First Tower Loan, LLC et al v. Broussard

Filing 24

ORDER AND REASONS: ORDERED that Defendant's Motion to Compel Arbitration, Appoint Arbitrator and to Stay Proceedings (Rec. Doc. 85 filed in CA 15-1161) is GRANTED. FURTHER ORDERED that the Court appoints the American Arbitration Association a s the arbitral forum to administer arbitration of the dispute between Broussard and Tower. FURTHER ORDERED that Defendant's Motion to Stay EEOC Claims Pending Arbitration (Rec. Doc. 96 in CA 15-1161) is GRANTED. FURTHER ORDERED that all proce edings in this matter shall be STAYED pending the outcome of the arbitration between Broussard and Tower. The Clerk of Court shall mark this action closed for statistical purposes. FURTHER ORDERED that the Court shall retain jurisdiction and that t he case shall be restored to the trial docket upon motion of a party if circumstances change, so that it may proceed to final disposition. This order shall not prejudice the rights of the parties to this litigation. Signed by Judge Carl Barbier on 12/9/15.(sek)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

TRISTAN BROUSSARD

CIVIL ACTION

VERSUS

NO: 15-1161
c/w 15-2500

FIRST TOWER LOAN, LLC

SECTION: “J”(1)
ORDER & REASONS

Before the Court is a Motion to Compel Arbitration, Appoint
Arbitrator

and

to

Stay

Proceedings

(Rec.

Doc.

85)

filed

by

Defendant, First Tower Loan, LLC (“Tower”); an opposition thereto
(Rec.

Doc.

99)

filed

by

Intervenor,

the

United

States

Equal

Employment Opportunity Commission (“EEOC”); an opposition (Rec.
Doc. 102) filed by Plaintiff, Tristan Broussard (“Broussard”); and
Defendant’s

reply

(Rec.

Doc.

107).

Also

before

the

Court

is

Defendant’s Motion to Stay EEOC Claims Pending Arbitration (Rec.
Doc. 96), the EEOC’s opposition (Rec. Doc. 100), Plaintiff’s
opposition (Rec. Doc. 103), and Defendant’s reply (Rec. Doc. 110).
Having considered the motion and legal memoranda, the record, and
the applicable law, the Court finds that the motions should be
GRANTED for the reasons set forth more fully below.
FACTS AND PROCEDURAL BACKGROUND
This

litigation

derives

from

Broussard’s

employment

with

Tower and subsequent termination. Broussard is a twenty-one-yearold resident of Lake Charles, Louisiana. (Rec. Doc. 1 at 2.) Tower

is a consumer loan company, headquartered in Mississippi, with
branches in five states, including Louisiana. Id. at 3. Broussard
is a transgender man, meaning he outwardly appears to be male and
his gender identity is male. Id. at 4. However, his birth sex is
female. Id.
In early February 2013, Broussard applied for a job as a
Manager Trainee in Tower’s Lake Charles office. Id. at 1. Leah
Sparks, the manager of Tower’s Lake Charles office, interviewed
Broussard for the position on February 25, 2013. Id. at 4. Later
that same day, Sparks called Broussard to offer him the position.
Id. Broussard accepted the position and began working for Tower on
March 4, 2013. Id.
When Broussard arrived for his first day of work, Sparks
presented him with the paperwork required to be completed by new
employees. These materials included Tower’s Employment Agreement,
which contains the following arbitration provision: “Except for
the injunctive relief authorized by the foregoing paragraph, 1 all
other disputes, legal or otherwise, relating to the employment
relationship shall be submitted to binding arbitration by the

1 Paragraph 4 of the Employment Agreement permits Tower to seek injunctive
relief in the Chancery Court of Rankin County, Mississippi: “Upon actual or
threatened breach of this Agreement, Tower shall be entitled to a temporary
restraining order, preliminary injunction, and permanent injunction restraining
and prohibiting any conduct prohibited by this Agreement. . . . The parties
agree that the Chancery Court of Rankin County, Mississippi, shall have personal
jurisdiction over the parties for enforcement of this agreement . . . . The
parties further agree that the venue for purposes of obtaining an injunction is
Rankin County Chancery Court, such venue is mandatory, and to the exclusion of
all other venues in Mississippi or elsewhere.” (Rec. Doc. 85-2, at 4.)

2

parties.” (Rec. Doc. 85-2, at 4) (emphasis added). The Employment
Agreement also states, “Signature by the employee on this contract
constitutes an offer of employment by the employer, which offer is
not accepted, and neither an employment relationship nor contract
is formed or consummated until Tower signs this contract at its
corporate

headquarters

in

Rankin

County,

Mississippi.”

Id.

Broussard signed the Employment Agreement in Sparks’s presence on
March 4, 2013. Id.
In

addition,

the

paperwork

included

a

separate

document

extending an offer of employment to Broussard “(Acceptance Form”),
which Sparks signed on behalf of Tower. Id. at 3. The Acceptance
Form states, “We are pleased to make you an offer of employment.
. . . Please indicate your acceptance of our offer by signing your
name at the bottom of this page.” Id. Further, it provides that
“[t]he terms of your employment offer are governed by the terms
outlined in the employment agreement you will sign.” Id. Broussard
signed the Acceptance Form in Sparks’s presence on March 4, 2013.
Id.

Sparks

then

forwarded

Broussard’s

paperwork

to

Tower’s

headquarters in Mississippi. Id. at 2. Tower received Broussard’s
Employment

Agreement

and

other

new-hire

materials

at

its

headquarters on March 7, 2013, and stamped them as “received” with
that date. (Rec. Doc. 85-3, at 2.)
Tower also required Broussard to provide a valid form of
identification.

(Rec.

Doc.

1,

at
3

5.)

Broussard

provided

his

driver’s license. Id. As Broussard completed the paperwork for his
employment with Tower, Sparks noticed that his driver’s license
listed his sex as female. Id. at 5. When Sparks asked Broussard
about the listed sex, he explained that he is a transgender man.
Id.
On March 11, 2013, Tower Loan Vice President David Morgan
visited the Lake Charles office. Id. at 6. Morgan gave Broussard
a copy of the company’s dress code for female employees and
informed Broussard that the company would require him to dress as
female.

Id.

Morgan

also

presented

Broussard

with

a

written

statement and told him that he must sign the statement in order to
continue working at Tower. Id. at 7. The statement expressed that
Broussard’s “preference to act and dress as male” was not “in
compliance with Tower Loan’s personnel policies.” Id. Further, the
statement indicated that when an overnight room is required for
out-of-town meetings, Broussard would be assigned to a room with
a female. Id. Broussard refused to sign the statement, and his
employment terminated. 2 Id.
After

Broussard’s

new-hire

paperwork

arrived

at

Tower’s

headquarters on March 7, 2013, it was processed in the regular
course

of

business.

(Rec.

Doc.

85-3,

at

2.)

The

Employment

2
The parties dispute whether Tower affirmatively terminated Broussard’s
employment or Broussard resigned. However, this dispute is immaterial. Whether
Broussard was fired, quit, or was constructively discharged has no bearing on
the motions presently before the Court.

4

Agreement and other forms were reviewed by administrative staff
for completeness and were thereafter presented to J. Lynne Card,
Tower’s Vice President and Director of Human Resources, for her
signature on behalf of Tower. Id. Card reviewed Broussard’s file
and signed the Employment Agreement no later than March 26, 2013. 3
Broussard filed a charge of discrimination with the EEOC on
August 27, 2013. (Rec. Doc. 1, at 8.) The EEOC determined that
Broussard’s claim was meritorious and issued a Notice of Right to
Sue on January 20, 2015. Id. at 8-9. Broussard filed the instant
action on April 13, 2015, asserting claims against Tower for
discrimination on the basis of sex in violation of Title VII of
the Civil Rights Act of 1964 (“Title VII”), 42 U.S.C. § 2000e, et
seq. (Rec. Doc. 1, at 9.) In response, on April 23, 2015, Tower
filed suit against Broussard in the Chancery Court of Rankin
County, Mississippi, seeking to compel Broussard to arbitrate the
claims asserted in his action against Tower. (No. 15-2500, Rec.
Doc. 1.) On May 26, 2015, Broussard removed Tower’s suit to the
United

States

District

Court

for

the

Southern

District

of

3 Card determined that she signed the Employment Agreement no later than March
26 based on the data reflected in Tower’s electronic business record. (Rec.
Doc. 85-3, at 3.) Specifically, Tower’s payroll data system reflects that
Broussard’s employment was entered as “Approved,” and a date notation for this
data filed indicates that the form was last updated on March 26, 2013. Id.
However, based on the regular flow of new-hire paperwork in the office, and
given that March 26 was a Tuesday, Card believes that she signed Broussard’s
Employment Agreement on either Monday, March 25, or Friday, March 22. Id. The
exact date that Card signed the agreement is immaterial. Whether Card signed
agreement on March 22, March 25, or March 26 has no bearing on the motions
presently before the Court.

5

Mississippi. Id. Upon Broussard’s motion, on July 7, 2015, the
Southern District of Mississippi transferred Tower’s suit to this
Court, where it was consolidated with Broussard’s case. (No. 152500, Rec. Doc. 18.) Thereafter, on September 8, 2015, the EEOC
filed a motion to intervene, which the Court granted. (Rec. Doc.
70.)
Tower filed the instant Motion to Compel Arbitration, Appoint
Arbitrator and to Stay Proceedings (Rec. Doc. 85) on November 5,
2015, and Motion to Stay EEOC Claims Pending Arbitration (Rec.
Doc. 96) on November 16, 2015. The EEOC and Broussard filed their
oppositions on November 24, 2015. With leave granted from the
Court, Tower filed a reply in support of its motion to compel
arbitration on December 2, 2015, and a reply in support of its
motion to stay on December 3, 2015. The motions are before the
Court on the briefs, without oral argument.
PARTIES’ ARGUMENTS
A.

Motion to Compel Arbitration
Tower contends that all of the Title VII claims asserted in

Broussard’s complaint are subject to and within the scope of a
mandatory

arbitration

agreement

between

Broussard

and

Tower.

First, Tower argues that a valid arbitration agreement exists
within the Employment Agreement signed by both parties. (Rec. Doc.
85-1, at 5-6.) As Tower points out, the Agreement makes clear that
Broussard’s signature on the document constituted an “offer of
6

employment by the employee.” Id. at 7. Because the Agreement did
not contain an expiration date, Tower claims it was a revocable
offer. Id. at 8. Tower maintains that it accepted the offer in a
reasonable amount of time, and therefore the agreement to arbitrate
became effective when Card signed the Agreement on its behalf. Id.
Next, Tower argues that Broussard’s termination does not
constitute a revocation or rejection of the offer. Id. at 8-9.
According to Tower, termination of employment merely signifies an
end to the employment relationship that is governed by the terms
of the Employment Agreement. Id. at 8. Moreover, Tower claims that
termination of Broussard’s employment is irrelevant. Id. at 10.
Because the Agreement plainly covers disputes regarding allegation
of wrongful discharge, which cannot be alleged where an employee
is

still

employed,

Tower

insists

that

the

Agreement

clearly

contemplates that the arbitration provision will survive potential
termination. Id. at 11.
Tower further submits that Broussard would be bound to the
arbitration provision even if Tower had never signed the Agreement.
Id. at 9. Tower claims that “under Louisiana law, where one party
drafts and presents a contract and the other party signs it, the
contract is valid and binding upon the signing party, even where
the other party fails to sign the contract.” Id. Additionally,
Tower argues that because Broussard accepted the benefits of the

7

Agreement, the ability to begin employment with Tower, he is bound
by all of the terms of the Agreement. Id.
In addition, Tower contends that the Acceptance Form, by which
Tower offered and Broussard accepted Tower’s offer of employment,
constitutes a valid agreement to arbitrate, irrespective of the
timing of when Tower eventually signed the Employment Agreement.
Id. at 10. Tower asserts that the Acceptance Form incorporated the
terms of the Employment Agreement by reference, including the
arbitration provision. Id. For this reason, Tower argues Broussard
independently agreed to arbitrate all employment disputes based on
his signature on the Acceptance Form. Id.
Next, Tower asserts that Broussard’s claims fall within the
scope

of

the

arbitration

provision,

which

requires

that

any

employment-related disputes be subject to arbitration. Id. at 16.
According to Tower, the “any dispute” language in an arbitration
clause is permissible and, as is the case here, can encompass Title
VII claims in the context of an employment dispute. Id. at 17.
Moreover, because the arbitration clause is broad, Tower argues
that any dispute regarding whether Broussard’s claims fall within
the scope of the arbitration clause should be resolved by the
arbitrator. Id.
Lastly,

because

Tower’s

efforts

to

reach

agreement

with

Broussard’s counsel on an arbitrator have been unsuccessful, Tower
requests

that

the

Court

appoint
8

the

American

Arbitration

Association (“AAA”) to conduct the arbitration pursuant to its
protocol for resolution of employment disputes. Tower explains
that the AAA has a process by which the parties can select a wellqualified employment law arbitrator from among a panel randomly
proposed by the AAA. Id. at 20.
Broussard presents several arguments in opposition to Tower’s
motion.

(Rec.

Doc.

102.)

First,

Broussard

argues

that

Tower

rejected his “offer of employment” on March 11, 2013, when it fired
him. Id. at 1. Broussard maintains that Tower could not later
revive that offer by signing the Employment Agreement. Id. at 2.
Second, because Tower fired him, Broussard claims no consideration
to

create

a

binding

agreement

existed

when

Tower

signed

the

Employment Agreement. Id. Third, Broussard argues that the express
terms

of

the

Agreement,

which

provide

that

no

“employment

relationship” existed unless and until Tower signed the Agreement,
preclude arbitration of any events that occurred prior to March
22, 2013. Id. Fourth, Broussard asserts that Tower’s insistence
that he agree to present himself as a female at work constituted
a counteroffer to the Employment Agreement, which he promptly
rejected. Id. Fifth, Broussard contends that Tower waived any
present right to force arbitration because of its “aggressive
litigation” of this case. Id. In addition, Broussard insists that
the

Acceptance

Form

does

not

create

a

binding

contract

to

arbitrate. Id. at 16. If the Acceptance Form incorporates the terms
9

of the Employment Agreement, Broussard argues it would necessarily
incorporate

the

term

specifying

that

the

proposed

employment

agreement constituted an offer of employment by Broussard that was
not

accepted

until

signed

by

Tower’s

representative

at

its

corporate headquarters. Id. at 16-17.
Similar to Broussard, the EEOC presents several arguments in
opposition to Tower’s motion. (Rec. Doc. 99.) As an initial matter,
the EEOC claims that the Court must treat Tower’s motion to compel
as

a

motion

for

summary

judgment,

thereby

construing

all

ambiguities in the facts in the light most favorable to Broussard
and the EEOC. Id. at 2 nn.3-4. Many of the EEOC’s arguments
concerning the formation of an arbitration agreement are analogous
to Broussard’s arguments discussed above; however, the EEOC raises
two additional arguments. First, the EEOC contends that even if
there had been a contract, Tower has not established that Broussard
knowingly and voluntarily waived his right to a trial by jury. Id.
at 11-16. Although the Fifth Circuit has never expressly decided
the issue, the EEOC argues that Tower bears the burden of showing
that a voluntary and knowing waiver occurred. Id. at 13 & n.11.
Second, the EEOC argues that the arbitration provision at issue
violates section 707 of Title VII because it purports to foreclose
the filing of an EEOC charge. Id. at 16-18. For this reason, the
EEOC claims the contract would be unenforceable as against public
policy. Id. at 18.
10

In response, Tower claims that Broussard’s arguments have no
merit for several reasons. (Rec. Doc. 107.)

First, Tower argues

that the EEOC’s claim that the motion before the Court is a type
of

motion

for

summary

judgment

is

incorrect.

Id.

at

2

n.2.

According to Tower, disputes of fact here are not automatically
resolved in favor of the nonmoving party, but instead are to be
resolved by the Court based on the evidence. Id. Second, Tower
claims that Broussard offers no evidence that it rejected the
Employment Agreement. Id. at 3. To contrary, Tower repeats that it
is

undisputed

Furthermore,

that

Tower

it

signed

maintains

the
that

Employment
termination

Agreement.
of

Id.

Broussard’s

employment is not inconsistent with and does not constitute a
rejection

of

the

Employment

Agreement

as

to

that

period

of

employment that had already taken place as of the date it was
signed by Tower. Id. Similarly, Tower claims that there is no
evidence that Broussard withdrew his offer before it was accepted
by Tower and nothing in the Agreement imposed a deadline for Tower
to sign it. Id.
Further, Tower contests the argument that the memorandum
presented to Broussard concerning the dress code and lodging issues
was a counteroffer. Id. at 4. According to Tower, the memorandum
“did not seek to start a new employment relationship, but instead
clarified the terms and conditions of continued at-will employment
which Broussard declined.” Id. Next, Tower explains that Louisiana
11

law does not require “consideration,” but instead looks to whether
there is a lawful “cause” to support the existence of the contract.
Id. at 5. Tower maintains that proceeding with an employment
relationship was indisputably a lawful cause sufficient to support
a valid employment-related agreement. Id. Further, Tower notes
that Broussard did in fact commence employment with the company as
contemplated, such that this cause was not illusory. Id.
Tower also contends that Broussard fails to avoid the binding
effects of the Acceptance Form, a separate agreement that was
executed

by

the

parties

prior

to

the

start

of

Broussard’s

employment with the company. Id. at 5. Moreover, Tower responds
that Broussard’s argument that incorporation of the arbitration
provision by reference into the Acceptance Form included the
requirement that the Employment Agreement be signed by Tower
ignores the fact that the Agreement was in fact signed by Tower.
Id.
Next, Tower asserts that the Fifth Circuit has expressly
rejected the EEOC’s argument that requiring a plaintiff to submit
claims to arbitration violates the plaintiff’s Seventh Amendment
right to a trial by jury. Id. at 9. According to Tower, Broussard
voluntarily agreed to submit claims against Tower to arbitration
by

signing

the

Employment

Agreement

containing

the

valid

arbitration provision and, by doing so, he relinquished his right
to demand that his claims be heard by a jury. Id. In response to
12

the EEOC’s argument that the Agreement is void under Title VII
because it did not expressly reserve Broussard’s right to file an
EEOC charge, Tower argues that the EEOC fails to cite any authority
for this assertion. Id. at 10. Moreover, Tower insists that it
never

attempted

such

a

waiver

in

the

Employment

Agreement,

Acceptance Form, or otherwise. Id. To the contrary, Tower points
out it is undisputed that an EEOC charge was filed on Broussard’s
behalf and fully processed by the EEOC. Id.
Lastly, Tower rejects Broussard’s argument that it waived the
right to compel arbitration. Id. at 6. According to Tower, there
is a presumption against waiver of arbitration and Broussard bears
the heavy burden of proving that Tower waiver its right. Id.
Furthermore, Tower claims it asserted its right to arbitration in
its Answer to the Complaint and has at all times expressed to
counsel for Broussard and the EEOC that it considered Broussard’s
claims to be subject to arbitration. Id. at 7. Additionally, Tower
points

out

that

the

purpose

of

the

state

court

action

in

Mississippi was solely to compel Broussard to arbitrate the claims
he seeks to assert in this action. Id.
B.

Motion to Stay Pending Arbitration
In its second motion, Tower moves the Court to stay the claims

asserted by the EEOC in this case pending the final outcome of the
anticipated arbitration of Broussard’s claims. (Rec. Doc. 96-1, at
1-2.)

First,

Tower

contends

that
13

section

3

of

the

Federal

Arbitration Act mandates a stay of the EEOC’s action in the present
case. Id. at 6. Although the EEOC is not a signatory to an
arbitration agreement with Tower, Tower argues that “exceptional
circumstances”

exist

to

support

a

mandatory

stay.

Id.

at

7.

According to Tower, the claims asserted by the EEOC are identical
to the claims subject to arbitration asserted by Broussard. Id.
Because the issues to be litigated by the EEOC are identical to
the issues that will likely be arbitrated in Broussard’s case,
Tower claims “allowing the litigation to proceed would harm the
parties’ rights to arbitrate.” Id.
Further,

Tower

identifies

three

factors

present

in

the

instant case that warrant a stay of the EEOC’s claims. Id. First,
Tower maintains that the EEOC’s claims and the underlying facts
supporting their claims are identical to Broussard’s claims. Id.
at 7-8. Second, Tower argues that Broussard’s claims are inherently
inseparable from the claims of the EEOC. Id. at 8. Third, Tower
asserts that litigation of the EEOC’s claims will have a “critical
impact” on the anticipated arbitration. Id. For these reasons,
Tower insists that a stay of the litigation is required in this
case.
Finally, Tower contends that, even if a stay is not mandatory
under the Federal Arbitration Act, the Court has the discretion to
stay proceedings between Tower and the EEOC pending the outcome of
arbitration of Broussard’s claims. Id. In deciding whether to
14

exercise its discretion to stay the case, Tower claims that the
Court should consider whether there is an overlap of facts and
claims of the litigation and the arbitration and the likely impact
of

the

litigation

on

arbitration.

Id.

According

to

Tower,

Broussard’s anticipated arbitration necessarily overlaps with the
litigation of the EEOC’s claims because the EEOC seeks to recovery
identical, victim-specific relief on behalf of Broussard. Id. at
9. As a result, Tower claims the discovery that may take place in
the arbitration is likely to be the same or similar discovery that
will take place in the litigation of the EEOC’s claims. Id.
Moreover,

Tower

contends

that

the

resolution

of

Broussard’s

victim-specific claims by an arbitrator will serve as res judicata
barring the EEOC from seeking the same individual, victim specific
relief in a subsequent proceeding. Id. at 10. Consequently, Tower
argues that the only claims left for the EEOC to pursue would be
claims for general injunctive relief, which can only be decided by
the Court rather than a jury. Id. at 11. In sum, Tower maintains
that the Court should exercise its discretion and grant a stay as
a mean of controlling and managing its docket.
The EEOC opposes Tower’s motion for three reasons. 4 (Rec. Doc.
100, at 2-3.) First, the EEOC claims that a stay would thwart its
authority to enforce Title VII in the public’s interest. Id.

4 Broussard presents arguments in opposition to Tower’s motion to stay that are
substantially similar to the EEOC’s and do not warrant separate discussion.
(See Rec. Doc. 103.)

15

Although the EEOC seeks to enforce Title VII by intervening rather
than by bringing a direct action, it insists that it acts “to
vindicate

the

discrimination.”

public
Id.

interest

The

EEOC

in

preventing

maintains

that

employment
staying

the

litigation of its claims would severely hamper its public interest
role in this litigation. Id. at 10. Second, the EEOC contends that
the Federal Arbitration Act provides no authority to stay its
claims because it is not a party to the purported arbitration
agreement. Id. at 3. Third, the EEOC argues that the Court’s
discretionary power to control and manage its docket is better
served by moving forward with litigation of the EEOC’s claims
because

the

Court

can

directly

manage

the

litigation.

Id.

Furthermore, contrary to Tower’s argument, the EEOC contends that
an arbitrator’s decision will not have any preclusive effect on
the EEOC; therefore, the EEOC argues it would be free to pursue
its claims regardless of the outcome of arbitration. Id. at 16.
In reply to the EEOC’s and Broussard’s opposition, Tower
maintains that if the Court compels Broussard to arbitrate his
claims

and

does

not

stay

the

EEOC’s

claims

pending

such

arbitration, then Tower “will simultaneously be defending two
separate proceedings in two separate forums involving identical
allegations.

It

is

very

likely

that

the

same

discovery,

depositions, and motions will take place in both forums, increasing
case expenses, disruptions and inconvenience, and the likelihood
16

of inconsistent rulings.” (Rec. Doc. 110, at 7.) Further, Tower
clarifies that it does not claim that the EEOC’s public interests
claims will be barred by res judicata; rather, it argues that the
EEOC’s ability to seek individual relief for Broussard will be
barred

by

the

anticipated

arbitration.

Id.

Otherwise,

Tower

insists that Broussard would get “two bites at the apple—one before
the arbitrator and another by the EEOC on his behalf in this
litigation.” Id. at 8.
LEGAL STANDARD
The Fifth Circuit has observed that “[i]n enacting the Federal
Arbitration Act, Congress declared a national policy in favor of
arbitration.” Snap-on Tools Corp. v. Mason, 18 F.3d 1261, 1263
(5th Cir. 1994) (citing Southland Corp. v. Keating, 465 U.S. 1, 10
(1984)). Section 2 of the Federal Arbitration Act (“FAA”), 9 U.S.C.
§ 1, et seq., provides, in relevant part, “A written provision in
. . . a contract evidencing a transaction involving commerce to
settle by arbitration a controversy thereafter arising out of such
contract or transaction . . . shall be valid, irrevocable, and
enforceable, save upon such grounds as exist at law or in equity
for revocation of any contract.” 9 U.S.C. § 2. Congress has
therefore mandated the enforcement of arbitration agreements.
Considered to be “the primary substantive provision of the
Act,” Section 2 reflects “a congressional declaration of a liberal
federal policy favoring arbitration agreements.” Moses H. Cone
17

Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983). In
effect, Section 2 creates “a body of federal substantive law of
arbitrability.” Id. “[C]ongress’ clear intent, in the Arbitration
Act, [was] to move the parties to an arbitrable dispute out of
court and into arbitration as quickly and easily as possible.”
Snap-on Tools Corp., 18 F.3d at 1263 (alterations in original)
(quoting Moses H. Cone Mem. Hosp., 460 U.S. at 22). Thus, there is
a strong presumption in favor of arbitration.
The FAA requires district courts to “compel arbitration of
otherwise arbitrable claims, when a motion to compel arbitration
is made.” Sedco, Inc. v. Petroleos Mexicanos Mexican Nat’l Oil
Co., 767 F.2d 1140, 1147 n.20 (5th Cir. 1985). Section 3 of the
FAA provides:
If any suit or proceeding be brought in any of the courts
of the United States upon any issue referable to
arbitration under the agreement in writing for such
arbitration, the court in which such suit is pending,
upon being satisfied that the issue involved in such
suit or proceeding is referable to arbitration under
such an agreement, shall on application of one of the
parties stay the trial of the action until such
arbitration has been had in accordance with the terms of
the agreement, providing the applicant for the stay is
not in default in proceeding with such arbitration.
9 U.S.C. § 3. This provision is mandatory and demands a stay of
the proceedings, at the request of a party, if the dispute is
arbitrable and referred to arbitration. Tittle v. Enron Corp., 463
F.3d 410, 417 n.6 (5th Cir. 2006).

18

Courts employ a two-step analysis to determine whether a party
may be compelled to arbitrate. Jones v. Halliburton Co., 583 F.3d
228, 233 (5th Cir. 2009); Wash. Mut. Fin. Grp. v. Bailey, 364 F.3d
260, 263 (5th Cir. 2004); Webb v. Investacorp, Inc., 89 F.3d 252,
257-58 (5th Cir. 1996). The Court first inquires whether the party
has agreed to arbitrate the dispute at issue. Jones, 583 F.3d at
233-34.

This

question

considerations:

“(1)

itself
whether

is

further

there

is

a

subdivided
valid

into

agreement

two
to

arbitrate between the parties; and (2) whether the dispute in
question falls within the scope of that arbitration agreement.”
Webb, 89 F.3d at 257-58. To determine whether the parties formed
a

valid

agreement

to

arbitrate,

the

Court

applies

ordinary

principles of state contract law. Am. Heritage Life Ins. Co. v.
Lang, 321 F.3d 533, 537-38 (5th Cir. 2003); Grigson v. Creative
Artists Agency, LLC, 210 F.3d 524, 531 (5th Cir. 2000). “[T]he
federal

policy

favoring

arbitration

does

not

apply

to

the

determination of whether there is a valid agreement to arbitrate
between the parties.” Am. Heritage Life Ins. Co., 321 F.3d at 538.
In analyzing arbitrability, courts apply federal substantive law.
Grigson, 210 F.3d at 531. Thus, “any doubts concerning the scope
of arbitrable issues should be resolved in favor of arbitration,
whether the problem at hand is the construction of the contract
language itself or an allegation of waiver, delay, or a like
defense to arbitrability.” Moses H. Cone, 460 U.S. at 24-25. If
19

the Court finds that there is a valid agreement to arbitrate
between the parties and that the dispute in question falls within
the scope of the arbitration agreement, the second step is to
determine whether any federal statute or policy renders the claims
nonarbitrable. Wash. Mut. Fin. Grp., 364 F.3d at 263.
DISCUSSION
A.

Motion to Compel Arbitration
The Court must first apply ordinary principles of state

contract law to determine whether there is a valid agreement to
arbitrate between Broussard and Tower. Under Louisiana law, 5 “[a]
contract is an agreement by two or more parties whereby obligations
are created, modified, or extinguished.” La. Civ. Code art. 1906.
Four elements are required for a valid contract: (1) capacity to
contract; (2) mutual consent; (3) a lawful cause; (4) and an object
that is lawful, possible, and determined or determinable. Granger
v. Christus Health Cent. La., 144 So. 3d 736, 760-61 (La. 2013);
see also La. Civ. Code arts. 1918, 1927, 1966 1971. The party
claiming the existence of a contract has the burden of proving
that the contract was perfected. La. Civ. Code art. 1831.

5

The Employment Agreement at issue contains a choice-of-law provision that
provides, in pertinent part, “The interpretation and application of this
contract (as well as choice of law principles) . . . is governed by Mississippi
law.” (Rec. Doc. 85-2, at 4.) Yet, none of the parties briefed the Court on the
choice-of-law issue, and the parties’ memoranda apply Louisiana law.
Consequently, the Court applies Louisiana law to determine whether Broussard
and Tower formed a valid agreement to arbitrate. However, the Court’s conclusion
would be the same under Mississippi law.

20

The element critical to the issue before the Court is the
element of mutual consent. Article 1927 of the Louisiana Civil
Code explains that “[a] contract is formed by the consent of the
parties established through offer and acceptance.” Id. art. 1927.
Unless the law requires a certain formality for a type of contract,
offer and acceptance may be made orally, in writing, or by action
or inaction that clearly indicates consent. Id. However, in the
absence of a legal requirement, when the parties have contemplated
a certain form, it is presumed that they do not intend to be bound
until the contract is executed in that form. Id. art. 1947. In
addition, an acceptance not in accordance with the terms of the
offer is not an acceptance at all, but rather a counteroffer which
must be accepted in order to become a binding contract. Id. art.
1943. Thus, to constitute a contract, an offer must be accepted as
made.
An offer to make a contract is good, generally speaking, until
revoked by the offeror or rejected by the offeree. An offer that
neither specifies a period of time for acceptance nor manifests an
intent to give the offeree a delay within which to accept is a
revocable offer, which may be revoked before it is accepted. Id.
arts. 1928, 1930. Furthermore, a revocable offer expires if not
accepted within a reasonable time. Id. art 1931. A purported
acceptance

made

after

the

expiration

21

of

the

initial

offer

constitutes a new counteroffer, which must be accepted in order to
form a binding contract.
In the instant case, Tower argues that both the Employment
Agreement and the Acceptance Form, which incorporates the terms of
the Employment Agreement, constitute valid contracts to arbitrate
employment-related disputes. The Court first considers whether the
Acceptance

Form

constitutes

a

binding

contract

with

a

valid

arbitration agreement.
The Acceptance Form is a written contract between Broussard
and Tower. The Acceptance Form clearly states that it is an “offer
of employment” from Tower for Broussard to accept. (Rec. Doc. 852, at 3.) Before beginning work at Tower, Broussard signed the
Acceptance Form below the statement, “I accept this offer of
employment.” Id. The Acceptance Form provides that the terms of
the offer “are governed by the terms outlined in the employment
agreement you will sign.” Id. “As a general rule of contract law,
separate

documents

may

be

incorporated

into

a

contract

by

attachment or reference thereto.” Arthur J. Gallagher & Co. v.
Babcock, 703 F.3d 284, 289 (5th Cir. 2012); AWC, Inc. v. CSF
Const., Inc., 931 So. 2d 382, 386 (La. App. 4 Cir. 2006). Further,
the Louisiana Second, Third, Fourth, and Fifth Circuit Courts of
Appeal have held: “The incorporation of an arbitration clause by
reference to another written contract is a suitable method of
evidencing

the

parties’

intent
22

to

arbitrate

as

long

as

the

arbitration clause in the contract that is referred to has ‘a
reasonably

clear

and

ascertainable

meaning.’”

Aeneas

Williams

Imports, L.L.C. v. Carter, 131 So. 3d 894, 896 (La. App. 2 Cir.
2012); accord Woodson Const. Co. v. R.L. Abshire Const. Co., 459
So. 2d 566, 569 (La. App. 3 Cir. 1984); Regions Bank v. Weber, 53
So. 3d 1284, 1290 (La. App. 4 Cir. 2010); Russellville Steel Co.
v. A & R Excavating, Inc., 624 So. 2d 11, 13 (La. App. 5 Cir.
1993).

Therefore,

it

is

accepted

practice

to

incorporate

by

reference an arbitration provision not shown on the face of the
document.
It is undisputed that the Employment Agreement contained an
arbitration provision. Moreover, the arbitration clause in the
Employment Agreement is clear. As mentioned above, the arbitration
provision provides that “all . . . disputes, legal or otherwise,
relating to the employment relationship shall be submitted to
binding arbitration by the parties.” (Rec. Doc. 85-2, at 4.)
Further, the arbitration provision contains a nonexhaustive list
of

arbitrable

Broussard’s

issues,

argument

including

that

the

wrongful

Acceptance

discharge.
Form

Id.

necessarily

incorporates the provision of the Agreement stating that the
Broussard’s signature on the Agreement is an offer of employment
which must be accepted by Tower is untenable. To reach that
conclusion, the Court would be required to disregard the express
language in the Acceptance Form, which clarifies that Broussard
23

may accept Tower’s offer of employment. While the Acceptance Form
mentions

the

Employment

Agreement

and

contemplates

Broussard

signing it, the Acceptance Form indicates that Broussard may accept
the offer and form an employment relationship immediately: “The
terms of your employment offer are governed by the terms outlined
in the employment agreement you will sign. However, if you are
ready to be a member of the Tower Loan team . . ., just sign below
indicating . . . your acceptance of our offer.” Id. (emphasis
added). Broussard signed both the Employment Agreement and the
Acceptance Form. Id. at 3-4. Thus, there is a valid arbitration
agreement.
Broussard’s argument that the agreement lacks consideration
is misplaced. As an initial matter, the common law concept of
consideration

is

not

relevant

to

a

contractual

analysis

in

Louisiana. See La. Civ. Code art. 1967 cmt. (c) (“Under this
Article, ‘cause’ is not ‘consideration.’”); Unkel v. Unkel, 699
So. 2d 472, 475 (La. App. 2 Cir. 1997)

(“Consideration, in the

common-law sense, is not a prerequisite for a valid contract in
Louisiana,

and

is

distinguished

from

cause.”).

Instead

of

consideration, under Louisiana law, a contract requires a lawful
cause and object. Cause is the reason a party obligates himself,
not the terms of the obligation. See La. Civ. Code art. 1967. The
objects of a contract are the specific actions the parties must
undertake to comply with the contract. See id. art. 1971. Here,
24

Broussard signed the Acceptance Form as a condition of employment.
“Employment [is a] valid cause of [a] contract.” Cellular One,
Inc. v. Boyd, 653 So. 2d 30, 34 (La. App. 1 Cir. 1995). Moreover,
such an agreement is supported by valid consideration. See Hadnot
v. Bay, Ltd., 344 F.3d 474, 477 (5th Cir. 2003) (holding offer of
at-will

employment

was

adequate

consideration

to

support

arbitration agreement and was not illusory “because any eventual
arbitration will, of necessity, relate to conduct that occurred
during the term of employment”); New S. Fed. Sav. Bank v. Anding,
414 F. Supp. 2d 636, 643 (S.D. Miss. 2005) (“Under Mississippi
law, any mutual promises, such as mutual promises to arbitrate
certain

claims,

Acceptance

Form

constitute
signed

by

consideration.”).
Broussard

Accordingly,

contains

a

the

consensual

agreement to arbitrate which is binding and valid under Louisiana
law and therefore Broussard is bound to that agreement and the
dictates of the Federal Arbitration Act.
Having determined that Broussard and Tower formed a valid
arbitration agreement, the Court must now consider whether the
dispute in question falls within the scope of the arbitration
provision. When determining whether a dispute is covered by the
scope of an arbitration agreement, the Supreme Court has held that
“any doubts concerning the scope of arbitrable issues should be
resolved in favor of arbitration.” Moses H. Cone, 460 U.S. at 2425. The Fifth Circuit has likewise stated that doubts concerning
25

the scope of an arbitration agreement should be resolved in favor
of arbitration. Safer v. Nelson Fin. Grp., Inc., 422 F.3d 289, 294
(5th

Cir.

2005).

Moreover,

the

Fifth

Circuit

has

repeatedly

emphasized the strong federal policy in favor of arbitration. Thus,
“arbitration should not be denied ‘unless it can be said with
positive

assurance

that

[the]

arbitration

clause

is

not

susceptible of an interpretation which would cover the dispute at
issue.’” Id. (alteration in original) (quoting Pers. Sec. & Safety
Sys. Inc. v. Motorola Inc., 297 F.3d 388, 392 (5th Cir. 2002)).
In addition, the Fifth Circuit distinguishes between broad
and narrow arbitration clauses. “If the clause is broad, the action
should be stayed and the arbitrators permitted to decide whether
the

dispute

falls

within

the

clause.”

Complaint

of

Hornbeck

Offshore (1984) Corp., 981 F.2d 752, 754 (5th Cir. 1993). On the
other hand, if the clause is narrow, the matter should not be
referred to arbitration or the action stayed, unless the court
determines that the dispute falls within the clause. Id. at 755.
Arbitration clauses containing the “all dispute” language, such as
the one presently before the Court, are of the broad type. See id.
Here, the dispute at issue falls squarely within the scope of
the arbitration agreement. The arbitration provision applies to
all

disputes

“relating

to

the

employment

relationship,”

and

includes claims based on “sexual” matters and claims for “wrongful
termination.”

Further,

the

arbitration
26

clause

is

broad.

The

arbitration clause makes it clear that the “scope of arbitration”
is to be decided by the arbitrator. Accordingly, the Court is
required to grant a stay under 9 U.S.C. § 3 and permit the
arbitrator to decide whether Broussard’s claims fall within the
scope of the arbitration clause.
Having found that there is a valid arbitration agreement
between the parties and that the dispute in question falls within
the scope of the arbitration provision, the second step is to
determine whether any federal statute or policy renders the claims
nonarbitrable. Although the EEOC’s opposition does not mention the
Acceptance Form, it argues that a contract compelling arbitration
would be unenforceable in this case. First, the EEOC argues that
Tower has not established a knowing and voluntary waiver of the
right to a trial by jury. However, the valid agreement to arbitrate
is itself a knowing and voluntary waiver of the right to a jury
trial. As the Fifth Circuit has noted, “The Seventh Amendment does
not confer the right to a trial, but only the right to have a jury
hear the case once it is determined that the litigation should
proceed before a court. If the claims are properly before an
arbitral forum pursuant to an arbitration agreement, the jury trial
right vanishes.” Am. Heritage Life Ins. Co. v. Orr, 294 F.3d 702
(5th Cir. 2002) (quoting Cremin v. Merrill Lynch, Pierce, Fenner
& Smith, Inc., 957 F. Supp. 1460, 1471 (N.D. Ill. 1997)). In short,
“[t]he Seventh Amendment right to a trial by jury is limited by a
27

valid arbitration provision that waives the right to resolve a
dispute through litigation in a judicial forum.” Id.; see also
Garza Nunez v. Weeks Marine, Inc., No. 06-3777, 2007 WL 496855, at
*7 n.14 (E.D. La. Feb. 13, 2007) (“If he indeed entered into an
arbitration agreement, the Plaintiff would be deemed to have waived
his right to a jury trial.”).
The EEOC also argues that the arbitration provision at issue
is unenforceable under Title VII because it purports to foreclose
the filing of an EEOC charge. “A waiver of the right to file a
charge is void as against public policy.” EEOC v. Cosmair, Inc.,
L'Oreal Hair Care Div., 821 F.2d 1085, 1090 (5th Cir. 1987).
However, an unenforceable provision of an arbitration clause will
not render the entire arbitration provision void. See Hadnot v.
Bay,

Ltd.,

344

F.3d

474,

478

(5th

Cir.

2003)

(severing

unenforceable provision in arbitration clause barring any award of
punitive damages and upholding remainder of arbitration clause
that authorized arbitration of any and all disputes arising out of
employment

relationship);

Cosmair,

Inc.,

821

F.2d

at

1091

(“[C]ourt may enforce remainder of agreement unenforceable in part
as

against

public

policy

when

‘performance

as

to

which

the

agreement is unenforceable is not an essential part of the agreed
exchange.’”). Here, there is no evidence that Tower attempted to
prohibit Broussard from filing an EEOC charge in the Acceptance
Form, Employment Agreement, or otherwise. In fact, it is undisputed
28

that an EEOC charge was filed on Broussard’s behalf and fully
processed by the EEOC. (Rec. Doc. 1, at 8-9.) Accordingly, the
Court rejects the EEOC’s arguments.
Lastly, Broussard argues that Tower waived its right to compel
arbitration because of its “aggressive litigation” in this matter.
The right to arbitration, like any contractual right, may be
waived. Price v. Drexel Burnham Lambert, Inc., 791 F.2d 1156, 1158
(5th Cir. 1986). The party seeking to prove a waiver of arbitration
bears a heavy burden: “Waiver of arbitration is not a favored
finding, and there is a presumption against it.” Miller Brewing
Co. v. Fort Worth Distrib. Co., 781 F.2d 494, 496 (5th Cir. 1986).
“A party waives its right to arbitration only when participation
in

the

litigation

has

been

so

substantial

that

compelling

arbitration would prejudice the other party.” Cargill Ferrous
Int'l v. SEA PHOENIX MV, 325 F.3d 695, 700 (5th Cir. 2003). For
example, in Price v. Drexel Burnham Lambert, Inc., the court held
that the party moving for arbitration had waived that right because
it

had

“initiated

extensive

discovery,

answered

twice,

filed

motions to dismiss and for summary judgment, filed and obtained
two

extensions

of

pre-trial

deadlines,

all

without

demanding

arbitration.” 791 F.2d at 1159-62. On the other hand, where the
party seeking arbitration asserts the right to demand arbitration
in answer to a complaint, “the burden of proving waiver falls even
more heavily on the shoulders of the party seeking to prove
29

waiver.” Tenneco Resins, Inc. v. Davy Int'l, AG, 770 F.2d 416, 420
(5th Cir. 1985).
In the instant case, Broussard fails to meet the heavy burden
of

proving

waiver.

Broussard

claims

that

Tower

substantially

invoked the judicial process by filing its own countersuit in
Mississippi; however, Broussard fails to mention that Tower filed
suit in Mississippi solely to compel arbitration. Tower filed its
lawsuit according to the specific provision in the Employment
Agreement that authorizes Tower to file suit seeking injunctive
relief in the Chancery Court of Rankin County, Mississippi. Tower
filed its suit to compel arbitration within ten days of Broussard
filing suit in this Court. For this reason, Tower’s filing of its
lawsuit against Broussard in Mississippi strongly supports the
conclusion

that

Tower

did

not

waive

its

rights

to

compel

arbitration. Moreover, Tower has repeatedly expressed that it
considers Broussard’s claims to be subject to binding arbitration.
For example, as its first defense in its Answer, Tower stated that
Broussard’s

claims

are

subject

to

arbitration

and

should

be

dismissed or stayed. (Rec. Doc. 46, at 1.) Therefore, Broussard
had notice that Tower planned to compel arbitration and has not
shown that compelling arbitration would prejudice him.
Tower further requests that the Court appoint the AAA to
conduct

the

arbitration

in

accordance

with

its

protocol

for

resolution of employment disputes. Under the FAA, courts may
30

intervene into the arbitral process to select an arbitrator upon
application of a party, if the arbitration agreement does not
provide a method for selecting arbitrators. BP Expl. Libya Ltd. v.
ExxonMobil Libya Ltd., 689 F.3d 481, 490-91 (5th Cir. 2012).
Section 5 dictates that when an agreement to arbitrate does not
provide a method for appointment of an arbitrator, “upon the
application of either party to the controversy the court shall
designate and appoint an arbitrator or arbitrators or umpire, as
the case may require, who shall act under the said agreement with
the same force and effect as if he or they had been specifically
named therein.” 9 U.S.C. § 5 (emphasis added). Neither Broussard
nor the EEOC have objected to the Court appointing the AAA to
conduct the arbitration. Accordingly, unless Broussard and Tower
reach an agreement on an arbitrator, 6 the Court directs that the
arbitration proceed before the AAA, with the parties to select an
arbitrator pursuant to the provisions of the AAA’s Employment
Dispute Resolution Rules.

6 Tower notes, “During earlier discussions between Tower Loan’s Mississippi
counsel and certain of Plaintiff’s attorneys the parties reached what appeared
to be a tentative agreement for submitting Broussard’s claims to arbitration
before one of two Mississippi employment attorneys, J. William Manuel (Bradley
Arrant) or Peyton S. Irby, Jr. (Kullman Firm) (both located in Jackson
Mississippi).” (Rec. Doc. 85-1, at 19 n.19.) However, Broussard’s counsel have
since declined to take a position regarding whether these attorneys are
agreeable arbitrators. Id. Tower states that it would be agreeable to conducting
the arbitration before either of these attorneys pursuant to the AAA protocols
for resolution of employment disputes. Id.

31

B.

Motion to Stay Pending Arbitration
Under section 3 of the FAA, a district court must stay a

lawsuit when a party demonstrates that any issue involved in the
lawsuit is “referable to arbitration under an agreement in writing
for such arbitration.” 9 U.S.C. § 3. This provision is mandatory
and demands a stay of legal proceedings “whenever the issues in a
case are within the reach of an arbitration agreement.” Complaint
of Hornbeck Offshore (1984) Corp., 981 F.2d at 754. When these
circumstances are present, a district court “has no discretion
under section 3 to deny the stay.” Id.
The first issue the Court must address in determining whether
the

mandatory

defendant

in

agreement,

stay
this

may

provision
matter

invoke

and

the

applies
a

is

whether
to

signatory

provision

Tower,

arbitration

the

against

the

EEOC,

the

the

intervenor, who is a nonsignatory to the arbitration agreement.
Historically, invocation of the mandatory stay provision was
limited to signatories of the arbitration agreement and was not
effective against any nonsignatory parties present in the lawsuit.
Adams v. Ga. Gulf Corp., 237 F.3d 538, 540 (5th Cir. 2001)
(“Generally,

this

section

applies

only

to

parties

to

the

arbitration agreement.”). However, in recent years, courts have
expanded the applicability of the mandatory stay provision. For
example,

in

Adams

v.

Georgia

Gulf

Corp.,

the

Fifth

Circuit

summarized two cases where the court “applied the stay provision
32

to non-parties because the issues presented in the nonparty-party
litigation

if

litigated

would

have

rendered

the

arbitration

redundant and thwarted the federal policy favoring arbitration.”
Id. at 540-41 (citing Harvey v. Joyce, 199 F.3d 790 (5th Cir.2000);
Subway Equip. Leasing Corp. v. Forte, 169 F.3d 324 (5th Cir.1999)).
Because the court was confronted with “exceptional circumstances,”
it diverged from the general rule requiring party status for the
mandatory stay provision to apply. Id. at 541. Similarly, in Waste
Management, Inc. v. Residuous Industriales Multiquim, S.A. de
C.V., the Fifth Circuit held that a nonsignatory to an arbitration
agreement could invoke the mandatory stay provision. 372 F.3d 339,
342 (5th Cir. 2004). The court found that the signatory’s claims
in the litigation were so closely related to the arbitration and
would have such an impact on the arbitration as to make a stay
mandatory under section 3. Id. at 345.
In Waste Management, the Fifth Circuit articulated three
factors that courts must consider in determining whether the
mandatory stay provision applies: “1) the arbitrated and litigated
disputes must involve the same operative facts; 2) the claims
asserted in the arbitration and litigation must be ‘inherently
inseparable’; and 3) the litigation must have a ‘critical impact’
on the arbitration.” Id. at 343. “The question is not ultimately
one of weighing potential harm to the interests of the nonsignatory, but of determining whether proceeding with litigation
33

will destroy the signatories’ right to a meaningful arbitration.”
Id. (citing Adams, 237 F.3d at 541).
When a mandatory stay under section 3 is not warranted, the
court

may

nonetheless

exercise

its

discretion

to

stay

the

litigation pending the outcome of the arbitration, even as to
claims

between

nonarbitrating

parties,

simply

as

a

means

of

controlling its docket. Complaint of Hornbeck Offshore (1984)
Corp., 981 F.2d at 755 (citing Moses H. Cone, 460 U.S. at 20 n.23;
Matter of Talbott Big Foot, Inc., 887 F.2d 611, 614 (5th Cir.
1989)). The court’s discretionary authority to issue a stay is
“incidental to the power inherent in every court to control the
disposition of the causes on its docket with economy of time and
effort for itself, for counsel, and for litigants.” Landis v. N.
Am. Co., 299 U.S. 248, 254 (1936); accord Ambraco, Inc. v. Bossclip
B.V., 570 F.3d 233, 243 (5th Cir. 2009) (citing Coastal (Bermuda)
Ltd. v. E.W. Saybolt & Co., 761 F.2d 198, 204 n.6 (5th Cir. 1985)).
Determining whether to issue a discretionary stay “calls for the
exercise of judgment, which must weigh competing interests and
maintain and even balance.” Landis, 299 U.S. at 255.
Considering the three Waste Management factors, the Court
finds that a discretionary, if not a mandatory, stay is warranted.
First,

the

EEOC’s

claims

and

Broussard’s

claims

undoubtedly

involve the same operative facts. Notably, in its Notice of Intent
to Intervene, the EEOC stated, “The nexus of factual circumstances
34

central to the EEOC’s claims will be those at issue in Mr.
Broussard’s suit against First Tower Loan, LLC.” (Rec. Doc. 51, at
1.)

Moreover,

the

EEOC’s

complaint

and

Broussard’s

complaint

allege the same operative facts. (Compare Rec. Doc. 1, at 3-7,
with Rec. Doc. 71, at 4-8.) “The close relationship between the
facts involved in the federal court claims and the arbitration
claims counsels in favor of staying this litigation.” Suzlon
Infrastructure, Ltd. v. Pulk, No. H-09-2206, 2010 WL 3540951, at
*8 (S.D. Tex. Sept. 10, 2010).
Second, although the subject matter of the EEOC’s claims and
Broussard’s

claims

are

similar,

they

are

not

“inherently

inseparable.” When the EEOC chooses to bring an enforcement action
in a particular case, or chooses to intervene in an aggrieved
employee’s action as it did here, “the agency may be seeking to
vindicate a public interest, not simply provide make-whole relief
for the employee.” EEOC v. Waffle House, Inc., 534 U.S. 279, 296
(2002). Here, some of the EEOC’s claims are brought to vindicate
a public interest and, therefore, are not inherently inseparable
from Broussard’s personal claims. However, the facts and claims
“significantly overlap.” Suzlon, 2010 WL 3540951, at *8. Indeed,
litigating the EEOC’s claims will involve much of the same evidence
developed in the arbitration.
Finally, the litigation would likely have a “critical impact”
on the arbitration. Several of the EEOC’s claims seek victim35

specific relief “to make Mr. Broussard whole,” such as backpay,
reinstatement,

and

damages.

Broussard

seeks

the

same

relief.

Consequently, resolving these claims of the EEOC would resolve
issues that the arbitrator will decide. Given the binding effect
of a federal judgment, as well as the factual similarities in the
EEOC’s

claims,

the

arbitrator

would

necessarily

be

strongly

influenced to follow the Court's determination. See Waste Mgmt.,
372 F.3d at 345. Thus, “[a]llowing the instant litigation to
proceed

would

risk

inconsistent

results,

and

‘substantially

impact’ the arbitration.” Id.
A discretionary stay of this litigation will also enable the
Court

and

the

parties

to

benefit

from

the

outcome

of

the

arbitration. For example, Tower argues that if Broussard’s claims
for victim-specific relief are resolved by the arbitrator, then
the only claims left for the EEOC to pursue would be claims for
general injunctive relief, which must be decided by the Court
rather than a jury. The EEOC vigorously opposes this argument,
relying on the Supreme Court’s holding in EEOC v. Waffle House,
Inc., 534 U.S. 279 (2002). In Waffle House, the Supreme Court held
that an agreement between an employer and an employee to arbitrate
employment-related disputes does not bar the EEOC from pursuing
victim-specific judicial relief, such as backpay, reinstatement,
and damages, in an enforcement action. Id. at 287-88. However, in
Waffle House, the EEOC filed an enforcement action and the employee
36

was not a party to the case. Id. at 283. Moreover, the employee
had not sought arbitration of his claim. Id. at 297. Therefore,
the Court did not consider what effect, if any, arbitration of the
employee’s claim would have on the EEOC’s claims. Id. In this
regard, the Court stated:
It is an open question whether a settlement or
arbitration judgment would affect the validity of the
EEOC's claim or the character of relief the EEOC may
seek. The only issue before this Court is whether the
fact that [the employee] has signed a mandatory
arbitration agreement limits the remedies available to
the EEOC.
Id. Further, the Court noted that it “goes without saying that the
courts can and should preclude double recovery by an individual”
and “ordinary principles of res judicata, mootness, or mitigation
may apply to EEOC claims.” Id. at 297-98.
In the instant case, Tower does not dispute that the EEOC may
seek victim-specific relief in an enforcement action, even if a
valid

arbitration

agreement

exists

between

the

employer

and

employee. Thus, the EEOC’s reliance on Waffle House is misplaced.
Instead, Tower asserts that the principles of res judicata may
apply to the EEOC’s claims and, therefore, an arbitration judgment
could affect the validity of the EEOC’s claims or the character of
relief the EEOC may seek. The Fifth Circuit supports Tower’s
assertion. In EEOC v. Jefferson Dental Clinics, PA, the Fifth
Circuit held that the EEOC was barred from seeking make-whole
relief for employees who had already litigated their claims in
37

state court. 478 F.3d 690, 699 (5th Cir. 2007) (applying Texas
law). 7 The court’s holding was based on the res judicata effect of
the prior state court judgment in the employees’ case. Id. The
court reasoned that “[i]n the context of make-whole relief, . . .
the interests of the EEOC stack up poorly against the principles
of res judicata.” Similarly, the court explained that “[t]he EEOC’s
public interest does not justify giving the plaintiffs two chances
to receive make-whole relief.” Id. (citing Waffle House, 534 U.S.
at 296-97.) However, “given the divergence of interests between
the charging parties and the EEOC when it seeks injunctive relief,”
the court allowed the EEOC’s injunctive relief claims to proceed.
Id. at 698. Thus, in this case, the EEOC’s ability to seek makewhole

relief

on

behalf

of

Broussard

may

be

limited

by

the

arbitration.
Lastly, the EEOC relies on Harris v. Amoco Production Co.,
768 F.2d 669 (1985), to support its argument that a stay would
thwart its authority to enforce Title VII in the public’s interest.

7

The EEOC argues that Tower’s reliance on EEOC v. Jefferson Dental Clinics, PA
is improper because it is inconsistent with the Supreme Court’s decision in
Taylor v. Sturgell, 553 U.S. 880 (2008), and because it applied Texas law rather
than federal law. However, the EEOC does not point to any inconsistencies
between Jefferson Dental and Taylor, and courts have cited Jefferson Dental
with approval since Taylor. See Jackson v. Deutsche Bank Trust Co., 583 F. App'x
417, 418 (5th Cir. 2014). Further, although Jefferson Dental applied Texas law
rather than federal law, there is nothing to indicate that federal law would
require a different conclusion. Compare Jefferson Dental, 478 F.3d at 695-99
(analyzing the representation-of-interests inquiry under Texas law), with
Taylor, 553 U.S. at 894-900 (discussing the representation-of-interests inquiry
under federal law). Nevertheless, the issue of res judicata is not presently
before the Court and the Court need not decide whether any of the EEOC’s claims
would be barred by res judicata at this time.

38

In

Harris,

dismissal

the

of

Fifth

the

Circuit

EEOC’s

reversed

claims

when

the

the

district

original

court’s

plaintiffs

settled. Id. at 682. Reasoning “from the premise that the EEOC
exists

to

represent

the

public

interest

in

equal

employment

opportunity,” the court held that the EEOC, which had intervened
in the case, had the authority to continue litigating after the
main plaintiffs had settled out of the lawsuit. Id. Here, although
Tower opposed the EEOC’s initial motion to intervene, Tower does
not dispute that Title VII grants the EEOC the statutory right to
intervene under certain circumstances. Nor does Tower seek to
dismiss the EEOC’s claims at this time. Rather, Tower seeks a stay
of the EEOC’s claims pending the final outcome of the arbitration
between Broussard and Tower. Accordingly, the EEOC’s reliance on
Harris is misplaced.
Considering the factors set out in Waste Management, the Court
concludes that a stay in this matter is warranted. The operative
facts

are

identical,

the

claims

significantly

overlap,

and

allowing the litigation to proceed would risk inconsistent results
and substantially impact the arbitration. Moreover, the Court and
the parties may benefit from the outcome of the arbitration. In
sum, even if these factors do not require a mandatory stay under
section

3,

those

factors,

on

the

discretionary stay.

39

present

record,

support

a

CONCLUSION
Accordingly,
IT IS HEREBY ORDERED that Defendant’s Motion to Compel
Arbitration, Appoint Arbitrator and to Stay Proceedings (Rec. Doc.
85) is GRANTED.
IT IS FURTHER ORDERED that the Court appoints the American
Arbitration

Association

as

the

arbitral

forum

to

administer

arbitration of the dispute between Broussard and Tower.
IT IS FURTHER ORDERED that Defendant’s Motion to Stay EEOC
Claims Pending Arbitration (Rec. Doc. 96) is GRANTED.
IT IS FURTHER ORDERED that all proceedings in this matter
shall be STAYED pending the outcome of the arbitration between
Broussard and Tower. The Clerk of Court shall mark this action
closed for statistical purposes.
IT IS FURTHER ORDERED that the Court shall retain jurisdiction
and that the case shall be restored to the trial docket upon motion
of a party if circumstances change, so that it may proceed to final
disposition. This order shall not prejudice the rights of the
parties to this litigation.
New Orleans, Louisiana, this 9th day of December, 2015.

CARL J. BARBIER
UNITED STATES DISTRICT JUDGE
40