Plaintiff Youras Ziankovich respectfully submits this Plaintiff’s Response In Opposition To Defendant’s Motion To Compel Arbitration And Stay Proceedings, Or, In The Alternative, Motion To Dismiss (ECF Nos. 12 and 13).
I. INTRODUCTION
Defendant Wise US Inc. (“Wise”) moves to compel arbitration and dismiss Plaintiff’s claims based on an alleged agreement it cannot prove Plaintiff ever accepted. The Motion rests not on evidence of assent, but on speculation, and as such the Motion fails at the threshold.
Under the Federal Arbitration Act, arbitration is a matter of contract, and the party seeking to compel arbitration bears the burden of proving the existence of a valid agreement. See 9 U.S.C. § 2. Wise does not meet that burden. Instead of evidence of Plaintiff’s actual assent, Wise relies on a declaration describing general business practices and hypothetical user flows, without any record of what Plaintiff actually saw or agreed to.
Critically, Wise’s own evidence defeats its position. Its declarant admits that, at the time Plaintiff registered his account, Wise’s platform “would allow Plaintiff to complete the registration process without agreeing to the Terms of Use.” Macchiavello Decl. ¶ 23. This admission is fatal. A system that permits account creation without assent cannot establish mutual agreement, particularly for a provision waiving the constitutional right to a jury trial.
Wise also fails to establish that Plaintiff agreed to the specific Customer Agreement it now invokes. The Agreement attached to Wise’s Motion is dated September 12, 2025, while Plaintiff’s account was opened on August 29, 2025. Macchiavello Decl. ¶¶ 7-8; Ex. 2. Wise provides no evidence that this later version governed Plaintiff’s account or that Plaintiff assented to it.
Wise’s fallback argument, that arbitrability must be decided by the arbitrator, fails for the same reason. The purported delegation depends on incorporation of the American Arbitration Association (“AAA”) rules. But Wise offers no evidence that those rules were actually presented to or accepted by Plaintiff, as opposed to being attached later as litigation exhibits. See Def.’s Mem. at 4-6. Without proof of assent, there is no “clear and unmistakable” delegation. See First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995).
In short, Wise asks this Court to enforce an arbitration agreement it cannot show exists. The FAA does not permit courts to compel arbitration based on assumptions, generalized practices, or post hoc document assembly. Because Wise has failed to establish mutual assent to any arbitration agreement, or to any delegation provision, the Motion to Compel Arbitration must be denied.
Alternatively, even if the Court were to reach Wise’s Rule 12(b)(6) arguments, Plaintiff’s Complaint plausibly alleges claims under federal and state law arising from Defendant’s restriction and termination of his account. See Complaint (ECF No. 1).
As a pro se litigant, Plaintiff respectfully requests that his pleadings be construed liberally.
II. THE MOTION TO COMPEL ARBITRATION SHOULD BE DENIED
A. Defendant Fails to Produce Any Evidence of Assent
Arbitration is a matter of contract, and a party cannot be required to submit to arbitration any dispute which he has not agreed to arbitrate. See Kubala v. Supreme Prod. Servs., Inc., 830 F.3d 199, 201 (5th Cir. 2016).
Defendant bears the burden of proving the existence of a valid agreement to arbitrate by a preponderance of the evidence. Where the formation of an agreement is disputed, courts must resolve that issue before compelling arbitration.
Wise presents no direct evidence that Plaintiff agreed to the Customer Agreement. There is no signed agreement, no clickwrap acceptance, no record of assent, and no logs or timestamps showing that Plaintiff affirmatively accepted any terms. Defendant does not, and cannot, contend that Plaintiff actually accepted the Terms.
Instead, Defendant relies solely on a declaration describing general platform functionality and typical user flows, not Plaintiff’s actual conduct. See Macchiavello Declaration.
That is insufficient. A generalized description of how a system may operate does not establish that this Plaintiff saw, reviewed, or agreed to any specific terms.
Nor does Defendant offer any evidence that Plaintiff clicked an acceptance button, checked a box, or otherwise manifested agreement to the Terms. The declaration provides no account-specific data, no audit trail, and no documentary proof tying Plaintiff to any acceptance event.
Instead, Defendant asks the Court to infer assent based on speculation about what “would” have happened.
That is not enough. The absence of any record of assent is particularly significant where, as here, Defendant controls the relevant systems and records yet produces none. The FAA requires proof of an agreement, not assumptions and not post hoc reconstructions.
Because Defendant cannot show that Plaintiff agreed to the Customer Agreement, it cannot establish the existence of any arbitration agreement. If such evidence existed, Defendant would have produced it.
Defendant attempts to rely on generalized descriptions of its standard onboarding flow, rather than Plaintiff-specific evidence of assent. But under governing law, arbitration is a matter of contract, and the party seeking to compel arbitration bears the burden of proving the existence of an agreement with the particular plaintiff.
See Kubala v. Supreme Prod. Servs., Inc., 830 F.3d 199, 201-02 (5th Cir. 2016).
Generalized business practices or post hoc descriptions of how a system typically operates cannot substitute for proof that this Plaintiff actually received reasonably conspicuous notice and manifested assent.
B. Defendant’s Failure to Produce Assent Records Supports an Adverse Inference
The absence of any account-specific evidence of assent is not a neutral evidentiary gap. It is affirmative proof that Defendant cannot meet its burden.
Defendant exclusively controls the systems that would record user acceptance of any Terms of Use or Customer Agreement, including logs, timestamps, clickwrap records, and audit trails. If Plaintiff had, in fact, accepted an arbitration agreement, Defendant would necessarily possess such records in the ordinary course of its business.
Yet Defendant produces none.
This omission is not incidental. It is dispositive. Courts evaluating online contract formation routinely rely on precisely such records, including click logs, acceptance timestamps, or account-specific audit trails, to establish assent.
Defendant’s failure to produce any such evidence, while relying instead on generalized descriptions of how its system “would” operate, permits the reasonable inference that no such assent occurred.
Where a party bears the burden of proof and has exclusive control over the relevant evidence, its failure to produce that evidence supports an inference that the evidence would be unfavorable.
Here, that inference confirms what the record already shows: Defendant cannot establish that Plaintiff ever agreed to arbitrate.
C. Defendant’s Own Evidence Undermines Any Claim of Assent
Defendant’s motion fails for a second, independent reason: its own evidence undermines any claim that Plaintiff assented to the Terms at all.
Wise’s declarant admits that the platform “would allow Plaintiff to complete the registration process without agreeing to the Terms of Use.” Macchiavello Decl. ¶ 23.
That admission is incompatible with Defendant’s theory of contract formation.
If a user could complete registration without agreeing to the Terms, then assent was not required, and mutual assent cannot be inferred merely from account creation or use.
That defect is especially important here because Defendant offers no account-specific evidence showing that Plaintiff, in fact, did agree.
There is no signed agreement, no clickwrap record, no acceptance log, no timestamp tied to Plaintiff, and no preserved screenshot of the actual registration flow presented to Plaintiff on August 29, 2025.
Instead, Defendant relies on generalized descriptions of how the system allegedly worked.
That is not enough to carry Defendant’s burden.
Nor can Defendant cure that defect by arguing that Plaintiff’s later use of the platform constituted acceptance.
Continued use may in some circumstances evidence assent, but not where Defendant’s own proof shows that a user could register and proceed without any required acceptance and where Defendant has not shown that Plaintiff was clearly told that continued use would itself constitute agreement to arbitration.
On this record, Defendant has shown, at most, that assent may have been possible, not that assent actually occurred.
Because Defendant’s own evidence shows that agreement was optional rather than required, and because Defendant provides no Plaintiff-specific proof of acceptance, Defendant has failed to establish the existence of a binding arbitration agreement.
This is not merely a lack of evidence; it is an internal contradiction in Defendant’s own proof.
The same declaration that asserts Plaintiff agreed to the Terms also admits that agreement was not required to complete registration.
Such conclusory assertions, untethered to any account-specific record and contradicted by the declarant’s own factual admission, cannot establish assent as a matter of law.
D. Defendant Fails to Establish Reasonable Notice of Any Arbitration Terms
Even apart from the absence of actual assent, Defendant also fails to establish constructive notice.
Courts distinguish between enforceable clickwrap agreements, where users must affirmatively indicate assent, and browsewrap or sign-in-wrap arrangements, where terms are merely available via hyperlink.
The latter are enforceable only if the user is provided reasonably conspicuous notice of the terms and their legal effect.
Absent such notice, no agreement is formed.
As courts have held, where a website provides only a hyperlink to terms without requiring any affirmative manifestation of assent, a user’s continued use does not establish constructive notice.
See Nguyen v. Barnes & Noble Inc., 763 F.3d 1171, 1178-79 (9th Cir. 2014).
Similarly, terms are not binding where they are not clearly presented or require no affirmative assent.
See Specht v. Netscape Commc’ns Corp., 306 F.3d 17, 29-30 (2d Cir. 2002).
These principles align with Fifth Circuit law, which requires proof of notice and assent under ordinary contract principles before enforcing arbitration.
See Kubala v. Supreme Prod. Servs., Inc., 830 F.3d 199, 201-02 (5th Cir. 2016).
Here, Defendant offers no evidence that Plaintiff was provided with reasonably conspicuous notice of any arbitration provision.
It produces no screenshot of the registration interface, no archived version of the page presented to Plaintiff, no evidence of the placement or prominence of any purported notice, and no proof that Plaintiff was required to acknowledge the Terms before proceeding.
At most, Defendant describes a system in which terms were available via hyperlink.
That is insufficient as a matter of law.
The relevant inquiry is not how the system generally operates, but what was actually presented to this Plaintiff.
On this record, Defendant has failed to establish that Plaintiff had actual or constructive notice of any arbitration terms.
E. Continued Use Does Not Establish Assent Absent Clear Notice
Defendant may argue that Plaintiff’s continued use of the Wise platform constitutes acceptance of the Customer Agreement.
That argument fails.
Continued use establishes assent only where the user is clearly informed that such use will constitute acceptance of specific terms.
See Meyer v. Uber Techs., Inc., 868 F.3d 66, 75-79 (2d Cir. 2017).
Absent such notice, mere use of a service does not create a binding agreement, particularly one waiving the right to access the courts.
Here, Defendant offers no evidence that Plaintiff was ever informed that continued use of the platform would constitute agreement to arbitration.
There is no record of any interface conveying such notice, no preserved screenshot, and no evidence of any required action manifesting assent.
To the contrary, Defendant’s own declarant admits that a user could create an account without agreeing to the Terms.
On this record, Defendant has shown only that Plaintiff used the service, not that he was placed on notice that such use would bind him to arbitration.
That is insufficient as a matter of law.
F. Defendant Relies on a Different, Later-Dated Agreement
Defendant also fails to establish that Plaintiff agreed to the specific agreement it now seeks to enforce.
This defect is compounded by Defendant’s own contractual terms. The Customer Agreement on which Defendant relies expressly provides that Wise may modify the Agreement from time to time.
Where a party reserves the right to unilaterally modify its terms, the existence of multiple versions of the agreement is not hypothetical but inherent.
In such circumstances, the party seeking to enforce arbitration must establish which specific version of the agreement governed the relationship at the relevant time and that the plaintiff assented to that version.
Defendant has done neither.
It has produced only a later-dated agreement, without any version history, without identifying the terms in effect on August 29, 2025, and without any evidence that Plaintiff was notified of or assented to any modification.
This is not a mere evidentiary gap.
It is a failure of proof as to the essential terms of the alleged contract.
A party cannot compel arbitration based on a document it cannot tie to the plaintiff in time, version, or assent, particularly where the party itself claims the right to alter those terms unilaterally.
Wise relies on a Customer Agreement dated September 12, 2025.
But Defendant’s own evidence shows that Plaintiff opened his account on August 29, 2025.
Defendant therefore seeks to enforce a version of the agreement that post-dates Plaintiff’s account opening, without supplying any competent evidence that this was the version in effect when Plaintiff registered or that Plaintiff later received notice of, and assented to, that updated version.
That is not a technical defect.
It goes directly to contract formation.
To compel arbitration, Defendant must show that Plaintiff agreed to the same set of terms Defendant now invokes.
Yet Defendant provides no version-control evidence, no archived August 29, 2025 agreement, no business record showing what terms governed Plaintiff’s registration, and no record that Plaintiff later accepted the September 12, 2025 version.
Without such proof, Defendant cannot establish a meeting of the minds as to the specific arbitration provision before the Court.
This gap in proof independently defeats the motion.
A party cannot compel arbitration based on a later-dated agreement without proving that the agreement governed the account at the relevant time or was later validly accepted.
Defendant has shown neither.
Defendant seeks to enforce a contract it cannot tie to Plaintiff in time, version, or assent.
Where the proponent of arbitration cannot identify the operative contract, arbitration cannot be compelled.
G. At Minimum, Contract Formation Is Genuinely Disputed and Cannot Be Resolved on This Record
At minimum, the present record establishes a genuine dispute as to contract formation.
Plaintiff denies that he knowingly or affirmatively agreed to any arbitration provision.
Defendant, meanwhile, offers no Plaintiff-specific evidence of acceptance and relies instead on generalized testimony that is internally problematic and, more importantly, reflects a direct conflict between a factual admission (that agreement was not required) and a conclusory assertion (that Plaintiff nevertheless agreed).
On the one hand, Defendant claims Plaintiff agreed to the Terms.
On the other hand, its declarant admits that Plaintiff could complete registration without agreeing to them.
That contradiction, combined with the absence of account-specific assent evidence and Defendant’s reliance on a later-dated agreement, precludes any finding that arbitration has been established as a matter of law.
Under the FAA, the Court must decide whether an agreement to arbitrate was formed before compelling arbitration.
Where the making of the arbitration agreement is genuinely in issue, the Court may not simply assume assent from general business practices or litigation-era reconstruction.
On this record, Defendant has not met its burden to prove a valid agreement to arbitrate.
On this record, Defendant has failed to produce evidence from which assent could be found.
The Motion must be denied.
H. No Clear and Unmistakable Delegation of Arbitrability
Delegation cannot exist independently of contract formation.
Where no agreement is proven, there is nothing to delegate.
Even if Defendant could establish the existence of an arbitration agreement, which it cannot, it still fails to demonstrate that questions of arbitrability have been delegated to an arbitrator.
As a threshold matter, a party cannot rely on a delegation provision unless it first establishes that an agreement was actually formed.
A challenge to the existence of any agreement necessarily precedes and defeats any alleged delegation.
Courts do not enforce delegation clauses where the very formation of the contract is in dispute.
Here, Plaintiff does not merely challenge the scope or enforceability of an arbitration provision, but denies that any agreement was ever formed.
Because Defendant has failed to establish mutual assent to any contract, it cannot rely on any purported delegation provision within that contract or through incorporation of external rules.
The question of arbitrability therefore remains for the Court.
The Customer Agreement itself contains no provision stating that the arbitrator has authority to decide issues of arbitrability.
Instead, Defendant relies on Rule R-7(a) of the American Arbitration Association (“AAA”) Consumer Arbitration Rules, which it attaches as a separate exhibit.
See Def.’s Mem. at 4-6; Ex. B.
Defendant’s reliance on incorporation by reference is misplaced.
Incorporation requires that the referenced material be clearly identified and readily available and, critically, that the party be placed on notice that such external rules carry independent legal consequences, including delegation of arbitrability, at the time of assent.
Here, Defendant has not shown that the AAA rules were presented to Plaintiff, made readily accessible, or otherwise incorporated in a manner that would provide meaningful notice.
Absent such proof, external rules cannot be used to impose additional terms, let alone a delegation of arbitrability.
Moreover, Defendant’s evidence underscores the problem.
Its Exhibit A, the Agreement it claims governs, does not contain the AAA rules or any delegation language.
Defendant instead introduces those rules separately, through Exhibit B, as part of its litigation submission.
This post hoc assembly of materials does not establish that Plaintiff agreed to delegate arbitrability.
Delegation requires “clear and unmistakable” evidence of agreement.
First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995).
Where, as here, assent to the underlying agreement is disputed and the alleged delegation appears only in external materials not shown to have been accepted, that standard is not met.
Because Defendant has failed to establish that Plaintiff assented to any agreement at all, the Court need not, and cannot, reach any question of delegation based on incorporation of external rules.
Defendant’s reliance on case law holding that incorporation of AAA rules constitutes delegation is misplaced.
Those cases presuppose the existence of a valid agreement and undisputed assent to the terms incorporating such rules.
Where, as here, the very formation of the agreement is disputed and Defendant has failed to establish that Plaintiff agreed to any terms at all, those authorities do not apply.
Accordingly, the Court, not an arbitrator, must decide whether any arbitration agreement exists.
I. The Court, Not an Arbitrator, Must Decide Arbitrability
Because Defendant has failed to establish a clear and unmistakable delegation of arbitrability, the threshold question of whether any arbitration agreement exists must be decided by this Court.
As explained above, the alleged delegation rests entirely on external AAA rules that Defendant has not shown were presented to or accepted by Plaintiff.
Where assent to the underlying agreement is disputed, and where the purported delegation provision appears only in materials outside the agreement itself, courts do not presume that the parties agreed to arbitrate arbitrability.
See First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995).
Accordingly, the Court must decide whether a valid arbitration agreement exists.
And because Defendant has failed to meet its burden to prove assent, the Motion to Compel Arbitration should be denied.
J. At Minimum, the Case Should Be Stayed, Not Dismissed
Even if the Court were to compel arbitration, dismissal would be improper.
The Federal Arbitration Act provides that, upon finding an issue referable to arbitration, the Court “shall … stay the trial of the action” pending arbitration.
9 U.S.C. § 3.
The statute contemplates a stay, not dismissal, so that the Court retains jurisdiction to enforce, confirm, or vacate any arbitral award.
Defendant offers no basis to depart from this rule.
Accordingly, at a minimum, the Court should deny Defendant’s request for dismissal and instead stay the proceedings pending any arbitration.
K. Defendant’s Anticipated Arguments Do Not Cure Its Failure of Proof
None of Defendant’s anticipated arguments cure its failure to establish the existence of an agreement.
First, Defendant may argue that Plaintiff’s use of the platform constitutes acceptance.
But continued use establishes assent only where the user is provided with clear and conspicuous notice.
Defendant has produced no such evidence.
It offers no screenshots, no interface records, and no account-specific data showing that Plaintiff was informed that use of the platform would constitute acceptance of arbitration.
Its own declarant admits that agreement to the Terms was not required to create an account.
On this record, use cannot substitute for assent.
Second, Defendant may rely on generalized descriptions of its registration process to argue that assent “would have occurred.”
That argument improperly shifts the burden.
The FAA requires proof of an agreement, not assumptions about how a system typically operates.
Where Defendant controls the relevant records but produces no account-specific evidence of assent, no logs, no timestamps, no acceptance records, courts do not compel arbitration based on speculation.
Third, Defendant may invoke incorporation of the AAA rules to argue that arbitrability must be decided by the arbitrator.
But that argument presupposes the existence of a valid agreement.
Where formation itself is disputed and Defendant has failed to establish assent, there is no basis to enforce any purported delegation provision.
Delegation requires “clear and unmistakable” evidence of agreement, which is absent here.
First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995).
Finally, Defendant may attempt to characterize Plaintiff’s challenge as conclusory.
It is not.
Plaintiff has submitted sworn testimony denying assent.
That evidence, combined with Defendant’s failure to produce any account-specific record of acceptance and its reliance on a later-dated agreement, creates a genuine dispute as to contract formation that cannot be resolved in favor of arbitration.
Defendant’s arguments do not supply the missing proof.
They underscore it.
III. ALTERNATIVELY, DEFENDANT’S RULE 12(B)(6) MOTION SHOULD BE DENIED
A. Legal Standard
To survive a motion to dismiss under Rule 12(b)(6), a complaint need only contain sufficient factual matter to state a claim that is plausible on its face.
The Court must accept all well-pleaded facts as true and view them in the light most favorable to the plaintiff.
At this stage, Plaintiff is not required to prove his claims or present evidence, only to allege facts that, if true, state a plausible entitlement to relief.
Defendant’s Motion improperly demands evidentiary detail and definitive proof, which is not required at the pleading stage.
Dismissal is appropriate only where the complaint fails to allege sufficient facts to raise a reasonable inference of liability, not where, as here, Plaintiff has plausibly alleged misconduct.
B. Plaintiff’s § 1981 Claim Is Plausibly Alleged
Defendant’s argument that Plaintiff fails to state a claim under 42 U.S.C. § 1981 rests on an unduly narrow and legally incorrect view of what constitutes actionable discrimination under the statute.
Section 1981 protects against intentional discrimination in the making and enforcement of contracts, including discrimination based on race, ethnicity, and ancestry.
The Supreme Court has made clear that § 1981 is not limited to modern or rigid racial classifications, but extends to discrimination based on “ancestry or ethnic characteristics.”
Saint Francis Coll. v. Al-Khazraji, 481 U.S. 604, 613 (1987).
In that case, the Court held that discrimination against individuals of Arab descent could constitute racial discrimination under § 1981, explaining that the statute protects identifiable classes of persons who are subjected to intentional discrimination because of their ethnic origin.
Accordingly, Defendant’s assertion that Plaintiff’s identity as a Belarusian cannot support a § 1981 claim is legally flawed.
Discrimination based on national origin can fall within § 1981 where it functions as a proxy for ancestry or ethnic identity.
See Village of Freeport v. Barrella, 814 F.3d 594, 606 (2d Cir. 2016) (recognizing that Hispanic ethnicity may constitute a protected class under § 1981 because it reflects ancestry and ethnic characteristics).
Courts have consistently rejected attempts to artificially separate national origin from race where the alleged discrimination is tied to ethnic identity.
Moreover, at the pleading stage, Plaintiff is not required to conclusively establish the precise contours of the protected class, but only to allege facts supporting a plausible inference of intentional discrimination affecting contractual rights.
See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Plaintiff has done so.
The Complaint alleges that Defendant restricted and terminated Plaintiff’s account based on perceived characteristics tied to his identity and associations, including the use of “Belarus” as a risk marker and proxy for adverse treatment.
These allegations plausibly support an inference that Defendant engaged in selective enforcement of its policies in a manner that interfered with Plaintiff’s contractual rights.
Importantly, § 1981 requires but-for causation, not detailed evidentiary proof at the pleading stage.
See Comcast Corp. v. Nat’l Ass’n of African Am.-Owned Media, 589 U.S. 327, 339 (2020).
Plaintiff satisfies this standard by alleging that Defendant’s actions were motivated, at least in part, by discriminatory considerations tied to his identity and that such actions impaired his ability to use and benefit from his contractual relationship with Wise.
Defendant’s reliance on cases dismissing conclusory allegations is misplaced.
Unlike those cases, Plaintiff does not rely on bare assertions of unfair treatment, but alleges specific conduct, account restrictions, termination, and invocation of compliance-related justifications, that plausibly supports an inference of discriminatory intent and selective enforcement.
At this stage, those allegations must be accepted as true and construed in Plaintiff’s favor.
Accordingly, Plaintiff has stated a plausible claim under § 1981, and Defendant’s motion to dismiss this claim should be denied.
C. Plaintiff’s Breach of Contract Claim Is Plausibly Alleged
Defendant argues that Plaintiff’s breach of contract claim fails because Plaintiff does not identify a specific contractual provision allegedly breached.
That argument misstates both Texas law and the applicable pleading standard.
Under Texas law, a breach of contract claim requires:
- a valid contract;
- performance or tendered performance by the plaintiff;
- breach by the defendant; and
- damages resulting from the breach.
Mullins v. TestAmerica, Inc., 564 F.3d 386, 418 (5th Cir. 2009); Smith Int’l, Inc. v. Egle Grp., LLC, 490 F.3d 380, 387 (5th Cir. 2007).
At the pleading stage, however, a plaintiff need only allege facts that plausibly support the existence of a contract and its breach.
See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
The Fifth Circuit has made clear that dismissal is improper where the complaint plausibly alleges that the defendant failed to perform obligations arising under the parties’ agreement.
Innova Hosp. San Antonio, L.P. v. Blue Cross & Blue Shield of Ga., Inc., 892 F.3d 719, 728 (5th Cir. 2018).
Here, Plaintiff alleges that he maintained a Wise account governed by Defendant’s Customer Agreement, performed his obligations, and that Defendant nevertheless restricted and/or terminated his account, preventing him from accessing and using his funds.
These allegations directly implicate the core contractual subject matter, namely, the provision of account services, including the ability to hold, transfer, and access funds.
Defendant’s own Customer Agreement confirms that these functions are central to the contract.
The Agreement defines the “Wise Account” as a service that allows users to “hold, spend, send, and receive money,” and describes “Transfers” as a core function of the service.
These provisions establish that access to funds and the ability to execute transactions are fundamental contractual benefits, not incidental features.
While the Agreement also states that Wise “retain[s] full discretion to refuse to accept any user or to complete any instruction to Transfer … at any time,” Texas law does not permit a party to exercise contractual discretion in a manner that renders its promises illusory or deprives the counterparty of the benefit of the bargain.
See Vanegas v. Am. Energy Servs., 302 S.W.3d 299, 303 (Tex. 2009).
A contract must impose real obligations and cannot be entirely discretionary.
An arbitration agreement may be illusory if one party retains the unrestricted right to avoid its obligations.
However, Texas courts enforce such provisions only where modification rights are meaningfully constrained.
See In re Halliburton Co., 80 S.W.3d 566, 569-70 (Tex. 2002).
Here, unlike in Halliburton, Defendant has produced no evidence of any limitation on its ability to alter terms or bind users retroactively, further undermining the existence of a valid agreement.
Even where discretion exists, it must be exercised consistently with the contract’s structure and purpose.
Critically, Defendant’s own declarant admits that a user could complete registration without agreeing to the Terms of Use. (Ex. A ¶ 23.)
This admission is fatal to any theory of mandatory assent and distinguishes this case from those enforcing clickwrap or sign-in-wrap agreements.
Plaintiff plausibly alleges that Defendant’s actions, restricting and/or terminating his account without sufficient justification, went beyond permissible discretion and effectively deprived him of the essential benefits of the agreement, including access to his funds and the ability to transact.
Such conduct constitutes a breach of contract under Texas law.
To the extent Defendant argues that Plaintiff must identify a specific clause verbatim, courts have rejected such a heightened requirement.
A complaint is sufficient where it provides the defendant with fair notice of the claim and the grounds upon which it rests.
Great Plains Trust Co. v. Morgan Stanley Dean Witter & Co., 313 F.3d 305, 329 (5th Cir. 2002).
Plaintiff’s allegations, focused on the restriction of account access and interference with core account functions, plainly satisfy that standard.
Moreover, the relevant contractual provisions are within Defendant’s possession and control.
Defendant has produced the Customer Agreement and is fully aware of the terms governing the account.
Rule 8 does not require Plaintiff to quote or parse those provisions in detail at the pleading stage, particularly where the alleged breach concerns the central purpose of the contract itself.
Accordingly, Plaintiff has plausibly alleged a breach of contract, and Defendant’s motion to dismiss this claim should be denied.
D. Plaintiff’s Defamation Claim Is Plausibly Alleged
Defendant argues that Plaintiff fails to allege publication of any defamatory statement to a third party.
That argument fails in light of the specific statements made by Defendant and the context in which those statements were issued.
Under Texas law, defamation requires:
- a false statement of fact;
- publication to a third party;
- fault; and
- damages, unless the statement constitutes defamation per se.
In re Lipsky, 460 S.W.3d 579, 593 (Tex. 2015).
Plaintiff plausibly alleges that Defendant made false statements accusing him of unlawful conduct in connection with international sanctions.
In particular, Defendant informed Plaintiff that his transfer “may potentially violate international sanctions laws” and questioned how the transaction was “connected to Belarus.”
These statements reasonably imply that Plaintiff was engaged in conduct violating sanctions laws.
Defendant further escalated those accusations by stating that attempting to send money connected to certain regions, including Belarus, “by withholding or changing information is against international sanctions law.”
Such statements convey that Plaintiff was suspected of sanctions evasion or dishonest conduct.
Defendant’s attempt to characterize the statements as purely internal communications is contradicted by the nature of its own operations.
The challenged statements were made in the context of a sanctions compliance process involving multiple entities and external financial systems.
Defendant linked Plaintiff’s account to third-party providers such as MoneyGram and processed transactions involving financial institutions including JPMorgan Chase.
In such a system, sanctions-related flags, determinations, and risk characterizations are necessarily communicated across institutional boundaries and are not confined to a single internal communication.
Under Texas law, statements accusing a person of illegal or dishonest conduct constitute defamation per se.
In re Lipsky, 460 S.W.3d at 596.
Defendant’s publication argument is equally unavailing.
The statements at issue were made within a financial compliance and sanctions-review system that inherently involves third-party communication and reliance.
Defendant’s own records confirm that Plaintiff’s account and transactions were integrated into a broader financial network involving external entities.
Defendant linked Plaintiff’s account to a third-party payment provider, MoneyGram, and processed transactions involving financial institutions such as JPMorgan Chase.
In such a system, sanctions-related determinations and risk flags are not confined to a single internal communication, but are part of compliance processes that involve dissemination across internal teams and external financial partners.
Publication may be satisfied where the defendant communicates defamatory statements to third parties or where such communication is the natural and probable consequence of the defendant’s conduct.
See, e.g., Randall’s Food Mkts., Inc. v. Johnson, 891 S.W.2d 640, 646-47 (Tex. 1995).
Here, Plaintiff alleges that Defendant’s statements were transmitted within established financial and compliance channels involving third-party institutions, including payment processors and banking partners, making third-party dissemination not merely foreseeable but inherent in Defendant’s conduct.
At minimum, the circumstances under which Defendant made the statements make repetition to third parties not only foreseeable, but inherent.
Financial institutions do not conduct sanctions reviews in isolation; such determinations are integrated into payment networks, compliance systems, and partner institutions.
Under Texas law, publication includes statements made under circumstances where dissemination to third parties is the natural and foreseeable consequence.
Here, Defendant’s own processes make such dissemination unavoidable.
Moreover, Defendant’s statements were not ephemeral.
They were recorded and incorporated into compliance systems that govern account restrictions, transaction processing, and interactions with third-party financial institutions.
The act of recording and maintaining such statements within systems that inform external transactions constitutes publication under Texas law.
Even if Defendant invokes a qualified privilege applicable to financial institutions, that privilege does not apply at the pleading stage where Plaintiff plausibly alleges abuse.
Defendant did not merely relay neutral facts, but affirmatively suggested unlawful conduct, namely, potential violations of international sanctions laws, without a factual basis.
Such statements go beyond necessary compliance reporting and support a plausible inference of reckless disregard for the truth.
Under Texas law, a qualified privilege is defeated where the defendant acts with malice or abuses the privilege.
See Randall’s Food Mkts., Inc. v. Johnson, 891 S.W.2d 640, 646 (Tex. 1995).
Malice includes making statements with knowledge of falsity or reckless disregard for the truth, as well as excessive publication beyond what is reasonably necessary.
Plaintiff plausibly alleges that Defendant abused any such privilege.
Defendant did not merely report objective facts or neutrally flag a transaction; it affirmatively characterized Plaintiff’s conduct as potentially unlawful and suggested sanctions violations without a factual basis.
The communications themselves show that Defendant relied on broad geographic associations (“connected to Belarus”) rather than specific evidence of wrongdoing.
Moreover, Defendant escalated its accusations by implying that Plaintiff was attempting to evade sanctions laws and then used those same accusations to justify restricting and ultimately terminating Plaintiff’s account.
Such conduct supports a plausible inference of reckless disregard for the truth or improper use of compliance mechanisms.
Additionally, to the extent Defendant disseminated or recorded these accusations within systems involving third-party financial institutions or partners, such dissemination would exceed what is strictly necessary for internal review and would constitute excessive publication.
At the pleading stage, Plaintiff is not required to disprove privilege or establish malice with evidentiary detail.
It is sufficient to allege facts supporting a plausible inference that any privilege was abused.
Plaintiff has done so.
Plaintiff further alleges concrete harm arising from these statements, including the restriction and termination of his account and resulting interference with his financial activities.
Allegations of sanctions violations in the financial sector carry significant reputational and practical consequences, supporting damages.
At a minimum, whether Defendant’s statements were communicated beyond a purely internal context, and whether any privilege applies, are factual questions that cannot be resolved on a motion to dismiss.
Accordingly, Plaintiff has plausibly alleged defamation under Texas law, and Defendant’s motion to dismiss this claim should be denied.
Alternatively, Plaintiff respectfully requests leave to amend.
E. Plaintiff’s False Light Claim Should Be Dismissed Without Prejudice, with Leave to Amend
Defendant correctly notes that Texas law does not recognize a standalone claim for false light invasion of privacy.
To the extent Plaintiff’s Complaint may be construed as asserting such a claim, Plaintiff does not oppose its dismissal.
However, any such dismissal should be without prejudice.
Plaintiff respectfully requests leave to amend to replead the underlying factual allegations, as appropriate, under recognized legal theories.
F. Leave to Amend
To the extent the Court finds any deficiency in Plaintiff’s pleading, Plaintiff respectfully requests leave to amend the Complaint to cure such deficiencies.
Leave to amend should be freely granted when justice so requires, particularly where, as here, any perceived deficiencies relate to the level of factual detail rather than the absence of a viable claim.
Granting leave to amend will ensure that the case is resolved on its merits rather than on technical pleading issues.
IV. CONCLUSION
For the foregoing reasons, Defendant has failed to meet its burden of proving the existence of a valid agreement to arbitrate.
Its Motion to Compel Arbitration should therefore be denied.
Defendant asks this Court to compel arbitration based on an agreement it cannot prove exists.
The FAA does not authorize courts to compel arbitration in the absence of a proven agreement.
Defendant’s alternative request to dismiss the Complaint under Rule 12(b)(6) should likewise be denied.
Plaintiff has plausibly alleged claims under federal and state law sufficient to proceed to discovery.
Alternatively, to the extent the Court finds any deficiency in Plaintiff’s pleading, Plaintiff respectfully requests leave to amend.
And if the Court were to compel arbitration, it should stay, rather than dismiss, the proceedings pursuant to 9 U.S.C. § 3.
Accordingly, Plaintiff respectfully requests that the Court deny Defendant’s Motion in its entirety and grant such other relief as the Court deems just and proper.
Dated at Baytown, Texas this 27th day of March 2026.
Respectfully submitted,
Youras Ziankovich, Esq.
Plaintiff Pro Se