GOINES v. TITLEMAX OF VIRGINIA, INC

IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF NORTH CAROLINA

AARON GOINS, et al., )

)

Plaintiffs, )

)

v. ) 1:19CV489

)

TITLEMAX OF VIRGINIA, et al., )

)

Defendants. )

)

)

MEMORANDUM OPINION AND ORDER

LORETTA C. BIGGS, District Judge.

Before the Court is Plaintiff Phillip Brown’s Motion to Enforce Award and Enter

Judgment, (ECF No. 231). The motion requests that the Court confirm a Final Award issued

by Arbitrator Terrence Croft (“Final Award”) pursuant to 9 U.S.C. § 9 and enter judgment on

behalf of Plaintiff against Defendant TitleMax of South Carolina, Inc. (“TitleMax”) consistent

with the Final Award. (Id.) Plaintiff also requests attorneys’ fees. (Id.) For the reasons stated

herein, Plaintiff’s motion will be granted.

I. BACKGROUND

The Plaintiffs in this action allegedly entered into “car title loan” transactions with

Defendants at unlawful rates of interest.1 (See ECF No. 3.) Their Complaint alleged violations

of the North Carolina Consumer Finance Act (“CFA”), North Carolina’s usury statutes, and

1 A “car title loan” is a short-term loan product secured by a lien on the borrower’s vehicle.

the North Carolina Unfair and Deceptive Trade Practices Act (“UDTPA”). (ECF No. 3 at 7–

8 (citing N.C. Gen. Stat. §§ 24-1.1, 53-165, 75-1.1).) On April 22, 2020, this Court compelled

arbitration related to all but a few of the numerous Plaintiffs’ claims and ordered parties to

notify the Court of any arbitration awards within seven days after arbitration concluded. (ECF

No. 76 at 16.) The Plaintiff bringing this motion was a part of the claims ordered to arbitration.

Relevant to the present motion, in addition to considering liability, the Arbitrator

considered, among other issues, whether application of North Carolina law to Plaintiff’s loans

violated the Commerce Clause of the United States Constitution, whether the UDTPA’s

statute of limitations barred any claims arising from loans that Plaintiff took out more than

four years prior to commencing the action, and the proper measure of damages. (See ECF

Nos. 231-1 at 2.) The Arbitrator determined that application of North Carolina law was

proper, that the statute of limitations did not bar any claims due to the continuing wrongs

doctrine, and that TitleMax owed Plaintiff treble what he had paid to TitleMax. (Id.) The

Arbitrator therefore ordered TitleMax to pay to Plaintiff damages, which, after trebling, totaled

$18,888. (ECF No. 231-2 at 1.) The Arbitrator also awarded pre-award interest from the date

of the filing of the suit to accrue until the award was paid, and granted Plaintiff’s request for

$6,755 in attorney’s fees.2 (Id.)

Plaintiff then timely filed this motion to seeking an order confirming the Arbitrator’s

award and entering a judgment consistent with the award. (ECF No. 231.) As it has done

2 The Arbitrator’s Final Award explicitly incorporated a prior Interim Order of the Arbitrator “as if

set out in full.” (ECF No. 231-2 at 1 (referring to ECF No. 231-1).) Because resolving the present

motion does not require the Court to distinguish between these two documents, the Court will refer

to both the Final Award, (ECF No. 231-2), and the fully incorporated Interim Order, (ECF No. 231-

1), as the “Final Award” to minimize confusion.

with every other arbitration award against it related to its car title loans, TitleMax opposes the

motion and has asked the Court to vacate the Final Award. (ECF No. 256 at 1.)

II. STANDARD OF REVIEW

Judicial review of an arbitration award “is among the narrowest known at law.” UBS

Fin. Servs., Inc. v. Padussis, 842 F.3d 336, 339 (4th Cir. 2016) (quoting Apex Plumbing Supply, Inc.

v. U.S. Supply Co., 142 F.3d 188, 193 (4th Cir. 1998)). Judicial review is “severely

circumscribed. . . . [E]ven a mistake of fact or misinterpretation of law by an arbitrator

provides insufficient grounds for the modification of an award.” Apex Plumbing, 142 F.3d at

193–94. The court does not sit to reevaluate evidence or review mistakes of law. Id. at 194.

Instead, the reviewing court asks only “whether the arbitrators did the job they were told to

do—not whether they did it well, or correctly, or reasonably, but simply whether they did it.”

Three S Del., Inc. v. DataQuick Info. Sys., Inc., 492 F.3d 520, 527 (4th Cir. 2007) (quoting Remmey

v. PaineWebber, Inc., 32 F.3d 143, 146 (4th Cir. 1994)).

Thus, courts may vacate or modify an arbitration award only under “limited

circumstances.” Padussis, 842 F.3d at 339. The party opposing enforcement of the award

bears the “heavy burden” of showing that grounds to vacate the award exist under either the

Federal Arbitration Act (“FAA”) or common law. Three S Del., Inc., 492 F.3d at 527. Relevant

to this case, an award is vacated at common law where “the award evidences a manifest

disregard of the law.” Id. This high bar is reached only where (1) “the disputed legal principle

is clearly defined and not subject to reasonable debate,” and (2) “the arbitrator refused to apply

that legal principle.” Jones v. Dancel, 792 F.3d 395, 402 (4th Cir. 2015). Merely failing to explain

a legal conclusion will not justify vacating an award where the legal reasoning can be inferred.

United Steelworkers of Am. v. Enter. Wheel & Car Corp., 363 U.S. 593, 598 (1960). Further,

“proving manifest disregard require[s] something beyond showing that the arbitrators

misconstrued the law.” Wachovia Sec., LLC v. Brand, 671 F.3d 472, 481 (4th Cir. 2012).

Additionally, an award will be vacated under the FAA where the arbitrator “exceeded

their powers, or so imperfectly executed them that a mutual, final, and definite award upon

the subject matter submitted was not made.” 9 U.S.C. § 10(a)(4). An imperfect execution of

the agreement is not a sufficient cause to vacate: an award “even arguably construing or

applying the contract must stand” under this provision of the FAA “regardless of a court’s

view of its (de)merits.” Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 569 (2013). An award

that disposes of all issues is “mutual, final, and definite” even where the award does not detail

the arbitrator’s full reasoning. See Remmey, 32 F.3d at 150. “Arbitrators have no obligation to

the court to give their reasons for an award.” Enter. Wheel & Car Corp., 363 U.S. at 598.

III. DISCUSSION

A. The Arbitrator Did Not Manifestly Disregard the Dormant Commerce

Clause

TitleMax first argues that the Final Award evidences a manifest disregard of the

dormant Commerce Clause because it applies North Carolina law to loans that were executed

outside of North Carolina. (ECF No. 256 at 5.) TitleMax claims that pursuant to the Fourth

Circuit case Carolina Trucks & Equipment, Inc. v. Volvo Trucks of North America, Inc., 492 F.3d 484

(4th Cir. 2007), this application of North Carolina law to the loans violates the clearly defined

principle of law that “one state may not project its legislation into another, as the Commerce

Clause precludes the application of a state statute to conduct that takes place wholly outside

of the State’s borders, whether or not the commerce has effects within the State.” (ECF No.

256 at 6 (quoting Carolina Trucks, 492 F.3d at 489–90).)

However, as this Court explained the last time that TitleMax sought to vacate an

arbitration award using this argument, “the law as applied to the facts in this case is not so

‘well-established.’” See Goins v. TitleMax of Va., Inc., No. 19-CV-489, 2021 WL 3856164, at *2

(M.D.N.C. Aug. 27, 2021) (quoting ECF No. 104 at 8).

A statute can violate the dormant Commerce Clause in two ways. See McBurney v. Young,

667 F.3d 454, 468 (4th Cir. 2012); Env’t Tech. Council v. Sierra Club, 98 F.3d 774, 785 (4th Cir.

1996). First, a law is per se unconstitutional if it discriminates against out-of-state transactions.

Sierra Club, 98 F.3d at 785. Second, where a law does not discriminate, it is constitutional

“unless the burden imposed on interstate commerce is clearly excessive in relation to the

putative local benefits.” McBurney, 667 F.3d at 468 (citing Pike v. Bruce Church, Inc., 397 U.S.

137, 142 (1970)). This second test “frequently requires judges to make highly subjective calls”

in evaluating state interests. Colon Health Ctrs. of Am., LLC, v. Hazel, 813 F.3d 145, 156 (4th

Cir. 2016). Because judges are “ill-equipped to second-guess the empirical judgments of

lawmakers concerning the utility of legislation,” courts presume that nondiscriminatory

statutes are constitutional and give “due deference to the body whose primary responsibility

it is to judge the benefits and burdens of . . . legislation: the [state] legislature.” Id. (internal

quotations omitted). Consequently, nondiscriminatory laws receive rational basis review under

the dormant Commerce Clause. Id.

First, contrary to TitleMax’s contentions here, Carolina Trucks does not plainly and

definitively establish that the Commerce Clause prohibits North Carolina from regulating car

title loans made outside its boundaries. As this Court previously noted, Carolina Trucks was

decided on statutory and not constitutional grounds. Goins, No. 19-CV-489, 2021 WL

3856164, at *3 (“[T]he one Fourth Circuit case [that TitleMax] cited, Carolina Trucks . . . was

decided on statutory and not constitutional grounds.”); Carolina Trucks, 492 F.3d at 489 (“By

reaching this holding as a matter of statutory construction, we avoid constitutional problems

inherent in a broader interpretation of South Carolina law.”). Additionally, as the Third Circuit

recently observed in a case involving, among other things, car title loans made by TitleMax of

Virginia, Inc., Carolina Trucks “involved transactions in goods that ended at the point of sale,”

and such transactions are not analogous to TitleMax loans, which have “a longer lifespan,”

and “involve[] later payments and permit[] a physical taking (repossession) from inside another

state.” TitleMax of Del., Inc. v. Weissmann, 24 F.4th 230, 239 (3d Cir.), cert. denied sub nom. TitleMax

of Del., Inc. v. Vague, 142 S. Ct. 2870 (2022). Accordingly, the Arbitrator’s failure to reach

TitleMax’s preferred legal conclusion does not evidence a manifest disregard for the

Commerce Clause as interpreted by the Fourth Circuit in Carolina Trucks.

Second, as demonstrated by the Third Circuit case, there is ample room to reasonably

argue that a state can regulate car title loans made to its residents while they were outside its

borders. In Weissmann, the Third Circuit considered whether Pennsylvania’s usury laws could

be applied to TitleMax loans made outside of Pennsylvania, and, after conducting a full

constitutional analysis, the Third Circuit concluded that application of Pennsylvania law to the

loans did not violate the Commerce Clause. Id. at 234–35, 237–41 (“Pennsylvania may

therefore investigate and apply its usury laws to TitleMax without violating the Commerce

Clause.”). That the Third Circuit has rejected TitleMax’s interpretation of the dormant

Commerce Clause as applied to its car title loans and state usury laws suggests a weakness in

TitleMax’s arguments. However, with respect to the issue before the court—whether the Final

Award must be vacated because the Arbitrator manifestly disregarded the Commerce Clause—

this Court does review whether the Arbitrator’s legal conclusion was correct or not. The

question for this Court is whether the Arbitrator refused to apply a clearly defined principle

of law not subject to reasonable debate, and Weissmann demonstrates that TitleMax’s proposed

principle of law is, at minimum, subject to reasonable debate.3

Accordingly, the Court finds that the Arbitrator did not manifestly disregard the

Commerce Clause by applying North Carolina law to Plaintiff’s loan.

B. The Arbitrator Did Not Manifestly Disregard North Carolina Law

Regarding the Calculation of Damages

TitleMax also argues that the Arbitrator manifestly disregarded North Carolina law by

conflating the frameworks for determining damages under North Carolina’s CFA and

UDTPA. (ECF No. 256 at 7–10.) Specifically, TitleMax argues that the Arbitrator improperly

calculated the treble damages available to Plaintiff under the UDTPA by using a CFA penalty

as the base of the treble damages calculation, rather than the “injury done” or “actual damages”

suffered by Plaintiff. (Id.) TitleMax contends that by choosing the wrong base damages figure

to treble, the Arbitrator manifestly disregarded North Carolina law against duplicate recoveries

of punitive damages. (Id.)

3 TitleMax has argued that the Arbitrator erred by citing Weissman as supporting the Final Award

because, according to TitleMax, Weissman created a circuit split between the Third Circuit and the

Fourth Circuit, and the Arbitrator should therefore have rejected Weissman in favor of Carolina Trucks.

(ECF No. 256 at 6 n.4.) However, the existence of a circuit split only bolsters the point that reasonable

minds can disagree about TitleMax’s proposed legal principle, and, moreover, unlike decisions of this

Court, decisions of the Arbitrator are not appealable to the Fourth Circuit.

TitleMax has failed to satisfy its burden of showing that the Arbitrator manifestly

disregarded the law. TitleMax’s argument does nothing more than challenge the Arbitrator’s

interpretation of applicable law—something courts have consistently held will not warrant the

vacating of an arbitration award. See, e.g., Interactive Brokers LLC v. Saroop, 969 F.3d 438, 443

(4th Cir. 2020) (“When parties consent to arbitration, and thereby consent to extremely limited

appellate review, they assume the risk that the arbitrator may interpret the law in a way with

which they disagree.” (quoting Wachovia, 671 F.3d at 478 n.5)); SmartSky Networks, LLC v.

Wireless Sys. Sols., LLC, No. 20-CV-000834, 2022 WL 353801, at *5 (M.D.N.C. Feb. 7, 2022)

(“A district court may not overturn an arbitration award ‘just because it believes, however

strongly, that the arbitrators misinterpreted the applicable law.’” (quoting Wachovia, 671 F.3d

at 478 n.5)).

The CFA provides that a party in violation of the CFA “shall not collect, receive, or

retain any principal or charges whatsoever with respect to the loan.” N.C. Gen. Stat. § 53-

166. The UDTPA provides that “if damages are assessed [for committing an unfair and

deceptive trade practice] judgment shall be rendered . . . for treble the amount fixed by the

verdict.” N.C. Gen. Stat. § 75-16. Here, it is evident that the Arbitrator determined that

damages should be everything that TitleMax collected from Plaintiff (pursuant to the CFA),

trebled (pursuant to the UDTPA). The Arbitrator first identified both N.C. Gen. Stat. § 53-

166 and N.C. Gen. Stat. 75-1.1 et seq. as the basis for awarding damages. (ECF No. 231-1 at

2.) The Arbitrator then determined that Plaintiff had paid $6,296 to TitleMax and multiplied

that amount by three to arrive at $18,888 in damages. (Id.)

It is not for this Court to determine whether the Arbitrator’s interpretation of the CFA

and its interplay with the UDTPA is correct. Under the “severely circumscribed” standard of

review of arbitration awards, it is enough that the Arbitrator provided some basis for the

assessment and calculations of damages. The Court finds that the Arbitrator did so here—

the Arbitrator identified a damages figure based on a statute and then trebled that figure based

on another statute. Even if TitleMax were correct that the Arbitrator picked the wrong base

damages figure to treble and consequently awarded improper duplicative punitive damages,

the Arbitrator’s error would be merely a mistake of statutory interpretation, which is not

grounds to vacate the award.

C. The Arbitrator Did Not Manifestly Disregard the Statute of Limitations

TitleMax additionally argues that the Arbitrator “ignored and improperly failed to

account for” the UDTPA’s four-year statute of limitations. (ECF No. 256 at 10.) TitleMax

argues that the statute of limitations on any loans it issued to Plaintiff began to run at the time

the loans were executed, and that they did not restart under the continuing wrong doctrine.

(Id.) Thus, TitleMax contends that any claim brought more than four years after the execution

of a TitleMax loan should be time-barred. (Id. at 10–11.)

This argument amounts only to another disagreement with the Arbitrator’s

interpretation of North Carolina law.

“[The North Carolina] Supreme Court has recognized the continuing wrong doctrine

as an exception to the general rule that a claim accrues when the right to maintain a suit arises.”

Babb v. Graham, 660 S.E.2d 626, 637 (N.C. Ct. App. 2008) (citing Williams v. Blue Cross Blue

Shield of N.C., 581 S.E.2d 415, 423 (N.C. 2003)). “When this doctrine applies, a statute of

limitations does not begin to run until the violative act ceases.” Id. (quoting Williams, 581

S.E.2d at 423). “[A] continuing violation is occasioned by continual unlawful acts, not by

continual ill effects from an original violation.” Id. (quoting Williams, 581 S.E.2d at 423). “In

order to determine whether a continuing violation exists, [a court] examine[s] ‘the particular

policies of the statute of limitations in question, as well as the nature of the wrongful conduct

and harm alleged.” Id. (quoting Williams, 581 S.E.2d at 423).

Here, the Arbitrator plainly considered the UDTPA’s statute of limitations, the

continuing wrong doctrine, and the proper application of both to the circumstances of this

case. The Arbitrator wrote:

[N.C. Gen. Stat. §] 53-166(d) makes it a violation to collect, receive or retain any

principal or charges whatsoever with respect to the loan. [TitleMax] ha[s] never

paid back the funds [it] obtained from [Plaintiff], and thus [TitleMax] retain[s]

those funds and the tortious conduct continues, and the violative acts have not

ceased and the statute of limitations has not run on any claim.

(ECF No. 231-1 at 2.) The Arbitrator thus determined that the statute of limitations did not

bar any of Plaintiff’s claims in this case. (Id.)

Based on the above explanation, the Court finds that the Arbitrator recognized the

issue, addressed the issue, and did not manifestly disregard the law.

D. Plaintiff Is Entitled to Attorneys’ Fees

Finally, Plaintiff requests that “additional attorneys’ fees or some other remedy should

be awarded for having to continue to file these Motions and Replies and then requiring the

Court [to devote] significant resources to [enter] Orders and Judgment.” (ECF No. 232 at 3.)

In TitleMax’s opposition brief, TitleMax does not address Plaintiff’s request for attorneys’

fees. (See ECF No. 256.)

“[W]ithout statutory authorization or contractual agreement between the parties, the

prevailing American rule is that each party in federal litigation pays his own attorney’s fees.”

Am. Reliable Ins. Co. v. Stillwell, 336 F.3d 311, 320 (4th Cir. 2003) (citing Alyeska Pipeline Serv.

Co. v. Wilderness Soc’y, 421 U.S. 240, 247, 263–64 (1975)). The burden is on the party seeking

attorneys’ fees to “identify [a] statutory or common law basis that would support” such an

award. Id.

Here, Plaintiff identifies two authorities to support an award of attorneys’ fees. (ECF

No. 232 at 3.) First, Plaintiff argues that the North Carolina Revised Uniform Arbitration Act

allows for an award of “reasonable attorneys’ fees and other reasonable expenses of litigation

incurred in a judicial proceeding after the award is made to a judgment confirming . . . an

award.” (Id.); N.C. Gen. Stat. § 1-569.25(c). Under this standard, a court has discretion to

award attorneys’ fees to “promote[] the statutory policy of finality of arbitration awards” and

discourage “all but the most meritorious challenges.” Astanza Design, LLC v. Giemme Stile,

S.p.A., 220 F. Supp. 3d 641, 653 (M.D.N.C. 2016) (quoting § 1-569.25(c) cmt. 3). Alternatively,

Plaintiff argues that awarding attorneys’ fees is within the Court’s “inherent authority.” (ECF

No. 232 at 3 (citing Int’l Chem. Workers Union (AFL-CIO), Loc. No. 227 v. BASF Wyandotte Corp.,

774 F.2d 43, 47 (2d Cir. 1985)).) “[I]n narrowly defined circumstances federal courts have

inherent power to assess attorney’s fees against counsel.” Chambers v. NASCO, Inc., 501 U.S.

32, 45 (1991) (quoting Roadway Express, Inc. v. Piper, 447 U.S. 752, 765 (1980)). One such

circumstance occurs “when the losing party has ‘acted in bad faith, vexatiously, wantonly, or

for oppressive reasons . . . .’” Roadway Express, 447 U.S. at 766 (quoting F. D. Rich Co. v. U. S.

ex rel. Indus. Lumber Co., 417 U.S. 116, 129 (1974)). A party “shows bad faith by delaying or

disrupting the litigation or by hampering enforcement of a court order.” Chambers, 501 U.S.

at 46 (quoting Hutto v. Finney, 437 U.S. 678, 690 n.14 (1978)).4

The Court finds that the purposes of N.C. Gen. Stat. § 1-569.25(c) are served by

awarding attorneys’ fees to Plaintiffs.

TitleMax’s objections to the arbitration awards are not meritorious. As discussed in

this Order and the Court’s previous Orders confirming other arbitration awards in this case,

judicial review of an arbitration award “is among the narrowest known at law.” Padussis, 842

F.3d at 339. “[E]ven a mistake of fact or misinterpretation of law by an arbitrator provides

insufficient grounds for the modification of an award,” and a reviewing court will not

reevaluate evidence or review mistakes of law. Apex Plumbing, 142 F.3d at 194. Nevertheless,

TitleMax advances arguments that amount only to contentions that the Arbitrator applied the

law in ways that TitleMax disagreed with. These arguments do not warrant vacating the award,

and, given the history of this case, TitleMax was well aware of this when it decided to oppose

Plaintiff’s motion. This Court has previously considered and rejected two of the three

arguments that TitleMax made here. (ECF Nos. 141 at 5–7 (finding that it was not a well-

established principle of constitutional law that North Carolina cannot regulate TitleMax loans

made to North Carolina residents while they were outside the boundaries of the North

Carolina)); 171 at 5–7 (finding that TitleMax’s argument about trebling damages without first

subtracting the value of the original loan was “nothing more than [a] challenge [to] the

Arbitrator’s interpretation of applicable law”).) Indeed, TitleMax’s argument here regarding

4 A court sitting in diversity may exercise this inherent power even when state law does not allow for

such an award, since “neither of [Erie’s] twin aims,” to discourage forum-shopping and avoid

inequitable administration of the laws, “is implicated by the assessment of attorney’s fees as a sanction

for bad-faith conduct.” Chambers, 501 U.S. at 52.

trebling of damages was copied and pasted from a prior filing. (Compare ECF No. 256 at 7–

10, with ECF No. 163 at 9–14.) Moreover, this Court has previously awarded attorneys’ fees

against TitleMax in this case for making that specific non-meritorious argument instead of

complying with an arbitrator’s award. (ECF No. 171 at 8–9.)

For the foregoing reasons, the Court in its discretion will award attorneys’ fees.

Regarding the amount of such fees, Plaintiff’s attorney has filed a declaration stating

that he spent 1 hour on this matter since the award of the arbitrator and requesting a rate of

$350 per hour for that time, which he represents is the customary hourly rate in this market

for attorneys of similar experience. (ECF No. 285-4 ¶¶ 5–6.) Plaintiff therefore requests $350

in attorneys’ fees related to confirming the arbitration award. (ECF No. 285-5 at 2.)

TitleMax having not mentioned any objections in its opposition brief and the Court

having considered the record in this case, Plaintiff’s declaration, the course of this litigation,

and the factors affecting the lodestar analysis set out in Barber v. Kimbrell’s, Inc., 577 F.2d 216,

226 & n.28 (4th Cir. 1978), the Court finds that Plaintiff’s requested attorney’s fees for 1 hour

at the rate of $350 per hour is reasonable. The Court has previously found that $350 per hour

is a reasonable rate for Plaintiff’s counsel’s work dealing with TitleMax’s meritless oppositions

to arbitration awards in this case given the market rate in this area. (ECF No. 249 at 4.)

Additionally, while Plaintiff’s counsel’s declaration could be clearer regarding the precise

breakdown of the time that he spent confirming the award, (ECF No. 285-4 ¶ 7), in light of

the amount of time that this Court has spent on this matter and TitleMax’s opposition, this

Court finds that 1 hour is a reasonable amount of time for Plaintiff’s counsel to take in

obtaining confirmation of the Final Award.

E. Additional Remedy Sought

Finally, with respect to Plaintiff’s request for “some other remedy . . . for having to

continue to file these Motions and Replies and then requiring the Court [to devote] significant

resources to [enter] Orders and Judgment,” (ECF No. 232 at 3), the Court cautions TitleMax

and its attorneys that Rule 11 of the Federal Rules of Civil Procedure states that an attorney

who presents a paper to a court certifies that to the best of his or her knowledge “it is not

being presented for any improper purpose, such as to harass, cause unnecessary delay, or

needlessly increase the cost of litigation,” and that “the claims, defenses, and other legal

contentions are warranted by existing law or by a nonfrivolous argument for extending,

modifying, or reversing existing law or for establishing new law.” Fed. R. Civ. P. 11(b)(1) &

(2). TitleMax’s pattern of resisting every arbitration award entered against it by repeating,

verbatim, arguments which this Court has deemed meritless and has previously rejected

appears to suggest an improper purpose.5 Several courts have recognized that “attempt[s] to

salvage arbitration losses through litigation that has no sound basis in the law” justify

“consider[ing] imposing sanctions in appropriate cases.” B.L. Harbert Int’l, LLC v. Hercules Steel

5 TitleMax claims in its opposition brief that it “recognizes that this Court has previously denied [its]

motions to vacate arbitration awards,” but contends that it submitted its present opposition “to

preserve its appellate rights on all matters referenced herein.” (ECF No. 256 at 4 n.3.) The record of

this case does not support that assertion. During the course of this litigation, TitleMax has filed only

one appeal (which was consolidated with an appeal from a companion case). (See ECF Nos. 171; 172;

178; 183; 184.) Specifically, TitleMax appealed a Memorandum Opinion and Order and an

accompanying Judgment that rejected the argument about improper trebling of damages that TitleMax

repeated almost verbatim in its present opposition. (See ECF No. 171 at 4–7.) TitleMax moved this

Court to certify its Judgment as final for the purposes of facilitating the appeal, (ECF Nos. 176; 177),

and this Court granted that motion, (ECF No. 248). However, TitleMax then voluntarily dismissed

its consolidated appeal a few days after Plaintiffs-Appellees filed their response brief. (See Goines v.

TitleMax of Va., Inc., No. 22-2005, ECF Nos. 30–35 (4th Cir.).) Under the circumstances of this case,

this behavior does not appear consistent with a sincere desire for the Fourth Circuit to pass on

TitleMax’s contentions.

Co., 441 F.3d 905, 914 (11th Cir. 2006), abrogated on other grounds by Frazier v. CitiFinancial Corp.,

604 F.3d 1313, 1321 (11th Cir. 2010).6

Accordingly, this Court hereby places TitleMax on notice that what appears to be its

litigation strategy of opposing confirmation of arbitration awards routinely using meritless

arguments that this Court has already considered and rejected may result in imposition of Rule

11 sanctions.

For the reasons stated herein, the Court enters the following:

ORDER

IT IS THEREFORE ORDERED that Plaintiff Phillip Brown’s Motion to Enforce

Award and Enter Judgment, (ECF No. 231), is GRANTED.

IT IS FURTHER ORDERED that Defendant TitleMax of South Carolina, Inc., is

ORDERED to pay to Plaintiff Phillip Brown damages of $18,888 as set forth in the

Arbitrator’s Final Award, (ECF No. 231-2 at 1). This sum is due and payable immediately

upon filing of the Judgment.

IT IS FURTHER ORDERED that Defendant TitleMax of South Carolina, Inc., is

ORDERED to pay to Plaintiff prejudgment interest on the compensatory portion of the

6 Johnson Controls, Inc. v. Edman Controls, Inc., 712 F.3d 1021, 1028 (7th Cir. 2013) (“[C]hallenges to

commercial arbitral awards bear a high risk of sanctions. Attempts to obtain judicial review of an

arbitrator’s decision undermine the integrity of the arbitral process.” (citation omitted)); Dominion

Video Satellite, Inc. v. Echostar Satellite L.L.C., 430 F.3d 1269, 1279 (10th Cir. 2005) (finding that district

court did not abuse its discretion in imposing sanctions where “given the narrow standard of review

[for arbitration awards], the arguments presented . . . were completely meritless . . . [and] [the] attorneys

need not have filed lengthy briefs at every stage of the arbitration and court proceedings in order to

preserve . . . arguments for appeal.”); Manning v. Smith Barney, Harris Upham & Co., 822 F. Supp. 1081,

1083–84 (S.D.N.Y. 1993) (“[S]anctions are peculiarly appropriate in the context of a challenge to an

arbitration award which appears to be a largely dilatory effort.”); see also CarMax Auto Superstores, Inc. v.

Sibley, 767 F. App’x 462, 464 (4th Cir. 2019) (unpublished) (“A district court may sanction a party for

attempting to relitigate issues already decided by the court.”).

damages award (that is, on the $6,296 attributable to the amounts that TitleMax collected from

Plaintiff) as set forth in the Arbitrator’s Final Award. This prejudgment interest accrued at

the North Carolina legal rate of eight percent from the date of the filing of the Complaint

(April 4, 2019) until the date of entry of the Judgment. This prejudgment interest is due and

payable immediately upon filing of the Judgment.

IT IS FURTHER ORDERED that Defendant TitleMax of South Carolina, Inc., is

ORDERED to pay to Plaintiff attorney’s fees of $7,105 (that is, $6,755 as awarded by the Final

Award plus $350 as awarded by this Court), which shall be due and payable immediately upon

filing of the Judgment.

IT IS FURTHER ORDERED that Defendant TitleMax of South Carolina, Inc., is

ORDERED to pay to Plaintiff post-judgment interest on the total of all sums set forth in the

Judgment (that is, the sum of: the $18,888 awarded by the Final Award, plus the pre-judgment

interest owed on the $6,296 compensatory portion of the Final Award, plus the $7,105 of

attorney’s fees) at the federal statutory rate that shall accrue until all sums set forth in the Judgment

are paid in full.

Judgment will be entered simultaneously with this Order.

This, the 28th day of April 2023.

/s/Loretta C. Biggs

United States District Judge