Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JULIA ROSE DOUGLAS, Case No.: 26-cv-3095-RSH-DEB 12 Plaintiff, ORDER GRANTING DEFENDANT’S 13 v. MOTION TO COMPEL ARBITRATION 14 CREDIT ACCEPTANCE CORPORATION, 15 [ECF No. 6] Defendant. 16 17 18 19 Pending before the Court is a motion to compel arbitration filed by defendant Credit 20 Acceptance Corporation. ECF No. 6.1 For the reasons below, the Court grants Defendant’s 21 motion. 22 I. BACKGROUND 23 In April 2020, Plaintiff purchased a vehicle from SD Motor Group, Inc. (“SDMG”) 24 and financed her purchase by entering into a retail installment contract (“RIC”) with the 25 26 27 1 All citations to electronic case filing (“ECF”) entries refer to the ECF-generated page 28 1 dealership. See ECF No. 6-1. The RIC was assigned to defendant Credit Acceptance 2 Corporation. Id. 3 On May 18, 2026, Plaintiff filed this action against Defendant claiming violations 4 of the Fair Credit Reporting Act (“FCRA”). ECF No. 1. On July 2, 2026, Defendant filed 5 this motion to compel arbitration. ECF No. 6. Plaintiff did not file an opposition. 6 Defendant argues that Plaintiff agreed to arbitration by signing the RIC containing 7 an arbitration provision (the “Arbitration Clause”). Id. at 7. The first page of the RIC states: 8 “[t]his Contract contains an Arbitration Clause that states You and We may elect to resolve 9 any dispute by arbitration and not by court action. See the Arbitration Clause on Page 6[.]” 10 ECF No. 6-1 at 4. The Arbitration Clause on page six of the RIC states, in relevant part: 11 This Arbitration Clause describes how a Dispute (as defined below) may be arbitrated. Arbitration is a method of resolving disputes in front 12 of one or more neutral persons, instead of having a trial in court in front 13 of a judge and/or jury. In this Arbitration Clause, “We” and “Us” mean Seller and/or Seller’s assignee (including, without limitation, Credit 14 Acceptance Corporation) or their employees, assignees, or any third 15 party providing any good or services in connection with the origination, servicing and collection of amounts due under the Contract if such third 16 party is named as a party between You and Us. “You” and “Your” 17 means each Buyer named on page 1. 18 Id. at 9. The term “dispute” is defined to include: 19 [A]ny controversy or claim between You and Us arising out of or in 20 any way related to this Contract, including, but not limited to, any default under this Contract, the collection of amounts due under this 21 Contract, the purchase, sale, delivery, set-up, quality of the Vehicle, 22 advertising for the Vehicle or its financing, or any product or service in this Contract. “Dispute” shall have the broadest meaning possible, and 23 includes contract claims, and claims based on tort, violations of laws, 24 statutes, ordinances or regulations or any other legal or equitable theories. 25 Id. 26 /// 27 /// 28 1 II. LEGAL STANDARD 2 The Federal Arbitration Act (“FAA”) governs arbitration agreements contained in 3 commercial contracts. 9 U.S.C. § 2. The FAA “was enacted . . . in response to widespread 4 judicial hostility to arbitration agreements.” AT&T Mobility LLC v. Concepcion, 563 U.S. 5 333, 339 (2011). It “reflect[s] both a ‘liberal federal policy favoring arbitration,’ and the 6 ‘fundamental principle that arbitration is a matter of contract[.]’” Id. (citations omitted) 7 (quoting Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983)). 8 The FAA provides that “[a] written provision in . . . a contract evidencing a transaction 9 involving commerce to settle by arbitration a controversy thereafter arising out of such 10 contract . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist 11 at law or in equity for the revocation of any contract[.]” 9 U.S.C. § 2. The FAA “requires 12 courts ‘rigorously’ to enforce arbitration agreements according to their terms, including 13 terms that specify with whom the parties choose to arbitrate their disputes and the rules 14 under which that arbitration will be conducted.” Epic Sys. Corp. v. Lewis, 584 U.S. 497, 15 506 (2018) (citations omitted). 16 A federal court “must compel arbitration if (1) a valid agreement to arbitrate exists 17 and (2) the dispute falls within the scope of that agreement.” Geier v. m-Qube Inc., 824 18 F.3d 797, 799 (9th Cir. 2016). “Any doubts concerning the scope of arbitrable issues should 19 be resolved in favor of arbitration.” Simula v. Autoliv, Inc., 175 F.3d 716, 719 (9th Cir. 20 1999) (citing Moses H. Cone, 460 U.S. at 24-25). The court, “upon being satisfied that the 21 issue involved . . . is referable to arbitration, shall on application of one of the parties stay 22 the trial of the action until such arbitration has been had in accordance with the terms of 23 the agreement[.]” 9 U.S.C. § 3. 24 III. ANALYSIS 25 A. Valid Agreement to Arbitrate 26 The Court first considers whether a valid agreement to arbitrate exists in this case. 27 Because “[a]rbitration is a product of contract,” the Court applies ordinary state law 28 principles to this inquiry. Davis v. Nordstrom, Inc., 755 F.3d 1089, 1092-93 (9th Cir. 2014). 1 The party seeking to compel arbitration bears the burden of proving by a preponderance of 2 the evidence the existence of an agreement to arbitrate. See Ashbey v. Archstone Prop. 3 Mgmt., Inc., 785 F.3d 1320, 1323 (9th Cir. 2015) (citing Cox v. Ocean View Hotel Corp., 4 533 F.3d 1114, 1119 (9th Cir. 2008)). Defendant has provided evidence of an RIC 5 containing an Arbitration Clause. See ECF No. 6-1 at 4-9. Plaintiff signed the RIC and 6 initialed a clause on page one specifically acknowledging that she read, understood, and 7 agreed to the Arbitration Clause. See id. at 4. Defendant has met its burden in demonstrating 8 that a valid arbitration agreement exists. See Landrum v. Mercedes-Benz Fin. Servs. USA 9 LLC, No. 5:24-CV-00533-AB-SP, 2025 WL 3158097, at *7 (C.D. Cal. July 18, 2025). 10 However, Defendant is a non-signatory to the RIC. See ECF No. 6 at 13. “Non- 11 signatories to an arbitration agreement may compel arbitration if relevant state contract law 12 allows the litigant to enforce the agreement.” Shoals v. Owens & Minor Distribution, Inc., 13 No. 2:18-CV-2355 WBS EFB, 2018 WL 5761764, at *8 (E.D. Cal. Oct. 31, 2018) (citation 14 omitted). “California law allows an assignee to step into the shoes of the assignor and 15 assume all rights, privileges, and liabilities[.]” Camarillo v. Balboa Thrift & Loan Ass’n, 16 No. 320CV00913BENBLM, 2021 WL 409726, at *5 n.4 (S.D. Cal. Feb. 4, 2021) (citing 17 Cal. Civ. Code § 1457, § 1458). 18 The Arbitration Clause here recites that it is binding on the seller’s assignee, and 19 indeed specifically mentions Defendant: “[i]n this Arbitration Clause, ‘We’ and ‘Us’ mean 20 Seller and/or Seller’s assignee (including, without limitation, Credit Acceptance 21 Corporation)[.]” ECF No. 6-1 at 9. The RIC also states: “You and We may elect to resolve 22 any dispute by arbitration and not by court action” and a “dispute” includes “any 23 controversy or claim between You and Us arising out of or in any way related to this 24 Contract[.]” Id. at 4, 9. The plain language contemplates arbitration of controversies 25 between the buyer and SDMG, as well as controversies between the buyer and an assignee 26 of SDMG. SDMG assigned the contract to defendant Credit Acceptance Corporation. See 27 id. at 4-9. Defendant is entitled to compel arbitration of Plaintiff’s claims. 28 /// 1 B. Scope of the Agreement 2 To decide whether a dispute must be arbitrated, the Court looks “to the content of 3 the arbitration clause.” Jackson v. Amazon.com, Inc., 65 F.4th 1093, 1101 (9th Cir. 2023). 4 Here, the Arbitration Clause applies to: 5 [A]ny controversy or claim between You and Us arising out of or in any way related to this Contract, including, but not limited to, any 6 default under this Contract, the collection of amounts due under this 7 Contract, the purchase, sale, delivery, set-up, quality of the Vehicle, advertising for the Vehicle or its financing, or any product or service in 8 this Contract. . . . [and] includes contract claims, and claims based on 9 tort, violations of laws, statutes, ordinances or regulations or any other legal or equitable theories. 10 11 ECF No. 6-1 at 9. Plaintiff alleges that Defendant provided inaccurate information to 12 consumer reporting agencies regarding her auto loan account, failed to reasonably 13 investigate account disputes, and failed to disclose the method of verification used to 14 investigate the account. See ECF No. 1 at 2-3. Plaintiff’s claims arise out of the purchase 15 of her vehicle and the auto loan account created by the RIC. See id; ECF No. 6-1. The 16 complaint’s causes of action are also based on violations of a statute, 15 U.S.C. § 1681. Id. 17 Thus, Plaintiff’s claims are related to the RIC and fall within the scope of the Arbitration 18 Clause. See ECF No. 6-1 at 9; Rodney v. Toyota Motor Credit Corp., No. 5:24-CV-02202- 19 AB-SP, 2025 WL 1712384, at *3 (C.D. Cal. Apr. 18, 2025) (finding that statutory claims 20 fell within the scope of a retail installment contract’s arbitration provision because they 21 “[arose] out of and relat[ed] to [plaintiff’s] purchase of the vehicle”); Landrum, 2025 WL 22 3158097, at *7 (same). 23 IV. CONCLUSION 24 For the above reasons, the Court: 25 1. GRANTS Defendant’s motion to compel arbitration [ECF No. 6]. 26 2. ORDERS the Parties to submit to arbitration in the manner provided for in 27 the Arbitration Clause contained in the Retail Installment Contract. 28 3. STAYS this action pending resolution of the arbitration. l 4. ORDERS the Parties to file a joint report, no longer than five (5) pages, 2 ||regarding the status of this action within twenty-one (21) days of the completion of the 3 || arbitration, or within six (6) months from the date of this Order, whichever occurs first. 4 IT IS SO ORDERED. 5 || Dated: September 15, 2026 fekut Howe 6 Hon. Robert S. Huie United States District Judge 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28