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Fuller v. Frontline Asset Strategies, LLC

United States District Court, N.D. Illinois, Eastern Division

April 11, 2018

Janis Fuller, individually and on behalf of a class of persons similarly situated, Plaintiffs,
v.
Frontline Asset Strategies, LLC, LVNV Funding LLC, and Resurgent Capital Services, L.P., Defendants.

          MEMORANDUM OPINION AND ORDER

          Ronald A. Guzmán United States District Judge.

         For the reasons stated below, the motion to stay the individual claims, dismiss the class claims, and compel arbitration [15] is granted.

         STATEMENT

         Background

         Plaintiff Janis Fuller applied for and received a credit card from Credit One Bank, N.A (“Credit One”). She ultimately defaulted on the amount owed, and Credit One sold her account, which was ultimately transferred and assigned to LVNV Funding, LLC (“LVNV”). Plaintiff alleges LVNV is a debt collector as defined by the Fair Debt Collection Practices Act (“FDCPA”). (Compl., Dkt. # 1, ¶¶ 13-17.) Frontline Asset Strategies, LLC (“Frontline”) was hired to collect the debt. (Id. ¶ 25.) On or about November 1, 2016, Frontline sent Plaintiff a collection letter, which she alleges threatened legal action against her that could not be taken, and thus violated various subsections of the FDCPA. See 15 U.S.C. §§ 1692e, 1692e(5), 1692e(10). She sues Defendants on behalf of herself and a class of similarly situated individuals. Defendants move to stay the individual claims, dismiss the class claims, and compel arbitration.

         Analysis

         As recently noted by the Seventh Circuit:

Section 2 of the Federal Arbitration Act “reflect[s] both a ‘liberal federal policy favoring arbitration' and the ‘fundamental principle that arbitration is a matter of contract.'” It requires federal courts to “place arbitration agreements on an equal footing with other contracts and enforce them according to their terms.” We will compel arbitration under the Federal Arbitration Act “if three elements are present: (1) an enforceable written agreement to arbitrate, (2) a dispute within the scope of the arbitration agreement, and (3) a refusal to arbitrate.”
However, because arbitration agreements are contracts, a “party ‘cannot be required to submit to arbitration any dispute which he has not agreed so to submit.'” Therefore, the general rule is that non-signatories are not bound to arbitration agreements. We will enforce an arbitration agreement against a non-signatory if the party seeking to compel arbitration can show that an exception to this general rule applies.

A.D. v. Credit One Bank, N.A., No. 17-1486, 2018 WL 1414907, at *3 (7th Cir. Mar. 22, 2018) (internal citations omitted). It is undisputed that Plaintiff has refused to arbitrate; thus, the third element has been met.

         Enforceable Agreement to Arbitrate. Defendants assert that the terms and conditions of the Cardholder Agreement, Disclosure Statement, and Arbitration Agreement (“Agreement”) that governs Plaintiff's account with Credit One, which is now owned by LVNV, prohibits lawsuits and requires binding arbitration. Specifically, Defendants note that the Agreement states, in relevant part:

This Agreement, together with the application you previously signed and the enclosed Arbitration Agreement, governs the use of your VISA or Mastercard Account issued by Credit One Bank, N.A. (The “Account, ” “Card”, or “Card Account”). The words “you”, “your” and “Cardholder(s)” refer to all persons, jointly and severally, authorized to use the Card Account; and “we, ” “us, ” and Credit One Bank refer to Credit One Bank, N.A., its successors or assigns. By requesting and receiving, signing or using your Card, you agree as follows:
IMPORTANT NOTICE: Please read the Arbitration Agreement portion of this document for important information about your and our legal rights ...

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