Week Nineteen

Week of May 8, 2017 through May 12, 2017

Michael Dreher v. Experian Information Solutions (Thacker 5/11/2017): The Fourth Circuit held that a defendant credit score provider’s practice of listing a defunct credit card company rather than the name of its servicer as a source of information on an individual’s credit report is not a concrete injury to the named plaintiff for the purpose of standing. The court vacated the district court’s judgment and remanded the case with instructions to dismiss.  Full Opinion

Ronald Barton v. Constellium Rolled Products (Motz 5/11/2017): The Fourth Circuit held that collective bargaining agreements must be interpreted with ordinary contract principles and, consequently, retiree health benefits have not vested when the plain language of a contract clearly indicates that the benefits do not vest. The court affirmed the district court’s grant of summary judgment to the defendant employer. Full Opinion

James Dillon v. BMO Harris Bank, N.A. (Keenan 5/10/2017): The Fourth Circuit held that an arbitration agreement in a “payday loan” contract based on Indian tribal law functioned as a prospective waiver of federal rights to pursue statutory remedies and, therefore, the arbitration agreement was unenforceable as a matter of law. The court affirmed the district court’s order denying the defendant’s renewed motion to compel arbitration. Full Opinion

Martha Carlson v. Boston Scientific Corporation (Thacker 5/9/2017): The Fourth Circuit held that a plaintiff who claims injury from a surgically implanted device by the doctor’s failure to warn does not meet its burden of proof when it does not cite any evidence that any allegedly inadequate warnings caused the injuries. The Fourth Circuit also held that when a motion for reconsideration is merely a vessel for introducing the very evidence that was initially lacking, the evidence may not be considered. The court affirmed the decision of the district court, granting partial summary judgment and denying the motion for reconsideration. Full Opinion

US v. Damien Riley (Wilkinson 5/9/2017): The Fourth Circuit held that Maryland simple robbery was a “crime of violence” for the purpose of career offender status under the residual clause of the U.S. Sentencing Guidelines’ career offender guideline. The court affirmed the district court’s designation of the defendant as a career offender. Full Opinion

 

Highlight Case

James Dillon v. BMO Harris Bank, N.A., No. 16-1362

Decided: May 10, 2017

The Fourth Circuit held that an arbitration agreement in a “payday loan” contract based on Indian tribal law functioned as a prospective waiver of federal rights to pursue statutory remedies and, therefore, the arbitration agreement was unenforceable as a matter of law. The court affirmed the district court’s order, denying the defendant’s renewed motion to compel arbitration.

In December 2012, Plaintiff James Dillon (“Plaintiff”) applied for and received a “payday loan” through the website of Great Plains Lending, LLC (“Great Plains”). Great Plains charged an interest rate of 440.18%, which far exceeded the maximum interest rate of 16% under North Carolina usury law. In order to complete the transaction, Plaintiff electronically signed a contract that contained the terms of the loan, including an arbitration agreement. The agreement further included choice of law provisions that disclaimed the application of state or federal law and instead used the law of the Otoe-Missouria Tribe of Indians. Plaintiff sued the financial institutions that facilitated these payday lending transactions over the ACH network, including BMO Harris (“Defendant”), claiming they conducted and participated in the collection of unlawful debts in violation of the federal RICO Act. Defendant sought to compel arbitration pursuant to the agreement. The district court denied Defendant’s motion to compel arbitration. Defendant appealed the denial of that order.

The Fourth Circuit held that the arbitration agreements were unenforceable because they operated as a prospective waiver of a party’s right to pursue statutory remedies. The court reasoned that the choice of law provisions in the agreement were indistinguishable from related provisions in a similar case that the court held unenforceable. The arbitration agreement did not allow for the application of any law other than tribal law, and it disavowed the application of federal or state law. Therefore, the court concluded that the arbitration agreement functioned as a prospective waiver of federal statutory rights and, thus, was unenforceable as a matter of law.

Accordingly, the Fourth Circuit affirmed the district court’s order, denying Defendant’s renewed motion to compel arbitration.

Full Opinion

Jacob D. Taylor

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