District Court (Cal.) Orders TCPA and FDPCA Claims to Arbitration

In Delgado v. Progress Financial Co., 2014 WL 1756282 (E.D.Cal. 2014), Judge O’Neill ordered a Plaintiff’s TCPA and FDCPA claims to arbitration.

Mr. Delgado does not dispute that he signed the Arbitration Agreement at the time he applied for a loan from Progreso Financiero; nor does he dispute the validity of the agreement. Doc. 14 at 2. Mr. Delgado argues, however, that the allegedly tortious conduct at issue falls outside the scope of the Arbitration Agreement and is therefore actionable under the TCPA and RFDCPA. . . . Mr. Delgado alleges that Progreso Financiero’s use of an automatic dialing system and prerecorded voice to contact him about the repayment status of his loan is not related in any way to the Loan Agreement. Yet, Mr. Delgado signed a “Disclosure Form”, which specifically attested to the fact that he agreed to “ac-cept calls, SMS text messages, emails and other elec-tronic communications from us regarding your loan application, your loan payments, the collection of your loan account …” and that he understood that “these calls could be automatically dialed and a recorded message may be played.” Doc. 12–5 at 7 (emphasis added). ¶  This Court finds that Progreso Financiero’s ability collect payment due under the terms of Mr. Delgado’s Loan Agreement is “related to” that contract within the context of the FAA. Here, the Agreement’s broad language, which explicitly includes “all claims” including “tort” and “intentional tort” encompasses Progreso Financiero’s debt collection related activities, including practices discussed in the Disclosure Form—such as use of text messages and pre-recorded callsfor the narrow purpose of Defendant’s ability to contact Plaintiff about his loan account, payments and collections. This finding is consistent with case law from our sister district courts in the Ninth and Eleventh Circuits. See Section V(I), infra. The decision reached by the Wagner court in the District of Colorado is distinguished by the fact that the Defendant in that case could not point to any part of the contract that governed manner of collection. Wagner, 2014 WL 128372 at *5. In contrast, the Disclosure form Mr. Delgado signed identified various methods Progreso Financiero anticipated it might employ to communi-cate with Mr. Delgado about his account. The facts of Jiffy Lube, are also distinct in that the communications at issue in that case were for the purposes of soliciting future business and not related to the terms of the underlying contract.

The Court also rejected the Plaintiff’s argument that the Rosenthal Act claims could not be arbitrated.

 Mr. Delgado claims that his RFDCPA claims are not subject to the FAA because the RFDCPA does not permit waiver of a debtor’s right to a jury trial. Doc 14 at 14. Defendant disagrees with Plaintiff’s reading of the RFDCPA. Doc. 17 at 10. The Court, however, does not need to resolve this issue because even if Plaintiff’s interpretation is correct, the FAA preempts state law. AT & T Mobility, 131 S.Ct. at 1747 (“When state law prohibits outright the arbitration of a particular type of claim, the analysis is straightforward: The conflicting rule is displaced by the FAA.”); see also Allied–Bruce Terminix Companies, Inc. v. Dobson, 513 U.S. 265, 281 (1995) (“What States may not do is decide that a contract is fair enough to enforce all its basic terms (price, service, credit), but not fair enough to enforce its arbitration clause.”) Accordingly, this Court orders parties to arbitrate Plaintiff’s Rosenthal Act claims.