Court Compels Arbitration in Consumer Suit Against Verizon

Alyce Fraher’s complaint against Verizon Wireless Services LLC over billing and service issues has been sent to arbitration, after the Southern District of California’s ruling on Monday. Judge Marilyn L. Huff sided with the cellular provider, finding its arbitration agreement binding and rejecting the plaintiff’s request to send the case back to state court.

The opinion explained that after deciding to purchase a phone for her son in March 2018 from a Best Buy retail store, the plaintiff listened to an employee describe the terms of service, then signed on a tablet, giving her consent to Verizon’s terms and conditions of use, including the arbitration provision at issue. This March, Fraher filed a complaint in the San Diego County Superior Court, alleging that she encountered various issues with defendant’s services and that she was billed her for services that she either did not agree to pay for or did not receive.

The complaint stated claims for negligence, and violations of the California’s Consumer Credit Agency Reporting Act and its Unfair Competition Law. Shortly thereafter, the plaintiff added a federal Fair Credit Reporting Act (FCRA) claim. Once the federal claim was added, Verizon removed the case, then moved to compel arbitration.

In this week’s opinion, the court considered whether to enforce the arbitration agreement, and secondarily, whether to remand the plaintiff’s complaint, now without the FCRA claim, to state court. The court upheld the comprehensive arbitration clause after determining that Verizon demonstrated that Fraher assented to it.

Judge Huff overrode the plaintiff’s contention that she was unaware of the agreement to arbitrate when she signed for her purchase. The court reasoned that under California law, the plaintiff “cannot now avoid the arbitration terms because she neglected to read them at the time.”

As to the question of remand, Judge Huff explained that because Fraher’s complaint included a federal claim at the time of removal, the court has jurisdiction to adjudicate her remaining state law claims. In such situations, the court may either maintain or relinquish its jurisdiction over those claims. In this case, Judge Huff retained jurisdiction and dismissed the case, writing that “declining to exercise jurisdiction would only delay the inevitable: that this case must be sent to arbitration.”

The plaintiff is represented by Henderson Consumer Law, and the defendant by YU Mohandesi.