Thomas v. PFG Transco, Inc. et al
Filing
51
MEMORANDUM OPINION AND ORDER. It is therefore ORDERED that the parties' Joint Motion to Lift Stay to Reconsider Order Referring Determination of the Gateway Issue of the Arbitrability to Arbitrator (Dkt. 47 ) is GRANTED. The stay ordered on March 25, 2018 is hereby lifted and the parties are permitted to submit briefing on the question whether the arbitration provision is enforceable. Signed by District Judge Amos L. Mazzant, III on 9/9/2019. (baf, )
United States District Court
EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION
FELTON THOMAS,
Plaintiff,
v.
PFG TRANSCO, INC.; PERFORMANCE
FOOD GROUP, INC. D/B/A
PERFORMANCE FOOD GROUP –
CUSTOMIZED DISTRIBUTION, AND
PFGC, INC.,
Defendants.
§
§
§
§
§
§
§
§
§
§
§
Civil Action No. 4:17-CV-00785
Judge Mazzant
MEMORANDUM OPINION AND ORDER
Pending before the Court is the parties’ Joint Motion to Lift Stay to Reconsider Order
Referring Determination of the Gateway Issue of the Arbitrability to Arbitrator (Dkt. #47).
Having considered the Joint Motion in light of the United States Supreme Court’s recent
decision in New Prime Inc. v. Oliveira, 139 S. Ct. 532 (2019), the Court finds that the parties’ Joint
Motion should be GRANTED.
BACKGROUND
I.
Fact Summary
On July 5, 2013, Plaintiff Felton Thomas (“Thomas”) began working as a dispatcher for
Defendant PFG Transco, Inc., working out of the 500 Metro Park Drive, McKinney, Texas
warehouse. According to the terms of Thomas’s employment, the parties agreed to mandatory,
final, and binding arbitration of disputes for on-the-job injuries pursuant to PFG Transco Inc.’s
Texas Injury Benefit Plan (the “Benefit Plan”) as a non-subscriber under the Texas Workers’
Compensation Statute. Thomas signed an acknowledgment of having agreed to mandatory
arbitration of such disputes (Dkt. #7-1, Exhibit 3). Appendix A to the Benefit Plan states:
The Employer hereby adopts a mandatory company policy requiring that the
following claims or disputes must be submitted to final and binding arbitration
under this Appendix: (A) any legal or equitable claim or dispute relating to
enforcement or interpretation of the arbitration provisions in a Receipt, Safety
Pledge and Arbitration Acknowledgement form or this Appendix; and (B) any legal
or equitable claim by or with respect to an Associate for any form of physical or
psychological damage, harm or death which relates to an accident, occupational
disease, or cumulative trauma (including, but not limited to, claims of negligence
or gross negligence or discrimination; claims for intentional acts, assault, battery,
negligent hiring/training/supervision/retention, emotional distress, retaliatory
discharge, or violation of any other noncriminal federal, state or other governmental
common law, statute, regulation or ordinance in connection with a job-related
injury, regardless of whether the common law doctrine was recognized or whether
the statute, regulation or ordinance was enacted before or after the effective date of
this Appendix). This includes all claims listed above that an Associate has now or
in the future against an Employer, its officers, directors, owners, Associates,
representatives, agents, subsidiaries, affiliates, successors, or assigns.
...
The determination of whether a claim is covered by this Appendix shall also be
subject to arbitration under this Appendix. Neither an Associate nor an Employer
shall be entitled to a bench or jury trial on any claim covered by this Appendix.
(Dkt. #7-1, Exhibit 1 at p. 58).
II.
Procedural History
On March 25, 2018, the Court issued a Memorandum Opinion and Order staying further
proceedings against Defendants PFG Transco, Inc., Performance Food Group, Inc., and PFGC,
Inc. (collectively “PFG”) pending the arbitrator’s decision whether Thomas’s claims against PFG
fall within the scope of the arbitration agreement (Dkt. #28). On April 3, 2019, the parties filed a
joint motion to lift the stay (Dkt. #47) in light of the United States Supreme Court’s decision in
New Prime v. Oliveira, 139 S. Ct. 532 (2019).
LEGAL STANDARD
“The Federal Arbitration Act (“FAA”) expresses a strong national policy favoring
arbitration of disputes, and all doubts concerning the arbitrability of claims should be resolved in
favor of arbitration.” Wash. Mut. Fin. Group, LLC v. Bailey, 364 F.3d 260, 263 (5th Cir. 2004).
2
The FAA, “leaves no place for the exercise of discretion by a district court, but instead mandates
that district courts shall direct the parties to proceed to arbitration on issues as to which an
arbitration agreement has been signed.” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218
(1985).
When considering a motion to compel arbitration, the Court must address two questions.
Graves v. BP America, Inc., 568 F.3d 221, 222 (5th Cir. 2009) (citing Fleetwood Enterprises Inc.
v. Gaskamp, 280 F.3d 1069, 1073 (5th Cir. 2002)). “First, whether there is a valid agreement to
arbitrate, and second, whether the dispute in question falls within the scope of the arbitration
agreement.” Id. Concerning the first question of contract validity, the Court should apply
“ordinary state-law principles that govern the formation of contracts.” Id. (citing First Options of
Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 (1995)). The second question of scope is answered
“by applying the ‘federal substantive law of arbitrability . . . .’” Id. (quoting Mitsubishi Motors
Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626 (1985)).
ANALYSIS
The parties jointly request that the Court lift the stay of the present action to reconsider its
determination that the decision whether Thomas’s claims against PFG are arbitrable is for the
arbitrator and not the Court. The parties argue that, according to the United States Supreme Court’s
recent decision in New Prime v. Oliveira, the enforceability of an arbitration clause is a
determination for the district court to make rather than an arbitrator, even when the contract in
question includes a delegation provision. The Court agrees.
New Prime involved a dispute between an interstate trucking company, New Prime, and
one of its drivers, Dominic Oliveira. New Prime, 139 S. Ct. at 536. Mr. Oliveira had agreed to
perform work for New Prime pursuant to an agreement that contained an arbitration clause and a
3
delegation provision giving the arbitrator authority to decide threshold questions of arbitrability.
Id. Eventually, a dispute arose about whether New Prime paid its drivers lawful wages under the
Fair Labor Standards Act, which gave rise to a class action lawsuit against New Prime in federal
district court. Id. In that action, New Prime asked the district court to compel arbitration under
the Federal Arbitration Act (“FAA”) according to the terms of the parties’ agreement. Id.
The district court declined to compel arbitration, holding that despite the delegation clause,
the applicability of the transportation workers exclusion to § 1 of the FAA is a threshold inquiry
for the district court that cannot be delegated to the arbitrator. Id. at 537. The First Circuit agreed.
Id. The Supreme Court then affirmed unanimously, 1 holding that before invoking its statutory
authority under the FAA to stay litigation and order arbitration, the district court must first know
whether the contract itself falls within or beyond the boundaries of §§ 1 and 2. Id.
Here, there is clearly a dispute about whether Thomas’s claims against PFG fall within the
scope of the arbitration agreement. Indeed, the Court recognized as much in its March 25, 2018
Memorandum Opinion and Order (Dkt. #28), declining to take a position on the enforceability of
the arbitration clause and staying the case until the arbitrator made that determination. In light of
New Prime, however, the Court withdraws its determination that the scope of the arbitration clause
with regard to Thomas’s claims against PFG should be determined by the arbitrator; instead, the
Court will resolve the matter itself after appropriate briefing by the parties.
CONCLUSION
It is therefore ORDERED that the parties’ Joint Motion to Lift Stay to Reconsider Order
Referring Determination of the Gateway Issue of the Arbitrability to Arbitrator (Dkt. #47) is
1
The Supreme Court affirmed 8-0, with Justice Kavanaugh taking no part in the consideration or decision of the case.
4
.
GRANTED. The stay ordered on March 25, 2018 is hereby lifted and the parties are permitted to
submit briefing on the question whether the arbitration provision is enforceable.
IT IS SO ORDERED.
SIGNED this 9th day of September, 2019.
___________________________________
AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE
5
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?