American Express vendor compels arbitration in FDCPA class action

By Takesha Thomas | Feb 21, 2019

Judge Gerald Pappert  

PHILADELPHIA - A vendor for American Express Bank has won a request to have arbitration proceedings in a class action. 

On Feb. 12, U.S. District Judge Gerald Pappert granted Firstsource Advance LLC's motion to compel arbitration in a case involving Dayo Brown. Brown sued Firstsource, a debt collector which acts as a vendor for American Express, claiming that the company violated the Fair Debt Collection Practices Act (FDCPA). 

Judge Pappert ruled in part that the parties shall arbitrate the claim. 

"Brown’s contention that the court must find 'express' or 'clear and unmistakable intent' to arbitrate FDCPA claims in the agreement before compelling arbitration of his claim conflicts with the court’s duty to resolve doubts concerning the scope of the arbitration clause in favor of arbitration," Pappert wrote. 

"As there is no dispute that FDCPA claims are subject to arbitration, generally and it is at most ambiguous as to whether the clause at issue encompasses Brown’s claim, the court must compel arbitration."

Pappert also ruled that the matter will remain in civil suspense "pending the outcome of arbitration."

Brown, an American Express cardmember, knowingly signed the cardmember agreement that contained the arbitration clause, a fact to which he does not argue. Brown instead questions the validity of the arbitration clause. 

According to court filings, Brown claims the arbitration clause is “overly broad.” He contends that if the clause can encompass his claim against Firstsource, a third party, it could encompass “any dispute resulting from any relationship between the parties,” leading to an “absurd result.”

"Brown does not support his challenge to the enforcement of the clause — 'strictly a legal one' — with reliable evidence (or any evidence) that he did not intend to be bound by the arbitration clause," Pappert wrote. "Brown offers nothing to show that discovery on the issue of contract formation is warranted."

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