In Hearn v. Comcast Cable Communications, LLC, the Eleventh Circuit Court of Appeals reversed a district court holding denying the defendant’s motion to compel arbitration regarding the plaintiff’s Fair Credit Reporting Act claim and remanded the matter for further proceedings.
In that case, the plaintiff obtained services from the defendant in 2016, and signed a subscriber agreement with an arbitration provision stating that “[a]ny dispute involving [the customer] and Comcast shall be resolved through individual arbitration.” The plaintiff terminated his services in 2017, but subsequently called the defendant in 2019 to “inquire about pricing and obtaining services” again. The plaintiff alleged that one of the defendant’s representatives impermissibly checked his credit information during the call, and his credit score consequentially dropped. Accordingly, the plaintiff filed a putative class-action suit, alleging the defendant violated the FCRA when the defendant’s representative checked his credit without his consent. The defendant moved to compel arbitration pursuant with the subscriber agreement.
The district court denied the defendant’s motion to compel arbitration, holding that the plaintiff’s FCRA claim was outside the scope of the subscriber agreement as it did not “ar[ise] out of” or “relate to” the subscriber agreement. The plaintiff claimed that he called to open a new account with the defendant rather than to reconnect services. Conversely, the defendant claimed that the plaintiff “called and inquired about pricing for reconnecting services.” The district court resolved the factual dispute in favor of the plaintiff, and thus, denied the defendant’s motion to compel arbitration. The defendant appealed.
On appeal, the Eleventh Circuit Court of Appeals reversed the district court holding and remanded the matter for further proceedings. On appeal, the defendant contended that: (1) the court should enforce the arbitration agreement provision in the subscriber agreement pursuant with Eleventh Circuit precedent demonstrating that “the FAA requires courts to enforce valid arbitration agreements, including agreements as broad as the one at issue here”; and (2) the plaintiff’s FCRA claim was subject to arbitration because, even under “the district court’s limited construction of the FAA,” the FCRA claim “relate[d] to the Subscriber Agreement.”
Although the court did not analyze whether the full scope of the arbitration provision within the subscriber agreement was enforceable, it reasoned that the plaintiff’s FCRA claim arose out of and related to the underlying subscriber agreement for a few reasons. First, consistent with precedent, it reasoned that the defendant’s representative was able to check his credit information “only because of its previous relationship with [the plaintiff].” Second, it reasoned that the reconnection, credit inquiries, and termination provisions of the subscriber agreement established “duties relating to [the defendant’s] alleged unlawful credit inquiry,” thus establishing a “direct relationship between the dispute and the performance of duties specific by the contract.” Although the plaintiff contended that he terminated his services in 2017 and was not attempting to “reconnect” services within the meaning of the reconnection provision in the agreement, the court disagreed. It held that, within the context of the entire agreement, including language utilized in the termination provision, it was clear that the reconnection provision was applicable to the plaintiff.
Further, the court held that even if it accepted the plaintiff’s claim that he called to open a new account with the defendant rather than to reconnect services, the plaintiff’s FCRA claim still related to the subscriber agreement, as the plaintiff was calling to “inquire about obtaining Comcast’s services at [his address] again,” and the reconnection provision “explicitly addresse[d] situations where customers seek to resume and reinstate Comcast services.”
Therefore, the Court of Appeals held that the FCRA claim related to the subscriber agreement, reversed the district court’s holding denying the defendant’s motion to compel arbitration, and remanded the matter for further proceedings.