Ibarra v. Navient Solutions, LLC

          PRESENT: HONORABLE JOSEPHINE L. STATON, UNITED STATES DISTRICT JUDGE

          CIVIL MINUTES - GENERAL

         PROCEEDINGS: (IN CHAMBERS) ORDER GRANTING PETITION FOR CONFIRMATION OF ARBITRATION AWARD (Doc. 1)

         Before the Court is Petitioner Miguel Ibarra's Petition for Confirmation of Arbitration Award. (Petition, Doc. 1.) Respondent Navient Solutions, LCC filed an opposition and “counter-petition to vacate the arbitration awards.” (Doc. 7.) Ibarra replied. (Doc. 8.) The Court finds this matter appropriate for decision without oral argument, and the hearing set for December 6, 2019, at 10:30 a.m. is VACATED. Fed.R.Civ.P. 78(b); C.D. Cal. R. 7-15. For the following reasons, the Court GRANTS the Petition for Confirmation of Arbitration Award and CONFIRMS the Arbitration Award. Additionally, the Court AWARDS Ibarra $3658.20 in attorneys' fees.

         I. BACKGROUND

         On June 15, 2006, Ibarra filled out a “Full Sail Signature Student Loan Application and Promissory Note” with Sallie Mae Education Trust for the amount of $12, 000. (Petition ¶ 10; Loan Agreement, Petition Ex. 1, Doc. 1-1.) Under the Loan Agreement, Sallie Mae assigned certain rights to Navient. (See Arbitration Award at 1, Lueck Decl. Ex. E., Doc. 7-1.) The Loan Agreement incorporates an arbitration agreement which states that “either party may elect to arbitrate - and require the other party to arbitrate - any Claim.” (Loan Agreement at 6, § Q.) It further provides, in pertinent part:

The arbitrator's award will be final and binding except for: (A) any appeal right under the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq. (the “FAA”), and (B) Claims involving more than $50, 000. For Claims involving more than $50, 000, any party may appeal the award to a three-arbitrator panel appointed by the Administrator, which will reconsider de novo any aspect of the initial award that is appealed. The panel's decision will be final and binding, except for any appeal right under the FAA. Except as provided above under the caption “Location and Costs, ” the appealing party will pay the Administrator's and arbitrator's costs of the appeal.

(Id. at 6, § Q(7).)

         On February 1, 2017, Ibarra filed an arbitration demand with the American Arbitration Association (“AAA”) seeking damages under the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227, et. seq. and California's Rosenthal Fair Debt Collection Practices Act, California Civil Code § 1788.11(d), (e). (Petition ¶ 12.) His claims arose “from 154 alleged telephone calls^[1] from [Navient] to Ibarra that were made between January 11, 2016, and September 14, 2016.” (Id.) On March 15, 2017, Navient filed its answer and asserted a counterclaim for breach of contract to recover $19, 688.67 from Ibarra. (Id. ¶ 13.) On November 21, 2017, the parties attended an evidentiary hearing in front of arbitrator Peter K. Rundle. (Id. ¶ 15; Opp. at 3.) On February 26, 2018, Rundle handed down an arbitration award in favor of Ibarra, finding that Navient made 226 phone calls to Ibarra that constituted “knowing and willful violations of the TCPA.” (Arbitration Award ¶ 55.) Rundle awarded Ibarra $228, 513.52, equivalent to $249, 125 in damages and fees under the TCPA and Rosenthal Act less Ibarra's student loan liability of $20, 611.48. (Id. ¶ 61.)

         On March 28, 2018, Navient appealed the award under the above-quoted language of the arbitration agreement. (Petition ¶ 17; Opp. at 3.) In a June 19, 2019 Interim Award and August 23, 2019 Final Award, the three-arbitrator appellate panel upheld Rundle's ruling, modifying only the amount of reasonable attorney's fees granted pursuant to the Rosenthal Act and applying interest at a rate of “5% per annum.” (Petition ¶¶ 20-24; Opp. at 3-4; Interim Award, Petition Ex. 2, Doc. 1-2; Final Award, Petition Ex. 3, Doc. 1-3.) In conducting the appeal, the panel construed the “de novo” language in the arbitration agreement as follows:

The Tribunal construes the arbitration agreement to contemplate an appellate proceeding rather than a trial de novo. It therefore declines to allow a re-hearing of all the testimonial evidence, even if limited to the issues raised in the Notice of Appeal. To the extent that factual determinations are essential to a decision on those issues, the Tribunal will either subject to more searching review the factual findings made by the arbitrator below, or make those determinations anew based on the documentary record.

(Order on Appeal Procedure ¶ 2, Lueck Decl. Ex. K., Doc. 7-1.)

         II. LEGAL STANDARD

         Under the Federal Arbitration Act, when a party to an arbitration applies for confirmation of the arbitration award, the “court must grant such an order unless the award is vacated, modified, or corrected as prescribed in sections 10 and 11 of [the Arbitration Act].” 9 U.S.C. § 9; Lagstein v. Certain Underwriters at Lloyd's, London, 607 F.3d 634, 640 (9th Cir. 2010). The party seeking to vacate an award bears the burden of establishing the grounds for vacatur. U.S. Life Ins. v. Super. Nat'l Ins. Co., 591 F.3d 1167, 1173 (9th Cir. 2010). And this burden is a heavy one. A court may vacate an award only where the award was procured by corruption, fraud, or undue means; the arbitrator was partial or corrupt; the arbitrator's misconduct prejudiced the rights of a party; or the arbitrator exceeds his or her powers. 9 U.S.C. § 10; Schoenduve Corp. v. Lucent Techs., Inc., 442 F.3d 727, 731-32 (9th Cir. 2006); Kyocera Corp. v. Prudential-Bache Trade Servs., Inc., 341 F.3d 987, 997 (9th Cir. 2003). “Under the statute, confirmation is required even in the face of erroneous findings of fact or misinterpretations of law.” Kyocera, 341 F.3d at 997.

         III. ...