Hall-Cloutier v. Sig Sauer, Inc.
ORDER granting in part and denying in part 4 Motion to Compel. So Ordered by Judge Landya B. McCafferty.(gla)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
Civil No. 17-cv-491-LM
Opinion No. 2018 DNH 010
Sig Sauer, Inc.
O R D E R
Plaintiff Patricia Hall-Cloutier (“Hall”) brings suit
against her former employer, Sig Sauer, Inc. (“Sig Sauer”),
alleging that Sig Sauer wrongfully terminated her for requesting
leave under the Family Medical Leave Act (“FMLA”) and in
response to her reporting violations of federal law by other Sig
Sig Sauer moves to compel Hall to arbitrate
the claims she has asserted in this action and requests that the
court stay the case pending arbitration.
STANDARD OF REVIEW
Both Hall and Sig Sauer rely on materials beyond those
attached to or referenced in Hall’s complaint.
circumstances, courts in the First Circuit employ the summary
judgment standard in resolving a motion to compel arbitration.
See, e.g., Landry v. Time Warner Cable, Inc., No. 16-cv-507-SM,
2017 WL 3431959, at *1 (D.N.H. Aug. 9, 2017) (citing cases).
Therefore, Sig Sauer must show “that there is no genuine dispute
as to any material fact and [that it] is entitled to” the relief
Fed. R. Civ. P. 56(a).
In reviewing the record, the
court construes all facts and reasonable inferences in the light
most favorable to the nonmovant.
Kelley v. Corr. Med. Servs.,
Inc., 707 F.3d 108, 115 (1st Cir. 2013).
On September 15, 2015, Sig Sauer hired Hall as its Director
of Import/Export Compliance.
Over the next year-and-a-half,
Hall performed her job well, and received at least one
During her employment, Hall identified and reported
instances in which documentation regarding the export of Sig
Sauer weapons violated applicable United States laws regarding
export license applications, agreements, and regulations.
last one of these instances occurred in June 2017.
On June 1, 2017, Hall discovered that someone within Sig
Sauer’s Sales Department had changed the identified recipient of
a shipment of controlled weapons, as identified by the National
After she investigated the matter, she learned
that the Sales Department intentionally gave the freight
forwarder incorrect paperwork to conceal the actual recipient in
violation of state and federal law.
Shortly after discovering the Sales Department’s conduct,
Hall reported the violation to her supervisor, Mr. Shawver.
Shawver asked Hall several questions about the violation and
suggested that Sig Sauer would need to investigate the matter
Shawver was out of the office on vacation for the few days
following his discussion with Hall.
While Shawver was on
vacation, Hall asked the freight forwarder for more information
and stated that there would be an investigation regarding the
shipment in question.
On the morning of June 6, 2017, Shawver called Hall and
told her that he would be in the office later that afternoon.
During that phone call, the two discussed various issues
regarding Sig Sauer’s business, but Shawver did not mention the
recent violation Hall had reported.
Hall also reminded Shawver
that she would be out of the office that afternoon to attend her
mother’s oncology appointment.
Hall, who had taken personal and
vacation leave caring for her mother, had notified Sig Sauer in
April 2017 that she would need to take FMLA leave throughout
2017 to care for her mother.
Later on June 6, Hall received a call from a representative
in the Human Resources department asking her to come to the
When she arrived, she saw Shawver
standing next to the representative’s desk.
Hall that there had been a “reorganization,” that her position
had become “redundant,” and that Sig Sauer was “letting her go.”
A security manager escorted Hall from the building shortly
Following her termination, Hall brought this suit in New
Hampshire Superior Court, Rockingham County, alleging a
Whistleblower Claim under RSA 275-E, and claims for wrongful
termination and FMLA retaliation.
Sig Sauer removed the case to
this court and now moves to compel Hall to arbitrate the claims
she asserts in this action.
Sig Sauer also requests that the
court stay the matter pending arbitration.
In support, Sig Sauer asserts that before Hall’s employment
began, she signed a “Confidential Information, Non-Solicitation,
Invention Assignment and Arbitration Agreement” (the
Sig Sauer notes that the Agreement contains a
provision addressing Hall’s employment with and termination from
Sig Sauer and a provision that provides all disputes “arising
out of, related to, or resulting from” the Agreement shall be
subject to arbitration.
Hall argues that her claims in this
action are not subject to the arbitration clause in the
When “construing an arbitration clause, courts and
arbitrators must ‘give effect to the contractual rights and
expectations of the parties.’”
Stolt–Nielsen S.A. v.
AnimalFeeds Int’l Corp., 559 U.S. 662, 682 (2010) (quoting Volt
Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior
Univ., 489 U.S. 468, 479 (1989)).
Although there exists a
federal policy favoring arbitration, that policy “does not
totally displace ordinary rules of contract interpretation.”
Paul Revere Variable Annuity Ins. Co. v. Kirschhofer, 226 F.3d
15, 25 (1st Cir. 2000).
Instead, “a court must ascertain
whether: ‘(i) there exists a written agreement to arbitrate,
(ii) the dispute falls within the scope of that arbitration
agreement, and (iii) the party seeking an arbitral forum has not
waived its right to arbitration.’”
Gove v. Career Sys. Dev.
Corp., 689 F.3d 1, 4 (1st Cir. 2012) (quoting Combined Energies
v. CCI, Inc., 514 F.3d 168, 171 (1st Cir. 2008)).
The parties’ dispute centers around whether Hall’s claims
alleged in her complaint fall within the scope of the Agreement.
Sig Sauer argues that Hall’s claims center around her
termination, which is plainly addressed in the Agreement.
disagrees, contending that the claims she asserts in this action
do not come with the arbitration clause’s scope.
Scope of the Arbitration Clause
In determining whether a party’s claims fall within the
scope of an arbitration clause, the court focuses on the factual
allegations underlying the claims in the complaint.
Access Ctr., LLC v. RMS Lifeline, Inc., 638 F.3d 367, 378 (1st
“In carrying out this endeavor, due regard must be
given to the federal policy favoring arbitration, and
ambiguities as to the scope of the arbitration clause itself
resolved in favor of arbitration.”
(internal quotation marks omitted).
Id. at 376 (citing cases)
Thus, in evaluating the
scope of an arbitration clause, “arbitration will be ordered
unless it may be said with positive assurance that the
arbitration clause is not susceptible of an interpretation that
covers the asserted dispute.”
IOM Corp. v. Brown Forman Corp.,
627 F.3d 440, 450 (1st Cir. 2010) (internal quotation marks and
Section 11 of the Agreement, titled “Arbitration,” provides
in relevant part:
In consideration of my employment with the Company and
my receipt of compensation, pay raises and other
benefits paid to me by the Company, at present and in
the future, I agree that any and all controversies,
claims or disputes with the Company arising out of,
relating to, or resulting from this Agreement shall be
subject to binding arbitration under the arbitration
rules set forth in the applicable state rules of civil
procedure or statute.
Doc. no. 4-2 at 3.
Section 7 of the Agreement, titled “Effect
of At-Will Employment,” provides in relevant part:
I understand and agree that I am not employed for any
particular period of time. As an employee at-will, I
am free to terminate my employment, and the Company is
free to terminate my employment at any time, with or
without cause, for any lawful reason. If I cease to
be an employee of the Company for any reason, I will
promptly return to the Company all originals and
copies of any documents, software, equipment, or other
property of any nature belonging to the Company or
containing information about the Company or its
Id. at 2.
Section 7 of the Agreement addresses Hall’s employment with
Sig Sauer, including termination from the company.
As such, her
claims in this action, which are based on the circumstances
surrounding her termination, arise out of, relate to, or result
from the Agreement, and appear to fall squarely within the scope
of the arbitration clause.
See United States ex rel. Hagerty v.
Cyberonics, Inc., 146 F. Supp. 3d 337, 348 (D. Mass. 2015)
(holding that claims alleging retaliatory termination were
within the scope of an agreement providing for arbitration of
claims “arising out of or relating to” plaintiff’s employment
and termination); United States v. Consigli Const. Co., Inc.,
873 F. Supp. 2d 409, 412 (D. Me. 2012) (noting the broad scope
of an arbitration agreement that use the “arising out of, or
relating to” language).
Other Documents Discussing Hall’s Employment
Hall argues that the arbitration clause in the Agreement
should be interpreted to apply to only specific conduct,
including her use of confidential information (Section 3),
intellectual property (Sections 4 and 5), use of company
property (Section 6), solicitation of customers (Section 8),
raiding employees (Section 9), and engaging in transactions for
personal gain (Section 10).
Hall also contends that the
arbitration clause does not apply to sections dealing with the
terms of her employment, which include Section 1 (Exclusive
Services), Section 2 (Compensation and Benefits), the Section
titled “Miscellaneous Provisions,”1 and, relevant here, Section 7
(“Effect of At-Will Employment”).
In support of her interpretation of the arbitration
clause’s limited applicability, Hall contends that her
employment relationship with Sig Sauer is defined by other
These include her signed offer letter, see doc. no.
8-3, and her signed acknowledgement that she received and read
Sig Sauer’s employee handbook, see doc. no. 8-4, both of which
she signed on the same day she signed the Agreement.
contends that because these documents define the scope and terms
Both the “Miscellaneous Provisions” clause and the
arbitration clause are numbered Section 11. This appears to be
of her employment relationship and because they do not
incorporate or refer to the Agreement or its arbitration clause,
the arbitration clause necessarily does not encompass her claims
arising from her termination.
Hall analogizes the facts of this case to those in Zuber v.
Vandalia Research, Inc., No. 3:12-0942, 2012 WL 4928360 (S.D. W.
Va. Oct. 16, 2012).
In Zuber, as in this case, the plaintiff
brought claims against his former employer arising from his
The defendant corporation moved to compel
arbitration, relying on an arbitration provision in the parties’
“Non-Competition, Non-Solicitation, Confidentiality and
Assignment Agreement” (the “Non-Competition Agreement”).
The Non-Competition Agreement provided: “Any and all
disputes or controversies whether of law or fact of any nature
whatsoever arising from or respecting this Agreement shall be
decided by arbitration . . . .”
The court denied the motion to
compel arbitration, noting that the plaintiff had a separate
Employment Agreement, which set forth the terms of the
plaintiff’s employment and termination.
The court found that
plaintiff’s claims were not covered by the Non-Competition
As such, the court held that the arbitration
provision in that agreement did not apply to plaintiff’s claims.
The court’s reasoning in Zuber is not applicable here.
First, the plaintiff in Zuber entered into a separate
“Employment Agreement” that addressed grounds for termination
not mentioned in the Non-Competition Agreement and specifically
provided that disputes concerning the plaintiff’s termination
could be heard in West Virginia state court.
Id. at *3.
to the extent Hall’s offer letter and signed acknowledgement
could constitute an employment agreement with Sig Sauer, they
both include nearly identical language regarding termination of
employment to that contained in Section 7 of the Agreement.
addition, to the extent those documents could constitute an
employment agreement, that agreement does not include a
provision that allows Hall to challenge her termination in court
or otherwise undermine the arbitration clause in the Agreement.
Second, the provision in the Non-Competition Agreement in
Zuber applied only where the plaintiff’s termination resulted
from “the event of default or nonperformance by [plaintiff] of
any of the provisions in this Agreement.”
Id. at *2.
defendant in Zuber conceded that plaintiff’s termination did not
arise from such an event.
Here, however, Section 7 provides
that Sig Sauer can terminate Hall “at any time, with or without
cause, for any lawful reason,” and thereby governs the standard
for termination of employment generally.
For these reasons, Zuber is inapplicable and Hall’s claims
are subject to the arbitration clause.
III. Request to Stay
Sig Sauer requests that the court compel Hall to arbitrate
and stay this matter during the arbitration.
Given that the
issues raised in this action are subject to the arbitration
clause in the Agreement, however, there appears to be no reason
for the court to retain jurisdiction and stay the action.
Therefore, the parties shall have 14 days to show cause why this
action should not be dismissed in light of the court’s order.
Failure to show cause will result in the dismissal of this
For the foregoing reasons, Sig Sauer’s motion to compel
arbitration and stay proceedings (doc. no. 4) is granted to the
extent it seeks to compel Hall to arbitrate the claims she
asserts in this action, but denied to the extent it seeks a stay
of the proceedings during the pendency of the arbitration.
or before January 25, 2017, the parties shall show cause why
this action should not be dismissed in light of this order.
Failure to show cause will result in dismissal of the case.
United States District Judge
January 11, 2018
cc: Counsel of Record
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