Geier v. m-Qube Inc., No. 13-36080 (9th Cir. 2016)
Annotate this CasePow! Mobile (the Company), not a party here, is a mobile content provider that marketed a “reverse auction” game called “Bid and Win.” Both Mobile Messenger and m-Qube (defendants) are “billing aggregators” who serve as financial intermediaries between customers and content providers. Plaintiff filed a class action alleging that defendants have engaged in a scheme “that causes Washington consumers to become unknowingly and unwittingly subscribed to premium text message services.” The district court held that defendants are not intended third-party beneficiaries entitled to enforce the arbitration clause at issue and denied defendants' motion to compel arbitration. The court concluded that the Terms and Conditions in this case create a direct obligation from the subscriber to the Company’s suppliers. The signatory to the Terms and Conditions agrees to waive all claims against the Company’s suppliers. Therefore, the Company’s suppliers are intended third-party beneficiaries of the Terms and Conditions. Thus, if defendants are suppliers of the Company, they may enforce the arbitration clause. The court remanded for the district court to make determinations in the first instance regarding assent to the Terms and Conditions, and whether defendants are Pow! Mobile’s suppliers.
Court Description: Arbitration. The panel reversed the district court’s denial of defendants’ motion to compel arbitration in a class action alleging that defendants engaged in a scheme that caused Washington consumers to become unknowingly and unwittingly subscribed to premium text messages services, and remanded for further proceedings. Defendants are “billing aggregators” who serve as financial intermediaries between customers and content providers. Pow! Mobile, not a party, is a mobile content provider that marketed a game called “Bid and Win,” and is defined as the “Company” in the subscription contract’s Terms and Conditions. Plaintiff’s wife allegedly subscribed to the mobile version of Bid and Win. The panel held that under Washington law, the Terms and Conditions provide that the “Company’s suppliers” are intended third-party beneficiaries of the Terms and Conditions. The panel further held that if defendants are Company’s suppliers, they may enforce the arbitration clause in the Terms and Conditions. The panel remanded for the district court to determine whether plaintiff’s wife assented to the Terms and Conditions, and whether defendants are Pow! Mobile’s suppliers. GEIER V. M-QUBE, INC. 3
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