One to Watch: Should an Arbitrator Decide Enforceability?
The U.S. Supreme Court yesterday heard oral argument in Jackson v. Rent-A-Center West, Inc., which poses the question whether the enforceability of an arbitration agreement should be decided by an arbitrator or by a court.
In Jackson, plaintiff Antonio Jackson, a former employee of defendant Rent-A-Center West, sued alleging race discrimination and retaliation. Rent-A-Center moved to dismiss and to compel arbitration, based on the parties' arbitration agreement which provided, among other things, that the arbitrator had exclusive authority to decide any issue related to the "interpretation, applicability, enforceability or formation" of the arbitration agreement. Jackson asserted that the arbitration agreement was unconscionable and therefore unenforceable. The district court granted defendant's motion to dismiss and entered an order compelling arbitration, holding that the issue of enforceability of the arbitration agreement was for the arbitrator to decide. The district court also issued an alternative holding that Jackson had not shown the agreement was substantively unconscionable. Jackson appealed.
Continue Reading...Mistake of Law No Defense to FDCPA
The U.S. Supreme Court yesterday issued its opinion in Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, holding that a mistake of law cannot be the basis of a bona fide error defense to the Fair Debt Collection Practices Act.
In Jerman, plaintiff filed suit against a collection law firm alleging violations of the FDCPA, among other things, based on assertions to plaintiff by the law firm that her debts would be assumed valid unless she disputed the debt in writing, which is not required by the FDCPA. The district court granted summary judgment for defendant, holding that defendant's mistake of law was a bona fide error under the FDCPA, shielding them from liability. Plaintiff appealed. The Sixth Circuit affirmed, holding that mistakes of law, in addition to clerical errors, can be the basis of a bona fide error defense under the FDCPA.
The Supreme Court reversed and remanded, resolving a split in the circuits on this issue, holding that "A violation resulting from a debt collector’s misinterpretation of the legal requirements of the FDCPA cannot be “not intentional” under §1692k(c)" and thus cannot be the basis of a bona fide error defense.
One to Watch: U.S. Supreme Court Considers FDCPA Defense
The U.S. Supreme Court has granted certiorari in Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 538 F.3d 469 (6th Cir. 2008), to consider whether a mistake of law can be the basis of a bona fide error defense under the Fair Debt Collection Practices Act.
In Jerman, plaintiff filed suit against a collection law firm alleging violations of the FDCPA, among other things, based on assertions to plaintiff by the law firm that her debts would be assumed valid unless she disputed the debt in writing, which is not required by the FDCPA. The district court granted summary judgment for defendant, holding that defendant's mistake of law was a bona fide error under the FDCPA, shielding them from liability. Plaintiff appealed. The Sixth Circuit affirmed, holding that mistakes of law, in addition to clerical errors, can be the basis of a bona fide error defense under the FDCPA.
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