Broom v. AXA Equitable Life Insurance Company et al

Filing 41

MEMORANDUM OPINION. Signed by Judge R David Proctor on 8/15/2016. (AVC)

FILED
2016 Aug-15 PM 04:34
U.S. DISTRICT COURT
N.D. OF ALABAMA

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION

CURTIS BROOM, JR.,
Plaintiff,
v.
AXA ADVISORS, LLC &
AXA NETWORK, LLC,

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Case No.: 2:16-CV-0028-RDP

Defendants.

MEMORANDUM OPINION
This matter is before the court on Defendants’ Motion to Dismiss and Compel
Arbitration. (Doc. 31). The Motion has been fully briefed. (Docs. 37 and 40).
This case arises out of the termination of Plaintiff Curtis Broom from his work as a
financial advisor and independent contractor with the Defendants, AXA Advisors, LLC (“AXA
Advisors”) and AXA Network, LLC (“AXA Network”). Plaintiff claims that he was terminated
because of his race and his complaints of race discrimination on behalf of himself and other
African-American employees. Defendants respond that Plaintiff was terminated because he
engaged in business transactions that violated AXA Advisors’ policies.
Regardless of the merits of Plaintiff’s claims, Defendants seek to compel arbitration
under the Federal Arbitration Act (FAA), Rule 13200 of the Financial Industry Regulatory
Authority (“FINRA”), and several arbitration agreements entered into by the parties. Plaintiff
concedes that all claims from July 1, 2013, until his termination in May, 2014, are fully
arbitrable. However, he contends that, for several reasons, claims that accrued in the eighteen
months prior to July 1, 2013, are not subject to arbitration. This very well may be true. But, as

explained below, it is wholly irrelevant to the current motion. This is because the claims asserted
in Plaintiff’s Complaint accrued at the date of his termination, and Plaintiff readily concedes that,
at that time, he was subject to an arbitration agreement. Therefore, Defendants’ Motion to
Dismiss and Compel Arbitration is due to be granted.
I.

BACKGROUND
In May 1981, Plaintiff joined The Equitable Life Insurance Society of the United States

(“Equitable Life”), predecessor to former defendant AXA Equitable, as a financial agent under a
three year contract (the “1981 Agreement”). (Doc. 31-1 at ¶¶ 8-9, Ex. A p. 2). The 1981
Agreement did not contain an arbitration provision, but it did provide that the agreement would
be subject to any rules and regulations that the Equitable made or would make concerning the
conduct of its business. (Doc. 31-1, Ex. A p. 3).
In May 1984, upon the expiration of the 1981 Agreement, Plaintiff as an independent
contractor entered into a new, superseding agreement with Equitable Life (the “14th Edition
Agreement”). (Doc. 31-1 at ¶ 10, Ex. B pp. 1-2). Similar to its predecessor, the 14th Edition
Agreement did not contain an arbitration provision; rather, it provided that it was subject to other
rules and regulations as established by the Defendants. (Doc. 31-1, Ex. B p. 1). The 14th Edition
Agreement was effective through January 2000, when AXA Network assumed all previously
existing contractual rights and obligations between Equitable Life and Plaintiff. (Doc. 31-1 at ¶
11, Ex. C pp. 1-2).
The next agreement relevant to this case became effective in July 2013, when Plaintiff
entered into a 14th Edition RB (the “Retiree Agreement”) with AXA Network. (Doc. 31-1 at ¶
12, Ex. D). While maintaining Plaintiff’s status as an independent contractor, and unlike the

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previous agreements, the Retiree Agreement included an express arbitration provision which
provided:
The Associate agrees, as a condition of association with AXA Network, that any
controversy or dispute arising under this Agreement out of the Associate’s association
with AXA Network or any affiliate or subsidiary thereof, including, but not limited to,
claims of discrimination and/or harassment under federal or state statute or otherwise,
will be submitted to final and binding arbitration upon demand of either party… Any
arbitration pursuant to this Agreement shall be conducted in accordance with, and
governed by the Code of Arbitration Procedures of FINRA, if within the FINRA’s
jurisdiction, and if not, then by and in accordance with the rules and procedures of the
American Arbitration Association for commercial arbitrations.
(Doc. 31-1, Ex. D p. 3)
Additionally, in compliance with FINRA obligations, Plaintiff made several Form U4
submissions in April 2000, January 2001, September 2009, and February 2013. (Doc. 36-5 – 368). All of these submissions included arbitration provisions. (Doc. 36-5 ¶ 5, 36-6 p. 12, 36-7 p. 2,
36-8 p.1). The September 2009 and February 2013 Form U4 submissions directly reference
FINRA Conduct Rule 3080 and FINRA Rule 2263, respectively. (Doc. 36-7 p. 2, 36-8 p. 1).
Both of those rules mandate arbitration. (Id.).
Plaintiff was terminated in May 2014. (Doc. 1 p. 4). The reasons behind the termination
are disputed. Plaintiff claims that he was fired because of his race and because he complained
that African-American employees were treated in an unfair and discriminatory manner. (Id. at 34). He claims that he complained that not enough African-Americans were being hired and that
leads were not being distributed fairly to African-American employees on account of race. (Id.).
Defendants assert that Plaintiff was terminated because he “conducted business transactions that
violated AXA Advisors’ policies.” (Doc. 31 p. 9).
After his termination, Plaintiff filed a charge of discrimination with the Equal
Employment Opportunity Commission (“EEOC”), alleging violations of Title VII of the Civil

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Rights Act of 1964. (Doc. 31 p. 7). That charge was dismissed because the EEOC determined
that Plaintiff was an independent contractor, not an employee. (Doc. 31 p. 7). On January 6,
2016, Plaintiff initiated this lawsuit asserting claims of discrimination and retaliation on the basis
of race under 42 U.S.C. ' 1981. (Doc. 31 pp. 7-8). On June 3, 2016, after Plaintiff refused to
consent to arbitration Defendants filed the instant Motion to Dismiss and Compel Arbitration.
(Id. at p. 8).
II.

APPLICABLE LAW
Pursuant to the Federal Arbitration Act (“FAA”), a written arbitration provision in a

“contract evidencing a transaction involving [interstate] commerce” is “valid, irrevocable, and
enforceable, save upon such grounds as exist at law or in equity for the revocation of any
contract.” 9 U.S.C. § 2. Section 3 of the FAA provides that a district court must compel
arbitration and stay the underlying action if the parties had an earlier agreement to arbitrate their
dispute. 9 U.S.C. § 3.
The Supreme Court has held that the FAA represents a “liberal federal policy favoring
arbitration agreements.” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24
(1983). “Absent some violation of public policy, a federal court must refer to arbitration any
controversies covered by the provisions of an arbitration clause.” Telecom Italia, SPA v.
Wholesale Telecom Corp., 248 F.3d 1109, 1114 (11th Cir. 2001). “However, the policy fostered
by the FAA ‘does not require parties to arbitrate when they have not agreed to do so.’” Wheat,
First Sec., Inc. v. Green, 993 F.2d 814, 817 (11th Cir. 1993) (quoting Volt Info. Sciences, Inc. v.
Bd. of Trustees of Stanford Univ., 489 U.S. 468, 478 (1989)).
“Unless the parties clearly and unmistakably provide otherwise, the question of whether
the parties agreed to arbitrate is to be decided by the court, not the arbitrator.” AT&T

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Technologies, Inc. v. Comm. Workers of Am., 475 U.S. 643, 649 (1986). When asked to compel
arbitration of a dispute, the court’s first task “is to determine whether the parties agreed to
arbitrate that dispute.” Chastain v. Robinson-Humphrey Co., Inc., 957 F.2d 851, 854 (11th Cir.
1992) (internal quotations and citation omitted).
III.

DISCUSSION
Plaintiff does not dispute the validity of the arbitration provision of the Retirement

Agreement. In fact, he fully concedes that “all of his claims from July 1, 2013 until his
termination in May of 2014 are governed by the arbitration provision.” (Doc. 37 p. 4). But
Plaintiff contends that any claims that accrued between January 6, 2012, and July 1, 2013 are not
subject to arbitration for two reasons. (Id.). First, he argues that FINRA rules mandating
arbitration are not applicable to claims against AXA Network because it is not a FINRA member
and he never explicitly agreed to arbitrate with them prior to the July 1, 2013 Retirement
Agreement. (Id. at 5-6). Second, Plaintiff argues that all claims dealing with the sale of insurance
products prior to July 1, 2013 are not subject to mandatory arbitration under FINRA Rule
13200(b). (Id. at 6-7). These arguments are inapposite, however, because, in his Complaint,
Plaintiff made no claims that would have accrued prior to July 1, 2013. Both of the claims
asserted in his Complaint relate to his termination, which occurred in May 2014. (Doc. 1).
In particular, in his Complaint, Plaintiff asserts in Count One that he was terminated due
to his race in violation of 42 U.S.C. § 1981 (Doc. 1 pp. 4-5), and in Count Two that he was
terminated in retaliation for making complaints of race discrimination, also in violation section
1981. (Doc. 1 p. 5). A claim for wrongful termination generally accrues on the date of the
claimant’s termination. See Steven v. McKillop, 198 F.App’x 816, 817 (11th Cir. 2006) (holding
that a wrongful termination complaint accrues on the date of termination). See also Mullinax v.

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McElhenny, 817 F.2d 711, 716 (11th Cir. 1987) (holding that a cause of action under 42 U.S.C. §
1983 does not accrue until a Plaintiff knows or has reason to know that she has been injured.)
Although the alleged discriminatory activities about which Plaintiff complained preceded
his termination, the claims asserted in the Complaint are based on his termination. Because
Plaintiff concedes that both his termination claims accrued after July 1, 2013, they are subject to
arbitration. Accordingly, all claims asserted in the Complaint accrued on the date of Plaintiff’s
termination (in May 2014). Defendants’ Motion to Compel Arbitration is due to be granted.1
IV.

CONCLUSION
For the foregoing reasons, Defendants’ Motion to Dismiss and Compel Arbitration (Doc.

31) is due to be granted. A separate order will be entered.
DONE and ORDERED this August 15, 2016.

_________________________________
R. DAVID PROCTOR
UNITED STATES DISTRICT JUDGE

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To the extent Plaintiff argues that there are claims in addition to those related to his termination that have
been asserted in Counts One and Two of his Complaint, that argument fails for two reasons. First, the language in
the Complaint does not support such an argument. Second, such an argument is a non-starter because, even if the
language of the Complaint supported it, Plaintiff’s Complaint would violate the rule against impermissible shotgun
pleading. See Anderson v. Dist. Bd. of Trs. of Cent. Fla. Cmty. Coll., 77 F.3d 364, 366 (11th Cir. 1996) (stating that
multiple claims should be presented separately in adherence to Federal Rule of Civil Procedure 10(b)).

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