Plaintiff Was Told of Arbitration Rule in ‘Multiple Conspicuous Ways,’ Says Samsung

Plaintiff Antonio Lewis’ putative class action alleging Samsung duped consumers into believing its Galaxy Z Fold3 foldable smartphone was more durable than it really was should be dismissed and his claims should be sent to an arbitrator, said Samsung’s memorandum Monday (docket 1:22-cv-10882) in U.S. District Court for Southern New York in support of its motion to compel arbitration. Lewis’ opposition to the motion is due June 15 (see 2303150020).

Lewis alleges Samsung’s Z Fold3 durability claims are false because they’re premised on unrealistic testing methods. He further alleges Samsung breached the cellphone’s warranty when it charged him for the costs to repair his Z Fold3’s screen damage. His theories “suffer numerous fatal defects,” said Samsung’s memorandum. “But to start, all the claims must be resolved through arbitration under the Z Fold3’s terms and conditions, it said.

Lewis was informed in “multiple conspicuous ways” that using and keeping the device “constituted acceptance of an agreement to arbitrate any claims that might arise,” said the memorandum. Though Lewis was “repeatedly informed” he could opt out of the arbitration agreement within 30 days of buying his Z Fold3, “he elected not to do so,” it said. By “affirmatively agreeing” to the arbitration agreement, using and retaining the Z Fold3 and then failing to opt out, Lewis “assented to the arbitration agreement," it said.

The existence of a valid agreement to arbitrate between the parties is “dispositive,” said the memorandum. Because the arbitration agreement delegates to the arbitrator the issue of whether it encompasses Lewis’ claims, the court “has no occasion to reach the issue,” it said. But should the court do so nonetheless, Lewis’ claims “fall neatly” within the arbitration agreement’s scope, and he “must therefore arbitrate the claims he advances in this case,” it said.

Courts within the 2nd Circuit “routinely compel arbitration involving less decisive assent and less extensive notice of the contract’s terms,” said the memorandum. Courts around the U.S. have enforced “virtually identical agreements” between Samsung and its product users, and compelled the parties to arbitrate their disputes, it said. The Southern District of New York “should do the same,” it said.

The court can enforce the arbitration agreement based on “three independent grounds,” said the memorandum. Courts routinely enforce “shrinkwrap” agreements, where notice is provided on the outside of the box, it said. There also are shrinkwrap agreements, where notice is provided “on materials accompanying the product inside the box,” it said. And finally there are “clickwrap” agreements, where notice is provided “electronically and users manifest their assent by clicking a box or button,” it said. The facts “at bar” present all three scenarios, “thus creating an enforceable agreement in three ways -- any one of which would independently require arbitration,” it said.