Thursday, January 31, 2013

CompuCredit Corp. v. Greenwood case brief

CompuCredit Corp. v. Greenwood 132 S. Ct. 665

PROCEDURAL HISTORY: Respondent consumers filed a class action against petitioners, a credit corporation and a bank, claiming that petitioners violated the Credit Repair Organizations Act (CROA), 15 U.S.C.S. § 1679 et seq. The district court denied petitioners' motion to compel arbitration, and the U.S. Court of Appeals for the Ninth Circuit affirmed. The U.S. Supreme Court granted certiorari.

FACTS: The consumers applied for credit cards marketed by a corporation and issued by a bank, and they signed agreements that required them to resolve any claim, dispute, or controversy relating to their account by binding arbitration. The consumers filed a class action against the corporation and the bank, claiming that they were charged fees that reduced their credit limit and were misled when they were told they could use the credit card to rebuild poor credit, and the district court denied the corporation and bank's motion for an order requiring the consumers to submit their claims to arbitration. The Supreme Court found that because the CROA was silent on whether claims under the CROA could be resolved by arbitration, the Federal Arbitration Act required that the arbitration agreements the consumers signed be enforced according to their terms.

HOLDING:
The Court rejected the consumers' claim that because 15 U.S.C.S. § 1679c gave consumers the "right to sue" and 15 U.S.C.S. § 1679f prohibited the waiver of any right consumers had under the CROA, the arbitration agreements in question were not enforceable. Section 1679c did not give consumers the right to bring an action in a court of law.

CONCLUSION: The Supreme Court reversed the Ninth Circuit's judgment and remanded the case. 8-1 Decision; 2 concurrences; 1 dissent.

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