SAN FRANCISCO — Sirius XM Radio Inc. went too far when the satellite radio company quietly pulled Toyota purchasers into arbitration agreements, the Ninth Circuit ruled Monday. Sirius XM, sued for making unauthorized telemarketing calls to “customers” whose new Toyotas included the satellite service, successfully pushed those claims into arbitration with a 2012 trial court decision. But the U.S. Court of Appeals for the Ninth Circuit returned the case to the courtroom, ruling named plaintiff Erik Knutson didn’t know about or consent to Sirius XM’s arbitration agreement.
Knutson unknowingly became a Sirius XM customer in 2011, when he bought a Toyota Tacoma truck and received a free 90-day trial subscription to the service. A month later, Knutson received a Sirius “welcome kit” that contained the company’s arbitration agreement. The agreement bound Knutson to arbitration unless he canceled his satellite radio subscription within three business days.
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