Bhim v. Rent-a-Center, Inc.

• Court: U.S. District Court — Southern District of Florida
• Writing for the Court: K. Michael Moore
• Citation: Bhim v. Rent-a-Center, Inc., 655 F.Supp.2d 1307 (S.D. Fla. 2009)
• Decision Date: 16 September 2009
• Docket Number: Case No. 09-21754-CIV.
• Parties: Pamela BHIM, Plaintiff, v. RENT-A-CENTER, INC., Defendant.

Page 1307

655 F.Supp.2d 1307

Pamela BHIM, Plaintiff, v. RENT-A-CENTER, INC., Defendant.

Case No. 09-21754-CIV.

United States District Court, S.D. Florida.

September 16, 2009.

COPYRIGHT MATERIAL OMITTED

Jason St-Fleur, Jason St-Fleur & Associates, PA, Miami, FL, for Plaintiff.

Alejandro Londono, Littler Mendelson, P.C., Miami, FL, for Defendant.

ORDER STAYING CASE AND REFERRING CLAIMS TO ARBITRATION

K. MICHAEL MOORE, District Judge.

THIS CAUSE came before the Court upon Defendant Rent-A-Center, Inc.'s ("Rent-A-Center") Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(1), (6) or in the Alternative to Stay Proceedings and Compel Arbitration (dkt. # 5). Plaintiff Pamela Bhim ("Bhim") filed a Response (dkt. # 7), and a pleading styled an "Amended Response" (dkt. # 8).¹ Rent-A-Center filed a Reply (dkt. # 9).

UPON CONSIDERATION of the Motion, Response, Reply, pertinent portions of the record, and being otherwise fully advised in the premises, the Court Orders as follows.

I. BACKGROUND

This is a case of alleged employment discrimination. The following facts, which are taken from the Complaint, are not in dispute for purposes of the instant Motion. Rather, the Parties, an employer and its erstwhile employee, contest whether Bhim's claims must be referred to arbitration.

On May 1, 1995, Bhim began working at a RentWays rent-to-own store in Broward County, Florida. Bhim worked her way up, eventually becoming the store's general manager (the Complaint does not specify when). In January of 2002, Jose Grau ("Grau") became the district manager responsible for overseeing Bhim's store. Grau is Hispanic; Bhim is from Trinidad.

On July 26, 2006, the RentWays store where Bhim worked was acquired by the Defendant, Rent-A-Center. Rent-A-Center retained Bhim as the store's general manager. On November 17, 2006, Bhim and a Rent-A-Center representative signed a five-page contract titled "Mutual Agreement to Arbitrate," (the "Arbitration Agreement") which reads in pertinent part as follows:

The Company and I mutually consent to the resolution by arbitration of all claims or controversies ("claims"), past, present or future, including without limitation, claims arising out of or related to my application for employment, assignment/employment, and/or the termination of my assignment/employment that the Company may have against me or that I may have against [Rent-A-Center, its agents, assigns, affiliated entities, or benefit plans].

The only claims that are subject to arbitration are those that, in the absence of this Agreement, would have been justiciable under applicable state or federal law. The claims covered by this agreement include, but are not limited to . . . claims for wages or other compensation due; . . . tort claims for discrimination (including, but not limited to race, sex, sexual harassment, sexual orientation, religion, national origin, age, workers' compensation, marital status, medical condition, handicap or disability); . . . and claims for violation of any federal, state or other governmental law, statute, regulation, or ordinance, except claims excluded in the section of this Agreement entitled "Claims Not Covered by the Agreement."

Arbitration Agreement, Def.'s Ex. A-2 at 1 (dkt. # 5-2). Rent-A-Center states, through its Senior Director of Compensation and Benefits, Steven Spratt, that since July 2000 its company policy has been to require all employees to agree to arbitrate all past, present, and future disputes. See Spratt Decl., Def.'s Ex. A at 1 (dkt. # 5-2).

On March 25, 2008, Rent-A-Center, through Grau, fired Bhim. Bhim subsequently satisfied the prerequisites for commencing the instant lawsuit by filing a charge of employment discrimination with the United States Equal Employment Opportunity Commission within 180 days of her discharge, submitting a Notification of Right to Sue on April 22, 2009, and initiating this action within ninety days of the Notice's receipt. Bhim filed the Complaint in this action (dkt. # 1) on June 25, 2009, alleging that Rent-A-Center fired her because of her national origin, in violation of Title VII of the Civil Rights Act of 1964, as codified at 42 U.S.C. § 2000e-2. Bhim alleges that Rent-A-Center's stated reason for firing her—that her store was poorly managed—was pretextual, and that similarly situated general managers at other stores were not fired.

Rent-A-Center filed the instant Motion on August 17, 2009, arguing that under the terms of the Arbitration Agreement, Bhim's claims must be referred to arbitration. Rent-A-Center asks the Court to dismiss this action or, in the alternative, to stay the proceedings pending the outcome of arbitration. Bhim concedes that she knowingly signed the Arbitration Agreement, and does not contest whether her claims are covered by the Agreement, but counters that the Agreement is void for lack of consideration, and is an unenforceable contract of adhesion. For the following reasons, the Court disagrees with Bhim, and concludes that her claims must be referred to arbitration.

II. ANALYSIS

A. Applicable Law

The validity of an arbitration agreement is governed by the Federal Arbitration Act ("FAA"). See Weeks v. Harden Mfg. Corp., 291 F.3d 1307, 1312-13 (11th Cir. 2002). The FAA provides, in pertinent part, that

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

9 U.S.C. § 2. The FAA further provides:

If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in the proceeding with such arbitration.

9 U.S.C. § 3.

"The FAA establishes a `federal policy favoring arbitration ... requiring that [courts] rigorously enforce agreements to arbitrate.'" Davis v. Prudential Sec, Inc., 59 F.3d 1186, 1192 (11th Cir. 1995) (quoting Shearson/Am. Express Inc. v. McMahon, 482 U.S. 220, 226, 107 S.Ct. 2332, 96 L.Ed.2d 185 (1987)). "`The Arbitration Act establishes that, as a matter of federal law, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration.'" Creative Tile Mktg., Inc. v. SICIS Int'l. S.r.L., 922 F.Supp. 1534, 1538-39 (S.D.Fla.1996) (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth Inc., 473 U.S. 614, 626, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985)). Although the FAA governs the applicability of arbitration agreements, state law governs issues "concerning the validity, revocability, and enforceability of contracts generally." Perry v. Thomas, 482 U.S. 483, 492 n. 9, 107 S.Ct. 2520, 96 L.Ed.2d 426 (1987). Therefore, defenses such as fraud, unconscionability, and duress are governed by state law. See Dale v. Comcast, 498 F.3d 1216, 1219 (11th Cir.2007). Florida law applies here, since the Arbitration Agreement was executed in Florida, Bhim's claims arose in Florida, and the Agreement does not include a contrary choice-of-law provision. See Williams v. Eddie Acardi Motor Co., No. 07-cv-782-J-32JRK, 2008 WL 686222, at *4 (M.D.Fla. March 10, 2008).

The party opposing arbitration "has the affirmative duty of coming forward by way of affidavit or allegation of fact to show cause why the court should not compel arbitration," which is a burden "not unlike that of a party seeking summary judgment." Aronson v. Dean Witter Reynolds, Inc. 675 F.Supp. 1324, 1325 (S.D.Fla.1987) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). Accordingly, Bhim bears the burden here of showing cause why her claims should not be referred to arbitration.

B. This Court Can Determine the Arbitrability of Bhim's Claims

As a threshold matter, the Court must determine whether it may properly rule on the instant dispute. Rent-A-Center argues that the arbitrability of Bhim's claims is itself a question that may only be resolved by the arbitrator, and that therefore this Court may not consider whether the Arbitration Agreement was validly formed. See Def.'s Mot. at 9-11 (dkt. # 7).

Generally, arbitrability is a question for the trial court—and not the arbitrator—unless the parties "clearly and unmistakably" provide otherwise. See First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995). Rent-A-Center argues that the Arbitration Agreement clearly and unmistakably reserved the question of arbitrability for the arbitrator, because the Agreement incorporates the rules of various arbitration services which empower those services to rule on the existence, scope, and validity of the Agreement.² "`When . . . parties explicitly incorporate rules that empower an arbitrator to decide issues of arbitrability, the incorporation serves as clear and unmistakable evidence of the parties' intent to delegate such issues to an arbitrator.'" Terminix Int'l Co. LP v. Palmer Ranch Ltd. P'ship, 432 F.3d 1327, 1332 (11th Cir.2005) (quoting Contec Corp. v. Remote Solution Co., 398 F.3d 205, 208 (2d Cir.2005)). In support of this argument, Rent-A-Center apparently refers to the following portion of the Arbitration Agreement:

The Company and I agree that, except as provided in this Agreement, any arbitration shall be in accordance with the then-current National Employment Arbitration Procedures of the AAA or equivalent (if AAA is designated), the...