Court Opinion

ID: 3154870
Source: CourtListenerOpinion
Date Created: 2015-11-16 16:00:52.754694+00
Date Added: 2024-06-11T12:47:22.107262
License: Public Domain

Case: 15-12066     Date Filed: 11/16/2015    Page: 1 of 12

                                                               [DO NOT PUBLISH]

                IN THE UNITED STATES COURT OF APPEALS

                         FOR THE ELEVENTH CIRCUIT
                           ________________________

                                 No. 15-12066
                             Non-Argument Calendar
                           ________________________

                        D.C. Docket No. 1:12-cv-01397-SCJ

TYLER KASPERS,
individually and on behalf of all others similarly situated,

                                                                  Plaintiff-Appellant,

                                        versus

COMCAST CORPORATION,

                                                               Defendant-Appellee.

                           ________________________

                    Appeal from the United States District Court
                       for the Northern District of Georgia
                          ________________________

                                (November 16, 2015)

Before MARTIN, ROSENBAUM, and ANDERSON, Circuit Judges.

PER CURIAM:
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       Tyler Kaspers, a Georgia attorney proceeding pro se1, appeals the district

court’s order compelling arbitration of his individual claims against Comcast

Corporation and its dismissal of his claims brought on behalf of a proposed class.

On appeal, Kaspers argues that the district court erred in holding that the

arbitration provision in his subscriber agreement, “as applied,” was neither

unconscionable nor violative of public policy. He further asserts that the court

erroneously dismissed his class claims on the basis of a class-action waiver. After

careful review, we affirm.

                                               I.

       This six-year saga began when Kaspers obtained cable and Internet service

from Comcast for his residence in Sandy Springs, Georgia. Over a seven-month

period beginning in January 2009, Kaspers did not receive full cable service except

for a two-week period in August 2009. Comcast technicians visited the property

over ten times to attempt to resolve the issues, but to no avail. Eventually, a

technician informed Kaspers that he would receive full service only if a new wire

were run from Kaspers’s house to the street. To do that, Comcast needed to dig a

180-foot-long trench through Kaspers’s front yard. Kaspers agreed but, despite the

trench, full service still was not restored.

       1
          Because Kaspers is a licensed attorney, we do not give him the benefit of the liberal
construction we normally accord pro se litigants. See Olivares v. Martin, 555 F.2d 1192, 1194
n.1 (5th Cir. 1977).
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      These service issues led to billing disputes. Because he was not receiving

full service, Kaspers on numerous occasions attempted to obtain from Comcast a

refund of or credit for its monthly service charges. Kaspers also objected to

Comcast’s charging him a $250 service fee to dig up his front yard. Eventually,

Kaspers canceled his Comcast subscription and refused to pay the outstanding debt

Comcast claimed he owed. At some point, Comcast referred Kaspers’s purported

debt to a collection agency.

      Comcast’s subscriber agreement, which Kaspers signed when he initially

obtained service, contains a binding arbitration provision. After attempting to

resolve his dispute with Comcast informally, Kaspers submitted a claim to the

American Arbitration Association (“AAA”) in November 2010, in accordance with

the arbitration provision. But the AAA refused to arbitrate the claim because

Comcast’s arbitration provision had a “material or substantial deviation” from

AAA rules and protocol with respect to a clause limiting Comcast’s liability for

certain damages, and because Comcast did not remedy the deviation upon request.

AAA also requested that Comcast remove AAA’s name from the list of arbitrators

in the arbitration clause, but Comcast did not do so. Indeed, it does not appear that

Comcast responded in any way to AAA or Kaspers regarding Kaspers’s attempt to

arbitrate his dispute.

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                                         II.

      Following the unsuccessful attempt to arbitrate, Kaspers filed suit against

Comcast in Georgia state court.      In an amended complaint, Kaspers alleged

numerous claims under Georgia state law on behalf of himself and “all other

customers of Comcast similarly situated.” In broad terms, Kaspers sought to

recover for property damage and for payments he made for service he did not

receive, and he also sought declaratory and injunctive relief either invalidating the

arbitration provision in Comcast’s subscriber agreement or requiring Comcast to

change it in certain ways (such as removing AAA from the list of arbitrators).

      Comcast removed the action to the United States District Court for the

Northern District of Georgia under the Class Action Fairness Act, see 28 U.S.C.

§ 1332(d), and then moved to compel arbitration of Kaspers’s individual claims

and stay the action pending arbitration. Kaspers opposed arbitration for several

reasons, including that Comcast previously had refused to engage in arbitration and

that the arbitration provision was invalid and unenforceable.

      The district court granted Comcast’s motion and compelled arbitration. The

court concluded that the arbitration provision was valid and enforceable and that it

applied to his individual claims against Comcast.        The court also found that

Kaspers’s claims brought on behalf of a proposed class could not proceed to

arbitration due to the following class-action waiver in the subscriber agreement:

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             ALL PARTIES TO THE ARBITRATION MUST BE
             INDIVIDUALLY NAMED. THERE SHALL BE NO
             RIGHT OR AUTHORITY FOR ANY CLAIMS TO BE
             ARBITRATED OR LITIGATED ON A CLASS
             ACTION OR CONSOLIDATED ACTION BASIS OR
             ON BASES INVOLVING CLAIMS BROUGHT IN A
             PURPORTED REPRESENTATIVE CAPACITY ON
             BEHALF OF THE GENERAL PUBLIC (SUCH AS A
             PRIVATE   ATTORNEY     GENERAL), OTHER
             SUBSCRIBERS, OR OTHER PERSONS[.]

Doc. 14–1 at 53-54. Consequently, the court ordered Kaspers’s individual claims

to arbitration and stayed the action.

      In July 2014, the arbitrator issued an award finding in Kaspers’s favor on his

claims for breach of contract and property damage.          The arbitrator awarded

Kaspers $983.52 for amounts paid to Comcast for incomplete or inadequate

services, $250.00 for property damage, and $200.00 for the administrative fee

Kaspers previously paid for the arbitration. After the award, which Comcast paid

in full, Kaspers sought to reopen the district court proceedings—administratively

closed in the interim—to proceed on his class claims. The district court denied the

motion, concluding that the class-action waiver barred him from litigating those

claims. Because Kaspers’s individual claims had been resolved in arbitration, the

court dismissed the action with prejudice. Kaspers now appeals.

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                                          III.

      We review de novo a district court’s order compelling arbitration and

dismissing the action. Cruz v. Cingular Wireless, LLC, 648 F.3d 1205, 1210 (11th

Cir. 2011).

                                          IV.

      “The principal purpose of the [Federal Arbitration Act (FAA)] is to ensure

private arbitration agreements are enforced according to their terms.”            AT&T

Mobility LLC v. Concepcion, 563 U.S. 333, 131 S. Ct. 1740, 1748 (2011) (internal

quotation marks omitted). Through arbitration agreements, “parties may agree to

limit the issues subject to arbitration, to arbitrate according to specific rules, and to

limit with whom a party will arbitrate its dispute.” Id. at 1748-49 (citations

omitted). Thus, parties may agree to class-action waivers. See id.

      Written agreements to arbitrate are “valid, irrevocable, and enforceable, save

upon such grounds as exist at law or in equity for the revocation of any contract.”

9 U.S.C. § 2; Cruz, 648 F.3d at 1210. Therefore, generally applicable contract

defenses, such as fraud, duress, or unconscionability, may be applied to invalidate

arbitration agreements.     Cruz, 648 F.3d at 1210.        However, an agreement to

arbitrate cannot be invalidated “by defenses that apply only to arbitration or that

derive their meaning from the fact that an agreement to arbitrate is at issue.”

Concepcion, 131 S. Ct. at 1746.

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      Kaspers admits that the binding arbitration provision in the subscriber

agreement appears to be valid on its face. Through it, Kaspers and Comcast agreed

to resolve various disputes in arbitration.     Kaspers does not dispute that the

arbitration provision covers his individual claims against Comcast, nor does he

directly challenge the arbitrator’s award. Kaspers likewise does not dispute that, in

the arbitration provision, he waived his rights to proceed against Comcast on a

class basis. In other words, Kaspers does not contend that the district court failed

to enforce the arbitration agreement according to its terms.

      Instead, Kaspers contends, the arbitration provision “as applied” by Comcast

is unconscionable and violates public policy because it is “ineffective and poses

unreasonable hurdles” to resolving disputes through arbitration. In support of that

argument, Kaspers points to evidence of the following:             AAA’s refusal to

administer any disputes brought by Comcast customers, because Comcast’s

arbitration provision does not comply with its due-process protocol; Kaspers’s own

arduous experience in interacting with and attempting to arbitrate a dispute with

Comcast; and the class-action waiver. In light of these and other factors, Kaspers

asserts, the arbitration provision is substantively unconscionable.

      Under    Georgia    law,   unconscionability    is   determined      “under   the

circumstances existing at the time of the making of the contract.” Dale v. Comcast

Corp., 498 F.3d 1216, 1219 (11th Cir. 2007) (internal quotation marks omitted).

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Unconscionability can be either procedural or substantive.          Id.   Procedural

unconscionability concerns the process of making a contract (largely focusing on

the parties and their relative bargaining power), whereas the inquiry into

substantive unconscionability focuses on the contractual terms themselves. Id.

Matters relevant to substantive unconscionability include “the commercial

reasonableness of the contract terms, the purpose and effect of the terms, the

allocation of the risks between the parties, and similar public policy concerns.” Id.

(quotation marks omitted).

      Here, the district court did not err in compelling arbitration and dismissing

Kaspers’s class claims in accordance with the terms of the arbitration provision in

the subscriber agreement. Cruz, 648 F.3d at 1210. Kaspers admits that the terms

of the arbitration provision, including the class-action waiver, are facially valid.

And he provides no legal authority indicating that his theory of unconscionability

“as applied” is a generally applicable contract defense, nor is this novel theory

equivalent to the doctrine of substantive unconscionability, as he claims in his

reply brief. Consequently, he has not shown a basis for invalidating the arbitration

provision. See id.

      While the inquiry into substantive unconscionability looks to the purpose

and effect of the contractual terms, and in that sense looks at how the contractual

terms would be applied, the analysis is still tied to the “contractual terms

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themselves” under the circumstances existing when the contract was made. See

Dale, 498 F.3d at 1219.

       Kaspers points to numerous instances of Comcast’s allegedly unreasonable

and fraudulent actions in making it extraordinarily difficult for parties to resolve or

arbitrate their disputes with Comcast. 2 But however unreasonable these actions

may be, Kaspers does not contend that they arise from the contractual terms

themselves. In fact, they appear to be in opposition to the terms. Moreover, a

party’s resistance to arbitration alone cannot be the basis for invalidating an

arbitration agreement.       Both the FAA and Georgia law provide that a party

aggrieved by the failure of another to arbitrate under an agreement may apply for

an order compelling arbitration in a court of competent jurisdiction. O.C.G.A. § 9–

9–6(a); 9 U.S.C. § 4. Kaspers did not avail himself of this remedy. In sum, the

practical difficulties Kaspers faced in attempting to arbitrate his dispute with

Comcast do not show that there was any defect in the formation of the arbitration

provision or that the contract terms themselves were substantively unconscionable.

       We are likewise unpersuaded that AAA’s refusal to arbitrate claims from

Comcast because of a non-compliant damages provision renders the arbitration

       2
         Although Kaspers makes several references to “fraud” in his briefing on appeal, we take
these statements as mere colorful language and do not understand him to be alleging that the
subscriber agreement was invalid due to the contract defense of fraud. In any case, we would
find such a contention to be abandoned because he makes no legal argument in that respect. See
Sapuppo v. Allstate Floridian Ins. Co., 739 F.3d 678, 681-82 (11th Cir. 2014).
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provision invalid or unenforceable.3 Kaspers agrees with Comcast that AAA’s

administrative determination is not binding on this Court, and he does not

complain that application of the damages provision affected his recovery in this

case. Moreover, AAA’s refusal to arbitrate claims from Comcast does not render

the arbitration provision invalid, because the choice of AAA as a forum was not

integral to the agreement. See Brown v. ITT Consumer Fin. Corp., 211 F.3d 1217,

1222 (11th Cir. 2000); see also 9 U.S.C. § 5 (establishing procedures for the

appointment of a substitute arbitrator). In the arbitration provision, Kaspers agreed

to certain procedures for the appointment of a substitute arbitrator, including

where, as here, the named arbitrator would not enforce the arbitration provision as

written.

       Kaspers also has not shown that the class-action waiver is invalid. His

arguments in this regard are not clear, but he appears to contend that the class-

action waiver, combined with other Comcast practices already mentioned,

effectively precludes subscribers from obtaining relief from Comcast. However,

the Supreme Court has specifically “rejected the argument that class arbitration

was necessary to prosecute claims that might otherwise slip through the legal

system.” Am. Express Co. v. Italian Colors Restaurant, 133 S. Ct. 2304, 2312

(2012).    So to the extent Kaspers argues “that the arbitration agreement [is]

       3
         Ultimately, the AAA agreed to arbitrate this dispute because it had been presented with
a court order to do so.
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unconscionable and unlawfully exculpatory under [state] law because it disallow[s]

classwide procedures,” that argument is foreclosed. Pendergast v. Sprint Nextel

Corp., 691 F.3d 1224, 1235-36 (11th Cir. 2012) (quoting Concepcion, 131 S. Ct. at

1745); see also Cruz, 648 F.3d at 1215. To the extent that Kaspers’s challenge to

the class-action waiver simply relates to the practical difficulty of pursuing

arbitration with Comcast, we reject it for the same reasons stated above.

      Finally, we reject Kaspers’s remaining arguments. Kaspers’s contention that

the district court erroneously found that he lacked “standing” to pursue his class

claims misunderstands the court’s order.        The court made no ruling about

Kaspers’s standing but instead found that these claims were barred by the class-

action waiver.

      And, because we have concluded that the class-action waiver was valid, the

district court did not need to consider the requirements for class certification under

Rule 23, Fed. R. Civ. P. Kaspers also claims that Comcast engaged in “legal

gamesmanship” by removing the action under the Class Action Fairness Act while

at the same time contesting whether Kaspers could pursue his class claims.

However, he does not contend that the action did not meet the formal requirements

of the Class Action Fairness Act at the time of removal or that the court lacked

subject-matter jurisdiction to address and dismiss his claims. Cf. Vega v. T-Mobile

USA, Inc., 564 F.3d 1256, 1268 n.12 (11th Cir. 2009) (concluding that the post-

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removal failure of a proposed class does not deprive the district court of subject-

matter jurisdiction so long as the requirements of the Class Action Fairness Act

were satisfied at the time of removal). Consequently, he has not shown a basis for

reversing the district court’s decision on the basis of Comcast’s “gamesmanship.”

                                          V.

      In sum, Kaspers has not shown that the arbitration provision is invalid and

unenforceable, and the district court did not err in enforcing the arbitration

provision according to its terms by compelling arbitration and dismissing

Kaspers’s class claims. See Concepcion, 131 S. Ct. at 1748; Pendergast, 691 F.3d

at 1236. Therefore, we affirm.

      AFFIRMED.

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