California state court grants motion to compel arbitration filed by Simmonds & Narita clients in putative class action asserting claims under the California Rees-Levering Act, California Rosenthal Fair Debt Collection Act, and California’s Unfair Competition Law.
A debt buyer acquired an auto deficiency balance and sued the debtors in state court for the unpaid amount. The debtors filed a putative class action cross-complaint against the debt buyer and the seller based on an allegedly defective notice the debtors received prior to the repossession of their vehicle. The debtors asserted class action crossclaims under the California Rees-Levering Act, California Rosenthal Fair Debt Collection Act, and California’s Unfair Competition Law.
The cross-defendants moved to compel arbitration under the arbitration agreement the debtors signed when they financed their purchase of the vehicle, which contained a class action waiver. The court granted the motion and stayed the case pending the completion of arbitration proceedings. The court rejected the debtors’ arguments that the agreement was unconscionable, including their contention that the agreement was unenforceable under McGill v. Citibank, N.A., 2 Cal.5th 945 (2017).
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