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Olstad v. Chase Auto Finance Corp.

United States District Court, W.D. Wisconsin

January 22, 2018

TERESA OLSTAD and RONALD OLSTAD, Plaintiffs,
v.
CHASE AUTO FINANCE CORPORATION, TRI STATE RECOVERY, INC., and PRIMERITUS FINANCIAL SERVICES, INCORPORATED, Defendants.

          OPINION AND ORDER

          WILLIAM M. CONLEY District Judge

         Plaintiffs Teresa and Ronald Olstad assert claims under the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692, and Wisconsin state law claims based on defendants Chase Auto Finance Corporation, Tri State Recovery, Inc., and Primeritus Financial Services Incorporated's alleged illegal repossession of the Olstads' vehicle. Before the court is defendants' motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(3) or to stay this action and compel arbitration. (Dkt. #25.) For the reasons that follow, the court will grant the motion, require plaintiffs to arbitrate their claims, and dismiss this complaint without prejudice to any party filing a new lawsuit to seek confirmation of or challenge the arbitrators' decision.

         ALLEGATIONS OF FACT[1]

         A. Terms of Car Loan

          On or about April 23, 2014, the Olstads purchased a 2004 Ford Explorer. The Olstads financed the purchase in the amount of $9, 147.95 with defendant Chase Auto. In support of its motion, defendants provide the Retail Installment Contract between Chase and the Olstads that is referenced in the complaint (the “Contract”). (Kirsling Decl., Ex. A (dkt. #26).)[2]

         Material to the present motion, that contract contains the following Arbitration Clause in pertinent part:

         AGREEMENT TO ARBITRATE DISPUTES

The following Arbitration Agreement can significantly affect your rights in any dispute with us. Please read it carefully before signing this Contract:
1. IF EITHER OF U.S. CHOOSES, ANY CLAIM OR DISPUTE BETWEEN U.S. (AS DEFINED BELOW) WILL BE DECIDED BY ARBITRATION AND NOT IN COURT OR BY A JURY TRIAL. . . .
Any claim or dispute, whether in contract, tort, statute or otherwise (including the interpretation and scope of this clause and the arbitrability of the claim or dispute), between you and us or our employees, agents, successors or assigns, which arise out of or relate to your credit application, this Contract or any resulting transaction or relationship (including any such relationship with third parties who do not sign this Contract) shall, at your or our election, be resolved by neutral, binding arbitration and not be a court action.

(Id. at p.3.)

         B. Repossession of Car

         On or about June 2014 (two months after the vehicle purchase), the Olstads fell behind on their payments to Chase Auto. Despite payment issues, Chase Auto eventually agreed in March 2016 to accept $6, 000 to satisfy the remainder of the loan. By May 2, the Olstads had sent a check in that amount to Chase Auto, which it acknowledged receiving as final settlement payment on May 5. “At the time the payment was accepted, ” plaintiffs allege the contract between the Olstads and Chase Auto was “completed.” (Am. Compl. (dkt. #24) ¶ 32.) Moreover, on May 19, the Olstads received a letter from Chase Auto stating that the lien for the vehicle had been released electronically, and that the title would be sent to the Olstads from the Wisconsin Department of Transportation. Instead, Chase Auto apparently proceeded to retain the services of defendant Primeritus, who, in turn, retained the services of Tri State in order to repossess the Olstads' vehicle.

         On May 26, 2016, Tri State repossessed plaintiffs' vehicle, although the vehicle was returned three days later. Plaintiffs allege that both Tri State and Primeritus were acting as Chase Auto's agents in repossessing the vehicle. (Am. Compl. (dkt. #24) ¶¶ 22-25.) Plaintiffs allege a variety of injuries as a result of the repossession.

         C. Claims Asserted

         In their first amended complaint, plaintiffs allege claims for: (1) violation of the FDCPA, 15 U.S.C. § 1692f(6), against defendants Tri State and Primeritus for illegally taking the vehicle; (2) violations of the Wisconsin Consumer Act, Wis.Stat. § 245.206, against all three defendants for committing a breach of the peace in wrongfully repossessing the car; (3) violations of the Wisconsin Consumer Act, Wis.Stat. § 427.104, against all three defendants ...


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