# HAPPY v. MARLETTE FUNDING, LLC

> District Court, W.D. Pennsylvania · August 9, 2024

URL: https://www.frixlaw.com/law-library/cases/10668106

## Case

- **Court:** District Court, W.D. Pennsylvania
- **Decided:** August 9, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10668106

## How later opinions describe it (automated extraction)

- noting would be anomalous to apply a contract’s choice of law provision unless it has first been ascertained that the disputed contract exists

## Opinion text

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
MICHELE HAPPY and CHAD )
GORDON, individually and on behalf of ) C.A. No. 23-265 Erie
All others similarly situated, )
Plaintiffs, )
. )
Vv. ) District Judge Susan Paradise Baxter
)
MARLETTE FUNDING, LLC d/b/a )
BEST EGG, )
Defendant. )

MEMORANDUM OPINION

L INTRODUCTION
Plaintiffs Michele Happy (“Happy”) and Chad Gordon (“Gordon”) (collectively referred
to as “Plaintiffs”), filed a putative class action complaint on behalf of themselves and all others
similarly situated, against Defendant Marlette Funding, LLC d/b/a Best Egg, asserting claims
under the Unfair Trade Practices and Consumer Protection Law, 75 Pa. C.S. §§ 201, ef seq.
(“UTPCPL”), the Loan Interest and Protection Law, 41 Pa. C.S. §§ 101, ef seq. (“LIPL”), and the
Consumer Discount Company Act (“CDCA”), regarding the interest rates charged on loans
applied for and obtained through Defendant’s website.

_ Presently pending before the Court is Defendant’s motion to compel individual
arbitration pursuant to the Federal Arbitration Act, 9 U.S.C. § 1, et seg. FAA”). [ECF No. 9}.
Attached as an exhibit to Defendant's brief in support of its motion [ECF No. 10], is the affidavit
of Defendant’s Chief Operating Officer, Alessandro Rhodes (“Rhodes”), accompanied by copies
of the loan agreements pertaining to the loans obtained by Plaintiffs, each of which contained a
broad arbitration provision. [ECF No. 10-1].

The arbitration provision at issue in this case was contained within a “clickwrap
agreement” to which the borrower must electronically assent to obtain the loan. “A clickwrap
agreement appears on an internet webpage and requires that a user consent to any terms or
conditions by clicking on a dialog box on the screen in order to proceed with the internet
transaction.” Feldman v. Google, Inc., 513 F. Supp. 2d 229, 236 (E.D. Pa. 2007).
Here, Plaintiffs applied for each of their loans through Defendant’s “Best Egg” online
lending platform. In order to complete each of the the online applications and obtain their “Best
Egg” loans, Plaintiffs were required to click a checkbox on the bottom half of the Truth and
Lending Statement (“TIL Statement”), as shown in the following screenshot:!
See your Loar Agreement for any adelitional information about nonpayment, default or other matters related to your
loari. :
fe.) means estimate

itamization of amount financed:
Amount of Your Leary $70,526.00
Origination Fee: £525.25
Amount Given te You Oirectly or your designee: $10,000.75
Annual Loan Interest Rate: 6.82%. Interest at this Loan Interest Rate plus the Origination Fee results in the Finerice
Charge and Annual Percentage Rate disclosed above.
gy clicking the checkbox and the Accept and Subrnit button below, | am telling you that:
(| i have read and agree tothe E-sign Act Consent and | consent ta receive all disclosures
and other decusnents from you electronically.
i have read The Truth in Lerwing Disclosure Statement jgbove), Loan Agreement, Credit
Score Notice and the Privacy Policy, and intend this to. be my electronic signature on the
Loan Agrearnent.
bunderstund that the funding of my loan request Issuhject to verification of the information { provided in my aaplicatian, Including my
identity. | alse understand that my full credit report will be accessed by Bast fgg which may jeypact ny credit acore,

ers, reese nesoarens
(gee) Back to rates page ee
Se ae
The dollar figures shown are merely illustrative and have no relevance to any of the loans at issue in this case.

(ECF No. 10-1, Rhodes affidavit, at § 6).
The first (underlined) reference to “Loan Agreement” in the above screenshot contained a
hyperlink to the loan agreement governing each of Plaintiffs’ “Best Egg” loans. (Id. at {| 7). By
clicking on this hyperlink, Plaintiffs had the opportunity to review their loan agreements before
they completed the online applications for their “Best Egg” loans. (Id. at [ 8). Each loan
agreement contained the arbitration provision at issue, at paragraph 26 thereof, which provided,
in pertinent part, as follows:
a. Either party to this Agreement, or any subsequent assignee of this
Agreement, may, at its sole election, require that the sole and exclusive
forum and remedy for resolution of a Claim be final and binding
arbitration pursuant to this paragraph 26 (the "Arbitration Provision"),
unless you opt out as provided in paragraph 26(b) below. As used in this
Arbitration Provision, "Claim" shall include any past, present, or future
claim, dispute, or controversy involving you (or persons claiming through
or connected with you), on the one hand, and us and/or any assign (or
persons claiming through or connected with us and/or any assign), on the
other hand, relating to or arising out of this Agreement and/or the
activities or relationships that involve, lead to, or result from this
Agreement, including (except to the extent provided otherwise in the last
sentence of paragraph 26(f) below) the validity or enforceability of this
Arbitration Provision, any part thereof, or the entire Agreement. Claims
are subject to arbitration regardless of whether they arise from contract;
tort (intentional or otherwise); a constitution, statute, common law, or
principles of equity; or otherwise. Claims include matters arising as initial
claims, counter-claims, cross-claims, third-party claims, or otherwise. The
scope of this Arbitration Provision is to be given the broadest possible
interpretation that is enforceable.
* %

h. .... THE PARTIES ACKNOWLEDGE THAT THEY HAVE A RIGHT
TO LITIGATE CLAIMS THROUGH A COURT BEFORE A JUDGE
OR JURY, BUT WILL NOT HAVE THAT RIGHT IF ANY PARTY
ELECTS ARBITRATION PURSUANT TO THIS ARBITRATION
PROVISION. THE PARTIES HEREBY KNOWINGLY AND
VOLUNTARILY WAIVE THEIR RIGHTS TO LITIGATE SUCH
CLAIMS IN A COURT BEFORE A JUDGE OR JURY UPON
ELECTION OF ARBITRATION BY ANY PARTY

(ECF No. 10-1, at pp. 13-15, 24-26, 35-37, 46-48) (capitalized terms in original).
Plaintiffs have filed a response in opposition to Defendant’s motion to compel arbitration
denying the applicability and enforceability of the foregoing arbitration provision [ECF No. 12],
and Defendant has filed a reply [ECF No. 15]. This matter is now ripe for consideration.
I. DISCUSSION
A. Standard of Review
When deciding a motion to compel arbitration, a court must first determine the applicable
standard of review: the motion to dismiss standard under Fed. R. Civ. P. 12(b)(6) or the summary
judgment standard under Fed. R. Civ. P. 56. See Silfee v. Automatic Data Processing, Inc., 696
Fed. Appx. 576, 578 (3d Cir. 2017); Guidotti v. Legal Helpers Debt Resol., LLC, 716 F.3d 764,
772 (3d Cir. 2013). “When it is apparent, based on the face of a complaint, and documents relied

upon in the complaint, that certain of a party's claims are subject to an enforceable arbitration
clause, a motion to compel arbitration should be considered under a Rule 12(6)(6) standard
without discovery's delay.” Guidotti, 716 F.3d at 776. On the other hand, “if the complaint and
its supporting documents are unclear regarding the agreement to arbitrate, or if the plaintiff has
responded to a motion to compel arbitration with additional facts sufficient to place the
agreement to arbitrate in issue, then the parties should be entitled to discovery on the question of
arbitrability,” after which the court should consider the motion under the Rule 56 summary
judgment standard. Id.; see also Healthplan CRM, LLC v. AvMed, Inc., 458 F. Supp. 3d 308,
316 (W.D. Pa. 2020) (If “the opposing party has come forth with reliable evidence that is more
than a naked assertion ... that it did not intend to be bound by the arbitration agreement, even
—_>-:-—
At paragraph 26(b), the arbitration provision granted Plaintiffs the right to opt out of the arbitration provision within
thirty (30) days of execution of the loan agreement; however, Plaintiffs do not allege that they did so. Additionally,
paragraph 26(f) expressly excludes class arbitration. (see, ¢.g., ECF No. 10-1 at pp. 14-50).

though on the face of the pleadings it appears that it did, then resort to discovery and Rule 56 is
proper”).
Here, the patties have both taken the position that Defendant’s motion to compel should
be reviewed under the Rule 12(b)(6) standard. (ECF No. 10, at pp. 12-13; ECF No. 12, at p. 8).
The Court agrees because Plaintiffs have not opposed Defendant’s motion with additional facts
to place the arbitration provision in issue, but have, instead, raised a legal argument challenging
the validity and enforceability of the provision. See Checchia v. Solo Funds, 2023 WL 3868269,
at *5 (E.D. Pa. June 7, 2023) (concluding that Rule 12(b)(6) standard applies because the
defendant attached its Terms, which included the arbitration provision in question, as well as an
affidavit explaining that a user must check off a box agreeing to the Terms and Conditions before
creating an account, and the plaintiff failed to respond with additional facts sufficient to place the
arbitration provision in issue). See also Silfee v. Automatic Data Processing, Inc., 696 Fed.
Appx. 576, 578 (3d Cir. 2017) (If a party attaches an “authentic arbitration agreement” to a
motion to compel arbitration, the court must apply the Rule 12(b)(6) standard unless the plaintiff
“regpond[s] to a motion to compel arbitration with additional facts sufficient to place the
agreement to arbitrate in issue”); Parker v. Briad Wenco, LLC, 2019 WL 2521537, at *2 (E.D.
Pa. May 14, 2019) (“Ifa party attaches an authentic arbitration agreement to a Motion to Compel
arbitration, the Court must apply the Rule 12(b)(6) standard unless the plaintiff responds to a
motion to compel arbitration with additional facts sufficient to place the agreement to arbitrate in
issue”).
“The test in reviewing a motion to dismiss for failure to state a claim under Rule 12(b)(6)
is whether, under any ‘plausible’ reading of the pleadings, the plaintiff would be entitled to
relief.” Guidotti, 716 F.3d at 772 (citation omitted). “Accordingly, when applying the Rule

>

12(b)(6) standard to a motion to compel arbitration, courts should examine whether there can be
no reading of the Complaint that could rightly relieve Plaintiff of the arbitration provision.”
Parker, 2019 WL 2521537, at *2 (citation and internal quotations omitted).
B. Analysis
1. FAA Standards
The FAA “establishes a strong federal policy in favor of compelling arbitration over
litigation.” Sandvik AB v. Advent Int'l Corp., 220 F.3d 99, 104 (3d Cir. 2000). The Act “places
arbitration agreements on an equal footing with other contracts and requires courts to enforce
them according to their terms.” Rent-A-Center, W.., Inc. v. Jackson, 561 U.S. 63, 67 (2010).
Thus, the Court “must resolve ‘any doubts concerning the scope of arbitrable issues ... in favor of
arbitration.’” CardioNet, Inc. v. Cigna Health Corp., 751 F.3d 165, 172 d Cir. 2014) quoting
Moses H. Cone Mem’! Hosp. v. Mercury Const. Corp., 460 U.S. 1, 24-25 (1983).
Section 4 of the FAA provides that “[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 ... for an order directing that such arbitration. proceed in the manner provided
for in such agreement.” 9 U.S.C. § 4. Because “arbitration is a matter of contract ... [and is}
predicated upon the parties’ consent,” a court ruling on a motion to compel under § 4 must first
determine if the parties intended to arbitrate the dispute. Guidotti, 716 F.3d at 771 (citations
omitted). Specifically, a court must determine “(1) whether a valid agreement to arbitrate exists

and (2) whether the particular dispute falls within the scope of that agreement.” Trippe Mfg. Co.

v. Niles Audio Corp., 401 F.3d 529, 532 (3d Cir. 2005). “If the response is in the affirmative on
both counts, then the [FAA] requires the court to enforce the arbitration agreement in accordance
with its terms.” Santana v. A.L. Recovery, LLC., 2018 WL 3912830, at *6 (W.D. Pa. Aug. 16,
;

2018), quoting Century Indem. Co. v. Certain Underwriters at Lloyd’s, 584 F.3d 513, 527 (3d
Cir. 2009).
Here, as to the second prong, Plaintiffs has not disputed Defendant’s contention that the
subject matter of their claims falls within the scope of the purported arbitration agreement.
Rather, Plaintiffs argue that the arbitration agreement is invalid and unenforceable because they
“did not knowingly waive their constitutional rights” to a jury trial and “took no action to
unambiguously manifest assent” to arbitrate their claims. Thus, the sole issue to be determined
by the Court is whether a valid and enforceable arbitration agreement exists.
2. Choice of Law
Under the FAA, “{a] federal court must generally look to the relevant state law on the
formation of contracts to determine whether there is a valid arbitration agreement.” Blair v. Scott
Specialty Gases, 283 F.3d 595, 603 (3d Cir. 2002), citing First Options of Chicago, Inc. v.
Kaplan, 514 U.S. 938, 944 (1995). Here, Defendant argues that New Jersey law applies, based on

a provision in each of Plaintiffs’ loan agreements that states, in pertinent part, “The provisions of
this Agreement will be governed by federal laws and, to the extent that state law applies and is

not preempted by federal law, the laws of the State of New Jersey, without regard to any
principle of conflicts of laws that would require or permit the application of the laws of any other
jurisdiction.” (See, ¢.g., ECF No. 10-1, at p. 13, § 24). “In evaluating whether a contractual
choice-of-law clause is enforceable, federal courts sitting in diversity apply the choice-of-law
rules of the forum state.” Homa v. American Express Co., 558 F.3d 225, 227 (3d Cir.
2009) (citations omitted).
With respect to contract cases, Pennsylvania courts have adopted §187 of the
Restatement (Second) of Conflict of Laws, which generally honors the intent of the contracting

parties and enforces choice of law provisions in contracts executed by them. Kruzits v. Okuma
Mach. Tool, Inc.; 40 F.3d 52, 55 (3d Cir. 1994), citing Smith v. Commonwealth National Bank,
557 A.2d 775, 777 (Pa.Super.1989) appeal denied, 524 Pa. 610, 569 A.2d 1369 (Pa.1990).
“However, the extent to which, and to what types of claims, Pennsylvania courts will apply a
choice of law provision in a contract is determined by a number of factors.” Grimm V. Discover
Fin. Servs., 2008 WL 4821695, at *8 (W.D. Pa. Nov. 4, 2008). “One such factor is the breadth of
the contractual choice of law provision.” Id.
“Pennsylvania courts analyze choice of law provisions to ‘determine, based on their

narrowness or breadth, whether the parties intended to encompass all elements of their
association.’” Id., quoting Comosiflex, Inc. v. Advanced Cardiovascular Systems, Inc., 795
F.Supp. 151, 157 (W.D.Pa.1992). “Narrow choice of law provisions stating that a contract's
terms or enforcement are to be governed, or construed, by the laws of another state are generally
interpreted by Pennsylvania courts to relate only to the construction and interpretation of the

contract at issue.” Id., citing Jiffy Lube Int'l, Inc. v. Jiffy Lube of Pa., Inc., 848 F.Supp. 569
(E.D.Pa.1994).
For instance, in Coram Healthcare Corp. v. Aetna U.S. Healthcare Inc., 94 F.Supp.2d 589
(E.D. Pa. 1999), the court held that a choice of law provision that stated “[t]his agreement shall
be governed by the state of Delaware” applied only to claims relating to the parties' rights and
duties under the contract itself. Id. at 594. The court found that had the parties wanted the choice
of law provision to apply to other matters, such as the validity of the contract, they could have
inserted language that Delaware law governed “all matters, including, but not limited to, matters
of validity, construction, effect or performance.” Id. (emphasis in original). See also Sherwin-
Williams Co. v. Bei Enterprises, Inc., 2012 WL 5990313, at *2 (W.D. Pa. Nov. 3, 2012) (finding
.

that a contractual choice of law provision stating “This Agreement shall be governed by the
internal laws of the State of Ohio” was “not dispositive” of claims challenging the validity of the
agreement itself); Hite v. Lush Internet Inc., 244 F.Supp.3d 444, 450 n.3 (D.N.J. 2017) (noting
would be anomalous to apply a contract’s choice of law provision unless it has first been
ascertained that the disputed contract exists); Board of Educ. of the Twp. of Cherry Hill, Camden
Cty v. Human Resource Microsystems, Inc., 2010 WL 3882498, at *4 (D.N.J. Sept. 28, 2010)
(finding “it would not be logical to import a contractual choice-of-law clause into a circumstance
in which Plaintiff seeks to establish that there is no contract”).
Because the contractual choice-of-law provision in this case is narrowly drawn to govern
only the provisions of the agreement, without regard to the validity of the agreement itself, it is
inapplicable to Plaintiff's challenge to the validity and enforceability of the arbitration agreement
Defendant seeks to enforce.
When a choice of law provision in a contract does not apply to particular claims, as is the

case here, the claims not covered by the provision must be analyzed under the factors set forth by
the United States Court of Appeals for the Third Circuit in Hammersmith v. TIG Insur. Co., 480
F.3d 220 (3d Cir.2007). In the first part of this analysis, a court must determine if there is an
actual or real difference between potentially applicable laws. Hammersmith, 480 F.3d at
230, citing Air Prods. & Chems., Inc. v. Eaton Metal Prods. Co., 272 F.Supp.2d 482, 490 n. 9
(E.D.Pa.2003) (explaining that courts must determine whether states would actually treat an
issue any differently). If no difference between the applicable laws of each state exists, a choice
of law analysis is unnecessary. Id.
Here, the Court finds that there is no actual conflict between the laws of New Jersey and
Pennsylvania with respect to contract formation. See Chilutti v. Uber Technologies, Inc., 300

A.3d 430, 443 (Pa. Super. 2023) (en banc) (“Under Pennsylvania law, the elements of an
enforceable contract are an offer, acceptance, consideration, or mutual meeting of the minds....
the very essence of an agreement is that the parties mutually assent to the same thin g”)(citations
and internal quotations omitted); Atalese v. U.S. Legal Servs. Grp., L.P., 99 A.3d 306, 312-13
(N.J. 2014) (Under New Jersey law, “A legally enforceable agreement requires a ‘meeting of the
minds’” and “must be the product of mutual assent, as determined under customary principles of

contract law”) (citations and internal quotations omitted). Additionally, Plaintiffs concede that
both Pennsylvania and New Jersey law “require contracts to include explicit waiver-of-rights
language to prove that a consumer assented to waive” the constitutional right to a jury trial, (ECF
No. 12, at p. 10).
Nonetheless, Plaintiffs argue that an “actual conflict” still exists because “Pennsylvania
requires a ‘stricter burden of proof” than New Jersey” regarding a party’s assent to waive
constitutional rights. (Id.). Plaintiffs’ argument in this regard is based upon the Pennsylvania
Superior Court’s recent pronouncement in Chilutti that, in Pennsylvania, “a stricter burden of
proof is necessary to demonstrate a party’s unambiguous manifestation of assent to arbitration.”
300 A.3d at 449-50. According to the Chilutti court, “[t]his is accomplished by the following: (1)
explicitly stating on the registration websites and application screens that a consumer is waiving

a right to a jury trial when they agree to the company's ‘terms and conditions,’ and the
registration process cannot be completed until the consumer is fully informed of that waiver; and
(2) when the agreements are available for viewing after a user has clicked on the hyperlink, the
waiver should not be hidden in the ‘terms and conditions’ provision but should appear at the top
of the first page in bold, capitalized text.” 300 A.3d at 450.

10

However, the precedential effect of this pronouncement is questionable for a number of

reasons, First, the decision is not final, as the appellees in Chilutti filed a petition for allowance
of appeal with the Pennsylvania Supreme Court on August 18, 2023, which remains pending.
Second, it is not at all clear that the Pennsylvania Supreme Court will uphold the Superior
Court’s adoption of a stricter standard in light of the Court’s prior recognition that the United
States Supreme Court “[i]s unsympathetic to [a] state court’s concern for the right to a jury trial”
under the FAA, and that the FAA preempts state laws “that condition|] the enforceability of an
arbitration clause upon a specific notice requirement.” Taylor v. Extendicare Health Facilities,
Inc., 147 A.3d 490, 503, 509 (2016) (citations omitted).? Finally, the Chilutti court’s justification
for applying a stricter standard is flawed. In particular, the court noted that it was “applying the

same scrutiny the Pennsylvania Supreme Court and [the Superior] Court did with respect to
orders compelling arbitration in wrongful death actions involving negligent nursing center
facilities.” Id. at 450 n. 23, citing Pisano v. Extendicare Homes, Inc., 77 A.3d 651 (Pa. Super.
2013) and Taylor, supra. However, both Pisano and Taylor are inapposite, as both cases dealt
with the enforceability of arbitration agreements against wrongful death complainants who were

not parties to the agreements at issue. This Court is unaware of any Pennsylvania Supreme Court
For instance, in Doctor’s Assoc., Inc. v. Casarotto, 517 U.S. 681 (1996), the United States Supreme Court reviewed
the enforceability of a Montana statute that provided: “Notice that a contract is subject to arbitration ... shall be
typed in underlined capital letters on the first page of the contract, and unless such notice is displayed thereon, the
contract may not be subject to arbitration.” Mont. Code Ann. §27-5-114(4). After noting the FAA’s strong policy in
favor of arbitration, the Court concluded that Montana’s statute “directly conflicts with $2 of the FAA because the
State's law conditions the enforceability of arbitration agreements on compliance with a special notice requirement
not applicable to contracts generally. The FAA thus displaces the Montana statute with respect to arbitration.
agreements covered by the Act.” 517 U.S. at 687; see also Kindred Nursing Centers Ltd, Partnership v. Clark, 381
US. 246, 254-55 (2017) (“A rule selectively finding arbitration contracts invalid because improperly formed fares
no better under the [FAA] than a rule selectively refusing to enforce those agreements once properly made’).

11 :

precedent that applies the stricter standard recognized by the Chilutti court to circumstances
similar to those present in this case.
Thus, the Court finds that there is no actual conflict between the laws of New Jersey and
Pennsylvania regarding the issues involved in this case, rendering it unnecessary to conduct any
further choice of law analysis. There being no actual conflict, the Court may apply Pennsylvania
and New Jersey law interchangeably. See Huber v. Taylor, 469 F.3d 67, 74 (3d Cir. 2006) CTE
there is no conflict, then the district court sitting in diversity may refer interchangeably to the
laws of the states whose laws potentially apply”).
3. Application
The Court now considers whether a valid and enforceable agreement to arbitrate exists.
“Although the enforceability of web-based agreements will often depend on a ‘fact-intensive
inquiry,’ the Court may determine that a web-based agreement to arbitrate exists where notice of
the agreement was ‘reasonably conspicuous and manifestation of assent unambiguous as a matter
of law.” HealthplanCRM, LLC v. AvMed, Inc., 458 F.Supp.3d 308, 331 (W.D. Pa. 2020),
quoting Meyer v. Uber Techs., Inc., 868 F.3d 66, 76 (2d Cir. 2017) (citation omitted). “To be
reasonably conspicuous, notice [of an agreement] must be displayed in a font size and format
such that the court can fairly assume that a reasonably prudent Internet user would have seen it.”
Checchia, 2023 WL 3868369, at *9 (citation and internal quotation omitted); see also Liptak v.
Accelerated Inventory Memt, LLC, 2021 WL 650514, at *1 (W.D. Pa. Feb. 19, 2021) (finding
that a borrower agreement not visible on the webpage but available through an un-underlined

green hyperlink was reasonably conspicuous to enforce arbitration agreement contained in the
hyperlinked documents). In general, “clickwrap agreements are routinely enforced by the
courts.” HealthplanCRM, 458 F.Supp.3d at 334.

12

_ “Importantly, in assessing whether a party manifested an intent to enter a [web-based]
contract, the Court looks not to inward, subjective intent but, rather, to the ‘intent a reasonable
person would apprehend in considering the parties’ behavior.” Id., quoting Am. Eagle Outfitters

v. Lyle & Scott Ltd., 584 F.3d 575, 582 (3d Cir. 2009) (citation omitted). Thus, “an internet user
need not actually read the terms and conditions or click on a hyperlink that makes them available

as long as she has notice of their existence.” Liptak v. Accelerated Inventory Mgmt, LLC, 2021
WL 650514, at *2 (W.D. Pa. Feb. 19, 2021), citing Nicosia v. Amazon.com, Inc., 834 F.3d 220,
222 (2d Cir. 2016). “Whether the user actually reads the terms to which she assents is
immaterial.” Id., quoting Zabokritsky v. Jetsmarter, Inc., 2019 WL 2563738, *3 (E.D. Pa. June
20, 2019); see also Feldman, 513 F.Supp.2d at 236 (“Absent a showing of fraud, failure to read

an enforceable clickwrap agreement, as with any binding contract, will not excuse compliance
with its terms”).
Here, Plaintiffs challenge the enforceability of Defendant’s clickwrap agreement, noting
that, while the TIL Statement on Defendant’s website provided a checkbox next to the statement,
“T have read and agree to the E-Sign Act Consent...,” there was no independent checkbox next to
the ensuing paragraph stating, in pertinent part, “I have read The... Loan Agreement ..., and
intend this to be my electronic signature on the Loan Agreement.” (ECF No. 12, at p. 19). Thus,
Plaintiffs argue that they “took no action to unambiguously manifest assent to arbitrate their
claims” because they “were not asked to check a box indicating that they agreed to the “Loan
Agreement.” (Id. at pp. 19-20). This argument is unavailing.
While the Court acknowledges that the TIL Statement does not provide a second
checkbox next to the paragraph stating, “I have read The... Loan Agreement...,” it does provide
an introductory statement immediately above the checkbox provided, which states, in bold type:

13

“By clicking the checkbox and the Accept and Submit button below, I am telling you that:”.
This statement was sufficient to put the Plaintiffs on notice that the act of clicking the checkbox
next to the statement “I have read and agree to the E-Sign Act Consent...” also meant that they
were acknowledging they “read The ... Loan Agreement...,” both of which were then
confirmed by the Plaintiffs’ further act of clicking the “Accept and Submit” button that was
highlighted in orange at the bottom of the page. Moreover, the term “Loan Agreement” was set
apart from the surrounding text by being placed in underlined, bold type, signifying a hyperlink
to the full Loan Agreement containing the arbitration provision at issue.
Thus, the Court finds that the hyperlinks to the Agreements were reasonably conspicuous
such that a reasonably prudent Internet user would have seen them and clicked on them if they
chose to avail themselves of the opportunity to read the Agreements they acknowledged they had
read by clicking the checkbox and “Accept and Submit” button. Compare Hine v. LendingClub
Corp., 2023 WL 8223234, at *7 (W.D. Pa. Nov. 22, 2023) (“While the Loan Agreement and
Borrower Membership Agreement hyperlinks are not underlined or in bold font, it would be
readily apparent to a reasonably prudent Internet user that distinct green font used for document
descriptions like “Loan Agreement” and “Borrower Membership Agreement” while all other
surrounding text is in black font would contain hyperlinks). It is undisputed that Plaintiffs would

not have been able to obtain each of their loans without selecting the electronic signature box and
selecting the “Accept and Submit” button. Moreover, because Plaintiffs did not have to actually
read the terms and conditions or click on the hyperlink containing the Agreements to be bound
by the terms therein, mutual assent exists here.

14

For the foregoing reasons, the Court finds that Plaintiffs are bound by the arbitration
provisions contained within the loan agreements that were conspicuously hyperlinked on
Defendant’s website. Additionally, the Court finds that the arbitration provisions prominently
displayed in all capitalized terms “clear and unambiguous language that the [P]laintiff[s] ...
waivefed] [their] right to sue or got to court to secure relief.” Atalese, 99 A.3d at 31 5-16.
Consequently, the Court will grant Defendant’s motion to compel arbitration on an individual
basis.
An appropriate Order follows.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10668106. Public record. Not legal advice.