## Facts

- Daniel Norcia bought a Samsung Galaxy S4 at a Verizon store in San Francisco in May 2013.
- At purchase, a Verizon employee gave Norcia a receipt titled “Customer Agreement,” which Norcia signed; it stated he agreed to Verizon’s customer agreement and understood disputes would be settled by arbitration instead of jury trials.
- The Verizon customer agreement did not mention Samsung or any non-Verizon entity.
- After the sale, the employee opened the phone box, transferred Norcia’s contacts, and gave him the phone and accessories; Norcia left the box and a “Product Safety & Warranty Information” brochure at the store.
- The Samsung brochure contained a mandatory arbitration provision for “all disputes arising with Samsung” related to the warranty or the product’s sale/condition/performance, and provided a 30-day opt-out procedure.
- Norcia did not opt out.
- About nine months later, Norcia filed a putative class action alleging Samsung misrepresented the phone’s storage capacity and performance; he asserted misrepresentation claims and did not plead warranty claims.
- Samsung moved to compel arbitration based on (1) the in-box brochure and (2) the Verizon customer agreement (as a third-party beneficiary theory); the district court denied the motion, and Samsung appealed.

## Issues

1. Whether the arbitration clause in Samsung’s in-box “Product Safety & Warranty Information” brochure formed a binding arbitration agreement under California contract law absent Norcia’s signature or other manifestation of assent.
2. Whether Samsung, as a nonsignatory, could compel arbitration under Verizon’s customer agreement on a third-party beneficiary (or similar) theory.

## Decision

- The Ninth Circuit affirmed the denial of Samsung’s motion to compel arbitration.
- The court held no contract to arbitrate arose from the in-box brochure because Norcia did not assent and Samsung did not establish a recognized exception under California law that would treat silence or inaction as acceptance.
- The court held Samsung could not enforce Verizon’s customer agreement arbitration provision because Samsung was neither a signatory nor an intended third-party beneficiary.

## Legal Principles

- California contract law governs whether an arbitration agreement was formed; mutual assent is required for contract formation.
- An offeree’s silence or inaction generally does not constitute acceptance under California law absent a recognized exception.
- Including an arbitration clause in product packaging, coupled with a consumer’s failure to opt out, does not by itself establish assent to arbitrate when the consumer did not receive clear contractual notice and did not manifest acceptance.
- A nonsignatory may enforce a contract’s arbitration clause only if contract law supplies a valid basis (such as intended third-party beneficiary status); incidental benefit is insufficient.
- A carrier’s customer agreement that does not reference the manufacturer does not, without more, show intent to confer enforceable arbitration rights on the manufacturer.

## Conclusion

The Ninth Circuit held that Norcia was not bound to arbitrate because Samsung failed to show he agreed to the brochure’s arbitration clause, and Samsung could not compel arbitration under Verizon’s customer agreement as a nonsignatory lacking third-party beneficiary status.


Norcia v. Samsung Telecomms. Am., LLC, 845 F.3d 1279 (9th Cir. 2017)