Khowala v. Vivint Smart Home

Background

Pratik Khowala sued Vivint Smart Home, Inc. and Vivint, Inc. over a security system installed at his home. He alleged that Vivint’s negligence caused the system to fail to alert law-enforcement officers when his home was burglarized in 2022. He also asserted products-liability and breach-of-contract claims.

Vivint previously moved to compel arbitration under the Federal Arbitration Act, but the court denied that motion without prejudice because Vivint had not presented enough evidence that an arbitration agreement had been formed. The court then allowed limited discovery on whether Khowala and Vivint had entered into such an agreement.

Vivint renewed its motion, relying on additional records and testimony. The records included Salesforce screenshots listing Khowala as the contract signer, recording a digital-contract signing time of August 29, 2016, and showing a service-activation time that day. A Vivint post-installation survey was recorded as passed at 2:50 p.m.; the digital contract was recorded as signed at 2:52 p.m. Vivint employee Bryan Brothers testified about Vivint’s procedures for conducting the survey and confirming that a customer had signed, or was about to sign, the service agreement before the survey was marked passed.

Khowala did not dispute the authenticity of the Salesforce records or the accuracy and reliability of Brothers’s declaration. He argued instead that a technician, Danny Urena, may have signed the 2016 agreement on an iPad. Khowala pointed to signatures on certain work orders that he did not recognize and made allegations of fraud. He testified that he did not recall signing the agreement, but he did not categorically deny signing it.

Legal Standard

Under the Federal Arbitration Act, a court must direct arbitration when it is satisfied that the parties agreed in writing to arbitrate the dispute. Whether an arbitration agreement was formed is decided under state contract law; the parties agreed that New York law applied here. The party seeking arbitration bears the initial burden of showing that an agreement was made.

When relevant facts are disputed on a motion to compel arbitration, the court applies a standard similar to the standard used for summary judgment. The court considers admissible evidence and draws reasonable inferences for the party opposing arbitration. If a genuine factual dispute remains about whether the agreement was made, the nonmoving party is entitled to a jury trial on that issue. If undisputed facts require a decision as a matter of law, the court may compel arbitration without further court proceedings.

Court’s Analysis

The court found that the undisputed evidence showed Khowala signed the 2016 System Purchase and Services Agreement. It relied on the Salesforce records, the timing and results of the post-installation survey, and Brothers’s testimony about Vivint’s customer-onboarding procedures.

The court concluded that Khowala’s evidence did not create a genuine factual dispute. His testimony that he could not recall signing the agreement was not the same as a categorical denial. The court also found that his assertions that Urena may have forged the signature were based on speculation and did not explain how the post-installation survey could have been fraudulently passed by multiple Vivint employees. The court further noted that Khowala did not challenge the reliability of Vivint’s records or the testimony describing its procedures.

Because it found that Khowala signed the agreement, the court did not address Vivint’s alternative argument that Khowala later reaffirmed the agreement when he extended his service contract in 2021.

Disposition

Judge Analisa Torres granted Vivint’s motion to compel arbitration. The court stayed the action pending arbitration under the 2016 agreement and directed the Clerk of Court to terminate the motion at ECF No. 29. The order did not decide the underlying negligence, products-liability, or breach-of-contract claims on their merits.