Adams v. Brands, LLC

Filing 23

MEMORANDUM Opinion and Order. Signed by the Honorable Steven C. Seeger on 8/1/2022: For the reasons stated herein, Defendant's motion to dismiss is granted. [For further detail see attached order.] Notices mailed. (psm, )

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UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
LATONIA ADAMS,

)
)
Plaintiff,
)
)
v.
)
)
HOSTESS BRANDS, LLC,
)
)
Defendant.
)
____________________________________)

Case No. 21-cv-4874
Hon. Steven C. Seeger

MEMORANDUM OPINION AND ORDER
Latonia Adams, an African-American woman, spent six months working for Hostess
Brands at a bakery in Chicago. She suffered various kinds of discrimination based on her race,
and she raised the issue with her employer and the union. But her complaints went nowhere.
The union elected not to pursue arbitration.
Adams did not pursue arbitration on her own. Instead, she went straight to the federal
courthouse. The lawsuit, however, skipped a step and jumped the gun. The collective
bargaining agreement requires an employee to exhaust all of her options under the grievance
procedure before filing suit. Adams could have pursued arbitration without the union, but she
didn’t. The failure to exhaust her remedies means that the lawsuit is premature.
Hostess moved to dismiss for improper venue. For the reasons stated below, the motion
to dismiss is granted.
Background
At the motion to dismiss stage, the Court must accept as true the well-pleaded allegations
of the complaint. See Lett v. City of Chicago, 946 F.3d 398, 399 (7th Cir. 2020). The Court
“offer[s] no opinion on the ultimate merits because further development of the record may cast

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the facts in a light different from the complaint.” Savory v. Cannon, 947 F.3d 409, 412 (7th Cir.
2020).
Plaintiff Latonia Adams is an African-American woman. See Cplt., at ¶ 8(a) (Dckt.
No. 1). She worked at Defendant Hostess Brands, LLC from March through September 2019.
Id. at ¶ 8(b). She was a packer and then a machine operator. Id. at ¶ 10.
Adams alleges that she endured race discrimination in several different ways, under two
different supervisors. One supervisor required her to perform more work, and more difficult
work, than her non-black colleagues. Id. at ¶ 12(a). That supervisor falsely accused her of
eating candy while on the line, and accused her of failing to inspect the pastries. Id. at ¶ 12(b)–
(c). He didn’t allow her to talk to co-workers, unlike her non-black co-workers. Id. at ¶ 12(d).
And Adams was passed over for promotions, too. Id. at ¶¶ 13–14.
Adams changed supervisors, but the mistreatment continued. The new supervisor
deprived Adams of training necessary to perform her job. Id. at ¶ 18. Her new manager spoke in
Spanish to her co-workers, which Adams couldn’t speak. Id. at ¶ 19. The new manager also told
Adams in her evaluation that other employees were afraid of her, even though she has never had
a confrontation with a co-worker. Id. at ¶¶ 20–21.
Adams went to Human Resources a few times to complain about her mistreatment. Id. at
¶¶ 15, 23. But nothing changed. Id. at ¶ 24.
Adams responded by suing Hostess. She brings two race discrimination claims. Count I
is under section 1981, and Count II is under Title VII. Id. at Counts I–II.
Hostess moves to dismiss for lack of venue. See Def.’s Mtn. to Dismiss (Dckt. No. 9).
The gist of the argument is that Adams failed to comply with the grievance procedure of the
collective bargaining agreement, which requires arbitration.

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Legal Standard
“[A] motion to dismiss based on a contractual arbitration clause is appropriately
‘conceptualized as an objection to venue, and hence properly raised under Rule 12(b)(3).’”
Faulkenberg v. CB Tax Franchise Sys., LP, 637 F.3d 801, 807 (7th Cir. 2011) (quoting Auto.
Mechs. Local 701 Welfare & Pension Funds v. Vanguard Car Rental USA, Inc., 502 F.3d 740,
746 (7th Cir. 2007)); see Fed. R. Civ. P. 12(b)(3).
“When a defendant challenges venue, the plaintiff bears the burden of establishing that
venue is proper.” Johnson v. Creighton Univ., 114 F. Supp. 3d 688, 696 (N.D. Ill. 2015); see
also RAH Color Techs., LLC v. Quad/Graphics, Inc., 2018 WL 439210, at *1 (N.D. Ill. 2018);
Soucy v. Cap. Mgmt. Servs., L.P., 2015 WL 404632, at *5 (N.D. Ill. 2015). The burden,
however, “is low because courts resolve conflicts in the plaintiff’s favor.” RAH Color Techs.,
2018 WL 439210, at *1 (collecting cases).
A district court does not need to stay within the four corners of a complaint when
considering a challenge to venue. “When one party makes a bald claim of venue and the other
party contradicts it, a district court may look beyond the pleadings to determine whether the
chosen venue is appropriate.” Deb v. SIRVA, Inc., 832 F.3d 800, 809–10 (7th Cir. 2016); see
also Faulkenberg, 637 F.3d at 809–10. That said, a district court “generally accepts the
plaintiff’s allegations as true for purposes of the motion to dismiss, so long as the complaint
contains sufficient factual allegations to state a claim for relief that is legally sound and plausible
on its face.” See Deb, 832 F.3d at 810; see also Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Analysis
Hostess moves to dismiss for improper venue based on the terms of the collective
bargaining agreement. Hostess contends that the CBA requires employees to raise disputes

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through a grievance procedure, which includes mandatory arbitration. As Hostess sees it, this
dispute belongs in arbitration, not the federal courthouse, as contemplated by the collective
bargaining agreement. The Court agrees.
“[A] collective-bargaining agreement that clearly and unmistakably requires union
members to arbitrate . . . claims is enforceable as a matter of federal law.” 14 Penn Plaza LLC v.
Pyet, 556 U.S. 247, 274 (2009). The agreement must “explicitly state[] that an employee must
resolve his statutory as well as his contractual rights through the grievance procedure delineated
in the collective bargaining agreement.” Vega v. New Forest Home Cemetery, LLC, 856 F.3d
1130, 1134 (7th Cir. 2017). “It is neither unattainable nor unreasonable to expect parties to a
collective bargaining agreement to clearly state those statutory claims that they intend to confine
to arbitration.” Cloutier v. GoJet Airlines, LLC, 996 F.3d 426, 437 (7th Cir. 2021).
A collective bargaining agreement that requires arbitration of statutory claims must
describe the covered claims with specificity. For example, in 14 Penn Plaza, the Supreme Court
addressed a collective bargaining agreement that required union members to submit all claims of
employment discrimination to binding arbitration under the CBA’s grievance and dispute
resolution procedures. The provision covered discrimination based on race and other categories
“protected by law, including, but not limited to, claims made pursuant to Title VII of the Civil
Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act . . .
or any other similar laws, rules or regulations.” Id. at 252.
The Supreme Court confirmed that such arbitration provisions are enforceable, even
though they may limit a statutory right to bring a discrimination claim in federal court. “This
Court has required only that an agreement to arbitrate statutory antidiscrimination claims be
‘explicitly stated’ in the collective-bargaining agreement.” Id. at 258 (quoting Wright v.

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Universal Mar. Serv. Corp., 525 U.S. 70, 80 (1998)). That agreement “clearly and
unmistakably” required arbitration of the antidiscrimination claims, so it was enforceable. Id. at
260. “Congress has chosen to allow arbitration of ADEA claims. The Judiciary must respect
that choice.” Id.
The Seventh Circuit encountered an agreement on the other end of the spectrum in
Cloutier. There, the collective bargaining agreement required arbitration of “dispute[s] between
the parties arising under the terms of this Agreement.” Id. at 437. Another provision – several
sections away – required “family and medical leaves in accordance with applicable law.” Id. at
436.
The Seventh Circuit held that the arbitration provision did not cover FMLA claims. The
fact that another provision of the CBA required family and medical leave was not enough to
bring FMLA claims within the scope of the arbitration provision. “The parties could have easily
written Section 15 to say something akin to ‘Any FMLA claims must be brought pursuant to the
grievance procedure as described in Sections 24 and 25.’ They did not, and we will not now read
Section 15 to say so.” Id. at 437; see also Wright, 525 U.S. at 80 (holding that a collective
bargaining agreement did not cover ADA claims because the “arbitration clause is very general,
providing for arbitration of ‘[m]atters under dispute’”) (modification in original).
Here, Hostess and the union entered into a collective bargaining agreement that includes
a provision about workplace disputes. The agreement provides that the grievance and arbitration
procedure is the only show in town when it comes to resolving disputes. “Grievances involving
claims [from] this Article shall be filed and shall be resolved exclusively by the grievance and
arbitration procedure . . . .” See Collective Bargaining Agreement, at § 6.1(a) (Dckt. No. 10-1, at
9 of 12).

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An employee must take full advantage of the grievance procedures before filing suit in
court. “No employee may institute an action in any court or bring a procedure before any
Administrative Agency unless said employee has exhausted all procedures within the grievance
procedure, except filing with the NLRB.” Id.
The collective bargaining agreement includes an expansive definition of the term
“grievance.” Id. It includes any contractual dispute about the terms of the agreement, but it also
covers statutory claims. Id. “A grievance also includes any claim under state, local or federal
substantive law, including but not limited to claims of wrongful or unlawful discharge, claims of
harassment, retaliation, claims of unlawful treatment based upon any one or combination of
factors prohibited by applicable state, local or federal law, including but not limited to claims”
that fall within a long laundry list of statutes. Id. (emphasis added).
The ensuing list of statutes is quite extensive, spanning 14 lines of text (roughly twothirds of a page). The list expressly includes claims under Title VII and other antidiscrimination
statutes. Id. For good measure, it also covers “similar such claims under federal, state and/or
local law.” Id.
The collective bargaining agreement clearly and unmistakably covers antidiscrimination
claims. The list of covered claims expressly includes Title VII, meaning the statute involved in
Count II of the complaint at hand. That’s about as clear and unmistakable as it gets.
The list of statutes is long, but it doesn’t name every statute under the sun. The list does
not expressly mention section 1981.
The parties do not give much attention to whether the provision covers claims under
section 1981. Hostess makes a cursory argument that section 1981 is covered, citing only one

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Central District of Illinois case. See Def.’s Mem., at 4–5 (Dckt. No. 10). Adams does not
respond. See Pl.’s Resp. (Dckt. No. 13).
The Court concludes that the grievance provision covers claims under section 1981, for a
few reasons.
First, the agreement’s list of covered claims is nonexclusive. The list begins with
“including but not limited to.” Id. In fact, that phrase appears twice, to double down on
inclusiveness. Both parts of that phrase suggest that the list is not exhaustive. The “word
include does not ordinarily introduce an exhaustive list.” See Antonin Scalia & Bryan A. Garner,
Reading Law: The Interpretation of Legal Texts 132 (2012) (emphasis in original); see also id.
at 226 (“When a definitional section says that a word ‘includes’ certain things, that is usually
taken to mean that it may include other things as well.”). And “not limited to” means what it
says – the covered claims are “not limited to” the statutes in the list. In short, the list is not
exhaustive, so a failure to identify section 1981 by name does not mean that it falls outside the
reach of the provision.
Second, the agreement expressly covers “similar such claims under federal, state, and/or
local law.” Id. There is no question that a claim under section 1981 is similar to a claim under
Title VII. In fact, courts apply identical prima facie requirements for a race discrimination claim
under section 1981 and a race discrimination claim under Title VII. See, e.g., Humphries v.
CBOCS W., Inc., 474 F.3d 387, 403–04 (7th Cir. 2007) (collecting cases). The two statutes
afford the same remedies, too. Substantively, the two statutes are not just “similar” – for all
intents and purposes, they’re a match.

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The overlap means that claims under section 1981 fall within the reach of the provision.
The provision covers claims under Title VII and “similar” claims. A claim under section 1981 is
similar to a claim under Title VII. So, it’s covered.
Third, the agreement exempts certain federal laws, such as “any controversy arising
under the National Labor Relations Act, as amended.” Id. The company and the union knew
how to exclude certain statutes from the reach of the arbitration provision. And here, there is no
hint that the parties excluded claims under section 1981.
Overall, the text of the agreement “clearly and unmistakably” covers claims under Title
VII and, by extension, section 1981. See 14 Penn Plaza LLC, 556 U.S. at 274. As a result,
Adams had an obligation under the collective bargaining agreement to follow the grievance
procedure. See Collective Bargaining Agreement (Dckt. No. 10-1, at 9 of 12).
That procedure required Adams to take three steps. First, the union and supervisor must
attempt to resolve the dispute. Id. at 10 of 12. Second, if they are unable to resolve the issue, the
union must write to the employer’s representative within 10 days. Id. Third, within five days of
the written grievance, the union and the employer must meet to discuss the grievance. Id.
At that point, if the grievance remains unresolved, the grievance “may be submitted to an
arbitrator whose decision shall be final and binding on the Union, the employee(s), and the
Employer.” Id. If an employee wishes to arbitrate, the employee or the union must make the
demand within 15 days after the receipt of the decision made from the union-employer meeting.
Id. The collective bargaining agreement then drills down on the arbitration procedure, including
the names of the arbitrators, the filing fees, the timeline, and so on. Id. at 11–12 of 12.
The collective bargaining agreement imposes a blockade, preventing an employee from
going to the courthouse without trying to resolve the dispute through the grievance procedure.

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“No employee may institute an action in any court or bring a procedure before any
Administrative Agency unless said employee has exhausted all procedures within the grievance
procedure . . . .” Id. at 9–10.
Notice the key word: “all” procedures. Id. An employee must exhaust “all” procedures
within the grievance procedure framework. And the phrase “grievance procedure” harkens back
to the title of Article VI as a whole – “GRIEVANCE PROCEDURE” – which expressly covers
submitting grievances and heading to arbitration.
Adams contends that she did, in fact, exhaust those procedures, and she submits a
declaration to back up her position. See Adams Dec. (Dckt. No. 13-1). The declaration
summarized her efforts to raise her discrimination claim – first with the state agency, and then
with the union itself.
In late August 2019, Adams brought her case to the Illinois Department of Human
Rights, but the intake officer told her to go through the grievance procedure first. Id. at ¶¶ 3–4.
Adams provided the union with a written grievance “[i]n the next day or two,” which was then
filed with the company. Id. at ¶¶ 6–7. The union had a grievance meeting, which was
unresolved. Id. at ¶¶ 6–8. And the company and union decided not to proceed to arbitration. Id.
at ¶ 8.
In her declaration, Adams expressed the view that the union holds the reins on whether to
go forward with arbitration. And the employee is stuck with the union’s decision, like it or not.
“Pursuant to the collective bargaining agreement, an individual covered by the collective
bargaining agreement cannot decide to arbitrate a grievance – such decision is exclusively in the
control of the union and the company.” Id. at ¶ 9.

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As Adams tells it, she exhausted her internal remedies when the union decided not to
arbitrate her claims. Id. at ¶ 10. At that point, she hit a dead end when it came to arbitration, so
she returned to the IDHR and filed a charge of discrimination. Id. at ¶ 11; see also Charge of
Discrimination (Dckt. No. 13-2).
Adams did take a number of steps to raise her claims with the company and the union.
And she did make efforts to arbitrate her claims, until the union decided not to get on board.
Even so, the union’s decision not to arbitrate did not impose an immovable roadblock. Adams
could have pursued arbitration without the union.
The collective bargaining agreement expressly covers this very situation. The CBA
addresses what an employee should do if she “desires to proceed and the Union declines.” See
Collective Bargaining Agreement (Dckt. No. 10-1, at 11 of 12). “In the event the employee
desires to proceed and the Union declines, the employee will execute a waiver and the costs of
the Arbitration will be born entirely by the Employer.” Id.
The collective bargaining agreement allows an employee to pursue arbitration, even
without the support of the union. And it explains how to do it. The employee simply needs to
sign a waiver. And in that case, the employee does not have to pay anything. The arbitration
will get paid on the company’s dime.
Adams could have pursued arbitration without the union, but she didn’t. The failure to
arbitrate means that Adams did not “exhaust[] all procedures within the grievance procedure
. . . .” Id. at 9–10. And the failure to exhaust means that she cannot come to the federal
courthouse.

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Conclusion
For the foregoing reasons, Defendant’s motion to dismiss is granted.

Date: August 1, 2022
Steven C. Seeger
United States District Judge

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