On Wednesday, a Ninth Circuit panel reversed the district court’s denial of a motion to compel arbitration in a suit against PeopleConnect LLC, instead remanding the case with instructions for the parties to conduct arbitration-relevant discovery. The case concerns the defendant’s use of the plaintiff’s image and likeness without her consent on its website Classmates.com, a school yearbook database.
The questions on appeal asked which law applies to the dispute and whether the plaintiff must arbitrate her claim. Relevant to the latter question is the fact that the plaintiff’s counsel created a Classmates.com account for her, searched for her name, and found her identity in its database prior to filing suit.
As previously reported, the Seattle, Wash. court declined Classmates’ arbitration argument, finding that under Ohio law, Ohio being the plaintiff’s state of residence, she did not assent to Classmates’ terms of service. In so ruling, the court rejected PeopleConnect’s argument that the plaintiff’s lawyer acted as her agent and assented to the terms of service on her behalf.
In its reversal, the Ninth Circuit said that the district court erred in applying Ohio law. The opinion said that when, as here, no conflict exists between Washington and another state’s possibly applicable law, Washington law says to apply the forum’s law.
As to the second question of arbitrability, the tribunal said that questions of fact precluded judicial decision. Specifically, the court concluded that issues of agency, including whether the plaintiff and her counsel had an agency relationship when the latter assented to the terms of service, the extent of the agency relationship, and whether the plaintiff ratified her counsel’s agreement to arbitrate even if the attorney initially lacked authority to bind her.
The Ninth Circuit said that PeopleConnect had a right to conduct discovery on these issues before the district court rules on the motion to compel and remanded for further proceedings.