Stephens v. Charter Communications Holdings, LLC
Filing
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MEMORANDUM OPINION AND ORDER Signed by Chief Judge Joseph H. McKinley, Jr. on 9/26/2017: Plaintiff Charles Stephens motion 7 to remand is DENIED, and defendant Charter Communications Holdings, LLC's motion 8 to compel arbitration is GRANTED. The case is DISMISSED without prejudice. cc: Counsel (JBM)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
LOUISVILLE DIVISION
CIVIL ACTION NO. 3:17-CV-00354-JHM
CHARLES STEPHENS
PLAINTIFF
V.
CHARTER COMMUNICATIONS
HOLDINGS, LLC
DEFENDANT
MEMORANDUM OPINION AND ORDER
This matter is before the Court on plaintiff Charles Stephens’ motion to remand (DN 7),
as well as defendant Charter Communications Holdings, LLC’s (“Charter”) motion to compel
arbitration. (DN 8.) These matters are ripe for decision.
I. BACKGROUND
According to the complaint, Plaintiff Stephens was employed by Charter as a customer
service representative. (Pl.’s Compl. [DN 1-2] ¶ 6.)
While employed, Stephens disclosed to
Charter that he suffered from a neurological disorder, and he sought “medical accommodations
from [Charter] in the form of leave to convalesce.”
(Id. ¶ 7.)
Stephens’ request for
accommodation was denied, and he was terminated in retaliation for reporting the discrimination
to management. (Id. ¶ 9–10.) He brought the present action against Charter in Jefferson Circuit
Court, asserting claims of discrimination and retaliatory discharge under the Kentucky Civil
Rights Act, KRS Chapter 344 et seq. (Id. ¶ 11–14.) Charter removed to this Court (DN 1), and
Stephens has moved to remand the case to state court on the basis that the amount in controversy
is less than the $75,000 threshold required to meet this Court’s jurisdictional requirement for
diversity cases. (DN 7.) In support of this argument, Stephens submitted a stipulation through
his counsel that he “will not seek a judgment or request a verdict for an amount in excess of
$74,999.00[.]” (DN 7-1.) In addition to opposing the motion to remand (DN 9), Charter has
moved this Court to compel Stephens to arbitrate his claims in accordance with an arbitration
agreement he signed when beginning his employment with Charter. (DN 8.) Stephens has not
responded to this motion, and the time for such response has now passed.
II. DISCUSSION
A. MOTION TO REMAND
1. STANDARD OF REVIEW
Removal from state to federal court is proper for “any civil action brought in a State court
of which the district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a).
Charter removed this action pursuant to 28 U.S.C. § 1441, claiming that this Court has diversity
jurisdiction over the action under 28 U.S.C. § 1332. Diversity jurisdiction gives “[t]he district
courts . . . original jurisdiction [over] all civil actions where the matter in controversy exceeds
the sum or value of $75,000, exclusive of interest and costs, and is between . . . citizens of
different states.” 28 U.S.C. § 1332(a), (a)(1).
2. ANALYSIS
It is undisputed that the parties are diverse and that Stephens has stipulated that the
amount in controversy does not exceed $75,000. Therefore, the principal issue is whether this
stipulation is sufficient for the Court to remand Stephens’ action to Jefferson Circuit Court.
Courts within the Sixth Circuit have “noted on several recent occasions that postremoval
stipulations reducing the amount in controversy below the jurisdictional threshold are generally
disfavored because” if plaintiffs “were able to defeat jurisdiction by way of a post-removal
stipulation, they could unfairly manipulate proceedings merely because their federal case begins
to look unfavorable.” Gatlin v. Shoe Show, Inc., 2014 WL 3586498, at *3 (W.D. Ky. July 21,
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2014) (citations and quotations omitted); see Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 872
(6th Cir. 2000); Agri-Power, Inc. v. Majestic JC, LLC, 2013 WL 3280244, at *3 (W.D. Ky. June
27, 2013); Proctor v. Swifty Oil Co., 2012 WL 4593409, at *3 (W.D. Ky. Oct. 1, 2012). The
Sixth Circuit has advised that “a post-removal stipulation reducing the amount in controversy to
below the jurisdictional limit does not require remand to state court.” Rogers, 230 F.3d at 872.
“However, where a state prevents a plaintiff from pleading a specific amount of damages,” as
Kentucky does, “and the plaintiff provides specific information about the amount in controversy
for the first time in a stipulation, this district views such stipulations as a clarification of the
amount in controversy rather than a reduction of such.” Agri-Power, 2013 WL 3280244, at *3
(citing Proctor, 2012 WL 4593409, at *3) (emphasis in original). Therefore, a plaintiff may
submit a stipulation that will destroy the amount in controversy requirement for the purposes of
diversity jurisdiction under 28 U.S.C. § 1332. Id.
When a plaintiff chooses to submit a stipulation as to the amount in controversy, the
stipulation must be unequivocal in order to “limit the amount of recoverable damages and
warrant remand.” Egan v. Premier Scales & Sys., 237 F. Supp. 2d 774, 778 (W.D. Ky. 2002); see
Agri-Power, 2013 WL 3280244, at *3; Proctor, 2012 WL 4593409, at *3. This district “has
recognized that a plaintiff may stipulate that it neither seeks, nor will accept, damages in an
amount greater than $75,000, and that such a stipulation will” be sufficiently unequivocal to
destroy diversity jurisdiction. Agri-Power, 2013 WL 3280244, at *3 (emphasis added).
Stephens’ stipulation in this case does not meet this standard. It states that he “will not
seek a judgment or request a verdict for an amount in excess of $74,999.00 and will not seek
attorney’s fees for any amount that, together with any judgment or verdict, would exceed
$74,999.” (DN 7-1.) While Stephens stipulates that he will not seek a verdict of $75,000 or
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more, he does not stipulate that he will not accept or seek to enforce a judgment of that amount.
The stipulation is “less than unequivocal” and thus deficient to defeat removal. Accord Egan,
237 F. Supp. 2d at 778 (denying motion to remand as stipulation did not effectively limit the
judgment). Compare with Leavell v. Cabela’s Wholesale, Inc., 2015 WL 9009009, at *2–3
(W.D. Ky. Dec. 15, 2015) (Court lacked jurisdiction when plaintiff stipulated that she “will
neither seek nor accept damages in excess of $75,000”). Because the stipulation does not
effectively limit the amount in controversy to a sum below $75,000, and there being no other
challenge to the amount in controversy, this Court possesses subject matter jurisdiction over the
case. Therefore, the motion to remand is DENIED.
B. MOTION TO COMPEL ARBITRATION
Charter argues that Stephens’ is bound by an arbitration agreement he electronically
signed before beginning his employment.
This agreement, entitled “Mutual Agreement to
Arbitrate,” states that,
By accepting employment with Time Warner Cable,1 you and
Time Warner Cable (“TWC,” as defined below) agree that any and
all claims, disputes, and/or controversies between you and TWC
arising from or related to your employment with TWC shall be
submitted exclusively to and determined exclusively by binding
arbitration before a single Judicial Arbitration and Mediations
Services, Inc. (“JAMS”) arbitrator under the Federal Arbitration
Act, 9 U.S.C. § 1 et seq. (“FAA”) . . . includ[ing] . . . claims . . .
under state labor laws . . . [or] under any other state law related to
your employment with TWC . . .
(Arbitration Agreement [DN 8-2] at 4.) Charter has provided documentation showing that
Stephens electronically consented to the arbitration agreement on November 19, 2015, at 1:39
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Time Warner Cable has since been acquired by Charter. (Dec. Chance Cassidy [DN 8-2] ¶ 2.) The arbitration
agreement covers disputes with Time Warner Cable and its “successors and assigns.” (Arbitration Agreement [DN
8-2] at 4.)
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p.m. (Personal Information Documents [DN 8-2] at 9.) Stephens has not responded to the
motion to arbitrate or opposed it in any other manner.
The arbitration agreement provides that the FAA, 9 U.S.C. §§ 1–16, shall govern the
agreement. “When asked by a party to compel arbitration under a contract, a federal court must
determine whether the parties agreed to arbitrate the dispute at issue.” Stout v. J.D. Byrider, 228
F.3d 709, 714 (6th Cir. 2000) (citing Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc.,
473 U.S. 614, 626 (1985)). Specifically,
[w]hen considering a motion to stay proceedings and compel
arbitration under the Act, a court has four tasks: first, it must
determine whether the parties agreed to arbitrate; second, it must
determine the scope of that agreement; third, if federal statutory
claims are asserted, it must consider whether Congress intended
those claims to be nonarbitrable; and fourth, if the court concludes
that some, but not all, of the claims in the action are subject to
arbitration, it must determine whether to stay the remainder of the
proceedings pending arbitration.
Stout, 228 F.3d at 714 (citing Compuserve, Inc. v. Vigny Int'l Fin., Ltd., 760 F. Supp. 1273, 1278
(S.D. Ohio 1990)); see also N. Fork Collieries LLC v. Hall, 322 S.W.3d 98, 102 (Ky. 2010)
(“The task of the trial court confronted with” a motion to compel arbitration “is simply to decide
under ordinary contract law whether the asserted arbitration agreement actually exists between
the parties and, if so, whether it applies to the claim raised in the complaint. If an arbitration
agreement is applicable, the motion to compel arbitration should be granted”) (citations omitted).
Here, the record indicates that Charter and Stephens entered into a binding arbitration
agreement that is valid and enforceable. Further, Stephens’ claims are for discrimination and
retaliatory discharge under the Kentucky Civil Rights Act, which would qualify as claims under
state labor laws or other state laws related to employment. Such claims are covered by the
arbitration agreement. There are no federal claims asserted that could possibly be nonarbitrable,
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nor are only some of the state-law claims subject to arbitration. Therefore, the Court will enforce
the arbitration agreement.
Charter asks the Court to dismiss the case, rather than stay proceedings, in the event that
the arbitration agreement is enforced. “The FAA requires a court to stay proceedings pending
arbitration ‘only on application of one of the parties.’” Hilton v. Midland Funding, LLC, 687 F.
App’x 515 (6th Cir. 2017) (citing 9 U.S.C. § 3). Neither party has requested a stay,2 making
dismissal appropriate. Id. Therefore, Charter’s motion to compel arbitration is GRANTED, and
Stephens’ claims will be DISMISSED without prejudice. Id. (dismissal without prejudice is
appropriate to allow parties to refile or reopen case for entry of arbitration award or any other
relief to which parties may be entitled).
III. CONCLUSION
For the reasons set forth above, IT IS HEREBY ORDERED that plaintiff Charles
Stephens’ motion to remand is DENIED, and defendant Charter Communications Holdings,
LLC’s motion to compel arbitration is GRANTED. The case is DISMISSED without prejudice.
September 26, 2017
cc: counsel of record
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Charter does request a stay of proceedings, but only in the event that the Court determines that dismissal is
inappropriate. Because Charters’ clear request is for dismissal, the Court need not reach its alternative request. See
Hilton, 687 F. App’x at 515 (“Neither party did more than vaguely reference the possibility of staying the
proceedings,” making dismissal appropriate).
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