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Johnston v. First Premier Bank

United States District Court, S.D. Ohio, Western Division

December 20, 2017




         This civil action is now before the Court on Defendant First PREMIER Bank's (“Defendant”) second motion to compel arbitration and dismiss Plaintiff Thomas P. Johnston's (“Plaintiff”) pro se Complaint. (Doc. 14). For the reasons discussed below, it is recommended that Defendant's second motion (Doc. 14) be GRANTED.

         I. Background and Facts

         When considering a motion to compel arbitration, “courts treat the facts as they would in ruling on a summary judgment motion, construing all facts and reasonable inferences that can be drawn therefrom in a light most favorable to the nonmoving party.” Raasch v. NCR Corp., 254 F.Supp.2d 847, 851 (S.D. Ohio 2003); see also Ackison Surveying, LLC v. Focus Fiber Solutions, LLC, Case No. 2:15-cv-2044, 2016 WL 4208145 (S.D. Ohio Aug. 10, 2016) (following Raasch). Therefore, the undersigned will look to the documents provided by the parties to lay the factual foundation and will construe those facts and any reasonable inferences that can be drawn therefrom in the light most favorable to Plaintiff in the analysis that follows.[1]

         This matter arises out of the credit reporting of a First PREMIER credit card account held in Plaintiff's name. Plaintiff's First PREMIER credit card was applied for electronically via Defendant's website in 2011. (Doc. 14-1, PageId. 77).[2] The First PREMIER Credit Card Application that was completed included certain initial disclosures. (Id.). Included in those initial disclosures was an Arbitration Notice stating, inter alia, that if issued a Credit Card, the Credit Card Contract would contain a binding arbitration provision and that any dispute “relating to your Credit Card Contract” would be resolved by binding arbitration. (Id.).

         Defendant opened a credit card account for Plaintiff that had the last four digits of 5971. (Id.). Defendant sent Plaintiff a new credit card and a copy of the Credit Card Contract and Account Opening Disclosures (the “Credit Card Contract”). (Id., PageId. 77-78). The Credit Card Contract established the terms and conditions of Plaintiff's account with Defendant and included an agreement to arbitrate “any claim, dispute or controversy . . . arising out of or relating in any way to this Contract, this Provision . . ., your Credit Account, any transaction on your Credit Account and our relationship[, ]” including claims based in “statutory law (federal and state)[, ]” with the American Arbitration Association or a mutually agreed arbitration organization pursuant to the Federal Arbitration Act, 9 U.S.C. §§ 1-16. (Id., PageId. 78, 86). Although the arbitration provision specifies a right to opt out within 30 days, Defendant did not receive an opt-out notice for the account. (Id., PageId. 79). The Credit Card Contract also indicates that it becomes effective upon the earlier of the first purchase made on the credit card or after 30 days from the date the credit card is issued absent a written notice to cancel. (Id., PageId. 78, 86). Purchases were made using Plaintiff's credit card. (Id., PageId. 78). Billing statements related to the use of the credit card were sent to Plaintiff at 4137 Club View Drive, Cincinnati, Ohio 45209-1414. (Id.).

         On February 21, 2017, Plaintiff initiated this action in the Hamilton County, Ohio Municipal Court based on his allegations that Defendant violated the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. 1681, et seq. and the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. 1692, et seq. (Doc. 5, PageId. 14). Plaintiff's claims focus on the credit reporting of his account. (Id.). Defendant subsequently removed Plaintiff's case to this Court. (Doc. 1).

         On May 8, 2017, Defendant filed a motion to compel arbitration with the Court based on the arbitration agreement and contract terms for the account at issue. (Doc. 10). On May 19, 2017, the Court and the parties participated in a telephonic scheduling conference. During the conference, Plaintiff stated that he possesses documents demonstrating that the First PREMIER credit card at issue was opened fraudulently. Based on Plaintiff's representation, this Court denied Defendant's motion to compel arbitration on June 12, 2017. (Doc. 12). However, the Order indicated that “if Plaintiff fails to produce such documentation and/or should those representations prove to be inaccurate[, ] Defendant may refile the motion [to compel arbitration].” (Id., PageId. 49 fn. 1). Thereafter, Plaintiff filed a response to which he attached documents that he claims support his contention the credit card at issue was opened fraudulently. (Doc. 13). Those documents include an IRS Identify Theft Affidavit revised on April 2016 with a signature date of November 2011, an undated Identity Theft Victim's Complaint and Affidavit form, an Offense/Incident Report that includes a web address of Templat... along with an access date of February 6, 2017, several pages from a March 10, 2014 Equifax credit report that include a tagline for a First PREMIER account opened on February 17, 2011 and closed at the consumer's request that had a balance of $420.00 past due as of July 2011, and letters from 2009 relating to a Capital One fraud investigation for Stacey Baker. (Doc. 13, PageId. 52-62).

         Now before the Court is Defendant's second motion to compel arbitration wherein Defendant contends that documents provided by Plaintiff do not support his claim that the credit card at issue was opened fraudulently and that an order compelling arbitration is appropriate. (Doc. 14, PageId. 64-74). Plaintiff has filed a response in opposition, arguing that Defendant cannot show he signed or otherwise agreed to arbitration because he is the victim of identity theft. (Doc. 15, PageId. 88-90). Plaintiff again attaches the documents he claims reflect the credit card at issue was opened fraudulently, providing additional explanations for the same. (Doc. 15-1, PageId. 104-14). He also raises additional arguments pertaining to Ohio Usury Law, the FDCPA, the FCRA, and the use of courts for resolution of consumers' legal rights, which he supports by reference to a case against First PREMIER, articles about First PREMIER, and an article about consumer arbitration. (Id., PageId. 94-103). In its reply, Defendant reiterates its position that Plaintiff has failed to demonstrate he was the victim of identity theft and contends that the additional arguments raised by Plaintiff are immaterial to the Court's consideration of whether to compel arbitration. (Doc. 16, PageId. 116-19). Without leave of Court, Plaintiff filed a sur-reply in which he reiterates arguments made in his opposition brief. (Doc. 17, PageId. 123-24).

         II. Analysis

         Defendant moves to compel arbitration under the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1, et seq. (Doc. 14, PageId. 68). The FAA reflects a strong federal policy favoring arbitration. Decker v. Merrill Lynch, Pierce, Fenner & Smith, 205 F.3d 906, 911 (6th Cir. 2000). It “was designed to override judicial reluctance to enforce arbitration agreements, to relieve court congestion, and to provide parties with a speedier and less costly alternative to litigation.” Stout v. J.D. Byrider, 228 F.3d 709, 714 (6th Cir. 2000). Pursuant to the FAA, a written agreement to arbitrate disputes “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for revocation of any contract.” 9 U.S.C. § 2. “[A]ny doubts regarding arbitrability should be resolved in favor of arbitration.” Glazer v. Lehman Bros., Inc., 394 F.3d 444, 451 (6th Cir. 2005) (citing Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983)).

         Before compelling arbitration pursuant to a contractual arbitration provision, however, the Court must make four threshold determinations:

first, it must determine whether the parties agreed to arbitrate; second, it must determine the scope of that agreement; third, if federal statutory claims are asserted, it must consider whether Congress intended those claims to be nonarbitrable; and fourth, if the court concludes that some, but not all, of the claims in the action are subject to arbitration, it must determine whether to stay the remainder of the proceedings pending arbitration.

Glazer, 394 F.3d at 451 (quoting Stout, 228 F.3d at 714) (internal quotations omitted). Upon a finding of arbitrability, the Court must order the parties to proceed to arbitration in accordance with the terms of the agreement. 9 U.S.C. § 4. “[T]he party resisting arbitration bears the burden of proving that the claims at issue are unsuitable for ...

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