Court Opinion

ID: 3163476
Source: CourtListenerOpinion
Date Created: 2015-12-17 14:00:55.722557+00
Date Added: 2024-06-11T12:02:00.437324
License: Public Domain

Case: 15-11869      Date Filed: 12/17/2015   Page: 1 of 7

                                                           [DO NOT PUBLISH]

                IN THE UNITED STATES COURT OF APPEALS

                         FOR THE ELEVENTH CIRCUIT
                           ________________________

                                 No. 15-11869
                             Non-Argument Calendar
                           ________________________

                       D.C. Docket No. 1:14-cv-22069-DPG

ROBERT A. SCHREIBER,
individually and on behalf of
all others similarly situated,

                                                   Plaintiff - Appellant,

versus

ALLY FINANCIAL INC.,
a Delaware corporation
d.b.a. Ally Bank,
f.k.a. GMAC, Inc.,

                                                   Defendant - Appellee.

                           ________________________

                   Appeal from the United States District Court
                       for the Southern District of Florida
                         ________________________

                                 (December 17, 2015)
                Case: 15-11869        Date Filed: 12/17/2015       Page: 2 of 7

Before HULL, MARCUS, and EDMONDSON, Circuit Judges.

PER CURIAM:

       This appeal is controlled by state law. Robert Schreiber appeals the district

court’s order compelling arbitration of Schreiber’s claims against Ally Financial,

Inc. (“Ally”) for violation of the Consumer Leasing Act (“CLA”), 15 U.S.C. §

1667 et. seq., and for breach of contract. Reversible error has been shown; we

vacate the district court’s order and remand for further proceedings.

       Schreiber and Ally are parties to a vehicle lease agreement (“Lease

Agreement”).1 The Lease Agreement includes a provision, titled “Purchase Option

at End of Lease Term,” giving Schreiber the option to buy the leased car at the end

of the lease term for “$25,899.70, plus official fees and taxes.”

       Near the end of the lease term, Schreiber sought to exercise the Lease

Agreement’s purchase option; but Ally refused to sell Schreiber the car. Instead,

Ally directed Schreiber to buy the car through Miami Lakes CJ, LLC (“Miami

Lakes”). Ally was aware that Miami Lakes would charge Schreiber additional fees

that had not been disclosed in the Lease Agreement.

1
 The Lease Agreement was originally entered into between Wesley Reid and Miami Lakes CJ,
LLC. Under the Lease Agreement, Miami Lakes agreed to “assign this lease and sell the vehicle
to Ally Bank.” Reid also later assigned his rights and interest in the Lease Agreement to
Schreiber. Thus, for purposes of this appeal, Schreiber and Ally are the only parties to the Lease
Agreement.
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      Unable to buy the car from Ally, Schreiber entered into a purchase

agreement with Miami Lakes, dated March 2014 (“Buyer’s Order”). The total

purchase price for the car -- which included undisclosed pre-delivery service and

documentation fees -- was about $400 more than the agreed-upon purchase price in

the Lease Agreement’s purchase option. The Buyer’s Order included an

Arbitration Clause, requiring arbitration of all claims arising out of the Buyer’s

Order.

      Schreiber filed this putative class action against Ally. The district court

granted Ally’s motion to compel arbitration of Schreiber’s claims pursuant to the

Arbitration Clause. The district court concluded that, although Ally was no party

to the Buyer’s Order, Ally was entitled to enforce the Arbitration Clause on

grounds of equitable estoppel.

      “We review de novo a district court order granting a motion to compel

arbitration.” In re Checking Account Overdraft Litig., 754 F.3d 1290, 1293 (11th

Cir. 2014). We look to state law to determine “whether a non-party can enforce an

arbitration clause against a party.” Lawson v. Life of the South Ins. Co., 648 F.3d
1166, 1170-71 (11th Cir. 2011). The parties agree that Florida law governs this

dispute.

      Generally speaking, under Florida law, “a non-signatory to a contract

containing an arbitration clause cannot compel a signatory to submit to

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arbitration.” Allscripts Healthcare Sols., Inc. v. Pain Clinic of Nw. Fla., 158 So. 3d
644, 646 (Fla. Dist. Ct. App. 2014). Florida courts have recognized exceptions to

this general rule, including the doctrine of equitable estoppel. Id. Under equitable

estoppel, a non-signatory defendant may enforce an arbitration clause against a

signatory plaintiff in two circumstances: (1) when the signatory to a contract

containing an arbitration clause must rely on the terms of the contract to assert his

claims against the non-signatory; and (2) when the signatory alleges

“interdependent and concerted misconduct by both the nonsignatory and one or

more of the signatories to the contract.” Id.; Bailey v. ERG Enter., LP, 705 F.3d
1311, 1320 (11th Cir. 2013). Whether equitable estoppel applies is a fact-specific

inquiry. Bailey, 705 F.3d at 1322.

      For purposes of the first exception, “[a] party relies on the terms of a

contract when the party needs the underlying contract to make out his or her claim

against the nonsignatory.” Id. at 1321. “The signatory must attempt to hold the

nonsignatory to the terms of the contract.” Id. A mere but-for relationship

between plaintiff’s claims and the contract is insufficient to warrant equitable

estoppel. Id. at 1321-22.

      “The idea behind the first exception is that a signatory plaintiff should not be

allowed to sue to essentially enforce its rights under a contract and, at the same

time, evade an arbitration agreement in the contract, simply by naming as

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defendants parties who were not signatories to the contract.” Allscripts Healthcare

Sols., Inc., 158 So. 3d at 646. “The plaintiff’s actual dependence on the underlying

contract in making out the claim against the non-signatory defendant is therefore

always the sine qua non of an appropriate situation for applying equitable

estoppel.” Id.

      Under the facts of this case, Schreiber’s claims do not “rely on” the terms of

the Buyer’s Order. Schreiber is not seeking to enforce his rights under the Buyer’s

Order. Schreiber seeks, instead, to hold Ally to the terms of purchase option in the

Lease Agreement.

      We reject Ally’s contention that Schreiber’s claims “rely on” the Buyer’s

Order merely because the Buyer’s Order contains the final purchase price of the

car. Ally flat refused to sell the car to Schreiber. Although the final purchase price

from Miami Lakes is pertinent to determining the amount of Schreiber’s actual

damages, it is no necessary element of Schreiber’s CLA or breach-of-contract

claims. See 15 U.S.C. § 1640 (providing for statutory damages for violations of

the CLA); AMC/Jeep of Vero Beach v. Funston, 403 So. 2d 602, 605 (Fla. Dist.

Ct. App. 1981) (under Florida law, “a cause of action exists for every breach of

contract” such that a plaintiff who has suffered no damage is still entitled to

nominal damages). And the final amount that Schreiber paid Miami Lakes for the

car may be proved without reference to the Buyer’s Order.

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       Moreover, Schreiber’s claims, as alleged,2 accrued when Ally refused to sell

the car to Schreiber. That Ally’s alleged misconduct occurred before Schreiber

entered into the Buyer’s Order with Miami Lakes supports a conclusion that

Schreiber’s claims rely on no terms of the Buyer’s Order. See Bailey, 705 F.3d at

1322-23 (“It would be rather puzzling to say that [Buyers’] fraud claims rely on the

lot purchase contracts when the alleged fraud occurred before any of the Buyers

purchased their lots.”).

       Ally has also failed to demonstrate that equitable estoppel is warranted under

the second exception. We have said that the second exception is not implicated

when a plaintiff alleges no interdependent and concerted misconduct between a

signatory and a non-signatory to the contract and when the plaintiff names no

signatory as a defendant. See Bailey, 705 F.3d at 1321.

       In his complaint, Schreiber contends only that “Ally directed Plaintiff to

purchase the vehicle through Miami Lakes.” Schreiber alleges no conspiracy

between Ally and Miami Lakes. Nor does Schreiber allege that Miami Lakes itself

engaged in misconduct. Thus, Schreiber has alleged no interdependent and

concerted misconduct between Ally and Miami Lakes. Compare, e.g., MS Dealer

2
 The only issue before us on appeal is whether Schreiber may be compelled to arbitrate his
claims against Ally. For purposes of our analysis, we consider Schreiber’s claims as alleged in
his complaint, recognizing that “[t]he plaintiff is the master of the complaint” and “selects the
claims that will be alleged in the complaint.” See United States v. Jones, 125 F.3d 1418, 1428
(11th Cir. 1997). We express no opinion about -- and the district court made no ruling on --
whether Schreiber’s complaint states a claim for relief or about the underlying merits of
Schreiber’s claims. Those issues are issues that can be decided on remand.
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Serv. Corp. v. Franklin, 177 F.3d 942, 948 (11th Cir. 1999) (plaintiff alleged

“substantially interdependent and concerted misconduct” when she alleged that a

non-signatory conspired with a signatory to engage in a fraudulent scheme), with

Rolls-Royce PLC v. Royal Caribbean Cruises, Ltd., 960 So. 2d 768, 771 (Fla. Dist.

Ct. App. 2007) (plaintiff alleged no “concerted action” where the allegations in the

complaint pointed only to acts of the non-signatory). As a result -- and because

Miami Lakes is no named defendant -- Ally has failed to satisfy the second

exception warranting equitable estoppel.

      Under Florida law, Ally is precluded from compelling Schreiber to submit to

arbitration. See Allscripts Healthcare Sols., Inc., 158 So. 3d at 646. We vacate the

district court’s order compelling arbitration and remand the case for further

proceedings.

      VACATED AND REMANDED.

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