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Harris v. Mariner Finance LLC

United States District Court, E.D. Virginia, Richmond Division

August 28, 2019



          M. Hannah Lauck, United Stalls District Judge.

         This matter comes before the Court on five motions:

(1) Defendant Mariner Finance, LLC's ("Mariner") Motion to Enforce the Parties' Agreement, Compel Arbitration, and to Dismiss the Amended Complaint (the "Motion to Compel Arbitration"), [1] (ECF No. 3);[2]
(2) Plaintiff Lamont Harris's Motion to Remand, (ECF No. 7);[3]
(3) Harris's Letter Motion, (ECF No. 9);[4]
(4) Harris's Motion to Dismiss "Defendants Claims and Immediate Judgment in the Favor of the Plaintiff ("Harris's Motion to Dismiss"), (ECF No. II);[5] and,
(5) Mariner's "Motion to Strike Plaintiffs 'Response in Support of Dismissal of Defendant's Claims and Immediate Judgment in Favor of the Plaintiff" (the "Motion to Strike"), (ECF No. 13).[6]

         This matter is ripe for disposition. The Court dispenses with oral argument because the materials before it adequately present the facts and legal contentions, and argument would not aid the decisional process. The Court exercises jurisdiction pursuant to 28 U.S.C. § 1331.[7] For the reasons that follow, the Court will grant the Motion to Compel Arbitration and dismiss this action without prejudice. The Court will deny Harris's Motion to Remand and Harris's Letter Motion. The Court will also deny as moot Harris's Motion to Dismiss and Mariner's Motion to Strike.

         I. Factual and Procedural History

         A. General Allegations and Procedural History[8]

         In August 2013, Harris, a Virginia resident, served as a co-signor for a vehicle purchased at a Virginia car dealership, Auto By Design, LLC. (Am. Compl. ¶ 4; Mem. Supp. Mot. Compel 1, ECF No. 4.) As part of the vehicle purchase, Harris and the buyer entered into a Retail Installment Sale Contract (the "Loan Contract"), which allegedly contained an addendum entitled "Notice of Arbitration Agreement"[9] (the "Arbitration Agreement").[10] (Mem. Supp. Mot. Compel 1.)

         On the same day that Harris and the buyer purchased the car, Auto By Design, LLC assigned the car loan to Mariner, a Maryland limited liability corporation. (Id.) Specifically, the Loan Contract stated "Seller[11] assigns its interest in this contract to Mariner Finance." (Mem. Supp. Mot. Compel Ex. A "Loan Contract" 4, ECF No. 4-1.)

         Harris alleges that the vehicle purchased through the Loan Contract "was repossessed and resold in 2015." (Harris's Mot. Dismiss 1-2, ECF No. 11.)

         Harris's four claims arise out of Mariner's alleged violations of the Fair Credit Reporting Act (the "FCRA") when Mariner, among other things, furnished information about a debt Harris allegedly owed after he submitted "proof... to the contrary, as well as written notification from all 3 credit bureaus." (Am. Comp. ¶ 11.) Harris also states that Mariner violated the FCRA when it "failed to respond to ... disputes," "illegally pulled his credit report without his permission," and "pulled" his "credit report without his permission, in addition to obtaining information under false pretenses." (Id. ¶¶ 14, 19, 26.)

         Harris originally filed his Amended Complaint in the Circuit Court for the City of Richmond (the "Richmond Circuit Court"). (Not. Removal 1.) Mariner properly removed the action to this Court invoking the Court's federal question jurisdiction under 28 U.S.C. § 1331 because Harris's Amended Complaint seeks relief solely under the FCRA. See 28 U.S.C. § 1441(a).

         After removing the case to this Court, Mariner filed the instant Motion to Compel Arbitration. Harris's Motion to Remand, Letter Motion, and his Motion to Dismiss followed. In response to Harris's Motion to Dismiss, Mariner filed the Motion to Strike.

         B. Allegations Related to the Arbitration Agreement

         Mariner attached the executed Loan Contract and Arbitration Agreement as exhibits to its Memorandum in Support of the Motion to Compel Arbitration. (See ECF No. 4-1.) Mariner also attached a sworn declaration (the "Declaration") from a Branch Manager attesting, under penalty of perjury, that the documents constituted "a true and authentic copy of the at-issue Retail Installment Sale Contract and its Addendum,[12] both executed by Lamont Harris on August 17, 2013." (Decl. 1, ECF No. 4-2.) The Declaration states that the Loan Contract and the Arbitration Agreement "comprise the entire agreement between Lamont Harris and the assignee, Mariner Finance, LLC." (Id. 2.)

         The Arbitration Agreement specifies that the Federal Arbitration Act, 9 U.S.C. § 1 (the "FAA"), governs the Arbitration Agreement and that it broadly applies

to any claim, dispute, or controversy (whether based upon contract, tort, intentional or otherwise, constitution, statute, common law, or equity and whether preexisting, present or future), including initial claims ... arising from or relating to: this contract the closing, servicing, collection, or enforcement of the contract; or the relationships that result from this contract (Claim)[.]

         (Arbitration Agreement 1, ECF No. 4-1.) The Arbitration Agreement excludes certain claims from the scope of this broad application, stating:

(1) we may exercise lawful self-help remedies (such as repossession of collateral) and we may proceed in court for garnishment, repossession, replevin, and foreclosure remedies; and (2) you or we may bring a lawsuit in court to recover up to $5, 000.00 (including costs and attorneys' fees) for yourself or ourselves only, not for any class or group of persons having similar claims......We also agree not to elect to arbitrate an individual Claim you bring in small claims court or an equivalent court, so long as the Claim is pending only in that court.

(Id.) Although the Arbitration Agreement states that "[y]ou may reject this arbitration agreement... by sending a rejection notice ... within 60 days after the date of this contract" to a specified address, nothing in the record indicates that Harris ever rejected the Arbitration Agreement. (Id.)

         Rather, Harris maintains throughout his numerous filings that he never signed the Arbitration Agreement. (See, e.g., Resp. Mot. Compel 1, ECF No. 7.) Harris also states that "he has never seen these statements, contacts [sic], agreements, nor even had any prior conversations with the defendants pertaining to any arbitration agreements." (Id. 2.) He avers that at the time he acted as a cosigner on the loan he "was actually working as a car salesman at a car dealership & are [sic] familiar and trained on handling arbitration agreements, contract agreements, etc." (Harris's Mot. Dismiss 3.) Although Harris maintains that his purported signature on the Arbitration Agreement constitutes a forgery, he provides nothing beyond his own assertions to support his forgery contention.

         II. Analysis

         The Court Will Grant the Motion to Compel Arbitration and Dismiss this Case to Allow Harris and Mariner to Arbitrate Harris's FCRA Claims[13]

         A. The Federal Arbitration Act

         Congress passed the FAA "'to reverse the longstanding judicial hostility to arbitration agreements ... and to place arbitration agreements upon the same footing as other contracts.'" Green Tree Fin. Corp.-Ala. v. Randolph, 531 U.S. 79, 89 (2000) (quoting Gilmer v. Interstate/ Johnson Lane Corp., 500 U.S. 20, 24 (1991) (alteration in original)). The FAA provides that a written agreement to arbitrate "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2. Section 2 limits the scope of the FAA to written contracts involving commerce. Id. "The effect of th[is] section is to create a body of federal substantive law of arbitrability, applicable to any arbitration agreement within the coverage of the Act." Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24(1983).

         Once a court determines that the parties entered into a written agreement to arbitrate the underlying dispute, Section 4 directs courts to compel arbitration if necessary. 9 U.S.C. § 4. The FAA gives district courts no discretion to do otherwise:

By its terms, the Act leaves no place for the exercise of discretion by a district court, but instead mandates that district courts shall direct the parties to proceed to arbitration on issues as to which an arbitration agreement has been signed. Thus, insofar as the language of the Act guides [the] disposition of [a] case, we would conclude that agreements ...

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