Anderson v. Amazon.com, Inc.

• Decision Date: 29 September 2020
• Docket Number: NO. 3:19-cv-01151,3:19-cv-01151
• Citation: 490 F.Supp.3d 1265
• Parties: Keith ANDERSON, Matthew Cooper, and Sabrina Warner, on behalf of themselves and all others similarly situated, Plaintiffs, v. AMAZON.COM, INC., Walmart, Inc., Wal-Mart.com USA, LLC, and eBay, Inc., et al., Defendants.
• Court: U.S. District Court — Middle District of Tennessee

490 F.Supp.3d 1265

Keith ANDERSON, Matthew Cooper, and Sabrina Warner, on behalf of themselves and all others similarly situated, Plaintiffs,

v.AMAZON.COM, INC., Walmart, Inc., Wal-Mart.com USA, LLC, and eBay, Inc., et al., Defendants.

NO. 3:19-cv-01151

United States District Court, M.D. Tennessee, Nashville Division.

Filed September 29, 2020

Dan C. Stanley, Stanley & Kurtz, PLLC, Richard Everett Collins, II, R.E. Collins Firm, Knoxville, TN, for Plaintiffs.

Lela M. Hollabaugh, Bradley Arant Boult Cummings LLP, Nashville, TN, Scott B. Smith, Bradley Arant Boult Cummings LLP, Huntsville, AL, for Defendant Amazon.com, Inc.

Austin K. Purvis, Samuel Lanier Felker, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Nashville, TN, for Defendants Walmart Inc., Wal-Mart.com USA, LLC.

Lauren Paxton Roberts, Stites & Harbison, PLLC, Nashville, TN, for Defendant eBay, Inc.

MEMORANDUM OPINION AND ORDER

ELI RICHARDSON, UNITED STATES DISTRICT JUDGE

Pending before the Court is Defendants Walmart, Inc. and Wal-Mart.com USA, LLC (collectively "Walmart")’s¹ Motion to Compel Arbitration and to Dismiss (Doc. No. 33, "Motion") as to Plaintiff Keith Anderson ("Plaintiff Anderson"), supported by an accompanying Memorandum of Law (Doc. No. 34). Plaintiff Anderson filed a response (Doc. No. 42), and Defendant replied (Doc. No. 43). For the reasons stated herein, Defendant Walmart's Motion is GRANTED .

BACKGROUND²

On December 6, 2019, Plaintiff Anderson purchased two "Universal Auto Car Seat Belt Extenders 9 inch" as a guest customer from the Walmart website. (Doc. No. 35 at 2). To purchase an item through the Walmart website, a customer must complete a checkout process. (Doc. No. 36 at 1). During the first step of this checkout process, a customer views a list of items in their shopping cart and an estimated total. (Id. ). In order to proceed, the customer must then click a blue "Check Out" button.

(Id. ). After clicking this button, a guest customer (a customer without a Walmart website account) will select delivery and other options before clicking a "Review Your Order" button. (Id. at 2). As revealed in the image below, the next page contains information about the order and the following language: "By clicking Place Order, you agree to Walmart's Updated Privacy Policy and Terms of Use." (Id. ). The words "Privacy Policy" and "Terms of Use" are hyperlinks which will take a customer to Walmart's Privacy Policy and Terms of Use. (Id. ). Both phrases are bolded and underlined. (Id. ). To complete the order, a customer must click on a blue "Place Order" button. (Id. at 3). The order cannot be completed without clicking this button. (Id. ).

(Id. at 2).

At the top of the first page of Walmart's Terms of Use are the words: "Please review these Terms of use carefully. They include a binding arbitration clause (see Section 20) requiring you and us to arbitrate our claims instead of suing in court." (Doc. 35-2 at 2). Further down on the same page, in bold and all capitals, the Terms of Use state: "IMPORTANT: THIS AGREEMENT CONTAINS A MANDATORY ARBITRATION PROVISION THAT, AS FURTHER SET FORTH IN SECTION 20 BELOW, REQUIRES THE USE OF ARBITRATION ON AN INDIVIDUAL BASIS TO RESOLVE DISPUTES. THIS MEANS THAT YOU AND WALMART ARE EACH GIVING UP OUR RIGHTS TO SUE EACH OTHER IN COURT OR IN CLASS ACTIONS OF ANY KIND. " (Id. )

Section 20 of the Terms of Use ("Arbitration Clause") states, in part:

PLEASE READ THIS SECTION CAREFULLY, IT MAY SIGNIFICANTLY AFFECT YOUR LEGAL RIGHTS, INCLUDING YOUR RIGHT TO FILE A LAWSUIT IN COURT. Using or accessing the Walmart Sites constitutes your acceptance of this Arbitration provision. Please read it carefully as it provides that you and Walmart will waive any right to file a lawsuit in court or participate in a class action for matters within the terms of the Arbitration provision.

EXCEPT FOR DISPUTES THAT QUALIFY FOR SMALL CLAIMS COURT, ALL DISPUTES ARISING OUT OF OR RELATED TO THESE TERMS OF USE OR ANY ASPECT OF THE RELATIONSHIP BETWEEN YOU AND WALMART, WHETHER BASED IN CONTRACT, TORT, STATUTE, FRAUD, MISREPRESENTATION, OR ANY OTHER LEGAL THEORY, WILL BE RESOLVED THROUGH FINAL AND BINDING ARBITRATION BEFORE A NEUTRAL ARBITRATOR INSTEAD OF IN A COURT BY A JUDGE OR JURY. AND YOU AGREE THAT WALMART AND YOU ARE EACH WAIVING THE RIGHT TO SUE IN COURT AND TO HAVE A TRIAL BY A JURY. YOU AGREE THAT ANY ARBITRATION WILL TAKE PLACE ON AN INDIVIDUAL BASIS; CLASS ARBITRATIONS AND CLASS ACTIONS ARE NOT PERMITTED AND YOU ARE AGREEING TO GIVE UP THE ABILITY TO PARTICIPATE IN A CLASS ACTION.

(Id. at 15-16).

On December 21, 2019, Plaintiff Anderson, together with Plaintiffs Matthew Cooper and Sabrina Warner (collectively "Plaintiffs"), filed the Complaint in this case on behalf of themselves and all others similarly situated, alleging fraud and negligent misrepresentation regarding the sale of seatbelt extenders. (Doc. No. 1 at ¶ 1). In their Complaint, Plaintiffs allege that Defendants Amazon.com, Inc., Walmart, Inc., Wal-Mart.com USA, LLC, and eBay, Inc. (collectively "Defendants") fraudulently misled consumers regarding the proper usage and safety ratings of seatbelt extenders. (Id. at ¶¶ 12-36). Specifically, Plaintiffs allege that Walmart advertised a seatbelt extender as safe for use with children's car seats despite numerous car manufacturers’ warnings against such use. (Id. at ¶ 28-29, 30-31). Plaintiffs allege that the sole intended use of seatbelt extenders is for those individuals whose weight falls above the 99th percentile and cannot buckle a standard seatbelt. (Id. at ¶ 15). Plaintiff Anderson purchased a seat belt extender for use with his child's booster seat. (Id. at ¶¶ 5, 6, 29, 30-31). Plaintiff Anderson, a plus-sized individual who does not fall above the 99th percentile, also purchased a seatbelt extender for his own use. (Id. at ¶ 30). Plaintiff Anderson is the sole Plaintiff to make allegations against Walmart. (Id. ).

The Court previously entered an Order (Doc. No. 51) granting Defendant eBay's Motion to Compel Arbitration and Stay Proceedings as to Plaintiff Matthew Cooper. The Court has also entered an Order (Doc. No. 52) granting Defendant Amazon's Motion to Compel Arbitration and to Dismiss as to Plaintiff Sabrina Warner. Pending before the Court in this instance is Defendant Walmart's Motion to Compel Arbitration and to Dismiss as to Plaintiff Anderson. (Doc. No. 33).

LEGAL STANDARD

The Federal Arbitration Act ("FAA") provides that a written provision in a contract "to settle by arbitration a controversy thereafter arising out of such contract ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2. This section of the FAA "embodies the national policy favoring arbitration and places arbitration agreements on equal footing with all other contracts." Seawright v. Am. Gen. Fin. Servs., Inc. , 507 F.3d 967, 972 (6th Cir. 2007) (internal citation and quotation omitted).

Under the FAA, if a party establishes the existence of a valid agreement to arbitrate, the district court must grant the party's motion to compel arbitration and stay or dismiss proceedings until the completion of arbitration. Glazer v. Lehman Bros., Inc. , 394 F.3d 444, 451 (6th Cir. 2005) (citing 9 U.S.C. §§ 3 - 4 ). Furthermore, "courts are to examine the language of the contract in light of the strong federal policy in favor of arbitration." Stout v. J.D. Byrider , 228 F.3d 709, 714 (6th Cir. 2000) (citation omitted). Therefore, any doubts regarding arbitrability must be resolved in favor of arbitration. Fazio v. Lehman Bros., Inc. , 340 F.3d 386, 392 (6th Cir. 2003). However, while the courts must respect "the liberal federal policy favoring arbitration agreements ... arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed to submit." Seawright , 507 F.3d at 972 (internal citation and quotation omitted). Because arbitration agreements are fundamentally contracts, the enforceability of a purported agreement to arbitrate is evaluated according to applicable state contract law. Id.

When considering a motion to dismiss and compel arbitration under the FAA, a court has four tasks:

[F]irst, it must determine whether the parties agreed to arbitrate; second, it must determine the scope of that agreement; third, if federal statutory claims are asserted, it must consider whether Congress intended those claims to be nonarbitrable; and fourth, if the court concludes that some, but not all, of the claims in the action are subject to arbitration, it must determine whether to stay the remainder of the proceedings pending arbitration.

Stout , 228 F.3d at 714 (citing Compuserve, Inc. v. Vigny Int'l Finance, Ltd. , 760 F. Supp. 1273, 1278 (S.D. Ohio 1990) ). Since Plaintiff Anderson alleges that the agreement is unconscionable, the only task before this Court is whether the parties agreed to arbitrate.

As noted above in a footnote, "in evaluating motions to compel arbitration, ‘courts treat the facts as they would in ruling on a summary judgment.’ " Yaroma , 130 F. Supp. 3d at 1062 (quoting Kovac , 930 F. Supp. 2d at 864 ). "Therefore, the party opposing arbitration bears the burden of ‘showing a genuine issue of material fact as to the validity of the agreement to arbitrate.’ " Id. (citing Great Earth Cos. v. Simons , 288 F.3d 878, 889 (6th Cir. 2002) ). Thus, the court views "all facts and inferences drawn therefrom in the light most favorable" to the party opposing arbitration and "determine[s] whether the evidence presented is such that a reasonable finder of fact could conclude that no valid agreement to arbitrate exists." Id. ; see also Green Tree Fin. Corp.-Ala. v. Randolph , 531 U.S. 79, 91, 121 S.Ct. 513, 148 L.Ed.2d 373 (2000) (stating that the party challenging arbitration has the burden of proving that the claims at issue are not arbitrable).

DISCUSSION

Defendant Walmart asserts that the...