Bulkenstein v. Taptu Inc et al
Filing
28
OPINION re: 13 MOTION to Compel Arbitration and Dismissing or Staying the action filed by David Wightman, Eric Rosenberg, Taptu, Inc., Mediafed Ltd., Ben Nichols, Ashley Harrison, 6 MOTION to Compel Arbitration and D ismiss or Stay Proceedings filed by David Wightman, Eric Rosenberg, Ben Nichols, Ashley Harrison, Taptu Inc. Based on the conclusions set forth below, the Defendants' motion is granted, the Plaintiff is directed to arbitrate, and this action is stayed. It is so ordered. (See Order.) (Signed by Judge Robert W. Sweet on 10/9/2014) (ajs)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-----------------------------------------x
DANA LOREN BULKENSTEIN,
14 Civ. 1812
Plaintiff,
OPINION
-againstTAPTU, INC., d/b/a or f/k/a MEDIAFED
and/or MEDIAFED, LTD., ASHLEY HARRISON,
DAVID WIGHTMAN, ERIC ROSENBERG,
and BEN NICHOLS,
Defendants.
I
A P P E A R A N C E S:
USDCSDJ\rv
DOCUMENT
ELECTRONICP.J_IY FILED
DOC#:
DATE FILED~
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Attorneys for Plaintiff
CARTER PEK, P.C.
387 Grand Street, Suite K-203
New York, NY 10002
By: Matthew A. Pek, Esq.
Attorneys for Defendants
BINGHAM MCCUTCHEN LLP
399 Park Avenue
New York, NY 10022
By:
Douglas T. Schwarz, Esq.
Yasmin Fernandez-Acuna, Esq.
---------------------------------------
Sweet, D.J.
Defendants Taptu, Inc., d/b/a or f/k/a Mediafed and/or
Mediafed, Ltd.
("Taptu"), Ashley Harrison ("Harrison"), David
Wightman ("Wightman"), Eric Rosenberg ("Rosenberg") and Ben
Nichols ("Nichols")
(collectively, the "Defendants") have moved
pursuant to Federal Rule of Civil Procedure 12(b) (6) and 9
U.S.C. §§ 3 & 4 to compel plaintiff Dana Loren Bulkenstein
("Bulkenstein" or "Plaintiff") to proceed to arbitration and to
dismiss or stay this action.
Based on the conclusions set forth
below, the Defendants' motion is granted, the Plaintiff is
directed to arbitrate, and this action is stayed.
Prior Proceedings
Taptu and Bulkenstein entered into a letter employment
agreement dated September 4, 2013 (the "Agreement") containing
the following arbitration clause:
You and the Company shall submit to mandatory and
exclusive binding arbitration of any controversy
or claim arising out of, or relating to, this
Agreement or any breach hereof, provided,
however, that the parties retain their right to,
and shall not be prohibited, limited or in any
other way restricted from, seeking or obtaining
equitable relief from a court having jurisdiction
over the parties.
Such arbitration shall be
1
governed by the Federal Arbitration Act and
conducted through the American Arbitration
Association in the State of California, San
Francisco County, before a single neutral
arbitrator, in accordance with the National Rules
for the Resolution of Employment Disputes of the
American Arbitration Association in effect at
that time.
The parties may conduct only
essential discovery prior to the hearing, as
defined by the 'AAA arbitrator.
The arbitrator
shall issue a written decision that contains the
essential findings and conclusions on which the
decision is based.
You shall bear only those
costs of arbitration you would otherwise bear had
you brought a claim covered by this Agreement in
court.
Judgment upon the determination or award
rendered by the arbitrator may be entered in any
court having jurisdiction thereof.
(Schwarz Deel. Ex. 1-A
~
6.)
On March 14, 2014, Plaintiff filed a complaint in this
action alleging several federal and state anti-discrimination
law violations arising out of her employment with Taptu, Inc.
On May 27, 2014, Defendants filed a Motion to Compel Arbitration
and Dismiss or Stay Proceedings.
On or about June 13, 2014,
Plaintiff submitted an Amended Complaint
("AC") alleging seven
additional causes of action.
The AC alleges eleven counts:
( 1) violations of the
Americans with Disabilities Act of 1990 (the "ADA")
to accommodate;
for failure
(2) violations of the ADA for unlawful disparate
2
-------------------------------------
treatment;
(3) violations of the New York State Human Rights Law
for disability discrimination;
(4) violations of the New York
City Human Rights Law for disability discrimination;
conversion;
(5)
(6) tortious interference with existing and
prospective economic relations;
(7) misappropriation of
confidential and protected trade secret information;
fraudulent inducement and fraudulent solicitation;
and deceptive trade practices;
(8)
(9) unfair
(10) unjust enrichment; and (11)
prima facie tort.
The instant motion was marked fully submitted on
August 22, 2014.
The Applicable Standard
On a motion to dismiss pursuant to Rule 12 (b) ( 6), all
factual allegations in the complaint are accepted as true, and
all inferences are drawn in favor of the pleader.
Polar Molecular Corp., 12 F.3d 1170, 1174
Mills v.
(2d Cir. 1993).
However, "a plaintiff's obligation to provide the grounds of his
entitlement to relief requires more than labels and
conclusions."
(2007)
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555
(internal quotation marks omitted) .
3
A complaint must
- ---------
---------------
contain "sufficient factual matter, accepted as true, to 'state
a claim to relief that is plausible on its face.'"
Iqbal, 556 U.S.
662,
663
(2009)
Ashcroft v.
(quoting Twombly, 550 U.S. at
570) .
A claim is facially plausible when "the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged."
550 U.S. at 556).
Iqbal,
556 U.S. at 663
(quoting Twombly,
In other words, the factual allegations must
"possess enough heft to show that the pleader is entitled to
relief."
Twombly, 550 U.S. at 557
(internal quotation marks
omitted).
The Agreement To Arbitrate Is Enforced
When determining whether parties have agreed to
arbitrate a dispute, courts consider two questions:
(1) whether
a valid agreement to arbitrate under the contract in question
exists and (2) whether the particular dispute in question falls
within the scope of that arbitration agreement.
See Hartford
Accident & Indem. Co. v. Swiss Reins. Am. Corp., 246 F.3d 219,
4
--·
-----··---------
226 (2d Cir. 2001)
-------------
(quoting National Union Fire Ins. Co. v.
Belco Petrol. Corp., 88 F.3d 129, 135 (2d Cir. 1996)).
Arbitration is "strictly a matter of contract."
v. American Express Co., 478 F.3d 96, 99 (2d Cir. 2007)
Thomson-CSF, S.A. v. Am. Arbitration Ass'n,
Cir. 1995)).
As set forth above,
Ross
(citing
64 F.3d 773, 779 (2d
Plaintiff and Defendant Taptu,
Inc. entered an employment agreement with an arbitration
provision explicitly stating that, "any controversy or claim
arising out of, or relating to, this Agreement or any breach
hereof" would be submitted to "mandatory and exclusive binding
arbitration."
(Schwarz Deel. Ex. 1-A
~
6.)
In accordance with the strong federal policy favoring
arbitration, "doubts as to whether a claim falls within the
scope of [the arbitration agreement] should be resolved in favor
of arbitrability."
Hartford, 246 F.3d at 226 (citing Moses H.
Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25
( 1983)) .
Courts in this circuit have held that, where a valid
arbitration clause has been found to exist, they must abstain
from adjudicating employment discrimination claims
5
(Counts 1-4)
(see generally Ragone v. Atlantic Video at Manhattan Ctr., 595
F.3d 115 (2d Cir. 2010)); conversion claims
Collections LLC v. Costco Wholesale Corp.,
Cir. 2012)); tortious interference claims
DiBello v. Salkowitz, 772 N.Y.S.2d 663,
Bimota SPA v. Rousseau,
(Count 5)
(see Ipcon
698 F.3d 58,
(Count 6)
665
64
(2d
(see, e.g.,
(1st Dep't 2004) and
628 F. Supp. 2d 500, 505
(S.D.N.Y.
2009)); misappropriation of trade secret information claims
(Count 7)
(see McMahan Sec. Co. v.
F.3d 82, 88-89
(Count 8)
Cashing,
Forum Capital Mkts 1. P.,
(2d Cir. 1994)); fraudulent inducement claims
(see Ipcon,
698 F.3d at 61
(quoting Buckeye Check
Inc. v. Cardegna, 546 U.S. 440,
trade practices claims
445
(2006))); unfair
(see Ipcon,
(Count 9)
unjust enrichment claims
698 F.3d at 64);
(Count 10)
(see Robinson Brog Leinwand
Greene Genovese & Gluck P.C. v. Quinn & Assoc. LLP,
App'x 761, 764
(Count 11)
35
523 Fed.
(2d Cir. 2013)); and prima facie tort claims
(see, e.g., Landis v.
Civ. 0187, 2000 WL 546985, *4
Finova Capital Corp., No. 00
(S.D.N.Y. May 3, 2000)).
The parties agreed to conduct the arbitration through
the American Arbitration Association ("AAA")
and "in accordance
with the National Rules for the Resolution of Employment
Disputes of the
1-A
~
6)
[AAA]
in effect at that time"
(Schwarz Deel. Ex.
and "a party who signs a contract containing an
6
arbitration clause and incorporating by reference the AAA rules
. cannot [later] disown its agreed-to obligation to
arbitrate all disputes, including the question of
arbitrability."
Lismore v.
Soci~t~
G~n~rale
Energy Corp., No.
11 Civ. 6705, 2012 WL 3577833, *5 (S.D.N.Y Aug. 17, 2012)
(quoting Contee Corp. v. Remote Solutions, Ltd., 398 F.3d 205,
208
(2d Cir. 2005))
(emphasis in original).
Plaintiff has contended that a proviso in the
Agreement permits a party to "seek []
[and] obtain [] equitable
relief from a court," and that therefore she is not obligated to
arbitrate her damages claims against Defendants.
Opp'n 2.)
(See Pl.' s
The Agreement requires that the parties "submit to
mandatory and exclusive binding arbitration of any controversy
or claim arising out of, or relating to, this Agreement or any
breach hereof."
(Schwarz Deel. Ex. 1-A
~
6.)
This language "is
Collins & Aikman Products Co.
the paradigm of a broad clause."
v. Building Systems, Inc., 58 F.3d 16, 20
(2d Cir. 1995).
Where
there is a broad arbitration clause, "there arises a presumption
of arbitrability" of claims.
See id. at 23.
The proviso is applicable where, as here, the parties'
agreement includes restrictive covenants relating to
7
confidentiality and non-competition.
Here, the Plaintiff's
action is essentially for legal, not equitable, relief.
count of the AC seeks money damages.
87; 90,
Every
(Ac crrcrr 76-77; 81-82; 85,
92; 97; 103; 112; 122-123; 125, 127-128; 132-134; 138.)
Indeed, the AC demands "a total sum of $325,000 from Defendants
to settle the matter once and for all."
(AC 11 62. )
Plaintiff's
request for relief "permanently enjoining defendants from
committing any act which constitutes conduct" [sic],
37
(see AC 11
(prayer for relief "b.")) does not alter her action seeking
money damages.
Each of Plaintiff's claims relates to her employment
relationship with Defendants, and therefore to the Agreement.
Counts 1-4, alleging unlawful discrimination under the ADA, the
New York Human Rights Law, and the New York City Human Rights
Law, can only be pled by Plaintiff in her capacity as an
employee and against Defendants as employer(s).
Count 5,
alleging conversion, relates to "Plaintiff's personal
possessions and routine and customary work-place appropriate
effects [which allegedly] were made available for use by
Defendants and [allegedly] became critical business tools of
Defendants."
(AC 11 94.)
Counts 6 and 7, alleging tortious
interference with existing and prospective economic relations
8
and misappropriation of confidential and protected trade secret
information, are based on the allegation that Plaintiff's former
immediate supervisor and manager sent Plaintiff an e-mail
requesting client information.
Count 8, alleging fraudulent
inducement and fraudulent solicitation, is based on alleged
breaches of the Agreement.
Count 9, alleging unfair and
deceptive trade practices, directs the reader to the facts and
allegations previously recited in the earlier counts.
Count 10,
alleging unjust enrichment, is based on Plaintiff's alleged
"hard work and professional web consulting services afforded [to
Defendants]."
(AC~
130.)
Count 11, alleging prima facie tort,
simply repeats Plaintiff's previous allegations of
discrimination, fraud, and intentional theft or destruction of
client relationships.
(AC
~
136.)
Plaintiff therefore is compelled to arbitrate her
claims.
See Ramasamy v. Essar Global Ltd., 825 F. Supp. 2d 466,
471 (S.D.N.Y. 2011).
9
The Action Is Stayed
The FAA contemplates staying an action where claims
are arbitrable and the arbitrators could conclude the Count 10,
the unjust enrichment claim, nominally an equitable claim, is
within the exemption language.
In any case, a stay during
arbitration is appropriate.
It is so ordered.
New York, NY
October
2014
t( ,
W. SWEET
U.S.D.J.
10
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