Marie v. Allied Home Mortgage Corp., 04-1403.

Citation402 F.3d 1
Decision Date16 March 2005
Docket NumberNo. 04-1403.,04-1403.
PartiesMartha M. MARIE, Plaintiff, Appellee, v. ALLIED HOME MORTGAGE CORP., Defendant, Appellant, Joseph Thompson, Defendant.
CourtUnited States Courts of Appeals. United States Court of Appeals (1st Circuit)

Diane M. Saunders, with whom Danielle Meagher, James M. Pender, and Morgan, Brown & Joy, LLP, were on brief, for appellant.

Robert M. Mendillo, with whom Mendillo & Ross, LLP, was on brief, for appellee.

Before LYNCH, Circuit Judge, STAHL, Senior Circuit Judge, and HOWARD, Circuit Judge.

LYNCH, Circuit Judge.

This case involving employment arbitration agreements deals with important issues both for Title VII law and for the division of labor between courts and arbitrators after the Supreme Court's decisions in Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 123 S.Ct. 588, 154 L.Ed.2d 491 (2002), and Green Tree Fin. Corp. v. Bazzle, 539 U.S. 444, 123 S.Ct. 2402, 156 L.Ed.2d 414 (2003). The employee concedes that the Title VII claims involved in this case are arbitrable. See Rosenberg v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 170 F.3d 1, 10 (1st Cir.1999). The key issue is whether an employer waives its contractual right to compel arbitration of a Title VII claim by not filing for arbitration when the employee initiates an EEOC complaint, but instead waiting and only moving to compel arbitration after the employee later files a civil claim in federal court. We hold here that although the issue of compliance with a contractual time limit should, in the first instance, be addressed by the arbitrator, the issue of waiver of the right to arbitrate due to inconsistent activity in another litigation forum remains an issue for the court even after the Howsam and Green Tree holdings.

Moreover, on the merits, we hold that an employer does not waive its right to arbitration by failing to demand arbitration during the pendency of an EEOC investigation. This confirms in the light of intervening Supreme Court cases a result this court had reached earlier on different reasoning. See Brennan v. King, 139 F.3d 258, 263-64 (1st Cir.1998). Our reasoning rests in part on EEOC v. Waffle House, Inc., 534 U.S. 279, 122 S.Ct. 754, 151 L.Ed.2d 755 (2002), which held that an employer cannot preclude the EEOC from bringing an enforcement action based on an employee's complaint by relying on an arbitration clause between the employer and employee. In light of Waffle House, a rule forcing the employer to file for arbitration during the pendency of an EEOC investigation would lead to wasteful, duplicative proceedings, and we reject such a result. We hold that the employer in this case has not waived its right to arbitrate the claims at issue. We reverse the decision of the district court refusing to stay judicial proceedings and compel arbitration, and remand.

I.

Allied Home Mortgage Corporation is a Texas corporation in the business of mortgage banking; it has a branch office in Woburn, Massachusetts. Martha M. Marie began working for Allied's Woburn branch on November 1, 2000 as a mortgage loan processor. Joseph Thompson, a branch manager of Allied's Woburn branch, hired Marie and was her supervisor. He was Marie's boyfriend at the time of her hiring. She was to be compensated by receiving fifty percent of any loan origination fees on all loans she originated.

Marie alleges that Thompson used "undue influence, verbal abuse, and threats of physical abuse" to divert loan origination credit from Marie to Thompson, to force Marie to engage in an "autodialing" scheme in violation of The Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227, and to force Marie to pay for office supplies out of her own pocket. Marie alleges that Allied knew that some of her origination credit was being diverted from Marie to Thompson and did nothing.

Marie also alleges that Thompson threw her out of a stopped car in the winter of 2002 because he was angry with her work. Finally, she alleges that Thompson physically beat Marie in June 2002 both because he was angry with her work and because he thought she was having a sexual affair with another Allied employee. Marie alleges that Thompson wanted her to have sexual relations solely with him. Marie never returned to work after the beating in June — the company listed her termination date as June 28, 2002. She claims that Allied falsely reported in its personnel records that she voluntarily quit her position. In July 2002, Marie sought and obtained an Abuse Prevention Order from a Massachusetts state court requiring Thompson to stay away from her.

When Marie was hired by Allied on November 1, 2000, she signed an employment contract that was also signed by Thompson as Allied's representative. This four-page standard-form agreement contained an arbitration clause in Article 5.1. The clause states:

Employer and Employee agree to submit to final and binding arbitration any and all disputes, claims (whether in tort, contract, statutory, or otherwise), and disagreements concerning the interpretation or application of this Agreement and Employee's employment by Employer and the termination of this Agreement and Employee's employment by Employer including the arbitrability of any such controversy or claim.... Arbitration under this section must be initiated within sixty days of the action, inaction, or occurrence about which the party initiating the arbitration is complaining.

The agreement also stated that any arbitration was to be conducted under the rules of the American Arbitration Association (AAA).

On April 23, 2003, Marie filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) and with the Massachusetts Commission Against Discrimination (MCAD) against Allied and Thompson. The charge alleged sexual discrimination in violation of Title VII of the Civil Rights Act of 1964 and applicable state law. The charge, in particular, alleged that during Marie's employment with Allied, Thompson "physically abused [her] and verbally abused [her] repeatedly because he thought [she] was having a sexual affair with another employee, and Thompson wanted [her] to have sexual relations only with him."

Allied filed a response to this charge on May 22, 2003. The EEOC issued a Dismissal and Notice of Rights on July 18, 2003, stating that it had concluded its investigation without finding that any violation of Title VII occurred. It stated that the evidence showed that Marie and Thompson lived together and represented themselves as domestic partners; there was no evidence that her "consensual relationship" with Thompson was "unwelcome" as required to be actionable under Title VII. Also, Thompson's actions were motivated by his personal relationship, not by Marie's gender. Finally, the dismissal noted that Marie did not utilize Allied's existing sexual harassment policy. The dismissal stated that Marie now had a right to sue Thompson or Allied for sexual discrimination in federal or state court.

On October 14, 2003, Marie filed a civil complaint in Massachusetts Superior Court, naming Allied and Thompson as defendants; an amended complaint was filed on November 6, 2003. The amended complaint named both Allied and Thompson as defendants for assault and battery and sexual harassment under Title VII of the Civil Rights Act of 1964, and named Allied for negligent supervision of Thompson and for breach of contract and unjust enrichment. Marie asked for money damages and attorney's fees and costs under Title VII.

Thompson has never been served; Allied was served on November 20, 2003. Allied removed the action to federal district court in Massachusetts on December 9, 2003. On December 22, Allied filed a demand for arbitration with the AAA, within sixty days of being served. On December 23, 2003, Allied moved to compel arbitration and to stay the court proceedings; the motion was opposed by Marie. This motion was denied on January 8, 2004 (the order was docketed on January 12, 2004), by order stating: "It being undisputed that the initiation of arbitration proceedings occurred on December 22, 2003, more than sixty days after the conclusion of [the] charge proceedings before the [EEOC], the demand for arbitration is untimely under Article V of plaintiff's employment agreement."

Allied did not appeal this order but instead, on January 26, 2004, moved to dismiss Marie's complaint as untimely, or, in the alternative, to reconsider the denial of the motion to compel arbitration and stay proceedings under Fed.R.Civ.P. 59(e). This motion was denied as to each alternative on February 18. The court considered the contract to be one of adhesion and relied upon the rule that an "ambiguous provision in an adhesion agreement will be strictly construed against the party that wrote it." The court also stated that Allied's argument was based on the premise that Marie was required to initiate arbitration within sixty days of the conclusion of the EEOC proceedings if she wanted to pursue her claims, while Allied had six years (the full limitation period for contract actions under Massachusetts law) to demand arbitration. This, the court stated, was inequitable and a "breathtaking" reading of the contract. The court, citing Martin v. Norwood, 395 Mass. 159 478 N.E.2d 955, 957-58 (1985), held that Allied, through its delay, had "waived" its right to arbitrate the claims and thus the lawsuit would proceed.

The district court's January 12 and February 18 holdings relied on two distinct theories for why arbitration should not be compelled and litigation stayed: (1) Allied's purported failure to comply with the precise 60-day time limit contained in the arbitration provision, as interpreted by the court, and (2) Allied's waiver of its right to arbitrate due to unreasonable delay.

Allied filed a notice of appeal to this court on March 12, 2004. The notice appealed the district court's February 18, 2004 order, "insofar as such [o]...

To continue reading

Request your trial
365 cases
  • Livingston v. METROPOLITAN PEDIATRICS, LLC, 060100470
    • United States
    • Court of Appeals of Oregon
    • March 3, 2010
    ...7 ULA 16 (Supp. 2005). Federal circuits are split on that question under the Federal Arbitration Act (FAA). See Marie v. Allied Home Mortgage Corp., 402 F.3d 1, 12 (1st Cir.2005) (discussing However, in Oregon, waiver likewise has been treated as a condition precedent to arbitrability. In I......
  • Morgan Stanley & Co. v. Couch
    • United States
    • U.S. District Court — Eastern District of California
    • September 24, 2015
    ...arbitrator, is in the best position to decide whether the conduct amounts to a waiver under applicable law"); Marie v. Allied Home Mortg. Corp., 402 F.3d 1, 14 (1st Cir.2005) ("The proper presumption in this case is that the waiver issue is for the court and not the arbitrator."); Ehleiter ......
  • Perry Homes v. Cull
    • United States
    • Supreme Court of Texas
    • May 2, 2008
    ...see also Green Tree Fin. Corp. v. Bazzle, 539 U.S. 444, 451-52, 123 S.Ct. 2402, 156 L.Ed.2d 414 (2003). 28. See Marie v. Allied Home Mortgage Corp., 402 F.3d 1, 13 (1st Cir.2005). 29. Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 449, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006) ("We re......
  • Portugues-Santa v. B. Fernandez Hermanos, Inc.
    • United States
    • U.S. District Court — District of Puerto Rico
    • May 15, 2009
    ...under a special carve-out that would allow for an immediate appeal of the denial of the motion. See, e.g., Marie v. Allied Home Mortgage Corp., 402 F.3d 1, 6-7 (1st Cir.2005) (collecting cases in which certain pretrial orders are deemed immediately appealable and thus falling under FED.R.CI......
  • Request a trial to view additional results
5 books & journal articles
  • Participation in Litigation as a Waiver of the Contractual Right to Arbitrate: Toward a Unified Theory
    • United States
    • University of Nebraska - Lincoln Nebraska Law Review No. 92, 2021
    • Invalid date
    ...539 F.3d 388, 393-94 (6th Cir. 2008); Ehleiter v. Grapetree Shores, Inc., 482 F.3d 207, 217 (3d Cir. 2007); Marie v. Allied Home Mortgage, 402 F.3d 1, 14 (1st Cir. 2005); Republic Ins. Co. v. Paico Receivables LLC, 383 F.3d 341, 346-49 (5th Cir. 98. See Marie, 402 F.3d at 12 ("[T]he First C......
  • Chapter 8 - § 8.6 • WHO DETERMINES EACH SPECIFIC ARBITRABILITY ISSUE UNDER THE FAA?
    • United States
    • Colorado Bar Association Colorado and Federal Arbitration Law and Practice (CBA) Chapter 8 Arbitrability Issues: Who Decides Them?
    • Invalid date
    ...712 F.3d 173 (4th Cir. 2013).[124] Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002). See also Marie v. Allied Home Mortg. Corp., 402 F.3d 1 (1st Cir. 2005); see also Industra/Matrix Joint Venture v. Pope & Talbot, Inc., 142 P.3d 1044 (Or. 2006); St. Paul Fire & Marine Ins. Co. v. Ap......
  • Chapter 6 - § 6.2 • ARBITRATION OF EMPLOYER-EMPLOYEE DISPUTES
    • United States
    • Colorado Bar Association Colorado and Federal Arbitration Law and Practice (CBA) Chapter 6 Arbitration of Particular Kinds of Claims and Between Particular Entities
    • Invalid date
    ...Colo. 2001). As to EEOC claims, see Dumais v. American Golf Corp., 299 F.3d 1216 (10th Cir. 2002).[16] Marie v. Allied Home Mortgage Corp., 402 F.3d 1 (1st Cir. 2005); cf. EEOC v. Waffle House, Inc., 534 U.S. 279 (2002). But see Scaffidi v. Fiserv, Inc., 2006 U.S. Dist. LEXIS 50546, 2006 WL......
  • Chapter 7 - § 7.9 • WAIVER OF RIGHT TO ARBITRATE
    • United States
    • Colorado Bar Association Colorado and Federal Arbitration Law and Practice (CBA) Chapter 7 Arbitrability of Disputes: the Issues and the Law
    • Invalid date
    ...School District No. 6 v. Alfred Watts Grant & Assocs., 399 P.2d 101, 103 (Colo. 1965); Marie v. Allied Home Mortg. Corp., 402 F.3d 1 (1st Cir. 2005); Vernon, 857 F. Supp. 2d at 1158 (D. Colo. 2012) (citing Metz v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 39 F.3d 1482, 1489 (10th Cir. 19......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT