United States District Court, E.D. New York
Donovan J. Clarke, Plaintiff,
Alltran Financial, LP f/k/a United Recovery Systems, LP, Defendant.
MEMORANDUM AND ORDER
F. BIANCO United States District Judge
Donovan J. Clarke (“plaintiff” or
“Clarke”) brings this putative class action
against Alltran Financial, LP, formerly known as United
Recovery Systems, LP (“defendant” or
“Alltran”) under the Fair Debt Collection
Practices Act (“the FDCPA”), 15 U.S.C. §
1692 et seq. Clarke claims that Alltran violated the
FDCPA by sending him an allegedly false and misleading debt
collection letter relating to amounts owed on his Citibank
before the Court is Alltran's motion to compel
arbitration on an individual basis under the credit card
agreement between Clarke and Citibank-to which Alltran is not
a signatory. The parties' dispute centers on whether
Alltran, as a non-signatory, can compel arbitration under
that agreement. Alltran asserts that it can compel
arbitration (1) based on the plain language of the card
agreement; (2) as a third-party beneficiary; (3) as
Citibank's agent; and (4) under the doctrine of equitable
estoppel. Clarke, in turn, disputes each of these grounds.
reasons that follow, the Court concludes that Alltran can
compel arbitration under the card agreement's plain
language, and, alternatively, as Citibank's agent.
Because the Court concludes that Alltran can compel
arbitration on these grounds, it does not reach Alltran's
Court further concludes that whether arbitration must proceed
on an individual basis under the card agreement's class
action waiver is for the arbitrator to decide.
the Court stays this action pending the arbitration.
Court takes the following facts from the complaint, the
Declaration of Terri Montgomery (“Montgomery
Decl.”) filed in support of defendant's motion to
compel arbitration, and the exhibits thereto.
October 2014, Citibank issued plaintiff a credit card.
(Montgomery Decl. ¶ 11.) In connection with obtaining
the credit card, plaintiff received a card agreement that
governed his account. (Id. ¶ 7.) The card
agreement provided that Clarke agreed to be bound by its
terms by either using the credit card or failing to cancel
the credit card within thirty days of receiving it.
(Montgomery Decl. Ex. 1 at 1.) The card agreement also
contained a broad arbitration provision that stated, in
PLEASE READ THIS PROVISION OF THE AGREEMENT CAREFULLY. IT
PROVIDES THAT ANY DISPUTE MAY BE RESOLVED BY BINDING
ARBITRATION. ARBITRATION REPLACES THE RIGHT TO GO TO COURT,
INCLUDING THE RIGHT TO A JURY AND THE RIGHT TO PARTICIPATE IN
A CLASS ACTION OR SIMILAR PROCEEDING.
Agreement to Arbitrate: Either you
or we may, without the other's consent, elect mandatory,
binding arbitration for any claim, dispute, or controversy
between you and us (called “Claims”).
What Claims are subject to arbitration? All
Claims relating to your account, a prior related account, or
our relationship are subject to arbitration, including Claims
regarding the application, enforceability, or interpretation
of this Agreement and this arbitration provision. All Claims
are subject to arbitration, no matter what legal theory they
are based on or what remedy (damages, or injunctive or
declaratory relief) they seek. This includes Claims based on
contract, tort (including intentional tort), fraud, agency,
your or our negligence, statutory or regulatory provisions,
or any other sources of law; Claims made as counterclaims,
cross-claims, third-party claims, interpleaders or otherwise;
and Claims made independently or with other claims. A party
who initiates a proceeding in court may elect arbitration
with respect to any Claim advanced in that proceeding by any
other party. Claims and remedies sought as part of a class
action, private attorney general or other representative
action are subject to arbitration on an individual
(non-class, non-representative) basis, and the arbitrator may
award relief only on an individual (non-class,
Whose Claims are subject to arbitration? Not
only ours and yours, but also Claims made by or against
anyone connected with us or you or claiming through us or
you, such as a co-applicant, authorized user of your account,
an employee, agent, representative, affiliated company,
predecessor or successor, heir assignee, or trustee in
Broadest Interpretation. Any questions about
whether Claims are subject to arbitration shall be resolved
by interpreting this arbitration provision in the broadest
way the law will allow it to be enforced. This arbitration
provision is governed by the Federal Arbitration Act (the
(Id. at 9-10.)
point before December 2015, plaintiff allegedly failed to
make payments on his Citibank credit card (Compl.
¶¶ 13, 16), and Citibank “retained and
authorized” Alltran to collect the amount owed
(Montgomery Decl. ¶ 6). To that end, Alltran sent a debt
collection letter to plaintiff on June 3, 2016. (See
Compl. Ex. A.) Clarke ...