By: Jeffrey Backman, Esq., Roy Taub, Esq. and Natalie Benayoun, Esq.
Greenspoon Marder and its client, HealthMarkets Insurance Agency, Inc. (“HealthMarkets”) secured a significant victory yesterday, obtaining an order compelling arbitration of the plaintiff’s individual claim under the Telephone Consumer Protection Act (“TCPA”) and dismissing the class claims. What had been a putative class action filed in federal court is now an individual case that must proceed to arbitration, significantly reducing any potential exposure.
In Daeshuan Thomas v. Health Market Advisors, Inc., Case No. 5:24-cv-01448, the Court found that a valid arbitration agreement existed when the Plaintiff visited a website unaffiliated with HealthMarkets to obtain health insurance quotes from identified marketing partners. After entering his personal information, the Plaintiff was presented a “Compare Rates” button to make his submission. Directly below this button, Plaintiff was advised that “[b]y clicking the button above” he “agree[s] to the Privacy Policy and Terms of Service.” The “Terms of Service” appeared as a blue hyperlink. The first page of these Terms of Service explicitly stated in bold, all caps text that it contained an arbitration agreement and class action waiver applicable to third parties, including marketing partners like HealthMarkets.
Rejecting all of the Plaintiff’s arguments, and relying upon the evidence submitted by HealthMarkets about the website at issue, the Court concluded that HealthMarkets had established that Plaintiff “(1) had clear notice of the Terms of [Service]; (2) was admonished that, by clicking the ‘Compare Rates’ button, he was agreeing to be bound by the Terms of [Service]; and (3) Plaintiff clicked the button thereby manifesting his assent to the Terms of [Service].” The Court also ruled that HealthMarkets was a third-party beneficiary to the arbitration agreement, resulting in a valid and enforceable arbitration agreement.
The Court also ruled that because the Terms of Service contained a class action waiver, the putative class claims needed to be dismissed, and stayed the lawsuit pending the outcome of the arbitration. This decision underscores the need to have a well-supported and well-argued motion to compel arbitration, because it could significantly alter the course of a lawsuit.