Egan v. Regeneron Pharm.

• Decision Date: 10 February 2023
• Docket Number: Civil Action 22-cv-1981(PGS)
• Parties: WINIFRED EGAN AND JENNIFER DUNKLIN-DORAZIO, Plaintiff, v. REGENERON PHARMACEUTICALS INC. MITCHELL MARTIN, INC., VINCENT CANTARELLA, INDIVIDUALLY, AND ELLEN STIEVE, INDIVIDUALLY, Defendants.
• Court: U.S. District Court — District of New Jersey

WINIFRED EGAN AND JENNIFER DUNKLIN-DORAZIO, Plaintiff, v. REGENERON PHARMACEUTICALS INC. MITCHELL MARTIN, INC., VINCENT CANTARELLA, INDIVIDUALLY, AND ELLEN STIEVE, INDIVIDUALLY, Defendants.

Civil Action No. 22-cv-1981(PGS)

United States District Court, D. New Jersey

February 10, 2023

MEMORANDUM AND ORDER

PETER G. SHERIDAN, U.S.D.J.

This matter is before the Court on Defendants' joint motions to dismiss the complaint and to compel arbitration. (ECFs 11 and 12). Oral argument was held on December 7, 2022. The Court has federal question jurisdiction under 28 U.S.C § 1331 since Plaintiffs assert a claim under Federal Labor Standards Act. 29 U.S.C. § 201.

This case arises from an employment dispute among Plaintiffs Winifred Egan (“Egan”) and Jennifer Dunklin-Dorazio (“Dunklin-Dorazio”) and Defendants Mitchell Martin, Inc. (“MMI”) (Plaintiffs' employer); Ellen Stieve (“Stieve”) (manager and/or director at MMI) Regeneron Pharmaceuticals Inc. (“Regeneron”) (MMI's client); and Vincent Cantarella (“Cantarella”) (manager at Defendant Regeneron). (ECF 1, Exhibit A at ¶¶ 1-55). The complaint alleges Defendants violated the New Jersey Wage and Hour Law (“NJWHL”), N.J.S.A. 34:11-56a et seq.; the New Jersey Wage Payment Law (“NJWPL”), N.J.S.A § 34:11-4.1 et seq.; and the Fair Labor Standards Act (“FLSA”). Id. at ¶¶ 223-244. Further, Plaintiffs allegedly suffered retaliation in violation of the FLSA; and the Paid Sick Leave Law (PSLL). Id. at ¶¶ 91, 233-264.

Although the Plaintiffs filed a single complaint and Plaintiffs characterize MMI and Regeneron as “Joint Employers,” the analysis of each Plaintiff's causes of action are treated separately. Despite many overlapping facts, there are different facts, causes of action and damages.

I. Egan Facts

Egan is a New Jersey resident. (ECF No. 1, Exhibit A, Complaint at ¶¶ 4951). Egan was employed by MMI as a Program Manager to perform technical services for its client, Regeneron, from March 18, 2019 through March 19, 2021. (ECF No. 1, Exhibit A Complaint. at ¶ 50; ECF No. 11-3 at 11; ECF No. 11-2 at 11). Egan worked on-site at Regeneron's Basking Ridge, New Jersey location three to four days per week until March 2020. (ECF No. 1, Exhibit A, Complaint at ¶¶ 60-61). Thereafter, she worked exclusively from her home in New Jersey because of the COVID shutdown. Id.

MMI is a staffing agency providing its clients with information technology services. Id. at ¶ 28. MMI is incorporated in New York with a principal place of business in Manhattan, and a location in Woodbridge, New Jersey. Id. at ¶¶ 19-21. Defendant Regeneron is incorporated in New York with a principal place of business in Tarrytown, New York and a location in Basking Ridge, New Jersey. Id. at ¶¶ 7-9.

Egan and MMI executed an Employee Services Agreement (“Egan Agreement”) that includes a mediation and arbitration paragraph (discussed below). (ECF No. 11-3). Regeneron is mentioned in the Egan Agreement but is not a party thereto.

The complaint alleges Stieve, a manager at MMI, informed Egan that she would rarely be required to work overtime; but if she worked overtime, she would be appropriately compensated. (ECF No. 1, Exhibit A, Complaint at ¶ 82). Regeneron's representative Cantarella allegedly required Egan to work many overtime hours without compensation and directed Egan not to record such hours on her timesheets. Id. at ¶¶ 83-88. Moreover, Cantarella warned her that if such hours were recorded, the timesheet would be rejected and would not be paid by MMI and Regeneron. Id. Egan estimated that she worked 703 unpaid overtime hours on Regeneron work. Id. at ¶ 98. Egan alleges she complained to Stieve regarding the unpaid overtime, and lack of sick leave while working at the Regeneron location, but no assistance was offered by Stieve. Id. at ¶ 106.

At some point, Egan requested paid sick leave due to a heart condition, and she informed her coworkers of their rights to sick leave. Id. at ¶¶ 117-218. Evidently, this spurred others to request sick leave pursuant to PSLL. Id. at ¶¶ 217218. Egan alleges MMI and Regeneron blamed her for the additional requests. Id. at ¶¶ 217-220. In addition, Egan recorded and submitted overtime hours. As a result, Cantarella informed MMI that Egan submitted incorrect timesheets related to her sick leave and overtime hours. In response, Egan was eventually fired. Id. at ¶¶ 122-144.

Egan alleges that Regeneron discriminated and harassed her due her absence for her heart condition. Id. at ¶¶ 117-218. She further alleges that Regeneron and MMI (a) forced her to work significant overtime hours during her recuperation period, and required her to maintain a strict deadline schedule without consideration of her recuperation; (b) denied her excused compensation time to attend follow-up doctor's appointments; and (c) interrogated her about her alleged incorrect timesheets related to her leave. Id. at ¶¶ 117-146.

Egan alleges that MMI and Regeneron were joint employers because both exercised control over (1) rules and conditions of employment including those involving hiring, firing and discipline; (2) issuing work assignments to plaintiffs and (3) supervising plaintiffs' day-to-day activities. Id. at ¶¶ 71-74. Further, Egan alleges that both Cantarella and Stieve were actively involved in managing the day-to-day operations of Regeneron and MMI. Id. at ¶¶ 33-44. Cantarella and Stieve had power over personnel decisions, including hiring and firing, setting wages and otherwise had control over terms and conditions of employment. Id. at ¶¶ 32-42. Moreover, Cantarella and Stieve determined whether employees were paid for all hours worked, including overtime. Id. at ¶¶ 33-43.

As noted above, Egan and MMI entered into the Egan Agreement. (ECF No. 11-3, at 1-4; See also ECF No. 1, Exhibit A at ¶ 58). The Egan Agreement is signed by both parties on the last page, and each individual page is initialed at the bottom by Egan and a representative of MMI. (ECF No. 11-3, ¶¶ 1-12). As previously noted, Regeneron is not a signatory to the Egan Agreement.

The Egan Agreement incorporates 21 paragraphs plus a term sheet. The pertinent paragraphs are highlighted below:

1) The term sheet identifies Regeneron as the client of MMI, and Egan was assigned to Regeneron's Basking Ridge, New Jersey facility. It also includes her pay rate ($100.00 per hour). (ECF No. 11-3, p. 11-14).

2) The Resolution of Disputes Mediation/Arbitration (Paragraph 17) is at issue herein. Egan and MMI agreed that all employment disputes “arising out of this [Egan] Agreement or performance of services” shall be submitted to mediation and arbitration (ECF No. 11-3, p. 7-8). In addition, paragraph 17 requires that each party must (1) initiate a claim within 15 days of the event; (2) waive a right to a jury trial; and (3) waive the right to sue for punitive and exemplary damages. Id. In another subsection, there is a choice of law provision wherein the Egan Agreement is governed by the laws of New York with a “deference to federal law,” and should be “conducted [in accord with] the Federal Arbitration Act.” Id. Finally, there is a poorly drafted non-severability clause based on the interpretation of the Egan Agreement may provide that if any provision of Paragraph 17, as a whole, is deemed unenforceable, then Paragraph 17 cannot be enforced.

II.

“The Third Circuit has established a two-tiered framework for assessing motions to compel arbitration.” Lloyd v. Retail Equation, Inc., No. CV 21-17057, 2022 WL 18024204 at *4 (D.N.J. Dec. 29, 2022); See Guidotti v. Legal Helpers Debt Resolution, L.L.C., 716 F.3d 764, 776 (3d Cir. 2013). “Where it is apparent on the face of the complaint, or in documents relied upon in the complaint, that the claims at issue in the case are subject to arbitration, the case is considered pursuant to the motion to dismiss standard as applied under Fed.R.Civ.P. 12(b)(6).” Guidotti, 716 F.3d 774-76 (2013) (citing Somerset Consulting, LLC v. United Capital Lenders, LLC, 832 F.Supp.2d 474, 482 (E.D.Pa.2011). “If the complaint and its supporting documents are unclear regarding the agreement to arbitrate, or if the plaintiff has responded to a motion to compel arbitration with additional facts sufficient to place the agreement to arbitrate in issue, then ‘the parties should be entitled to discovery on the question of arbitrability before a court entertains further briefing on [the] question.'” Id. After limited discovery, the court may entertain a renewed motion to compel arbitration under a summary judgment standard (Fed. R. Civ. P. 56). Id. Here, the Court proceeds on the motion to dismiss standard.

III.

“The “principal purpose” of the FAA is to ‘ensur[e] that private arbitration agreements are enforced according to their terms.'” AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 344 (2011) (citing Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior Univ., 489 U.S. 468, 478 (1989).

Under Section 3 of the FAA, a party may apply to a federal court for a stay of the trial of an action “upon any issue referable to arbitration under an agreement in writing for such arbitration.” 9 U.S.C. § 3. Therefore, the Court may compel a party to arbitrate where it failed to comply with an agreement to arbitrate, and to stay proceedings in any matter subject to arbitration. Romanov v. Microsoft Corp., No. CV 21-03564, 2021 WL 3486938, at *3 (D.N.J. Aug. 9, 2021) (citing 9 U.S.C. §§ 2-4). Thus, there are two questions in determining this motion to compel: (1) whether a valid agreement to arbitrate exists and (2) whether the dispute at issue falls within the scope of the agreement. Century Indem. Co. v. Certain Underwriters at Lloyd's, 584 F.3d 513, 523 (3d Cir. 2009) (citing Kirleis v. Dickie, McCamey & Chilcote,...