Arbitration Clause – Cardholder Agreement

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7^th Circuit Court of Appeals

Case Name: A.D. v. Credit One Bank

Case No.: 17-1486

Officials: WOOD, Chief Judge, and RIPPLE and KANNE, Circuit Judges.

Focus: Arbitration Clause – Cardholder Agreement

A.D., by and through her mother, Judith Serrano, brought this putative class action under the Telephone Consumer Protection Act. She seeks compensation for telephone calls placed by Credit One Bank, N.A. (“Credit One”) to her telephone number in an effort to collect a debt that she did not owe. After discovery, Credit One moved to compel arbitration and to defeat A.D.’s motion for class certification based on a cardholder agreement between Credit One and Ms. Serrano. The district court granted Credit One’s motion to compel arbitration but certified for interlocutory appeal the question whether A.D. is bound by the cardholder agreement. We granted A.D.’s request for permission to appeal. See 28 U.S.C. § 1292(b). We now reverse the district court’s grant of Credit One’s motion to compel arbitration and remand for further proceedings consistent with this opinion. A.D. is not bound by the terms of the cardholder agreement to arbitrate with Credit One, and she has not directly benefited from the cardholder agreement such that equitable principles convince us to apply the arbitration clause against her.

Reversed and Remanded

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.