Arbitration Agreement Cases of Interest >  Cyberlaw

Burgess v. Qwest, Corp.

Burgess v. Qwest Corp., -F.Supp.2d-, WL 1897696 (D. Or. 2008)
Decided April 28, 2008

FACTS: Plaintiff and defendant entered into an agreement for defendant to provide plaintiff with telephone, cellular, and internet services. Shortly thereafter plaintiff cancelled the internet service and defendant agreed to credit her initial charges. However, defendant repeatedly billed plaintiff for the services, sent her past due notices, and threatened to disconnect her telephone services. Plaintiff also experience telephone service disruption and eventually cancelled that service. Again, the defendant continued to bill her and sought to collect an outstanding balance of $ 154.62. Plaintiff hired an attorney and told defendant to stop attempting to collect the money. The defendant refused. Then, plaintiff sued defendant for damages and injunctive relief for alleged violations of the federal Common Carrier Regulation (47 U.S.C. § 201) and the Oregon Unlawful Debt Collection Practices Act. The defendant moved to compel arbitration and stay proceedings based on an arbitration agreement between the parties and the Federal Arbitration Act.
ISSUE: Whether a valid arbitration existed between the parties to compel arbitration between the parties.
HOLDING: The Court denied the defendant’s motion to compel arbitration. The Court held that the defendant failed to show by preponderance of the evidence that parties agreed to arbitrate, and thus as a matter of law, there was no arbitration agreement between the parties.
REASONING: The Court used a two step process to decide the defendant’s motion to compel arbitration. First, is to determine whether a valid agreement to arbitrate exists between the parties. Second, is whether the claims or issues raised by the plaintiff here are within the scope of such an agreement. The Court held that as to both the Internet and Wireless Agreements the defendant failed to establish an “objectively manifested meeting of the minds” regarding any arbitration agreement. The defendant tried to argue, based on the introductory paragraph of the Internet agreement, that the plaintiff had agreed to the arbitration agreement when she failed to return the modem equipment within 30 days of cancellation and/or by enrolling in the Internet service (as per the intro paragraph). The Court rejected this argument by stating that the defendant offered no evidence that the plaintiff was made aware of the introductory paragraph or the arbitration clause contained within the agreement. Furthermore, the Internet agreement had an exception that either party may pursue claims in court if relate to solely to collection of any debts owed to Qwest; which is exactly what was at issue in this case.
Regarding the Wireless Agreement, the defendant attempted to argue that it was standard business practice to have an arbitration agreement. The defendant also stated that the wireless agreement was made over the phone, but that before enrolling customers are made aware of all the terms of the agreement before agreeing, and then receive a paper copy of said terms after receiving their equipment. The plaintiff countered this argument by stating that it would have been impossible for her to have been made aware of all the terms in the agreement over the phone, because they comprised 8 single-spaced pages. The Court again stated that the defendant failed to offer any evidence specific to the call between the plaintiff and the defendant to show a “meeting of the minds.” Thus, regarding the wireless agreement, the Court held that the defendant did not establish by preponderance of the evidence that the parties agreed to arbitrate

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