our final case for this morning is a d against credit one bank mr and cor good morning with a young woman was deprived of her day in court because she helped her mother buy a ten dollars juice smoothie when she was fourteen years old her mother went to a local mall in february of tw one of our original perspective in illinois resident but i did not make the case so ok just wondered yeah yeah so i would like you to focus on the language in the credit card authorized user proficiency which is actually a fairly long paragraph i take it your point is that ady was not an authorized  user just because she was holding the card because there are all these other things in the paragraph that need to be satisfied by designating an authorized user who is at least fifteen years of age you understand all these things one through six and you have to pay an authorized user fee for issuing a card in that person's name so the bank argues that really literally you know i could give my six year old granddaughter my credit card and she would become an authorized user on the account and waive her right to a jury trial it's utter etc right and you know we're not parents article but also bound by their choice of nevada law  but it to govern the terms of that contract the defined what that authorized term meant authorize use or means the following requires the following circumstances the key of which is you have to be at least fifteen for here because it's a pretty bright rule also the supreme court in two thousand and nine to judge kane's point in arthur andersen against carlisle saying neither provision of the f a a reports alter background principles of state contract law regard scope of agreements including the question of who is bound by them which i read as is indicating that this is an issue of state law i think that's true as well and it may not matter me i'm not sure whether but i think you is probably an issue of federal common law in the arbitration cases seem to create and recognize that there is such a thing as federal common law in these kinds of areas because you can't really get into state law do you will let you have a contract there in the first place so some of the things with respect to for example in country building with respect to contract formation depends upon state law but after that with equitable doctrines particularly those seem to be at least  uniform in looking to federal sources of fact to flee federal law i think this has gotten very confused because the supreme court has made it clear that there's only so much room for state law to operate without conflicting with the policy behind the federal arbitration act and so it's been founded preempt a number of state laws you can't have a contract affecting interstate commerce that says there will be no arbitration in this you can't state law that says there will be no arbitration of same plane and contacts when the f a a has said no sorry employment contracts aren't forcible that doesn't go to the question whether an employment contract is formed who is a party to that contract who third party beneficial whatever other contract issues there are but i think the courts have been somewhat confused about where preemption is kicking in and where it's really just plain old question state law but i don't i wonder why does it matter here mean you i thought you'd argued that whether it was california areas that are federal common law it all boil down same thing anyway it did of the day that's that's pretty pretty typical of the a stop o is the same there's not a whole lot and benefits of stumble but nobody seems to agree when there seems to be some consensus as to what a direct benefit is vs an indirect benefit everyone agrees indirect not good enough direct good enough but then that gray area of what sort of fact patterns fit into which go through which door that's all over the place and i don't think it's amenable to strictly saying whether it's state law or federal law we have to get down into the weeds and figure out whether these sorts of benefits are in fact direct and ultimately at the end of the day because it's an equitable doctrine we ask ourselves is this fair and how it would strongly suggest that it is just not fair you know helping her mother by one jew smoothie overprices it may be a ten go finish this purchase for me and that's pretty important because the mother starts the purchase the analogy i use down at the district court was like going to a restaurant ordering the meal you make the decisions about what you want to eat but then you give typically if it's a sit down restaurant you give your card to the server the server runs and actually does the physical point of sale and that's a that's a distinction i think that's meaningful here because the mother starts the financial transaction and the daughter is doing nothing more than transporting it to the store whether her mother is present in the store or their mothers parking the car i don't think that fact should turn on whether she's bound by the contract or not years later you know if it's that distinction helping carry out a transaction instead of for example taking you know him on can i borrow a card and lending it to her and then she goes to the rest of the mall and does whatever damage teenage girls do to credit cards and comes back with a whole host of purchases their mother has no idea about that circumstance that scenario whether she actually is a user small you know commonly understand someone who uses the card that's not good and that's not this this number one that's not that fact not this fact but i think we that would probably be much more close to the idea of attaining a direct benefit contract here it was her mother's decision to to use for example credit versus cash the mother said that were select among the credit options under arthur anderson you need to apply state law and the state law that the parties have briefed here is nevada and nevada makes clear what it requires for application of direct benefits and also california the reason i point that out and i know this hasn't really been raised on appeal but it's very troublesome to me you did not make an arbitration demand until very late in the day and i understand that your reason for that was he said oh you know we didn't even know this might be arbiter bowl until the depositions were taken but i find that very hard to believe because you've got your the bank you've got judith serrano clearly the adult in the question it seems to me from the day this complaint was filed you knew that there was an arbitration possibility well credit one raised arbitration as an affirmative defense when it answered the question about whether to assert arbitration only arose because there was a question as to whether it be left  and you know we have cases that say this right this entire right to have something arbitrated can be waived that survived on the understanding and forcing people to spend resources for two years in a court and then coming on saying up you know we've decided to arbitrate is very wasteful that's certainly right around her but the district court address this very issue and determined that credit one had preserved its ability but i understand the district court said that i'm not sure i agree with what the district court said but i do know that's what he said sure i mean plaintiff has an appeal that let me get you to talk about this paragraph about authorized users authorized to use or with you within the context of this paragraph it's very hard for me to justify pulling just sentenced to out is it because you really seem to have two ideas there's authorize user light and there's authorized user full blown and authorized user of light is literally anyone including my six year old granddaughter who is using the card i believe me i could easily send her into a java juice and she would have no trouble giving the card to the sales person and getting the drink but then it goes on the next thing it says is someone who is at least fifteen years of age so i don't know why the language of your own agreement bars you from taking the steps that you would like to take in this case so first off i'm happy to address the merits of the question i just want to point out that there are two separate grounds here one is being bound as an authorized user under the contract the other is direct benefits a sample which i don't think turns on the language of this provision but you have the direct benefits to stop all requires us to think that buying one jam juice is enough to put you over that line from interactive direct and that's it's an aggressive position well i'm happy to address that position but let me address your question about the language of the authorized user provision you're certainly right that it creates two different types of authorized users no i'm saying i thought i don't see any language in here that that does that so i think that my reading of this credit one reading of this is that it creates two different types there are authorized users you can designate by saying i want my spouse to be an authorized user on the account i would like that person to have a card they will have all the benefits that run to the holder of the card under my contract you can also authorize someone to use your account by giving them your credit card doesn't say that don't mean the first sentences we made are discretion issue an additional card and then instead of talking about cards it talks about if you allow someone to use your account that person will be an authorized user without another words if you're going to get a card for that person they'll be an authorized user and then there are these restrictions on you know these six things that don't need to be read off i just i don't see where you come up with two classes of authorized user i think the first sentence refers to designation of a party who will hold their own card bearing your account number and that person is a designated author and then the second sentence you say is completely separate even though it's all in the same paragraph and every other word in the paragraph deals and i think there are chewed ways that people can use credit cards or critic had access to credit card accounts that are not their own form is that they can obtain a card that a physical access provides with their own name on it that gives them access to the account and the other is by being deputized by the holder of the card to use it so you can give it to your granddaughter and she can make to make a purchase i understand it sounds ridiculous in the context of a six year old but the whole that i'm telling you she could do it now i am yes i get it but when someone goes into a merchant and presents a credit card they are representing that they have the backing of credit one as the institution they are going to make good on that transaction and the person tendering the credit card what about judge ripples idea that the kid the kid is just her mother's agent at this point she's the mother could have tied the credit card to a robot and have it gotten gone in there or or to their her dog that's that's not the way that we've conceived of this we've conceived of this as a direct benefits but of course agency is another ground for binding a non signatory to an agreement i mean judith serrano pays for the phone at issue in this case using her credit when i'm not worried about the following you know i understand that but the mother is sort of lurking behind all the aspects of the case and in terms of the equities here liberating her daughter who is being represent who was when the suit was filed being represented by her mother as her guardian ad litum when her mother is the one who called using her daughter's phone to give the number to credit one when her mother posed as her daughter and communicating with credit want about the calls i don't think that the equities necessarily weigh in favor of this is using and i'm not worried about the equities in that sense i mean to supreme court has made it very clear that arbitration is a creature of agreement and if there is an agreement to arbitrate they think vigorous and saying you have to arbitrate that if there is no agreement we come with the other construction cases where the general contractor will have an agreement to arbitrate but one of the sub contractors doesn't and you've got to trace through thought to see if there's a binding agreement between the party that you're trying to bring into arbitration there is in they go but if there isn't they don't have to arbitrate that's certainly right the supreme court has also recognized admits the italian tellers in concepcion back and for there aren't non non contractual ways of binding a non secret signatory to an arbitration agreement and that includes among others direct benefits of stubble and as this court made clear in everett and in zurich when you obtain a benefit that flows directly from the contract you as if you were a signatory the only reason that eighty was able to use the credit card to make a purchase is because of the card member agreement she concedes in this appeal and before the district court she was aware there were contract terms that bound the card member her mother the credit card is precisely the benefit that a card member contracts for and so whether she was doing it at her mother's behest or not she had the choice when she wanted to the store as to whether to use the credit card or whether to use cash if she has a fourteen year old presumably she had some pocket cash on her but the point i want to how do you know now if you've been about fourteen year old the point is that when she went in with a credit card she represented that credit one was going to pay for her purchase that is the very benefit the card members contract for and that's the very benefit that she obtained presenting the credit card this is not a case about what she did with the purchase this is not a case about whether she had a sip of her mother's john but use the benefits she obtained is the very benefit parties contract when they when they enter into a card member of humans with credit card presented a sort of circuit split on this issue but none exist to every court is clear on this the cases that he says comprise the majority rule in the fifth circuit the eighth circuit on the fourth circuit all recognize explicitly that it's a destructive test you don't have to sue one  contract you can also take a direct benefit under the contract and so that legal question i don't think there's any serious what is and here is context about it i think that the factual question is was there a direct benefit here that is reviewed at least for clear  at best for abuse of discretion as the court also made me clear insurer and footnote to application of direct benefits established reviews reviewed for abuse of discretion there was no abuse of discretion finding that the purchase using the credit card was a direct benefit and certainly so when her daughter went in to complete the transaction and again that's more than your semantics that's i think a distinction that makes a difference she completed her mother's transaction one that her mother decided to engage in further just really quickly there's something of a split of the district courts the perera case where a husband is the only borrower on a loan that is used to finance an automobile and the testimony was clear if the wife drove it at least half the time the wife was not bound to the direct benefits of stop doctrine here we think the should obtain is well you know there's some some parsing about whether that what the the benefit is in how you actually use the agreement but when we think that's pushing the factual both the factual and legal