Bell v. Arise Virtual Sols.

• Decision Date: 24 February 2022
• Docket Number: 4:21-cv-00538-RK
• Parties: DONNA BELL, INDIVIDUALLY AND ON BEHALF OF SIMILARLY SITUATED INDIVIDUALS; Plaintiff, v. ARISE VIRTUAL SOLUTIONS, INC., Defendant.
• Court: U.S. District Court — Western District of Missouri

DONNA BELL, INDIVIDUALLY AND ON BEHALF OF SIMILARLY SITUATED INDIVIDUALS; Plaintiff,
v.
ARISE VIRTUAL SOLUTIONS, INC., Defendant.

No. 4:21-cv-00538-RK

United States District Court, W.D. Missouri, Western Division

February 24, 2022

ORDER

ROSEANN A. KETCHMARK, JUDGE

Now before the Court are (1) Plaintiff Donna Bell's motion for conditional class certification pursuant to 29 U.S.C. § 216(b) (Doc. 2), and (2) Defendant Arise Virtual Solutions, Inc.'s motion to compel arbitration and stay these proceedings (Doc. 13). The motions are fully briefed. (Docs. 14, 22, 26, 28, 34, 35.) In addition, the parties provided supplemental briefing as requested by the Court (Doc. 39). (Docs. 40, 41, 42.) For the reasons below, the Court ORDERS as follows:

(1) Defendant Arise's motion to compel arbitration as to Plaintiff Bell's claims is GRANTED and Plaintiff Bell's claims are STAYED pending arbitration, and

(2) Plaintiff Bell's motion for conditional class certification pursuant to § 216(b) is DENIED as moot

I. Background

In a Complaint filed July 27, 2021, Plaintiff alleges Defendant Arise misclassified Plaintiff and other “Customer Support Professionals” as independent contractors when in reality, under federal law, they are employees of Defendant. (See Doc. 1 at 1.) Plaintiff alleges she and other Customer Support Professionals work from their homes or other remote locations and provide customer service for Defendant's clients by telephone. By classifying Customer Support Professionals like Plaintiff as “Independent Business Owners” or agents of Independent Business Owners, Bell alleges Defendant Arise unlawfully avoids paying them minimum wage, requires them to pay for training and other necessary expenses to perform their work, and does not pay them for extensive training time. (Id. at 1-2.)

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II. Discussion

A. Preliminary Issues

The procedural posture of this case as it has developed raises a preliminary procedural issue the parties have squarely placed before the Court. The day after filing her complaint against Defendant, Plaintiff filed a motion for conditional certification. (Doc. 2). Defendant was not served until August 10, 2021, and its answer was therefore not due until August 31, 2021. (See Doc. 4.) On August 31, 2021, Defendant filed its answer and motion to compel arbitration and stay proceedings, along with a motion for extension of time to file a response to Plaintiff's motion for conditional certification. (Docs. 13, 15, 16.) On September 14, 2021, the parties jointly filed a stipulated briefing schedule to fully brief both pending motions. (Doc. 23.) The following day, the Court entered an order setting a briefing schedule for both motions pursuant to the parties' joint stipulation. (Doc. 24.)

In their briefing as to both motions, each party argues the motion it filed should be decided first. Plaintiff argues h er motion f or conditional certification must be decided first, and should the motion be granted and notice issued, Defendant's motion to compel should be decided later at the “second stage” of conditional certification. Defendant disagrees and argues its motion to compel Plaintiff to arbitration of her claim must be decided first because arbitrability is a threshold issue.

It does not appear the Eighth Circuit has specifically addressed the issue the parties first place before the Court: when a motion for conditional certification under the FLSA and a motion to compel arbitration as to the sole named plaintiff are simultaneously pending, should one necessarily be decided before the other?

At least one other Circuit Court of Appeals has undertaken to answer this question. In doing so, the Fifth Circuit held by presenting a “threshold question, ” a motion to compel arbitration as to the sole named plaintiff must be decided prior to a plaintiff's motion for conditional class certification . Reyna v. Int'l Bank of Commerce, 839 F.3d 373, 376-77 (5th Cir. 2016); see Edwards v. Doordash, 888 F.3d 738, (5th Cir. 2018) (holding district court did not err in ruling on defendant's motion to compel arbitration before ruling on plaintiff's motion for conditional certification). Other district courts that have addressed this question generally agree. See, e.g., Gillespie v. Cracker Barrel Old Country Store Inc., No. CV-21-00940-PHX-DJH, 2021 WL 5280568, at *1-2 (D. Ariz. Nov. 12, 2021); Leitzke v. JPMorgan Chase Bank, N.A.,

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No. 8:19-cv-2174-T-33AEP, 2020 WL 8669703, at *3-4 (M.D. Fla. Jan. 27, 2020); Green v. U.S. Xpress Enters., Inc.. 434 F.Supp.3d 633, 638 n.3 (E.D. Tenn. Jan. 17, 2020); Doe #1 v. Déjà Vu Consulting Inc., No. 3:17-cv-00040, 2017 WL 3837730, at *8 (M.D. Tenn. Sept. 1, 2017) (recognizing “courts generally consider the motion to compel arbitration first and, then, if the motion to compel is denied, whether conditional certification is appropriate” and holding defendant's motion to compel arbitration must take precedence, denying plaintiff's motion to hold defendant's motion to compel arbitration pending plaintif f's motion f or conditional certification) (collecting cases); see also Bryant v. Toppers Int'l, Inc., No. 3:20-CV-61 (CDL), 2021 WL 299253 (M.D. Ga. Jan. 28, 2021) (granting defendant's motion to compel arbitration while plaintiff's motion for conditional certification was pending); Ferrell v. SemGroup Corp., No. 19-CV-00610-GKF-JFJ, 2020 WL 8836056, at *1-2 (N.D. Okla. April 22, 2020) (granting defendant's motion to stay briefing as to any motion for conditional certification until defendant's motion to dismiss and compel arbitration is resolved); Thompson v. Body Sculpt Int'l, LLC, No. 18-cv-1001-A RR-GRB, 2018 WL 3235545, at *3-8 (E.D.N.Y. July 2, 2018) (deciding defendant's motion to compel prior to plaintiff's motion for conditional certification and finding as moot plaintiff's motion for conditional certification upon granting defendant's motion to compel arbitration); Fears v. Auto Reflections, Inc., No. 1:17-cv-2632-TCB, 2018 WL 4846531, at *1 (N.D.Ga. Feb. 8, 2018) (rejecting plaintiff's argument that defendant's motion to compel arbitration was premature because plaintiff's had not yet moved for class certification and the deadline for doing so had not yet passed); but see Monplaisir v. Integrated Tech Grp., LLC, No. C 19-01484 WHA, 2019 WL 3577162 (N.D. Cal. Aug. 6, 2019) (granting plaintiff's motion for conditional certification and holding defendant's motion to compel arbitration in abeyance pending the running of the opt-in period); Brooks v. C.H Robinson Int'l, Inc., No. 4:16-cv-00939-761-HFS, 2017 WL 10506772 (W.D. Mo. May 9, 2017) (granting plaintiff's motion to stay consideration of defendant's motion to compel arbitration pending a ruling on plaintiff's motion for conditional certification).

In arguing that the Court should consider Plaintiff's motion for conditional certification first and to allow notice to be sent to potential opt-in plaintiffs prior to resolving Defendant's motion to compel arbitration, Plaintiff argues the issue of arbitration is a “merits-b ased determination that should be addressed at the second stage of the conditional certification process.” (Doc. 28 at 6.) Many of the cases on which Plaintiff rely in support of this proposition, however, only consider the existence of an arbitration agreement in the context of deciding a motion for

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conditional certification (i.e., whether an arbitration agreement is a basis to deny a motion for conditional certification)^[1] and whether notice should be issued to include potential opt-in plaintiff-employees identified as having signed arbitration agreements.^[2] Courts in this district generally agree with this great weight of authority as to these limited circumstances that are different from the threshold question in this case. See Vallone v. CJS Sols. Grp., LLC, 437 F.Supp.3d 687, 692 (D. Minn. 2020) (declining to deny conditional certification because some plaintiffs signed arbitration agreements); Grove v. Meltech, Inc., No. 8:20CV193, 2020 WL 7133568, at *4 (D. Neb. Dec. 3, 2020) (noting in ruling on plaintiff's motion for conditional certification, “[t]he defendants' only argument against the conditional certification motion is based on arbitration clauses of the plaintiffs' and potential conditional collective class members' contracts”); Davis v. NovaStar Mortg., Inc., 408 F.Supp.2d 811, 817-18 (W.D. Mo. Nov. 8, 2005) (rejecting defendant's argument that conditional certification is improper because of the existence of arbitration agreements); see also Haworth v. New Prime, Inc., 448 F.Supp.3d 1060, 1074-75 (W.D. Mo. Mar. 23, 2020) (rejecting defendant's argument to exclude from receiving notice of conditional certification those it identified as signing an arbitration agreement because defendant failed to satisfy the standard set forth in Bigger v. Facebook, Inc., 947 F.3d 1043, 1050

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(7th Cir. 2020) and In re JPMorgan Chase & Co., 916 F.3d 494, 502-03 (5th Cir. 2019) for excluding arbitration employees from conditional certification notice).

The Court finds persuasive the Fifth Circuit's reasoning in Reyna and the cases su p po rting the Reyna ruling. Additionally, the Court finds the cases on which Plaintiff relies are inapposite and not persuasive in the context of this case. The Court will therefore rule on Defendant's motion to compel arbitration first.^[3]

B. Defendant Arise's Motion to Compel Arbitration

Section 2 of the Federal Arbitration Act (FAA), its primary substantive provision, states:

A written provision in . . . a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.

9 U.S.C. § 2. “Under § 3, a party may apply to a federal court for a stay of the trial of an action...