Court Opinion

ID: 6496619
Source: CourtListenerOpinion
Date Created: 2022-06-30 00:00:41.897625+00
Date Added: 2024-06-11T08:50:02.722645
License: Public Domain

Case: 21-60799      Document: 00516376016         Page: 1    Date Filed: 06/29/2022

           United States Court of Appeals
                for the Fifth Circuit                                  United States Court of Appeals
                                                                                Fifth Circuit

                                                                              FILED
                                   No. 21-60799                           June 29, 2022
                                                                         Lyle W. Cayce
                                                                              Clerk
   Michelle Barnett,

                                                             Plaintiff—Appellee,

                                       versus

   American Express National Bank,

                                                          Defendant—Appellant.

                  Appeal from the United States District Court
                    for the Southern District of Mississippi
                            USDC No. 3:20-CV-623

   Before Higginbotham, Haynes, and Wilson, Circuit Judges.
   Per Curiam:
          American Express National Bank (“AmEx”) filed suit for breach of
   contract in Mississippi state court to recover $2,855.74 of unpaid credit card
   debt incurred on Michelle Barnett’s account. Barnett contends an unknown
   person incurred this debt fraudulently. Barnett then filed Fair Credit
   Reporting Act (“FCRA”) claims against AmEx and other defendants in
   Mississippi state court. After removal to the Southern District of Mississippi,
   AmEx moved to compel arbitration of the FCRA claims, which the district
   court denied. Applying this Court’s test for waiver of the right to compel
Case: 21-60799           Document: 00516376016               Page: 2     Date Filed: 06/29/2022

                                              No. 21-60799

   arbitration, 1 the district court held that AmEx substantially invoked the
   judicial process by filing the breach of contract lawsuit where “the validity of
   the disputed indebtedness [is a] married feature[] to” AmEx’s breach of
   contract claim and Barnett’s FCRA claims. The district court also found
   resulting prejudice to Barnett, leading it to deny AmEx’s motion to compel
   arbitration.
          On the same day and after the district court’s ruling, two cases of
   relevance to this dispute were decided. In Forby v. One Techs., L.P., this Court
   clarified the test for waiver by a party of the right to compel arbitration and
   reiterated that waiver analysis occurs on a claim-by-claim basis.2 In addition
   to Forby, the Supreme Court decided Morgan v. Sundance, Inc. while the
   appeal in this case was pending. 3 Morgan addressed this and eight of our sister
   circuits’ tests for waiver by a party of the right to compel arbitration. 4 While
   we can apply subsequent precedent to cases before us, “[a]s a court for
   review of errors, we are not to decide facts or make legal conclusions in the
   first instance. Our task is to review the actions of a trial court for claimed
   errors.” 5 As the able district court did not have the benefit of these two
   decisions, we VACATE the decision of the district court and REMAND for
   reconsideration in the first instance in light of Morgan and Forby.

          1
              Miller Brewing Co. v. Fort Worth Distrib. Co., 781 F.2d 494, 497 (5th Cir. 1986).
          2
              Forby v. One Techs., L.P., 13 F.4th 460, 462 (5th Cir. 2021).
          3
              Morgan v. Sundance, Inc., 596 U.S. ––––, 142 S. Ct. 1708 (May 23, 2022).
          4
              Id., 142 S. Ct. at 1712, n.1.
          5
              Browning v. Kramer, 931 F.2d 340, 345 (5th Cir. 1991).

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