Court Opinion

ID: 3053849
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:50:38.842378+00
Date Added: 2024-06-11T12:44:59.180404
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

LAURA HOFFMAN, an individual, on        
behalf of herself and all others
                                              No. 07-55616
similarly situated,
                 Plaintiff-Appellant,
                                               D.C. No.
                                            CV-06-00571-AJG
                  v.
                                               OPINION
CITIBANK (SOUTH DAKOTA), N.A.,
                Defendant-Appellee.
                                        
        Appeal from the United States District Court
           for the Central District of California
        Andrew J. Guilford, District Judge, Presiding

                   Argued and Submitted
             June 9, 2008—Pasadena, California

                   Filed October 14, 2008

       Before: Stephen Trott, Sydney R. Thomas and
            Raymond C. Fisher, Circuit Judges.

                    Per Curiam Opinion;
                 Concurrence by Judge Trott

                            14485
14488                HOFFMAN v. CITIBANK

                         COUNSEL

Barry L. Kramer, Law Offices of Barry L. Kramer, Los Ange-
les, California, and Gretchen A. Carpenter, Strange & Carpen-
ter, Los Angeles, California, for the plaintiff-appellant.

Julia B. Strickland, Stroock & Stroock & Lavan LLP, Los
Angeles, California, for the defendant-appellee.

                         OPINION

PER CURIAM:

   Plaintiff-Appellant Laura Hoffman (“Hoffman”) appeals
the district court’s order compelling arbitration in her class
action suit against her credit card company, Defendant-
Appellee Citibank (South Dakota) N.A. (“Citibank”). The dis-
trict court found that Hoffman was party to an arbitration
agreement that waived her right to proceed on a class basis.
Applying South Dakota law — the law chosen in the credit
card agreement — the district court enforced the class arbitra-
tion waiver and ordered Hoffman to proceed on a non-class
basis. Nonetheless, the district court found substantial
grounds for a difference of opinion regarding a controlling
                     HOFFMAN v. CITIBANK                  14489
issue of law, “whether California law or South Dakota law
should be used to determine the enforceability of the arbitra-
tion agreement,” and issued an order for immediate appeal.
The case was stayed without completion of discovery. We
granted permission for the appeal, and we have jurisdiction
under 28 U.S.C. § 1292(b). Because we are persuaded that the
district court’s order compelling arbitration erroneously relied
on cases that do not properly apply California choice of law
rules, we remand for a determination of whether California or
South Dakota law applies to the class arbitration waiver.

          FACTUAL AND PROCEDURAL BACKGROUND

   In 1994, Hoffman opened a credit card account with Citi-
bank subject to a written credit card agreement. The card
agreement contained a choice of law provision stating that
“[t]he terms and enforcement of this Agreement shall be gov-
erned by South Dakota and federal law.” The agreement per-
mitted Citibank to change its terms by mailing Hoffman
written notification of the change at least 15 days before the
effective billing cycle. Upon receiving notice, Hoffman was
provided 25 days to reject the changes in writing. Silence or
using the card was deemed acceptance of the changes in
accordance with South Dakota Codified Laws § 54-11-10.

   Approximately seven years later, following the procedures
set forth in § 54-11-10, Citibank mailed Hoffman a “Notice of
Change in Terms Regarding Binding Arbitration to Your Citi-
bank Card Agreement.” The added arbitration provision
stated, in pertinent part:

    ARBITRATION:

    PLEASE READ THIS PROVISION OF THE
    AGREEMENT CAREFULLY. IT PROVIDES
    THAT ANY DISPUTE MAY BE RESOLVED
    BY BINDING ARBITRATION. ARBITRATION
    REPLACES THE RIGHT TO GO TO COURT,
14490                HOFFMAN v. CITIBANK
    INCLUDING THE RIGHT TO A JURY AND
    THE RIGHT TO PARTICIPATE IN A CLASS
    ACTION OR SIMILAR PROCEEDING. IN
    ARBITRATION, A DISPUTE IS RESOLVED
    BY AN ARBITRATOR INSTEAD OF A JUDGE
    OR JURY. ARBITRATION PROCEDURES
    ARE SIMPLER AND MORE LIMITED THAN
    COURT PROCEDURES.

    Agreement to Arbitrate:

    Either you or we may, without the other’s consent,
    elect mandatory, binding arbitration for any claim,
    dispute, or controversy between you and us (called
    “Claims”).

    Claims Covered:

    • What Claims are subject to arbitration? . . .
    Claims and remedies sought as part of a class action,
    private attorney general or other representative
    action are subject to arbitration on an individual
    (non-class, non-representative) basis, and the arbitra-
    tor may award relief only on an individual (non-
    class, non-representative) basis.

                          *   *   *

    • Broadest Interpretation. Any questions about
    whether Claims are subject to arbitration shall be
    resolved by interpreting this arbitration provision in
    the broadest way the law will allow it to be enforced.
    This arbitration provision is governed by the Federal
    Arbitration Act (the “FAA”).

                          *   *   *

    • Who can be a party? Claims must be brought in
    the name of an individual person or entity and must
                     HOFFMAN v. CITIBANK                 14491
    proceed on an individual (non-class, non-
    representative) basis. The arbitrator will not award
    relief for or against anyone who is not a party. If you
    or we require arbitration of a Claim, neither you, we,
    nor any other person may pursue the Claim in arbi-
    tration as a class action, private attorney general
    action or other representative action, nor may such
    Claim be pursued on your or our behalf in any litiga-
    tion in any court. Claims, including assigned Claims,
    of two or more persons may not be joined or consoli-
    dated in the same arbitration.

The arbitration provision also included terms giving the card-
member the option to sue in small claims court and requiring
Citibank to reimburse or advance arbitration fees under cer-
tain circumstances.

  Citibank printed the following message on Hoffman’s
October 2001 statement alerting her to the enclosed notice:

    PLEASE SEE THE ENCLOSED CHANGE IN
    TERMS NOTICE FOR IMPORTANT INFORMA-
    TION ABOUT THE BINDING ARBITRATION
    PROVISION WE ARE ADDING TO YOUR CITI-
    BANK CARD AGREEMENT.

The change in terms provided that the arbitration provision
would become effective on the day after the closing date
appearing on Hoffman’s November 2001 billing statement.
Hoffman’s November 2001 statement included a reminder
advising her to call Citibank if she wanted another copy of the
arbitration provision.

  The change in terms expressly gave Hoffman “Non-
Acceptance Instructions”:

    If you do not wish to accept the binding arbitration
    provision contained in this change in terms notice,
14492                    HOFFMAN v. CITIBANK
      you must notify us in writing within 26 days after the
      Statement/Closing date indicated on your November
      2001 billing statement stating your non acceptance.
      . . . If you notify us by that time that you do not
      accept the binding arbitration provisions contained in
      this change in terms notice, you can continue to use
      your card(s) under your existing terms until the end
      of your current membership year or the expiration
      date on your card(s), whichever is later. At that time
      your account will be closed and you will be able to
      pay off your remaining balance under your existing
      terms.

(Emphasis added.) Hoffman did not notify Citibank of her
non-acceptance and continued to use her account by making
additional charges and payments. Had she notified Citibank of
her non-acceptance, it appears that her relationship with Citi-
bank would have continued without change for the duration
of the agreement.

   Hoffman brought this consumer action in California state
court against Citibank on behalf of herself and other similarly
situated California cardholders. Hoffman alleged that Citi-
bank increased the class members’ interest rates retroactively,
without advance notice, resulting in additional lump sum
finance charges being improperly imposed. The suit was ini-
tially brought in California state court but was removed to
federal court by Citibank. The operative pleading, the First
Amended Complaint, alleges a violation of the Unfair Com-
petition Law, California Business & Professions Code
§§ 17200, et seq.1
  1
   The initial pleading alleged a violation of California’s Consumer Legal
Remedies Act, California Civil Code §§ 17500, et seq. (“CLRA”). Hoff-
man indicates she will not pursue her CLRA claim on remand, and does
not base this appeal on her CLRA pleadings in the light of Berry v. Am.
Express Publ’g, Inc., 54 Cal. Rptr. 3d 91, 92 (Cal. Ct. App. 2007) (holding
that the CLRA does not apply to credit card transactions).
                     HOFFMAN v. CITIBANK                  14493
  Before filing an answer, Citibank filed a motion to compel
arbitration and stay proceedings. The district court issued an
order granting Citibank’s motion to compel arbitration of
Hoffman’s claims on an individual, non-class basis.

   In that order, the district court found that Hoffman was
party to an arbitration agreement that was subject to a choice
of law provision favoring South Dakota law. The district court
then concluded without further analysis that the choice of law
provision was enforceable, and thus South Dakota law gov-
erned the agreement. Applying South Dakota law, the district
court concluded that the class arbitration waiver was not
unconscionable and was enforceable.

   Hoffman subsequently moved to certify the district court’s
order compelling arbitration for immediate appeal. The dis-
trict court granted Hoffman’s motion, finding that the choice
of law issue presented substantial grounds for difference of
opinion and was a controlling question of law, the appeal of
which would materially advance the litigation. We granted
Hoffman’s petition for permission to be heard.

        STANDARD OF REVIEW AND BURDEN OF PROOF

   We review de novo a district court’s order compelling arbi-
tration. See Davis v. O’Melveny & Myers, 485 F.3d 1066,
1072 (9th Cir. 2007). An arbitration agreement governed by
the Federal Arbitration Act is presumed to be valid and
enforceable. See Shearson/Am. Exp., Inc. v. McMahon, 482
U.S. 220, 226-27 (1987). The applicable state law controls
whether an arbitration agreement is unconscionable and,
therefore, unenforceable. See Doctor’s Assocs., Inc. v. Casa-
rotto, 517 U.S. 681, 686-87 (1996). “[T]he party resisting
arbitration bears the burden of proving that the claims at issue
are unsuitable for arbitration.” Green Tree Fin. Corp.-Ala. v.
Randolph, 531 U.S. 79, 91 (2000).
14494                 HOFFMAN v. CITIBANK
                           DISCUSSION

                 I.   The Need for Remand

    [1] Federal courts sitting in diversity look to the law of the
forum state when making choice of law determinations. See
Fields v. Legacy Health Sys., 413 F.3d 943, 950 (9th Cir.
2005). In this case, Hoffman sued in California. When an
agreement contains a choice of law provision, California
courts apply the parties’ choice of law unless the analytical
approach articulated in § 187(2) of the Restatement (Second)
of Conflict of Laws (“§ 187(2)”) dictates a different result.
See Discover Bank v. Superior Court, 113 P.3d 1100, 1117
(Cal. 2005). The California Supreme Court has held that
under California’s choice of law analysis, a court must deter-
mine as a threshold matter “whether the chosen state has a
substantial relationship to the parties or their transaction, or
. . . whether there is any other reasonable basis for the parties’
choice of law.” Nedlloyd Lines B.V. v. Superior Court, 834
P.2d 1148, 1152 (Cal. 1992). If either of these tests is satis-
fied, the second inquiry is whether the “chosen state’s law is
contrary to a fundamental policy of California.” Id. If such a
conflict with California law is found, “the court must then
determine whether California has a materially greater interest
than the chosen state in the determination of the particular
issue.” Id. (internal quotations marks omitted).

  [2] Here, the district court found that determining which
law applied posed a close call, yet its order did not follow the
requisite California choice of law analysis. Instead, in decid-
ing to apply South Dakota law to determine the enforceability
of the class arbitration waiver, the district court reasoned:

    Two respected judges in this district facing almost
    the same facts have ruled that under Nedlloyd Lines
    B.V. v. Superior Court, 3 Cal. 4th 459 [834 P.2d
1148] (1992), South Dakota law governs any
    enforceability or unconscionability defenses to the
                           HOFFMAN v. CITIBANK                       14495
      arbitration clause. Egerton [v. Citibank, N.A.], 2004
WL 1057739, at *2 [(C.D. Cal. Feb. 18, 2004)];
      Lowman v. Citibank (South Dakota) N.A., CV 05-
      8097 RGK, slip op. at *3 (C.D. Cal. March 24,
      2006).

   [3] To understand the district court’s reasoning, we look to
both Egerton and Lowman. Neither decision properly applied
California’s choice of law rules articulated in § 187(2) and
Nedlloyd, and therefore the district court should not have
exclusively relied on those decisions. The court in Egerton
merely mentioned Nedlloyd in a conclusory statement without
describing its analytical framework before concluding “that
South Dakota law controls enforceability and the uncons-
cionability defense.” Egerton, 2004 WL 1057739, at *2. The
court in Lowman similarly concluded that “pursuant to Ned-
lloyd . . . South Dakota law governs” without providing any
additional choice of law analysis. Lowman, CV 05-8097
RGK, slip op. at 3. Because neither court adequately applied
California’s choice of law analysis, it was error for the district
court to rely exclusively on Egerton and Lowman to conclude
that South Dakota law governs here. Instead, the district court
was required to explicitly apply the analytical approach artic-
ulated in § 187(2) and Nedlloyd to the particular facts of this
case. We remand for that analysis.

                     II.    Analysis on Remand

   [4] Hoffman concedes that South Dakota has a “substantial
relationship” to the instant transaction. Thus, on remand the
district court should focus on the second step of the Nedlloyd
test and specifically address whether the enforceability of this
class arbitration waiver under South Dakota law is contrary to
a fundamental policy of California.2 California has a funda-
  2
    We agree with the district court’s conclusion that Citibank’s class arbi-
tration waiver is not procedurally unconscionable under South Dakota law
and therefore is enforceable if South Dakota law controls. See S. D. CODI-
FIED LAWS § 54-11-10; see also Nygaard v. Sioux Valley Hosp. & Health
Sys., 731 N.W.2d 184, 195 (S.D. 2007) (requiring both substantive and
procedural unconscionability when reviewing a contract).
14496                    HOFFMAN v. CITIBANK
mental policy against unconscionable class arbitration wai-
vers. See Klussman v. Cross Country Bank, 36 Cal. Rptr. 3d
728, 739-40 (Cal. Ct. App. 2005); see also CAL. CIV. CODE
§ 1668.3 The California courts have explained the need for
this policy, reasoning that a defendant could “essentially
grant[ ] itself a license to push the boundaries of good busi-
ness practices to their furthest limits, fully aware that rela-
tively few, if any, customers will seek legal remedies” and
that “[t]he potential for millions of customers to be over-
charged small amounts without an effective method of redress
cannot be ignored.” Klussman, 36 Cal. Rptr. 3d at 739 (inter-
nal quotation marks omitted) (quoting Discover Bank, 113
P.3d at 1108). Thus, if Citibank’s class arbitration waiver is
unconscionable under California law, enforcement of the
waiver under South Dakota law would be contrary to a funda-
mental policy of California.

   Whether a specific class arbitration waiver is unconsciona-
ble under California law turns on

      (1) whether the agreement is a consumer contract of
      adhesion drafted by a party that has superior bargain-
      ing powers; (2) whether the agreement occurs in a
      setting in which disputes between the contracting
      parties predictably involve small amounts of dam-
      ages; and (3) whether it is alleged that the party with
      the superior bargaining power has carried out a
      scheme to deliberately cheat large numbers of con-
      sumers out of individually small sums of money.

Shroyer v. New Cingular Wireless Serv., Inc., 498 F.3d 976,
983 (9th Cir. 2007) (internal quotation marks omitted); see
also Klussman, 36 Cal. Rptr. 3d at 739-40 (citing Discover
  3
   In addition, various district courts in California have followed Kluss-
man’s analysis. See, e.g., Oestreicher v. Alienware Corp., 502 F. Supp. 2d
1061, 1066 (N.D. Cal. 2007); Brazil v. Dell, Inc., No. C-07-01700, 2007
WL 2255296 at *4 (N.D. Cal. Aug. 3, 2007).
                         HOFFMAN v. CITIBANK                       14497
Bank, 113 P.3d at 1110). Although this test has both substan-
tive and procedural elements, these components exist on a
sliding scale such that they need not be present in the same
degree. See Armendariz v. Found. Health Psychcare Serv.,
Inc., 6 P.3d 669, 690 (Cal. 2000). Instead, “even if the evi-
dence of procedural unconscionability is slight, strong evi-
dence of substantive unconscionability will tip the scale and
render the arbitration provision unconscionable.” Nagrampa
v. MailCoups, Inc., 469 F.3d 1257, 1281 (9th Cir. 2006) (en
banc); see also Gatton v. T-Mobile USA, Inc., 61 Cal. Rptr.
3d 344, 356 (Cal. Ct. App. 2007) (“[U]nder Armendariz, we
conclude that courts are not obligated to enforce highly unfair
provisions that undermine important public policies simply
because there is some degree of consumer choice in the mar-
ket.”) (internal citation omitted).

   [5] Citibank’s class arbitration waiver would be substan-
tively unconscionable under California law on the facts
alleged. Hoffman claims that Citibank’s challenged billing
practice resulted in an additional finance charge of approxi-
mately $68, which easily constitutes the requisite “small
amount of damages.” See Oestreicher v. Alienware Corp., 502
F. Supp. 2d 1061, 1067-68 (N.D. Cal. 2007) (finding an
amount of over $4,000 “not substantial”); Cohen v. DirectTV,
Inc., 48 Cal. Rptr. 3d, 813, 820 (Cal. App. 2006) (holding
$1,000 insufficient to warrant individual litigation). Hoff-
man’s allegation that Citibank adopted this practice to ensure
that it could charge a higher interest rate for at least a month
before the affected customers could do anything to avoid
these charges qualifies as a “scheme to deliberately cheat
large numbers of consumers out of individually small sums of
money.” Discover Bank, 113 P.3d at1108; see Cohen, 48 Cal.
Rptr. 3d at 820-21.4
  4
   Citibank argues that Hoffman’s allegations are insufficient to prove
that the class arbitration waiver is unconscionable and therefore the Fed-
eral Arbitration Act requires enforcement of the arbitration agreement.
This argument misunderstands the important, albeit slight, difference
14498                    HOFFMAN v. CITIBANK
   [6] With respect to procedural unconscionability, it is plain
that Citibank was in a superior bargaining position to Hoff-
man and that Citibank’s contract was offered in such a way
that Hoffman was unable to negotiate its terms. These two
elements often render a contract provision oppressive, and
therefore procedurally unconscionable. See Gatton, 61 Cal.
Rptr. 3d at 352-53; Flores v. Transamerica HomeFirst, Inc.,
113 Cal. Rptr. 2d 376, 381-82 (Cal. App. 2001). The disposi-
tive questions that the district court has thus far not addressed,
however, are the practical impacts of Citibank’s “non-
acceptance instructions” and whether, when placed on Cali-
fornia’s sliding scale, the non-acceptance provision renders
the class arbitration waiver conscionable when compared to
the degree of substantive unconscionability. We have held
that providing a “meaningful opportunity to opt out” can pre-
clude a finding of procedural unconscionability and render an
arbitration provision enforceable. See Circuit City Stores, Inc.
v. Ahmed, 283 F.3d 1198, 1199 (9th Cir. 2002). In contrast,
although “bill stuffer” amendments are not per se unconscio-
nable, Discover Bank, 113 P.3d at 159-63, a California court
has held that a “bill stuffer” that includes a class arbitration
waiver provision that the customer is deemed to accept unless
she closes her account is procedurally unconscionable. See
Cohen, 48 Cal. Rptr. 3d at 819-20. Moreover, two district
courts in our circuit have determined that the ability to rescind
a contract within 21 or 30 days does not necessarily insulate
class arbitration waivers within such contracts from proce-
dural unconscionability. See Oestreicher, 502 F.Supp.2d at

between determining that South Dakota’s enforcement of an unconsciona-
ble provision is counter to a fundamental policy of California and actually
finding the provision unconscionable under the substantive law of con-
tract. In the choice of law context, California courts applying Nedlloyd and
Discover Bank require only that “the allegations allege the defendant has
‘carried out a scheme to deliberately cheat large numbers of consumers
out of individually small sums of money.’ ” Klussman, 36 Cal. Rptr. 3d
at 739 (emphasis added) (quoting Discover Bank, 113 P.3d at 1108); see
also Shroyer, 498 F.3d at 983.
                          HOFFMAN v. CITIBANK                         14499
1070; Brazil v. Dell Inc., No. C-07-01700, 2007 WL
2255296, at *8 (N.D. Cal. Aug. 3, 2007). Additionally, this
circuit has “consistently followed the courts that reject the
notion that the existence of ‘marketplace alternatives’ bars a
finding of procedural unconscionability.” Shroyer, 498 F.3d at
985.

   [7] Given this legal landscape, we remand to the district
court so that it may conduct additional fact finding regarding
the nature and scope of Citibank’s “instructions for non-
acceptance” provision to determine whether the waiver pro-
vided enough of a meaningful opportunity to opt out to be
enforceable. Expanding the record with respect to issues such
as how much additional time the expiration date cutoff typi-
cally provides, how many customers exercise their ability to
opt out and whether other banks use similar provisions will
enable the court to determine whether Citibank provided an
“actual, meaningful, and reasonable choice” such that its class
arbitration waiver is not procedurally unconscionable. Circuit
City Stores, Inc. v. Mantor, 335 F.3d 1101, 1106 (9th Cir. 2003).5

                           III.    Conclusion

   We respectfully conclude that the district court erred
because it did not apply California’s choice of law analysis as
articulated in Restatement § 187(2) and Nedlloyd, and more
  5
    Under Nedlloyd, if there is a fundamental conflict with California law,
then the choice of law analysis would turn to whether California has a
materially greater interest than South Dakota in the outcome of this case.
See Nedlloyd, 834 P.2d at 1152. Because the procedural unconscionability
of the class arbitration waiver remains an open question, it is premature
to reach a holding on the materially greater interest prong of this test. Nev-
ertheless, because the district court expressed some confusion on this
issue, we emphasize that the instant case is distinguishable from the two
cited by the district court because it was brought by a California resident,
on behalf of a California-only class, under a California statute for an
allegedly deceptive practice whose injury was felt in California. See
Oestreicher, 502 F. Supp. 2d at 1069; see also Klussman, 36 Cal. Rptr. 3d
at 741.
14500                 HOFFMAN v. CITIBANK
specifically because it did not address whether Citibank’s
class arbitration waiver, accompanied by a non-acceptance
provision, is unconscionable under California law.

  This panel retains jurisdiction over any future appeals.

  REVERSED and REMANDED.

TROTT, Circuit Judge, concurring:

  Given the narrow question presented by this appeal, I con-
cur in our per curiam opinion. Nevertheless, I add some
observations designed, I hope, to shed light on remand on the
underlying question: is the arbitration “agreement” — includ-
ing a class arbitration waiver — enforceable, or not.

   California law is far from settled. In Citibank (South
Dakota), N.A. v. Walker, No. A117770, slip op. at 8 (Cal. Ct.
App. September 11, 2008), Division Four of the First Appel-
late District held in an unpublished opinion that the arbitration
waiver at issue is not unconscionable or unenforceable under
California law. In so holding, that court focused on a card-
holder’s choices:

    Here, although the change was made in a “bill stuff-
    er,” Walker was given an opportunity to opt out of
    arbitration. By opting out of the amendment, Walker
    would have been permitted to use his card until it
    expired, at which time he would have been able to
    pay off his balance under the existing terms. This
    does not present the same take it or leave it scenario
    found to be procedurally unconscionable in Discover
    Bank [v. Superior Court, 113 P.3d 1100 (Cal.
    2005).] Moreover, Discover Bank [v. Superior
    Court] does not stand for the proposition that “bill
    stuffer” amendments are per se unconscionable.
                     HOFFMAN v. CITIBANK                 14501
    Rather, it focuses on the take it or leave it nature of
    the contractual modification.

Walker, No. A117770, slip op. at 10 (citation omitted).

  However, Division Seven of the Second Appellate District
held in Firchow v. Citibank (South Dakota), N.A., No.
B187081, 2007 Cal. App. Unpub. LEXIS 178, at * 26 (Ct.
App. Jan. 10, 2007), that the “agreement” under our legal
microscope is unconscionable.

   This brings us to Jones v. Citigroup, Inc., 38 Cal. Rptr. 3d
461 (Ct. App. 2006). In Jones, Division Three of the Fourth
Appellate District declined to conclude that a similar attempt
to avoid classwide arbitration was unconscionable under Cali-
fornia law:

       Our case is different [from Discover Bank v. Supe-
    rior Court]. Here, although the change was made in
    a “bill stuffer,” plaintiffs were given an opportunity
    to opt out of arbitration. By giving written notice of
    their rejection of the amendment, they could con-
    tinue to use their cards until the cards expired and
    then would be able to pay off their balances under
    the terms of their existing agreement without accel-
    eration. This does not present the take it or leave it
    scenario described in Discover [Bank v. Superior
    Court] or Szetela [v. Discover Bank, 118 Cal. Rptr.
2d 862 (Ct. App. 2002),] as being procedurally
    unconscionable. Rather, it appears that defendant
    was cognizant of the oppressive nature of forcing a
    nonconsenting cardholder to either agree to arbitra-
    tion or immediately cancel the account and took
    steps to avoid it.

Jones, 38 Cal. Rptr. 3d at 465.

   The good news, if there is any good news in all of this, is
that the California Supreme Court vacated and remanded the
14502                 HOFFMAN v. CITIBANK
Jones decision for further proceedings in light of its decision
in Gentry v. Superior Court, 165 P.3d 556 (Cal. 2007). Jones
v. Citigroup, Inc., 171 P.3d 547 (Cal. 2007).

   There it is. Mixed signals from the California courts. One
hopes on remand in this case that the legal dust will soon set-
tle and that our district court will have some reliable authority
upon which to base its decision.