Matala-De-Mazza v. Special Touch Home Care Services, Inc. et al

Filing 34

ORDER granting 31 Motion to Compel Arbitration. These proceedings are stayed pending arbitration. Ordered by Judge Allyne R. Ross on 10/31/2016. (Matsumura, Rebecca)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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X
:
LOUBOV MATALA-DE MAZZA, INDIVIDUALLY
:
AND ON BEHALF OF ALL OTHER PERSONS
:
SIMILARLY SITUATED WHO WERE EMPLOYED BY :
SPECIAL TOUCH HOME CARE SERVICES, INC., AND :
STEVEN OSTROVSKY,
:
:
Plaintiffs,
:
:
-against:
:
SPECIAL TOUCH HOME CARE SERVICES, INC., AND X
STEVEN OSTROVSKY,

16-CV-1185 (ARR)(RLM)
NOT FOR ELECTRONIC
OR PRINT PUBLICATION
OPINION & ORDER

Defendants.
--------------------------------------------------------------------ROSS, United States District Judge:
On January 8, 2016, plaintiff Loubov Matala-de Mazza (“Matala-de Mazza”),
individually and as class representative, brought this action in New York State Supreme Court
against her employer, defendant Special Touch Home Care Services, Inc. and its owner and
executive director Steven Ostrovsky (collectively “Special Touch”), alleging several violations
of New York law. See Compl., ECF No. 1-1. 1 Defendants removed this action to federal court
on February 8, 2016. Notice of Removal, ECF No. 1. Plaintiffs moved to remand. See Mem. in
Supp. of Pls.’ Mot. to Remand, ECF No. 18-2. This motion was denied on June 3, 2016. June 3,
2016 Op. and Order, ECF No. 24. On September 7, 2016, Special Touch moved to dismiss or
compel arbitration based on the arbitration provisions of a collective bargaining agreement
(“CBA”) executed between plaintiffs’ union, 1199 SEIU United Healthcare Workers East

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Plaintiffs’ allegations are summarized in more detail in my June 3, 2016 Opinion and
Order, ECF No. 24.

(“1199”) and Special Touch. See Mem. of Law in Supp. of Defs.’ Mot. to Dismiss or, in the
Alternative, to Compel Arbitration, ECF No. 31-1 (“Defs.’ Mem.”). For the reasons set forth
below, arbitration is compelled.
The Federal Arbitration Act (“FAA”) requires federal courts to enforce valid arbitration
agreements. See 9 U.S.C. §§ 2-3; Katz v. Cellco P’ship, 794 F.3d 341, 344 (2d Cir. 2015)
(“Under the [FAA], a district court must stay proceedings if satisfied that the parties have agreed
in writing to arbitrate an issue or issues underlying the district court proceeding.”) (quoting
McMahan Sec. Co. v. Forum Capital Mkts., 35 F.3d 82, 85-86 (2d Cir. 1994)); Genesco, Inc. v.
T. Kakiuchi & Co., Ltd., 815 F.2d 840, 844 (2d Cir. 1987) (same). Because the FAA is
mandatory, a court petitioned to compel arbitration is limited to addressing four questions:
1) whether the parties agreed to arbitrate; 2) whether the claims at issue fall within the scope of
the agreement; 3) if federal statutory claims are asserted, whether Congress intended such claims
to be nonarbitrable; and 4) if not all claims are found to be arbitrable, whether to stay litigation
pending the outcome of arbitration. JLM Indus., Inc. v. Stolt-Nielsen SA, 387 F.3d 163, 169 (2d
Cir. 2004); Genesco, 815 F.2d at 844 (citing Mitsubishi Motor Corp. v. Soler ChryslerPlymouth, 473 U.S. 614, 626 (1985)).
Defendants have shown a valid arbitration agreement and that the instant action falls
within the scope of that agreement. The named plaintiff and all class members are members of
1199, which, since 2005, has had a collective bargaining agreement governing the employment
relationship between plaintiffs and Special Touch. Decl. of Evan Ostrovsky, ECF No. 31-2
(“Ostrovsky Decl.”), at ¶¶ 2-3. This agreement has been modified and extended by several
memoranda of agreement (“MOA”) and letter agreements. Id. ¶¶ 4-5, 7, 9-11. On February 1,
2016, 1199 signed a memorandum of agreement that added a provision requiring plaintiffs to

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submit certain claims to a specified mediation and arbitration process. Ostrovsky Decl. Ex. E,
ECF No. 31-7 (“2016 MOA”). The 2016 MOA was subsequently ratified by 1199’s
membership. Ostrovsky Decl. ¶ 10; Supp. Decl. of Evan Ostrovsky, ECF No. 33-1 (“Ostrovsky
Supp. Decl.”), at ¶ 2; Ostrovsky Supp. Decl. Ex. A, ECF No. 33-2 (letter from 1199 stating that
“the 1199 members of Special Touch Home Care Service, Inc. ratified the contract”). 2 Thus,
there is a valid agreement to arbitrate between the parties.
The 2016 MOA contains the following arbitration clause:
[A]ll claims brought by either the Union or Employees, asserting violations of or
arising under the Fair Labor Standards Act (“FLSA”), New York Home Care
Worker Wage Parity Law, or New York Labor Law (collectively, the “Covered
Statutes”), in any manner, shall be subject exclusively, to the grievance and
arbitration procedures described in this Article.
2016 MOA at 4. This agreement plainly covers the plaintiffs’ claims, which arise under the New
York Labor Law and the New York Home Care Worker Wage Parity Law. See, e.g., Compl. ¶¶
74-77, 87; see also Lai Chan v. Chinese-Am. Planning Council Home Attendant Program, Inc.,
No. 15-cv-9605 (KBF), 2016 U.S. Dist. LEXIS 73039, at *1 (S.D.N.Y. Feb. 3, 2016)
(compelling arbitration of a dispute between another 1199 member and her employer based on
the same arbitration clause).

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“[E]vidence proffered by [defendants], unless impeached or effectively countered, is
sufficient to establish” any facts required to show entitlement to arbitration. Oppenheimer &
Co., Inc. v. Neidhardt, 56 F.3d 352, 357 (2d Cir. 1995). “Although [plaintiffs have] repeatedly
uttered general denials of [defendants’] contentions, [they] offered no evidence casting doubt on
the accuracy of [defendants’] evidence or on the inference from this evidence that” the 2016
MOA was ratified by 1199’s membership. Id. I therefore rely on the declarations and letter
provided by defendants to establish the factual predicate necessary to show a valid agreement to
arbitrate. See also McAllister v. East, 611 Fed. App’x 17, 20 (2d Cir. 2015); General Media, Inc.
v. Shooker, No. 97 Civ. 510 (DAB), 1998 WL 401530, at *6 (S.D.N.Y. Jul. 16, 1998) (citing,
e.g., Manning v. Energy Conversion Devices, Inc., 833 F.2d 1096, 1103 (2d Cir. 1987)) (“To put
the ‘making’ of a contract sufficiently in question to avoid arbitration, the party opposing
arbitration has the burden of showing that there is a triable issue.”).
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The arbitration agreement limits the agreement’s applicability to “the period covered by
the CBA.” 2016 MOA at 5. The parties dispute whether 1199 and Special Touch intended this
period to extend back to the effective date of the original CBA signed between 1199 and Special
Touch, or to apply only from the effective date of the 2016 MOA forward. Pls.’ Mem. at 4-5;
Defs.’ Reply Mem. of Law in Further Supp. of their Mot. to Dismiss or, in the Alternative,
Compel Arbitration, ECF No. 33, at 8-11. If plaintiffs are correct that the temporal limitation
clause in the 2016 MOA limits its applicability to future disputes, most of their claims will not
fall within the scope of the arbitration clause. See Pls.’ Mem. of Law in Opp’n to Defs.’ Mot. to
Dismiss or Compel Arbitration, ECF No. 32 (“Pls.’ Mem.”), at 4-5.
However, it is not necessary to resolve the temporal scope of the arbitration agreement at
this time. The strong federal policy in favor of arbitration requires courts to “compel arbitration
‘unless it may be said with positive assurance that the arbitration clause is not susceptible of an
interpretation that covers the asserted dispute.’” Collins & Aikman Prods. Co. v. Bldg. Sys.,
Inc., 58 F.3d 16, 19 (2d Cir. 1995) (quoting David L. Threlkeld & Co. v. Metullgesellschaft Ltd.,
923 F.2d 245, 250 (2d Cir. 1991). See also Arrigo v. Blue Fish Commodities, Inc., 408 F. App'x
480, 481 (2d Cir. 2011) (quoting Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460
U.S. 1, 24–25 (1983)) (“Any doubts concerning the scope of arbitrable issues should be resolved
in favor of arbitration” including where “the problem at hand is the construction of the contract
language itself.”).
Here, the 2016 MOA defines “CBA” as follows:
WHEREAS, SPECIAL TOUCH HOME CARE SERVICES, INC. (the
“Employer”) and 1199SEIU United Healthcare Workers East (the “Union”) are
party to a collective bargaining agreement, dated November 1, 2005, as amended
by Memoranda of Agreement (“MOA”) including those effective January 1, 2011,
December 9, 2011, and July 1, 2014 (collectively, the “CBA”)[.]

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2016 MOA at 1. The arbitration agreement is therefore “susceptible of an interpretation that
covers the asserted dispute.” Collins, 58 F.3d at 19 (quoting Threlked, 923 F.2d at 250).
Arbitration is therefore compelled with respect to all claims. The parties may argue the proper
construction of the temporal limitation clause before the arbitrator. See Prudential Lines, Inc. v.
Exxon Corp., 704 F.2d 59, 63-64 (2d Cir. 1983) (quoting McAllister Bros., Inc. v. A &S Transp.
Co., 621 F.2d 519, 522 (2d Cir. 1980)) (“If the arbitration clause is broad . . . arbitration should
be compelled and the arbitrator should decide any claim that the arbitration agreement, because
of . . . temporal limitations, does not cover the underlying dispute.”).
Finally, plaintiffs argue that the named plaintiff, Matala-de Mazza, cannot afford her
share of the fees and expenses of the arbitrator “and therefore would have no legal remedy,”
rendering the arbitration agreement unenforceable. Pls.’ Mem. at 6; see also 2016 MOA at 5
(providing that “fees and expenses of the Mediator/Arbitrator shall be shared equally between
the employee and employer.”). Defendants counter that the fee-sharing provision was amended
by a June 23, 2016 side letter agreement providing that “[t]he fees and expenses of the
Mediator/Arbitrator shall be borne solely by the Employer in any mediation and/or arbitration
commenced by the Employee.” Ostrovsky Decl. Ex. G, ECF No. 31-9 (“June 2016 SLA”), at 2;
see also Defs.’ Reply at 13.
“[A] party seek[ing] to invalidate an arbitration agreement on the ground that arbitration
would be prohibitively expensive . . . bears the burden of showing the likelihood of incurring
such costs.” Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79, 92 (2000). Matala-de
Mazza argues that “[t]he average cost of arbitrating an employment claim is $20,000” and she
“only earns approximately $220 per week.” Pls.’ Mem. at 7. These assertions do not meet her
burden. Matala-de Mazza did not “show[] . . . individualized prohibitive expense,” as required to

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meet her burden under Green Tree, nor did she provide any information regarding “the cost
differential between arbitration and litigation in court.” Valle v. ATM National, LLC, No. 14cv-7993, 2015 WL 413449, at *6 (S.D.N.Y. Jan. 30, 2015) (quoting Brady v. Williams Capital
Group, L.P., 878 N.Y.S.2d 693, 698 (N.Y. App. Div. 2009), aff’d 928 N.E.2d 383 (2010)). Nor
has Matala-de Mazza shown a “likelihood of incurring such costs,” given the provision of the
June 2016 SLA providing that defendants will bear the full cost of arbitration. 3 See Damato v.
Time Warner Cable, Inc., No. 13-cv-994, 2013 WL 3968765, at *11 (E.D.N.Y. Jul. 31, 2013)
(rejecting unconscionability challenge where “plaintiffs ha[d] not provided any evidence about
their financial situations” and “ha[d] not conclusively established that they will be subject to the
fees” plaintiffs challenged. 4
Plaintiffs do not argue that the statutes under which they bring their claims are
categorically exempted from mandatory arbitration. See also Lai Chan, 2016 U.S. Dist. LEXIS
73039, at *6-7 n.3.
The Second Circuit requires district courts to stay proceedings after all claims have been

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At this stage, such a showing may not be possible. It is unclear whether an arbitrator
would decide that the fee-sharing provision even applies, given the June 2016 SLA.
Interpretation of the various amendments to the CBA is a matter for the arbitrator to decide.
Baldeo v. Darden Restaurants, Inc., No. 04-cv-2185, 2005 WL 44703, at *7 (E.D.N.Y. Jan. 11,
2005) (“[District court] review is limited to the gateway issue of whether there is a valid
arbitration agreement.”); Ciago v. Ameriquest Mortgage Co., 295 F.Supp.2d 324, 330 (S.D.N.Y.
2003) (“This is not to say, however, that all of the provisions to which plaintiff objects are valid.
It is unclear at this point how the arbitrator will interpret the [disputed] provisions. Once this
Court determines that the parties have agreed to arbitrate, the validity and meaning of specific
provisions within the Agreement to arbitrate is a matter entirely for the arbitrator to decide.”).
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If plaintiff does arbitrate this dispute and is charged with costs, she may seek federal
court review of the costs at that time. See Musnick v. King Motor Co. of Fort Lauderdale, 325
F.3d 1255, 1261 (11th Cir. 2003) (“Should [plaintiff] not prevail, he may incur liability for costs
and fees. If he believes that liability is excessive or that it deprives him of his statutory remedy,
he may seek judicial review.”).
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referred to arbitration and a stay requested. Katz, 794 F.3d at 345. Plaintiffs have requested a
stay. Pls.’ Mem. at 8. Therefore, this action will be stayed pending arbitration.
CONCLUSION
For the preceding reasons, the motion to compel arbitration is granted. These
proceedings are stayed pending arbitration.
SO ORDERED.

__________/s/____________________
Allyne R. Ross
United States District Judge

Dated:

October 31, 2016
Brooklyn, New York

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