Holmes v. Henry Legal Grp., LLP

Full title: DEBBIE HOLMES, on behalf of herself and all similarly situated individuals, Plaintiff, v. HENRY LEGAL GROUP, LLP and HEARTLAND LEGAL GROUP Defendants.

Court: UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION

Date published: Jul 6, 2021

Facts

Plaintiff Debbie Holmes is a former client of Defendant Henry Legal Group, d/b/a Heartland Legal Group (“Heartland”). Plaintiff retained Heartland to help her get out of debt and improve her credit score. Ultimately dissatisfied with Heartland’s legal representation (the merits  of Plaintiff’s claims are not the subject of this motion), Plaintiff filed claims on behalf of herself and a putative nationwide class of Heartland clients alleging violations of the Credit Reporting Organizations Act (Count 1), and on behalf of herself and a putative Tennessee class of Heartland clients for alleged violations of the Tennessee Credit Services Business Act (Count 2) and the Tennessee Consumer Protection Act (Count 3). (Am. Compl., Doc. No. 26).

The Client Retainer Agreement between Plaintiff and Heartland contains an Arbitration Agreement. (See Doc. No. 32-1). Defendant now seeks to enforce the Arbitration Agreement, compel arbitration, and stay the case. Plaintiff does not dispute that she signed the Retainer Agreement, or that the arbitration agreement, if enforceable, covers the claims in this case.

The Arbitration Agreement requires arbitration of “[a]ny controversy, claim or dispute between Client, on the one hand, and Heartland, any of its attorneys, and/or any of its third-party service providers, on the other hand, arising out of or relating to this agreement or the breach, termination, enforcement, performance, interpretation or validity thereof, including any determination of the scope or applicability of this agreement to arbitrate…” (Doc. No. 32-1 at 20). The Arbitration Agreement waives the right to pursue claims as a class action and provides that Plaintiff and Heartland will share the costs of arbitration equally up to $1,000; amounts in excess of $1,000 will be paid by Heartland. (Id.). It further provides that each party will bear their own attorneys’ fees and costs. (Id.).

Plaintiff initialed the Arbitration Agreement and signed the Retainer Agreement in the presence of a non-attorney Heartland representative. The plaintiff states that the representative was unable to answer her question about a specific monetary charge in the Agreement. (Comp., Doc. No. 26, ¶ 37-39). Plaintiff does not allege that she asked any other questions that the representative was unable to answer, but states generally that the non-attorney representative was unable to provide legal advice about the documents. (Id.).

The day after she signed the Retainer Agreement, Plaintiff spoke with Brandon Chabner, a Heartland attorney. (Chabner Decl., Doc. No. 32, ¶ 5). Plaintiff did not raise any questions or concerns regarding the Arbitration Agreement at that time. (Id.).

Plaintiff states that at the time she signed the Retainer Agreement, she did not understand that she “was being asked to waive [her] right to be protected by the judicial system” and that she did not know she “was being asked to waiver important statutory protections like the ability to recover attorneys’ fees under consumer protection laws.” (Holmes Decl., Doc. No. 38-1, ¶¶ 3, 4). She states that she was never told that signing the agreement would waive these protections. (Id., ¶ 6).

Issue

Decision

The Court finds that Plaintiff has not raised a genuine issue of material fact regarding the validity of the arbitration agreement. Accordingly, the Motion to Stay and Compel Arbitration (Doc. No. 30) will be GRANTED. Lehman Bros., 394 F.3d at 451 (where a party establishes that there is a valid agreement to arbitrate the dispute, the Court must grant the motion to compel arbitration). In light of this ruling, the Court will not address the merits of Plaintiff’s underlying claims. An appropriate Order will be entered.

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