IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

PORTLAND DIVISION 

DANICA LOVE BROWN, individually 

and on behalf of all others similarly 

situated, 

Plaintiff, 

v. 

STORED VALUE CARDS, INC., dba 

NUMI Financial, CENTRAL 

NATIONAL BANK AND TRUST 

COMP ANY, ENID, OKLAHOMA, 

Defendants. 

MOSMAN,J., 

No. 3:15-cv-01370-MO 

OPINION AND ORDER 

Defendants seek to compel arbitration pursuant to the Federal Arbitration Act, 9 U.S.C. 

§§ 3 and 4. For the reasons set forth below, I DENY Defendants' Motion to Compel Arbitration 

[ECF 253]. Pursuant to this Court's Order from November 15, 2021, [ECF 262], the parties are 

ordered to provide supplemental briefing containing a state-by-state analysis of whether the 

Court should reach the same conclusion under the laws of the other states. Supplemental briefing 

is due on this issue by December 30, 2021. 

1 - OPINION AND ORDER 
BACKGROUND 

The parties are intimately familiar with the facts in this case, so I do not repeat them here. 

In the present motion, Defendants ask the Court to compel arbitration. 

LEGAL STANDARD 

The Federal Arbitration Act ("FAA") applies to all contracts involving interstate 

commerce and states in part that "an agreement in writing to submit to arbitration an existing 

controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable, and 

enforceable." 9 U.S.C. § 2. A party seeking to compel arbitration can do so under the FAA. 

Id.§ 4. 

The FAA "leaves no place for the exercise of discretion by a district court, but instead 

mandates that district courts shall direct the parties to proceed to arbitration on issues as to which 

an arbitration agreement has been signed." Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 

218 (1985). Under the FAA, the district court is "limited to determining (1) whether a valid 

agreement to arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute 

at issue." Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000). 

The burden is on the party seeking to compel arbitration to prove the existence of an 

agreement to arbitrate by a preponderance of the evidence. Knutson v. Sirius XM Radio Inc., 771 

F.3d 559, 565 (9th Cir. 2014). 

To determine whether a valid agreement to arbitrate exists, "federal courts 'apply 

ordinary state-law principles that govern the formation of contracts."' Nguyen v. Barnes & Noble 

Inc., 763 F.3d 1171, 1175 (9th Cir. 2014) (quoting First Options of Chi., Inc. v. Kaplan, 514 U.S. 

938, 944 (1995)). In Oregon, the ordinary state-law principles that govern the formation of 

contract are as follows: 

2 - OPINION AND ORDER 
Under Oregon law, whether a contract exists is a question of law. A contract is most 

commonly formed by an offer, an acceptance of that offer, and an exchange of 

consideration. Oregon applies an objective theory of contracts. That is, the existence and 

terms of a contract are determined by the evidence of the parties' communications and 

acts, not their subjective understandings. Oregon follows the mirror image rule of offer 

and acceptance. In Oregon, it is settled that the acceptance of an offer must correspond to 

the offer at every point, leaving nothing open for future negotiations. The acceptance 

must be positive, unconditional, unequivocal, and unambiguous, and must not change, 

add to, or qualify the terms of the offer. 

Reedv. Ezelle Inv. Props. Inc., 353 F. Supp. 3d 1025, 1031 (D. Or. 2018) (internal 

quotations and citations omitted). 

Under the objective theory of contracts, mutual assent is required. Ken Hood Const. Co. 

v. Pac. Coast Const., Inc., 201 Or. App. 568, 578, 120 P.3d 6 (Or. Ct. App. 2005). In Oregon, 

"whether the parties entered into a contract does not depend on their uncommunicated subjective 

understanding; rather it depends on whether the parties manifest assent to the same express 

terms." DCIPA, LLC v. Lucile Slater Packard Children's Hosp. at Stanford, 868 F. Supp. 2d 

1042, 1053 (D. Or. 2011) (internal quotation marks omitted). Courts look to the parties' 

"objective manifestations of intent, as evidenced by their communications and acts." Glob. Exec. 

Mgmt. Sols., Inc. v. Int'! Bus. Machs. Corp., 260 F. Supp. 3d 1345, 1368 (D. Or. 2017) (quoting 

Ken Hood, 120 P.3d at 11). 

DISCUSSION 

Defendants argue that Ms. Brown and other class members manifested their assent to the 

arbitration agreement contained in the Cardholder Agreement through (1) accepting the release 

cards, (2) not opting out of arbitration, and (3) using the cards to access the money. Mot. to 

Compel Arbitration [ECF 253] at 6, 8. The agreement given out with the card stated that through 

accepting the card, "you agree to be bound by the terms and conditions." Verschelden Deel. 

[ECF 149] Ex. 1-F at 2. Card recipients then had 30 days to opt out of arbitration. Id. at 3. 

3 - OPINION AND ORDER 
Ms. Brown asserts that "receiving an unrequested card and cardholder agreement does 

not create mutual assent." Resp. in Opp'n to Mot. to Compel Arbitration [ECF 257] at 7. She 

contends there is no objective manifestation of voluntary, mutual assent because class members 

received the cards upon their release from custody and the cardholder agreement "proclaimed 

recipients immediately agreed to its terms when the release card was handed to them." Id. at 7-8. 

Class members had no choice but to receive the money confiscated from them on the cards, the 

cards were activated before being handed to class members, and card activation started the 

accumulation of fees that would continue until the balance on the card was depleted. Id. at 8. 

Here, I find there is no valid agreement to arbitrate because there was no mutual assent. I 

address Defendants' three arguments as to why the Court should find mutual assent in turn. 

I. Acceptance of the Release Cards Does Not Create Mutual Assent. 

Here, I agree with Ms. Brown's argument that there is no mutual assent when the class 

members became committed to the terms of the contract before having any opportunity to review 

the terms of the Cardholder Agreement. 

In this case, the class members were handed a card that had already been activated. Y outz 

Deel. [ECF 258] Ex. 2 at 8. When the cards were handed to class members upon their release 

from jail, the Cardholder Agreement accompanied the cards. Defs.' Mot. to Compel Arb. [ECF 

253] at 7. The Cardholder Agreement reads: "By accepting this Card, you agree to be bound by 

these terms and conditions (the 'Agreement')." Verscheldon Deel. [ECF 149] Ex. 1-F at 2. Under 

these facts, there is simply no way it can be demonstrated that the "parties manifest[ ed] assent to 

the same express terms." DCIPA, LLC, 868 F. Supp. 2d at 1053 (internal quotation omitted). The 

record demonstrates that there was no communication before class members were handed the 

card and the card holder agreement. Further, class members were not afforded time to read the 

4 - OPINION AND ORDER 
cardholder agreement before it purported to bind them to arbitration. There are no 

communications or acts by the class members that demonstrate an objective manifestation of 

intent to be bound by the arbitration agreement. See Glob. Exec. Mgmt. Sols., Inc., 260 F. Supp. 

3d at 1368. Therefore, the class members' acceptance of the cards does not create mutual assent. 

II. Class Members Failure to Opt-Out of Arbitration Does Not Create Mutual 

Assent. 

Defendants argue that because the class members did not opt out of the arbitration 

agreement, they confirmed their assent to the arbitration agreement. Defs.' Mot. to Compel 

Arbitration [ECF 253] at 7. To support this point, Defendants cite to numerous district court 

cases that found arbitration agreements enforceable when the plaintiff failed to opt out. DeLoe v. 

Dep 't Stores Nat'! Bank, No. 3:17-cv-00022-SB, 2018 WL 4655765, at *5 (D. Or. Mar. 23, 

2018); Citibank SD. NA. v. Santoro, 210 Or. App. 344,349, 150 P.3d 429 (2006); Hillburn v. 

Encore Receivable Mgmt., Inc., No. 06-6096-HO, 2007 WL 8650773, at *2 (D. Or. July 11, 

2007); Ranginwala v. Citibank, N.A., No. 18-cv-14896, 2020 WL 6817508, at *4 (D. N.J. Nov. 

19, 2020); Ackerberg v. Citicorp USA, Inc., 898 F. Supp. 2d 1172, 1176 (N.D. Cal. 2012). 

Ms. Brown argues that these cases are distinguishable because "[i]n each of those cases, 

the customer requested and obtained a credit card to borrow money for purchases that were 

governed by terms of the bank's cardholder agreement. There was no dispute that the customers 

agreed to the terms in the cardholder agreement." Resp. in Opp'n to Mot. to Compel Arbitration 

[ECF 257] at 15. I agree with Ms. Brown. 

In my prior Opinion and Order on Defendants' First Motion to Compel Arbitration, I 

recognized that "Oregon courts have found 'conduct in using [a] card constitute[s] mutual assent 

to the terms of the credit card agreement' when a plaintiff applies for and receives a consumer 

credit card along with a card agreement." Opinion & Order [ECF 61] at 4 (citing Citibank S.D. 

5 - OPINION AND ORDER 
NA. v. Santoro, 210 Or. App. 344, 349, 150 P.3d 429 (2006)). I went on to state that "Oregon 

has never found an agreement where the card holder did not apply for the card." Id. 

I stand by my analysis from 2016 and again find that where the class members received a 

card they did not request upon their release from prison, failure to opt out of the arbitration 

agreement does not amount to mutual assent. 

Additionally, I agree with Ms. Brown's contention that there is no need for an individual to 

opt out of an arbitration provision of a contract that the individual did not agree to in the first 

place. Resp. in Opp'n to Mot. to Compel Arbitration [ECF 257] at 13. Knutson v. Sirius XM 

Radio Inc., 771 F.3d 559, 566 (9th Cir. 2014) stands for the proposition that "continued use of 

[a] service after [plaintiff's] receipt of the Customer Agreement did not manifest ... assent to the 

provisions in the Customer Agreement" because the court found that the plaintiff did not intend 

to enter into a contractual relationship with defendant in the first place. Therefore, the customer 

had no reason to read the customer agreement that mandated arbitration and opt-out. 

III. Class Members Use of the Card to Retrieve Their Own Money Does Not Show 

Mutual Assent. 

Defendants' final argument is that because the class members used the cards, they assented to 

arbitration. Mot. to Compel Arbitration [ECF 253] at 8. Here, Defendants again cite to cases, 

such as Citibank South Dakota NA. v. Santoro, 210 Or. App. 344, 150 P .3d 429 (2006), that 

involve individuals who requested credit cards to support the idea that use of a card demonstrates 

mutual assent. Ms. Brown counters that precedent from cases involving credit cards is 

inapplicable where, as here, the cards were not requested from the Defendants. Resp. in Opp'n to 

Mot. to Compel Arbitration [ECF 257] at 8-10. 

6 - OPINION AND ORDER 
Because, as discussed above, the cases involving individuals who requested credit cards from 

banks are inapposite here, I find that the class members use of the card to retrieve their own 

money does not demonstrate mutual assent. 

IV. The Parties Must Now Brief Whether Mutual Assent Exists Under the Laws of 

the Other States. 

In the Fall of 2020, Defendants moved for summary judgment, Mot. for Summ. J. [ECF 228], 

and Ms. Brown moved for class certification, Mot. to Certify Class [ECF 230]. I denied the 

Motion for Summary Judgment in its entirety, Opinion & Order [ECF 245], and granted in part 

and denied in part Ms. Brown's Motion for Class Certification. Opinion & Order [ECF 249]. 

In ruling on Ms. Brown's prior motion, I identified that, as it relates to the arbitration 

agreement, Ms. Brown failed to brief whether the mutual assent and consideration analysis 

varied by state. Id. at 8. For this reason, I denied Ms. Brown's request to certify a nationwide 

class and instead certified an Oregon subclass. 

The Opinion and Order went on to say "If, upon later briefing, I conclude that 

Defendants' arbitration argument fails under Oregon law, I will have the parties brief whether I 

should reach the same conclusion under the laws of other states." [ECF 249] at 8. As I find here 

that there is no mutual assent under Oregon law, and therefore no valid agreement to arbitrate, 

the parties are ordered, pursuant to this Court's November 15, 2021 Order, [ECF 262], to submit 

supplemental briefing containing a state-by-state analysis of whether I should reach the same 

conclusion under the laws of the other states. 

V. Other Issues 

Because the Court finds there is no valid agreement to arbitrate, the Court does not need to 

consider the other issues raised by Defendants in their motion. 

7 - OPINION AND ORDER 
CONCLUSION 

For the reasons stated above, Defendants' Motion to Compel Arbitration [ECF 253] is 

DENIED. Pursuant to this Court's Order from November 15, 2021, [ECF 262], the parties are 

ordered to provide supplemental briefing containing a state-by-state analysis of whether the 

Court should reach the same conclusion under the laws of the other states. As previously 

ordered, supplemental briefing is due by December 30, 2021. 

IT IS SO ORDERED. 

DATED this -ffeay of December, 2021. 

~~~ ICHAEL w. MOSMAN 

United States Dj§t.i:ier1udge 

8 - OPINION AND ORDER