Bynum v. Maplebear Inc.
| Decision Date | 12 February 2016 |
| Docket Number | 15–CV–6263 |
| Citation | 160 F.Supp.3d 527 |
| Parties | Melody Bynum, Plaintiff, v. Maplebear Inc., d/b/a Instacart, Defendant. |
| Court | U.S. District Court — Eastern District of New York |
Melody Bynum, represented by Abdul Karim Hassan, Abdul Hassan Law Group, PLLC, 215–28 Hillside Avenue, Queens Village, NY 11427, 718–740–1000, Fax: 718–740–2000, Email: abdul@abdulhassan.com.
Maplebear Inc., doing business as Instacart, represented by Alice Keeney Jump, Reavis Parent Lehrer LLP, 41 Madison Avenue, 41st Floor, New York, NY 10010, Email: ajump@rpl-law.com, Benjamin W. Berkowitz, Nikki Vo, Ryan Wong, Keker & Van Nest LLP, 633 Battery Street, San Francisco, CA 94111, Email: bberkowitz@kvn.com, Email: nvo@kvn.com, Email: rwong@kvn.com.
JACK B. WEINSTEIN
, Senior United States District Judge:
Table of Contents
This case asks the question whether the court can sever unconscionable portions of an arbitration agreement with respect to venue and assessments of legal fees and costs and then order arbitration under the purged agreement. This memorandum and order supports an affirmative answer.
Plaintiff Melody Bynum initiated this action against defendant Maplebear Inc., doing business as Instacart (“Instacart”), on October 30, 2015. Alleged is that she was misclassified as an independent contractor and was not paid overtime wages in violation of the Fair Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”). See generally Compl., Oct. 30, 2015, ECF No. 1 (“Compl.”).
On December 15, 2015, defendant moved to compel arbitration. See Notice of Def.'s Mot. to Compel Arbitration, Dec. 15, 2015, ECF No. 10. It argues that there is a valid arbitration agreement between the parties which requires plaintiff to resolve her wage claims through binding arbitration administered by JAMS (a national private organization providing arbitration services). See generally Mem. of Law in Supp. of Def.'s Mot. to Compel Arbitration, Dec. 15, 2015, ECF No. 13 (“Def.'s Mem.”).
Plaintiff opposes the motion. She contends that FLSA claims are not arbitrable. She seeks additional time to complete discovery on whether there was a valid arbitration agreement. See generally Pl.'s Mem. of Law in Opp. to Def.'s Mot. to Compel Arbitration, Jan. 5, 2016, ECF No. 29 (“Pl.'s Mem.”).
An evidentiary hearing was conducted on February 8, 2016. See Hr'g Tr., Feb. 8, 2016 (“Hr'g Tr.”). Following the parties' stipulation to sever the arbitration agreement's venue and fee-related clauses, defendant's motion to compel was orally granted. Federal law requires enforcement of valid agreements to arbitrate. Without the objectionable venue and fee provisions, the arbitration agreement entered into between the parties is valid.
Plaintiff's testimony as well as the available documentation shows that she received, read and signed the employment contract, which included an agreement to arbitrate. Plaintiff has not argued that she did not understand what she read, or that she did not provide the signature on the contract. She had a reasonable opportunity to examine the arbitration agreement and understand it; there was no overreaching by defendant in presenting the arbitration clause to her.
Plaintiff's dispute over wages and the terms of her employment falls within the broad scope of the arbitration agreement. For the reasons stated on the record and in this memorandum, the case is stayed pending arbitration in New York in accordance with section 3 of the Federal Arbitration Act (“FAA”).
Instacart is a technology company founded in 2012 and headquartered in San Francisco, California. Decl. of Heather Wake in Supp. of Def.'s Mot. to Compel Arbitration, Dec. 15, 2015, ECF No. 11 (“Wake Decl.”), at ¶ 2. Through the use of a “communications and logistics platform,” Instacart “facilitate[s] connections between customers who wish to purchase grocery items and individuals who are willing to shop for the groceries and/or deliver the groceries to the customers (called ‘Personal Shoppers').” Id . at ¶ 3. The Instacart platform is used in several cities including San Francisco, Denver, Philadelphia, and New York. Id . at ¶ 5. Instacart has operated in New York since March 2014. Id .
Customers can create a user account with Instacart and place an online order for groceries from retail stores such as Safeway, PETCO, Costco, Whole Foods Market, and others. Id . at ¶ 6. They can also specify whether they want the groceries delivered and the time for delivery. Id. Instacart's proprietary communications and logistics technology then connects customers with Personal Shoppers, who are tasked with completing the order. Id. at ¶ 7.
Plaintiff Melody Bynum is a resident of Queens County, New York. Compl. at ¶ 7. According to the complaint, she worked for defendant as a Personal Shopper from October 2014 to on or about October 7, 2015, performing delivery work within New York. Id . at ¶¶ 11–12.
Plaintiff entered into an Independent Contractor Agreement (“Agreement”) with Instacart on October 15, 2014, after applying for the position of Personal Shopper through the Instacart website. Wake Decl. at ¶¶ 9, 12, Ex. A.
In order to become a Personal Shopper, an applicant clicks on a link available on the front page of the Instacart website which says “Become a Shopper.” Id. at ¶ 8. Clicking on the “Become a Shopper” link takes the applicant to the application section of Instacart's website. The application includes a description of a Personal Shopper's expected tasks (purchasing or delivering groceries, or both), required qualifications, an overview of the application process, and a link that says “Apply Now!” to begin the application. Id. Each applicant is required to electronically sign an Independent Contractor Agreement as part of his or her application. Id. at ¶ 9, Ex. A.
HelloSign, an electronic signature service, manages Instacart's Independent Contractor Agreements with Personal Shoppers. Id. at ¶ 10. According to defendant, HelloSign uses IP addresses and other identifying data to maintain a time-stamped audit trail that tracks when each Personal Shopper applicant receives, views, and submits each Agreement. Id. An applicant is permitted to electronically sign the Agreement after passing various security measures. Id. HelloSign's website represents that the company complies with the U.S. Electronic Signature in Global and National Commerce Act of 2000 (“E–SIGN”) regarding electronic signatures and transmissions. Id. at ¶ 11.
It is argued by defendant, without contradiction, that according to HelloSign's audit data, Bynum reviewed the Agreement on three separate days—October 9, 14, and 15, 2014—prior to signing it. See id. at Ex. A, Audit Trail. After signing the Agreement and submitting her application, plaintiff received a copy of her completed application, including the signed Agreement. Id. at ¶ 13. She then began performing Personal Shopper services for Instacart. Id. at ¶ 14.
According to the Agreement, a Personal Shopper is engaged by Instacart to perform “[s]hopping and delivery services” for its customers. Id. at Ex. A, § 1 and Ex. A. Personal Shoppers are paid by Instacart pursuant to the following fee schedule:
For each “batch” of orders picked, contractor will receive the greater of $5 (five dollars) per batch or 50 (fifty) cents per item picked. Contractor will receive an additional commission of $5 per order delivered. Contractor will also receive an additional twenty five cents per batch if he or she wears an “Instacart” shirt while picking the batch and delivering all orders comprised of that batch. The contractor will be charged $0.25/batch for use of the app.
Id. at Ex. A, § 2 and Ex. A. Under section 2 of the Agreement, Personal Shoppers “shall be responsible for all expenses incurred or necessary in the performance of [shopping and delivery services], including but not limited to telephone, mailing, and travel expenses.” Id. at Ex. A, § 2.
The Agreement contains a section entitled “DISPUTE RESOLUTION.” See id. at Ex. A, § 7. Section 7.1 states:
Following the full opportunity to discuss and negotiate over this dispute resolution procedure, the Parties agree that to the fullest extent permitted by law, any controversy, dispute or claim arising out of or relating to the Services performed by the Contractor, this Agreement, the breach, termination, interpretation, enforcement, validity, scope and applicability of any such agreement, or any allegations of discrimination or harassment on any basis under federal, state, or local law, which could otherwise be heard before any court of competent jurisdiction (a “Dispute”), shall be submitted to and determined exclusively by binding arbitration. The Parties agree that a Dispute arising under any law that requires resort to an administrative agency may be brought before such agency as permitted by law, and that after exhaustion of administrative...
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