Norcia v. Samsung Telecommunications America, LLC

Daniel Norcia (plaintiff) bought a Samsung Galaxy S4 phone at a Verizon Wireless store. Titled “Customer Agreement,” Norcia’s receipt stated that he agreed to the current Verizon Wireless customer agreement, and included an arbitration clause, but did not refer to Samsung Telecommunications America, LLC (defendant). Norcia signed the receipt, and Verizon e-mailed him a copy. After the salesperson transferred Norcia’s contacts to the S4, he left with the phone and accessories but declined to take the box with its 101-page brochure titled “Product Safety & Warranty Information.” The warranty section stated, in all capital letters, “All disputes arising with Samsung in any way from this limited warranty or the sale, condition or performance of the products shall be resolved exclusively through final and binding arbitration.” Another section explained that customers could opt out by notifying Samsung within 30 days of the purchase, and that customers who opted out would “continue to enjoy the benefits of the Limited Warranty.” Norcia did not opt out. Nine months later, Norcia brought a class action claiming that Samsung misrepresented the S4’s storage capacity and rigged the phone to operate faster during testing, without any breach of warranty claims. Samsung moved to compel arbitration. The trial court refused, reasoning that the receipt and brochure did not form a binding agreement to arbitrate nonwarranty claims. Samsung appealed.