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Riley v. BMO Harris Bank, N.A.

United States District Court, D. Columbia.

July 22, 2015

BMO HARRIS BANK, N.A., et al, Defendants

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[Copyrighted Material Omitted]

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For JOHNETTA RILEY, Plaintiff: Jeffrey M. Ostrow, PRO HAC VICE, PRO HAC VICE, Fort Lauderdale, FL; John Austin Moore, PRO HAC VICE, STUEVE SIEGEL HANSON LLP, KANSAS CITY, MO; Hassan A. Zavareei, TYCKO & ZAVAREEI LLP, Washington, DC.

For BMO HARRIS BANK, N.A., Defendant: Kevin Scott Ranlett, LEAD ATTORNEY, MAYER BROWN LLP, Washington, DC; Debra Lee Bogo-Ernst, Lucia Nale, MAYER BROWN LLP, PRO HAC VICE, Chicago, IL.

For FIRST PREMIER BANK, Defendant: John C. Ekman, LEAD ATTORNEY, Bryan R. Freeman, PRO HAC VICE, James P. McCarthy, LINDQUIST & VENNUM, P.L.L.P., Minneapolis, MN; Thomas M. Hefferon, LEAD ATTORNEY, William Kyle Tayman, GOODWIN PROCTER LLP, Washington, DC.

For MISSOURI BANK AND TRUST, Defendant: Kristin M. Robinson, LEAD ATTORNEY, BRYAN CAVE LLP, Washington, DC; Robert M. Thompson, LEAD ATTORNEY, PRO HAC VICE, Ashley N. Gillard, PRO HAC VICE, BRYAN CAVE LLP, Kansas City, MO.

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COLLEEN KOLLAR-KOTELLY, United States District Judge.

Plaintiff, Johnetta Riley, filed suit against Missouri Bank and Trust (" MBT" ), BMO Harris Bank, N.A., and First Premier Bank seeking to recover damages and declaratory and injunctive relief on behalf of herself and members of the class of individuals who have been injured by Defendants' alleged " participation in a scheme to access and utilize the Automated Clearing House (" ACH" ) network to collect unlawful debts in violation of 18 U.S.C. § 1962 and the law of numerous states, including the District of Columbia." Compl. ¶ 1. Defendants each filed a Motion to Compel Arbitration, which the Court granted. See Mem. Op. (July 29, 2014), ECF No. [72]. Presently before the Court is Plaintiff's Motion to Reopen Case Against Defendant Missouri Bank and Trust on the basis that the arbitrator named in the loan agreement's arbitration provision is unavailable. Upon consideration of the pleadings,[1] the relevant legal authorities, and the record as a whole, the Court finds that Plaintiff's Motion does not meet the requirements of Federal Rule of Civil Procedure 60(b). Accordingly, Plaintiff's Motion is DENIED.


The genesis of this case is four online payday loans that Plaintiff applied for and received between September 27, 2012, and May 24, 2013. Compl. ¶ ¶ 77, 81, 86, 90. Plaintiff alleges that her loans fall within the category of payday loans that are illegal in the District of Columbia. See id. ¶ 5. On October 28, 2013, Plaintiff filed suit against the banks that executed the ACH transactions on behalf of the payday lenders. Plaintiff alleges that the banks " enforce[ed] debts they [knew] to be unlawful" by originating " ACH entries that represent payday loan credits and debits to and from consumer checking accounts." Id. ¶ 11. The loan agreement that Plaintiff signed with the lender who used MBT to conduct the ACH transactions contained an arbitration provision that stated:

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ARBITRATION OF ALL DISPUTES: You and we agree that any and all claims, disputes or controversies between you and us, any claim by either of us against the other (or the employees, officers, directors, agents, servicers or assigns of the other) and any claim arising or relating to your application for this micro-business loan (" Loan" ), regarding this Loan or any other Loan you previously or may later obtain from us, this Note, this agreement to arbitrate all disputes, your agreement not to bring, join or participate in class actions, regarding collection of the Loan, alleging fraud or misrepresentation, whether under common law or pursuant to federal, state or local statute, regulation or ordinance, including disputes regarding the matters subject to arbitration, or otherwise, shall be resolved by binding individual (and not joint) arbitration by and under the Code of Procedure of the National Arbitration Forum (" NAF" ) in effect at the time the claim is filed. No class arbitration. All disputes including any Representative Claims against us and/or related third parties shall be resolved by binding arbitration only on an individual basis with you. . . .

Pl.'s Mot. at 2-3 (emphasis added).

Defendants filed a Motion to Compel Arbitration pursuant to the arbitration provision in the loan agreements. See, e.g., Def. MBT's Mot. to Compel Arbitration, ECF No. [26]. On July 29, 2014, the Court found that Defendants could enforce the arbitration provision and, accordingly, granted Defendants' motions and dismissed the case in its entirety since " all of the plaintiff's claims must be submitted to arbitration." See Mem. Op. (July 29, 2014), at 15.

Nearly three months later, on October 27, 2014, Plaintiff's counsel sent a letter to the National Arbitration Forum (" NAF" ) attempting to initiate arbitration with Defendant MBT in accordance with the NAF Code of Procedure and the terms of the arbitration agreement. Pl.'s Mot., at 3. On November 5, 2014, Plaintiff's counsel received a reply from NAF explaining that NAF no longer accepts arbitration claims involving consumers, pursuant to a Consent Judgment entered in Hennepin County District Court in July 2009 between the Minnesota Attorney General and NAF. Id. at 3-4.

After another approximately three months, Plaintiff filed a Motion to Reopen Case Against Defendant MBT on January 22, 2015. Plaintiff argues that because NAF is unavailable and because its identity as arbitrator was integral to the loan agreement, arbitration is improper and the case against MBT should be reopened for the Court to adjudicate. See id. at 4, 12. Defendant filed an Opposition arguing that the Court does not have jurisdiction over Plaintiff's untimely motion and, in the alternative, that the Court should appoint a substitute arbitrator pursuant to Section 5 of the FAA. See Def.'s Opp'n, at 1-2. Plaintiff subsequently filed a Reply. On June 15, 2015, the Court ordered the parties to update the Court regarding any changes in, or additions to, the legal authority governing the issues in this case. See Minute Order (June 15, 2015). Two days later, the Court amended its June 15, 2015, Minute Order and instructed Defendant to address Plaintiff's argument that the Court has jurisdiction over Plaintiff's Motion pursuant to ancillary jurisdiction since ...

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