Court Opinion

ID: 4206363
Source: CourtListenerOpinion
Date Created: 2017-09-26 19:01:15.72877+00
Date Added: 2024-06-11T14:40:45.005542
License: Public Domain

Case: 15-10779     Date Filed: 09/26/2017   Page: 1 of 55

                                                                          [PUBLISH]

                IN THE UNITED STATES COURT OF APPEALS

                         FOR THE ELEVENTH CIRCUIT
                           ________________________

                             Nos. 15-10779; 10-12957
                           ________________________

                       D.C. Docket No. 1:09-md-02036-JLK

THOMAS LARSEN, etc., et al.,

                                                                             Plaintiffs,

DAVID JOHNSON,
on behalf of himself and all others similarly situated,

                                                                  Plaintiff-Appellee,

versus

CITIBANK FSB, et al.,

                                                                           Defendants,

KEYBANK NATIONAL ASSOCIATION,

                                                              Defendant-Appellant.
               Case: 15-10779        Date Filed: 09/26/2017       Page: 2 of 55

                               ________________________

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

                                    (September 26, 2017)

Before TJOFLAT, JULIE CARNES and MELLOY, ∗ Circuit Judges.

JULIE CARNES, Circuit Judge:

       Plaintiff David Johnson filed a putative class-action suit against Defendant

KeyBank National Association in 2010, alleging that KeyBank improperly

manipulated the order of debit card transactions in customer accounts in order to

maximize collection of overdraft fees. This appeal relates not to the substance of

Johnson’s suit but to the enforceability of an arbitration provision contained in the

agreement that governs Johnson’s accounts with KeyBank. KeyBank seeks to

compel arbitration of Johnson’s substantive claims, while Johnson argues that the

applicable arbitration provision is invalid against him. The district court denied

KeyBank’s motion to compel on grounds of unconscionability. KeyBank now

appeals. Following oral argument and careful consideration of the record, we

∗
  Honorable Michael J. Melloy, United States Circuit Judge for the Eighth Circuit, sitting by
designation.

                                                2
              Case: 15-10779     Date Filed: 09/26/2017    Page: 3 of 55

reverse the district court’s order and remand the case to the district court with

instructions to compel arbitration.

                                  BACKGROUND

      Johnson’s relationship with KeyBank began in 1991, when he opened a

checking account at Puget Sound Bank in Tukwila, Washington. KeyBank

acquired Puget Sound Bank two years later and took over Johnson’s checking

account thereafter. Johnson has opened at least six additional deposit accounts

with KeyBank since that time.

      The underlying claims against KeyBank relate to a single checking account

that Johnson has held jointly with his wife since 2001 (the “Joint Account”). In

substance, Johnson argues that KeyBank improperly changed the sequence of debit

card transactions from the Joint Account in order to maximize overdraft fees

charged to the account. Johnson filed a class-action suit in 2010 in the United

States District Court for the Western District of Washington. The case was

transferred for pretrial purposes to a multidistrict proceeding pending in the

Southern District of Florida under 28 U.S.C. § 1407. Johnson seeks to litigate this

dispute as a class action in federal court, while KeyBank urges that Johnson’s

claims must be resolved through individual arbitration. It has been settled in this

proceeding that, in light of the Supreme Court’s holding in AT&T Mobility LLC v.

                                           3
              Case: 15-10779    Date Filed: 09/26/2017   Page: 4 of 55

Concepcion, 563 U.S. 333 (2011), Johnson has waived his right to arbitrate on a

class basis. See In re Checking Account Overdraft Litigation, 754 F. 3d 1290,

1293 (11th Cir. 2014).

      The timing of the formation of the pertinent contractual relationship between

Johnson and KeyBank is a threshold factual issue in this appeal. Johnson first

opened the checking account as an individual customer in 1991, and he held the

account individually for ten years before converting it in 2001 to a joint account

with his wife. Although Johnson recalls few of the details surrounding the

conversion of the individual account to the Joint Account, there is no dispute that

he and his wife visited a KeyBank branch on October 11, 2001, and signed a

signature card (the “2001 Signature Card”) to effectuate the conversion.

      The 2001 Signature Card characterizes the Joint Account as a “replacement”

of Johnson’s preexisting individual account. Importantly, by signing the 2001

Signature Card, Johnson and his wife confirmed their understanding that “all

accounts opened under this Plan are subject to [KeyBank’s] Deposit Account

Agreement” and acknowledged receipt of a copy of that agreement. While there is

no testimonial evidence that Johnson and his wife were, in fact, provided a copy of

the agreement at the time they signed the 2001 Signature Card, the record does

                                          4
              Case: 15-10779      Date Filed: 09/26/2017   Page: 5 of 55

reflect that it was standard KeyBank policy to provide a copy of that agreement to

at least one of the parties to a joint account.

      At the time, the governing agreement was KeyBank’s June 2, 1997, deposit

account agreement (the “1997 Agreement”), which contained an arbitration

provision. The 1997 Agreement also preserved KeyBank’s right to make unilateral

changes to the terms of the Agreement after providing accountholders with

appropriate notice, such as through so-called “statement messages” that KeyBank

frequently mailed to customers along with their monthly account statements.

      KeyBank has exercised this right of unilateral amendment several times

since October 2001, and the deposit account agreement governing the Joint

Account has evolved accordingly. The current version of the agreement—and the

one on which Johnson bases his substantive claims—dates to December 2009 (the

“2009 Agreement”). There are three features of the 2009 Agreement relevant to

this appeal. First is, of course, the arbitration provision that Johnson now seeks to

invalidate (the “2009 Arbitration Provision”). This provision has appeared in

KeyBank’s deposit account agreement in some form since at least 1995. Second is

a choice-of-law provision, which specifies that Ohio law shall govern all disputes

relating to customer accounts. Third is a change-in-terms provision, which

                                            5
              Case: 15-10779    Date Filed: 09/26/2017    Page: 6 of 55

preserves KeyBank’s right “to change or add to” the terms of the Agreement upon

“such notice . . . as [KeyBank] determine[s] is appropriate.”

      KeyBank maintains that Johnson affirmatively agreed to the 1997

Agreement—including its arbitration provision—when he signed the 2001

Signature Card. That being so, the Joint Account has, at all times since its creation

in 2001, been governed by a deposit account agreement that contains an agreement

to arbitrate. As such, KeyBank concludes, Johnson is unequivocally bound by the

2009 Arbitration Provision, which is merely an updated version of the arbitration

provision to which Johnson originally assented. KeyBank further contests the

district court’s conclusion that the 2009 Arbitration Provision is unenforceable

under applicable state law.

      Notwithstanding his written attestation confirming he had received the

agreement, Johnson counters that he did not receive a copy of the 1997 Agreement

at the time the account was formed and therefore did not bind himself to it upon

signing the 2001 Signature Card. He further insists that he has not separately

agreed to arbitrate at any point during the lifetime of the Joint Account. Instead, he

argues, the Joint Account is governed by the earlier version of the KeyBank

deposit account agreement governing his original individual account, which

agreement lacked an arbitration provision altogether. Thus, Johnson argues that no

                                          6
               Case: 15-10779   Date Filed: 09/26/2017    Page: 7 of 55

agreement to arbitrate exists between himself and KeyBank. In the alternative, he

argues that—even if an agreement to arbitrate exists between the parties—such an

agreement is unconscionable and illusory under relevant state law.

       KeyBank moved to compel arbitration in the district court on August 22,

2014. In deciding this motion, the district court considered only two issues: (1)

whether the law of Washington or of Ohio governs the enforceability of the

arbitration provision; and (2) whether, under applicable state law, the arbitration

provision is unconscionable and therefore unenforceable. The district court did not

consider the threshold question of whether an agreement to arbitrate was formed in

the first instance.

       In its final analysis, the district court denied KeyBank’s motion to compel

arbitration, finding that Washington law governed the question of enforceability

and that, under such law, the provision was unconscionable. KeyBank has

appealed from this order. We now reverse the district court’s decision and hold

that arbitration must be compelled in this case.

                            STANDARD OF REVIEW

       We review a district court’s denial of a motion to compel arbitration de

novo. Collado v. J. & G. Transp., Inc., 820 F.3d 1256, 1259 (11th Cir. 2016). We

may affirm the district court’s decision on any ground supported by the record.

                                          7
                Case: 15-10779   Date Filed: 09/26/2017   Page: 8 of 55

Ironworkers Local Union 68 v. AstraZeneca Pharms., LP, 634 F.3d 1352, 1360

(11th Cir. 2011).

                                   DISCUSSION

      The parties have raised several issues on appeal, only two of which were

addressed by the district court below. We may decide each of the issues the parties

have raised on de novo review, as the parties have been fully heard on the issues

and the record is complete. Walter v. Blue Cross & Blue Shield United of

Wisconsin, 181 F.3d 1198, 1202 (11th Cir. 1999). Considering each argument in

turn, we find no ground on which to relieve Johnson of his commitment to arbitrate

this dispute.

I.    Existence of Agreement to Arbitrate

      The threshold issue is whether, as a matter of contract formation, there exists

an agreement between Johnson and KeyBank to arbitrate disputes relating to the

Joint Account. It is well settled that “arbitration is a creature of contract.” Brown

v. ITT Consumer Fin. Corp., 211 F.3d 1217, 1221 (11th Cir. 2000) (quotation

marks omitted); see also AT&T Techs., Inc. v. Commc’ns Workers of Am., 475 U.S.

643, 649 (1986). A court cannot compel parties to arbitrate their dispute in the

absence of clear agreement to do so. Klay v. All Defendants, 389 F.3d 1191, 1200

(11th Cir. 2004). In order “[t]o satisfy itself that such agreement exists,” courts

                                           8
                Case: 15-10779       Date Filed: 09/26/2017       Page: 9 of 55

must undertake to resolve any issues relating to the formation of the arbitration

agreement, Granite Rock Company v. International Brotherhood of Teamsters, 561

U.S. 287, 297 (2010), as Johnson has asked us to do here.

       The Supreme Court has made clear that this inquiry is a matter of state

contract law. First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995)

(“[C]ourts generally . . . should apply ordinary state-law principles that govern the

formation of contracts” in determining whether the parties have agreed to

arbitrate.). See also Burch v. P.J. Cheese, Inc., 861 F.3d 1338, 1346 (11th Cir.

2017) (confirming that state contract law governs the question whether an

agreement to arbitrate exists); Dasher v. RBC Bank (USA), 745 F.3d 1111, 1116

(11th Cir. 2014) (same). 1 Thus, this Court’s first task is to identify the applicable

state law.

1
  Prior to the Supreme Court’s instruction in First Options of Chicago, Inc. v. Kaplan, 514 U.S.
938 (1995), this Court applied a “two-component test” to determine whether an agreement to
arbitrate existed: the party seeking to avoid arbitration was required (1) to deny unequivocally
that an agreement to arbitrate existed and (2) to provide evidence substantiating that denial.
Wheat, First Securities, Inc. v. Green, 993 F.2d 814, 817 (11th Cir. 1993); see also Chastain v.
Robinson-Humphrey Co., Inc., 957 F.2d 851, 855 (11th Cir. 1992) (requiring the party denying
the existence of arbitration agreement to substantiate that denial with “enough evidence to make
the denial colorable”).

As we recently explained in Bazemore v. Jefferson Capital Sys., LLC, 827 F.3d 1325 (11th Cir.
2016), we no longer rely on this test. See id. at 1330 (“[I]n the nearly quarter-century since
Chastain and Green, no published decision of this Court has cited either case for the proposition
that the burden is on the party denying the existence of an arbitration agreement to deny its
existence ‘unequivocally’ and substantiate that denial with proof.”). Instead, we defer solely to

                                                9
               Case: 15-10779        Date Filed: 09/26/2017        Page: 10 of 55

       A.      Choice of Law

       In a multi-district case transferred under 28 U.S.C. § 1407, the transferee

court applies the choice-of-law rules of the state in which the action was filed.

Menowitz v. Brown, 991 F.2d 36, 40 (2d Cir. 1993) (citing Van Dusen v. Barrack,

376 U.S. 612 (1964)). Johnson’s banking relationship with KeyBank is based in

Washington, and he initially filed suit in the United States District Court for the

Western District of Washington. Thus, Washington’s choice-of-law rules control

where there is a potential conflict of laws.

       In this case, the laws of two states potentially apply: Washington, the state

in which Johnson’s claims arose, and Ohio, the state agreed to in the parties’

choice-of-law provision.2 Washington courts enforce valid choice-of-law

applicable state-law principles in determining the quality and quantum of evidence required to
deny or prove the existence of an agreement. See, e.g., id. at 1334 (finding that defendant failed
to meet its burden under Georgia law to prove the existence of the arbitration agreement it sought
to enforce).
2
  The parties do not dispute the validity of the choice-of-law provision contained in the 2009
Agreement, which states: “This Agreement and all Accounts shall be governed by the laws of
the State of Ohio (without regard for conflict of law rules) and applicable federal law, but with
respect to all fees and charges related to your Account, federal law alone shall control.”

As the district court correctly noted, the choice of Ohio law is proper given that KeyBank is
headquartered in that state. See McKee v. AT&T Corp., 191 P.3d 845, 8511 & n.6 (Wash. 2008)
(noting that, in order for Washington courts to enforce the parties’ contractual choice of law, the

                                                10
               Case: 15-10779       Date Filed: 09/26/2017       Page: 11 of 55

agreements except in certain exceptional circumstances. See Schnall v. AT&T

Wireless Servs., Inc., 259 P.3d 129, 131 (Wash. 2011) (noting that Washington

courts “generally enforce contract choice of law provisions”).3 The parties do not

allege that any such circumstances exist here. Indeed, Johnson asserts that there

exists no material conflict between Washington and Ohio law on the issue of

contract formation, and KeyBank does not disagree. As a result, we look to Ohio

law to determine whether Johnson agreed to arbitrate. 4

       B.     Formation of Agreement

       In Ohio, the essential elements of a contract include an offer, acceptance,

contractual capacity of the parties, consideration, and a manifestation of mutual

parties must show that the chosen state has a substantial relationship to the parties or provide
another reasonable basis for the choice) (citing Restatement (Second) of Conflict of Laws § 187).
3
  Specifically, Washington courts will disregard contractual choice-of-law provisions and apply
Washington law only where: (1) Washington law would apply absent the provision;
(2) application of the chosen state’s law would violate a fundamental public policy of
Washington; and (3) Washington’s interest in the determination of the issue materially outweighs
the interest of the chosen state. McKee, 191 P.3d at 851. See also 25 Wash. Prac., Contract Law
and Practice § 5:18 (3d ed.).
4
  Johnson broadly asserts that “Ohio and Washington law do not disagree on the requisites of
contract formation” and proceeds to rely on case law from both states to support his contention
that no agreement to arbitrate was formed. Ohio and Washington law may indeed be in accord
on many bedrock principles of contract law. But because the parties have selected Ohio law—
and because there are no grounds to disregard that choice on the issue of contract formation—we
confine our analysis to Ohio law.

                                               11
             Case: 15-10779    Date Filed: 09/26/2017    Page: 12 of 55

assent. See Rayess v. Educ. Comm’n for Foreign Med. Graduates, 983 N.E.2d

1267, 1271 (Ohio 2012); 17 Ohio Jur. 3d Contracts § 7.

      The element of mutual assent requires a “meeting of the minds as to the

essential terms of the contract,” the absence of which renders a contract

unenforceable. Rayess, 983 N.E.2d at 1271–72; see also 17 Ohio Jur. 3d Contracts

§ 15. In assessing the existence of mutual assent in the consumer context, Ohio

courts adhere to the “legal and common-sensical axiom that one must read what

one signs.” Mishler v. Hale, 26 N.E.3d 1260, 1271 (Ohio Ct. App. 2014) (citing

ABM Farms, Inc. v. Woods, 692 N.E.2d 574, 579 (Ohio 1998)); see also Ball v.

Ohio State Home Servs., Inc., 861 N.E.2d 553, 556–57 (Ohio Ct. App. 2006)

(finding homeowner bound to contract he knowingly declined to read). This

principle extends to consumers consenting to arbitration provisions in contracts of

adhesion: In Ohio, a consumer “of ordinary mind” is bound by an arbitration

provision he has signed as long as he has had the opportunity to review it before

assenting. See DeVito v. Autos Direct Online, Inc., 37 N.E.3d 194, 208 (Ohio Ct.

App. 2015) (finding a “meeting of the minds” between consumer and auto dealer

as to arbitration agreement where consumer had opportunity to read and

understand terms of the agreement before signing) (citing ABM Farms, 692 N.E.2d

at 574).

                                         12
             Case: 15-10779     Date Filed: 09/26/2017    Page: 13 of 55

      As such, Ohio courts have charged consumers with an affirmative

“responsibility to learn the terms of [a] contract prior to agreeing” to them. Moore

v. Houses on the Move, Inc., 895 N.E.2d 579, 584 (Ohio Ct. App. 2008) (finding

consumer bound to arbitration clause contained in construction contract despite her

failure to read it). When the formation of a contract is at issue, the party asserting

that a contract was formed bears the burden of establishing its existence. Advance

Sign Grp., LLC v. Optec Displays, Inc., 722 F.3d 778, 784 (6th Cir. 2013) (citing

Guardian Alarm Co. v. Portentoso, 963 N.E.2d 225, 230 (Ohio Ct. App. 2011)).

             1.     Johnson’s Assent to the 1997 Agreement and Its Arbitration
                    Provision

      The parties identify several points during the lifetime of the Joint Account at

which Johnson might have assented to the arbitration provision, but KeyBank’s

core contention is that the agreement to arbitrate arose in October 2001, when

Johnson and his wife executed the 2001 Signature Card to convert Johnson’s

individual checking account to the Joint Account. Upon examination of Johnson’s

account documents, we agree.

      The 2001 Signature Card, alternatively referred to as the “Account Express

Plan,” provided that “[t]his Plan is the signature card for all accounts opened under

this Plan.” (Emphasis added.) It further required signatories to attest to the

following:

                                          13
             Case: 15-10779    Date Filed: 09/26/2017   Page: 14 of 55

      I understand that all accounts opened under this Plan are subject to the
      Deposit Account Agreement. I acknowledge receiving a copy of the
      agreement, and a written disclosure of the interest rate, annual
      percentage yield, fees and other terms and disclosures relating to the
      account opened at the time this Plan was signed.

(Emphasis added.) Text at the top of the document signaled that the 2001

Signature Card functioned as a “Replacement” of the card associated with the

preexisting account, while text at the bottom warned the customer that “[t]he

information you are providing to open your new KeyBank account is subject to

review.” (Emphasis added.)

      There is no dispute that both Johnson and his wife signed the 2001 Signature

Card in person in one of KeyBank’s branch offices. Moreover, the parties have

produced no evidence to suggest that Johnson and his wife lacked an opportunity

to read and understand this one-page document prior to signing it.

      Arguably, the language with which KeyBank communicates to its customers

the legal impact of a “replacement” card could be clearer, especially where an

individual account is being converted to a joint account. But in order to find an

objective “meeting of the minds,” Ohio courts ask only whether the terms of the

agreement are clear and unambiguous on their face. See 216 Jamaica Ave., LLC v.

S & R Playhouse Realty Co., 540 F.3d 433, 440 (6th Cir. 2008) (citing Nilavar v.

Osborn, 711 N.E.2d 726, 733 (Ohio Ct. App. 1998)). And a straightforward

                                         14
             Case: 15-10779    Date Filed: 09/26/2017   Page: 15 of 55

reading of the 2001 Signature Card makes clear that, in signing it, Johnson was

displacing his individual account with a new incarnation of that account under new

ownership. The account was plainly characterized as a “replacement” of the

preexisting one—not merely a continuation of it. And the Card unambiguously

authorized the “opening” of an account—not merely the modification of one.

Given the clear terms of the document, Johnson was on notice that signing the

2001 Signature Card represented the start of a new contractual relationship with

KeyBank.

      This new contractual relationship was governed by a new deposit account

agreement. Again, this fact was made plain on the face of the 2001 Signature

Card, which stated that the account opened thereunder would be “subject to the

Deposit Account Agreement.” In October 2001, new accounts opened at KeyBank

were governed by the 1997 Agreement, complete with its arbitration provision.

There is little question that, under Ohio law, the Card’s “subject to” language was

sufficient to incorporate the 1997 Agreement—along with its arbitration

provision—into the 2001 Signature Card by reference, even if a copy of the

Agreement was not provided to Johnson at the time he signed the Card. See, e.g.,

Blanchard Valley Farmers Coop., Inc. v. Carl Niese & Sons Farms, Inc., 758

N.E.2d 1238, 1244–45 (Ohio Ct. App. 2001) (finding language that purchase was

                                         15
               Case: 15-10779        Date Filed: 09/26/2017        Page: 16 of 55

made “subject to” relevant trade rules sufficient to incorporate those trade rules—

including their arbitration provision—into sales contract); Int’l Bhd. of Elec.

Workers, Local Union No. 8 v. Gromnicki, 745 N.E.2d 449, 452 (Ohio Ct. App.

2000) (concluding that, where incorporation of external document by reference

was “apparent” from language of contract, signatory to the contract was bound to

the external document and noting that “[t]he fact that the contract comprised more

than one document [was] irrelevant”). See also Moore, 895 N.E.2d at 584–85

(noting that, under Ohio law, even a non-signatory to an arbitration agreement may

be bound to it under the doctrine of incorporation by reference). Thus, the 1997

Agreement became effective as to the Joint Account at the time Johnson signed the

2001 Signature Card.5

       Johnson challenges this interpretation of the 2001 transaction on two

grounds. First, he argues that the creation of the Joint Account was a mere

continuation of Johnson’s preexisting account, meaning that it was governed by an

earlier version of the deposit account agreement that lacked an arbitration

provision altogether. As explained above, the signature card alerted the signatory

5
  It is worth noting that Johnson selectively misreads the plain language of the 2001 Signature
Card, insisting that the Card “merely acknowledged receipt of a separate agreement” and “did
not use ‘subject to’ language, or anything like it.” This assertion is plainly wrong, rendering his
reading of the contract—and the argument based thereon—careless at best and disingenuous at
worst.

                                                16
               Case: 15-10779       Date Filed: 09/26/2017      Page: 17 of 55

that this was a new account. Further, as a longtime KeyBank customer, Johnson

knew that the terms governing his accounts with KeyBank were not set in stone. 6

He was thus on notice that a new version of the deposit account agreement, which

incorporated terms different from the ones he had agreed to in the past, might

apply to the newly formed Joint Account he opened in 2001. Finally, Johnson was

alerted as early as 1993 that the act of signing a signature card at KeyBank could

have the effect of binding him to the terms of the applicable deposit account

agreement.7 Thus, Johnson’s insistence that he “did not agree to anything” by

signing the 2001 Signature Card rings hollow. Because Johnson had a basic

awareness of the implications of signing the 2001 Signature Card, he had a

responsibility under Ohio law to make himself aware of the terms of the applicable

agreement before signing them. See Moore, 895 N.E.2d at 584 (establishing that a

6
  Johnson was aware as early as 1991 that the terms of the agreement governing his account with
KeyBank were subject to periodic amendment. The deposit account agreement Johnson signed
in 1991, when he first opened an account with KeyBank’s predecessor, provided: “We may
change these Rules at any time after providing notice through written posting in the lobby of the
bank.”
7
  The version of the deposit account agreement that became effective in 1993, when KeyBank
acquired Puget Sound Bank and took over Johnson’s preexisting account, stated on its first page
that “[b]y accepting a copy of these Rules, signing your deposit account signature card,” and
“continuing your account, you agree to be bound by these Rules, the Signature Card and any
subsequent amendments to either.” (Emphasis added.) The parties do not dispute that Johnson
received this early version of the deposit account agreement and agreed to its terms.

                                               17
               Case: 15-10779       Date Filed: 09/26/2017      Page: 18 of 55

consumer “entering [into] a contract has a responsibility to learn the terms of the

contract prior to agreeing to [them]”).

       Second, Johnson argues that even if the 1997 Agreement was the operable

contract at the time, he did not assent to it because he did not receive a copy of it

when he signed the 2001 Signature Card. This argument leans on a very thin reed.

Specifically, Johnson testified only to the absence of any memory, one way or

another, whether he received a copy of the agreement: “I have no recollection if I

was or wasn’t given a copy (of the applicable deposit account agreement).” In

trying to transform his “I don’t remember” testimony to an “I didn’t receive”

assertion, Johnson cites to the testimony of a KeyBank employee, Rosemary Klee,

who stated that “on a joint account . . . we only have to give the [deposit account

agreement] to one of the parties.” Johnson misconstrues and misquotes this

testimony. 8 If anything, the procedure Ms. Klee describes makes it more, rather

than less, likely that Johnson was given a copy of the 1997 Agreement when he

signed the 2001 Signature Card. Furthermore, by signing the 2001 Signature Card,

Johnson attested that he had “received a copy of the agreement . . . relating to the

8
  Specifically, Johnson states in his brief that, according to Ms. Klee, “it was not ‘standard
policy’ for KeyBank to give the agreement ‘[t]o either party’” to a joint account. To the
contrary, Ms. Klee’s testimony suggests only that it was not standard policy for KeyBank to give
the agreement to both parties when a joint account was formed. Disclosure to one of the parties
sufficed.

                                               18
             Case: 15-10779     Date Filed: 09/26/2017   Page: 19 of 55

account opened at the time [the Card] was signed.” Johnson’s failure to remember

any details of the October 11, 2001, transaction is obviously not sufficient to rebut

the inference we draw from his written, contemporaneous acknowledgement of

receipt.

      Finally, whether Johnson was handed a copy of the deposit account

agreement that would govern the Joint Account and that was incorporated by

reference into the 2001 Signature Card is, ultimately, irrelevant: A consumer of

“ordinary mind” has an obligation to “read what [he] signs.” ABM Farms, 692

N.E.2d at 579. If we permitted Johnson to evade the commitment to arbitrate by

claiming he did not investigate the terms to which his new account was subject

before signing the 2001 Signature Card, few deposit agreements would ever be

enforceable. See id. (citing Upton v. Tribilcock, 91 U.S. 45, 50 (1875)).

      By providing uncontroverted evidence of Johnson’s execution of the 2001

Signature Card, KeyBank has met its burden of establishing that Johnson

consented to the arbitration provision incorporated by reference therein. See

Advance Sign Grp., LLC, 722 F.3d at 784 (citing Portentoso, 963 N.E.2d at 230).

             2.    Johnson’s Assent to the 2009 Arbitration Provision

      The 1997 Agreement provided that KeyBank “reserve[s] the right to change

the terms of this Agreement . . . at any time” after providing “such notice of the

                                         19
             Case: 15-10779     Date Filed: 09/26/2017    Page: 20 of 55

change as we determine is appropriate, such as by statement message or

enclosure.” We have concluded that Johnson agreed to the arbitration provision

contained in the 1997 Agreement. KeyBank exercised its revision right in June

2004, when it included with Johnson’s account statement a revised version of the

arbitration provision that would “apply to [the Joint Account] unless you notify us

in writing . . . that you reject the Arbitration Provision,” along with a “statement

message” explaining Johnson’s options (the “2004 Statement Message”).

      Johnson did not object to this or any subsequent revision to the arbitration

provision applicable to the Joint Account. Instead, he continued to use his account

under the newly revised terms. As such, his argument that he did not assent to the

revised version of the arbitration provision that appears in the 2009 Agreement—

the very agreement on which his substantive claims are now based—must fail.

      C.     Necessity of Trial

      “At worst,” Johnson finally argues, he is entitled to a jury trial on the

question whether an agreement to arbitrate was formed. He hangs this argument

on section 4 of the Federal Arbitration Act (the “FAA”), which governs the 2009

                                          20
               Case: 15-10779       Date Filed: 09/26/2017      Page: 21 of 55

Arbitration Provision9 and states that “[i]f the making of the arbitration agreement

. . . be in issue, the court shall proceed summarily to the trial thereof.” 9 U.S.C.

§ 4.

       We recently joined our sister circuits in holding that a summary judgment–

like standard is appropriate in determining whether a trial is necessary under

section 4 of the FAA. Bazemore v. Jefferson Capital Sys., LLC, 827 F.3d 1325,

1333 (11th Cir. 2016). According to this standard, a court may conclude as a

matter of law that parties entered into an arbitration agreement only if “there is no

genuine dispute as to any material fact” concerning the formation of the arbitration

agreement. Id. (citing Fed. R. Civ. P. 56(a)). When there is no such dispute, a trial

is unnecessary. Id. at 1332 (declining to provide losing party with “a second bite at

the apple” by granting trial on the existence of an arbitration agreement where no

genuine fact dispute existed).

       The only potential factual dispute to which Johnson alludes is the question

whether KeyBank provided Johnson with a copy of the applicable deposit account

agreement at the time he signed the 2001 Signature Card. But, as discussed above,

9
  The 2009 Arbitration Provision is governed by the FAA because the loan agreement was
executed via interstate commerce. See 9 U.S.C. § 2; Parnell v. CashCall, Inc., 804 F.3d 1142,
1146 (11th Cir. 2015).

                                              21
               Case: 15-10779   Date Filed: 09/26/2017   Page: 22 of 55

Johnson does not claim that he did not receive the document, nor does he present

any evidence to suggest as much. He merely asserts that he cannot recall whether

he received a copy of that document. His lack of memory is insufficient to create a

genuine dispute of fact. And anyway, as our analysis above demonstrates, his

physical receipt of a copy of the document at that time is not crucial to our finding

that his signature on the 2001 Signature Card bound him to the 1997 Agreement.

Thus, summary judgment is warranted.

II.   Enforceability of Agreement to Arbitrate

      KeyBank next argues that the district court erred in finding the 2009

Arbitration Provision unenforceable under applicable state law. We agree that the

court erred.

      The 2009 Arbitration Provision is governed by the FAA because the loan

agreement was executed via interstate commerce. See 9 U.S.C. § 2; Parnell v.

CashCall, Inc., 804 F.3d 1142, 1146 (11th Cir. 2015). “The FAA places

arbitration agreements on equal footing with all other contracts and sets forth a

clear presumption—‘a national policy’—in favor of arbitration.” Parnell, 804 F.3d

at 1146 (citing Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 443

(2006)). Where an agreement to arbitrate has been formed, the court must treat the

agreement as “valid, irrevocable, and enforceable, save upon such grounds as exist

                                          22
             Case: 15-10779     Date Filed: 09/26/2017    Page: 23 of 55

at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. Under the

FAA, an agreement can be “defeated by fraud, duress, unconscionability, or

another ‘generally applicable contract defense.’” Parnell, 804 F.3d at 1146

(quoting Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63, 67–68 (2010)).

Johnson seeks to defeat the 2009 Arbitration Provision by arguing that it is

unconscionable and illusory under applicable common law. We review each

argument de novo.

      A.     Choice of Law

      We must address whether the law of Washington (the state where the Joint

Account is held) or Ohio (the state of the parties’ contractual selection) governs

Johnson’s enforceability challenges. As explained above, Washington’s rules

instruct us to enforce the parties’ choice of Ohio law even if it conflicts with

Washington law, unless application of Ohio law would violate a fundamental

public policy of Washington. See McKee v. AT&T Corp., 191 P.3d 845, 851

(Wash. 2008).

      Washington and Ohio law do differ as to the requirements for proving

unconscionability as an enforcement defense, with Washington setting out an

easier test for one asserting that an agreement is unconscionable. Ohio law

requires Johnson to prove that the 2009 Arbitration Provision is both procedurally

                                          23
             Case: 15-10779     Date Filed: 09/26/2017    Page: 24 of 55

and substantively unconscionable before it can be struck down. See Hayes v.

Oakridge Home, 908 N.E.2d 408, 412 (Ohio 2009) (“The party asserting

unconscionability of a contract bears the burden of proving that the agreement is

both procedurally and substantively unconscionable.”). Under Washington law,

however, an agreement may be invalidated on a showing of either substantive or

procedural unconscionability. See Gandee v. LDL Freedom Enters., Inc., 293 P.3d

1197, 1199 (Wash. 2013) (noting that either substantive or procedural

unconscionability is enough to void an agreement in Washington); Gorden v. Lloyd

Ward & Assocs., P.C., 323 P.3d 1074, 1079–80 (Wash. Ct. App. 2014)

(invalidating agreement as procedurally unconscionable and declining to address

substantive unconscionability because “our analysis is done”).

      In relevant part, the district court found that to apply Ohio law in this

context—that is, to require Johnson to demonstrate that the 2009 Arbitration

Provision is both procedurally and substantively unconscionable—“would violate

Washington’s public policy of invalidating a contract on a finding of either

procedural or substantive unconscionability.” Having found the 2009 Arbitration

Provision to be substantively unconscionable, the district court therefore concluded

that it was unenforceable under Washington’s “either/or” unconscionability

standard.

                                          24
             Case: 15-10779      Date Filed: 09/26/2017    Page: 25 of 55

      The district court’s determination that application of Ohio’s test for

unconscionability would violate Washington’s public policy hinges on an analysis

of the nuances of the latter state’s public-policy goals in the context of contract

enforcement. This is a subject, however, on which Washington courts have

provided little guidance, and Keybank strongly disagrees with the district court’s

conclusion. Nevertheless, we do not find it necessary to decide this question. Even

assuming that, under these circumstances, Washington law would require

application of its own test for unconscionability, instead of Ohio’s, we conclude

that the 2009 Arbitration Provision is neither procedurally nor substantively

unconscionable, rendering it enforceable under both Washington and Ohio law.

Similarly, we need not inquire into the difference between Washington and Ohio

law respecting Johnson’s final argument that the 2009 Arbitration Provision is

illusory, as we do not find it illusory under either state’s standard.

      A.     Unconscionability

      We first assess the conscionability of the 2009 Arbitration Provision. We

conclude that the 2009 Arbitration Provision was not formed in a procedurally

unconscionable manner under either Washington or Ohio law. That conclusion

ends any challenge by Johnson on the ground of unconscionability under Ohio law.

As to Washington’s requirement that an agreement can be struck if it is only

                                           25
             Case: 15-10779    Date Filed: 09/26/2017   Page: 26 of 55

substantially unconscionable, we conclude that all but one of the at-issue portions

of the Provision are substantively conscionable under Washington law, and we

sever this one unconscionable provision.

             1.    Procedural Unconscionability

      The courts of both Washington and Ohio characterize procedural

unconscionability as the absence of “meaningful choice” as to the terms of the

agreement in light of all the circumstances surrounding the transaction. See

Gorden, 323 P.3d at 1079; Hayes, 908 N.E.2d at 412. Deciding this question is a

fact-intensive inquiry. Washington courts take a broad view of the facts,

examining “the manner in which the contract was entered, whether each party had

reasonable opportunity to understand the terms of the contract, and whether the

important terms were hidden in a maze of fine print.” Gorden, 323 P.3d 1079

(citing Nelson v. McGoldrick, 896 P.2d 1258 (Wash. 1995)) (internal quotation

marks and alterations accepted). Ohio courts consider a narrower range of factors,

examining “age, education, intelligence, business acumen and experience” to

determine whether the “weaker party” was able to protect his interests. Taylor

Bldg. Corp. of Am. v. Benfield, 884 N.E.2d 12, 22–23 (Ohio 2008).

                                           26
             Case: 15-10779     Date Filed: 09/26/2017   Page: 27 of 55

      There are two transactions between KeyBank and Johnson that warrant

examination for procedural conscionability. The first is the signing of the 2001

Signature Card on October 11, 2001, which, we have held, bound Johnson to the

1997 Agreement and the arbitration provision contained therein. The second is the

2004 modification of that arbitration provision, notice of which was mailed to

Johnson via the 2004 Statement Message before the modification took effect. We

analyze them separately.

             i.    Johnson’s Assent to the 1997 Agreement and Its Arbitration
                   Provision

      It is well settled in Washington and Ohio that contracts of adhesion are not

procedurally unconscionable per se. See Zuver v. Airtouch Commc’ns, Inc., 103

P.3d 753, 760 (Wash. 2004) (“[T]he fact that an agreement is an adhesion contract

does not necessarily render it procedurally unconscionable.”); Benfield, 884 N.E.2d

at 24 (“[E]ven a contract of adhesion is not in all instances unconscionable per se,”

as standardized contracts “can provide advantages to consumers.”). Nor does the

existence of unequal bargaining power alone justify a finding of procedural

unconscionability; instead, the “key inquiry” remains whether the party lacked a

meaningful choice in assenting to the relevant terms. Romney v. Franciscan Med.

Grp., 349 P.3d 32, 38 (Wash. Ct. App. 2015). See also Zuver, 103 P.3d at 761;

Hayes, 908 N.E.2d at 412–13.

                                         27
               Case: 15-10779       Date Filed: 09/26/2017      Page: 28 of 55

       The parties agree that the deposit account agreement is a contract of

adhesion that was presented to Johnson on a take-it-or-leave-it basis when he

opened the Joint Account. Johnson concedes that this fact alone does not prove

procedural unconscionability. He maintains, however, that he “had no ‘meaningful

choice’ but to be bound” by the arbitration provision because it was a boilerplate

term that he (1) was not given the opportunity to review before opening the Joint

Account and (2) was not invited to strike from the agreement before he signed it.10

       Much of Johnson’s argument with respect to the 2001 transaction relies on

his unsubstantiated contention that he did not receive a copy of the 1997

Agreement at the time he signed the 2001 Signature Card. As discussed above,

Johnson had an opportunity and an incentive to inquire about and review the 1997

Agreement, including its arbitration provision, before confirming his

understanding that the Joint Account would be “subject to” its terms. And in the

absence of evidence to the contrary, we have no reason to disregard his

10
   Johnson does not contend that his age, intelligence, business acumen, or experience—
significant factors in Ohio’s procedural-unconscionability analysis, see Benfield, 884 N.E.2d at
22–23—prevented him from making a meaningful choice when he signed the 2001 Signature
Card. In fact, Johnson engaged in continuous banking business with KeyBank over the course of
almost ten years before assenting to the 1997 Agreement, leaving him with extensive exposure to
the standard procedures by which KeyBank managed customer accounts. Cf., e.g., Porpora v.
Gatliff Bldg. Co., 828 N.E.2d 1081, 1084 (Ohio Ct. App. 2005) (finding adhesive construction
contract procedurally unconscionable because, among other reasons, consumers had no previous
experience reviewing construction contracts).

                                              28
               Case: 15-10779       Date Filed: 09/26/2017       Page: 29 of 55

acknowledgement on the 2001 Signature Card that he had received a copy of the

agreement relating to the Joint Account. Cf., e.g., Swayze v. The Huntington Inv.

Co., No. 20630, 2005 WL 1208116, at *1–5 (Wash. Ct. App. May 20, 2005)

(finding no procedural unconscionability under Ohio law—in spite of investor’s

contention that he never received a copy of the agreement—because investor had

signed a statement confirming receipt of agreement). Testimony offered by

KeyBank supports our conclusion that Johnson did indeed have an opportunity to

read and understand the terms of the 1997 Agreement when he opened the Joint

Account.11

       If Johnson had used this opportunity to review the 1997 Agreement, he

would have been alerted to the presence of an arbitration provision. The table of

contents of the 1997 Agreement lists “Arbitration; Waiver of Jury Trial” as one of

twenty-eight sub-sections and directs the reader to page eleven of the agreement.

The clause itself appears on a single page, set off in a new paragraph that bears the

title “Arbitration; Waiver of Jury Trial” in bold-faced type. The remainder of the

provision’s text appears in the same type as every other term in the agreement.

11
   As noted supra, a representative of KeyBank testified that “on a joint account . . . the policy
procedure is [that] we only have to give the [deposit account agreement] to one of the parties” on
the account.

                                               29
             Case: 15-10779     Date Filed: 09/26/2017    Page: 30 of 55

      Having reviewed this 1997 Agreement, we do not find the arbitration

provision so “hidden in a maze of fine print” that Johnson was precluded from

exercising meaningful choice before assenting to it. Even a cursory scan of the

table of contents would put the average customer on inquiry notice of the existence

and implications of the provision, including the waiver of a jury trial. Cf., e.g.,

Zuver, 103 P.3d at 761 (declining to find arbitration agreement “hidden” despite

the fact that it was buried within “five other attachments,” primarily because “the

agreement was clearly labeled,” its terms “were in normal typeface and font,” and

the provision “was only one page long”); Benfield, 884 N.E.2d at 23 (finding no

procedural unconscionability, even though the contract was pre-printed and the

arbitration provision was offered on take-it-or-leave-it basis, where provision

“appeared in standard, rather than fine, print and was not hidden”).

      Furthermore, there is no support in Washington or Ohio law for the

contention that a consumer may not be bound by a term contained within a

standardized adhesion contract merely because he has not been offered an

opportunity to opt out of that provision. See, e.g., Townsend v. Quadrant Corp.,

224 P.3d 818, 827–28 (Wash. Ct. App. 2009) (finding the fact that arbitration

provision “was a boilerplate provision and could not be deleted from the

agreement” to be “insufficient to establish procedural unconscionability”);

                                          30
                Case: 15-10779        Date Filed: 09/26/2017         Page: 31 of 55

Benfield, 884 N.E.2d at 24 (concluding that at-issue contract was adhesive in light

of “stronger party’s refusal to negotiate [the] key term” of arbitration, but declining

nonetheless to find procedural unconscionability given the advantages of form

contracts and the fact that few such contracts “are negotiated one clause at a time”)

(citing Carbajal v. H&R Block Tax Servs., Inc., 372 F.3d 903, 906 (7th Cir. 2004)).

       We conclude that the manner in which Johnson assented to the 1997

Agreement and its terms was procedurally conscionable under both Washington

and Ohio law. 12

               ii.     Johnson’s Failure to Opt Out of the 2004 Amendment to the
                       Arbitration Provision

       Johnson further challenges the conscionability of KeyBank’s 2004

amendment to the arbitration provision. First, we note that even if his argument on

this point had merit, it would not relieve him of his obligation to arbitrate in light

of our findings, supra, that Johnson is bound by the arbitration provision contained

12
    We are mindful of the Supreme Court’s instruction that, “unless the challenge is to the
arbitration clause itself, the issue of the contract’s validity is considered by the arbitrator in the
first instance.” Buckeye, 546 U.S. at 446. See also Solymar Invs., Ltd. v. Banco Santander S.A.,
672 F.3d 981, 998 (11th Cir. 2012) (confirming that broad challenges to the formation of
agreement as a whole—as opposed to specific challenges to arbitration provision contained
therein—must be decided by the arbitrator and not the court). We have found only that the
arbitration provision contained in the 1997 Agreement is not procedurally unconscionable. To
the extent Johnson attacks the execution of the 1997 Agreement as a whole as procedurally
unconscionable, we leave his challenge for the determination of the arbitrator.

                                                  31
             Case: 15-10779    Date Filed: 09/26/2017   Page: 32 of 55

in the 1997 Agreement and that the manner in which he agreed to it was

procedurally conscionable. At most, his argument would invalidate the 2004

amendment—not the agreement to arbitrate itself. Nonetheless, we conclude that

the 2004 amendment to the arbitration agreement was carried out in a procedurally

conscionable manner.

      Johnson’s June 2004 account statement, which KeyBank sent directly to

Johnson’s mailing address, enclosed a document entitled “Information About Your

Accounts.” Printed on that document was a series of messages clarifying key

terms of the account. The first page of the document bears the following text:

      NOTICE OF AMENDMENT TO DEPOSIT ACCOUNT
      AGREEMENT AND FUNDS AVAILABILITY POLICY

      This notice informs you of changes to the Deposit Account Agreement . . .
      that will be effective and will apply to your Account as of October 1, 2004.
      This Arbitration Provision replaces any existing arbitration provision in your
      Agreement. You have the right to reject the changes to the Agreement as
      explained below.

The notice continues on the next page:

      NOTICE OF AMENDMENT TO DEPOSIT ACCOUNT
      AGREEMENT AND FUNDS AVAILABILITY POLICY (continued)

      The enclosed Arbitration provision will apply to your Account(s) unless you
      notify us in writing by November 1, 2004 that you reject the Arbitration
      Provision. . . . Rejection of this Arbitration Provision does not serve as
      rejection of any other term or condition of your Agreement with us
      governing your Account(s). Your continued use of your Account(s) is

                                         32
             Case: 15-10779    Date Filed: 09/26/2017    Page: 33 of 55

      deemed to be your acceptance of this amendment, unless you opt-out as
      described above.

Enclosed with the statement message was a pamphlet titled “KeyBank Arbitration

Provision.” The cover of the pamphlet bears the following text:

       NOTICE OF RIGHT TO REJECT ARBITRATION PROVISION.
       PLEASE SEE YOUR STATEMENT FOR IMPORTANT INFORMATION
       CONCERNING YOUR RIGHT TO REJECT THIS ARBITRATION
       PROVISION. PLEASE RETAIN THIS DOCUMENT FOR YOUR
       RECORDS.

The remaining two pages of the pamphlet print in full the amended arbitration

agreement that KeyBank sought to incorporate into its deposit account agreement.

      Together, this informational sheet and pamphlet comprise the 2004

Statement Message, which KeyBank mailed to Johnson along with his account

statement in June 2004. The deposit account agreement thus authorized KeyBank

to make unilateral amendments as long as notice was provided to accountholders

through precisely this sort of “statement message.”

      In short, there is no viable argument under Washington or Ohio law that

KeyBank’s use of the 2004 Statement Message was procedurally unconscionable.

The bold and capitalized type in which the amendment was announced is sufficient

in Washington and Ohio to alert a consumer to the existence and importance of an

arbitration provision. See, e.g., Zuver, 103 P.3d at 761; Benfield, 884 N.E.2d at 23.

No element of the amendment was concealed from Johnson’s view or “buried” in

                                         33
             Case: 15-10779    Date Filed: 09/26/2017   Page: 34 of 55

voluminous documentation. The opt-out instructions and text of the amendment

itself were complete and presented in ordinary, not “fine,” print. Johnson had

ample time to review the amendment, understand its terms, and consult counsel

before the amendment took effect. Furthermore, the existence of an opt-out

provision strongly weighs against a finding of procedural unconscionability. See,

e.g., Mayne v. Monaco Enters., Inc., 361 P.3d 264, 268 (Wash. Ct. App. 2015)

(finding that arbitration agreement was “not adopted in an unconscionable manner”

under Washington law because a thirty-day opt-out provision “ensured that

[employee’s] decision to sign the arbitration agreement was a voluntary and

meaningful choice”).

      In light of the text of the 2004 Statement Message and its opt-out procedure,

the 2004 amendment to the arbitration provision was not enacted in a procedurally

unconscionable manner under applicable law. Nor does Johnson argue that any

subsequent transactions with KeyBank were procedurally unconscionable. As

such, he has not shown any procedural unconscionability with respect to the

currently operable 2009 Arbitration Provision, which encompasses the changes

made in 2004. Thus, as the 2009 Arbitration Provision is not procedurally

unconscionable, it passes muster under Ohio law.

            2.     Substantive Unconscionability

                                        34
             Case: 15-10779     Date Filed: 09/26/2017    Page: 35 of 55

      Even though the 2009 Arbitration Provision is not procedurally

unconscionable under Washington law, we must still determine whether it is

substantively unconscionable, as Washington law will invalidate a contractual

provision if it is either procedurally or substantially unconscionable.

      Washington courts, like many other courts, invoke a series of hazy

expressions to pinpoint the concept of substantive unconscionability: A term that

is “one-sided,” “shocking to the conscience,” “overly harsh,” “monstrously harsh,”

or “exceedingly calloused” may be substantively unconscionable in Washington.

See Gandee, 293 P.3d at 1199–200 (citing Adler v. Fred Lind Manor, 103 P.3d

773, 781 (Wash. 2004)) (internal quotation marks and brackets omitted). These

attributes must be examined in light of all the circumstances present at the time the

contract was formed. See, e.g., Kam-Ko Bio-Pharm Trading Co. Ltd-Australasia

v. Mayne Pharma (USA) Inc., 560 F.3d 935, 940–41 (9th Cir. 2009) (noting that,

under Washington law, “the relevant clause must be substantively unconscionable

at the time of contracting”) (citing M.A. Mortenson Co. v. Timberline Software

Corp., 998 P.2d 305, 315 (Wash. 2000) and Adler, 103 P.3d at 788). Finally,

unconscionable terms are severed from the applicable agreement wherever

possible. Woodward v. Emeritus Corp., 368 P.3d 487, 496 (Wash. Ct. App. 2016)

(citing Gandee, 293 P.3d at 1201–02).

                                          35
              Case: 15-10779     Date Filed: 09/26/2017    Page: 36 of 55

      Johnson characterizes five distinct elements of the 2009 Arbitration

Provision as substantively unconscionable. With one exception, we disagree with

his characterizations. Nevertheless, this one “unconscionable” clause is readily

severable from the broader agreement to arbitrate and thus does not defeat

KeyBank’s motion to compel.

             i.     Arbitration Costs

      While the parties devote the majority of their substantive-unconscionability

arguments to the issue of arbitration costs, neither party paints a clear picture of the

cost-allocation framework that would apply to Johnson’s claims. We start by

clarifying that picture.

      The allocation of costs under the 2009 Arbitration Provision depends in part

on the arbitral forum in which the claim is brought. Specifically, any claim

brought under the Provision is to be administered by either the American

Arbitration Association (the “AAA”) or Judicial Arbitration and Mediation

Services, Inc. (“JAMS”) according to the rules in place at the chosen forum “at the

time the Claim is filed.” The consumer has complete power to select which

organization will administer the arbitration, regardless of whether he initiates the

                                          36
               Case: 15-10779       Date Filed: 09/26/2017      Page: 37 of 55

arbitration himself or KeyBank compels arbitration of a claim that he initially filed

in court.13

       In either scenario, the 2009 Provision reduces the consumer’s filing-fee

burden and limits his expected costs of arbitration. First, it provides that KeyBank

will reimburse the claimant “all fees up to $100.00 charged by the arbitration

administrator” once the claimant has paid an amount equivalent to the applicable

court filing fee. All the consumer must do is make a written request for

reimbursement. Second, it provides that:

       If you are required to pay any fees in excess of $100.00 to the arbitration
       administrator [ ], we will consider a request by you to pay all or part of the
       additional fees. To the extent that we do not approve your request, the
       arbitrator will decide whether we or you will be responsible for paying any
       such additional fees.

       An illustration is helpful. The parties do not dispute that, if Johnson chose

to arbitrate via JAMS, the JAMS Consumer Arbitration Policy that became

effective in July 2009 would apply. 14 That policy articulates the following

13
   Even if KeyBank seeks to initiate arbitration against the consumer, the consumer has twenty
days to select which forum he would like KeyBank to use. The consumer therefore has
significant control over the choice of forum.
14
   The parties dispute which version of the AAA rules would apply and how such rules would
impact the allocation of costs. We focus only on JAMS rules for purposes of this example, but
we note that we see no evidence in the record that AAA rules regarding consumer cost allocation
differ meaningfully from JAMS rules.

                                              37
             Case: 15-10779     Date Filed: 09/26/2017    Page: 38 of 55

“minimum standard of fairness”: “[T]he only fee required to be paid by the

consumer is $250, which is approximately equivalent to current Court filing fees.

All other costs must be borne by the company including any remaining JAMS Case

Management Fee and all professional fees for the arbitrator’s services.” In fact,

JAMS will not administer any consumer arbitration unless fees are allocated in

accordance with this standard. The 2009 Arbitration Provision provides contact

information for each arbitral forum so that consumers can access and read rules

like this one before they decide where to bring their claims.

      Thus, had Johnson pursued his claim against KeyBank in arbitration under

the applicable JAMS rules, he would have been required to pay only $150: the

$250 consumer filing fee collected by JAMS, less the $100 reimbursement from

KeyBank to which he is entitled under the Arbitration Provision. This is a lesser

financial outlay than the $350 he was required to pay to file a civil action in the

Western District of Washington.

      In short, the cost of using the JAMS arbitral forum is absolutely capped at

the initial filing fee, as JAMS rules shield consumers entirely from “all other costs”

of arbitration, including the arbitrator’s professional fees. Such costs would be

borne exclusively by KeyBank. The consumer’s option to negotiate with KeyBank

                                          38
              Case: 15-10779       Date Filed: 09/26/2017      Page: 39 of 55

for additional reimbursement and to appeal to the arbitrator for the same further

reduces the expected cost of access to the JAMS forum.

       Johnson has not argued that JAMS is an unsuitable or unfavorable arbitral

forum. In fact, there is no reason to believe that a consumer contemplating a

dispute with KeyBank would have reason to be concerned about the JAMS cost-

allocation framework, given its limitations and predictability. Even if the AAA

rules imposed a prohibitive cost-allocation framework, 15 the consumer deciding

where to pursue his claim would be empowered and properly incentivized to

choose JAMS instead. Moreover, under the terms of the 2009 Provision, the

consumer is not exposed to the risk of “loser pays” cost shifting: If KeyBank

prevails, the consumer is “not required to reimburse [KeyBank]” for any fees paid

regardless of which organization administers the dispute.

       With no mention of the JAMS rules we have discussed here, Johnson argues

that the costs associated with arbitrating his case would be prohibitive and render

the 2009 Arbitration Provision unconscionable. The district court agreed, relying

on the erroneous assumption that neither the AAA nor the JAMS rules impose any

15
   To reiterate, the parties dispute which AAA rules would apply in Johnson’s case, and we
make no finding as to the applicable AAA cost-allocation framework. But again, we see no
evidence to suggest that such rules would prohibit a consumer’s access to the AAA forum.

                                              39
             Case: 15-10779     Date Filed: 09/26/2017    Page: 40 of 55

predictable limit on the costs Johnson would face in arbitration. Instead, the court

assumed, the arbitrator would enjoy full discretion to allocate costs as he or she

sees fit, and this potential unpredictability would be “enough to deter a plaintiff

from bringing an individual claim.” Even if this were true under AAA rules, the

district court’s position does not square with the straightforward JAMS rule

framework, which would force KeyBank to pay the bulk of arbitration costs and

would strictly limit Johnson’s personal outlay.

      We also note that the JAMS Consumer Arbitration Policy took effect five

months before the 2009 Arbitration Provision was formed. This means that, “at the

time of contracting,” the 2009 Provision provided Johnson with a clear opportunity

to pursue arbitration in a cost-feasible manner. Further, the time of contracting is

the only point in time that matters in substantive unconscionability analysis under

Washington law. See Kam-Ko Bio-Pharm Trading, 560 F.3d at 940–41.

      Given that arbitrating under JAMS rules has been an option for Johnson

since 2009, the cost-sharing aspects of the 2009 Arbitration Provision cannot be

characterized as harshly one-sided or prohibitive under Washington law. Cf., e.g.,

Gandee, 293 P.3d at 1200–01 (invalidating “loser pays” provision because the risk

that costs might shift to the consumer in the event his claim failed “effectively

                                          40
             Case: 15-10779      Date Filed: 09/26/2017   Page: 41 of 55

chill[ed]” his willingness to bring suit; as a result, the provision was “one-sided

and overly harsh”).

      Furthermore, under Washington law, the party challenging a fee-splitting

provision must provide specific information about the arbitration fees it would be

required to pay and describe why those fees would be prohibitive. See Hill v.

Garda CL Nw., Inc., 308 P.3d 635, 639 (Wash. 2013). Johnson has provided no

reason why he is unable to take advantage of the favorable cost-allocation

framework provided by JAMS rules, and there is no evidence to suggest that a cost

of $150 would prohibit Johnson from pursuing his claim in arbitration at this stage.

There are, therefore, no grounds on which to hold this provision substantively

unconscionable.

             ii.      Attorneys’ Fees

      Johnson also challenges the attorneys’ fees clause of the 2009 Arbitration

Provision, which provides that “[e]ach party shall bear the expense of that party’s

attorneys’, experts’, and witness fees, regardless of which party prevails in the

arbitration, unless applicable law and/or this Agreement gives a party the right to

recover any of those fees from the other party.”

      This clause tracks the “American rule” of fee splitting, which Washington

courts have long embraced. Cosmopolitan Eng’g Grp., Inc. v. Ondeo Degremont,

                                          41
             Case: 15-10779     Date Filed: 09/26/2017   Page: 42 of 55

Inc., 149 P.3d 666, 669 (Wash. 2006) (“[T]he general rule in Washington,

commonly referred to as the American rule, is that each party in a civil action will

pay its own attorney fees and costs.”). Johnson has not provided any evidence that

any “applicable law” or any other element of the 2009 Agreement would entitle

KeyBank to recover attorneys’ fees from Johnson. As a result, we do not find the

attorneys’ fees clause unconscionable under Washington law.

             iii.   Discovery

      A discovery clause in the 2009 Arbitration Provision states: “There shall be

no pre-arbitration discovery except as provided for in the applicable Arbitration

Rules”—that is, the rules of the AAA or JAMS, depending on Johnson’s election.

Johnson argues that the discovery clause is “severely one-sided” because KeyBank

has “all” the documents necessary for Johnson to prove his claims.

      We start with AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011), in

which the Supreme Court cautioned that clauses limiting discovery in arbitration—

much like class-action waivers—cannot be rejected as categorically

unconscionable under state law without running afoul of the FAA’s pro-arbitration

mandate. See id. at 339, 341–44. Even if the clause at issue here limited

Johnson’s discovery options in a meaningful way, it would not be substantively

unconscionable on that basis alone.

                                         42
               Case: 15-10779       Date Filed: 09/26/2017       Page: 43 of 55

       In fact, KeyBank’s discovery clause does not limit discovery in any

meaningful way. We first reiterate that, under the 2009 Provision, Johnson is

entitled to choose whether AAA or JAMS rules (and their accompanying discovery

procedures) apply. He contends that discovery would be unfavorably limited only

under the AAA rules, failing (again) to mention the alternative JAMS framework.

In fact, under its Consumer Arbitration Policy, JAMS refuses to administer any

arbitration that would not allow for the discovery of information relevant to the

dispute. Johnson remains free to proceed under this JAMS rule if he so chooses.

       Furthermore, even under the AAA rules, and contrary to Johnson’s assertion,

discovery in that forum would be conducted at the discretion of the arbitrator, who

is instructed by the AAA Consumer Due Process Protocol that “No party should

ever be denied the right to a fundamentally-fair process due to an inability to

obtain information material to a dispute.”16

       In short, nothing in the record suggests that an arbitrator applying AAA or

JAMS rules would be empowered to limit discovery in a manner that would render

16
   Johnson incorrectly contends that, under the applicable AAA rules, he “would not be entitled
to any discovery other than KeyBank’s exhibit list.” This assertion is simply not supported by
the text of the AAA rules. Those rules provide: “At the request of any party or at the discretion
of the arbitrator . . . the arbitrator may direct [ ] the production of documents and other
information.” Even if the AAA’s streamlined “Expedited Procedures” for consumer cases were
to apply, they do not modify or replace this baseline discovery rule.

                                               43
             Case: 15-10779       Date Filed: 09/26/2017   Page: 44 of 55

the Provision unconscionable. Cf., e.g., Cockerham v. Sound Ford, Inc., No. C06-

1172JLR, 2006 WL 2841881, at *3 (W.D. Wash. Sept. 29, 2006) (declining to find

discovery clause that allowed each side to take one deposition and granted

discretion as to remaining discovery to arbitrator unconscionable under

Washington law).

      Finally, Johnson’s concern that KeyBank holds “all” the evidence relevant to

the dispute seems overstated. That is, Johnson’s substantive claims relate to the

temporal ordering of debit-card transactions within the Joint Account, and Johnson

could conceivably make his case on the basis of account records alone. As such,

the scope of discovery necessary in this case may, in reality, prove minimal—and

Johnson is likely already in possession of the critical account records. Leaving

discovery procedures to the discretion of the arbitrator is not substantively

unconscionable in theory, and would not be so in practice.

             iv.    Unilateral Right to Amend Arbitration Provision

      Each version of the KeyBank deposit account agreement since Johnson

opened the Joint Account has included a change-in-terms provision. The current

version reads in relevant part:

      We reserve the right to change or add to the terms and conditions of this
      Agreement or change the terms of your Account at any time. We will give
      you such notice of the change as we determine is appropriate, such as by

                                           44
               Case: 15-10779        Date Filed: 09/26/2017       Page: 45 of 55

       statement message or enclosure, letter, or as posted in the branch, and as
       required under applicable law.

Johnson argues that, as applied to the 2009 Arbitration Provision, KeyBank’s

ability to unilaterally change the terms of agreement is so “lopsided” as to be

substantively unconscionable. The district court did not address this issue. We

consider the change-in-terms provision only as it applies to the 2009 Arbitration

Provision itself. See Buckeye, 546 U.S. at 446 (“Unless the challenge is to the

arbitration clause itself, the issue of the contract’s validity is considered by the

arbitrator in the first instance.”).

       Washington courts have not directly confronted an unconscionability

challenge to a provision like this one. 17 We are, however, guided by a recent

opinion of the Southern District of California, which applied Washington law to

uphold a much less symmetrical provision than the one at hand. In Fagerstrom v.

Amazon.com, Inc., 141 F. Supp. 3d 1051 (S.D. Cal. 2015), appeal pending, No. 15-

56799 (9th Cir. Nov. 23, 2015), the court considered a unilateral change-in-terms

provision found in Amazon.com’s “conditions of use,” to which customers of the

17
    KeyBank cited some Washington case law in defense of the change-in-terms provision, but its
cases spoke only to the illusoriness of the provision. The question whether a contractual
provision is substantively unconscionable is distinct from the question whether it is illusory, even
if their analyses overlap. KeyBank did not cite any case law directly addressing the
unconscionability of change-in-terms provisions.

                                                45
             Case: 15-10779     Date Filed: 09/26/2017    Page: 46 of 55

site must consent before making an online purchase. Id. at 1057–58. The

provision stated simply that Amazon “reserve[s] the right to make changes to . . .

these Conditions of Use at any time.” Id. at 1058.

      Applying Washington law, the court concluded that the provision was

neither “unfairly one-sided” nor “overly harsh”—and therefore not substantively

unconscionable under Washington law—for two reasons. Fagerstrom, 141

F. Supp. 2d at 1071. First, “the performance obligations for both parties, including

the core obligation to arbitrate disputes, [were] fixed” and could not be

significantly modified at Amazon’s whim, notwithstanding the language of the

change-in-terms provision. Id. at 1071. Second, Amazon remained bound by the

implied duty of good faith and fair dealing, which required Amazon to “exercise its

discretion in a manner consistent with the justified expectations of the parties.” Id.

      We find the court’s reasoning in Fagerstrom persuasive and equally

applicable to this case. That is, applying the phraseology used in Washington

caselaw, we find the provision neither “one-sided,” “shocking to the conscience,”

“overly harsh,” “monstrously harsh,” or “exceedingly calloused.” See Gandee,

293 P.3d at 1199–200. Here, as in Fagerstrom, KeyBank’s commitment to

arbitrate is fixed and cannot be eliminated at KeyBank’s whim. Furthermore, its

right to unilaterally amend the terms of arbitration is limited by both the

                                          46
               Case: 15-10779    Date Filed: 09/26/2017   Page: 47 of 55

requirement to provide “appropriate” notice and the implied duty of good faith and

fair dealing. See Rekhter v. State, Dep’t of Soc. & Health Servs., 323 P.3d 1036,

1041 (Wash. 2014). To be sure, KeyBank’s change-in-terms provision is

asymmetrical by design. But asymmetry alone does not amount to substantive

unconscionability under Washington law. See Satomi Owners Ass’n v. Satomi,

LLC, 225 P.3d 213, 232 (Wash. 2009) (declining to find substantively

unconscionable a forum-selection clause that gave drafting party the sole option to

require arbitration, despite the absence of mutuality). In short, neither this Court

nor a court of Washington would be justified in finding the change-in-terms

provision here unconscionable.

               v.    Confidentiality

         Johnson further challenges a confidentiality clause contained in the 2009

Arbitration Provision, which requires both parties to “keep confidential any

decision of an arbitrator.” Johnson argues that this provision “disproportionately

favors KeyBank as a repeat participant in the arbitration process.” The district

court agreed, emphasizing the risk that KeyBank’s “one-sided access to

information” from prior arbitrations might “discourage a plaintiff from bringing a

suit.”

                                           47
             Case: 15-10779     Date Filed: 09/26/2017   Page: 48 of 55

      We agree that under Washington law, KeyBank’s confidentiality clause

would likely be considered substantively unconscionable under the reasoning of

Zuver v. Airtouch Communications, Inc., 103 P.3d 753 (Wash. 2004). In that case,

the Washington Supreme Court invalidated a confidentiality clause covering “[a]ll

arbitration proceedings” between an employer and its employees. Id. at 765, 765

n.9. We acknowledge that Zuver is not perfectly analogous to the case at hand.

First, Zuver dealt with arbitration of an employment discrimination claim, rather

than a consumer dispute in the commercial context. Second, the clause at issue in

Zuver purported to shroud the entire arbitral process in secrecy. By contrast,

KeyBank’s clause prohibits disclosure only of ultimate decisions by an arbitrator.

KeyBank’s clause “does not prevent consumers from sharing discovery, fact

patterns, or briefing from other similar arbitrations.” Thus, the provision at issue

in Zuver ensured far more secrecy than the provision here.

      The court’s reasoning in Zuver does, however, highlight a core public-policy

concern that applies with equal force to this case. The court explained:

      The effect of the provision here benefits only [the employer]. As written,
      the provision hampers an employee’s ability . . . to take advantage of
      findings in past arbitrations. Moreover, keeping past findings secret
      undermines an employee’s confidence in the fairness and honesty of the
      arbitration process and thus, potentially discourages that employee from
      pursuing a valid [ ] claim.

                                          48
             Case: 15-10779      Date Filed: 09/26/2017   Page: 49 of 55

Id. at 765. In rejecting the broad confidentiality clause at issue in Zuver, the court

focused its concern on the consequences of secretive outcomes: That is, without

the guidance of prior arbitral decisions, future claimants are less able to assess the

viability of their claims. In turn, they cannot accurately measure the costs of

dispute resolution against its benefits.

      Thus, following what we perceive to be the approach under Washington law,

the non-disclosure provision here is a problem. To be sure, the arbitration

agreement provides access to non-decisional information concerning the arbitral

process of previous arbitrations, such as discovery and briefing; and this

information can minimize duplicative efforts and could shed light on patterns of

misconduct against consumers. Cf. McKee, 191 P.3d at 858 (“Secrecy conceals [ ]

patterns of illegal or abusive practices” and “hampers plaintiffs in learning about

potentially meritorious claims.”). But where the outcomes of prior arbitration

proceedings themselves remain concealed, as the arbitration agreement requires,

prospective claimants have little context in which to assess the value of discovered

documents or work product from prior disputes. Consumers may be relieved from

“reinventing the wheel” when it comes to collecting evidence and crafting

arguments, see id. at 858 (observing that, when all elements of the arbitration

process are confidential, consumers are forced to “reinvent the wheel in each and

                                           49
               Case: 15-10779        Date Filed: 09/26/2017       Page: 50 of 55

every claim”), but they cannot avoid repeating past claimants’ mistakes—nor can

they leverage prior successes—if they have no insight into dispute outcomes. And

whether this would be unconscionable under other states’ laws, Zuver suggests that

the confidentiality provision here would not be countenanced by Washington law.

       The obvious informational advantage KeyBank holds at the outset of a

dispute may therefore have the effect of discouraging consumers from pursuing

valid claims. We thus conclude that under Washington law, the confidentiality

clause here is substantively unconscionable. See Zuver, 103 P.3d at 765.

Nonetheless, under Washington law, “[s]everance is the usual remedy for

substantively unconscionable terms.” Woodward, 368 P.3d at 496 (citing Gandee,

293 P.3d at 1201–02). Where unconscionable terms “pervade an arbitration

agreement” such that severance would “significantly alter” the tone and nature of

arbitration, the court should “declare[] the entire agreement void.” Id. Washington

courts also give weight to severance clauses contained in arbitration agreements.

See Zuver, 103 P.3d at 768. The 2009 Arbitration Provision contains such a

clause.18

18
   The operable severance clause states: “If any portion of this Arbitration Provision is deemed
invalid or unenforceable under any law or statute consistent with the FAA, it shall not invalidate
the remaining portions of this Arbitration Provision or the Agreement.”

                                                50
                 Case: 15-10779        Date Filed: 09/26/2017     Page: 51 of 55

         The confidentiality clause in this case is limited in its scope: it purports only

to shield arbitrators’ decisions from disclosure, while other information concerning

the arbitral process may be disclosed. Severing this clause will not “significantly

alter” the tone or nature of arbitration between Johnson and KeyBank. Cf., e.g., id.

(concluding that broad confidentiality clause was “easily excise[d]” from the

remainder of the agreement to arbitrate, especially since agreement contained

severance clause). As such, we sever the confidentiality clause contained in the

2009 Arbitration Provision and enforce the remainder of the Provision in

accordance with this opinion.

         C.      Lack of Mutuality

         Johnson finally argues that the change-in-terms provision renders the 2009

Arbitration Provision illusory and therefore unenforceable.19 We consider

Johnson’s contention under both Washington and Ohio law and find his argument

unpersuasive under either. As before, we consider the change-in-terms provision

19
     Recall that the change-in-terms provision states:

         We reserve the right to change or add to the terms and conditions of this Agreement or
         change the terms of your Account at any time. We will give you such notice of the
         change as we determine is appropriate, such as by statement message or enclosure, letter,
         or as posted in the branch, and as required under applicable law.

                                                  51
              Case: 15-10779     Date Filed: 09/26/2017     Page: 52 of 55

only as it applies to the 2009 Arbitration Provision itself. See Buckeye, 546 U.S. at

446 (“Unless the challenge is to the arbitration clause itself, the issue of the

contract’s validity is considered by the arbitrator in the first instance.”).

      Under both Washington and Ohio law, illusoriness arises when there is a

lack of mutuality. Washington courts apply two principles to assess whether

contractual obligations are truly mutual. First, under Washington law, “a contract

is illusory only if it lacks all consideration and mutuality of obligation, e.g., the

promisor has no obligations with regard to any parts of the contract.” Ekin v.

Amazon Servs., LLC, 84 F. Supp. 3d 1172, 1176 (W.D. Wash. 2014) (citing

Quadrant Corp. v. Am. States Ins. Co., 110 P.3d 733, 743–44 (Wash. 2005)).

Where the parties’ performance obligations remain fixed and only the manner or

quality of performance is discretionary, the contract is not illusory. See, e.g.,

Cascade Auto Glass, Inc. v. Progressive Cas. Ins. Co., 145 P.3d 1253, 1258

(Wash. Ct. App. 2006) (declining to find contract illusory even though consumer

only committed to paying a “fair” price because “both parties clearly intended the

[ ] agreement to be binding”).

      Second, Washington courts rely on the implied duty of good faith and fair

dealing to ensure mutuality of obligations where performance is discretionary. See

Rekhter, 323 P.3d at 1041 (“Under Washington law, there is in every contract an

                                           52
             Case: 15-10779     Date Filed: 09/26/2017   Page: 53 of 55

implied duty of good faith and fair dealing that obligates the parties to cooperate

with each other so that each may obtain the full benefit of performance.”) (internal

quotation marks and alterations accepted).

      Ohio law applies the same two principles in the same manner. See Domestic

Linen Supply & Laundry Co. v. Kenwood Dealer Grp., Inc., 672 N.E.2d 184, 186

(Ohio Ct. App. 1996) (In Ohio, “[a] contract is illusory only when by its terms the

promisor retains an unlimited right to determine the nature or extent of his

performance.”) (internal quotation marks omitted); Illinois Controls, Inc. v.

Langham, 639 N.E.2d 771, 778 (Ohio 1994) (implying duty of good faith and

reasonable efforts to conclude that discretionary promise to perform was “neither

illusory nor indefinite”).

      Johnson argues that KeyBank holds “unfettered,” “unlimited,” and

“absolute” control over the 2009 Arbitration Provision and can “revise or undo”

the Provision “at its whim.” This is not an accurate characterization of the change-

in-terms provision, which specifically obligates KeyBank to provide consumers

with notice prior to making any amendment. Moreover, this notice must be

“appropriate” in KeyBank’s estimation. In Washington and Ohio, this

commitment to provide notice is accompanied by an implied duty of good faith and

fair dealing, which would guide any court’s assessment of whether the notice

                                         53
             Case: 15-10779     Date Filed: 09/26/2017   Page: 54 of 55

provided by KeyBank was truly “appropriate.” KeyBank is thus bound by a

commitment not just to provide prior notice of a change, but to ensure that this

notice is executed in good faith and in fairness to the affected consumers.

KeyBank’s power to amend the Provision is therefore not unfettered, unlimited, or

absolute.

      Further, the change-in-terms provision does not empower KeyBank to

“rescind the [Provision] at any time,” as Johnson suggests. It explicitly permits

only changes or additions to the 2009 Agreement. The agreement to arbitrate is

fixed and is a core component of the 2009 Agreement; only the terms defining the

nature of arbitral proceedings are subject to alteration. Cf., e.g., Fagerstrom, 141

F. Supp. 3d at 1065 (declining to presume that a broad, boilerplate change-in-terms

provision could be used to “nullify a core obligation” of the contract). KeyBank is

not empowered to simply evade the commitment to arbitrate at its whim.

      Because the commitment to arbitrate is fixed and KeyBank is bound by the

duty of good faith and fair dealing in making alterations and providing appropriate

notice, the change-in-terms provision does not render the 2009 Arbitration

Provision illusory under Washington or Ohio law.

                                  CONCLUSION

                                          54
             Case: 15-10779     Date Filed: 09/26/2017   Page: 55 of 55

      For the above reasons, we REVERSE the district court’s order to the extent

described in this opinion and REMAND the case to the district court with

instructions to compel arbitration.

                                         55