Williams v. Experian Info. Sols.

1

Erica Williams, Plaintiff, v. Experian Information Solutions Incorporated, Defendant.

No. CV-23-01076-PHX-DWL

United States District Court, D. Arizona

August 20, 2024

ORDER

Dominic W. Lanza, United States District Judge.

Erica Williams (“Plaintiff”) alleges that Experian Information Solutions, Inc. (“Defendant” or “Experian”) violated the Fair Credit Reporting Act (“FCRA”) by falsely stating, in a credit report produced to a non-party, that Plaintiff was deceased. (Doc. 1.) Defendant has, in turn, moved to compel arbitration. (Doc. 18.)

For the following reasons, the motion is granted, but only insofar as it seeks to compel arbitration pursuant to the April 2016 Arbitration Agreement.

BACKGROUND

I. Factual Background

On April 21, 2017, Plaintiff created “an online Experian account . . . for the purposes of monitoring [her] Experian credit report.” (Doc. 18-1 ¶ 3; Doc. 19-1 ¶ 2.) Defendant “is a ‘consumer reporting agency'” that “sells millions of consumer reports (often called ‘credit reports' or ‘reports') per day, and also sells credit scores.” (Doc. 1 ¶¶ 16, 24.)

On March 17, 2023, Plaintiff received a letter from non-party Discover Financial Services (“Discover”) regarding a Discover account associated with Plaintiff (“Discover Account”). (Id. ¶ 63.) The letter stated that “‘we are seeking payment from the assets of the deceased' to ‘pay the outstanding balance' for the Discover Account.” (Id. ¶ 64.)

On March 18, 2023, Plaintiff called Discover to pay the outstanding bill but “was informed by the representative at Discover that she could not pay the balance on her account because she was deceased.” (Id. ¶¶ 65-66.)

On March 20, 2023, Plaintiff called Defendant and other non-party credit reporting agencies. (Id. ¶ 68.) Defendant informed Plaintiff “that they were reporting [her] as deceased but needed documentation and proof of life to correct it.” (Id. ¶ 71.)

On March 21, 2023, Plaintiff “obtained a letter stating that she was not being reported as deceased by the Social Security Administration,” “which she faxed to Discover the same day.” (Id. ¶ 67.)

On March 31, 2023, “Plaintiff applied for a pre-approved Capital One credit card.” (Id. ¶ 72.) “Given that [Defendant] was the only [c]redit reporting [a]gency reporting Plaintiff as deceased, due to their inaccurate reporting, Plaintiff was not approved for a Capital One credit card.” (Id. ¶ 73.)

On April 18, 2023, Defendant stopped reporting Plaintiff as deceased. (Id. ¶ 71.)

On May 21, 2023, Plaintiff logged into her Experian account for the last time. (Doc. 18 at 6; Doc. 18-1 ¶ 5.)^[1]

On May 22, 2023, Plaintiff cancelled her Experian account. (Doc. 18 at 6; Doc. 18 1 ¶ 5; Doc. 19 at 13 [acknowledging that Plaintiff “maintained an Experian account” for six years].)

II. Relevant Procedural History

On June 12, 2023, Plaintiff initiated this action by filing the complaint. (Doc. 1.)

On December 18, 2023, Defendant moved to compel arbitration. (Doc. 18.)

On January 2, 2024, Plaintiff filed an opposition. (Doc. 19.)^[2]

On January 9, 2024, Defendant filed a reply. (Doc. 23.)

On January 12 and 16, 2024, Defendant filed notices of supplemental authority. (Docs. 25, 27.)

On February 7, 2024, Defendant filed a motion to stay discovery pending the resolution of the motion to compel arbitration. (Doc. 30.)

On February 23, 2024, after full briefing (Docs. 32, 33), the Court granted Defendant's stay request. (Doc. 34.)

On May 5, 2024, Plaintiff filed a notice of supplemental authority. (Doc. 35.)

On July 9, 2024, the Court issued a tentative ruling. (Doc. 37.)

On July 23, 2024, Plaintiff and Defendant filed notices of supplemental authority (Docs. 38, 39), and Defendant filed a response (Doc. 40).

On July 30, 2024, the Court heard oral argument. (Doc. 41.)

On August 6, 2024, Plaintiff filed supplemental briefing as authorized by the Court during oral argument. (Doc. 42.)

III. The Terms Of Use

Attached to Defendant's motion are four versions of the “terms of use” agreements that were in effect while Plaintiff had an Experian account: (1) the April 5, 2016 terms of use agreement (“April 2016 Terms of Use”) (Doc. 18-4); (2) the January 8, 2019 terms of use agreement (“January 2019 Terms of Use”) (Doc. 18-7); (3) the February 2, 2023 terms of use agreement (“February 2023 Terms of Use”) (Doc. 18-5); and (4) the April 3, 2023 terms of use agreement (“April 2023 Terms of Use”) (Doc. 18-6).^[3]

A. April 2016 Terms Of Use

There are two parties to the April 2016 Terms of Use: (1) the customer, who is defined as “you” or “User”; and (2) Experian Consumer Services (“ECS”). (Doc. 18-4 at 2.) The section entitled “Overview and Acceptance of Terms” includes the following definition of ECS:

For purposes of this Agreement, the terms “we,” “us” or “ECS” refer to ConsumerInfo.com, Inc., an Experian® company (also known as Experian Consumer Services), and referred to as “Experian” on the Websites, its predecessors in interest, successors and assigns, and any of its third party service providers (including, without limitation, cloud service providers) who ECS uses in connection with the provision of the Services to you.

(Id., capitalization omitted.)

The section entitled “Amendments” provides as follows:

This Agreement may be updated from time to time. You should check this Website regularly for updates to this Agreement. Each time you order, access or use any of the Services or Websites, you signify your acceptance and agreement, without limitation or qualification, to be bound by the then current Agreement. Modifications take effect as soon as they are posted to this Website (or any of the Websites, to the extent applicable to you), delivered to you, or reasonably made available to you in writing by ECS. However, no unilateral amendment will retroactively modify the parties' agreed-to dispute resolution provisions of this Agreement for then-pending disputes, unless the parties expressly agree otherwise in writing. In all other respects, any modification or update to the arbitration provision shall be governed by subsection (g) of the Agreement's “Dispute Resolution By Binding Arbitration” Section below.

(Id., capitalization omitted.)

The April 2016 Terms of Use also include an arbitration agreement (“April 2016 Arbitration Agreement”). (Id. at 3-4.) As for the scope of the April 2016 Arbitration Agreement, § (a) provides as follows:

ECS and you agree to arbitrate all disputes and claims between us arising out of this Agreement directly related to the Services or Websites, except any disputes or claims which under governing law are not subject to arbitration. This agreement to arbitrate is intended to be broadly interpreted and to make all disputes and claims between us directly relating to the provision of any Service and/or your use of any Website subject to arbitration to the fullest extent permitted by law. However, for the avoidance of doubt, any dispute you may have with us arising out of the Fair Credit Reporting Act (FCRA) relating to the information contained in your consumer disclosure or report, including but not limited to claims for alleged inaccuracies, shall not be governed by this agreement to arbitrate. The agreement to arbitrate otherwise includes, but is not limited to: claims arising out of or relating to any aspect of the relationship between us arising out of any Service or Website, whether based in contract, tort, statute (including, without limitation, the Credit Repair Organizations Act) fraud, misrepresentation or any other legal theory, claims that arise before this or any prior Agreement (including, but not limited to, claims relating to advertising), claims that are currently the subject of purported class action litigation in which you are not a member of a certified class, and claims that may arise after the termination of this Agreement.

For the purposes of this arbitration provision, references to “ECS,” “you,” and “us” shall include our respective parent entities, subsidiaries, affiliates, agents, employees, predecessors in interest, successors and assigns, websites of the foregoing, as well as all authorized or unauthorized users or beneficiaries of Services and/or Websites. Notwithstanding the foregoing, either party may bring an individual action in small claims court. You agree that, by entering into this Agreement, you and ECS are each waiving the right to a trial by jury or to participate in a class action. This Agreement evidences a transaction in interstate commerce, and thus the Federal Arbitration Act governs the interpretation and enforcement of this arbitration provision. The arbitration provision shall survive termination of this Agreement.

(Id., emphasis added.)

Section (c) of the April 2016 Arbitration Agreement further specifies, in relevant part, that:

The arbitration will be governed by the Commercial Dispute Resolution Procedures and the Supplementary Procedures for Consumer Related Disputes (collectively, “AAA Rules”) of the American Arbitration Association (“AAA”), as modified by this Agreement, and will be administered by the AAA.... All issues are for the arbitrator to decide, including the scope and enforceability of this arbitration provision as well as the Agreement's other terms and conditions, and the arbitrator shall have exclusive authority to resolve any such dispute relating to the scope and enforceability of this arbitration provision or any other term of this Agreement including, but not limited to any claim that all or any part of this arbitration provision or Agreement is void or voidable.

(Id. at 4.)

Section (g) of the April 2016 Arbitration Agreement provides customers with a right to opt out of modifications to the April 2016 Terms of Use:

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