Second Circuit Holds Class Action Claims For Violation Of TCPA Not Arbitrable

In Arnaud v. Doctor’s Associates Inc., d/b/a Subway, the Second Circuit affirmed a lower court’s denial of a motion to compel arbitration of claims of violation of the Telephone Consumer Protection Act. Plaintiff filed a putative class action predicated upon alleged unsolicited text messages he received from the Subway franchise following his attempt to pursue a free sandwich offer by entering his phone number on a promotional page of the Subway website.

As the Second Circuit explained, “[a]ccording to Subway, such an action constituted assent to the terms and conditions contained on a separate webpage that was accessible via a hyperlink on the promotional page—terms and conditions that included an agreement to arbitrate. Nevertheless, the District Court denied Subway’s Motion, finding that no arbitration agreement existed between the parties since the terms and conditions were not reasonably clear and conspicuous on the promotional page itself. As a result, Arnaud was not on notice of the arbitration provision.”

The Second Circuit affirmed, noting that “[a] reasonable user would not find the terms and
conditions link contained on the page to be conspicuous, since the link was at the bottom of the page, in relatively small font, and was introduced by no language other than the shorthand “T & Cs.” A reasonable user would therefore not recognize that by clicking “I’M IN” he agreed to be bound by those terms and conditions.”

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