Collection Company Cannot Invoke Arbitration Agreement Between Creditor And Debtor

Verizon engaged a collection company to pursue a debt owed by a customer. The collection company allegedly sent the debtor text messages that violated the Telephone Consumer Protection Act and the Fair Debt Collection Practices Act, resulting in the debtor filing suit against the collection company. The collection company moved to compel arbitration, citing the agreement between the debtor and Verizon. The U.S. District Court in Ioane v. MRS BPO, LLC a/k/a MRS Associates of New Jersey held that the debtor’s litigation claims did not arise out of his agreement with Verizon, and thus were not arbitrable.

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