Floyd v. Kelly Servs., Inc.
| Decision Date | 30 August 2019 |
| Docket Number | Case No. 3:18-cv-2247-K |
| Parties | REBEKAH FLOYD, Plaintiff, v. KELLY SERVICES, INC., Defendant. |
| Court | U.S. District Court — Northern District of Texas |
Before the Court is Defendant's "Motion to Dismiss and Compel Individual Arbitration." ECF No. 12. For the reasons stated, the Court should GRANT the Motion and DISMISS this civil action without prejudice to Plaintiff's right to demand arbitration of her claims.
Defendant Kelly Services, Inc. (Kelly) is an office and workforce solutions staffing company. Compl. 3 (ECF No. 1). On October 2, 2017, Kelly hired Plaintiff Rebekah Floyd as a temporary catastrophe property claims adjuster for AON Insurance. Id. Though Plaintiff performed work for AON, Kelly employed and paid Plaintiff from approximately October 2, 2017, to December 10, 2017. Id. On August 24, 2018, Plaintiff filed her Complaint asserting claims against Kelly under the Fair Labor Standards Act ("FLSA"). Id. 1. Plaintiff's Complaint avers that it is "[a] collective action lawsuit on behalf of [Plaintiff] and all other similarly situated employees to recover unpaid regular and overtime wages from Defendant Kelly Services, Inc." Id. Kelly moves to dismiss Plaintiff's Complaint under Federal Rule of Civil Procedure 12(b)(3) and to compel Plaintiff to arbitrate her claims individually, pursuant to an Arbitration Agreement between the parties. See Mot. The Motion is fully briefed and ripe for determination.
Kelly moves to dismiss Plaintiff's Complaint and compel arbitration under Rule 12(b)(3). Under Rule 12(b)(3), claims may be dismissed for improper venue. Fed. R. Civ. P. 12(b)(3). "The United States Supreme Court has described an arbitration agreement as a 'specialized kind of forum-selection clause.'" Wheeler v. Dollar Tree Stores, Inc., 2017 WL 3426300, at *2 (W.D. La. Aug. 8, 2017) (). Thus, the enforceability of an arbitration agreement may be analyzed under Rule 12(b)(3). Id.; see also McDonnel Grp., L.L.C. v. Great Lakes Ins. SE, UK Branch, 923 F.3d 427, 430 n.5 (5th Cir. 2019) () (citing Noble Drilling Servs., Inc. v. Certex USA,Inc., 620 F.3d 469, 472 n.3 (5th Cir. 2010); Lim v. Offshore Specialty Fabricators, Inc., 404 F.3d 898, 902 (5th Cir. 2005)).
The Fifth Circuit has not ruled on which party bears the burden on a Rule 12(b)(3) motion, but "most district courts within this circuit have imposed the burden of proving that venue is proper on the plaintiff once a defendant has objected to the plaintiff's chosen forum." Galderma Labs., L.P. v. Teva Pharm. USA, Inc., 290 F. Supp. 3d 599, 605 (N.D. Tex. 2017) (citing cases); see also Victory Renewables, LLC v. Energy Trading Co., 2019 WL 2539209, at *3 (N.D. Tex. Feb. 8, 2019), adopted by 2019 WL 2540738 (N.D. Tex. Mar. 6, 2019). When deciding a Rule 12(b)(3) motion, the court must accept as true all allegations in the complaint and resolve all conflicts in favor of the plaintiff. Braspetro Oil Servs. Co. v. Modec (USA), Inc., 240 F. App'x 612, 615 (5th Cir. 2007) (per curiam) (citations omitted). The court may consider evidence in the record beyond the facts alleged in the complaint and its proper attachments. Ambraco, Inc. v. Bossclip B.V., 570 F.3d 233, 238 (5th Cir. 2009) (citations and internal quotation marks omitted) ("[T]he court may find a plausible set of facts by considering any of the following: (1) the complaint alone; (2) the complaint supplemented by the undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts."). "Absent an evidentiary hearing on a Rule 12(b)(3) motion, affidavits and other evidence submitted by the non-moving party are viewed in the light most favorable to that party." Mem'l Hermann HealthSys. v. Blue Cross Blue Shield of Tex., 2017 WL 5593523, at *4 (S.D. Tex. Nov. 17, 2017) (citing Ambraco, 570 F.3d at 238).
The agreement at issue in this case expressly states: "This Agreement shall be governed by the Federal Arbitration Act." Def.'s App. 7 (ECF No. 14-1). The Federal Arbitration Act (FAA) codifies a national policy favoring arbitration. AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011) (citing Moses H. Cone Mem'l Hospital v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983)); see also Mun. Energy Agency of Miss. v. Big Rivers Elec. Corp., 804 F.2d 338, 342 (5th Cir. 1986) (citing Southland Corp. v. Keating, 465 U.S. 1 (1984)). Under § 2 of the FAA, "[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; see also Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63, 67 (2010). "The FAA reflects the fundamental principle that arbitration is a matter of contract." Rent-A-Ctr., 561 U.S. at 67. It "places arbitration agreements on an equal footing with other contracts . . . and requires courts to enforce them according to their terms." Id. (internal citations omitted). Under § 4 of the FAA, parties aggrieved by another party's failure to arbitrate a claim pursuant to a written arbitration agreement "may petition a federal court 'for an order directing that such arbitration proceed in a manner provided for in such agreement.'" Id. at 68 (quoting 9 U.S.C. § 4). Once the courtis "satisfied that the making of the agreement for arbitration or the failure to comply therewith is not in issue," it "'shall' order arbitration." Id. (quoting 9. U.S.C. § 4).
"Courts perform a two-step inquiry to determine whether parties should be compelled to arbitrate a dispute." Will-Drill Res., Inc. v. Samson Res. Co., 352 F.3d 211, 214 (5th Cir. 2003). The court must first determine "'whether the parties agreed to arbitrate the dispute,'" and second, the court must determine "'whether any federal statue or policy renders the claims nonarbitrable.'" Id. (quoting R.M. Perez & Assocs., Inc. v. Welch, 960 F.2d 534, 538 (5th Cir. 1992)). The first inquiry involves answering two questions: "(1) whether there is a valid agreement to arbitrate between the parties; and (2) whether the dispute in question falls within the scope of that arbitration agreement." Id. (quoting Am. Heritage Life Ins. Co. v. Lang, 321 F.3d 533, 538 (5th Cir. 2003)) (internal quotation marks omitted). "'Although there is a strong federal policy favoring arbitration, [that policy] does not apply to the determination of whether there is a valid agreement to arbitrate between the parties.'" Moran v. Ceiling Fans Direct, Inc., 239 F. App'x 931, 936 (5th Cir. 2007) (per curiam) (quoting Will-Drill Res., 352 F.3d at 214). However, when an arbitration agreement contains a delegation clause "giving the arbitrator the primary power to rule on the arbitrability of a specific claim, the analysis changes." Kubala v. Supreme Prod. Servs., Inc., 830 F.3d 199, 201 (5th Cir. 2016) (citing First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 942 (1995)). If the party seeking arbitration points to a purported delegation clause, then the court analyzeswhether a valid agreement exists; if it finds a valid agreement exists, "the only question . . . is whether the purported delegation clause is in fact a delegation clause—that is, if it evinces an intent to have the arbitrator decide whether a given claim must be arbitrated." Id. at 202 (citing Rent-A-Ctr., 561 U.S. at 68-69). "If there is a delegation clause, the motion to compel arbitration should be granted in almost all cases." Id.1
When "a dispute is subject to mandatory . . . arbitration procedures, . . . the proper course of action is usually to stay the proceedings pending arbitration." Ruiz v. Donahoe, 784 F.3d 247, 249 (5th Cir. 2015) (citing 9 U.S.C. § 3; Williams v. Cigna Fin. Advisors, Inc., 56 F.3d 656, 658-59, 662 (5th Cir. 1995)). "However, a dismissal may be appropriate 'when all of the issues raised in the district court must be submitted to arbitration.'" Id. at 249-50 (emphasis in original) (quoting Alford v. Dean Witter Reynolds, Inc., 975 F.2d 1161, 1164 (5th Cir. 1992); citing Adam Techs. Int'l S.A. de C.V. v. Sutherland Global Servs., Inc., 729 F.3d 443, 447 n.1 (5th Cir. 2013)).
"When deciding whether the parties agreed to arbitrate a certain matter (including arbitrability), courts generally . . . should apply ordinary state-lawprinciples that govern the formation of contracts." First Options, 514 U.S. at 944. "Under Texas law2, a binding contract requires: '(1) an offer; (2) an acceptance in strict compliance with the terms of the offer; (3) a meeting of the minds; (4) each party's consent to the terms; and (5) execution and delivery of the contract with intent that it be mutual and binding.'" Huckaba v. Ref-Chem, L.P., 892 F.3d 686, 689 (5th Cir. 2018) (quoting In re Capco Energy, Inc., 669 F.3d 274, 279-80 (5th Cir. 2012)). "'The determination of a meeting of the minds, and thus offer and acceptance, is based on the objective standard of what the parties said and did and not on their subjective state of mind." In re Capco Energy, 669 F.3d at 280 (quoting Copeland v. Alsobrook, 3 S.W.3d 598, 604 (Tex. App.—San Antonio 1999, pet. denied)). Additionally, a...
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