Court Opinion

ID: 6221949
Source: CourtListenerOpinion
Date Created: 2022-02-15 20:00:28.418933+00
Date Added: 2024-06-11T08:57:24.959746
License: Public Domain

PUBLISHED

                     UNITED STATES COURT OF APPEALS
                         FOR THE FOURTH CIRCUIT

                                     No. 21-1058

WILLIAM T. LYONS, Individually and on Behalf of Others Similarly Situated,

                   Plaintiff - Appellee,

            v.

PNC BANK, National Association,

                   Defendant - Appellant.
———————————

CONSUMER FINANCIAL PROTECTION BUREAU,

                   Amicus Curiae.

                                     No. 21-1289

WILLIAM T. LYONS, Individually and on Behalf of Others Similarly Situated,

                   Plaintiff – Appellant,

            v.

PNC BANK, National Association,

                   Defendant – Appellee.
———————————

CONSUMER FINANCIAL PROTECTION BUREAU,

                   Amicus Curiae.
Appeal from the United States District Court for the District of Maryland, at Baltimore.
Stephanie A. Gallagher, District Judge. (1:20-cv-02234-SAG)

Argued: October 28, 2021                                   Decided: February 15, 2022

Before GREGORY, Chief Judge, QUATTLEBAUM, Circuit Judge, and FLOYD, Senior
Judge.

Affirmed in part, reversed in part by published opinion. Chief Judge Gregory wrote the
majority opinion, in which Senior Judge Floyd joined. Judge Quattlebaum wrote a separate
opinion concurring in part and dissenting in part.

ARGUED: Daniel J. Tobin, BALLARD SPAHR LLP, Washington, D.C., for
Appellant/Cross-Appellee. Ellen Louise Noble, PUBLIC JUSTICE, Washington, D.C.,
for Appellee/Cross-Appellant. Kevin E. Friedl, CONSUMER FINANCIAL PROTECTION
BUREAU, Washington, D.C., for Amicus Curiae. ON BRIEF: Matthew D. Lamb,
BALLARD SPAHR LLP, Washington, D.C., for Appellant/Cross-Appellee. Scott C. Borison,
BORISON FIRM LLC, San Mateo, California; Phillip R. Robinson, CONSUMER LAW
CENTER LLC, Silver Spring, Maryland; Karla Gilbride, PUBLIC JUSTICE,
Washington, D.C., for Appellee/Cross-Appellant. Stephen Van Meter, Acting General
Counsel, John R. Coleman, Deputy General Counsel, Steven Y. Bressler, Assistant General
Counsel, CONSUMER FINANCIAL PROTECTION BUREAU, Washington, D.C., for
Amicus Curiae.

                                           2
GREGORY, Chief Judge:

       William Lyons, Jr. filed suit against PNC Bank, N.A., alleging violations of the

Truth in Lending Act (“TILA”) related to PNC’s set-off of funds from two of Mr. Lyons’s

deposit accounts to pay the outstanding balance on a Home Equity Line of Credit

(“HELOC”). PNC moved to compel arbitration of the dispute based on an arbitration

provision in the parties’ agreement applicable to the two deposit accounts, and the district

court granted the motion as to one account and denied the motion as to the other account.

       We find that a provision of the Dodd-Frank Wall Street Reform and Consumer

Protection Act (“Dodd-Frank Act”) that amends TILA prohibits consumer agreements

related to residential mortgage loans from requiring the arbitration of claims. Because we

find that this provision precludes arbitration of Mr. Lyons’s claims related to both of his

deposit accounts, we affirm in part and reverse in part.

                                             I.

       Mr. Lyons opened a HELOC with National City Bank on February 4, 2005. J.A.

32–33. To do so, he signed an Equity Reserve Agreement that did not contain an arbitration

provision. J.A. 80–84. Five years later, on May 3, 2010, Mr. Lyons opened three deposit

accounts at PNC Bank. 1 J.A. 32. One of those deposit accounts was an account ending

2553 (“2010 Account”). J.A. 34, 44. In opening the 2010 Account, Mr. Lyons signed a

document that stated he was “bound by the terms and conditions of PNC Bank’s Account

       1
         PNC Bank merged with National City Bank in November 2009, and all parties
agree that PNC is the successor-in-interest to National City.
                                             3
Agreement for Checking Accounts and Saving Accounts” (“2010 Account Agreement”).

J.A. 32, 44. The 2010 Account Agreement included a provision authorizing PNC to set off

funds from the account to pay “[a]ny loans, overdrafts, obligations or other indebtedness

. . . now or hereafter owing to us by you.” J.A. 176. It also included a clause allowing

PNC to amend the Account Agreement and explaining the procedures it must follow to do

so. 2 See J.A. 177.

       In 2013, PNC added an arbitration clause 3 to the Account Agreement. J.A. 160,

211–13. The amended version of the Account Agreement (“2013 Account Agreement”)

stated that it took effect on February 1, 2013, but customers were given forty-five days to

opt out of the arbitration provision. J.A. 199, 211–12. PNC kept track of the opt-out

deadline for each customer, and its records show that Mr. Lyons had until June 11, 2013,

to opt out of the arbitration provision. J.A. 161.

       2
           The provision states in relevant part:

       We reserve the right to amend this Agreement . . . from time to time. Unless
       such change is favorable to you or is required by an emergency situation . . . ,
       an amendment will become effective 30 days (or such later time if required
       by law) after notice of the amendment is posted in our branches, or by such
       other method of notice as we may deem appropriate or as may be specifically
       required by applicable law.

J.A. 177 (emphasis added).
       3
           The relevant arbitration clause states:

       Under the terms of this Arbitration Provision . . . , Claims (as defined below)
       will be resolved by individual (and not class-wide) binding arbitration in
       accordance with the terms specified herein, if you or we elect it.

J.A. 211.
                                                4
       Mr. Lyons opened another deposit account with PNC Bank on June 6, 2014 (“2014

Account”) 4 and again agreed to be “bound by the terms and conditions” of the 2014 version

of the Account Agreement, which included the same arbitration clause as in the 2013

version. J.A. 162. Mr. Lyons was again provided an opportunity to opt out of the

arbitration provision and did not. Id.

          Mr. Lyons’s HELOC ended on February 4, 2015, as expected, but he did not finish

paying off the credit until June 17, 2020. J.A. 33–34. On September 26, 2019, PNC applied

a set-off of $1,396.97 from Mr. Lyons’s 2010 Account to pay the overdue HELOC

payment. J.A. 17, 34. On February 26, 2020, PNC applied another set-off of $1,589 from

the 2014 Account, which was also used to make a payment on the HELOC. J.A. 18; 23–

25; 35.

       Mr. Lyons filed suit against PNC in Circuit Court in June 2020 raising claims under

TILA. 5 J.A. 12–29. PNC removed the suit to federal court and filed a motion to compel

arbitration. J.A. 90–106. In its filings, PNC discussed only the most recent, August 11,

2019, version of the Account Agreement. Id.; J.A. 30–89. On November 15, 2020, after

the matter was fully briefed, the district court requested supplemental briefing on two

questions: “(1) whether the Arbitration Clause existing in the 2019 version of the Account

Agreement also existed in the Account Agreement at the time [Mr. Lyons] opened the

       4
          The district court refers to this account as the “2016 deposit account” because PNC
initially incorrectly informed the court that the account was opened on July 6, 2016. The
differing dates, however, are not material to this appeal.
       5
        Mr. Lyons also raised claims under the Real Estate Settlement Procedures Act but
those are not at issue in this appeal. J.A. 25–26.
                                             5
accounts in 2010 and 2016; and (2) if not, whether [Mr. Lyons] can be considered bound

to an Arbitration Clause added to the Account Agreement after the accounts were opened.”

J.A. 141; see also J.A. 107–22; 123–40. Both parties submitted supplemental memoranda

simultaneously on December 1, 2020. J.A. 143–280; 281–85. PNC’s supplemental

memorandum described for the first time the various versions of the Account Agreement.

J.A. 143–55.

       On January 6, 2021, the district court issued a memorandum opinion granting in part

and denying in part PNC’s motion to compel arbitration. J.A. 290–96; 302. The court found

that amendments made by the Dodd-Frank Act to TILA barred arbitration of Mr. Lyons’s

claims related to the 2014 Account because it was opened after the effective date of the

provisions but that those restrictions did not apply retroactively to bar arbitration of his

claims related to the 2010 account. J.A. 297–98. The court explained that the 2010

Account was updated to include an arbitration provision with an effective date of February

1, 2013—several months before June 1, 2013, the effective date of the relevant provisions

of Dodd-Frank. 6 J.A. 298. The court then found that the relevant Dodd-Frank provisions

did not apply retroactively to the 2010 Account because there was no language in the statute

       6
         The Dodd-Frank Act took effect on July 22, 2010. Pub. L. No. 111-203, 124 Stat.
1376. The Act provided that any “sections of this title for which regulations have not been
issued” eighteen months after its enactment “shall take effect on such date.” Dodd-Frank
Act § 1400(c), 124 Stat. at 2136. The Consumer Financial Protection Bureau (“CFPB”)
issued its final rule implementing the relevant section of the Act on January 20, 2013, and
provided an effective date for the provisions of June 1, 2013. See Loan Originator
Compensation Requirements Under the Truth in Lending Act (Regulation Z), 78 Fed. Reg.
11,280, 11,387 (Feb. 15, 2013) (to be codified at 12 C.F.R. pt. 1026).
                                             6
evidencing an intent for the provisions to overcome the presumption against retroactivity.

J.A. 297.

       PNC filed an appeal on January 12, 2021, and Mr. Lyons filed a cross-appeal on

January 25, 2021. J.A. 303–06. PNC appeals the district court’s partial denial of its motion

to compel arbitration, and Mr. Lyons cross-appeals the district court’s partial grant of the

motion to compel arbitration.

                                             II.

       We review a district court’s determination regarding the arbitrability of a dispute de

novo. See Mey v. DIRECTV, LLC, 971 F.3d 284, 288 (4th Cir. 2020); Aggarao v. MOL

Ship Mgmt. Co., Ltd., 675 F.3d 355, 365 (4th Cir. 2012) (“We review de novo a district

court’s determination on arbitrability of a civil action.”). In applying the de novo standard,

we must “give due regard to the federal policy favoring arbitration and resolve ‘any doubts

concerning the scope of arbitrable issues . . . in favor of arbitration.’” Hill v. Peoplesoft

USA, Inc., 412 F.3d 540, 543 (4th Cir. 2005) (quoting Moses H. Cone Mem’l Hosp. v.

Mercury Constr. Corp., 460 U.S. 1, 24–25 (1983)). But, while there is a general policy

favoring arbitration, “the [Federal Arbitration Act’s] mandate [can be] overridden by a

contrary congressional command.” See Compucredit Corp. v. Greenwood, 565 U.S. 95,

98 (2012). “If such an intention exists, it will be discoverable in the text of the [statute],

its legislative history, or an inherent conflict between arbitration and the [statute’s]

underlying purposes.” Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 24 (1991).

                                              7
The burden of establishing that “Congress intended to preclude a waiver of a judicial

forum” is on the party challenging arbitration. Id. at 26.

                                            III.

                                             A.

       The Dodd-Frank Act, which was passed in response to the 2008 financial crisis,

amended TILA, including by adding a section—§ 1639c(e)—entitled “Arbitration,” which

imposed restrictions on the use of mandatory arbitration agreements for mortgage-related

transactions. See 15 U.S.C. § 1639c(e). Two provisions of § 1639c(e) are relevant to this

case. First, § 1639c(e)(1) states:

       No residential mortgage loan and no extension of credit under an open end
       consumer credit plan secured by the principal dwelling of the consumer may
       include terms which require arbitration or any other nonjudicial procedure
       as the method for resolving any controversy or settling any claims arising out
       of the transaction.

15 U.S.C. § 1639c(e)(1) (emphasis added). Second, § 1639c(e)(3) states:

       No provision of any residential mortgage loan or of any extension of credit
       under an open end consumer credit plan secured by the principal dwelling of
       the consumer, and no other agreement between the consumer and the
       creditor relating to the residential mortgage loan or extension of credit
       referred to in [§ 1639c(e)(1)], shall be applied or interpreted so as to bar a
       consumer from bringing an action in an appropriate district court of the
       United States, or any other court of competent jurisdiction, pursuant to
       section 1640 of this title or any other provision of law, for damages or other
       relief in connection with any alleged violation of this section, any other
       provision of this subchapter, or any other Federal law.

15 U.S.C. § 1639c(e)(3) (emphasis added).

                                             8
       The district court found, in the alternative, that both § 1639c(e)(1) and § 1639c(e)(3)

would preclude the arbitration of Mr. Lyons’s claims, if the agreement arose today.

                                             B.

       First, we must consider whether the district court erred in interpreting the Dodd-Frank

Act to make the arbitration provision in Mr. Lyons’s Account Agreement inapplicable to his

set-off claims. The district court provided two independent statutory bases for finding that

the Dodd-Frank Act prohibits arbitration of the claims raised by Mr. Lyons in this case:

§ 1639c(e)(1) and § 1639c(e)(3). Since we agree that § 1639c(e)(3) bars arbitration of

Mr. Lyons’s claims, we need not determine whether § 1639c(e)(1) also applies and

prohibits arbitration of his claims.

       The plain language of § 1639c(e)(3) is clear and unambiguous: a consumer cannot

be prevented from bringing a TILA action in federal district court by a provision in an

agreement “relate[d] to” a residential mortgage loan—like a HELOC. See 15 U.S.C.

§ 1639c(e)(3). As the Supreme Court explained in Morales v. Trans World Airlines, Inc.,

504 U.S. 374 (1992), “[t]he ordinary meaning of [the] words [“relating to”] is a broad

one—‘to stand in some relation; to have bearing or concern; to pertain; refer; to bring into

association with or connection with,’” id. at 383 (quoting Black’s Law Dictionary 1158

(5th ed. 1979)). By all accounts, Mr. Lyons’s Account Agreement stands in relation to,

pertains to, refers to, and has bearing on or concerns his HELOC. PNC relied on a set-off

provision included in the deposit Account Agreement as a mechanism for repayment of the

                                              9
amount outstanding on his HELOC loan. Thus, by PNC’s own design, the Account

Agreement and the HELOC loan are connected. 7

          PNC insists, however, that § 1639c(e)(3) cannot prohibit arbitration of Mr. Lyons’s

claims because the provision was not intended to restrict agreements to arbitrate. Rather,

argues PNC, the provision limits a consumer from agreeing to waive certain claims but

does not control the proper judicial forum for resolution of such claims. Appellant’s Br.

30–31. In support of this argument, PNC notes that § 1639c(e)(3) does not include the

term “arbitration” and cites to a series of Supreme Court cases which have held that

arbitration is not precluded merely because a statute provides a plaintiff with a cause of

action.       See CompuCredit, 565 U.S. at 101 (“We have repeatedly recognized that

contractually required arbitration of claims satisfies the statutory prescription of civil

liability in court.”); Gilmer, 500 U.S. at 27–28; Shearson/American Express v. McMahon,

482 U.S. 220, 238–40 (1987); Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473

U.S. 614, 628–40 (1985).

        Although few prior courts have interpreted § 1639c(e)(3), two recent district courts
          7

have similarly interpreted the provision. See Attix v. Carrington Mortg. Servs., LLC, No.
1:20-cv-22183-UU, 2020 WL 5757624 (S.D. Fla. Sept. 16, 2020); Thomas-Lawson v.
Carrington Mortg. Servs., LLC, No. 2:20-cv-07301-ODW, 2021 WL 1253578 (C.D. Cal.
Apr. 5, 2021). In Attix and Thomas-Lawson, the district courts considered an agreement
between a homeowner, his mortgage servicer, and a third-party payment processor, which
provided for the homeowner to make mortgage payments by phone. Attix, 2020 WL
5757624; Thomas-Lawson, 2021 WL 1253578. The Attix court found “the statutory
language [of § 1639c(e)(3)] to be clear and unambiguous” and found that “[m]aking a
payment on a residential mortgage loan certainly ‘relate[s] to the residential mortgage
loan.’” 2020 WL 5757624, at *9; see also Thomas-Lawson, 2021 WL 1253578, at *3
(“[A]gree[ing] with the Attix court’s reasoning and reach[ing] the same conclusion here.”).
As in Attix and Thomas-Lawson, the Account Agreement here provides a method for the
payment of Mr. Lyons’s HELOC and so it “relates to” his HELOC.
                                              10
       But these cases are inapposite. In contrast to the provisions at issue in the cases

cited by PNC, which authorize a cause of action, § 1639c(e)(3) expressly prohibits a

covered agreement from barring a consumer “from bringing an action in an appropriate

district court of the United States, or any other court of competent jurisdiction.” 15 U.S.C.

§ 1639c(e)(3). There is a substantive difference between finding that arbitration is an

appropriate alternative mechanism to enforce a statutorily created right to sue and

overriding an express congressional command proscribing waiver of a specific judicial

forum. Cf. Mitsubishi, 473 U.S. at 628 (“Having made the bargain to arbitrate, the party

should be held to it unless Congress itself has evinced an intention to preclude a waiver of

judicial remedies for the statutory rights at issue.” (emphasis added)); Gilmer, 500 U.S. at

26.

       Further, PNC’s position is difficult to reconcile with the structure of Dodd-Frank.

While the text of § 1639c(e)(3) does not include the term “arbitration,” the provision is

found in a short section of the Act entitled “Arbitration.” See generally Yates v. United

States, 574 U.S. 528, 540 (2015) (“While . . . headings are not commanding, they supply

cues [as to congressional intent].”); Almendarez-Torres v. United States, 523 U.S. 224, 234

(1998) (noting that “‘the title of a statute and the heading of a section’ are ‘tools available

for the resolution of a doubt about the meaning of a statute.’” (quoting Brotherhood of R.R.

Trainmen v. Balt. & Ohio R.R. Co., 331 U.S. 519, 528–29 (1947))). Moreover, our

interpretation is consistent with the legislative history of the provision; in a

contemporaneous report, Congress described § 1639c(e) as “prohibit[ing] mandatory

arbitration clauses.” H.R. Rep. No. 111-517, at 877 (2010). And it is also consistent with

                                              11
the CFPB’s implementing regulations, which state that “[the] prohibition [in § 1639c(e)(3)]

does not limit a consumer and creditor or any assignee from agreeing, after a dispute or

claim under the transaction arises, to settle or use arbitration or other non-judicial

procedure to resolve that dispute or claim.” 12 C.F.R. § 1026.36(h). This regulation would

be unwarranted unless § 1639c(e)(3) prohibits pre-dispute agreements to resolve claims in

a non-judicial forum.

       Given the unambiguous language of § 1639c(e)(3), it is implausible that Congress did

not intend the provision to prohibit pre-dispute arbitration agreements. Since, Mr. Lyons’s

Account Agreement clearly “relates to” his HELOC agreement, we find that, properly

interpreted, § 1639c(e)(3) bars arbitration of Mr. Lyons’s set-off claims.

                                            IV.

                                            A.

       Having determined that § 1639c(e)(3) precludes arbitration of Mr. Lyons’s set-off

claims, we must next determine whether the district court nevertheless erred by finding that

the provision applied to bar arbitration of Mr. Lyons’s claims related to the 2014

Account—even though the parties had a long-standing, and pre-existing depository

relationship prior to the effective date of the relevant Dodd-Frank provisions.

       The district court found that § 1639c(e)(3) precluded arbitration of Mr. Lyons’s

claims related to the 2014 Account because that Account was opened after the provision’s

effective date. The court concluded that § 1639c(e)(3) did not preclude arbitration of

claims related to the 2010 Account, however, because that Account “was updated to

                                            12
include an arbitration provision and a class action waiver effective February 1, 2013,” prior

to the effective date of Dodd-Frank. The district court then determined that § 1639c(e)(3)

did not apply retroactively to arbitration agreements formed before its effective date and,

therefore, did not apply retroactively to the arbitration clause added in the 2013 Account

Agreement.

       On appeal, PNC contends that the district court erred in denying its motion to compel

arbitration of claims related to the 2014 Account because the court should have found that

those claims are arbitrable pursuant to the arbitration clause found in the 2013 Account

Agreement. Appellant’s Br. 15–18. Specifically, PNC argues that when Mr. Lyons opened

the 2014 Account, he was not entering a new contractual relationship with PNC but merely

continuing an existing relationship with the bank and, therefore, that the later Account is

properly covered by the arbitration provision in the earlier Account Agreement. Id. at 16–

17. In support of this argument, PNC points to the text of the Account Agreement, which

it argues shows a clear intent to cover all depository accounts between Mr. Lyons and PNC,

including future accounts. Id. at 16. For example, one provision of the 2010 Account

Agreement states that “[a]ll PNC Bank checking, savings, and money market accounts are

subject to this Account Agreement, including the products currently listed in the Consumer

Schedule of Service Charges and Fees.” J.A. 168.

       But a review of the record makes clear that the arbitration provision applicable to

the 2010 Account via the 2013 Account Agreement was not entered into by Mr. Lyons

until June 11, 2013—ten days after the effective date of § 1639c(e)(3).           Thus, the

                                             13
arbitration clause is precluded by § 1639c(e)(3) from applying to Mr. Lyons’s claims

related to either the 2010 Account or the 2014 Account.

       “[T]he issue of whether an arbitration agreement has been formed is an issue of

contract law,” and so “we apply the ‘ordinary state-law principles that govern the formation

of contracts.’” Berkeley Cnty. Sch. Dist. v. Hub Int’l Ltd., 944 F.3d 225, 236 (4th Cir.

2019) (quoting Minnieland Private Day Sch., Inc. v. Applied Underwriters Captive Risk

Assurance Co., 913 F.3d 409, 415 (4th Cir. 2019)). Under Maryland law, a consumer’s

silence, including a failure to opt out, may be considered an acceptance of modified terms

so long as the parties’ original agreement provides that such silence, following a specified

form of notice, will be considered assent to the new terms. See DIRECTV Inc. v. Mattingly,

829 A.2d 626, 633 (Md. 2003). Further, “it is well-established in Maryland that ‘laws

subsisting at the time of the making of a contract enter into and form a part thereof as if

expressly referred to or incorporated in its terms . . . .” John Deere Constr. & Forestry Co.

v. Reliable Tractor, Inc., 406 Md. 139, 146 (2008) (emphasis added) (quoting Dennis v.

Mayor & City Council of Rockville, 286 Md. 184, 189 (1979) (further noting that “the

principle embraces alike those provisions which affect the validity, construction, discharge

and enforcement of the contract”)).

       Although the stated effective date of the 2013 Account Agreement was February 1,

2013, customers were given forty-five days to opt out of the Arbitration Clause. J.A. 199.

Here, PNC’s own records show that Mr. Lyons had until June 11, 2013, to opt out of the

arbitration provision. See J.A. 211. When Mr. Lyons failed to opt out by the deadline, PNC

was entitled to consider Mr. Lyons’s silence as an acceptance of the arbitration provision,

                                             14
including its effective date of February 1, 2013, but PNC could only do so after the specified

opt-out period had lapsed. Thus, the arbitration agreement between Mr. Lyons and PNC

was not formed until June 11, 2013—after the effective date of § 1639c(e)(3).

       Of course, two parties may, as here, agree to bind their prior conduct with an earlier

effective date. But in doing so, they cannot ignore a statutory mandate existing at the time

of their agreement. See John Deere, 406 Md. at 146. Indeed, without such a rule, parties

could contract around congressional commands merely by selecting an effective date for

their agreement that predates the effective date of an unfavorable statute, rendering it a

dead letter.

       Since the 2013 arbitration agreement between Mr. Lyons and PNC was not formed

until after the effective date of § 1639c(e)(3), the provision applies prospectively to both

the 2010 Account and the 2014 Account. 8

                                              B.

       PNC argues, however, that we lack jurisdiction to review the district court’s order

compelling arbitration of the 2010 Account Agreement. It is true that orders compelling

arbitration are usually not appealable under § 16(b) of the Federal Arbitration Act

(“FAA”). See 9 U.S.C. § 16(b) (“Except as otherwise provided . . . an appeal may not be

taken from an interlocutory order . . . (2) directing arbitration to proceed under section 4 of

this title.”) But as many of our sister circuits have found, this prohibition does not apply

       8
          Since we find that the formation of the relevant arbitration agreement postdates
the effective date of the relevant provisions of Dodd-Frank, we need not consider, as the
district court did, whether the Act’s provisions would apply retroactively to the agreement
if it predated the Act’s effective date.
                                              15
to pendent appellate jurisdiction. 9 See Johnson v. Consumerinfo.com, Inc., 745 F.3d 1019,

1023 n.3 (9th Cir. 2014) (“Nor does § 16(b) restrict pendant appellate jurisdiction.” (citing

Quackenbush v. Allstate Ins. Co., 121 F.3d 1372, 1379 (9th Cir. 1997)); Freeman v.

Complex Computing Co., Inc., 119 F.3d 1044, 1050 (2d Cir. 1997) (holding that “[there is]

in the FAA no indication by Congress that the long-standing doctrine of pendent appellate

jurisdiction is totally eliminated as to appeals of orders staying federal court proceedings

pending arbitration” and exercising pendent appellate jurisdiction over an appeal of an

order compelling arbitration); Nat’l R.R. Passenger Corp. v. ExpressTrak, LLC, 330 F.3d

523, 529 (D.C. Cir. 2003) (same); see also Manion v. Nagin, 255 F.3d 535, 540 (8th Cir.

2001) (indicating that the Eighth Circuit would exercise pendent appellate jurisdiction over

an interlocutory order directing arbitration if it is “‘inextricably intertwined’ with” or

“necessary to ensure meaningful review of” an appealable issue (citation omitted)). But

       9
          My good colleague in dissent cites to several cases to argue that “our prior
decisions point in a different direction.” Dissenting Op. 21. But, as he recognizes, the
cases he cites do not deal with the same context, and we find them unavailing. See, e.g.,
Stedor Enters., Ltd. v. Armtex, Inc., 947 F.2d 727, 729–32 (4th Cir. 1991) (considering
whether an order compelling arbitration was appealable as a “final decision” and also
recognizing the pre-existing background law against which Congress legislated in passing
the FAA); In re Pisgah Contractors, Inc., 117 F.3d 133, 136 (4th Cir. 1997) (describing
the general requirements of § 16 and finding that the district court’s single order
compelling arbitration was not appealable without considering, or reason to consider,
pendent appellate jurisdiction); Moses v. CashCall, Inc., 781 F.3d 63, 79–81 (4th Cir. 2015)
(per curiam) (recognizing that “the doctrine of pendent appellate jurisdiction is available
‘when an issue is inextricably intertwined with a question that is the proper subject of an
immediate appeal’” (citation omitted) but declining to apply it on the facts of that case,
which did not include an interlocutory order under § 16(b)); United States v. Bankers Ins.
Co., 245 F.3d 315, 319 (4th Cir. 2001) (discussing a district court’s lack of discretion under
§ 3 of the FAA to deny a stay “[i]f the issues in the case are within the contemplation of
the arbitration agreement” and not discussing the FAA’s restrictions on appellate review
of such interlocutory orders under § 16(b)).
                                             16
see Moglia v. Pac. Emps. Ins. Co. of N. Am., 547 F.3d 835, 838–39 (7th Cir. 2008). See

generally Braintree Lab’ys, Inc. v. Citigroup Glob. Markets Inc., 622 F.3d 36, 44–45 (1st

Cir. 2010) (noting that other circuits disagree over whether pendent appellate jurisdiction

“permit[s] the review of interlocutory orders that § 16 brands as non-appealable” but taking

no position based on the facts of that case); Al Rushaid v. Nat’l Oilwell Varco, Inc., 814

F.3d 300, 303–04 (5th Cir. 2016) (declining to exercise pendent appellate jurisdiction over

an order compelling arbitration but “without deciding whether pendent appellate

jurisdiction may properly be exercised in this context”).

       “Pendent appellate jurisdiction is an exception of limited and narrow application

driven by considerations of need, rather than of efficiency.” Rux v. Republic of Sudan, 461

F.3d 461, 475 (4th Cir. 2006). It is appropriate only “(1) when an issue is ‘inextricably

intertwined’ with a question that is the proper subject of an immediate appeal; or (2) when

review of a jurisdictionally insufficient issue is ‘necessary to ensure meaningful review’ of

an immediately appealable issue.” Id. at 475 (citing Swint v. Chambers Cnty. Comm’n,

514 U.S. 35, 50–51 (1995)). “Two separate rulings are ‘inextricably intertwined’ if ‘the

same specific question will underlie both the appealable and the non-appealable order, such

that resolution of the question will necessarily resolve the appeals from both orders at

once.’” Scott v. Fam. Dollar Stores, Inc., 733 F.3d 105, 111 (4th Cir. 2013) (quoting Ealy

v. Pinkerton Gov. Servs., Inc., 514 F. App’x 299, 309 (4th Cir. 2013) (per curiam)); see

also Myers v. Hertz Corp., 624 F.3d 537, 553 (2d Cir. 2010).

       In this case, the district court’s partial grant of PNC’s order to compel arbitration of

the 2010 Account is “inextricably intertwined” with the district court’s partial denial of the

                                              17
order to compel arbitration of the 2014 Account because our consideration of the latter

order necessarily resolves the former. As discussed above, PNC contends on appeal that

the district court erred in finding that § 1639c(e)(3) precluded arbitration of Mr. Lyons’s

claims related to the 2014 Account because it should have found that the arbitration

provision in the 2013 Account Agreement applied to the 2014 Account. We find, however,

that PNC cannot rely on the arbitration clause in the 2013 Account Agreement to require

arbitration of claims related to the 2014 Account because Mr. Lyons did not accept the terms

of the arbitration clause until June 11, 2013—after the effective date of § 1639c(e)(3), which

prohibits the arbitration of such claims. The same issue underlies and necessarily resolves

the arbitrability of Mr. Lyons’s claims related to the 2010 Account. Since the arbitration

clause in the 2013 Account Agreement was not agreed to until June 11, 2013, it also cannot

prevent § 1639c(e)(3) from precluding arbitration of Mr. Lyons’s claims related to the 2010

Account.

                                                  ***

       Because we find that § 1639c(e)(3) of the Dodd-Frank Act precludes pre-dispute

agreements requiring the arbitration of claims related to residential mortgage loans and that

the arbitration agreement relevant to this appeal was not formed until after the effective

date of § 1639c(e)(3), we find that PNC may not compel arbitration of Mr. Lyons’s claims

as to both the 2010 Account and the 2014 Account.

                                         AFFIRMED IN PART AND REVERSED IN PART

                                             18
QUATTLEBAUM, Circuit Judge, concurring in part and dissenting in part:

       I agree with the majority’s analysis that 15 U.S.C. § 1639c(e)(3) applies to the kind

of set-off claim Mr. Lyons raises here. I also concur that § 1639c(e)(3) bars arbitration over

the 2014 Account because both the account and its own terms and conditions postdate

Dodd-Frank. Cf. Maj. Op. 5 (“Mr. Lyons . . . again agreed to be ‘bound by the terms and

conditions’ of the 2014 version of the Account Agreement, which included the same

arbitration clause as in the 2013 version. Mr. Lyons was again provided an opportunity to

opt out of the arbitration provision and did not.” (internal citation omitted)). I write

separately from my colleagues, however, because I do not believe we have jurisdiction to

adjudicate Mr. Lyons’s cross-appeal. Thus, I would limit our analysis to resolving PNC

Bank’s appeal—whether the district court erred in denying PNC Bank’s motion to compel

arbitration as to the 2014 Account—and proceed no further.

       “Federal courts are courts of limited jurisdiction. They possess only that power

authorized by Constitution and statute, which is not to be expanded by judicial decree. It is

to be presumed that a cause lies outside this limited jurisdiction, and the burden of

establishing the contrary rests upon the party asserting jurisdiction.” Kokkonen v. Guardian

Life Ins. Co. of Am., 511 U.S. 375, 377 (1994) (internal citations omitted).

       Accordingly, we may address Mr. Lyons’s cross-appeal on the merits only if we

have the jurisdiction to do so. I start from a premise that “borders on the axiomatic”—

“subject to certain limited exceptions, our appellate jurisdiction is limited to final orders

from the district courts.” Rux v. Republic of Sudan, 461 F.3d 461, 474 (4th Cir. 2006)

(citing 28 U.S.C. § 1291). And of course, there is no final order in our dispute. The district

                                             19
court’s interlocutory decision does not provide appellate jurisdiction under the typical

exceptions either, such as an injunction decision or a question certified by a district judge.

See 28 U.S.C. § 1292.

       Mr. Lyons argues that we may reach his cross-appeal because we have pendent

appellate jurisdiction. “Pendent appellate jurisdiction is a ‘judicially-created, discretionary

exception to the final judgment requirement’ that allows the Court to ‘retain the discretion

to review issues that are not otherwise subject to immediate appeal when such issues are

so interconnected with immediately appealable issues that they warrant concurrent

review.’” Rainbow Sch., Inc. v. Rainbow Early Educ. Holding LLC, 887 F.3d 610, 622 (4th

Cir. 2018).

       The problem with his argument is that the Federal Arbitration Act explicitly

prohibits us from exercising such discretion. The Act generally states that “an appeal may

not be taken from an interlocutory order—(1) granting a stay of any action under section 3

of this title; [or] (2) directing arbitration to proceed under section 4 of this title . . . .” 9

U.S.C. § 16(b). And since the district court compelled arbitration under Sections 3 and 4

of the Federal Arbitration Act, § 16(b) directly applies.

       The majority concludes that our discretion over pendent appellate jurisdiction

trumps the Federal Arbitration Act’s explicit bar. In doing so, the majority cites to

precedent from other circuits. Yet the majority overlooks the fact that even our sister courts

are split on this debate. Compare Al Rushaid v. Nat’l Oilwell Varco, Inc., 814 F.3d 300,

303–04 (5th Cir. 2016), and Moglia v. Pac. Emps. Ins. Co. of N. Am., 547 F.3d 835, 838

(7th Cir. 2008), with Nat’l R.R. Passenger Corp. v. ExpressTrak, L.L.C., 330 F.3d 523,

                                               20
527–28 (D.C. Cir. 2003), and Freeman v. Complex Computing Co., 119 F.3d 1044, 1049–

50 (2d Cir. 1997), and Johnson v. Consumerinfo.com, Inc., 745 F.3d 1019, 1023 n.3 (9th

Cir. 2014). See generally Braintree Lab’ys, Inc. v. Citigroup Glob. Markets Inc., 622 F.3d

36, 44–45 (1st Cir. 2010) (recognizing the “disagree[ment] over whether this seldom-used

doctrine could ever permit the review of interlocutory orders that § 16 brands as non-

appealable” and declining to take a position because there was no pendent appellate

jurisdiction under the facts of that case).

       And while this Circuit has not explicitly spoken on this matter, our prior decisions

point in a different direction. First, our decision in Stedor Enterprises, Ltd. v. Armtex, Inc.,

947 F.2d 727, 729–32 (4th Cir. 1991), strictly applies the text of the Act, albeit in the

context of determining whether an order compelling arbitration was “final” when the

arbitrability of the dispute was the only issue before the district court. Following that

approach here would require adhering to § 16(b)’s jurisdictional bar. See also In re Pisgah

Contractors, Inc., 117 F.3d 133, 136 (4th Cir. 1997) (discussing how the Federal

Arbitration Act limits the immediate review of a decision favoring arbitration to “only two

circumstances,” which are a final decision and an interlocutory appeal certification

pursuant to 28 U.S.C. § 1292(b)); Moses v. CashCall, Inc., 781 F.3d 63, 79–80 (4th Cir.

2015) (per curiam) (noting that the court should not apply pendent appellate jurisdiction to

convert “a narrow, statutorily authorized interlocutory appeal into a full-blown appeal”).

       Second, we have recognized that when Congress expressly prohibited us from

hearing an interlocutory order, we have no discretion to expand our jurisdiction. See United

States v. Bankers Ins. Co., 245 F.3d 315, 319 (4th Cir. 2001) (discussing how the Federal

                                              21
Arbitration Act removes typical court discretion, such as denying stays of arbitrable

matters); cf. Apprendi v. New Jersey, 530 U.S. 466, 482 n.9 (2000) (“[J]udges’ discretion

is constrained by the ‘limits fixed by law.’”). Combining these two principles with the fact

that the presumption lies in restraining our jurisdiction, I do not see how Mr. Lyons may

overcome the FAA’s statutory bar to our jurisdiction. *

       I realize my view would place the parties in an awkward procedural situation. If we

lack jurisdiction over Mr. Lyons’s cross-appeal, as I believe we do, the parties must

simultaneously litigate related issues in federal court and in arbitration. Of course,

addressing the cross-appeal now may be more efficient in this particular case. But our task

should be to follow the law wherever it takes us, not fashion the most efficient remedy in

a particular case—especially when doing so deviates from the Federal Arbitration Act’s

statutory bar to our appellate jurisdiction. Importantly, “[w]e are constrained by the

       *
          Even if we may somehow overcome this statutory bar, I also question how Mr.
Lyons establishes the limited exceptions justifying pendent appellate jurisdiction. Pendent
appellate jurisdiction is available only if (1) the issue “is ‘inextricably intertwined’ with a
question that is the proper subject of an immediate appeal,” or (2) a “review of a
jurisdictionally insufficient issue is ‘necessary to ensure meaningful review’ of an
immediately appealable issue.” Rainbow Sch., 887 F.3d at 622. Mr. Lyons primarily relies
on the first exception. “Two separate rulings are ‘inextricably intertwined’ if ‘the ‘same
specific question’ will ‘underlie both the appealable and the non-appealable order,’ such
that resolution of the question will necessarily resolve the appeals from both orders at
once.’” Scott v. Fam. Dollar Stores, Inc., 733 F.3d 105, 111 (4th Cir. 2013) (emphases
added). And when we decide the arbitrability of the 2014 Account, we need not decide how
the 2013 Account Agreement implicates the 2014 Account. When Mr. Lyons opened the
2014 Account, that Account had its own account agreement—including another arbitration
clause that would only become effective once a new opt-out period expired. See Maj. Op.
5 (citing J.A. 162). More importantly, the arbitration clause in the 2014 Account
Agreement clearly postdated the effective date of Dodd-Frank’s arbitration bar, both in the
arbitration clause’s inception and in its expiration of the opt-out period. Such resolution in
no way would implicate how we decide arbitrability of the 2010 Account.
                                              22
language of the Supreme Court as well as our own precedent from recognizing efficiency

considerations as a basis for the exercise of pendent appellate jurisdiction.” Rux, 461 F.3d

at 475.

          Because we lack jurisdiction to consider Mr. Lyons’ cross-appeal, I respectfully

dissent from my colleagues on the issues related to the 2010 Account.

                                             23