Third party beneficiary can compel arbitration

You learned this in your first year Contracts course. Even though you were not one of the original parties to a contract, you can enforce that contract if you were a "third party beneficiary." So, if the contract has an arbitration clause, you can enforce that. And: The 9th Circuit gets it. Geier v. m-Qube (9th Cir 05/26/2016). m-Qube, Inc. is a "connection aggregator" (one that markets mobile games and other subscription-based content to the public) and also a "billing aggregator" (one who serves as a financial intermediary between customers and content providers).

Richard Geier filed a class action complaint alleging that m-Qube and other defendants have engaged in a scheme "that causes Washington consumers to become unknowingly and unwittingly subscribed to premium text message services." m-Qube claims that Geier's wife subscribed to a cell phone game provided by Pow! Mobile and that she accepted Pow! Mobile's terms and conditions, which contained an arbitration agreement covering "any controversy ... arising out of or relating to a service agreement between" Pow! Mobile and its subscriber. Geier says his wife did not subscribe and did not assent to the terms and conditions.

The defendants moved to compel arbitration. The district court said "No" on the ground that the defendants were not third party beneficiaries entitled to enforce the arbitration clause.

The 9th Circuit held that the signatory to the terms and conditions agrees to waive all claims against Pow! Mobile's suppliers. Therefore, Pow! Mobile's suppliers are intended third-party beneficiaries of the Terms. Thus, if defendants are Pow! Mobile's suppliers, they may enforce the arbitration clause.

And, after all of that we still don't know whether Geier's wife assented to the terms and conditions or whether m-Qube is a Pow! Mobile's supplier. So the case goes back to the district court to figure that out.