Deornellas v. Aspen Square Management, Inc.
| Decision Date | 04 December 2003 |
| Docket Number | No. 03-10147.,03-10147. |
| Citation | 295 F.Supp.2d 753 |
| Parties | Kevin J. DeORNELLAS and Jay B. Greve, Plaintiffs, v. ASPEN SQUARE MANAGEMENT, INC., a Massachusetts domestic profit Corporation; Harold Grinspoon; and Johnson Real Estate Investors, d/b/a Villages of Oscoda, Defendants. |
| Court | U.S. District Court — Eastern District of Michigan |
Kathleen L. Bogas, Eisenberg & Bogas, Bloomfield Hills, MI, for plaintiffs.
Theresa S. Lloyd, Thomas P. Vincent, Jeffrey C. Gerish, Plunkett & Cooney, Bloomfield Hills, MI, for defendants.
ORDER GRANTING MOTION TO STAY PROCEEDINGS AND COMPEL ARBITRATION
The plaintiffs, Kevin J. DeOrnellas and Jay B. Greve, have sued the defendants claiming that they were wrongfully terminated from employment in violation of various Michigan statutes. The defendants responded with a motion to compel arbitration and stay proceedings in this case, which the plaintiffs oppose. The Court heard the arguments of the parties through their respective counsel in open court on November 12, 2003. The Court permitted the parties to file supplemental briefs, which were received on November 21, 2003, and the matter is now ready for decision. The Court now finds that the plaintiffs signed employment documents in which they agreed to arbitrate their disputes with their employer, that the arbitration agreements are, for the most part, valid, and that the offending portions of the arbitration agreements can be severed. The Court will therefore sever the invalid provisions of the arbitration agreements and grant the motion to stay proceedings and compel arbitration.
DeOrnellas and Greve sued Aspen Square Management, Inc.(Aspen), Harold Grinspoon, and Johnson Real Estate Investors (Johnson), doing business as Villages of Oscoda, for wrongful termination. They claim that they were fired in retaliation for reporting environmental violations contrary to Michigan's Whistleblower's Protection Act (WPA), Mich. Comp. Laws § 15.361 et seq., and for filing a claim under the Worker's Disability Compensation Act (WDCA), Mich. Comp. Laws § 418.101 et seq.
Villages of Oscoda is a former military base that is being converted into private residential housing. Aspen is the management company responsible for overseeing the project, and Johnson employs all employees performing work for Aspen on Villages of Oscoda. The plaintiffs were employed by Johnson as members of a construction crew renovating these military housing units on the former Wurtsmith Air Force Base to be sold to the public, although at the time the plaintiffs filed this action there apparently was some uncertainty as to the identity of their employer. The confusion was dispelled, and the Court dismissed Aspen Square Management, Inc. and Harold Grinspoon from the suit based upon a stipulation between the parties, leaving Johnson as the only defendant remaining in the case.
The plaintiffs each signed an employment arbitration agreement (Agreement). The Agreement signed by Mr. DeOrnellas provides as follows:
EMPLOYMENT ARBITRATION AGREEMENT
In consideration of my employment by Johnson Real Estate Investors (the "Partnership"), I, Kevin DeOrnellas, agree with the Partnership as follows:
1. The Partnership's Relationship with Employees: Johnson Real Estate Investors is a general partnership that engages in the business of payroll processing.
2. Arbitration of Disputes: I and the Partnership agree that any legal disputes that occur between myself and the Partnership which (a) arise out of or are related in any way to my employment with the Partnership, my performance of services under this Agreement, or the termination of this Agreement, (b) cannot be resolved informally, shall be resolved exclusively through final and private arbitration before the American Arbitration Association (the "AAA"). Any such arbitration shall be conducted in accordance with the AAA's rules governing the resolution of employment disputes, and with the Partnership's Mandatory Dispute Resolution Policy, a copy of which I have received and reviewed. The Mandatory Dispute Resolution Policy is incorporated herein by reference. The Partnership will designate the location of the AAA facility where the arbitration shall be held and will pay my travel expenses if I must travel more than two and one-half (2.5) hours from my home to reach the designated location. Otherwise, both the Partnership and I will pay our own costs and expenses of any arbitration.
I understand that I still have the right to file a charge against the Partnership with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Massachusetts Commission Against Discrimination, or any other state fair employment practice agency, and that any agency with which I file a charge may investigate that charge. I also understand that, notwithstanding my right to file a charge with an agency, I remain obligated to arbitrate any legal dispute with the Partnership. Any claim I have against the Partnership for damages or other relief (whether or not related to any charge I file) will be arbitrated under this Agreement, and will not be adjudicated in court or by any agency.
3. Termination of Employment: My employment may be terminated by the Partnership or myself at any time with or without cause.
4. Entire Agreement: This Agreement contains the entire and only agreement between me and the Partnership respecting the subject matter hereof, and no modification shall be binding upon me or the Partnership unless made in writing and signed by an authorized representative of the Partnership.
5. Survival of Obligations: My obligations under this Agreement shall survive the termination of my employment with the Partnership, regardless of the manner of or reasons for such termination, and regardless of whether such termination constitutes a breach of this Agreement or of any other agreement I may have with the Partnership. If any provisions of this Agreement or the Partnership's Mandatory Resolution Policy are unenforceable for any reason, the validity of any other provision hereof shall not be affected thereby.
6. Governing Law: This Agreement shall be governed and construed according to the laws of the Commonwealth of Massachusetts, and shall be deemed to be effective as of the first day of my employment by the Partnership. This Agreement is executed under seal.
BY PLACING MY SIGNATURE BELOW, I ACKNOWLEDGE THAT I HAVE READ ALL THE PROVISIONS OF THIS AGREEMENT AND THAT I AGREE TO ALL OF ITS TERMS.
Pls.' Resp. in Opp. to Def.'s Mot. to Compel Arb. Ex. 1, Employment Arbitration Agreements (emphasis added). The Mandatory Dispute Resolution Policy referenced in the Arbitration Agreement provides in relevant part as follows:
Even in the best of companies, employees sometimes find themselves involved in legal disputes with their employer. If this happens at Johnson Real Estate Investors, we want the legal dispute resolved fairly, quickly, and without engaging in the costly and time-consuming process of civil litigation. That is why the Partnership has adopted a dispute resolution process for legal disputes that culminates in final and binding arbitration before a professional, neutral arbitrator.
Arbitration is a method of dispute resolution strongly encouraged by both federal and state law. The United States Supreme Court has endorsed the use of arbitration to resolve individual employee disputes as fundamentally sound and fair. In arbitration, the parties to a dispute appear before a trained, professional arbitrator who takes testimony under oath, listens to the parties' legal arguments, reviews any written submissions, and then renders a legally binding written decision. The process can be completed in a matter of a few months, as opposed to the years frequently consumed in litigating a case in court. The process affords both sides a full and fair opportunity to present witnesses and evidence under oath and to argue the law or the facts on their side to a skilled, neutral decision-maker. Many employers use arbitration as a means of resolving both commercial disputes and disputes with employees.
...
The arbitration provision contained in the Partnership's employment agreement applies only to certain "legal disputes" relating to the employment relationship between the Partnership and its employees. This kind of "legal dispute" means a claim by the employee that the Partnership breached a legal obligation to the employee by violating a statute, regulation, or common law obligation applicable in the employment relationship.
...
The AAA fees for the arbitration, including the filing fee, any transcript fee, the arbitrator's fee, and the associated costs of the arbitration will be divided equally between the parties, except that (a) the Partnership may advance the employee's share of the fees if the employee is unable to pay the fees, and (b) if the arbitrator rules in the employee's favor, the arbitrator may require the Partnership to pay all of the costs of the arbitration other than legal fees.
...
Any demand for arbitration filed more than six (6) months after the event or events giving rise to the legal dispute will be untimely. The arbitrator is to apply federal law or Massachusetts substantive law in deciding the dispute.
If the court should determine that any limitation or other provision of this policy is unlawful or would render the policy unenforceable, then the court should remove that limitation or provision and direct that the arbitration proceed.
The Mandatory Dispute Resolution Policy of Johnson Real Estate Investors, Pls.' Resp. in Opp. to Def.'s Mot. to Compel Arb. Ex. 3 (emphasis added).
On or about February 18, 2003, the plaintiffs were laid off. The plaintiffs, however, contend that the "lay off" was a pretext for a termination that was in fact made in retaliation for the plaintiffs having reported to authorities that the...
To continue reading
Request your trial
-
U.S. v. Stein
...for employment discrimination and therefore violated federal and local anti-discrimination statutes); DeOrnellas v. Aspen Square Mgmt., Inc., 295 F.Supp.2d 753, 763 (E.D.Mich.2003) (portion of arbitration] agreement prohibiting arbitrator from awarding attorney's fees prevailing party would......
-
Cooper v. Mrm Investment Co.
...class's ability to shoulder the costs of arbitration. Morrison, 317 F.3d at 663 (emphasis added); see also DeOrnellas v. Aspen Square Mgmt., 295 F.Supp.2d 753 (E.D.Mich.2003) (holding arbitration agreement's cost-sharing provision unenforceable under The court must evaluate the likely cost ......
-
Killion v. KeHE Distribs.
...in employment agreements. See, e.g., Morrison v. Circuit City Stores, Inc., 317 F.3d 646 (6th Cir.2003); DeOrnellas v. Aspen Square Mgmt., Inc., 295 F.Supp.2d 753 (E.D.Mich.2003). The severability clause here provides (Killion Doc. 71–2 at 9): If any portion of this Agreement is found by a ......
-
Oberhansly v. Ass'n of Better Living & Educ. Int'l
...opportunity to read and understand is bound by its provisions.'" Morris, 2007 WL 674770, at *5 (quoting DeOrnellas v. Aspen Square Mgmt., Inc., 295 F. Supp. 2d 753, 764 (E.D. Mich. 2003)). Thus, "'the failure to read or understand an agreement is not cause for avoiding same.'" Id. (quoting ......