MEMORANDUM OPINION AND ORDER
ROBERT W. GETTLEMAN, District Judge.
Plaintiffs Steve Bayer and Aaron Lloyd (collectively, "plaintiffs"), individually and on behalf of all others similarly situated, brought a collective and putative class action complaint against defendant Comcast Corporation, alleging violations of § 551(a) and (e) of the Cable Communication Policy Act ("CCPA"), 47 U.S.C. § 551, et seq., (Counts I & II), breach of implied contract (Count III), violation of the Illinois Cable and Video Customer Protection Law ("Illinois Cable Act") (Count IV), violation of the California Customer Records Act ("CCRA"), Cal. Civ. Code § 1798.80, et seq., (Count V), and violation of Cal. Penal Code § 637.5 (Count VI). Defendant has moved, pursuant to Federal Arbitration Act ("FAA"), 9 U.S.C. § 1, et seq., to compel arbitration and stay litigation. Plaintiffs oppose to the motion. For the reasons stated below, defendant's motion is granted.
Defendant is a corporation headquartered in Philadelphia, Pennsylvania, and is the nation's largest cable television operator, serving over twenty million customers. Defendant provides cable and other services to customers in thirty-nine states, including Illinois.
Plaintiff Steve Bayer ("Bayer") is a citizen of Illinois who subscribed to defendant's video and internet services from July 28, 2006, to July 17, 2007, at an apartment in Rolling Meadows, Illinois. According to defendant, Bayer received at least two copies of an arbitration agreement with defendant during that time period. He received his first copy in defendant's standard Welcome Kit when he initiated his service in July 2006, and his second copy in a notice inserted in his November 2006 bill that was mailed to him. Bayer does not deny that he received these agreements.
Plaintiff Aaron Lloyd ("Lloyd") is a citizen of the California who subscribed to defendant's internet service at a residence in Portland, Oregon from July 2, 2008, until September 13, 2010. Like Bayer, Lloyd received a Welcome Kit when he initiated his service on July 2, 2008. The Welcome Kit contained the subscriber agreement, which contained an arbitration agreement with an opt-out provision. After receiving his subscriber agreement, unlike some other subscribers in Portland, Oregon, Lloyd elected not to opt out of the arbitration agreement. Lloyd does not dispute that he received this agreement.
Bayer's and Lloyd's arbitration agreements are substantially similar and state:
Both of the arbitration agreements later define "dispute" to mean "any dispute, claim or controversy between you and Comcast, whether based in contract, statute, regulation, ordinance, tort including, but not limited to fraud, misrepresentation, fraudulent inducement, negligence or any other intentional tort, or any other legal or equitable theory," and includes "the validity, enforceability, or scope of the arbitration provision." The agreements further provide that litigation and arbitration by either party on a class-wide basis is prohibited.
Plaintiffs filed the instant case with this court on October 27, 2012, after both terminated their contracts with defendant. Plaintiffs allege that, after the termination of services with defendant, defendant continues to maintain personally identifiable information on all of its previous customers indefinitely without notifying them, in violation of the CCPA, the CCRA, the Illinois Cable Act and the California Penal Code, and is in breach of an implied contract. In response to plaintiffs' complaint, defendant has moved to compel arbitration, arguing that plaintiffs have agreed that arbitrators, not a court, should adjudicate disputes as defined in the arbitration agreements.
The Federal Arbitration Act, 9 U.S.C. § 1, et seq., ("FAA") puts federal courts in the gatekeeper position of determining whether a dispute is one that the parties intended to arbitrate.
In the instant case, defendant argues that the relevant arbitration agreements are clear and unmistakable evidence that the parties intended an arbitrator to determine the arbitrability of the claims. Plaintiffs acknowledge both that parties may agree to the submission of the arbitrability issue to arbitration and that the definition of "dispute" includes "the validity, enforceability, or scope of the arbitration provision" in their arbitration agreements. Plaintiffs, however, argue that other portions of the parties' agreements demonstrate the parties' intention that a court, not an arbitrator, should determine the scope of the arbitration provision, and there is therefore no "clear and unmistakable evidence" of an agreement on this matter. In support of their argument, plaintiffs point to the jury waiver provision, which states that "if a claim is brought in a Dispute that is found
When one interprets the last sentence quoted by plaintiffs within the context of the clause, it is clear that the parties intended that when a court determines that the court should adjudicate the arbitrality issue, despite the agreement between defendant and plaintiffs, and finds a dispute to fall outside the scope of arbitration, a right to jury trial is waived. The severability clause contains a number of potential scenarios that attempt to provide guidance in the event the arbitration clause is found to be unenforceable. These "if-then" scenarios do not dilute the broad scope of the arbitration provision, which explicitly refers to "all disputes . . . includ[ing] the validity, enforceability or scope of this Arbitration Provision." The arbitration agreements therefore demonstrate an intent to include the arbitrability issue within the scope of arbitration.
In addition to their argument regarding arbitrability, plaintiffs present two other grounds to support their contention that the arbitration agreements should not be enforced: (1) the agreements to arbitrate are contracts of adhesion and therefore indicative of procedural unconscionability; and (2) the arbitration provision is substantively unconscionable. In response, defendant argues that pursuant to the agreement, these arguments are included within the "validity" and enforceability" of the arbitration agreement, which must be submitted to arbitration.
In the instant case, both of plaintiffs' claims alleging procedural and substantial unconscionability are directed at the arbitration agreement as a whole. Plaintiffs allege that the arbitration agreements are contracts of adhesion because the agreements are form contracts, prepared entirely by defendant and offered on a take-it-or-leave-it basis. Plaintiffs further contend that the provision is substantively unconscionable because a number of clauses in the provision favor defendant. Because the delegation clause, which delegates to an arbitrator the authority to determine the enforceability of the arbitration provision, is severable from the rest of the arbitration agreement, plaintiffs' challenge to the arbitration agreement as a whole does not affect the validity of the delegation clause.
For the foregoing reasons, defendant's motion to compel arbitration and stay litigation is granted. The court expects the parties to expeditiously initiate arbitration and have the arbitrability issue decided promptly. The matter is set for a report on status on July 10, 2013, at 9:00 a.m.