United States District Court, W.D. Pennsylvania
THOMAS MICHAEL BROWN, an individual; on behalf of himself and all others similarly situated, Plaintiffs,
SKLAR-MARKIND a/k/a MARKIND LAW GROUP, P.C. a/k/a LAW OFFICES OF ANDREW SKLAR, P.C., ANDREW SKLAR, individually and in his official capacity, LLOYD MARKIND, individually and in his official capacity, JORDAN W. FELZER, individually and in his official capacity, and JOHN AND JANE DOES NUMBERS 1 THROUGH 25, Defendants.
CYNTHIA REED EDDY, Magistrate Judge.
I. Introduction and Background
Plaintiff Thomas Michael Brown filed a lawsuit, in his own behalf and on behalf of a putative class, stating a claim under the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq ., for Defendants' allegedly improper debt collection tactics. Defendants are Sklar-Markind, a/k/a Markind Law Group, P.C., a/k/a Law Offices of Andrew Sklar, P.C., ("Sklar-Markind"), attorneys Andrew Sklar, Lloyd Markind and Jordan W. Felzer, and 25 John and Jane Does. Complaint (ECF No. 1), at ¶¶ 3-8, 9-17. The John and Jane Does are, Plaintiff alleges, natural persons or business entities responsible for or involved in creating and/or implementing the unlawful debt collection practices. Id ., ¶ 8. Plaintiff identifies Defendants as debt collectors within the meaning of the FDCPA, and alleges that in their efforts to collect a debt he owed their client in a civil action filed in the Court of Common Pleas of Allegheny County, Pennsylvania, Defendants made false or misleading representations with regard to the character and legal status of his debt and his obligation to reimburse the cost of the debt collectors' services. Id ., at ¶¶ 22-23, 44-49. He further alleges "that the creditor of the Brown Obligation either directly or through intermediate transactions assigned, placed, or transferred the Brown Obligation to Sklar-Markind for collection." Id., at ¶ 21. While the Complaint does not identify the "creditor of the Brown Obligation, " it references a "Pennsylvania Simple Interest Vehicle Installment Contract" as the "only writing upon which the Defendants rely in order to claim attorneys fees." Id . ¶ 32.
Defendants filed a Motion to Compel Arbitration and Stay Proceedings (ECF No. 14), attaching the Pennsylvania Simple Interest Retail Installment Sales Contract ("Sales Contract") (ECF No. 14-1) Plaintiff executed with Woltz & Wind Ford, Inc. in February 2011, for the purchase of a 2011 Ford Fiesta. The Sales Contract, among other things, requires Plaintiff to arbitrate all claims arising out of or in relation to the application for credit, the contract, or "any resulting transaction or relationship." Woltz & Wind simultaneously assigned its rights, privileges and remedies to the Ford Motor Credit Company ("FMCC"). The Fiesta was ultimately repossessed, and FMCC retained Sklar-Markind to represent it in an action to recover the deficiency between the amount for which the repossessed vehicle was sold and the balance owed.
The Sales Contract contains a broad arbitration provision and class action waiver which states as follows:
READ THIS ARBITRATION AGREEMENT CAREFULLY AND IN ITS ENTIRETY
Arbitration is a method of resolving any claim, dispute, or controversy (collectively, a "Claim") without filing a lawsuit in court. Either you or Seller ("us" or "we") (each a "Party") may choose at any time, including after a lawsuit is filed, to have any Claim related to this contract decided by arbitration. Such Claims include but are not limited to the following: 1) Claims in contract, tort, regulatory or otherwise ; 2) Claims regarding the interpretation, scope, or validity of this clause, or arbitrability of any issue; 3) Claims between you and us, your/our employees, agents, successors, assigns, subsidiaries, or affiliates ; 4) Claims arising out of or relating to your application for credit, this contract, or any resulting transaction or relationship, including that with the dealer, or any such relationship with third parties who do not sign this contract .
RIGHTS YOU AND WE AGREE TO GIVE UP
If either you or we choose to arbitrate a Claim, then you and we agree to waive the following rights:
RIGHT TO A TRIAL, WHETHER BY A JUDGE OR JURY
RIGHT TO PARTICIPATE AS A CLASS REPRESENTATIVE OR A CLASS MEMBER IN ANY CLASS CLAIM YOU MAY HAVE AGAINST U.S. WHETHER IN COURT OR IN ARBITRATION
BROAD RIGHTS TO DISCOVERY AS ARE AVAILABLE IN A LAWSUIT
RIGHT TO APPEAL THE DECISION OF AN ARBITRATOR
OTHER RIGHTS THAT ARE AVAILABLE IN A LAWSUIT
Rights You and We Do Not Give UP: If a Claim is arbitrated, you and we will continue to have the following rights, without waiving this arbitration agreement as to any Claim: 1) Right to file bankruptcy in court; 2) Right to enforce the security interest in the vehicle, whether by repossession or through a court of law; 3) Right to take legal action to enforce the arbitrator's decision; and 4) Right to request that a court of law review whether the arbitrator exceeded its authority.
You may choose the organization to conduct the arbitration subject to our approval. The applicable rules (the "Rules") may be obtained from the selected organization. If there is a conflict between the Rules and this contract, this contract shall govern. This contract is subject to the Federal Arbitration Act (9 U.S.C. §1 et seq.) and the Federal Rules of Evidence. The arbitration decision shall be in writing with a supporting opinion. We will pay your total reasonable arbitration fees and expenses (not including attorney fees, except where applicable law otherwise provides) in excess of $125. We will pay the whole filing fee if we demand arbitration first. Any portion of this arbitration clause that is unenforceable shall be severed, and the remaining agreements shall be enforced.
Id ., (italic emphasis added; bold in original).
Furthermore, this prominent disclaimer appears on the first page of the Sales Contract above the signature line: "YOU ACKNOWLEDGE THAT YOU HAVE READ AND AGREE TO BE BOUND BY THE ARBITRATION PROVISION ON THE REVERSE SIDE OF THIS CONTRACT." Id . (bold uppercase in original).
According to FMCC's records, and the civil complaint filed in the Court of Common Pleas, Plaintiff's account went into default in October of 2012, and FMCC retained Sklar-Markind. See Civil Complaint, Court of Common Pleas of Allegheny County, Exhibit B to Motion to Compel (ECF No. 14-2), ¶¶ 6-8. Plaintiff's Complaint alleges that the Defendants were the attorneys for FMCC with respect to the underlying state court collection case. Specifically, Plaintiff states: "Brown is informed and believes, and on that basis alleges, that the creditor of the Brown Obligation either directly or through intermediate transactions assigned, placed, or transferred the Brown Obligation to Sklar-Markind for collection ." Complaint (ECF No. 1) at ¶ 21 (emphasis added).
Plaintiff acknowledges that the motion to compel is "based on an arbitration clause in a retail sales installment sales agreement... between the Plaintiff and the client of the Defendants" and he does not dispute that he knowingly executed the Sales Contract containing the arbitration provision. Plaintiff's Brief in Opposition (ECF No. 19) at 1. In his response in opposition to the motion to compel, Plaintiff also admits: that he purchased the Ford Fiesta on February 5, 2011; that he entered into the Sales Contract with Woltz & Wind attached to the motion to compel as Exhibit B; that he defaulted on the contract in October, 2012; and that Woltz & Wind assigned the Sales Contract to FMCC. Plaintiff's Response in Opposition to Defendants' Motion to Compel Arbitration and Stay Proceedings (ECF No. 18), at ¶¶ 1-3.
Thus, Plaintiff does not dispute the factual predicates underlying the motion to compel arbitration, but instead raises the following legal challenges to ...