system in the course of Ohanian’s transaction, (iii) a different version of the prepaid confirmation form that T-Mobile previously claimed to have provided Plaintiff, (iv) a screenshot of metadata from the OpenText system; and (v) a post in Russian made by Plaintiff on Telegram. Id . at *2. The Court found that T-Mobile failed to demonstrate that it actually provided Plaintiff with the Form that contained the arbitration agreement. The Court determined that whether there was an objective meeting of the minds, it must look to the elements of offer and acceptance. The Court opined that Defendant did not establish that there was an offer made by T-Mobile to Plaintiff to establish these elements. For these reasons, the Court denied T-Mobile’s motion to compel arbitration. Perez, et al. v. Discover Bank , Case No. 20-CV-6896 (N.D. Cal. Sept. 23, 2021). Plaintiffs, a group of participants of Deferred Action for Childhood Arrivals (“DACA”), filed a class action alleging that Defendant denied load applications on the basis of their citizen status. Defendant filed a motion to compel arbitration of Plaintiffs’ claims, and the Court granted the motion. Included with Defendant’s loan application was a promissory note that included an arbitration agreement. Plaintiff Perez filled out a private consolidation loan application and electronically signed the induced promissory note, which included a sentence stating that Defendant’s agreement would be “effective and enforceable when you affix your signature and deliver it to us.” Id . at 3. Plaintiff Magana completed and electronically signed Defendant’s graduate student loan application, which included an arbitration agreement using the same language. Plaintiffs argued that the arbitration agreements were not valid because they lacked mutual assent and were unconscionable. Defendant argued that Plaintiffs assented to the terms of the agreement when they electronically signed and submitted their loan applications. The Court found that the parties mutually assented to the agreements. Plaintiffs contended that the loans were unconscionable because Plaintiffs could not negotiate the terms of the agreement, did not have meaningful alternatives for funds, and the agreement disproportionately favored Defendant. The Court ruled that the consolidation agreement was not unconscionable because Plaintiffs were free to walk away from and reject the agreement. The Court also determined that Plaintiffs’ claims were within the scope of the agreement. For these reasons, the Court granted Defendant’s motion to compel arbitration. Ramirez, et al. v. Electronic Arts , 2021 U.S. Dist. LEXIS 43032 (N.D. Cal. March 5, 2021). Plaintiff, a consumer, filed a class action alleging that Defendant’s “Ultimate Team Packs” violated California’s gambling laws. Defendant filed a motion to compel arbitration based on the arbitration agreement contained in the user agreement that Plaintiff signed in order to use Defendant’s games. The Court granted Defendant’s motion. The Court found that there was an agreement to arbitrate between the parties, as Plaintiff did not dispute that he signed the agreement and it covered the claims at issue. Accordingly, the Court determined that Plaintiff’s acceptance of Defendant’s user agreement, and in turn the arbitration provision, was sufficient to show that an agreement to arbitrate was formed. Id . at *9. Plaintiff contended that the entire agreement was unenforceable because it barred his right to obtain public injunctive relief. Defendant asserted that the arbitration agreement properly incorporated the rules of the American Arbitration Association (“AAA”), and therefore disputes regarding the validity of an arbitration agreement should be decided by an arbitrator. The Court agreed with Defendant’s position. It found that incorporation of the AAA rules into the agreement led to a finding of a clear and unmistakable delegation of issues of arbitrability to the arbitrator. Id . at *10. The Court thus held that the issue between the parties, i.e ., whether the arbitration provision was unenforceable because it limited Plaintiff’s ability to seek public injunctive relief, was clearly a matter regarding the validity of the arbitration provision. Id . at *11- 12. Accordingly, the Court granted Defendant’s motion to compel arbitration.