Allen et al v. Hartford Fire Insurance Company
Filing
162
ORDER granting 96 motion to dismiss. Signed by Judge Roy B. Dalton, Jr. on 8/25/2017. (SN)
Case 6:16-cv-01603-RBD-KRS Document 162 Filed 08/25/17 Page 1 of 10 PageID 1101
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
CORDELL ALLEN; ALIA CLARK;
PATRICIA DEARTH; CHRIS
DEPIERRO; JESSICA LEIGHTON;
JESSICA PEREZ; JAMIE RIVERA;
LAYFON ROSU; MARISSA SHIMKO;
and CAROL SOMERS,
Plaintiffs,
v.
Case No. 6:16-cv-1603-Orl-37KRS
HARTFORD FIRE INSURANCE
COMPANY,
Defendant.
_____________________________________
ORDER
In this action, Plaintiffs Cordell Allen, Alia Clark, Patricia Dearth, Chris DePierro,
Jessica Leighton, Jessica Perez, Jamie Rivera, Layfon Rosu, Marissa Shimko, and Carol
Somers (“Named Plaintiffs”) seek relief under the Fair Labor Standards Act (“FLSA”)
on behalf of themselves and other similarly situated employees. (Doc. 11.) As such,
Plaintiffs moved to conditionally certify a collective class of disability claims analysts
employed by Defendant Hartford Fire Insurance Company (“The Hartford”). (Doc. 51
(“Motion to Certify”).) 1
In the present motion, The Hartford moves to dismiss the claims of four Named
The Court has partially granted the Motion to Certify in a contemporaneously
filed Order.
1
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Plaintiffs and ten opt-in plaintiffs for lack of subject matter jurisdiction. (Doc. 96
(“MTD”); see also Doc. 132.) 2 Specifically, the MTD argues that the Court does not have
jurisdiction
over
these
claims
because
the
employees
agreed
to
submit
employment-related disputes to arbitration. (Doc. 96.) Plaintiffs oppose the motion.
(Docs. 123, 133.) For the reasons set forth below, the Court finds that the MTD is due to
be granted.
I.
BACKGROUND
The Hartford’s arbitration policy covers all employees: (1) who received a written
offer of employment on or before March 7, 2017; and (2) whose first day of work was on
or after April 1, 2012. (“New Hires”). (Doc. 96-3 (“Arbitration Policy”).) According to an
affidavit submitted by compliance officer Maria Q. Fazzino (“Ms. Fazzino”), “The
Hartford requires new employees to review and agree to comply with an Arbitration
Policy and a New Hire Agreement.” (Doc. 96-1, ¶¶ 1, 2.) “When an employee certifies
that he or she has reviewed and agreed to comply with the Arbitration Policy and New
Hire Agreement, he or she receives a Certificate of Completion, which includes their
name and the date and time they completed the process.” (Id. ¶ 4.) “A Certificate of
Completion is also stored electronically by The Hartford.” (Id.)
To support their MTD, The Hartford has produced copies of Certificates of
At the time that the MTD was filed, twenty-six non-named employees had
submitted notices consenting to opt into this action (“Opt-In Plaintiffs”) (Docs. 2-1, 2-2,
6-1, 6-2, 7, 8, 9, 10, 12, 13, 15, 19, 20, 21, 22, 37, 38, 39, 40, 43, 46, 47, 48, 49, 58, 59.) Since
that time, ten additional Opt-In Plaintiffs have filed consent-to-join notices. (Docs. 106,
108, 124, 125, 131, 141, 144, 145, 155, 160.)
2
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Completion certifying that Scott Agnew, Cordell Allen, Antonia Britt, Bretton Scott
Brown, Alia Clark, Melissa Cooper, Chris DePierro, Yanique Dixon, Jessica Leighton,
Michael Milton, Monica Tinsley, and Jordan Watkins (“Arbitration New Hires”)
reviewed and agreed to comply with the Arbitration Policy and The New Hire
Agreement. (Doc. 96-1, ¶ 4; see also Docs. 96-7, 96-8, 96-9, 96-10, 96-11, 96-12, 96-13, 96-14,
96-15, 96-16, 96-17, 96-18.)
Additionally, on August 19, 2015, The Hartford offered other employees the
option of agreeing to the Arbitration Policy in exchange for one additional day of paid
time off (“PTO Offer”). 3 (Doc. 96-1, ¶ 6.) Hence The Hartford’s Arbitration Policy also
covers employees who accepted the PTO Offer. (See Doc. 96, pp. 4–5.)
In her affidavit, Ms. Fazzino avers that the process by which employees selected
whether to agree to the PTO Offer was electronic. (Doc. 96-1, ¶ 7.) “After accepting or
declining participation in the Arbitration Policy, each employee who responded to the
offer received an Arbitration Policy Certification stating whether they chose to agree to
the Arbitration Policy and the date on which they made their choice.” (Id. ¶ 8.) Baronda
In a related action, the Court conditionally certified a 29 U.S.C. § 216(b) class of
“Analysts” who: (1) had worked for The Hartford at either its Maitland, Florida or Lake
Mary, Florida locations during the preceding three years; and (2) worked more than forty
hours in a workweek without being paid overtime compensation. Monserrate v. Hartford
Fire Ins. Co., Case No. 6:14-cv-149-Orl-37GJK (“Monserrate”), Doc. 129 (M.D. Fla. July 2,
2015). According to The Hartford, it purposefully excluded members of the Monserrate
class from the PTO Offer to prevent taking any action “that could interfere with their
right to join the lawsuit” or that “could be viewed as confusing their decision.”
Monserrate, Doc. 189-1, ¶¶ 8–11, 15–16, 20. But due to database coding errors, The
Hartford inadvertently sent the PTO Offer to three individuals within the Monserrate
class. See id. ¶¶ 8–11, 21.
3
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Staten (“Ms. Staten”) and Steven Wright (“Mr. Wright”) assented to the Arbitration
Policy by accepting the PTO Offer and electronically checking a box that read “Yes I have
read, understand and agree to comply with the Arbitration Policy.” (Docs. 96-24, 96-25.)
Based on the foregoing, The Hartford requests that the Court dismiss the claims of
the Arbitration New Hires, Ms. Staten, and Mr. Wright for lack of jurisdiction. (Doc. 96.)
In their response, Plaintiffs argue that the arbitration agreements are unenforceable
because The Hartford knowingly misclassified employees as exempt and engaged in
misconduct during the pendency of Monserrate. (Docs. 123, 133.) Notwithstanding
Plaintiffs’ claims of misconduct, the Court finds that MTD is due to be granted.
II.
LEGAL STANDARDS
Under the Federal Arbitration Act (“FAA”), “courts must rigorously enforce
arbitration agreements according to their terms.” Am. Express Co. v. Italian Colors Rest.,
133 S. Ct. 2304, 2309 (2013). Upon the motion of any party to a valid arbitration agreement,
courts must stay or dismiss litigation of all claims that fall within the agreement’s scope
and compel arbitration according to the agreement’s terms. See 9 U.S.C. §§ 3–4. Several
courts within this District have treated motions to dismiss in favor of arbitration as
motions challenging subject matter jurisdiction pursuant to Federal Rule of Civil
Procedure 12(b)(1). 4
E.g., Schriever v. Navient Sols., Inc., No. 2:14-cv-596-FtM-38CM, 2014 WL 7273915,
at *2, *3 (M.D. Fla. Dec. 19, 2014); Wash v. Mac Acquisition of Del., LLC,
No. 6:14-cv-1424-Orl-40TBS, 2014 WL 5173504, at *1 (M.D. Fla. Oct. 14, 2014); Bell v. Atl.
Trucking Co., No. 3:09-cv-406-J-32MCR, 2009 WL 4730564, at *2 (M.D. Fla. Dec. 7, 2009),
aff’d, 405 F. App’x 370 (11th Cir. 2010).
4
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Arbitration agreements are presumptively valid and enforceable. See 9 U.S.C. § 2.
However, arbitration under the FAA is ultimately “a matter of consent, not coercion,”
Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford Jr. Univ., 489 U.S. 468, 479 (1989), and
parties opposing arbitration can challenge the formation and validity of a contract
containing an arbitration clause. Specifically, the Eleventh Circuit recognizes “three
distinct types of challenges to a contract containing an arbitration clause”: (1) challenges
to the formation, or “the very existence,” of the contract; (2) challenges “to the validity of
the arbitration clause standing alone”; and (3) challenges “to the validity of the contract
as a whole.” Wiand v. Schneiderman, 778 F.3d 917, 924 (11th Cir. 2015).
Nonetheless, under a delegation provision “parties may agree to commit even
threshold determinations to an arbitrator, such as whether an arbitration agreement is
enforceable.” Parnell, 804 F.3d at 1146.
III.
A.
ANALYSIS
Choice of Law
“When deciding whether the parties agreed to arbitrate a certain matter
(including arbitrability), courts generally . . . should apply ordinary state-law principles
that govern the formation of contracts.” First Options of Chi., Inc. v. Kaplan, 514 U.S. 938,
944 (1995). The U.S. Supreme Court, however, has added an important qualification:
“[c]ourts should not assume that the parties agreed to arbitrate arbitrability unless there
is clear and unmistakable evidence that they did so.” Id. (quoting AT&T Techs., Inc. v.
Comm’cns Workers of Am., 475 U.S. 463, 649 (1986)).
“Under Florida’s choice-of-law rules, lex loci contractus applies in contract
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matters[.]” Prime Ins. Syndicate, Inc. v. B.J. Handley Trucking, Inc., 363 F.3d 1089, 1092
(11th Cir. 2004). “Lex loci contractus provides that the law of the jurisdiction where the
contract was executed governs interpretation of the substantive issues regarding the
contract.” Id. n.1 (quoting Lumbermens Mut. Cas. Co. v. August, 530 So. 2d 293, 295
(Fla. 1988). However, “under Florida law, courts will enforce choice-of-law provisions
unless the law of the chosen forum contravenes strong public policy.” Maxcess, Inc. v.
Lucent Techs., Inc., 433 F.3d 1337, 1347 (11th Cir. 2005) (quoting Mazzoni Farms, Inc. v. E.I.
DuPont de Nemours & Co., 761 So. 2d 306, 311 (Fla. 2000)).
In light of these principles, The New Hire Agreement, which incorporates the
Arbitration Policy, is governed by Connecticut law, as it contains a choice-of-law
provision selecting Connecticut law. (Doc. 96-5, p. 3.) Because Ms. Staten and Mr. Wright
live—and presumably accepted the PTO Offer—in New York (Doc. 96, p. 9), New York
governs their agreements.
B.
Delegation Provision
“Among other things, the parties may agree to arbitrate gateway questions of
arbitrability[,] including the enforceability, scope, applicability, and interpretation of the
arbitration agreement.” Jones v. Waffle House, Inc., No. 16-15574, 2017 WL 338110, at *3
(11th Cir. 2017) (publication pending). “An antecedent agreement of this kind is typically
referred to as a ‘delegation provision.’” Id.
“Where an arbitration agreement contains a delegation provision—committing to
the arbitrator the threshold determination of whether the agreement is enforceable—the
courts only retain jurisdiction to review a challenge to that specific provision. Parnell,
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804 F.3d at 1144. If the plaintiff raises a challenge to the contract as a whole, the federal
courts may not review his claim because it has been committed to the power of the
arbitrator. Id. at 1146. “[A]bsent a challenge to the delegation provision itself, the federal
courts must treat the delegation provision as valid . . . and must enforce it . . . , leaving
any challenge to the validity of the [a]greement as a whole for the arbitrator.” Id. at 1146–
47.
To determine whether the parties have manifested a clear and unmistakable intent
to arbitrate gateway issues, courts look to the wording of the delegation provision itself.
Waffle House, 2017 WL 338110, at *6. Here, the Arbitration Policy explicitly incorporates
the provisions of The Hartford’s arbitration process. (Doc. 96-3, p. 5; see Doc. 96-4
(“Arbitration Process”).) In turn, the Arbitration Process provides that the American
Arbitration Association’s Employment Dispute Resolution Rules (“AAA Employment
Rules”) govern issues not specifically addressed by the procedures outlined in the
Arbitration Process. (Doc. 96-4, p. 3.)
The AAA Employment Rules state that “the arbitrator shall have the power to
rule on his or her own jurisdiction, including any objections with respect to the existence,
scope[,] or validity of the arbitration agreement.” Employment Arbitration Rules and
Mediation
Procedures,
AM .
ARB.
ASS’N
17
(Nov.
1,
2009),
https://www.adr.org/sites/default/files/Employment%20Rules.pdf. The U.S. Court of
Appeals for the Eleventh Circuit has definitively held that, by incorporating AAA rules
into an agreement to arbitrate, the parties have “clearly and unmistakably agreed that the
arbitrator should decide whether the arbitration clause is valid.” Terminex Int’l v. Palmer
-7-
Case 6:16-cv-01603-RBD-KRS Document 162 Filed 08/25/17 Page 8 of 10 PageID 1108
Ranch Ltd. P’ship, 432 F.3d 1327, 1332 (11th Cir. 2005). Under both Connecticut and New
York law, this interpretation is consistent with the plain meaning of the delegation
provision in the AAA Employment Rules. 5 So in the face of such language, the Court
must give effect to the parties’ intent and compel arbitration. Waffle House,
2017 WL 3381100, at *7.
Here, The Hartford has produced evidence that four Named Plaintiffs and ten
Opt-In Plaintiffs agreed to arbitrate their FLSA claims and, in doing so, delegated to the
arbitrator the decision as to whether their arbitration agreements are valid. The
Arbitration New Hires agreed to these terms as part of the onboarding process when they
were hired. Ms. Staten and Mr. Wright also agreed to such terms by accepting the PTO
Offer. As Plaintiffs have only challenged the validity of the Arbitration Policy as a whole,
the Court must enforce the delegation provision. And because the Arbitration Policy
gives the arbitrator the power to rule on his or her jurisdiction—inclusive of any
objections concerning the validity of the arbitration agreement—this Court is without
jurisdiction to make that determination.
IV.
CONCLUSION
In compelling arbitration, the FAA requires courts to either stay or dismiss a law
suit. See Lambert v. Austin Ind., 544 F.3d 1192, 1195 (11th Cir. 2008). Given the number of
individuals in this action who must now arbitrate their claims, the Court finds that
See LaSalle Bank Nat’l Ass’n v. Nomura Asset Capital Corp., 424 F.3d 195, 206
(2d Cir. 2005) (“In interpreting a contract under New York law, words and phrases
should be given there plain meaning[.]”); Barnard v. Barnard, 570 A.2d 690, 696
(Conn. 1990) (applying the plain meaning rule under Connecticut law).
5
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administratively staying such claims and requiring these individuals to produce periodic
status reports would become unmanageable. Thus, under the circumstances, the Court
finds that dismissal without prejudice is warranted.
Accordingly, it is ORDERED AND ADJUDGED as follows:
1.
The Hartford’s Motion to Dismiss under Rule 12(b)(1) and the Federal
Arbitration Act and Incorporated Memorandum of Law (Doc. 96) is
GRANTED.
2.
The claims of Cordell Allen, Alia Clark, Chris DePierro, Jessica Leighton,
Scott Agnew, Antonia Britt, Bretton Scott Brown, Melissa Cooper, Yanique
Dixon, Michael Milton, Monica Tinsley, Jordan Watkins, Baronda Staten,
and Steven Wright are DISMISSED WITHOUT PREJUDICE. If these
individuals wish to pursue their claims, they must submit them to
arbitration consistent with the terms of the Arbitration Policy. To the extent
that any other Opt-In Plaintiffs assented to the Arbitration Policy, they must
too submit their FLSA claims to arbitration.
3.
The Clerk is DIRECTED to TERMINATE Plaintiffs Cordell Allen, Alia
Clark, Chris DePierro, and Jessica Leighton as parties to this action.
4.
Any putative opt-in plaintiffs who have assented to The Hartford’s
Arbitration Policy may not participate in this action.
DONE AND ORDERED in Chambers in Orlando, Florida, on August 25, 2017.
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Copies to:
Counsel of Record
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