Professional Documents
Culture Documents
No. 14-2160
Appeal from the United States District Court for the District of
Maryland, at Baltimore.
J. Frederick Motz, Senior District
Judge. (1:14-cv-02375-JFM)
Argued:
Decided:
July 6, 2015
this
in
appeal,
denying
arbitration award.
various
credit
we
consider
motion
to
whether
vacate
the
district
certain
aspects
court
of
an
services
provided
to
plaintiff
et
seq.,
were
not
met.
The
arbitrator
awarded
the
The
arbitrator
also
determined
that
the
amounts
of
the
scope
of
his
authority
under
the
Federal
the
challenged
portions
of
the
arbitration
award.
I.
Between
1998
and
2003,
plaintiffs
Laverne
Jones,
Stacey
programs
with
credit
3
counseling
agency,
Genus
other
things,
the
plaintiffs
authorized
Genus
to
seek
Although
Genus
represented
itself
as
non-profit
accepted
(voluntary
voluntary
contributions)
as
contributions
well
as
from
the
voluntary
plaintiffs
contributions
Genus
2004,
the
plaintiffs
jointly
filed
class
action
the
Court
original
for
the
defendants)
District
of
in
the
United
Maryland,
States
alleging
The
district
the
court
arbitration
dismissed
provisions
in
the
the
action,
plaintiffs
holding
that
contracts
required
Credit Mgmt. Corp., 353 F. Supp. 2d 598, 602-03 (D. Md. 2005).
The court later supplemented its decision, directing that an
arbitrator
first
should
decide
whether
any
arbitration
would
individual
and
class
claims
against
the
original
By the time
class
of
consumers
arbitrators
class
only
with
regard
to
the
certification,
and
we
affirmed
the
v. Jones, 457 F. Appx 287, 290 (4th Cir. Dec. 9, 2011); see
Genus Credit Mgmt. Corp. v. Jones, No. 1:05-cv-03028-JFM (D. Md.
Apr. 6, 2006).
The defendants did not appeal the district
courts dismissal of this civil action.
See Amerix, 457 F.
Appx at 290.
2
approved
the
defendants
and
plaintiffs
awarded
settlements
more
than
with
$2.6
The
these
million
in
exemplary.
Following
the
settlements,
the
defendants
arbitration
award
granting
the
plaintiffs
only
partial
RICO and MCPA claims as well as the plaintiffs other state law
claims,
including
the
alleged
MDMSA
violations,
breaches
of
respect
to
subset
of
the
plaintiffs
class
and
In
that although the plaintiffs had not proved that the defendants
violated the Act by making untrue or misleading statements 4 or by
unlawfully billing consumers for debt management services, 5 the
evidence nonetheless showed that the defendants had failed to
make certain disclosures to consumers mandated under the Act.
Those
disclosure
provisions
required
that
the
defendants
organizations
summarizing
their
right
provide
to
consumers
accurate
with
information
a
in
document
certain
regulatory ambit. The arbitrator did not make any such finding
regarding defendant Ascend One Corporation (Ascend One), given
the arbitrators earlier conclusion that Ascend One was not a
successor to Amerix for liability purposes. Although we observe
that this finding was not challenged on appeal, we continue to
refer to the defendants in the collective sense for the purposes
of this opinion.
4
conditions
services
to
of
be
payment,
performed,
detailed
information
description
identifying
of
the
the
credit
repair
organizations
to
supply
consumers
with
the
either
defendants
met
reasonably
concluded
some
close
that
defendants
consumers
did
of
to
make
the
[a]lmost
so,
is
not
denied
information
number
[statutory]
doing
violations
the
and
of
disclosures
requirements
the
arbitrator
good
enough,
hundreds
options
of
that
or
that
came
nevertheless
and
that
the
thousands
of
should
have
been
plaintiffs
for
the
defendants
statutory
violations,
the
the
damages
voluntary
under
CROAs
1679g(a)(1)(B).
any
amount
organization.
contributions
paid
actual
of
certain
damages
class
provision,
members
15
as
U.S.C.
the
person
to
15 U.S.C. 1679g(a)(1)(B).
the
credit
repair
for
defined
credit
repair
service.
The
arbitrator
arbitrator
contributions
1679g(a)(1)(B),
class
members
exchange
for
concluded
were
did
that
not
primarily
not
credit
amount[s]
plaintiffs
because
make
any
repair
paid
under
significant
Section
percentage
of
contributions
in
voluntary
services.
voluntary
Accordingly,
the
arbitrator
damages
recover
for
concluded,
certain
provision,
15
however,
violations
U.S.C.
that
under
1679g(a)(2).
the
CROAs
plaintiffs
punitive
Noting
that
10
and
severally
against
explained
that
in
his
powerful
deterrent,
Amerix
and
view,
this
was
well
Dancel. 6
amount
The
would
within
arbitrator
serve
the
as
financial
capabilities of Amerix and Dancel, and would not put [them] out
of business []or into bankruptcy.
Finally, the arbitrator considered the plaintiffs request
for several million dollars in attorneys fees and costs.
request
was
in
addition
to
the
fees
of
about
$2.6
This
million
that
shall
under
CROA,
defendants
plaintiffs
for
the
reasonable
attorneys
costs
fees,
of
15
be
the
liable
action,
U.S.C.
to
successful
together
1679g(a)(3),
with
the
arbitrator found that the additional fee and cost requests were
unreasonable.
The arbitrator
lodestar
billing
rates,
and
had
submitted
time
and
Treating
plaintiffs
the
attorneys
counsel
from
the
fees
prior
already
received
settlements
as
by
set-offs
payable
exceeded
by
received.
for
the
the
greater
Accordingly,
items
that
amounts
the
were
the
substantiated
attorneys
arbitrator
were
already
declined
to
had
award
plaintiffs
filed
the
present
civil
action
in
the
applicable
thoughtful
and
to
arbitration
well-considered
awards,
nature
as
of
the
well
as
the
arbitrators
decision.
Accordingly,
the
court
granted
the
award.
The
plaintiffs
timely
appealed
the
district
II.
The
plaintiffs
argue
that
the
district
court
committed
or
(2)
basis
for
additional
attorneys
fees
and
Section
10(a)(4)
of
the
FAA.
We
review
de
novo
the
Wachovia Sec., LLC v. Brand, 671 F.3d 472, 478 (4th Cir.
2012).
A.
We first examine the standard of review that applies to a
district
courts
review
of
an
arbitration
award.
In
ordinarily
inappropriate
the
here
resolution
of
is
very
because
limited,
the
statutory
such
arbitrators
claims.
We
narrow
focus
decision
disagree
is
involved
with
the
plaintiffs contention.
The FAA provides four grounds on which an arbitration award
may be vacated.
evident
partiality
or
corruption
on
the
part
of
an
9 U.S.C. 10.
Id. at 582.
483.
As
general
matter,
however,
judicial
review
of
an
188,
193
(4th
Cir.
1998).
Such
limited
review
is
strongly,
applicable law.
that
the
arbitrators
misinterpreted
the
omitted).
The plaintiffs argue, nevertheless, that these principles
do not govern the present case because the arbitrator considered
remedies created by statute, rather than rights established by
contract.
two
Supreme
Court
decisions
addressing
the
arbitration
of
the
first
Interstate/Johnson
plaintiffs
focus
of
Lane
solely
these
decisions,
Corp.,
500
on
Courts
the
U.S.
20
Gilmer
v.
(1991),
the
statement
that
by
their
forum.
marks
resolution
in
an
arbitral,
rather
than
judicial,
Contrary
to
the
plaintiffs
contention,
however, this statement does not alter the standard for judicial
review of an arbitration award involving statutory remedies, but
simply
emphasizes
that
such
remedies
are
available
in
Thus, in
Gilmer, the Court held that a claim under the Age Discrimination
in
Employment
Act
(ADEA)
was
subject
15
to
the
parties
prior
agreement
to
arbitrate
disputes
arising
out
of
workers
Id. at 26-33.
arbitration
CompuCredit,
the
decisions
Court
involving
upheld
an
statutory
agreement
claims.
In
compelling
the
Id. at 669-73.
here
do
not
dispute
the
enforceability
of
the
explained
applies
to
that
although
arbitrators
decisions
narrow
standard
regarding
of
statutory
review
claims,
Id. at 32 n.4
Accordingly,
we
proceed
to
consider
the
merits
of
their
appeal
The
plaintiffs
argue
that
the
district
court
erred
by
plaintiff
has
shown
that:
(1)
the
disputed
legal
and
principle.
(2)
the
arbitrator
Id. at 483.
refused
to
apply
that
legal
that
of
the
showing
plaintiffs
that
have
the
failed
arbitrator
to
satisfy
manifestly
particular,
the
plaintiffs
argue
that
the
arbitrator
that
15
U.S.C.
Section
1679g(a)(1)(B).
1679g(a)(1)(B)
clearly
The
plaintiffs
includes
certain
We disagree.
to
receive
fair
share
payments
as
actual
damages. 9
contributions
did
not
constitute
amount[s]
paid
15 U.S.C. 1679a(3).
in
return
for
the
defendants
services,
did
not
actual
irrespective
damages
whether
provision
the
covered
payments
were
all
amounts
required
for
paid,
the
10
20
According to
under
[the
actual
damages
or
punitive
damages
11
attorneys fees.
15 U.S.C. 1679g(a)(3).
We disagree with
burden
of
reasonable.
demonstrating
that
the
requested
fees
are
We similarly have
See
the
present
case,
the
arbitrator
found
that
the
The
with
use
arbitrator
the
of
identified
plaintiffs
block
fee
billing
several
request,
practices,
serious
including
quotation
of
arbitrator
improper
also
requests
noted
for
that
plaintiffs
questionable
counsel
litigation
submitted
expenses,
view
arbitrator
principles.
of
did
these
not
circumstances,
refuse
Instead,
the
to
heed
any
arbitrator
22
we
conclude
clearly
correctly
that
defined
observed
the
legal
that
Council,
999
F.2d
at
97
(forbidding
See Fair
plaintiffs
from
effectively
disallowed
what
unreasonable
attorneys
fees
costs,
reducing
the
requested
and
amounts
and
by
he
concluded
by
were
significantly
setting
off
the
the
applicable
supported
Sec.,
671
by
his
F.3d
legal
principles
interpretation
at
478
n.5.
of
and
our
reached
precedent.
Accordingly,
12
we
decision
Wachovia
reject
the
plaintiffs
various
arguments
regarding
their
request
for
the
plaintiffs
advance
an
alternative
argument
its
terms,
Section
10(a)(4)
allows
courts
to
vacate
so
imperfectly
executed
them
that
mutual,
final,
and
definite award upon the subject matter submitted was not made.
9 U.S.C. 10(a)(4).
an
award
economic
justice.
that
simply
Id.
at
reflects
2068
his
(citations,
own
notions
brackets,
of
and
the
plaintiffs
do
not
argue
that
the
arbitrator
rejected,
namely,
that
the
24
arbitrator
misinterpreted
various
legal
discussed,
the
principles.
plaintiffs
Moreover,
have
as
we
misrepresented
already
the
have
record
by
as
justice.
11.
reflecting
the
arbitrators
notions
of
economic
III.
For these reasons, we affirm the district courts judgment.
AFFIRMED
13