Karp v. Cigna Healthcare, Inc.

• Decision Date: 14 September 2012
• Docket Number: Civil Action No. 11–10361–FDS.
• Citation: 882 F.Supp.2d 199
• Parties: Bretta KARP, on behalf of herself individually and all others similarly situated, Plaintiff, v. CIGNA HEALTHCARE, INC., Defendant.
• Court: U.S. District Court — District of Massachusetts

882 F.Supp.2d 199

Bretta KARP, on behalf of herself individually and all others similarly situated, Plaintiff,

v.CIGNA HEALTHCARE, INC., Defendant.

Civil Action No. 11–10361–FDS.

United States District Court, D. Massachusetts.

April 18, 2012.

Order Denying Reconsideration Sept. 14, 2012.

Kevin M. Kinne, Christopher M. Hennessey, Cohen Kinne Valicenti & Cook, LLP, Pittsfield, MA, David W. Sanford, Thomas J. Henderson, Sanford Wittels & Heisler, LLP, Washington, DC, for Plaintiff.

David C. Casey, Dennis M. Brown, Stephen T. Melnick, III, Littler Mendelson P.C., Boston, MA, for Defendant.

MEMORANDUM AND ORDER ON DEFENDANT'S MOTION TO DISMISS AND COMPEL ARBITRATION

SAYLOR, District Judge.

This is an action alleging unlawful gender discrimination in violation of Title VII of the Civil Rights Act of 1964,42 U.S.C. § 2000e, andMassachusetts General Laws Chapter 151B.PlaintiffBretta Karp, on behalf of herself and all other employees similarly situated, contends that her employer, defendantCIGNA Healthcare, Inc., engaged in systematic gender discrimination in the workplace.¹

The issue before the Court is whether this dispute is subject to arbitration.Defendant has moved to compel arbitration and to stay or dismiss the litigation.Defendant contends that plaintiff signed an agreement requiring that disputes such as this be submitted to bilateral arbitration.Plaintiff contends that she did not agree to waive class claims against defendant, and that bilateral arbitration will not adequately vindicate her statutory rights under Title VII, and that therefore the arbitration clause cannot be enforced.

For the reasons stated below, the motion to compel arbitration will be granted.

I.Factual Background

Bretta Karp began working for CIGNA in June 1997, after CIGNA acquired Healthsource Inc.(KarpAff. ¶ 2).²Karp worked as a Provider Contract Manager, and was responsible for managing contracts with hospitals and other healthcare providers.( Id.¶ 3;Compl.¶ 63).

In February 1998, CIGNA provided Karp with a copy of the “CIGNA Healthcare Division: Employment Dispute Arbitration Policy”(the “1998 Policy”).(SteinDecl. ¶ 19, Ex. E, F).The 1998 Policy required that employees arbitrate their disputes with the company rather than going to court.( Id., Ex. E).It did not address class actions or class arbitration.( Seeid.).On February 17, 1998, Karp signed a receipt acknowledging that she received the 1998 Policy and other policies relevant to her employment.(Def. Mot., at 5–6;SteinDecl. ¶ 19, Ex. F).

On November 4, 2005, CIGNA sent a company-wide e-mail informing employees that the Employee Handbook had been updated to reflect changes in the company's policies and procedures.(Karp. Aff. ¶ 10–11, Ex. 1).The e-mail contained a link to an electronic copy of the Handbook, and instructed employees to complete an electronic receipt indicating that they had received the handbook.( Id.;see also Stein Decl., Ex. G).The e-mail indicated that failure to fill out the receipt could impact the employee's future employment with the company.(Karp. Aff. ¶¶ 9–10, Ex. 1).

CIGNA sent Karp e-mails on November 9 and November 16, 2005, that contained a link to the handbook.The e-mails also reminded Karp that she needed to sign the electronic handbook receipt, and that not doing so could “impact [her] employment future at CIGNA.”(KarpAff., Ex. 2, 3).On November 22, 2005, Karp checked “yes” on the handbook receipt.(Stein Decl., Ex. G).The electronic receipt stated in relevant part:

I acknowledge that I have received or reviewed the updated (November 2005) CIGNA Employee Handbook, which outlines the policies that are available and applicable to all of the CIGNA companies' employees.

I understand that a full text of (or additional details about) specific policies, procedures and programs, are posted on CIGNA's websites.

* * *

I agree any dispute between CIGNA and me arising out of or relating to my candidacy for employment, employment, or termination of employment with CIGNA (with the exception of workers compensation claims, ERISA claims and administrative agency charges) shall be resolved under CIGNA's Employment Dispute Arbitration Program which includes final mandatory binding arbitration.I understand that any such Arbitration will be conducted pursuant to the CIGNA Employee Dispute Arbitration Rules and Procedures in effect at the time such arbitration is commenced.

( Id.).The handbook, CIGNA's e-mails, and the electronic receipts did not mention class arbitration or a class-action waiver.

A. CIGNA's Dispute Resolution Policy

The CIGNA employee handbook summarizes the employment dispute resolution program as involving internal and external resolution processes.(Stein Decl., Ex. A, at 25).Specifically, the handbook states that “[b]y accepting employment ... you have agreed to arbitrate serious employment-related disagreements between you and the Company ... using the Company's Employment Dispute Arbitration Policy and Employment Dispute Arbitration Rules and Procedures.”( Id. at 25–26).These “serious disagreements” include “claims, demands, or actions under Title VII of the Civil Rights Act of 1964, ... and any other federal, state or local statute, regulation, ordinance, or common law doctrine, regarding employment discrimination, conditions of employment, or termination of employment.”( Id. at 26).The last page of the Handbook states that “a full text of (or additional details about) specific policies, procedures and programs, are posted on CIGNA's websites.”( Id. at 39).³

The CIGNA Arbitration Policy states that “arbitration by a neutral third-party is the required and final means for the resolution of any employment related legal claim not resolved by the CIGNA Companies' internal dispute resolution process.”(Stein Decl., Ex. B, at 1).The Arbitration Policy and the Arbitration Rules and Procedures provide additional detail, not found in the Handbook, as to the scope of arbitration.Specifically, the Arbitration Policy states:

No class-wide arbitrations are allowed under the CIGNA Companies' Employment Dispute Arbitration Policy or the Rules and Procedures.The arbitrator has no jurisdiction to certify any group of current or former employees, or applicants for employment, as a class in any arbitration setting.

(Stein Decl., Ex. B, at 3).In addition, the Arbitration Rules and Procedures state:

Each party seeking resolution of its, his or her claims pursuant to an agreement to arbitrate under these Rules and Procedures must proceed individually.There shall be no class or representative actions permitted.An Arbitrator shall have no authority to hear claims of or award damages to any person or entity who has not initiated arbitration and selected an arbitrator in accordance with these Rules and Procedures.Also, an arbitrator shall not have authority to consolidate claims or consider individual claims collectively on the ground that such actions promote efficiency or that the individual damages may be too small to proceed economically, except when there is an express agreement between the Company and the employees in writing, or on the stenographic record of the particular arbitration proceeding for which the agreement to proceed collectively is made.

(Stein Decl., Ex. C, at 2, ¶ 1).

The Arbitration Rules and Procedures also address the scope of discovery and relief.Specifically, they state that “[a]party will be entitled to take no more than two days of depositions,” and that “[t]he scope and timing of discovery may be expanded, altered, amended or otherwise changed to accommodate the circumstances of a particular arbitration at the discretion of the arbitrator.”(Stein Decl., Ex. C, at 7–8, ¶ 11).The rules and procedures also state that “[t]he arbitrator will have full power and authority to award any remedy that either party would have been entitled to had the employee taken the dispute to a government agency or to a court.”( Id. at 12, ¶ 25).

II.Procedural History

On March 3, 2011, Karp instituted the present action against CIGNA on behalf of herself and all other similarly situated female employees.The complaint alleges that CIGNA, through its policies, practices, and procedures, engaged in systematic gender discrimination by paying women less, denying or denying promotions, gave women less preferable work assignments, and subjected women to gender-based hostility.(Compl. ¶ 23).The complaint seeks declaratory and injunctive relief, as well as compensatory, nominal, and punitive damages and attorney's fees.(Compl. at 21–23).Defendant has moved to compel arbitration and for dismissal after referral to arbitration, or, in the alternative, to stay the litigation pending the conclusion of arbitration.⁴

III.Legal Standard

The Federal Arbitration Act,9 U.S.C. § 1 et seq., governs the enforcement of written arbitration agreements.SeeCircuit City Stores, Inc. v. Adams,532 U.S. 105, 119, 121 S.Ct. 1302, 149 L.Ed.2d 234(2001)(holding that the FAA extends to employment cases for employees other than those engaged in transportation).It was enacted in order to reverse longstanding judicial hostility to arbitration agreements and to “place such agreements upon the same footing as other contracts.”Allied–Bruce Terminix Cos., Inc. v. Dobson,513 U.S. 265, 271, 115 S.Ct. 834, 130 L.Ed.2d 753(1995)(citation and internal quotation omitted);accordAT & T Mobility LLC v. Concepcion,––– U.S. ––––, 131 S.Ct. 1740, 1745–1746, 179 L.Ed.2d 742(2011).⁵When “construing an arbitration clause, courts and arbitrators must ‘give effect to the contractual rights and expectations of the parties.’ ”Stolt–Nielsen S.A. v. AnimalFeeds Int'l Corp.,559 U.S. 662, 130 S.Ct. 1758, 1773–74, 176 L.Ed.2d 605(2010)(citation omitted).The act promotes “a liberal federal policy favoring arbitration agreements ....[and] any doubts concerning the scope of arbitrable issues should be resolved in favor of...