CompuCredit Corp. v. Greenwood
565 U.S. ___ (2012)

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Justia Opinion Summary
Although respondents' credit card agreement required their claims to be resolved by binding arbitration, they filed a lawsuit against petitioner and a division of petitioner bank, alleging, inter alia, violations of the Credit Repair Organizations Act (CROA), 15 U.S.C. 1679 et seq. At issue was whether the CROA precluded enforcement of an arbitration agreement in a lawsuit alleging violations of the Act. The Court held that because the CROA was silent on whether claims under the Act could proceed in an arbitrable forum, the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq., required the arbitration agreement to be enforced according to its terms.

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321 .

SUPREME COURT OF THE UNITED STATES

Syllabus

COMPUCREDIT CORP. et al. v. GREENWOOD et al.

certiorari to the united states court of appeals for the ninth circuit

No. 10–948. Argued October 11, 2011—Decided January 10, 2012

Although respondents’ credit card agreement required their claims to be resolved by binding arbitration, they filed a lawsuit against petitioner CompuCredit Corporation and a division of petitioner bank, alleging, inter alia, violations of the Credit Repair Organizations Act (CROA). The Federal District Court denied the defendants’ motion to compel arbitration, concluding that Congress intended CROA claims to be nonarbitrable. The Ninth Circuit affirmed.

Held: Because the CROA is silent on whether claims under the Act can proceed in an arbitrable forum, the Federal Arbitration Act (FAA) requires the arbitration agreement to be enforced according to its terms. Pp. 2–10.

     (a) Section 2 of the FAA establishes “a liberal federal policy favoring arbitration.” Moses H. Cone Memorial Hospital v. Mercury Constr. Corp., 460 U. S. 1 . It requires that courts enforce arbitration agreements according to their terms. See Dean Witter Reynolds Inc. v. Byrd, 470 U. S. 213 . That is the case even when federal statutory claims are at issue, unless the FAA’s mandate has been “overridden by a contrary congressional command.” Shearson/American Express Inc. v. McMahon, 482 U. S. 220 . Pp. 2–3.

     (b) The CROA provides no such command. Respondents contend that the CROA’s disclosure provision—which requires credit repair organizations to provide consumers with a statement that includes the sentence “ ‘You have a right to sue a credit repair organization that violates the [Act],’ ” 15 U. S. C. §1679c(a)—gives consumers the right to bring an action in a court of law; and that, because the CROA prohibits the waiver of “any right of the consumer under this subchapter,” §1679f(a), the arbitration agreement’s waiver of the “right” to bring a court action cannot be enforced. Respondents’ premise is flawed. The disclosure provision creates only a right for consumers to receive a specific statement describing the consumer protections that the law elsewhere provides, one of which is the right to enforce a credit repair organization’s “liab[ility]” for “fail[ure] to comply with [the Act].” §1679g(a). That provision does not override the FAA’s mandate. Its mere contemplation of judicial enforcement does not demonstrate that the Act provides consumers with a “right” to initial judicial enforcement. Pp. 3–8.

     (c) At the time of the CROA’s enactment in 1996, arbitration clauses such as the one at issue were no rarity in consumer contracts generally, or in financial services contracts in particular. Had Congress meant to prohibit these very common provisions in the CROA, it would have done so in a manner less obtuse than what respondents suggest. Pp. 8–9.

615 F. 3d 1204, reversed and remanded.

     Scalia, J., delivered the opinion of the Court, in which Roberts, C. J., and Kennedy, Thomas, Breyer, and Alito, JJ., joined. Sotomayor, J., filed an opinion concurring in the judgment, in which Kagan, J., joined. Ginsburg, J., filed a dissenting opinion.

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