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Determined1

Arbitration vs. Credit Bureau - combine multiple disputes, or separate complaints?

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Hi,

 

I am planning to file Arbitration under the terms of one of the credit bureaus credit monitoring contracts. It has an Arbitration clause with AAA as the forum. I have multiple trade lines to dispute that this one particular CRA has refused to properly investigate, despite my many letters sent CMRRR.

 

My question is primarily one of strategy. I can combine all of the disputes into one large complaint, which will make the process more manageable. However, I am considering filing separate arbitration demands as they each have slightly different issues and FCRA violations, and the arbitration fees required by the CRA will likely bring them to the table to resolve the dispute. It would be great if anyone has had a similar issue, or can offer some general thoughts on the strategy of a combined claim vs. individual claims.

 

Thanks!

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I don't recall anyone posting about arbitration with a credit bureau.  You may be breaking new ground.

 

My first thought is...you need to be sure that the fine print of your credit monitoring contract extends to disputing tradelines on your actual report.  Offhand, I don't see the connection.

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Hi Willing,

 

Thanks for your reply and Happy Thanksgiving!

 

I've seen a few posts on this, and others have reported this approach with success. Nobody has come forward stating they won a financial award, which I take as either the result of confidentiality agreements, or simply that they cleared the negative item in dispute from the report, and ended the arbitration there.  I believe this arbitration contract applies to credit bureau disputes, and additional fine print does state the contract is subject to the FCRA.  I'm leaning towards filing individual disputes.

 

Here's the Arbitration section of the contract:

 

Arbitration Agreement:


(a) CIC and you agree to arbitrate all disputes and claims between us, except any disputes or claims which under governing law are not subject to arbitration. This agreement to arbitrate is intended to be broadly interpreted and to make all disputes and claims between us subject to arbitration to the fullest extent permitted by law. It includes, but is not limited to:

  • claims arising out of or relating to any aspect of the relationship between us, whether based in contract, tort, statute (including, without limitation, the Credit Repair Organizations Act) fraud, misrepresentation or any other legal theory; claims that arose before this or any prior Agreement (including, but not limited to, claims relating to advertising); claims that are currently the subject of purported class action litigation in which you are not a member of a certified class; and claims that may arise after the termination of this Agreement.

For purposes of this arbitration provision, references to "CIC," "you," and "us" shall include our respective parent entities, subsidiaries, affiliates, agents, employees, predecessors in interest, successors and assigns, websites of the foregoing, as well as all authorized or unauthorized users or beneficiaries of services, products or information under this or prior Agreements between us. Notwithstanding the foregoing, either party may bring an individual action in small claims court. You agree that, by entering into this Agreement, you and CIC are each waiving the right to a trial by jury or to participate in a class action. This Agreement evidences a transaction in interstate commerce, and thus the Federal Arbitration Act governs the interpretation and enforcement of this arbitration provision. This arbitration provision shall survive termination of this Agreement.

 

( b ) A party who intends to seek arbitration must first send to the other, by certified mail, a written Notice of Dispute ("Notice"). The Notice to CIC should be addressed to: General Counsel, Experian, 475 Anton Boulevard, Costa Mesa, CA 92626 ("Notice Address"). The Notice must describe the nature and basis of the claim or dispute and set forth the specific relief you seek from CIC ("Demand"). If CIC and you do not reach an agreement to resolve the claim within 30 days after the Notice is received, you or CIC may commence an arbitration proceeding. During the arbitration, the amount of any settlement offer made by CIC or you shall not be disclosed to the arbitrator until after the arbitrator determines the amount, if any, to which you or CIC is entitled.

You may obtain more information about arbitration from www.adr.org.

 

( c ) After CIC receives notice at the Notice Address that you have commenced arbitration, it will promptly reimburse you for your payment of the filing fee. (The filing fee currently is $125 for claims under $10,000, but is subject to change by the arbitration provider. If you are unable to pay this fee, CIC will pay it directly upon receiving a written request at the Notice Address.) The arbitration will be governed by the Commercial Dispute Resolution Procedures and the Supplementary Procedures for Consumer Related Disputes (collectively, "AAA Rules") of the American Arbitration Association ("AAA"), as modified by this Agreement, and will be administered by the AAA. The AAA Rules are available online at www.adr.org, by calling the AAA at 1-800-778-7879, or by writing to the Notice Address.

 

All issues are for the arbitrator to decide, including the scope and enforceability of this arbitration provision as well as the Agreement’s other terms and conditions, and the arbitrator shall have exclusive authority to resolve any such dispute relating to the scope and enforceability of this arbitration provision or any other term of this Agreement including, but not limited to any claim that all or any part of this arbitration provision or Agreement is void or voidable. The arbitrator shall be bound by the terms of this Agreement. Unless CIC and you agree otherwise, any arbitration hearings will take place in the county (or parish) of your billing address. If your claim is for $10,000 or less, we agree that you may choose whether the arbitration will be conducted solely on the basis of documents submitted to the arbitrator, through a telephonic hearing, or by an in-person hearing as established by the AAA Rules. If your claim exceeds $10,000, the right to a hearing will be determined by the AAA Rules. Except as otherwise provided for herein, CIC will pay all AAA filing, administration and arbitrator fees for any arbitration initiated in accordance with the notice requirements above. If, however, the arbitrator finds that either the substance of your claim or the relief sought in the Demand is frivolous or brought for an improper purpose (as measured by the standards set forth in Federal Rule of Civil Procedure 11( b )then the payment of all such fees will be governed by the AAA Rules. In such case, you agree to reimburse CIC for all monies previously disbursed by it that are otherwise your obligation to pay under the AAA Rules.

 

(d) The arbitrator may make rulings and resolve disputes as to the payment and reimbursement of fees and expenses at any time during the proceeding or in the final award, pursuant to applicable law and the AAA Rules.

 

(e) Discovery and/or the exchange of non-privileged information relevant to the dispute will be governed by the AAA Rules.

 

(f) YOU AND CIC AGREE THAT EACH MAY BRING CLAIMS AGAINST THE OTHER ONLY IN YOUR OR ITS INDIVIDUAL CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING. Further, unless both you and CIC agree otherwise, the arbitrator may not consolidate more than one person's claims, and may not otherwise preside over any form of a representative or class proceeding. The arbitrator may award injunctive relief only in favor of the individual party seeking relief and only to the extent necessary to provide relief warranted by that party's individual claim. If this specific subparagraph (f) is found to be unenforceable, then the entirety of this arbitration provision shall be null and void.

 

(g) Notwithstanding any provision in this Agreement to the contrary, we agree that if CIC makes any change to this arbitration provision (other than a change to the Notice Address) during your membership in any credit monitoring or other product, you may reject any such change and require CIC to adhere to the language in this provision if a dispute between us arises regarding such membership product.

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Beer, football, and honey baked ham!  What else does thanksgiving need?  Hope yours is happy too.

 

As to your question...I'm still not sure.  I know the primary intent of arb clauses is to prevent class actions.  If you're disputing tradelines and the contract relates to credit monitoring, I don't think its applicable.

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There is no reason why you cannot use arbitration to resolve this issue. The only thing I would be concerned about is the "frivol" clause they include.

If you are trying to have legitimate trade lines removed, this may backfire with your being required to pay the arbators fees. If it is for legitimate redress of errors with the trade lines, I don't see a problem at all.

Just make sure you follow the process as the spell it out in the contract, sending them a noticeof dispute 30 days before you file.

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Willing - no turkey, no apple pie?!  ;-)

 

I think the following language in their contract allows me to dispute FCRA violations on tradelines listed on my credit bureau report:

 

"This agreement to arbitrate is intended to be broadly interpreted and to make all disputes and claims between us subject to arbitration to the fullest extent permitted by law. It includes, but is not limited to:

  • claims arising out of or relating to any aspect of the relationship between us, whether based in contract, tort, statute (including, without limitation, the Credit Repair Organizations Act) fraud, misrepresentation or any other legal theory; claims that arose before this or any prior Agreement (including, but not limited to, claims relating to advertising); claims that are currently the subject of purported class action litigation in which you are not a member of a certified class; and claims that may arise after the termination of this Agreement.

For purposes of this arbitration provision, references to "CIC," "you," and "us" shall include our respective parent entities, subsidiaries, affiliates, agents, employees, predecessors in interest, successors and assigns, websites of the foregoing, as well as all authorized or unauthorized users or beneficiaries of services, products or information under this or prior Agreements between us."

 

I underlined the key sections I believe apply. I know this arbitration clause is in the agreement for the CRA to try to avoid class actions, but then they have to allow it to apply to individual claims. They can't have it both ways, and the contract terms open them up to arbitration on individual claims.  I suppose they can dispute my invoking arbitration, but then they just get a lawsuit. I also like the contract term that gives them 30 days to resolve the dispute prior to arbitration. Per iHeart's reply, I will give them 30 days per the contract before AAA is notified.

 

My main question is - I have a handful of legit complaints here against one CRA. Should I combine them into one large complaint, or put them on notice individually, and potentially arbitrate individually?

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@Determined1

 

except any disputes or claims which under governing law are not subject to arbitration

 

Does the agreement include any language that specifies which disputes or claims are not subject to arbitration?

 

Also, your contract is based upon credit monitoring.   What does "monitoring" include?

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Hi BV80,

 

Happy Holidays!  Thanks for your reply. I think the Agreement has some ambiguity to it. It does not specifically state it can be used for redress of individual credit disputes, but it doesn't say it cannot be, either. It has these three sentences I am relying on:

 

"This agreement to arbitrate is intended to be broadly interpreted and to make all disputes and claims between us subject to arbitration to the fullest extent permitted by law."

 

"claims arising out of or relating to any aspect of the relationship between us, whether based in contract, tort, statute" 

 

"For purposes of this arbitration provision, references to "CIC," "you," and "us" shall include our respective parent entities,"

 

The contract also states it is subject to the FCRA, and identifies "credit reporting" as one of the services they provide by way of this contract.  The FCRA contract provision states:  

 

"You understand and agree that by submitting your order you are providing "written instructions" in accordance with the Fair Credit Reporting Act, as amended ("FCRA"), for CIC to obtain information from your personal credit profile from Experian or any other credit reporting company and to obtain information from the personal credit profile, if any, of any minor child whom you have enrolled. You authorize CIC to access your credit profile (and those of any minor children whom you have enrolled), to verify your identity (or those of any minor children whom you have enrolled), and to provide credit monitoring, credit reporting, credit scoring, identity monitoring, fraud resolution and card registry products."

 

The main things they seem to "rule out" are damages as a result of actions by third party unaffiliated websites that link to them. The interesting part for me is the agreement is said to be "broadly interpreted" and extends to its parent corp., subsidiaries and affiliates. Also, the party to be put on notice is Experian's General Counsel.  My view is I'm killing three birds with one stone here. First, they have 30 days to resolve the dispute per contract. Second, no resolution and we go to arbitration, which is quite okay by me. Third, if they claim the arbitration provision doesn't apply to individual credit disputes, I've put their General Counsel on notice that they must resolve the dispute, arbitrate, or I'll sue. 

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@Determined1

 

Happy Holidays to you too!  :-)

 

The part that interests me is this:

 

"claims arising out of or relating to any aspect of the relationship between us, whether based in contract, tort, statute"

 

The FCRA is a statute by which CRAs are legally bound.

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Thanks BV80. I think I have a valid arbitration dispute. I'm only taking this approach after spending 1 plus year writing to Experian and having them essentially ignore my dispute letters on significant reporting errors. I sent off the demand letters today, and filed separate claims, instead of one global dispute. This will be interesting. If they fail to settle the dispute or adhere to arbitration, Florida's Unfair and Deceptive Trade Practices Act kicks in...

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@Determined1

 

Unless your particular dispute is not defined by the FCRA, I don't see how they can get out of arbitration based upon "statute".

 

Good luck!   :yahoo:

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Fascinating response by AAA to my demand for arbitration with Experian. AAA wrote to me saying they cannot move forward to provide arbitration services with Experian, as that company has refused to comply with past consumer requests for arbitration. The letter, sent to me and Experian then goes on to directly instruct Experian to remove AAA from its contracts.

 

I called AAA and asked if they would comply if either a Court ordered arbitration, or a consumer regulatory authority stated it was proper. In both instances they said yes, under those circumstances they would offer to provide arbitration services, but could not ensure Experian would appear.

 

The most interesting aspect of this for me is AAA directing Experian to remove them from their contracts and putting it in writing that Experian has not lived up to the arbitration clause of its contracts with consumers in the past. I would imagine this could be a problem for Experian, as they use the arbitration clause in an attempt to avoid class actions. I believe this letter fully supports a claim for violations of Florida's Deceptive and Unfair Trade Practices Act.  Debating my next move....

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Serve and file a complaint against Experian. Search the legal databases for cases where Experian has motioned to compel arbitration. Maybe BV80 will assist in the case law search.

 

http://codes.lp.findlaw.com/uscode/9/1/4

 

 

9 U.S.C. § 4 : US Code - Section 4: Failure to arbitrate under agreement; petition to United States court having jurisdiction for order to compel arbitration; notice and service thereof; hearing and determination 

 

A party aggrieved by the alleged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration may petition any United States district court which, save for such agreement, would have jurisdiction under title 28, in a civil action or in admiralty of the subject matter of a suit arising out of the controversy between the parties, for an order directing that such arbitration proceed in the manner provided for in such agreement.

 

Five days' notice in writing of such application shall be served upon the party in default. Service thereof shall be made in the manner provided by the Federal Rules of Civil Procedure. The court shall hear the parties, and upon being satisfied that the making of the agreement for arbitration or the failure to comply therewith is not in issue, the court shall make an order directing the parties to proceed to arbitration in accordance with the terms of the agreement. The hearing and proceedings, under such agreement, shall be within the district in which the petition for an order directing such arbitration is filed.

 

If the making of the arbitration agreement or the failure, neglect, or refusal to perform the same be in issue, the court shall proceed summarily to the trial thereof. If no jury trial be demanded by the party alleged to be in default, or if the matter in dispute is within admiralty jurisdiction, the court shall hear and determine such issue. Where such an issue is raised, the party alleged to be in default may, except in cases of admiralty, on or before the return day of the notice of application, demand a jury trial of such issue, and upon such demand the court shall make an order referring the issue or issues to a jury in the manner provided by the Federal Rules of Civil Procedure, or may specially call a jury for that purpose. If the jury find that no agreement in writing for arbitration was made or that there is no default in proceeding thereunder, the proceeding shall be dismissed. If the jury find that an agreement for arbitration was made in writing and that there is a default in proceeding thereunder, the court shall make an order summarily directing the parties to proceed with the arbitration in accordance with the terms thereof. - See more at: http://codes.lp.findlaw.com/uscode/9/1/4#sthash.uOPHFcW4.dpuf

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You could file multiple separate cases but the other party can move to have them combined into one and unless they are dramatically different with different basis and fact patterns the court will most likely grant their motion.  You are likely wasting time trying to mild the FCDPA cow for separate $1000 awards.

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Thanks Bad98Roadster, great info!  I think I have two options. The first is a CFPB complaint to urge them to comply with their own arbitration agreement. If they refuse, it further supports my claims. If they agree, I'm very glad to resolve this in arbitration. However, based on AAA's letter, I'll likely have to sue.  

I could simply sue to compel arbitration, or sue over each of my FCRA claims. What a ridiculous scenario they've created for consumers. I must admit to being amused that AAA told them to take their organization out of their contracts. I wonder if they'll change them?

 

Clydesmom, my issues are not FDCPA related, I am in a dispute with a credit bureau.

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