GIUFFRE v. NORTH AMERICAN SPINE, LLC. et al

Filing 91

MEMORANDUM OPINION AND ORDER granting 65 Motion staying claims asserted by Plaintiff against Athas Healthcare; etc. Signed by Magistrate Judge Leda D. Wettre on 3/2/17. (sr, )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

CARMELO JOHN GIUFFRE,

Civil Action No.

Plaintiff,

16-1641 (MCA) (LDW)

v.
NORTH AMERICAN SPINE LLC et
a!.,

MEMORANDUM OPINION
AND ORDER

Defendants.

Before the Court is a motion by defendant Athas Healthcare, LLC, doing business and
impleaded as North American Spine (“Athas”), to stay the claims of plaintiff Carmelo John Giuffre
against it.

(ECF No. 65).

Plaintiff opposes this motion (ECF Nos. 69, 90), and defendant

Hackensack Surgery Center, LLC (“Hackensack Surgery”) partially opposes it to the extent that
discovery relating to its cross-claim against Athas would be stayed (ECF No. 6$).

Having

considered the parties’ submissions, for the reasons set forth herein, and for good cause shown,
the motion is GRANTED as to Plaintiffs claims against Athas pending resolution of the action to
compel arbitration of Plaintiffs claims against Athas that is sub judice before the United States
District Court for the Northern District of Texas.

I. Background and Motion
Plaintiff commenced this action in the Superior Court of New Jersey, Bergen County, Law
Division, on February 22, 2016, alleging that spinal surgery he underwent on February 21, 2014
caused him injury.

(Cmplt., ECF No. 1-1).

His Complaint asserted claims against various

defendants, each of whom had a role in the underlying treatment, for medical malpractice,
fraudulent misrepresentation, and detrimental reliance.’ (Id). On March 24, 2016, Athas removed
the action to this Court on diversity grounds. (ECF No. 1). Various other defendants have asserted
defense, contribution, and indemnity cross-claims against their co-defendants, including Athas.
(See ECF Nos. 37, 63, 64, 66, 73, 7$).
The Court, by a September 1, 2016 Order, granted Athas leave to file a motion to stay this
proceeding in conjunction with a motion it represented it would file in the United States District
Court for the Northern District of Texas seeking to compel arbitration. (ECf No. 5$). Athas
shortly thereafter filed a motion to stay this matter pursuant to

§

3 of the federal Arbitration Act.

(ECF No. 65).
Athas argues that this action should be stayed against it under the Federal Arbitration Act
because Plaintiffs claims against it purportedly fall within the scope of a clause of a contract
between it and Plaintiff requiring resolution of any disputes by binding arbitration before the
American Arbitration Association in Dallas, Texas. (See Br. in Supp., ECF No. 65-2). Athas
additionally takes the position that because the federal Arbitration Act requires a motion to compel
arbitration to be filed in the district in which compulsory arbitration is sought, this Court should
conduct only a threshold analysis of the arbitration clause’s enforceability, reserving a full
substantive analysis for adjudication in an action to compel arbitration before the United States
District Court for the Northern District of Texas. (ECF No. 65-2 at 13—14).
Plaintiff opposes the stay motion, characterizing the contract containing the arbitration
clause as an unenforceable contract of adhesion, as procedurally and substantively unconscionable,

Plaintiff filed a first Amended Complaint adding an additional doctor as a defendant on
September 20, 2016. (ECF No. 61). Plaintiffs amendments are immaterial to the Court’s
analysis of this motion.
2

and as no longer effective under its own terms. (See Br. in Oppo., ECF No. 69). Hackensack
Surgery partially opposes the motion, objecting to any stay affecting its cross-claims pending
against Athas. (See Br. in Partial Oppo., ECf No. 6$).
On february 1, 2017, Athas filed a complaint before the United States District Court for
the Northern District of Texas seeking an order compelling arbitration under

§

4 of the federal

Arbitration Act. Athas Health, LLC v. Giuffre, Civ. A. No. 17-300-L (N.D. Tex.).

Upon this

Court’s request that Plaintiff update its position on the stay in view of the recent filing of the action
to compel arbitration in Texas, Plaintiff filed an additional letter brief outlining his opposition to
the stay motion on February 10, 2017, which again argued that the arbitration clause in question
is ttnenforceable. (Letter Br., ECf No. 90).

II. Analysis

Athas, in seeking a stay under

§ 3 of the federal Arbitration Act, asks the Court to conduct

what would amount to a preliminary analysis of a contractual clause that it contends requires
Plaintiff to arbitrate his claims against Athas. The enforceability of this clause is the central issue
in the action to compel arbitration that Athas recently filed in the Northern District of Texas.
Compi., Athas Health, LLC, Civ. A. No. 17-300-L, ECF No. 1 (N.D. Tex.).
Addressing the parties’ arguments regarding the enforceability of the arbitration clause
would seemingly preempt the role of the Northern District of Texas in determining whether to
compel Plaintiff and Athas to resolve their dispute by arbitration.2 Making some preliminary

2

Under the terms of § 4 of the federal Arbitration Act, only a judge in the Northern District of
Texas could compel the parties to arbitrate in Dallas, as Athas claims the arbitration clause
requires. See 9 U.S.C. § 4; Hautz Constr., LLC v. H & MDep ‘t Store, Civ. A. No. 12-3478
(fLW), 2012 WL 5880370, at *16_is (D.N.J. Nov. 20, 2012); Lester v. Gene Express, Inc., Civ.
3

finding of enforceability, as Athas asks the Court to do, is not in this Court’s view appropriate
when the identical issue is now pending before the Northern District of Texas, which is the proper
Court to rule on the arbitrability of the claims between Plaintiff and Athas. Consequently, the
issue of granting a

§

3 stay is contingent on a finding of enforceability by the Northern District of

Texas.3
Nevertheless, the Court may also stay a matter pursuant to its inherent power to manage its
docket. Landis v. N Am. Co., 299 U.S. 248, 254—55 (1936); Nicholas v. Wyndham Int’l, Inc., 149
F. App’x 79, $1 (3d Cir. 2005). A discretionary stay of the claims between Plaintiff and Athas
pending a decision by the Northern District of Texas is, in this Court’s view, eminently appropriate.

Ill.

Conclusion

For the reasons stated above, the motion by defendant Athas Healthcare, LLC, impleaded
as North American Spine, LLC, to stay Plaintiffs claims against it (ECF No. 65) is GRANTED
and the claims asserted by Plaintiff against Athas Healthcare, LLC are subject to a discretionary
stay pending resolution of the action Athas Healthcare LLC v. Giuffre, Civ. A. No. 1 7-300-L,
before the United States District Court for the Northern District of Texas; and
Athas Healthcare, LLC shall notify the Court within five business days of any resolution
of or substantial event in the action Athas Healthcare LLC v. Giuffre, Civ. A. No. 17-300-L, before
the United States District Court for the Northern District of Texas; and

A. No. 09-403 (RBK), 2009 WL 3757155, at *6, * (D.N.J. Nov. 10, 2009); Josko v. New World
Sys. Coip., Civ. A. No. 05-4013 (RBK), 2006 WL 2524169, at *10 (D.N.J. Aug. 29, 2006).
If the Northern District of Texas compels Plaintiff and Athas to arbitrate, it is clear that a
stay of Plaintiffs claims against Athas would be justified.
4

§

3

The Clerk of the Court shall terminate the motion filed as ECF No. 65.
IT IS, on this 2nd day of March, 2017, SO ORDERED.

iion. Leda Dunn Weifre
United States Magistrate Judge
Original:
cc:

Clerk of the Court
Hon. Madeline Cox Arleo, U.S.D.J.
All Parties

5