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Appellate court affirms arbitration on claims against college

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With one judge frustrated that Indiana residents and students may have been “hornswoggled” by a college’s advertisements about being accredited, the Indiana Court of Appeals has upheld an order compelling arbitration on a claim that three students were fraudulently induced to enroll because of misrepresentation about that accreditation.

The order comes in the case of Connie Brumley, et al. v. Commonwealth Business College Education Corp., No. 45A04-1002-CT-66, a case from Lake Superior Court.

Three student plaintiffs alleged they were fraudulently induced to enroll in a surgical technology program at Brown Mackie’s Merrillville location by the college’s misrepresentation of its accreditation. Each signed an enrollment agreement and supplemental arbitration form, both of which contained arbitration clauses, and they paid tuition and attended the courses. But at some point they learned of the accreditation issue, and later filed suit alleging breach of express and implied contract, intentional and negligent misrepresentation, and fraud –- on the grounds they wouldn’t be able to obtain the type of surgical jobs they were being trained for.

Brown Mackie moved to compel arbitration based on the signed documents, and the original judge on the case denied the college’s motion to compel arbitration based on the enrollment agreement stating the institution was accredited when it was not. But after the case was consolidated with a similar action and transferred to Superior Judge Gerald Svetanoff, he readdressed the issue and granted the motion to compel arbitration. Though he agreed with his colleague about the enrollment agreement not being able to mandate arbitration based on its validity, Judge Svetanoff found that the rationale didn’t extend to the separate arbitration form that none of the student plaintiffs alleged was false or fraudulent.

The plaintiffs asked for interlocutory appeal, the trial court granted that certification, and the Court of Appeals accepted the appeal and heard arguments March 2.

Even though the Federal Arbitration Act and caselaw allows for arbitration agreements to be invalidated by issues such as fraud or unconscionability, the Indiana appellate panel found that the language of this Brown Mackie arbitration agreement didn’t cross any of those lines.

“We conclude that, because plaintiffs’ action challenges the enrollment agreements in their entirety rather than the arbitration clauses in particular, the plaintiffs’ claims remain subject to arbitration,” Judge Nancy Vaidik wrote.

The appellate panel also ruled on other matters that came up in the appeal, such as Brown Mackie’s need or ability to file a cross-appeal relating to the trial judge’s rationale.

Judge Michael Barnes concurred with a separate opinion, finding the majority was correct and he agreed with the arbitration provisions per se based on precedent from the Supreme Court of the United States. However, he pointed out his concerns with what possibly happened in this case, even though the students’ allegations are still unproven at this point.

“Still, if true, it is plainly evident that Brown Mackie at best was disingenuous in its advertising, and at worst was actively dishonest in touting the surgical technology degree it offered,” he wrote. “Although Brown Mackie trumpeted being ‘accredited’ in its advertising and materials, that ‘accreditation’ allegedly was insufficient to allow graduates to take the required exam for surgical technology certification. Indiana residents likely were hornswoggled here, and I am frustrated that we are powerless to intervene. I must trust that an arbitrator will fairly consider the students’ claims. I concur fully, but grudgingly.”

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  1. It appears the police and prosecutors are allowed to change the rules halfway through the game to suit themselves. I am surprised that the congress has not yet eliminated the right to a trial in cases involving any type of forensic evidence. That would suit their foolish law and order police state views. I say we eliminate the statute of limitations for crimes committed by members of congress and other government employees. Of course they would never do that. They are all corrupt cowards!!!

  2. Poor Judge Brown probably thought that by slavishly serving the godz of the age her violations of 18th century concepts like due process and the rule of law would be overlooked. Mayhaps she was merely a Judge ahead of her time?

  3. in a lawyer discipline case Judge Brown, now removed, was presiding over a hearing about a lawyer accused of the supposedly heinous ethical violation of saying the words "Illegal immigrant." (IN re Barker) http://www.in.gov/judiciary/files/order-discipline-2013-55S00-1008-DI-429.pdf .... I wonder if when we compare the egregious violations of due process by Judge Brown, to her chiding of another lawyer for politically incorrectness, if there are any conclusions to be drawn about what kind of person, what kind of judge, what kind of apparatchik, is busy implementing the agenda of political correctness and making off-limits legit advocacy about an adverse party in a suit whose illegal alien status is relevant? I am just asking the question, the reader can make own conclsuion. Oh wait-- did I use the wrong adjective-- let me rephrase that, um undocumented alien?

  4. of course the bigger questions of whether or not the people want to pay for ANY bussing is off limits, due to the Supreme Court protecting the people from DEMOCRACY. Several decades hence from desegregation and bussing plans and we STILL need to be taking all this taxpayer money to combat mostly-imagined "discrimination" in the most obviously failed social program of the postwar period.

  5. You can put your photos anywhere you like... When someone steals it they know it doesn't belong to them. And, a man getting a divorce is automatically not a nice guy...? That's ridiculous. Since when is need of money a conflict of interest? That would mean that no one should have a job unless they are already financially solvent without a job... A photographer is also under no obligation to use a watermark (again, people know when a photo doesn't belong to them) or provide contact information. Hey, he didn't make it easy for me to pay him so I'll just take it! Well heck, might as well walk out of the grocery store with a cart full of food because the lines are too long and you don't find that convenient. "Only in Indiana." Oh, now you're passing judgement on an entire state... What state do you live in? I need to characterize everyone in your state as ignorant and opinionated. And the final bit of ignorance; assuming a photo anyone would want is lucky and then how much does your camera have to cost to make it a good photo, in your obviously relevant opinion?

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