Anderson v. AIG Life and Retirement

Filing 38

ORDER granting in part Defendant's 12 Motion to Dismiss to the extent it seeks dismissal of this action. Accordingly, Plaintiff's Complaint is DISMISSED without prejudice. The Court DENIES as moot Defendant's alternative motion for a stay of these proceedings. Plaintiff is compelled to submit his claims to arbitration. Signed by Chief Judge Lisa G. Wood on 8/8/2016. (ca)

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WILLIAM A. ANDERSON,
Plaintiff,
V

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AIG LIFE AND RETIREMENT,
Defendant.

CV 414-278

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This matter comes before the Court on a fully-briefed
Motion to Dismiss, or, in the alternative, a Motion to Stay and
Compel Arbitration filed by Defendant AIG Life and Retirement
("Defendant" or "AIG"). See Dkt Nos. 12, 13, 20, 28. For the
reasons set forth below, Defendant's Motion to Dismiss, dkt. no.
12, is GRANTED in part and otherwise DENIED AS MOOT.
Background

Plaintiff William A. Anderson began employment with AIG
sometime around July, 2003. See Dkt. No. 20 at 1; dkt. no. 13-3
at 2. On December 19, 2014, Anderson filed a Complaint against
his employer AIG alleging discrimination and retaliation in
violation of Section 1981 of the Civil Rights Act of 1866, 42
U.S.C. § 1981 ("Section 1981"), Title VII of the Civil Rights
Act of 1964, 42 U.S.C. § 2000e-5 ("Title VII"), and the
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Americans with Disabilities Act of 1990, 42 U.S.C. § 12117(a)
("ADA"). Dkt. No. 1 at 2. The Complaint contains allegations
of events taking place as early as March 2012. Id. at 3.
AIG filed a Motion to Dismiss for lack of subject matter
jurisdiction pursuant to Fed. R. Civ. P. 12(b) (1),. or, in the
alternative, to Stay and Compel Arbitration. Dkt. No. 12. To
support its motion, AIG points to an alternative dispute
resolution plan entitled "American General Employee Dispute
Resolution Plan" ("EDR plan") contained in a Sales Employee
Employment Agreement ("2003 Agreement"), dkt. no. 13-1 at 8,
which "sales employees such as Mr. Anderson would have signed,"
Declaration of Michael Herman ("Herman Decl."), dkt. no. 13 ¶ 4.
That provisions states, in pertinent part:
The sales
Alternative Dispute Resolution Plan.
employee agrees that the American General Employee
Dispute Resolution Plan, as it may be amended from
time to time, is the exclusive means for resolving
employment-related legal claims with the Company.
American General Life and Accident Insurance Company
has adopted a Dispute Resolution Plan in accordance
with the Federal Arbitration Act. The Dispute
Resolution Plan covers any matter relating to the
relationship between the Employee and the Company,
including all claims or disputes arising out of the
interpretation or enforcement of any duties, rights,
or obligations of the parties set forth in this
Agreement, all claims amounting to common law tort or
pursuant to public policy, and all claims under any
federal, state, or local human rights or employment
rights statute or wage and hour statute, including,
[Title VII, the ADA, and Section 1981, among others,]
and any similar state statute or any state retaliatory
discharge statute, whether the basis for the dispute
arises at the time of application for employment, as a
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result of termination of employment or as a
consequence of the company's attempt to enforce a
provision of this Agreement after termination of
employment.
Dkt. No. 13-1 at 8. The subsequent paragraph carves out certain
claims from the EDR plan, including workers compensation,
unemployment compensation, and certain ERISA claims. Id. at 89. It also states that AIG "in its sole discretion, may amend
or terminate the [EDR plan] at any time," Id. at 9, and that
notice of amendments or modifications would be provided by AIG
in writing, id. at 8. Finally, in exchange for the parties'
mutual agreement to submit all covered disputes to arbitration,
the parties "each expressly waive any right either may have to
seek redress in any court." Id. at 9.
The 2003 Agreement filed by AIG in support of its motion,
dkt. no. 13-1, is not signed by either AIG or Anderson. AIG has
additionally submitted a copy of "Applicant's Understandings and
Authorizations," signed by Anderson on July 14, 2003, which
contains the following provision regarding the EDR plan:
Certain [AIG] Companies have adopted Employee Dispute
Resolution ("EDR") programs, which include both
informal and formal means, including binding
arbitration, as the sole method of resolving most
employment-related disputes. Seeking or accepting
employment with [AIG], means that I agree to resolve
employment-related claims against the company or
another employee through this process instead of
through the courts. No right of court action exists.
Likewise, the company agrees to resolve these types of
disputes it may have with me through the same EDR
program rather than through court action. I am still
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free to consult or file a complaint with any
governmental agency, such as the EEOC, regarding my
legally protected rights. However, if I am not
satisfied with the results of the government agency
process, this program must be used instead of the
court system. The details of the applicable EDR
program, including any limitations or exclusions are
furnished to each employee and are available to
I agree that if I either
applicants upon request.
apply for or accept employment with American General
Life and Accident Insurance Company, all covered
claims and disputes that arise either as part of the
hiring process or during employment, if I am hired,
will be subject to the terms of the applicable EDR
program.
Dkt. No. 13-3 at 2 (emphasis in original). The EDR plan in
effect at this time, dkt. no. 13-2, provides that "[a]pplication
for employment, employment or continued employment .
constitutes consent by both the Employee and [AIG] to be bound
by this Plan." Id. at 5. The EDR plan itself is not signed by
Anderson or AIG. Id. at 6. On July 28, 2003, Anderson executed
a document entitled, "Employee Acknowledgement Concerning [AIG
EDR] Program." Dkt. No. 13-4. Therein, Anderson acknowledged
that he is "required to adhere to the [EDR] Program" and that he
understands his "employment or continued employment with .[AIG]
constitutes [his] acceptance of the terms of this provision as a
condition of [his] employment or continued employment." Id.
AIG's 2003 Agreement was revised in August 2008 and signed
by Anderson and an AIG General Manager on September 23, 2008
("2008 Agreement") . Dkt. No. 13-5 at 12; Affidavit of William
Anderson ("Anderson Aff."), Dkt. No. 20-1 ¶ 4. It contains a
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similar EDR plan provision, which incorporates documents that
comprise the EDR Program, see dkt. no. 13 ¶91 9-10, the receipt
of which Anderson acknowledged. Dkt. No. 13-5 at 11-12 ("The
Sales Employee acknowledges receipt of the documents that
comprise the [EDR plan] which are incorporated herein by
reference."). The 2008 Agreement is largely identical - to the
2003 Agreement. The notice provision was updated to reflect
that AIG is required to provide "30 days['] notice to current
employees" in the event of an amendment or termination of the
EDR plan. Id. at 12.
DISCUSSION

"The Federal Arbitration Act ("FAA") generally governs the
validity of an arbitration agreement." Waithour v. Chipio
Windshield Repair, LLC, 745 F.3d 1326, 1329 (11th Cir.), cert.
denied, 134 S. Ct. 2886 (2014). "The FAA was 'enacted in 1925
as a response to judicial hostility to arbitration.'" Id.
(quoting CompuCredit Corp. v. Greenwood, 565 U.S. --, --, 132
S.Ct. 665, 668 (2012)). "The FAA thus 'embodies a liberal
federal policy favoring arbitration agreements' and seeks 'to
relieve congestion in the courts and to provide parties with an
alternative method for dispute resolution that is speedier and
less costly than litigation.'" Id. (quoting Caley v. Gulfstream
Aerospace Corp., 428 F.3d 1359, 1367 (11th Cir. 2005)).
Consistent with the text of the FAA, "courts must 'rigorously
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enforce' arbitration agreements according to their terms." Am.
Exp. Co. v. Italian Colors Rest., -- U.S. --, --, 133 S. Ct.
2304, 2309 (2013) (quoting Dean Witter Reynolds Inc. v. Byrd,
470 U.S. 213, 221 (1985)).
The FAA's primary substantive provision provides that a
written agreement to arbitrate a controversy arising out of that
contract "shall be 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; see also Pendergast
v. Sprint Nextel Corp., 691 F.3d 1224, 1231 (11th Cir. 2012)
(explaining that arbitration agreements are on "equal footing
with other contracts"). "[A] court can decline to enforce an
arbitration agreement under the FAA only if the plaintiff[] can
point to a generally applicable principle of contract law under
which the agreement could be revoked." Caley, 428 F.3d at 1371.
State law, here Georgia law, generally governs whether an
enforceable contract exists; however, the FAA preempts state law
to the extent it treats arbitration agreements differently than
other contracts. Id. at 1367.
It is clear from the face of the Agreements, both
separately and together with the accompanying documents, that
the parties' dispute is covered by the arbitration provision.
Both the 2003 and 2008 Agreements are broad in that they cover
all disputes "regarding legally protected rights," except those
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involving workers compensation, unemployment compensation and
certain ERISA benefit claims, and both Agreements expressly
mention the claims brought by Plaintiff, i.e. Section 1981,
Title VII, and the ADA claims. Dkt. Nos. 13-1 at 8, 13-5 at 1112. Even though the 2003 Agreement is not signed, the 2008
Agreement is signed by both parties. Dkt. Nos. 13-1 at 9, 13-5
at 12. Plaintiff does not dispute that both he and AIG executed
this document, nor does he dispute that he received the EDR PLAN
documents. Thus, the Court must compel arbitration unless
Plaintiff can "point to a generally applicable principle of
contract law under which the agreement could be revoked."
Caley, 428 F.3d at 1371.
1. Significance of Lack of Signatures and/or Initials
Plaintiff argues arbitration cannot be compelled because
not all key documents were signed and/or initialed by the
parties. Despite Plaintiff and AIG's signature on the 2008
Agreement, Plaintiff argues the lack of signature and/or
initials on the 2003 Agreement and other EDR plan documents
makes them unenforceable. Dkt. No. 20 at 1-2, 4. Plaintiff
cites to O.C.G.A. § 9-9-2(c), which provides, in part:
[Part 1 of Georgia Arbitration Code] shall apply
to all disputes in which the parties thereto have
agreed in writing to arbitration and shall provide the
exclusive means by which agreements to arbitrate
disputes can be enforced, except the following, to
which this part shall not apply . .

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(9) Any contract relating to terms and
conditions of employment unless the clause agreeing to
arbitrate is initialed by all signatories at the time
of the execution of the agreement[.]
§ 9-9-2 (c) (9). The parties do not dispute that the
arbitration provision contained in the 2003 Agreement and
the 2008 Agreement is not initialed by the parties as
contemplated by § 9-9-2(c)(9). According to the statute,
then, the GeOrgia Arbitration Code does not apply to those
Agreements. That does not mean, however, that, the
Agreements are unenforceable, as Plaintiff suggests.
Rather, the Agreements are governed by the FAA, as
contemplated by the Agreements and/or the EDR plans
themselves. See 2003 Agreement, Dkt. No. 13-1 at 8 (noting
that the EDR Plan "is the exclusive means for resolving
employment-related claims . . . in accordance with the
Federal Arbitration Act"); EDR Program in effect September
2008, dkt. no. 13-6 ¶I 2, 7.A. (stating that the "Act"
shall apply to the EDR Program and defining "Act" as the
"Federal Arbitration Act"). As courts across the country,
including Georgia, have recognized, the FAA preempts state
law when the law undermines the FAA's objective of
enforcing arbitration agreements according to their terms.
See Harrison v. Eberhardt, 651 S.E.2d 826, 828 (Ga. Ct.
App. 2007) ("When an agreement expressly provides for the

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FAA to govern, the FAA preempts Georgia's requirement that
the parties initial the provision."); see also Am. Gen.
Fin. Servs. v. Jape, 732 S.E.2d 746, 748 (Ga. 2012).
Plaintiff's argument that the arbitration provisions are
unenforceable because they are not initialed by the parties
is preempted by the FAA.
2. Continued Employment as Consideration
Plaintiff argues that though "[t]he documents submitted by
AIG present several offers to [Plaintiff] and it is uncontested
that Mr. Anderson accepted employment and continued employment
with AIG," because he is an at-will employee, his continued
employment is insufficient consideration. Dkt. No. 20 at 5; see
also id. at 6. Plaintiff's "argument evidences a
misunderstanding of the concept of consideration." Jackson v.
Cintas Corp., 425 F.3d 1313, 1318 (11th Cir. 2005). "Under
Georgia law, a mutual exchange of promises constitutes adequate
consideration." Id. (citing Brown v. McGriff, 567 S.E.2d 374,
376 (Ga. Ct. App. 2002). Not only did AIG provide Plaintiff a
job as consideration for his assent to the EDR plan, but AIG
itself agreed to be bound by the same plan. See dkt. nos. 13-1
at 8-9, 13-5 at 11-12, 20-1 ¶ 4. Plaintiff's argument that the
Agreement(s) lack consideration is meritless.
3. Whether Agreement(s) are Illusory Contracts

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Plaintiff argues that "an agreement to arbitrate that can
be rescinded or modified unilaterally by the employer at any
time does not create a mutually enforceable, binding contract."
Dkt. No. 20 at 5. It follows, argues Plaintiff, that "the
provisions should be determined illusory and unenforceable." Id.
at 6. Specifically, Plaintiff states that the 2008 Agreement
allows AIG to amend it "from time to time' without a provision
for how the Plaintiff would be noticed." Id. at 11.
The illusory promises doctrine "instructs courts to avoid
constructions of contracts that would render promises illusory
because such promises cannot serve as consideration for a
contract." M & G Polymers USA,_LLC v. Tackett, -- U.S. --, 135
S. Ct. 926, 936 (2015). "It has long been the rule in Georgia
that the test of mutuality is to be applied as of the time the
contract is to be enforced." Jones v. Quigley, 315 S.E.2d 59,
60 (Ga. Ct. App. 1984). "If at that time the contract contains
mutual obligations equally binding on both parties to the
contract, then the contract is not unilateral and
unenforceable." Id.
Plaintiff's argument that AIG is imposing an illusory, onesided requirement to arbitrate, dkt. no. 20 at 4, is misguided.
The 2008 Agreement—and the 2003 Agreement, for that matter—
clearly states that both parties agree to participate in binding
arbitration and waive their right to court action. Dkt. No. 13A072A
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1 at 9 (providing for "the parties' mutual agreement to submit
to arbitration" and "waive any right either may have to seek
redress in any court"); Dkt. No. 13-5 at 12 ("Both [AIG] and the
Sales Employee are agreeing to resolve all disputes covered by
the [EDR Plan]" and "waive their right to a trial in a judicial
forum"). AIG is bound by the terms of the 2008 Agreement with
regard to covered claims, and its promise to be bound is thus
not illusory. Caley, 428 F. 3d at 1374 (citing Iberia Credit
Bureau, Inc. v. Cingular Wireless, LLC, 379 F.3d 159, 174-75
(5th Cir. 2004) ("The fact that the company has the right to
change the terms upon notice does not mean that the contract
never bound it."); Blair v. Scott Specialty Gases, 283 F.3d 595,
604 (3d Cir. 2002) (noting that promise is not illusory where
employer retained unilateral power to modify employee handbook
but was required to provide notice before doing so)). Plaintiff
acknowledges that the "Amendment of Agreement" provision states
AIG "may amend or modify any part of this Agreement at any time

by notice in writing."

Dkt. No. 20 at 11 (emphasis added). As

Defendant points out, the brochure outlining the EDR program
given to employees upon signing the revised 2008 Agreement
states that AIG may change or discontinue the EDR program only
by providing "30 days' prior notice." Dkt. No. 28 at 4 (quoting
dkt. no. 13-7 at 4); dkt. no. 13 ¶ 10.

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Plaintiff also makes other arguments that the Agreement is
illusory. First, Plaintiff argues that the Agreement provides
AIG unilateral authority to modify the terms of Plaintiff's
compensation without providing notice. See dkt. no. 20 at 7.
However, the compensation provision does not affect the parties'
rights and obligations under the arbitration provision of the
Agreement, and, therefore, does not make the Agreement illusory.
Next, Plaintiff argues that because AIG carves out a right to
pursue legal remedies to enjoin Plaintiff from violating a
covenant not to solicit and/or induce, dkt. no. 20 at 8, the
arbitration provision is rendered illusory. The Eleventh
Circuit has recognized, however, that an arbitration agreement
can carve out causes of action. See, e.g., U.S. Nutraceuticals,
LLC v. Cyanotech Corp., 769 F.3d 1308, 1313 (11th Cir. 2014);
see also Performance Unlimited v. Questar Publishers, 52 F.3d
1373, 1380 (6th Cir. 1995) (noting that "a district court has
the authority to grant injunctive relief in an arbitrable
dispute, provided that the traditional prerequisites for such
relief are satisfied" (citing cases)). Plaintiff's argument
that the EDR program is illusory fails.
4. The Scope of the Arbitration Provision
Plaintiff argues that the Applicant's Understandings and
Authorizations, dkt. no. 13-3, which he signed on July 14, 2003,
"does not set out specific employment claims and is . . . not
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specific as to the federal statutory rights that the applicant
is agreeing to arbitrate," and, therefore, it is ambiguous and
cannot be enforced against him. See Dkt. No 20 at 9-10.
Plaintiff's argument is meritless. The Understandings and
Authorizations document expressly states that "[sleeking or
accepting employment with [AIG] means that I agree to resolve
employment-related claims against the company or another
employee through this process instead of through the courts" and
that "[n]o right of court action exists."

Dkt. No. 13-3

(emphasis in original). His signature on the document
acknowledges that "[t]he details of the EDR program, including
any limitation or exclusions are furnished to each employee and
are available to applicants upon request." Id. The EDR program
itself specifically lists statutory claims, expressly including
those brought by Plaintiff in this action, and states that
disputes regarding legally protected rights are covered and must
be resolved through arbitration. Dkt. Nos. 13-1 at 8, 13-5 at
11-12. At a minimum, any confusion on Plaintiff's part as to
what claims are covered was rendered moot upon his receipt of
the EDR program document two weeks later, on July 28, 2003,
which he acknowledged via his signature. Dkt. No. 13-4.
5. Significance of At-Will Employment
Plaintiff argues that the documents submitted by AIG
"merely set forth various changes in the terms and conditions of
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[Plaintiff's] employment and should not be considered
enforceable contracts in an under at-will employment
relationship." Dkt. No. 20 at 14. In other words, it appears
Plaintiff is arguing that since the Agreements are invalid, so
are the arbitration provisions within them.
There are two types of challenges to the validity of
arbitration agreements. Buckeye Check Cashing, Inc. v.
Cardegna, 546 U.S. 440, 444 (2006). "One challenges
specifically the agreement to arbitrate," and "[t]he other
challenges the contract as a whole." Id. The former is an
issue to be addressed by the courts, and the latter is to be
addressed by an arbitrator. Id. at 445-46. Therefore, this
argument is one for the arbitrator, and not the Court, to
decide.
6. Significance of AIG's Participation in the Open Door
Policy
Plaintiff recognizes that the EDR program "provides
employees with a four-option process for resolving workplace
disputes." Dkt.

No.

20 at 12 (citing Dkt.

No.

13-7 at 2).

Under the "Open Door Policy," the employee has "the opportunity
to raise any employment-related concern with whatever level of
management in your unit or division is required to resolve the
issue. . . . Employees, supervisors and managers must honor the
integrity and spirit of the policy[.]" Dkt.

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No.

13-7 at 5.

Plaintiff argues that AIG failed to honor its obligations under
the Open Door Policy, which demonstrates that agreement to
arbitrate is illusory and unenforceable. Dkt. No. 20 at 13.
Defendant responds that the Open Door Policy option is a
voluntary step in the dispute resolution process, whereas the
arbitration step, should a dispute get that far, is mandatory.
Dkt. No. 28 at 8.
"(0)nce a court has determined that the parties have an
agreement to arbitrate, 'procedural questions which grow out of
the dispute and bear on its final disposition are presumptively
not for the judge, but for an arbitrator, to decide.'" Ga. Cas.
& Sur. Co. v. Excalibur Reinsurance Corp., 4 F. Supp. 3d 1362,
1372 (N.D. Ga. 2014) (quoting Howsam v. Dean Witter Reynolds,
Inc., 437 U.S. 79, 84 (2002)). "Procedural questions reserved
for arbitrators include questions of standing, laches, res
judicata, procedural timeliness, collateral estoppel, and
equitable estoppel." Id. (citing Aluminum Brick & Glass Workers
Int'l Union v. AAA Plumbing Pottery Corp., 991 F.2d 1545, 1550
(11th Cir..1993)). Similarly, "whether grievance procedures or
some part of them apply to a particular dispute, whether such
procedures have been followed or excused, or whether the
unexcused failure to follow them avoids the duty to arbitrate"
are procedural questions left to the arbitrator. Glass v.
Kidder Peabody & Co., 114 F.3d 446, 453 (4th Cir. 1997) (citing
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John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 557
(1964)). Accordingly, the Court finds Plaintiff's argument
regarding whether Defendant participated in the Open Door Policy
option under the EDR plan and what effect that has, if any, on
the parties' duty to arbitrate is one that should be resolved by
the arbitrator and not the Court.
The Court finds the arbitration provision of the 2008
Agreement enforceable. Because all of Plaintiff's claims are
subject to arbitration, the Court exercises its discretion to
dismiss the case without prejudice rather than stay proceedings.
Perera v. H &R Block E. Enters., Inc., 914 F. Supp. 2d 1284,
1290 (S.D. Fla. 2012) (citing Caley v. Gulfstream Aerospace
Corp., 333 F. Supp. 2d 1367, 1379 (N.D. Ga. 2004) ("The weight
of authority clearly supports dismissal of the case when all of
the issues raised in the district court must be submitted to
arbitration."), aff'd 428 F.3d at 1379).
CONCLUSION

For the reasons set forth above, Defendant's motion to
dismiss, dkt. no. 12, is GRANTED to the extent it seeks
dismissal of this action. Accordingly, Plaintiff's Complaint is
DISMISSED WITHOUT PREJUDICE.

The Court DENIES AS MOOT

Defendant's alternative motion for a stay of these proceedings.
Plaintiff is compelled to submit his claims to arbitration.

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SO ORDERED, this 8TH day of August, 2016.

LISA GODBEY W OD, CHIEF JUDGE
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA

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