Altice USA, Inc., D/B/A Suddenlink Communications v. Ronnie Francis and Debbie Francis ( 2023 )

Cite as 2023 Ark. App. 117ARKANSAS COURT OF APPEALS
DIVISION II
No. CV-21-33
ALTICE USA, INC., D/B/A Opinion Delivered March 1, 2023
SUDDENLINK COMMUNICATIONS
APPEAL FROM THE CLARK
COUNTY CIRCUIT COURT
APPELLANT [NO. 10CV-20-96]
V. HONORABLE C.A. BLAKE BATSON,
JUDGE
RONNIE FRANCIS AND DEBBIE
FRANCIS
APPELLEES REVERSED AND REMANDED
CINDY GRACE THYER, Judge
The appellant, Altice USA, Inc., does business in Arkansas as Suddenlink
Communications (Suddenlink). Suddenlink provides cable television, internet, and
telephone services to subscribing customers throughout Arkansas. Appellees Ronnie Francis
and Debbie Francis filed a complaint in the Clark County Circuit Court alleging that they
were entitled to damages for alleged breach of contract and violations of the Arkansas
Deceptive Trade Practices Act.
Suddenlink unsuccessfully moved to compel arbitration in circuit court, and pursuant
to Arkansas Code Annotated section 16-108-228 (Repl. 2016) and Rule 2(a)(12) of the
Arkansas Rules of Appellate Procedure–Civil, it now takes this appeal. As we do in four
other cases that we decide today on similar facts, we reverse and remand.1
I. Factual Background
The Francises subscribed to Suddenlink’s internet and television services on a month-
to-month basis. On July 29, 2020, they filed a complaint alleging that they “regularly
experience service problems and outages,” and in the last year, had lost service “dozens of
times.” The Francises also claimed that Suddenlink regularly imposed late fees on their
account “even though [they had] made timely monthly payments[.]” They said that their
monthly bill inexplicably increased seventy dollars in April 2020, and several attempts to
contact Suddenlink—even through the Federal Communications Commission—were
unsuccessful. They further alleged that despite their timely payments, Suddenlink
disconnected their service in July 2020 without prior notice, forcing them to pay additional
reconnection fees. The Francises also claimed that they never received a discount or credit
to compensate them for the outages that they experienced. They asserted that, as a result,
they were entitled to damages for alleged violations of the Arkansas Deceptive Trade
Practices Act and for breach of contract.
Suddenlink moved to compel arbitration on September 3, 2020, claiming it had a
valid arbitration agreement with the Francises. Its arguments in the Francis case were nearly
1
See Altice USA, Inc. v. Johnson, 2023 Ark. App. 120; Altice USA, Inc. v. Peterson, 2023
Ark. App. 116; Altice USA, Inc. v. Campbell, 2023 Ark. App. 123; Altice USA, Inc. v. Runyan,
2023 Ark. App. 124.
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identical to those it made in its motion to compel arbitration in Altice USA, Inc. v. Peterson,
2023 Ark. App. 116, which we also decide today. Specifically, Suddenlink offered proof that
Ms. Francis signed an installation work order (including the same acknowledgment that she
had read and agreed to the general terms and conditions that the service technician provided
on an iPad or iPhone) when the Francises transferred their service to a new address on
February 25, 2020. Suddenlink also argued that the Francises had confirmed their agreement
to binding arbitration when they paid their monthly bills from January 2020 to July 2020,
as those bills provided that payment of the bill confirmed their acceptance of the Residential
Services Agreement (RSA) viewable on Suddenlink’s website.
The Francises filed a response to Suddenlink’s motion to compel arbitration on
September 16, 2020. The Francises claimed that they never agreed to submit to arbitration
and that Suddenlink had failed to offer proof—as they said it must—of any written agreement
between the parties. In support of their response, Ms. Francis executed an affidavit in which
she acknowledged that a technician came to their new home to transfer their internet and
television service. She claimed that the technician “was there about ten minutes and then
left” and that “he did not give us any paperwork of any kind.” Ms. Francis also testified that
she reviewed the installation work order bearing her signature but did not “remember ever
seeing that document and . . . never got a copy of it.” Ms. Francis concluded her affidavit by
declaring that “she never agreed to arbitrate any dispute with Suddenlink,” and “no one
from Suddenlink has ever mentioned arbitration to me.”
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The circuit court denied Suddenlink’s motion to compel arbitration in an order
entered on December 14, 2020. Suddenlink now appeals this order, arguing that the
Francises manifested their agreement to the arbitration provision when they paid monthly
invoices referring them to the Residential Services Agreement (RSA) on its website.
Suddenlink also asserts that the claims that the Francises filed in the circuit court are within
the arbitration agreement.2
The Francises respond that the circuit court did not err when it denied Suddenlink’s
motion to compel arbitration. First, they insist that they had no reason to believe that they
were under contract with Suddenlink because the provider routinely advertises that it offered
its services on a “no contract” basis and because there was no proof that they assented to a
written agreement to arbitrate. The Francises further contend that their payment of their
monthly bills falls short of manifesting their assent because they are not contracts. According
to the Francises, the bills contain only “unexplained charges which Suddenlink claims to be
owed,” and they “impose no obligation on Suddenlink[.]” The Francises also claim that the
bills fail to unequivocally incorporate the terms of the RSA—even if they could be considered
contracts themselves.
2
As we do in Altice USA, Inc. v. Peterson, 2023 Ark. App. 116, we address Suddenlink’s
argument concerning the scope of the arbitration agreement because it briefed the issue
below and because the circuit court did not make any specific findings in support of its denial
of the motion to compel arbitration. See Asset Acceptance, LLC v. Newby, 2014 Ark. 280, at
6–7, 437 S.W.3d 119, 123.
4
The Francises alternatively argue that even if they manifested their assent to the RSA,
the arbitration clause is unenforceable for several reasons. First, they contend that the RSA
as a whole lacks mutuality of obligation because it reserves to Suddenlink “the right to
unilaterally change any portion of the terms at any time” and imposes a host of obligations
on subscribers that it does not also impose on Suddenlink. The arbitration clause itself also
lacks mutuality of obligation because, according to the Francises, other terms in the RSA
allow Suddenlink to bypass arbitration in favor of charging late fees; terminating service;
referring accounts to collection agencies; and limiting the customer’s ability to dispute
charges. The Francises also suggest that the arbitration clause is substantively and
procedurally unconscionable and that Suddenlink has failed to establish that its franchise
agreement with the city of Arkadelphia “would allow it to force Arkadelphia citizens into
arbitration.”
II. Standards of Review
“Arkansas strongly favors arbitration as a matter of public policy” as “a less expensive
and more expeditious means of settling litigation and relieving docket congestion.” Jorja
Trading, Inc. v. Willis, 2020 Ark. 133, at 2, 598 S.W.3d 1, 4. We review denials of motions to
compel arbitration “de novo on the record.” Id. at 3, 598 S.W.3d at 4. That generally means
that this court “is not bound by the circuit court’s decision, but in the absence of a showing
that the circuit court erred in its interpretation of the law, this court will accept its decision
as correct on appeal.” Erwin-Keith, Inc. v. Stewart, 2018 Ark. App. 147, at 9, 546 S.W.3d 508,
512.
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Arbitration agreements are governed by the Federal Arbitration Act (FAA), which
makes them “valid, irrevocable, and enforceable, save upon such grounds as exist at law or
in equity for the revocation of any contract.” Jorja Trading, 2020 Ark. 133, at 3, 598 S.W.3d
at 4 (quoting 9 U.S.C. § 3). “The primary purpose of the FAA is to ensure that private
agreements to arbitrate are enforced according to their terms,” and “any doubts and
ambiguities will be resolved in favor of arbitration.” Id. (internal citations and quotation
marks omitted).
In deciding whether to grant a motion to compel arbitration, two threshold questions
must be answered. Courtyard Gardens Health and Rehab., LLC v. Arnold, 2016 Ark. 62, at 7,
485 S.W.3d 669, 674. The first question is whether there is a valid agreement between the
parties. Id. If such an agreement exists, the second question is whether disputes fall within
the scope of the agreement. Id.“When deciding whether the parties agreed to arbitrate a certain matter, ordinary
state-law principles governing contract formation apply.” Id. at 3, 598 S.W.3d at 4–5. “In
Arkansas, the essential elements of a contract are: (1) competent parties; (2) subject matter;
(3) consideration; (4) mutual agreement; and (5) mutual obligations.” Id. at 4, 598 S.W.3d
at 5.
III. Discussion
A. Agreement to Arbitrate
Suddenlink first argues that the circuit court erred by denying its motion to compel
arbitration because it demonstrated that it had a valid agreement to arbitrate with Mr. and
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Ms. Francis. Specifically, Suddenlink contends that the Francises manifested their agreement
to the terms and conditions in the RSA, including the arbitration provision, when they paid
their monthly invoices directing them to the RSA on Suddenlink’s website. We agree.
This case is controlled by our contemporaneous decision in Altice USA, Inc. v. Johnson,
2023 Ark. App. 120. There, we held that Ms. Johnson assented to the terms and conditions
in the RSA when she paid her monthly invoices, which, like the invoices at issue here,
directed Ms. Johnson to the RSA on Suddenlink’s website and provided that payment of her
bill was confirmation of her agreement to those terms. Consequently, we apply Johnson here
to hold that the Francises, who did not dispute paying the invoices they received from
Suddenlink from January 2020 to July 2020, manifested their assent to the terms of the RSA,
including the arbitration provision.
B. Defenses to Enforcement of the Arbitration Agreement
We also hold, in light of our decision in Johnson, that the Francises’ defenses against
enforcement of the arbitration provision are without merit. That is, Johnson directs our
conclusion that the RSA, as it appears on Suddenlink’s website, meets the FAA’s
requirement that arbitration provisions must be written. See id. at 11–12. Johnson also
compels our holding that the absence of a signed writing does not violate a recent
amendment to the statute of frauds. See id. at 12–13. Johnson further directs our conclusions
that the Francises’ challenges to the mutuality of obligation supporting the RSA as a whole
(and its alleged unconscionability) are outside the scope of our review, see id. at 14–15, and
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that their argument based on Arkadelphia’s franchise agreement with Suddenlink lacks
merit. See id. at 18.
That leaves the Francises’ arguments concerning the alleged lack of mutuality of
obligation in the arbitration agreement itself, which we perceive to be the same as the
challenge we rejected in Altice USA Inc. v. Peterson, 2023 Ark. App. 116, as well as the alleged
unconscionability of the arbitration clause, which is dependent on our examination of the
proof admitted in this particular case. We find both to be without merit. 3
As we observe in Johnson and Peterson, “[m]utuality of obligations means an obligation
must rest on each party to do or permit to be done something in consideration of the act or
promise of the other; thus, neither party is bound unless both are bound.” Jorja Trading, 2020
Ark. 133, at 4, 598 S.W.3d at 5 (internal quotation marks omitted). “It requires that the
terms of the agreement impose real liability upon both parties.” Id. “[A] contract that
provides one party the option not to perform his promise would not be binding on the
other.” Id.
The Francises’ argument against the mutuality of the arbitration provision must meet
the same fate as the appellee’s argument in Peterson. As we state there, the fact that
Suddenlink may use other measures to resolve disputes before resorting to arbitration,
including late fees, cancellation, and collection, has no relevance to our analysis—which looks
3
The breach-of-contract claim in the Francises’ complaint affirms the existence of a
contract with Suddenlink and, in our view, suffices to reject their argument based on
Suddenlink’s “no contract” advertising.
8
only at the terms of the arbitration agreement itself. See Peterson, 2023 Ark. App. 116, at 9.
Further, as we observe in Johnson, 2023 Ark. App. 120, at 16, those terms do not operate to
shield only Suddenlink from litigation. The terms allow both Suddenlink and the subscriber
to file their disputes in small claims court in appropriate cases, and each must otherwise
submit to arbitration. Therefore, we find no merit to the Francises’ argument challenging
the mutuality of obligation in the arbitration agreement.
We are likewise unpersuaded by the Francises’ suggestion that the arbitration
agreement is procedurally and substantively unconscionable. As the appellees first argued in
Johnson, the Francises contend that the arbitration agreement is substantively unconscionable
because it prohibits class actions and non-individualized relief (relief that would affect other
subscribers in addition to the subscriber that is a party to the dispute). They also assert that
the arbitration provision is procedurally unconscionable because the opt-out clause, which
may save these provisions, is too difficult to invoke. Last, they suggest that the provision in
the RSA that allows Suddenlink to unilaterally modify its terms makes the RSA as a whole
unconscionable (if not also defeating mutuality of obligation).
As we observe in Johnson and Peterson, the Francises’ argument regarding the
unconscionability of the RSA as a whole is outside the scope of our review. See Johnson, 2023
Ark. App. 120, at 17; Peterson, 2023 Ark. App. 116, at 10. Their claims against the terms in
the arbitration provision, moreover, must suffer the same fate as they did in Johnson and
Peterson. Like the appellees there, the Francises do not point to any individualized proof that
they have been (or will be) adversely affected by the class-action waiver, the clause prohibiting
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non-individualized relief, or the opt-out clause. Accordingly, we must reject their argument
as also lacking merit.
C. Scope of the Arbitration Provision
Suddenlink next contends the circuit court erred in denying the motion to compel
arbitration when it found the Francises’ claims were outside the scope of the arbitration
provision. We agree.
As we first observe in Peterson, 2023 Ark. App. 116, at 10, the arbitration provision
in the RSA is “intended to be broadly interpreted” and requires “any and all disputes arising
between [the subscriber] and Suddenlink” to be arbitrated. The provision further provides
that the agreement to arbitrate “includes, but is not limited to claims arising out of or relating
to any aspect of the relationship between [the subscriber and Suddenlink] whether based in
contract, statute, fraud, misrepresentation, or any other legal theory[.]” The agreement also
includes “claims that arose before this or any other prior agreement” as well as “claims that
may arise after the termination of [the agreement to arbitrate].”
The claims in the Francises’ complaint alleging breach of contract and violation of
the Arkansas Deceptive Trade Practice Act clearly fall within the broad scope of the RSA’s
arbitration provision, and the Francises do not make any argument to the contrary here.
Accordingly, inasmuch as the circuit court denied the motion to compel arbitration on the
basis of its conclusion that the Francises’ claims were outside the scope of the agreement, we
must reverse.
IV. Conclusion
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The circuit court erred when it denied Suddenlink’s motion to compel arbitration.
The Francises’ payment of the invoices that they received from Suddenlink, which directed
them to the RSA available on Suddenlink’s website, manifested their assent to its terms, and
the arbitration provision otherwise appears in writing on Suddenlink’s website and is
supported by mutuality of obligation. The Francises’ arguments urging us to affirm also lack
merit.
Reversed and remanded.
WOOD and BROWN, JJ., agree.
Husch Blackwell LLP, by: Laura C. Robinson and Mark G. Arnold, pro hac vice; and
McMillan, McCorkle & Curry, LLP, by: F. Thomas Curry, for appellant.
Thrash Law Firm, P.A., by: Thomas P. Thrash and Will Crowder; and Turner & Turner,
PA, by: Todd Turner, for appellees.
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