Stover v. Experian Holdings, Inc., No. 19-55204 (9th Cir. 2020)
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The Ninth Circuit affirmed the district court's order compelling arbitration in an action brought by plaintiff, seeking damages and injunctive relief under the Fair Credit Reporting Act and state law. Plaintiff's claims arose from her purchase of the Experian Credit Score subscription service in 2014. Two versions of the Experian terms of use are at issue: the version to which plaintiff expressly agreed in 2014, and the 2018 version, which exempted some types of claims from binding arbitration.
The panel held that a mere website visit after the end of a business relationship is not enough to bind parties to changed terms in a contract pursuant to a change-of-terms provision in the original contract. In this case, plaintiff's claims are arbitrable under the 2014 terms of the contract to which she assented. The panel held that, in order to bind parties to new terms pursuant to a change-of-terms provision, consistent with basic principles of contract law, both parties must have notice that the terms have changed and an opportunity to review the changes. Because plaintiff has not alleged that she had such an opportunity, the panel concluded that the 2018 terms did not form a valid contract. Furthermore, the contract permits judicial resolution of claims for public injunctive relief, but plaintiff has not alleged Article III standing for such a claim. Therefore, the panel concluded that the McGill rule does not excuse plaintiff from binding arbitration of her claims against Experian.
Court Description: Arbitration The panel affirmed the district court’s order compelling arbitration in an action seeking damages and injunctive relief under the Fair Credit Reporting Act and state law based on plaintiff’s purchase of the Experian Credit Score subscription service in 2014. Plaintiff expressly agreed in 2014 to the Experian terms of use, which included an arbitration provision and a “change-of-terms” provision, specifying that she would be bound to future versions of the contract by continuing to use Experian products, which, under the terms of the contract, included accessing Experian’s website. The 2018 version of the terms of use exempted some types of claims from binding arbitration. In 2018, plaintiff accessed Experian’s website, but she did not allege that she received notice of the terms then in effect. The panel held that plaintiff’s claims were arbitrable under the 2014 terms of the contract to which she assented. It held that in order to bind parties to new terms pursuant to a change-of-terms provision, consistent with basic principles of contract law, both parties must have notice that the terms have changed and an opportunity to review the changes. Because plaintiff did not allege facts sufficient to conclude that the 2018 terms formed a valid contract, the 2018 terms did not form a valid contract. STOVER V. EXPERIAN HOLDINGS 3 The panel further held that the parties’ contract permitted judicial resolution of claims for public injunctive relief, but the plaintiff did not allege Article III standing to bring such a claim. Accordingly, the McGill rule, providing that a contract that purports to waive a person’s right to seek public injunctive relief in court is unenforceable under California law, did not excuse her from binding arbitration of her claims against Experian.
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