Jann v. Interplastic Corp.

• Decision Date: 07 July 2009
• Docket Number: Civ. No. 09-721 (RHK/JJK).
• Citation: 631 F.Supp.2d 1161
• Parties: Brenda JANN, Plaintiff, v. INTERPLASTIC CORPORATION, Defendant.
• Court: U.S. District Court — District of Minnesota

Page 1161

631 F.Supp.2d 1161

Brenda JANN, Plaintiff, v. INTERPLASTIC CORPORATION, Defendant.

Civ. No. 09-721 (RHK/JJK).

United States District Court, D. Minnesota.

July 7, 2009.

Mark A. Greenman, Law Office of Mark A. Greenman, Minneapolis, MN, for Plaintiff.

Ivan M. Levy, Vice President and General Counsel, Interplastic Corporation, St. Paul, MN, for Defendant.

MEMORANDUM OPINION AND ORDER

RICHARD H. KYLE, District Judge.

Plaintiff Brenda Jann has sued her former employer, Interplastic Corporation ("Interplastic"), asserting claims under the Family and Medical Leave Act ("FMLA"), 29 U.S.C. § 2601 et seq., the Americans with Disabilities Act ("ADA"), 42 U.S.C. § 12101 et seq., and the Minnesota Human Rights Act ("MHRA"), Minn.Stat. § 363A.01 et seq. Interplastic now moves to compel arbitration. For the reasons set forth below, the Court will grant the Motion.

BACKGROUND

Jann previously worked for Interplastic as a receptionist. (Compl. ¶ 5.) She suffers from serious medical conditions including "a fractured spinal disc, degenerative disc disease, and fibromyalsia [sic]." (Id. ¶ 6.) In January 2009, she learned that she would need surgery to treat these conditions, and so informed Interplastic. (Id. ¶¶ 9-10.) Shortly thereafter, the company terminated her employment, informing her that her position had been eliminated. (Id. ¶ 12.) According to Jann, her position was not eliminated and, instead, Interplastic terminated her as a result of her medical conditions, in violation of the statutes set forth above. (Id. ¶¶ 13-21.)

When Jann's employment with Interplastic began in October 2005, she signed an employment agreement containing an arbitration provision. (Def. Mem. Ex. A.)¹ The provision provides that "[a]ll disputes between us involving monetary damages shall be resolved by BINDING ARBITRATION." (Id. (emphases in original).) The agreement then sets forth examples of arbitrable claims, including claims of "[d]iscrimination based on . . . disability . . . or any other category protected from discrimination by federal, state, and/or local law." (Id.) Jann also received an employee handbook containing a nearly identical arbitration provision. (Id. Ex. B.)²

Based on the arbitration provision in the employment agreement and in the hand-book Interplastic now moves to compel arbitration of the present dispute.³

STANDARD OF REVIEW

Through the Federal Arbitration Act (the "FAA"), 9 U.S.C. § 1 et seq., Congress has established a strong federal policy in favor of arbitration. Shearson/Am. Express, Inc. v. McMahon, 482 U.S. 220, 226, 107 S.Ct. 2332, 96 L.Ed.2d 185 (1987). Section 2 of the FAA provides that an arbitration provision in "a contract evidencing a transaction involving commerce . . . shall be valid, irrevocable, and enforceable." 9 U.S.C. § 2.⁴ And Section 4 of the Act provides that a party may petition a federal district court for an order compelling arbitration of a dispute covered by an agreement to arbitrate. 9 U.S.C. § 4.

A motion to compel arbitration under the FAA requires answering two questions: Is there a valid agreement to arbitrate between the parties? And if so, does the dispute fall within the scope of that arbitration agreement? E.g., Pro Tech Indus., Inc. v. URS Corp., 377 F.3d 868, 871 (8th Cir.2004). In determining whether claims come within the scope of an arbitration provision, "the district court does not reach the potential merits of any claim but construes the clause liberally, resolving any doubts in favor of arbitration and granting the motion unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute." 3M Co. v. Amtex Sec., Inc., 542 F.3d 1193, 1199 (8th Cir.2008) (internal quotation marks and citation omitted); accord, e.g., Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983) (because of the strong federal policy favoring arbitration, "any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration"). "[T]he party resisting arbitration bears the burden of proving that the claims at issue are unsuitable for arbitration." Green Tree Fin. Corp.-Ala. v. Randolph, 531 U.S. 79, 91, 121 S.Ct. 513, 148 L.Ed.2d 373 (2000) (citations omitted).

ANALYSIS

There is no dispute here that a valid agreement to arbitrate exists between the parties, via both the employment agreement and the employee handbook. (Mem. in Opp'n at 1-2.) Nor is there any dispute that at least some of Jann's claims fall within the scope of that agreement. (Id. at 6-7.) Indeed, she concedes the arbitrability of her ADA and MHRA claims, at least insofar as they seek money damages, because they are claims of "[d]iscrimination based on . . . disability." (Def. Mem. Exs. A-B.) On this basis alone, the Court could grant Interplastic's Motion and refer these matters to arbitration. See, e.g., Webb v. R. Rowland & Co., 800 F.2d 803, 807-08 (8th Cir.1986) (district court may refer arbitrable claims while staying non-arbitrable ones).⁵

But the Court need not divide this case into arbitrable and non-arbitrable pieces, because it concludes that all of Jann's claims are subject to arbitration. She raises only two arguments to the contrary. First, she argues that under 29 C.F.R. § 825.220(d), she cannot waive her right to a judicial forum for her FMLA claim. Second, she argues that because she is seeking equitable relief, her claims are beyond the scope of the arbitration agreement. Neither argument has merit.

I. Section 825.220(d)

29 C.F.R. § 825.220(d) provides that "[e]mployees cannot waive, nor may employers induce employees to waive, their prospective rights under the FMLA." According to Jann, employees have "the right . . . under the FMLA to bring an action in court." (Mem. in Opp'n at 5 (emphasis in original).) Hence, she argues that under Section 825.220(d), she "cannot waive her right to a judicial forum" for her FMLA claim. (Id.)

Jann is correct that the FMLA allows an aggrieved individual to bring an action "in any Federal or State court of competent jurisdiction." 29 U.S.C. § 2617(a)(2). Yet, this is not a "right" rendered unwaivable by Section 825.220(d). That conclusion necessarily flows from the Supreme Court's decision in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991). There, an employee sued his former employer under the Age Discrimination in Employment Act ("ADEA"), and the employer moved to compel arbitration pursuant to an arbitration agreement the employee had signed. Much like the FMLA and its implementing regulations at issue here, the ADEA provides that an employee may "bring a civil action in any court of competent jurisdiction for such legal or equitable relief as will effectuate the purposes of" the statute, 29 U.S.C. § 626(c)(1), and further provides that employees may not waive their prospective rights under the statute, id. § 626(f)(1)(C). On this basis (and others), the district court denied the employer's motion, concluding that "Congress intended to protect ADEA claimants from the waiver of a judicial forum." 500 U.S. at 24, 111 S.Ct. 1647. On appeal, the Fourth Circuit reversed, and the Supreme Court then granted certiorari.

The Supreme Court affirmed the Fourth Circuit's decision. It recognized that "[b]y agreeing to arbitrate . . ., a party does not forgo the substantive rights afforded by the [ADEA]; it only submits to their resolution in an arbitral, rather than a judicial, forum." Id. at 26, 111 S.Ct. 1647 (citation omitted). In other words, the Court distinguished between (a) the substantive protections against discrimination provided by an antidiscrimination statute and (b) claims alleging a violation of those protections. According to Gilmer, only the former constitute unwaivable "rights." See id. at 29, 111 S.Ct. 1647 (rejecting argument that "compulsory arbitration is improper because it deprives claimants of the judicial forum provided for by the ADEA"). The Supreme Court recently reaffirmed Gilmer's holding in 14 Penn Plaza LLC v. Pyett, ___ U.S. ___, 129 S.Ct. 1456, 173 L.Ed.2d 398 (2009), again noting the distinction between an agreement to arbitrate a discrimination claim and the waiver of the right to be free from discrimination. See id. at 1469 ("The decision to resolve ADEA claims by way of arbitration instead of litigation does not waive the statutory right to be free from workplace age discrimination; it waives only the right to seek relief from a court in the first instance.").

Gilmer, therefore, compels the conclusion that individuals may be required to arbitrate FMLA claims, notwithstanding the text of Section 825.220(d). See Faris v. Williams WPC-I, Inc., 332 F.3d 316, 320-21 (5th Cir.2003) (holding that 29 C.F.R. § 825.220(d) "applies only to [the] waiver of substantive rights under the [FMLA], such as rights to leave, reinstatement, etc., rather than to a cause of action . . . for the exercise of those rights"). Jann has failed to cite any cases refusing to compel arbitration of an FMLA claim due to Section 825.220(d), and the Court has failed to locate any. On the other hand, numerous courts post-Gilmer have required the arbitration of FMLA claims. See, e.g., Baker v. Sci. Applications Int'l Corp., No. Civ. 06-4096, 2006 WL 2708546 (D.S.D. Sept. 21, 2006), aff'd, 273 Fed. Appx. 577 (8th Cir.2008); Moncrief v. Terminix Int'l Co. Ltd. P'ship, No. 06-1047, 2006 WL 1764080 (D.Kan. June 27, 2006); Brinkerhoff v. Zachry Constr. Corp., No. 2:04-CV-750, 2005 WL 1661693 (S.D.Ohio July 15, 2005); Martin v. SCI Mgmt. L.P., 296 F.Supp.2d 462 (S.D.N.Y.2003); Jones v. Fujitsu Network Commc'ns, Inc., 81 F.Supp.2d 688 (N.D.Tex.1999). Indeed, just last week the Eighth Circuit reversed a district-court decision denying a motion to compel arbitration of an FMLA claim. McNamara v. Yellow Transp., Inc., 570 F.3d 950, 956-57, 2009 WL 1873503, at *5 (8th Cir. ...