AAA rejects Citi Arb... Now what...?

[olvrtw]

I filed the motion to compel along with the election to arbitrate within my Answer. Citi filed a Motion for Stay to start arbitration. Their motion was granted, mine was marked off by the Judge.

Last week I got citi's AAA demand for arbitration papers. Today I received a letter from AAA:

Dear Parties:

This will acknowledge receipt of a demand for consumer arbitration filed by the business pursuant to an arbitration clause in a customer agreement.

Based on public discourse and evaluation of our case experience, the American Arbitration Association ("AAA") has determined not to accept new consumer debt arbitration filings filed by the business. This policy will be in effect until such time as the AAA determines that adequate and broadly acceptable due process protocols specific to these cases are in place. It is our intention to engage in earnest dialogue with a diversity of interest groups on what constitutes a proper protocol framework for these matters. For more detailed information about the AAA's position on debt collection arbitration please visit our website at www.adr.org.

Accordingly, we have administratively closed our file. Pursuant to R-1(d) of the Consumer Arbitration Rules, should the AAA decline to administer an arbitration, either party may choose to submit its dispute to the appropriate court for resolution. Any payments sent by the filing party will be refunded under separate cover.

Pursuant to the AAA's current policy, in the normal course of our administration, the AAA may maintain certain electronic case documents in our electronic records system. Such electronic documents may not constitute a complete case file. Other than certain types of electronic case documents that the AAA maintains indefinitely, electronic case documents will be destroyed 18 months after the date of this letter.

The AAA remains available to assist the parties in the use of voluntary dispute resolution mechanisms, both binding and non-binding. We encourage the parties to review these options on our website, www.adr.org, and please email ConsumerFiling@adr.org if you wish to take advantage of these services or if you have any questions about our poliocies.

Sincerely,

...

Now what do I do? It looks like it will be pretty obvious that Citi will try to take this back to court, even though our cardmember agreement specifically states:

If arbitration is chosen by any party, neither you nor we will have the right to litigate that Claim in court or have a jury trial on that Claim...

 

Should I file a motion to dismiss based on the fact that AAA in its decline letter places blame on the business for declining the arbitration?

[Goody_Ouchless]

Others will be more eloquent, but the facts remain the same. The contract that binds you both offers you the option of arbitration. Courts agree that is the chosen method of dispute resolution, if available. 

There seems to be "something in the air" where AAA has been "bought off," sending these "back to court" letters. But I'm cray.

 

[BV80]

3 hours ago, olvrtw said:

Based on public discourse and evaluation of our case experience, the American Arbitration Association ("AAA") has determined not to accept new consumer debt arbitration filings filed by the business.

That doesn’t say AAA will refuse to accept new filings filed by the consumer.  

[Harry Seaward]

3 hours ago, olvrtw said:

Based on public discourse and evaluation of our case experience, the American Arbitration Association ("AAA") has determined not to accept new consumer debt arbitration filings filed by the business.

As BV80 pointed out, this only applies to cases filed by the business in debt collection cases.  Several years ago, arbitration companies got in a lot of trouble for being in cahoots with credit card companies.  This is the "public discourse and evaluation" they are talking about.  As part of their 'reform', they voluntarily established a policy to reject debt collection cases filed by the businesses.

You can file the case yourself and they will absolutely accept it.

Just curious:  what's your objective with taking Citi to arbitration, if you don't mind answering?

[olvrtw]

My objective is to allow time for negotiating a better settlement or hopefully they would just drop it due to the high cost of arbitration...

[olvrtw]

9 hours ago, BV80 said:

That doesn’t say AAA will refuse to accept new filings filed by the consumer.  

Yea I know. I was just hoping to leave that in the dark unless that was clear to the lawyer or judge... Would be nice to use the fact that AAA has denied them the case based on public discourse and their case experience...

[Goody_Ouchless]

@BV80 and @Harry Seaward - great catch on meaning behind AAA letter. If I was a plaintiff in these matters I would totally try to spin the letter as saying "AAA remands this matter back to court," and hope the judge is sympathetic.  It seems the best plaintiffs can do in these cases is get an appeal-able ruling and hope the defendant gives up or drops the ball. 

[olvrtw]

yea, that wont work on me, haha. 

[1stStep]

I have a slightly different POV...

 

AAA has rejected the arbitration and closed the case. If Citi goes back and attempts to pursue the case now back in court, you have a clear counterclaim for violation of the Cardholder Agreement by Citi. File the counterclaim for 3x's the debt and begin negotiating...

[BV80]

1 hour ago, 1stStep said:

I have a slightly different POV...

 

AAA has rejected the arbitration and closed the case. If Citi goes back and attempts to pursue the case now back in court, you have a clear counterclaim for violation of the Cardholder Agreement by Citi. File the counterclaim for 3x's the debt and begin negotiating...

It is not Citi’s fault that AAA has decided against taking on consumer cases when filed by the business.  Citi cannot force AAA to arbitrate the claim.   Therefore, Citi would not be in violation of the arbitration provision if it tried to continue in court.  

[olvrtw]

17 hours ago, BV80 said:

It is not Citi’s fault that AAA has decided against taking on consumer cases when filed by the business.  Citi cannot force AAA to arbitrate the claim.   Therefore, Citi would not be in violation of the arbitration provision if it tried to continue in court.  

Its not my fault either. But 1stStep is right. If they do try to litigate the claim in court again they will violate the Cardholder Agreement.

 

They did put these 2 lines in their Arbitration provision:

If arbitration is chosen by any party, neither you nor we will have the right to litigate that Claim in court or have a jury trial on that Claim.

Arbitration shall be conducted by the American Arbitration Association (“AAA”) according to this arbitration provision and the applicable AAA arbitration rules in effect when the claim is filed (“AAA Rules”), except where those rules conflict with this arbitration provision.

So even though AAA rules say they can go back to court, they actually cant because of the BOLD section in their arbitration provision.

 

If it was the other way around, and I tried to take them back to court, they would fight tooth and nail, and any sane judge would side with them. But I know for a fact that there are a whole lot of non sane judges out there...

Keep in mind, even though the Arbitration provision is an option, the Arbitration provision does not state anywhere that if elected Arbitration must be initiated or completed or anything. I dont know all the other Federal or State rules, but I still have not found anything anywhere that says that if elected Arbitration must be initiated or completed...

I do know that everyone including judges and lawyers believe that the Motion to compel arbitration is a way to force the other party to do Arbitration. But it is being misused when it forces a Defendant to file a claim against himself on behalf of the Plaintiff, and end up paying a $200 filing fee, whereas if the business filed there is no fee. But the fee is not even the point, there is nothing that states who must file the arbitration claim, and thinking logically why would anyone file a claim against themselves?

[Harry Seaward]

41 minutes ago, olvrtw said:

If they do try to litigate the claim in court again they will violate the Cardholder Agreement.

 In light of the events that have transpired in your case, and the fact that you have done nothing to keep the arbitration ball in play , I doubt an appellate court would agree that they violated the agreement if they were to return to court in order to collect this debt.

[Guest usctrojanalum]

If I remember when NAF stopped taking consumer debt claims way back when, courts were requiring the parties to find another arbitration provider - even where NAF was the only arb provider named in the contract.

[BV80]

2 hours ago, olvrtw said:

Its not my fault either. But 1stStep is right. If they do try to litigate the claim in court again they will violate the Cardholder Agreement.

 

They did put these 2 lines in their Arbitration provision:

If arbitration is chosen by any party, neither you nor we will have the right to litigate that Claim in court or have a jury trial on that Claim.

Arbitration shall be conducted by the American Arbitration Association (“AAA”) according to this arbitration provision and the applicable AAA arbitration rules in effect when the claim is filed (“AAA Rules”), except where those rules conflict with this arbitration provision.

So even though AAA rules say they can go back to court, they actually cant because of the BOLD section in their arbitration provision.

 

If it was the other way around, and I tried to take them back to court, they would fight tooth and nail, and any sane judge would side with them. But I know for a fact that there are a whole lot of non sane judges out there...

Keep in mind, even though the Arbitration provision is an option, the Arbitration provision does not state anywhere that if elected Arbitration must be initiated or completed or anything. I dont know all the other Federal or State rules, but I still have not found anything anywhere that says that if elected Arbitration must be initiated or completed...

I do know that everyone including judges and lawyers believe that the Motion to compel arbitration is a way to force the other party to do Arbitration. But it is being misused when it forces a Defendant to file a claim against himself on behalf of the Plaintiff, and end up paying a $200 filing fee, whereas if the business filed there is no fee. But the fee is not even the point, there is nothing that states who must file the arbitration claim, and thinking logically why would anyone file a claim against themselves?

No, it’s not your fault either, but you can not deny the plaintiff a forum in which to have their claims heard.  If it were the other way around, and they objected to you continuing the case in court, they would be trying to deny you a forum.

The plaintiff did what,it was,supposed to do by filing the arbitration claim.  A judge is not going to hold the plaintiff responsible for the arbitration forum’s decision.   

And, as @Harry Seaward pointed out, you are not prevented from filing an arbitration claim yet have not done so.  By not doing so, you would be showing the court that you are not serious about arbitration.

[olvrtw]

Well I did email the lawyer and let him know that I know that the claim was denied, and I made a settlement offer. I made a settlement offer before as well and they never replied. I will give them a call after new years, its a busy time now...

[olvrtw]

4 hours ago, BV80 said:

 

No, it’s not your fault either, but you can not deny the plaintiff a forum in which to have their claims heard.  If it were the other way around, and they objected to you continuing the case in court, they would be trying to deny you a forum.

The plaintiff did what,it was,supposed to do by filing the arbitration claim.  A judge is not going to hold the plaintiff responsible for the arbitration forum’s decision.   

And, as @Harry Seaward pointed out, you are not prevented from filing an arbitration claim yet have not done so.  By not doing so, you would be showing the court that you are not serious about arbitration.

Isn't that the whole point of the arbitration provision. To deny consumers a public forum from hearing their claims. So any wrongdoing on their part will never be public record...

[WhoCares1000]

3 minutes ago, olvrtw said:

Isn't that the whole point of the arbitration provision. To deny consumers a public forum from hearing their claims. So any wrongdoing on their part will never be public record...

But if you had a claim against the creditor and the all arbitration organizations refused to hear it, then you could convince the courts to hear your claim. In fact, that is the argument Uber Drivers are using against Uber who is dragging their feet in arbitration. That is why it might bot be a good idea for you to drag your feet too much.

[BV80]

6 minutes ago, olvrtw said:

Isn't that the whole point of the arbitration provision. To deny consumers a public forum from hearing their claims. So any wrongdoing on their part will never be public record...

Consumers are given the opportunity to opt of arbitration.

By claiming they breach the contract if they try to continue the case in court, you would be trying to deny them any forum at all to have their claims heard.  

 

[Harry Seaward]

34 minutes ago, olvrtw said:

To deny consumers a public forum from hearing their claims.

Only on class action suits. You can sue them all day long in state/federal court, and as long as your monetary demands aren't unreasonable, they'll never take it to arbitration because of their high fee cost. 

[olvrtw]

2 hours ago, BV80 said:

Consumers are given the opportunity to opt of arbitration.

By claiming they breach the contract if they try to continue the case in court, you would be trying to deny them any forum at all to have their claims heard.  

 

Yea well, I did not opt out and they put it into their contract on their own. I didn't force them to put that provision in there... Its in a way similar to a non disclosure agreement or a release of liability agreement...

[BV80]

7 minutes ago, olvrtw said:

Yea well, I did not opt out and they put it into their contract on their own. I didn't force them to put that provision in there... Its in a way similar to a non disclosure agreement or a release of liability agreement...

It doesn’t matter that you didn’t tell them to put it in there.  You agreed to the terms and conditions. 

Your breach of contract claim would fail for another reason.  You were the first to breach the contract when you failed to pay.  One who has already breached a contract cannot claim a later breach against the other party   

Your claim would have to be breach of the arbitration provision.  But again, they would not be breaching the provision by attempting to continue in court.  If you truly want arbitration with AAA, it will be up to you to initiate.

[1stStep]

If anything, a counterclaim could force the OP and Citi to negotiate a settlement...

 

I have used the tactic in the past - filing counterclaims on thinner grounds and forcing the Plaintiff to negotiate. The last thing the Plaintiff needs is to lose a counterclaim which could become a precedent.

[olvrtw]

well, I just recently received letters that seem like the cases are going through. I am supposed to file an answer by tomorrow (I'm sorry, I do things at the last minute all the time). Citi is also supposed to pay their $2500 arbitrator compensation per case by tomorrow, lol. Maybe they thought $500 is all it took to do arbitration, lol. I emailed AAA asking what is going on and what exactly are the new "adequate and broadly acceptable due process protocols specific to these cases" that they are continuing with them... It seems like there may be a bit of bias off the bat as AAA is disregarding its own policy for the business at the start of the case already, heh...

[pulpfiction0]

On 12/21/2018 at 7:41 PM, olvrtw said:

Strange that the judge ordered Citi to initiate the Arb.

Almost everything I've seen that the party filing the MTC (the consumer) being forced to initiate it. I've had to do so against Amex/Zwicker.

Out of curiosity, is Citi represented by Schreiber/Cohen here? (we're in the same state).

My guess is that Citi knew AAA would not accept their filing (as others above mentioned, this goes back to the days where NAF was taken down by the Minnesota AG) and therefore get the clause stricken due to impossibility.

 

On 12/21/2018 at 7:41 PM, olvrtw said:

 

 

 

 

 

 

 

I filed the motion to compel along with the election to arbitrate within my Answer. Citi filed a Motion for Stay to start arbitration. Their motion was granted, mine was marked off by the Judge.

Last week I got citi's AAA demand for arbitration papers. Today I received a letter from AAA:

Dear Parties:

This will acknowledge receipt of a demand for consumer arbitration filed by the business pursuant to an arbitration clause in a customer agreement.

Based on public discourse and evaluation of our case experience, the American Arbitration Association ("AAA") has determined not to accept new consumer debt arbitration filings filed by the business. This policy will be in effect until such time as the AAA determines that adequate and broadly acceptable due process protocols specific to these cases are in place. It is our intention to engage in earnest dialogue with a diversity of interest groups on what constitutes a proper protocol framework for these matters. For more detailed information about the AAA's position on debt collection arbitration please visit our website at www.adr.org.

Accordingly, we have administratively closed our file. Pursuant to R-1(d) of the Consumer Arbitration Rules, should the AAA decline to administer an arbitration, either party may choose to submit its dispute to the appropriate court for resolution. Any payments sent by the filing party will be refunded under separate cover.

Pursuant to the AAA's current policy, in the normal course of our administration, the AAA may maintain certain electronic case documents in our electronic records system. Such electronic documents may not constitute a complete case file. Other than certain types of electronic case documents that the AAA maintains indefinitely, electronic case documents will be destroyed 18 months after the date of this letter.

The AAA remains available to assist the parties in the use of voluntary dispute resolution mechanisms, both binding and non-binding. We encourage the parties to review these options on our website, www.adr.org, and please email ConsumerFiling@adr.org if you wish to take advantage of these services or if you have any questions about our poliocies.

Sincerely,

...

Now what do I do? It looks like it will be pretty obvious that Citi will try to take this back to court, even though our cardmember agreement specifically states:

If arbitration is chosen by any party, neither you nor we will have the right to litigate that Claim in court or have a jury trial on that Claim...

 

Should I file a motion to dismiss based on the fact that AAA in its decline letter places blame on the business for declining the arbitration?

 

 

 

 

 

[Goody_Ouchless]

40 minutes ago, pulpfiction0 said:

For more detailed information about the AAA's position on debt collection arbitration please visit our website at www.adr.org.

No that sounds interesting...