Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_11-cv-01822/USCOURTS-casd-3_11-cv-01822-1/pdf.json

Nature of Suit Code: 480
Nature of Suit: Consumer Credit
Cause of Action: 28:1332 Diversity-Other Contract

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

KARIN O’BRIEN, on behalf of herself and

all others similarly situated,

Plaintiff,

Case No. 11cv01822 BTM (BGS)

ORDER DENYING DEFENDANT’S

MOTION FOR REVIEW OF

MAGISTRATE’S ORDER AND

DENYING WITHOUT PREJUDICE

DEFENDANT’S MOTION TO

COMPEL ARBITRATION

v.

AMERICAN EXPRESS COMPANY,

Defendant.

Plaintiff Karin O’Brien brings this putative class action under the Telephone Consumer

Protection Act (“TCPA”), 47 U.S.C. § 227, alleging that Defendant American Express

contacted her and others similarly situated by telephone without express prior consent and

in violation of the TCPA. In October 2011, Defendant filed a motion to compel arbitration

based on the arbitration provision in the “Cardmember Agreement” between Plaintiff and

Defendant (Doc. 6). The motion hearing date on the motion to compel arbitration was

postponed, pending the resolution of a dispute between the parties regarding Plaintiff’s

request for discovery on the making of the arbitration agreement and on whether the

agreement is unconscionable. On May 8, 2012, Magistrate Judge Bernard Skomal granted

Plaintiff’s request for limited discovery. Pending before the Court is Defendant “Motion for

Review of Magistrate’s Order Pursuant to Fed. R. Civ. P. 72(a)” (Doc. 22), as well as the

original motion to compel arbitration.

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When considering objections to a magistrate judge’s non-dispositive discovery order

under Fed. R. Civ. P. 72(a), the district judge must modify or set aside any part of the order

“that is clearly erroneous or is contrary to law.” A magistrate judge’s non-dispositive order

“is entitled to great deference by the district court.” United States v. Abonce-Barrera, 257

F.3d 959, 969 (9th Cir. 2001).

The Federal Arbitration Act (“FAA”) “calls for a summary and speedy disposition of

motions or petitions to enforce arbitration clauses,” Moses H. Cone Mem’l Hosp. v. Mercury

Constr. Corp., 460 U.S. 1, 29 (1983), and therefore discovery in connection to a motion to

compel arbitration is available “only if ‘the making of the arbitration agreement or the failure,

neglect, or refusal to perform the same be in issue.’” Simula, Inc. v. Autoliv, Inc., 175 F.3d

716, 726 (9th Cir. 1999) (citations omitted). “[T]he making of the arbitration agreement is in

issue if the plaintiff alleges that the arbitration clause was fraudulently induced, that one party

had overwhelming bargaining power, or that the agreement does not exist.” Hibler v. BCI

Coca-Cola Bottling Co. of L.A., No. 11cv00298 JLS (NLS), 2011 WL 4102224, at *1 (S.D.

Cal. Sept. 14, 2011). 

Magistrate Judge Skomal found that the allegations in Plaintiff’s motion sufficiently

placed the making of the agreement in issue, such that limited “discovery is relevant to the

formation or making of the agreement[.]” (Doc. 20 at 3.) The Court finds no clear error in

this determination or in Magistrate Judge Skomal’s decision to grant seven limited requests

for document discovery (Doc. 20 at 7-10), and, accordingly, DENIES Defendant’s Rule 72(a)

motion. The parties shall complete the discovery ordered by Magistrate Judge Skomal within

60 days of the entry of this order. Any disputes regarding the scope or content of discovery

shall be referred to Magistrate Judge Skomal.

The Court also notes that as a result of the ongoing discovery dispute between the

parties, over ten months have elapsed since the filing of the original motion to compel

arbitration. The Court finds that the presentation of the issues presented by the motion to

compel arbitration would be assisted by the development of the factual record through limited

discovery, and by updated legal briefing incorporating relevant legal authorities issued within

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the past year. Accordingly, the Court DENIES Defendant’s motion to compel arbitration

without prejudice, and with leave to reinstate the motion within 30 days of the close of the 60-

day discovery period. Any reinstated motion to compel arbitration will be set for hearing on

Friday, January 18, 2013, at 11:00 a.m. There shall be no oral argument unless

requested by the Court. Plaintiff shall file any opposition to Defendant’s reinstated motion

to compel arbitration on or before January 4, 2013, and Defendant shall file any reply on or

before January 11, 2013.

IT IS SO ORDERED.

DATED: August 21, 2012

BARRY TED MOSKOWITZ, Chief Judge

United States District Court

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