The Supreme Court of Texas has granted a group of payday loan customers’ request to review a putative class action case after the Fourth Court of Appeals in San Antonio ordered the customers to individually arbitrate their claims. In Henry v. Cash Biz, LP, No. 16-0854, several customers filed a would-be collective action lawsuit against a payday lender, Cash Biz. According to the customers’ complaint, Cash Biz filed various criminal complaints against its defaulting customers in violation of Texas law.
In response to the lawsuit, Cash Biz filed a motion to compel the customers’ claims to individual arbitration based on a credit service contract that each customer signed when securing a short-term loan. Although a Bexar County trial court declined to compel the dispute to arbitration, the Fourth District Court of Appeals reversed the lower court’s order. Additional information about this case is available in a prior Disputing blog post.
Issue 1: Majority opinion failed to apply abuse of discretion standard to trial court’s factual determination and failed to consider most of the evidence presented, without objection.
Issue 2: Majority opinion failed to apply FAA or federal law as required.
Issue 3: Petition for Review is necessary to correct split of authority.
On Friday, the Supreme Court of Texas granted the customers’ Petition for Review. Oral argument has not yet been scheduled by the court. Please stay tuned to Disputing for more on this case in the future!