District Court (Az.) Orders FDCPA Case against Vehicle Finance Co. to Arbitration; Says Arbitrator Will Decide if Claims Are Outside the Scope of RISC’s Arbitration Clause

In Johnson v. Santander Consumer USA Inc., 2015 WL 7567483, at *2-3 (D.Ariz., 2015), Judge Rayes ordered an FDCPA case to arbitration under a standard Arizona Automobile RISC.

Both the RISC and the Amendment contain arbitration provisions that clearly and unmistakably delegate questions of arbitrability to the arbitrator. The RISC requires arbitration for any disputes “in contract, tort, statute or otherwise (including the interpretation and scope of this clause, and the arbitrability of the claim or dispute)…which arise out of or relate to your credit application, purchase or condition of this vehicle, this contract or any resulting transaction or relationship[.]” (Doc. 12-1 at 3 (emphasis added).) Similarly, the Amendment provides: “Any claim or dispute…(including, without limitation, interpretation and the scope of the provision, the arbitrability of any issue and matters relating to the consummation, servicing, collection or enforcement of this contract or note)” shall be arbitrated. (Id. at 6 (emphasis added).) The language of both provisions clearly and unmistakably delegates authority to the arbitrator to determine the threshold question of arbitrability. See Momot, 652 F.3d at 988 (finding similar language clearly articulated the parties’ intent for questions of arbitrability to go to the arbitrator).  Plaintiffs argue the Court must determine whether their claims fall within the scope of the arbitration agreement. But none of the cases they cite are binding authority, and none are on point with this case. See Cummings v. FedEx Ground Packaging Sys., Inc., 404 F.3d 1258, 1261 (10th Cir. 2005) (delegation of authority to arbitrator to determine questions of arbitrability not at issue); P&P Indus., Inc. v. Sutter Corp, 179 F.3d 861, 871 (10th Cir. 1999) (threshold arbitrability questions not at issue); Fuqua v. Kenan Advantage Corp., No. 3:11-cv-01463-ST, 2012 WL 2861613, at *10 (D. Or. April 13, 2012) (arbitration provision did not expressly delegate questions of arbitrability to the arbitrator). Instead, the cases merely state the principle that courts generally determine the scope of an arbitration provision in the absence of a delegation of authority to the arbitrator to determine such issues. This is not the case here, and Plaintiffs do not otherwise challenge the language of the RISC or the Amendment. They have therefore failed to meet their burden of establishing the arbitration provisions are inapplicable, see Wynn Resorts, 497 F. App’x at 742, and the issue of arbitrability will be decided by the arbitrator.