{"id":1221,"date":"2024-02-19T18:02:23","date_gmt":"2024-02-19T22:02:23","guid":{"rendered":"https:\/\/blogs.duanemorris.com\/classactiondefense\/?p=1221"},"modified":"2024-02-19T18:02:23","modified_gmt":"2024-02-19T22:02:23","slug":"illinois-federal-court-orders-samsung-to-defend-806-individual-bipa-claims-in-arbitration-and-pay-311000-in-arbitration-filing-fees","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/classactiondefense\/2024\/02\/19\/illinois-federal-court-orders-samsung-to-defend-806-individual-bipa-claims-in-arbitration-and-pay-311000-in-arbitration-filing-fees\/","title":{"rendered":"Illinois Federal Court Orders Samsung To Defend 806 Individual BIPA Claims In Arbitration And Pay $311,000 In Arbitration Filing Fees"},"content":{"rendered":"

\"\"<\/a>By Eden E. Anderson, Rebecca Bjork, and Gerald L. Maatman, Jr.<\/strong><\/p>\n

Duane Morris Takeaways: <\/strong>On February 15, 2024, the Judge Harry Leinenweber of the U.S. District Court for the Northern<\/em> District of Illinois granted a motion to compel arbitration<\/a> in Hoeg et al. v. Samsung Electronics of America, Inc., Case No. 23-CV-1951 (N.D. Ill. Feb. 15, 2024), \u00a0and sent 806 individual privacy claims to arbitration and ordered Samsung to pay $311,000 to cover its share of arbitration filing fees in those matters.\u00a0 The decision highlights the potential downsides of class action waivers in arbitration agreements, as well as the importance of coupling a class action waiver with a well-crafted mass arbitration provision designed to streamline arbitration proceedings and, hopefully, limit exposure and litigation costs.\u00a0 <\/em><\/p>\n

Case Background <\/strong><\/p>\n

Samsung required customers to execute agreements to binding arbitration and those agreements waive the right to pursue class claims.\u00a0 The arbitration agreements provided that electronic acceptance, opening product packaging, product usage, or product retention amounted to acceptance of the arbitration agreement.<\/p>\n

In 2022, 806 customers, all of whom alleged they had purchased and used Samsung products, filed individual arbitration actions against Samsung alleging violations of the Illinois Biometric Privacy Act (\u201cBIPA\u201d).\u00a0 After Samsung failed to pay $311,000 in arbitration filing fees due in the matters, AAA administratively closed the cases in January 2023.\u00a0 The plaintiffs then moved to compel arbitration.<\/p>\n

The Court\u2019s Decision <\/strong><\/p>\n

The Court granted the motion to compel arbitration and, in doing so, was highly critical of Samsung\u2019s tactics in seeking to stall the prosecution of the claims.\u00a0 The Court found that the plaintiffs alleged they purchased and used Samsung products, and thereby assented to arbitration.\u00a0 While Samsung argued those allegations were conclusory and did not show the existence of agreements to arbitrate, the Court noted that Samsung\u2019s approach \u201cflips the evidentiary burden on its head\u201d because, as the party opposing arbitration, it was Samsung\u2019s burden to dispute the existence of an agreement to arbitrate.\u00a0Id.<\/em> at 9.<\/p>\n

As to its failure to pay the arbitration filing fees, the Court expressed great displeasure with Samsung, noting that its \u201crepeated failure to pay after multiple deadlines, without any showing of hardship, is a classic refusal to pay scheme in violation of Section 4\u201d of the Federal Arbitration Act.\u00a0 Id.<\/em> at 15. The Court also highlighted that Samsung\u2019s tactics had delayed plaintiffs\u2019 prosecution of their claims for two years.\u00a0 The Court further denied Samsung\u2019s request that the matters be stayed so that it could pursue an appeal and ordered Samsung to pay the outstanding arbitration fees.<\/p>\n

Implications Of The Decision <\/strong><\/p>\n

The Hoeg <\/em>decision highlights the potential downsides of class action waivers, which have spurred the plaintiffs\u2019 bar to pursue hundreds or even thousands of individual arbitrations all at once.\u00a0 The decision also underscores the importance of adding a mass arbitration provision to an arbitration agreement.\u00a0 Such a provision, if well-crafted, may serve to streamline those proceedings, facilitate resolution, and limit exposure.\u00a0 Some jurisdictions have enacted laws aimed at punishing a retailer\u2019s or employer\u2019s failure to pay arbitration fees.\u00a0 For example, in California, if arbitration fees are not timely paid, it results in a material breach of the arbitration agreement and could lead to the imposition of sanctions including \u201cthe reasonable expenses, including attorney\u2019s fees and costs, incurred by the employee or consumer as a result of the material breach.\u201d\u00a0 (Cal. Civil Code \u00a7 1281.99.)<\/p>\n","protected":false},"excerpt":{"rendered":"

By Eden E. Anderson, Rebecca Bjork, and Gerald L. Maatman, Jr. Duane Morris Takeaways: On February 15, 2024, the Judge Harry Leinenweber of the U.S. District Court for the Northern District of Illinois granted a motion to compel arbitration in Hoeg et al. v. Samsung Electronics of America, Inc., Case No. 23-CV-1951 (N.D. Ill. Feb. … <\/p>\n

Continue reading “Illinois Federal Court Orders Samsung To Defend 806 Individual BIPA Claims In Arbitration And Pay $311,000 In Arbitration Filing Fees”<\/span><\/a><\/p>\n","protected":false},"author":651,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[41],"tags":[],"ppma_author":[92,11,7],"class_list":["post-1221","post","type-post","status-publish","format-standard","hentry","category-arbitration-issues"],"authors":[{"term_id":92,"user_id":651,"is_guest":0,"slug":"eeanderson","display_name":"Eden Anderson","avatar_url":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-content\/uploads\/sites\/56\/2023\/07\/andersoneden-100x100.jpg","0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""},{"term_id":11,"user_id":579,"is_guest":0,"slug":"rsbjork","display_name":"Rebecca S. Bjork","avatar_url":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-content\/uploads\/sites\/56\/2022\/09\/bjorkrebecca-100x100.jpg","0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""},{"term_id":7,"user_id":575,"is_guest":0,"slug":"gmaatman","display_name":"Gerald L. Maatman, Jr.","avatar_url":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-content\/uploads\/sites\/56\/2022\/09\/maatmangerald-100x100.jpg","0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""}],"_links":{"self":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts\/1221","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/users\/651"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/comments?post=1221"}],"version-history":[{"count":0,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts\/1221\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/media?parent=1221"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/categories?post=1221"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/tags?post=1221"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/ppma_author?post=1221"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}