consumer - state UDAP claims - federal court - removal

Byrd v. Car and SUV Outlet, et al. - ED Pa. - December 29, 2008

http://www.paed.uscourts.gov/documents/opinions/08D1533P.pdf

Plaintiff sued defendant, from which he bought a used car, for various alleged state-law causes of actions, including one under the Pennsylvania Unfair Trade Practices and Consumer Protection Law, which claim alleged several distinct violations, including assertions that Defendants violated the UTPCPLby breaching two federal statutes, the Truth in Lending Act and the Equal Credit Opportunity Act. Defendants sought to remove the case to federal court.

The court refused the motion to remove, holding that it did not have jurisdiction, since plaintiff had sought relief only under state law, not federal law, which were "merely two theories on which Plaintiff plans to proceed to establish a state law UTPCPL violation."

The court also held that it could still have jurisdiction if “the vindication of [Plaintiff’s] right[s] under state law necessarily turned on some construction of federal law” but held that “the mere presence of a federal issue in a state cause of action does not automatically confer federal-question jurisdiction. The federal issue must be “an essential one in the forefront of the case and not collateral, peripheral, or remote”

The federal issues in this case were held to be "not essential to establishing Plaintiff’s right to relief....The TILA and ECOA violations are merely two theories, in addition to the various theories based on state law, that Plaintiff has asserted to establish his right to relief under the UTPCPL. This is insufficient, however, to establish federal jurisdiction."

UC - willful misconduct - employer disciplinary policy - lack of Board findings

Jones v. UCBR - Cmwlth. Court - December 31, 2008 - unpublished memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/1097CD08_12-31-08.pdf

Claimant was terminated for several alleged incidents of no-call/no-show.

inconsistent Board findings - The court found that "[b]ecause the Board's findings are inconsistent with the evidence, this matter must be remanded for clarification...and a new decision."

no finding on employer compliance with its own disciplinary policy - Claimant argued that the employer did not comply with its own disciplinary policy and that therefore "she should be allowed to return to work for Employer to comply with the policy." The court said that "[w]here an employer promulgates a specific disciplinary system, a discharge under that system may not be deemed to be for willful misconduct if the employer fails to follow the specified process. PMA Reinsurance Corp. v. UCBR, 558 A.2d 623 (Pa. Cmwlth. 1989).

The Board made no findings on whether Employer followed its policy by giving warnings to Claimant after the alleged occurrences of her no calls/no shows, and the Board did not mention the issue in its decision. This issue therefore must be addressed upon remand of this matter. Accordingly, the Board's order is vacated and this matter is remanded to the Board for a clarification of its inconsistent findings of fact and for additional fact finding, if necessary, as to whether Employer complied with its written policy requiring that it provide employees with verbal and written warnings in the case of no call/no show occurrences."

mortgage foreclosure - abuse of process - elements/pleading

Birchall v. Countrywide Home Loans - ED Pa. - December 23, 2008

http://www.paed.uscourts.gov/documents/opinions/08D1517P.pdf

Claim for abuse of process dismissed for failure to allege sufficient facts. The bare allegation was that there was an abuse of process.

"To establish a claim for abuse of process, a plaintiff must show that the defendant (1) used a legal process against the plaintiff, (2) primarily to accomplish a purpose for which the process was not designed, (3) resulting in harm to the plaintiff. Werner v. Plater-Zyberk, 799 A.2d 776, 785 (Pa. Super. 2002)."

pre-emption - cigarette warnings - FTC and state consumer protection laws

Altria Group v. Good - US Supreme Court - December 15, 2008

http://www.supremecourtus.gov/opinions/08pdf/07-562.pdf

From the court's syllabus....

Respondents, smokers of petitioners’ "light" cigarettes, filed suit, alleging that petitioners violated the Maine Unfair Trade Practices Act(MUTPA) by fraudulently advertising that their "light" cigarettes delivered less tar and nicotine than regular brands. The District Court granted summary judgment for petitioners, finding the state-lawclaim pre-empted by the Federal Cigarette Labeling and Advertising Act (Labeling Act). The First Circuit reversed, holding that the Labeling Act neither expressly nor impliedly pre-empts respondents’ fraud claim.

Held: Neither the Labeling Act’s pre-emption provision nor the Federal Trade Commission’s actions in this field pre-empt respondents’ statelaw fraud claim. Pp. 5–20.

(a) Congress may indicate pre-emptive intent through a statute’s express language or through its structure and purpose. When the text of an expresspre-emption clause is susceptible of more than one plausible reading,courts ordinarily "accept the reading that disfavors pre-emption." The LabelingAct’s stated purposes are to inform the public of the health risks ofsmoking while protecting commerce and the economy from the ill effects of nonuniform requirements to the extent consistent with the first goal. Although fidelity to these purposes does not demand thepre-emption of state fraud rules, the principal question here is whether that result is nevertheless required by 15 U. S. C. §1334(b), which provides that "[n]o requirement or prohibition based on smoking and health shall be imposed under State law with respect to theadvertising or promotion of any cigarettes the packages of which are labeled in conformity with the provisions of this chapter." Pp. 5–9.

(b) Respondents’ claim is not expressly pre-empted by §1334(b). As determined in several Supreme Court cases, the phrase "based onsmoking and health" modifies the state-law rule at issue rather than a particular application of that rule. The plurality in one case concluded that "the phrase ‘based on smoking and health’ fairly but narrowly construed" did not pre-empt the plaintiff’s commonlaw claim that cigarette manufacturers had fraudulently misrepresented and concealed a material fact, because the claim alleged a violation of a duty not to deceive—a duty that is not "based on" smokingand health. Respondents here also allege a violation of the duty not to deceive as codified in the MUTPA, which, like the common-law duty in Cipollone, has nothing to do with smoking and health. Respondents’ claim is not analogous to the "warning neutralization" claim found to be pre-empted in Cipollone. Reilly is consistent with Cipollone’s analysis. This Court disagrees with petitioners’ alternative argument that the express pre-emption framework of Cipollone and Reilly should be rejected.

(c) Various Federal Trade Commission decisions with respect to statements of tar and nicotine content do not impliedly pre-empt state deceptive practices rules like the MUTPA. Pp. 17–20. 501 F. 3d 29, affirmed and remanded.

STEVENS, J., delivered the opinion of the Court, in which KENNEDY, SOUTER, GINSBURG, and BREYER, JJ., joined. THOMAS, J., filed a dissenting opinion, in which ROBERTS, C. J., and SCALIA and ALITO, JJ., joined.

PFA - abuse - fear of imminent serious bodily injury; indecent assault

Thompson v. Thompson - Superior Court - December 16, 2008

http://origin-www.courts.state.pa.us/OpPosting/Superior/out/s56023_08.pdf

Actual physical harm is not a prerequisite for the entry of a PFA order; the victim need only be in reasonable fear of imminent serious bodily injury. Fonner, 731 A.2d at 163. Mother establish that by evidence that

- Father forcibly grabbed Mother's breasts and crotch and yelled obscenities at their sons when they tried to intervene on her behalf.
- On one occasion Father came home drunk early in the morning, got into a fight with the older son, and then tried to hit him with his car.
- Father drinks and abuses cocaine, that she is afraid of Father, and that she fears for her children when they are in his custody.
- Father sideswiped eldest son with his car as son walked to school, because he was afraid that father was high on cocaine
- Father pushed and shoved youngest son and regularly threatened to hurt him

The court considered the sufficiency of the evidence in light of McCance v. McCance, 908 A.2d 905 (Pa. Super. 2006), where the Superior Court concluded that the evidence was sufficient to establish reasonable fear of imminent serious bodily injury where plaintiff testified that defendant stood in front of her car while she was in it and yelled obscenities and threats, that the defendant struck her car with such force that repairs were needed, and that the defendant had a drinking problem, anger issues and had been physically violent with other people in the past.

The evidence also establishes that Father has grabbed Mother in a sexual way when she arrived at his house to pick the children up, by grabbing her breasts and crotch while making lascivious comments such as, "You know you like it." This was indecent assault under 18 Pa. C.S.A. § 3126(a). "Accordingly, the evidence supports the PFA court’s determination."

UC - petition for review - preservation of issues

Patla v. UCBR - Cmwlth. Court - December 18, 2008

http://www.courts.state.pa.us/OpPosting/Cwealth/out/823CD08_12-18-08.pdf

The court granted the UCBR's motion to strike the appeal for failure of the petition for review to state appellant's objections with specificity, as required by Pa. R.A.P. 1513. The petition "merely that the determinations in the UCBR’s order were “not supported by the record,” and “that there is no legal basis for the UCBR’s denial of benefits.”

The court said that those objections did not "fairly embrace the willful misconduct issue, and failed to identify specific findings of fact that are allegedly unsupported by substantial evidence. Pearson v. UCBR, 954 A.2d 1260, 1263 (Pa. Cmwlth. 2008)."

To determine if a petition for review states a claimant’s objections with sufficient specificity, the court said that it looks to Pa. R.A.P. (Rule) 1513(d), which requires that a petition for review contain “a general statement of the objections to the order or other determination.” The general statement “will be deemed to include everysubsidiary question fairly comprised therein.” Rule 1513(d)(6).

However, more than a bare restatement of the scope of review is required, as the court held in Deal v. UCBR, 878 A.2d 131 (Pa. Cmwlth. 2005). In Deal, the court dismissed the petition for review because it stated only that the Board "was guilty of an error of law in deciding to reverse the decision of the Referee and deny benefits, and that there was a "a lack of substantial evidence to support the decision of the Board." It "did not contain any statement that fairly embraced the legal issue in the case and did not identify specific findings that were allegedly unsupported by substantial evidence; thus, the petition contained no issues for review."

"In the instant case, Claimant’s petition suffers from the same insufficiencies as the petition in Deal. Claimant’s Claimant’s Petition for Review offers no statement that this Court could deem “fairly embraces” willful misconduct, nor does it set forth what findings of fact were unsupported by the evidence. Accordingly, although developed in Claimant’s brief, his arguments regarding the issues will not be considered by this Court on appeal. See Deal."

In addition the claimant did not address any of the issues raised in the UCBR’s motion to strike the petition for review, despite the court’s direction to do so.

UC- failure to attend hearing - remand - good cause

Scott v. UCBR - Cmwlth. Court - December 18, 2008 - unreported memorandum opinion

http://www.courts.state.pa.us/OpPosting/Cwealth/out/985CD08_12-18-08.pdf

Held, that where good cause for a remand does not appear on the face of a request by a party who did not attend the initial hearing, it is error for the Board to grant a remand under 34 Pa. Code §101.24. In this case, claimant said that she did not attend because she couldn't find the location of the hearing, even though she had received proper and timely written notice.

The regulation provides: (a) If a party who did not attend a scheduled hearing subsequently gives written notice, which is received by the tribunal prior to the release of a decision, and it is determined by the tribunal that his failure to attend the hearing was for reasons which constitute “proper cause,” the case shall be reopened. Requests for reopening, whether made to the referee or Board, shall be in writing; shall give the reasons believed to constitute “proper cause” for not appearing …. (c) A request for reopening the hearing which is not received before the decision was mailed, but is received or postmarked on or before the 15th day after the decision of the referee was mailed to the parties shall constitute a request for further appeal to the Board and a reopening of the hearing, and the Board will rule upon the request. If the request for reopening is …. denied, the Board will append to the record the request, supporting material and the ruling on the request, so that it shall be subject to review in connection with any further appeal to the Commonwealth Court.

The Board has discretion regarding requests for remands to supplement a hearing record. Harrison v. UCBR, 457 A.2d 238 (Pa. Cmwlth. 1983). In reviewing a decision of the Board to deny a request for a remand, the court will reverse the Board’s decision only if the Board has abused its discretion. Department of Auditor General v. UCBR, 484 A.2d 829 (Pa. Cmwlth. 1984).

The usual purpose of a remand is to allow the submission of pertinent evidence that a party did not offer at the initial hearing because it was not available at that time. Brady v. UCBR, 539 A.2d 936 (Pa. Cmwlth. 1988). Thus, in Flores v. UCBR, 686 A.2d 66 (Pa. Cmwlth. 1996), the court held that the Board did not abuse its discretion in denying a request for a remand for the submission of evidence that had been available at the time of the original hearing. See also Fisher v. UCBR, 696 A.2d 895 (Pa. Cmwlth. 1997).

In Sanders v. UCBR, 524 A.2d 1031 (Pa. Cmwlth. 1987), the court held that the Board had abused its discretion in remanding a case for a second hearing where the employer had not offered good cause as to why it did not appear at the initial hearing. The Court held that it was not “necessary to remand a case to the Board for findings of good cause where, as here, the employer’s explanations on for its failure to appear do not--on their face--rise to the level of ‘proper cause’ as a matter of law.” Sanders, 524 A.2d at 1033 (citation omitted). See also, Ortiz v. UCBR, 481 A.2d 1383 (Pa. Cmwlth. 1984) (Board should decide case on the merits, without remand, where no proper cause for a remand.)

In this case, the reasoning in Sanders applies, despite the harsh result. If one assumes that claimant’s description of her efforts is accurate, the court held that she could have taken more reliable measures to ensure that she knew where she needed to be and how to get there. In this case, had she called the referee’s office and obtained information, she may have been able to avoid the mistake she made in her effort to appear at the hearing. Claimant did not take the necessary steps to protect her own interests. The Board did not abuse its discretion in denying claimant’s request to reopen the case and remand to the referee for additional testimony

Social Security - standard of proof

http://edocket.access.gpo.gov/2008/pdf/E8-30056.pdf

SUMMARY: We are amending our rules to clarify that we apply the preponderance of the evidence standard when we make determinations and decisions at all levels of our administrative review process.

These rules do not change our policy that the Appeals Council applies the substantial evidence standard when it reviews a decision by an administrative law judge (ALJ) to determine whether to grant a request for review.

We are also adding definitions of the terms ‘‘substantial evidence’’ and ‘‘preponderance of the evidence’’ for use in applying these rules.

DATES: These final rules are effective on January 20, 2009.

Note:
This rule change highlights the difference between standard of proof and standard of review. It is consistent with state law on the issues. “The degree of proof required to establish a case before an administrative tribunal is the same degree of proof used in most civil proceedings, i.e., a preponderance of the evidence.” Samuel J. Lansberry Inc v. PUC, 578 A.2d 600, 602 (Pa. Cmwlth. 1990). Accord, Steadman v. SEC, 450 U.S. 91 (1981) (discussing the proper standard of proof and the confusion between standard of proof and standard of review.

The proper standard of proof can be a constitutional matter and involve balancing of competing interests. See, e.g., Addington v. Texas, 441 U.S. 323 (1979); In Re Winship, 397 U.S. 357 (1970). In a Child Protective Services Law case, J.S. v. DPW, 596 A.2d 1114, 1116 n. 2 (Pa. 1991), the court suggested that the proper standard of proof in administrative hearings under that statute was “clear and convincing,” because the fundamental right to reputation under Article I, sec. 1, of the Pa. Constitution was at stake. See also, A.Y. v. DPW, 641 A.2d 1148, 1152, 1153-4 (discussing the importance of right to reputation). This is also the standard in welfare cases where fraud is being charged, 55 Pa. Code 275.31.

administrative law - commissions - powers

Deoria v. State Athletic Commn. - Cmwlth. Court - December 8, 2008

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/1266CD08_12-8-08.pdf

A commission has the status set out in the Administrative Code of 1929, 71 P.S. §§51 - 732. As a statutorily created agency of the Commonwealth, a commission has only those powers expressly conferred upon it by statute or those powers which are necessarily implied from its express powers. DeMarco v. Department of Health, 397 A.2d 61 (Pa. Cmwlth. 1979) (Administrative agencies, being creatures of the legislature, are vested only with those powers conferred by the statute or such as are necessarily implied from a grant of such powers; where authority is conferred on such an extrajudicial body, the legislative grant of power to act in any particular case must be clear.); Human Relations Commission v. St. Joe Minerals Corp., 476 Pa. 302, 382 A.2d 731 (1978) (The power and authority to be exercised by administrative commissions must be conferred by legislative language clear and unmistakable. A doubtful power does not exist.). An agency must act within the strict and exact limits as statutorily defined. Id.

real property - tax sale - redemption - timely petition

U.S. Bank Natl. Assn. v. Parker - Superior Court - December 8, 2008

http://origin-www.courts.state.pa.us/OpPosting/Superior/out/s56038_08.pdf

Upon payment of all the necessary costs and fees, the owner of any property sold under tax or municipal claim may redeem the property at anytime within nine months of acknowledgement of the sheriff’s deed. 53 Pa. C. S. § 5293(a).

It is undisputed that the sheriff’s deed was acknowledged on March 19, 2007. Thus, Appellant had until December 19, 2007, in order to file her petition to redeem. Unfortunately for Appellant, she filed her petition on December 24, 2007, i.e., five days late.

employment - public - suspension - due process

Dee v. Borough of Dunmore - 3d Cir. - December 5, 2008

http://www.ca3.uscourts.gov/opinarch/071720p.pdf

Public employee (fire fighter) had property and liberty interests in non-suspension without just cause under 42 USC 1983 and 53 P.S. § 46190. Case remanded for determination of whether there were exigent circumstances which justified suspension without prior notice and hearing.

UC- vol. quit - voluntary retirement

Degosky v. UCBR - Cmwlth. Court - December 4, 2008 - unreported memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/1129CD08_12-4-08.pdf

Subjective, unsubstantiated fear of a layoff, plus offer of voluntary retirement package did not establish good cause to quit a job. In Staub v. UCBR, 673 A.2d 434, 437 (Pa. Cmwlth. 1996), the court held that speculation pertaining to an employer’s financial condition and future layoffs, however disconcerting, does not establish the requisite necessitous and compelling cause. Instead, the relevant inquiry is whether surrounding circumstances at the time an employee voluntarily leaves indicate a likelihood that fears about his or her job security will otherwise materialize, that serious impending threats to the employee’s job will be realized and that the employee’s belief that his job is imminently threatened is well founded. Moreover, while the fact that an employer has made an offer of retirement or other incentive package is important, it is not dispositive of the issue. There must be some additional circumstances existing at the time the employee accepts the offer, e.g., a lack of suitable continuing work, either currently or at a discernible point in time, together with statements or actions of the employer showing a likelihood of imminent layoff.

Here, Claimant's fear of loss of his job was "only a subjectively perceived possibility." He was "never informed that his job was in imminent danger and his supervisors informed him only that they did not know the status of his job, and further, there was evidence that continuing work was available to him. Other than his speculation that his job was in imminent danger because some of his work had been moved to Texas, there is no evidence that would prove that his concerns would be realized.

UC - willful misconduct - rule violation - mistreatment of fellow workers

Torres-Williams v. UCBR - Cmwlth. Court - December 4, 2008 - unreported memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/910CD08_12-4-08.pdf

Employer rule required workers to treat each other with "courtesy, honor, and respect." On December 31, 2007, Employer issued a warning to Claimant for improper verbal communications to patients and co-workers. On January 9, 2008, Claimant asked a question of a co-worker. When the co-worker indicated that she did not know the answer to Claimant’s question, Claimant responded “Jesus Christ, what do you know?” Employer fired claimant for that behavior the next day. Employer produced evidence as hearing of other similar incidents as well.

Claimant alleged that she did not have any bad intent when she made the remark and that it is not considered offensive in some cultures. The court said that she did not produce any authority "for her position that the lack of offensive intent constitutes good cause in a willful misconduct case. The sole questions the Board, and this Court, can consider are: (1) whether the statement is offensive, (2) whether the employee intended to make the statement and (3) whether the statement violated a rule of the employer. See Williams v. UCBR, 926 A.2d 568 (Pa. Cmwlth.), petition for allowance of appeal denied, 596 Pa. 712, 940 A.2d 368 (2007). Again, the evidence of record supports the Board’s findings and ultimate conclusion herein."

UC - appeal - petition for review - preservation/waiver of issues

Torres-Williams v. UCBR - Cmwlth. Court - December 4, 2008 - unreported memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/910CD08_12-4-08.pdf

The court rejected the Board's attempt to quash or strike the petition for review based on claims that (1) the petition does not seek to challenge the basis of the Board’s decision, i.e., Claimant’s conduct constitutes willful misconduct, and (2) the petition for review does not seek to challenge matters over which this Court can exercise its powers of review, i.e., the Board’s factual findings, legal errors or constitutional violations.

The court said that it "has recently indicated that we may 'decline to consider issues a claimant fails to raise with sufficient specificity in his petition for review.” Pearson v. UCBR, 954 A.2d 1260, 1263 (Pa. Cmwlth. 2008). We have also dismissed a claimant’s petition for review where the claimant only asserted vague issues of error on the part of the Board or simply asserted that the Board’s decision was not supported by substantial evidence. See Deal v. UCBR, 878 A.2d 131 (Pa. Cmwlth. 2005).

A claimant must submit a statement in his or her petition for review that is more substantial than merely a recitation of our standard of review. Admittedly, the grounds for reversal as stated by Claimant in her petition for review are somewhat lacking. However, Claimant does allege in her petition that she is challenging the Board’s decision based upon “minimum grounds of evidence.” We interpret this statement as a challenge to the Board’s findings and its conclusion that Employer met its burden of establishing willful misconduct. Claimant’s argument herein is similar to the arguments raised by the claimant in Pearson, who alleged that the Board had failed to “review all the facts” and that “this case is not strong enough,” which we interpreted as a challenge to the employer’s burden of proof and which we relied upon in rejecting the application of the waiver doctrine. Pearson, 954 A.2d at 1263.12

child abuse - expungement - photos as evidence of severe pain - perpetrator criminally negligent

S.T. v. DPW - Cmwlth Court - December 4, 2008 (order directing publication of Sept. 24th opinion)

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/91CD08_12-4-08.pdf

Denial of expungment affirmed

photographic evidence showed "severe pain"
Photographic evidence held to be sufficient proof of severe pain. "A finding that a child has suffered severe pain does not need to be supported by witness testimony or medical evidence. D.N. v. DPW, 562 A.2d 433 (Pa. Cmwlth. 1989). In fact, this Court has concluded that photographs alone of a child’s injuries may support a finding that the injuries caused the child severe pain. City of Philadelphia, Office of Children, Youth and Family Services v. DPW, 767 A.2d 10 (Pa. Cmwlth. 2001).

The ALJ said the the photots "show bruises over much of the child’s body. The picture of the extensive bruising from the child’s abdomen to his groin is especially graphic. As such, the pictures depict the result of a savage beating that was far removed from any acceptable corporal punishment." From the photos one could "reasonably infer that the injuries caused severe pain."

petitioner was one of the "perpetrators" of the abuse
Petitioner/mother was held to be a perpetrator of the abuse, even thought it was her boyfriend who inflicted most of it. The " standard to be used when evaluating a perpetrator’s actions in administering corporal punishment is whether or not her actions equals that of criminal negligence. P.R. v. DPW, 569 Pa. 123, 801 A.2d 478 (2002)."

A person is criminal negligent "with respect to a material element of an offense when he should be aware of a substantial and unjustifiable risk that the material element exists or will result from his conduct. The risk must be of such a nature and degree that the actor’s failure to perceive it, considering the nature and intent of his conduct and the circumstances known to him, involves a gross deviation from the standard of care that a reasonable person would observe in the actor’s situation. 18 Pa. C.S. § 302(b)(4).

Petitioner, by her own testimony, decided to abdicate her parental responsibilities regarding discipline to her boyfriend. She then also chose not to be present in the room where she knew her son was being hit with a belt. Upon hearing her son cry, she entered his room. Once in the room, Petitioner did not suggest that she made any attempt to determine whether the punishment her son was receiving was appropriate. She did not raise any questions as to the force being used to hit the child or the location of the blows on his body. Instead, Petitioner’s only concern upon entering the room was to further punish S.P. for violating her “no crying while taking a beating” rule. After hitting S.P. herself, she chose to return the belt to her boyfriend so he could continue the punishment. She then left the room, again choosing not to monitor the situation. As such, Petitioner’s acts and omissions equal a gross deviation from the standard of care that a reasonable person would observe in the actor’s situation.

consumer - arbitration clause - bank depositor agreement

Baylis v. Wachovia Bank, ED Pa., November 25, 2008

http://www.paed.uscourts.gov/documents/opinions/08D1397P.pdf

In customer's suit against a bank for allowing a wrongful attachment of her account, the court granted the bank's motion to compel arbitration, because of a depositor agreement that the bank customer said she never received. The court found that the custody "agreed to the terms of the depositor agreement, including the arbitration of disputes, because she continued to use her accounts." The customer said that she never got the depositor agreement and therefore could not have entered into a contract with the bank. She also argued that the agreement was a contract of adhesion and thus unenforceable.

A depositor agreement was allegedly mailed to the customer in 2003. The agreement included the following: 25. Arbitration of Disputes/Waiver of Jury Trial and Participation in Class Actions. If either you or we request, any irresolvable dispute or claim concerning your account or your relationship to us will be decided by binding arbitration under the expedited procedures of the Commercial Financial Disputes Arbitration Rules of the American Arbitration Association (AAA), and Title 9 of the US Code.

proof of mailing, presumption of receipt - The court accepted the affidavit of mailing of a 3rd party company which had a contract with the bank to mail notices to depositors. The court said that the "affidavit credibly recites that the affiant's company...was retained in 2003 to mail notices to bank depositors... [and] stated he found plaintiff's name in the database used to generate the mailing. The contents of the mailing included a letter to depositors and the new Deposit Agreement." The court accepted this as creating a presumption of receipt under F.R.Civ.P 6(e).

The court rejected depositor's attempt to overcome the presumption, distinguishing Carnathan v. Ohio National Life Insurance Co., No. 06-999, 2008WL 2578919, at *5 (M.D. Pa. June 26, 2008), which held the plaintiff in that case had offered sufficient evidence to overcome the presumption of receipt when he detailed his business’s handling of incoming mail and invoices. " The court distinguished Carnathan "both by the quantum of evidence offered to rebut the presumption and by the rights at stake. In Carnathan, the court found only the plaintiff had offered sufficient evidence to preserve the issue for trial. Id. If the Carnathan court had granted summary judgment, the plaintiff would have lost a disability policy for which he had diligently paid for 13 years....In this case, Baylis has offered less evidence of non-receipt to overcome the presumption and she retains all of her rights to be made whole in arbitration. For that reason, I find Baylis received the 2003 mailing of the depositor agreement including Paragraph 25 compelling arbitration."

not a contract of adhesion - Citing 3rd Circuit law, the court said that a "contract is “not unconscionable merely because the parties to it are unequal in bargaining position.” Alexander v. Anthony Int’l, L.P., 341 F.3d 256, 265 (3d Cir. 2003). The dominant party must use its position to impose “terms that unreasonably favor one party to which the disfavored party does not truly assent.” Id. The Third Circuit held an arbitration clause is not unconscionable, even in a contract of adhesion, because “plaintiffs who sign valid arbitration agreements . . . retain the full range of . . . substantive rights.” Gay v. CreditInform, 511 F.3d 369, 391-92 (3d Cir. 2007) (holding a depositor to the terms incorporated by reference on a signature card). A consumer who objects to the terms of a contract of adhesion “certainly could have decided to forego obtaining [the bank’s] services.” Id. at 391 n.15.

Baylis’s contract with Wachovia is not unconscionable and she could have terminated her agreement with Wachovia had she objected to the arbitration clause. Because I find Baylis received the depositor agreement and entered into the contract by continuing to use her account, I conclude Baylis agreed to arbitrate any dispute with Wachovia. I will grant Wachovia’s Motion to Compel Arbitration.