United States District Court, W.D. Oklahoma
(1) LESLIE BROWN, individually; (2) LESLIE BROWN, parent and next friend of H.B., a minor child; and (3) LESLIE BROWN, on behalf of all other putative plaintiffs, similarly situated, Plaintiffs,
v.
(1) BOB MOORE AUTO GROUP, L.L.C., a domestic limited liability company; (2) BMAG LUXURY 1, L.L.C., a domestic limited liability company; (3) JOZEF DAREN DABROWSKI; (4) TONY G. GRISSOM, individually and acting in his official capacity as an agent of Bob Moore Auto Group, L.L.C. and BMAG Luxury 1, L.L.C.; (5) JOHN DOE TOWING SERVICES; (6) JOHN DOE TOW TRUCK DRIVER #1; and (7) JOHN DOE TOW TRUCK DRIVER #2, Defendants.
ORDER
DAVID
L. RUSSELL, UNITED STATES DISTRICT JUDGE
Before
this Court is the Motion to Stay and Compel Arbitration filed
by Defendants Bob Moore Auto Group, L.L.C.
(“BMAG”); BMAG Luxury 1, L.L.C. (“BMAG
Luxury”); and Jozef Daren Dabrowski (collectively,
“Defendants” or “Bob Moore
Defendants”). See Doc. 7. Defendants move to
stay this action and compel all claims asserted by
Plaintiffs[1]against them to bilateral arbitration.
See id. at 1-2. The matter is fully briefed and at
issue. See Docs. 7, 9-10. Having considered the
parties' filings, the Court finds as follows.
I.
Background
This
dispute began with a car sale. Plaintiff Leslie Brown alleges
that she purchased a 2010 Audi Q5 SUV for her minor daughter,
H.B., from a Bob Moore auto dealership on or about September
27, 2018. See Doc. 1, at 4; Doc. 7, at 2, 4.
According to Ms. Brown, she signed paperwork effectuating the
vehicle's purchase; left $7, 000 in cash as a down
payment with Defendant Dabrowski, a dealership employee; and
drove the vehicle home to give to her daughter. See
Doc. 1, at 4. The Bob Moore Defendants recall events
differently: in their telling, Ms. Brown feigned forgetting
her checkbook, assured Mr. Dabrowski that she would return
the next morning with down payment money, and left with the
vehicle. See Doc. 7, at 2-3. The next day, a
back-and-forth between Ms. Brown and the dealership ensued
over whether she had, in fact, paid the down payment.
See Doc. 1, at 4-5; Doc. 7, at 2-3. Eventually, on
November 1, 2018, Ms. Brown returned the vehicle to the
dealership-though not before Defendants unsuccessfully
attempted to repossess it. See Doc. 1, at 6-7;
see also Doc. 7, at 3 & n.2. Based on these
events, Plaintiffs filed this suit on May 3, 2019, asserting
claims for conversion, embezzlement, fraud, conspiracy to
commit fraud, theft, breach of the peace, false imprisonment,
intentional infliction of emotional distress, and violations
of the Fair Debt Collection Practices Act and the Oklahoma
Consumer Protection Act. See id. at 7-18.
At
issue now is whether this Court is the appropriate forum in
which to adjudicate Plaintiffs' claims. Defendants argue
that, as part of the vehicle sale, Leslie Brown signed an
Agreement to Arbitrate. See Doc. 7, at 4-5; see
also Docs. 7-1, 7-2.[2] This arbitration agreement states, in
relevant part:
By entering into this Agreement to Arbitrate . . .,
Customer(s) and Dealership, including any Assignee
(collectively referred to as “The Parties”)
agree, except as otherwise provided in this Agreement, to
settle by binding arbitration any dispute between them
regarding: (1) the purchase/lease by Customer(s) of the
above-referenced Vehicle; (2) any products and services
purchased in conjunction with the Vehicle; (3) any financing
obtained in connection with the transaction; and/or (4) any
dispute with respect to the existence, scope or validity of
this Agreement. Matters that the Parties agree to arbitrate
include, but are not limited to, disputes related to the
Retail Purchase/Retail Lease Agreement and any documents
incorporated therein by reference (whether such reference is
made in the Agreement or in the document itself), the
application for and terms of financing for the transaction,
the Finance/Lease Contract, any alleged promises,
representations and/or warranties made to or relied upon by
the Parties, and any alleged unfair, deceptive, or
unconscionable acts or practices.
Doc.
7-2, at 1. The agreement also states that “the Parties
agree that by entering into this Agreement, they are waiving
their right to a jury trial and their right to bring or
participate in any class action or multi-plaintiff action in
court or through arbitration.” Id. Based on
this agreement, Defendants contend that all of
Plaintiffs' claims are subject to arbitration. See
generally Docs. 7, 10. Ms. Brown, unsurprisingly,
disagrees, launching myriad attacks on the arbitration
agreement and Defendants' power to enforce it. See
generally Doc. 9.
II.
Standard of Review
The
parties agree, and the contract evinces, that this dispute is
governed by the Federal Arbitration Act (“FAA”),
9 U.S.C. §§ 1-16. “The FAA applies to all
arbitration agreements ‘involving commerce,' and
creates a body of federal substantive law of arbitrability,
applicable to any arbitration agreement within coverage of
the Act.” Comanche Indian Tribe of Okla. v. 49,
L.L.C., 391 F.3d 1129, 1131 (10th Cir. 2004) (internal
quotation marks, citations, and brackets omitted).
“[E]stablish[ing] a liberal federal policy favoring
arbitration agreements, ” Epic Sys. Corp. v.
Lewis, 138 S.Ct. 1612, 1621 (2018), the FAA
“reflects the fundamental principle that arbitration is
a matter of contract, ” “places arbitration
agreements on an equal footing with other contacts, ”
and “requires courts to enforce [such agreements]
according to their terms.” Rent-A-Center, West,
Inc. v. Jackson, 561 U.S. 63, 67-68 (2010) (citations
omitted). Under the FAA, “[d]isputes are subject to
arbitration when a valid and enforceable arbitration
agreement exists, and when the dispute falls within the scope
of . . . the arbitration agreement.” Frazier v. W.
Union Co., 377 F.Supp.3d. 1248, 1257 (D. Colo. 2019).
Section
2, “the primary substantive provision” of the
FAA, Moses H. Cone Mem'l Hosp. v. Mercury
Constr. Corp., 460 U.S. 1, 24 (1983), provides in
pertinent part that
[a] written provision in any . . . contract evidencing a
transaction involving commerce to settle by arbitration a
controversy thereafter arising out of such contract or
transaction . . . 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. To “implement § 2's
substantive rule . . . ., a party may apply to a federal
court for a stay of the trial of an action ‘upon any
issue referable to arbitration under an agreement in writing
for such arbitration, '” and “a party
‘aggrieved' by the failure of another party
‘to arbitrate under a written agreement for
arbitration' may petition a federal court ‘for an
order directing that such arbitration proceed in the manner
provided for in such agreement.'”
Rent-A-Center, 561 U.S. at 68 (quoting 9 U.S.C.
§§ 3-4); see also Belnap v. Iasis
Healthcare, 844 F.3d 1272, 1280 (10th Cir. 2017). Once
the Court is “satisfied that the making of the
agreement for arbitration or the failure to comply therewith
is not in issue, ” it “shall . . . order . . .
the parties to proceed to arbitration in accordance with the
terms of the agreement.” 9 U.S.C. § 4.
While
“the presence of an arbitration [agreement] generally
creates a presumption in favor of arbitration, this
presumption disappears when the parties dispute the existence
of a valid arbitration agreement.” Bellman v.
i3Carbon, LLC, 563 Fed.Appx. 608, 613 (10th Cir. 2014)
(internal quotation marks and citations omitted); see
also Riley Mfg. Co. v. Anchor Glass Container Corp., 157
F.3d 775, 779 (10th Cir. 1998) (“[W]hen the dispute is
whether there is a valid and enforceable arbitration
agreement in the first place, the presumption of
arbitrability falls away.”). Thus, before a court may
consider an arbitration agreement's terms, “a
threshold matter . . . must be established”: the
“existence of an agreement to arbitrate.”
Avedon Eng'g, Inc. v. Seatex, 126 F.3d 1279,
1287 (10th Cir.1997). After all, if a party has not agreed to
arbitrate a dispute, she cannot be forced to do so. See
Dish Network, L.L.C. v. Ray, 900 F.3d 1240, 1243 (10th
Cir. 2018). Section 4 of the FAA “requires judicial
resolution of issues that go to the ‘making' of an
agreement for arbitration, ” and the Court may
“compel arbitration of a particular dispute” only
when it is “satisfied that the ‘making' of
the agreement to arbitrate is not at issue” Spahr
v. Secco, 330 F.3d 1266, 1269-70 (10th Cir. 2003)
(quoting Prima Paint Corp. v. Flood & Conklin
Mfg., 388 U.S. 395, 403-04 (1967)). The Court looks to
state law principles of contract formation to determine
whether an agreement to arbitrate exists in the first place.
See Howard v. Ferrellgas Partners, L.P., 748 F.3d
975, 979 (10th Cir. 2014).
Once
the Court finds that an arbitration agreement exists, it
ordinarily must address the question of
arbitrability, that is, “whether the parties have
submitted a particular dispute to arbitration.”
Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79,
83 (2002). But just as parties may agree to arbitrate the
merits of disputes, so too can they agree to delegate this
arbitrability question. See Belnap, 844 F.3d at 1280
(citing First Options of Chi., Inc. v. Kaplan, 512
U.S. 938, 943 (1995)). Delegation clauses in arbitration
agreements reflect the parties' agreement to
“arbitrate threshold issues concerning the arbitration
agreement” and “‘gateway' questions of
‘arbitrability,' such as whether the parties have
agreed to arbitrate or whether their agreement covers a
particular controversy.” Rent-A-Center, 561
U.S. at 68-69; see also Belnap, 844 F.3d at 1280
(“[W]hen parties agree that an arbitrator should decide
arbitrability, they delegate to an arbitrator all threshold
questions concerning arbitrability . . . ...