Nelson v. Kunkle

• Decision Date: 20 March 2020
• Docket Number: 8:19-CV-329
• Parties: BARBARA NELSON, Plaintiff, v. JULIE KUNKLE, and AMERICAN BLUE RIBBON HOLDINGS, LLC, a Delaware limited liability company; Defendants.
• Court: U.S. District Court — District of Nebraska

BARBARA NELSON, Plaintiff, v. JULIE KUNKLE, and AMERICAN BLUE RIBBON HOLDINGS, LLC,

a Delaware limited liability company; Defendants.

8:19-CV-329

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEBRASKA

March 20, 2020

MEMORANDUM AND ORDER

This matter is before the Court on Defendants' Motion to Dismiss or Compel Arbitration pursuant to Fed. R. Civ. P. 12(b)(6) and 9 U.S.C. §§ 3-4. Filing 16. Plaintiff, Barbara Nelson, sued both American Blue Ribbon Holdings, LLC ("ABRH"), and Julie Kunkle (collectively, "Defendants") for interference and retaliation under the Family Medical Leave Act ("FMLA"), 29 U.S.C. § 2601 et seq. Filing 1 at 4-6. Plaintiff further alleges Kunkle defamed her, and ABRH violated her rights under (1) the Consolidated Omnibus Budget Reconciliation Act of 1986 ("COBRA"), 29 U.S.C. §§ 1161-68, and (2) the Nebraska Wage Payment and Collection Act ("NWPCA"), Neb. Rev. Stat. § 48-1228 et seq. Defendants request an order dismissing or staying this action because Plaintiff is subject to a mandatory arbitration agreement. Filing 16.

Pursuant to an Order dated January 29, 2019 (Filing 25), this Court stayed proceedings against defendant ABRH upon ABRH filing a suggestion of bankruptcy (Filing 24). Given the stay in proceedings, the Court will deny ABRH's motion to compel arbitration without prejudice to reassertion should the bankruptcy court lift its stay and will not otherwise address ABRH's request to compel arbitration.

Because there is a broad presumption in favor of arbitration, the Court determines Plaintiff's claims against Kunkle are subject to arbitration despite her status as a nonsignatory party to the arbitration agreement in question. As a result, the Court will grant Kunkle's Motion to Compel (Filing 16) but will stay the proceedings against Kunkle pending arbitration rather than dismiss them.

I. BACKGROUND

The Complaint alleges Plaintiff worked as an assistant manager at an ABRH-owned and operated Village Inn restaurant until February 7, 2019. Filing 1 at 1. Kunkle was the general manager and Plaintiff's immediate supervisor at that restaurant. Filing 1 at 1. Plaintiff alleges Kunkle made defamatory statements about her to Village Inn employees, managers, or "others" in August of 2018. Filing 1 at 1, 3. In November and December of 2018, Plaintiff's appendix ruptured, and she developed a bowel obstruction. Filing 1 at 2. Related to these infirmities, Plaintiff alleges Kunkle interfered with her substantive FMLA rights and retaliated against her in violation of the FMLA. Filing 1 at 4-5. Plaintiff similarly alleges ABRH interfered with her substantive FMLA rights, retaliated against her in violation of the FMLA, violated her COBRA rights by failing to notify her of her right to continued coverage and failed to pay out her accrued vacation hours in violation of the NWPCA. Filing 1 at 4-6.

Defendants moved to dismiss or compel arbitration because Plaintiff is allegedly subject to a mandatory arbitration agreement. Filing 16. Shortly thereafter, ABRH filed a Suggestion of Bankruptcy. (Filing 24). Pursuant to NEGenR 1.5(a)(1), the Court stayed this matter as to ABRH but allowed the case to proceed against Kunkle. Filing 25.

In support of its Motion to Compel, Defendants explain ABRH required Plaintiff to complete an online onboarding and orientation process that included review and acknowledgment of various employment-related agreements and documents when ABRH hired her in October 2014.Filing 16-2 at 3. One such document was a Dispute Resolution Agreement (the "Agreement"). Filing 16-2 at 3, 6-8. The Agreement states in relevant part as follows:

This Agreement is governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq. and evidences a transaction involving commerce. This Agreement applies to any dispute arising out of or related to the undersigned Employee's employment with ABRH, LLC or one of its affiliates, successor, subsidiaries or parent companies ("Company") or termination of employment and survives after the employment relationship terminates.

. . . .

Except as it otherwise provides, this Agreement is intended to apply to the resolution of disputes that otherwise would be resolved in a court of law or before a forum other than arbitration. This Agreement requires all such disputes to be resolved only by an arbitrator through final and binding arbitration and not by way of court or jury trial. Such disputes include without limitation disputes arising out of or relating to interpretation or application of this Agreement, but not as to the enforceability, revocability or validity of the Agreement or any portion of the Agreement. . . . Except as it otherwise provides, this Agreement also applies, without limitation, to disputes regarding the employment relationship, trade secrets, unfair competition, compensation, breaks and rest periods, termination, retaliation, discrimination, or harassment and claims arising under the Uniform Trade Secrets Act, Civil Rights Act of 1964, Americans With Disabilities Act, Age Discrimination in Employment Act, Family Medical Leave Act, Fair Labor Standards Act, Employee Retirement Income Security Act (except for claims for employee benefits under any benefit plan sponsored by the Company and covered by the Employee Retirement Income Security Act of 1974 or funded by insurance), Genetic Information Non-Discrimination Act, and state statutes, if any, addressing the same or similar subject matters, and all other state statutory and common law claims.

Filing 16-2 at 6.

A link to the Agreement and other onboarding paperwork was sent to Plaintiff's self-provided personal email address. Filing 16-2 at 3. To complete the paperwork, someone had to access it via the link emailed to Plaintiff, enter Plaintiff's email address as a username, use Plaintiff's zip code as the password, and subsequently enter Plaintiff's address, telephone number, date of birth, Social Security number, gender, marital status, and direct deposit banking information. Filing 16-2 at 3; Filing 23-1 at 4. ABRH's computer system requires an individualfilling out this required paperwork to complete and initial each document before moving to the next. Filing 23-1 at 5. Once a document is completed and signed, ABRH's computer system shows such documentation as "saved" within the system. Filing 23-1 at 5. That "saved" information "cannot be edited and no information can ever be deleted in the system." Filing 23-1 at 5.

On October 2, 2014, someone accessed the link sent to Plaintiff's email address, provided all of Plaintiff's above-listed personal information, electronically signed the Agreement by typing Plaintiff's initials, and in doing so expressly consented to the terms of the Agreement. Filing 16-2 at 4, 9 ("I have read the [Agreement], and I agree to the terms and conditions of the [Agreement]."). ABRH records show the individual accessing the link reviewed the Agreement for roughly four minutes. Filing 16-2 at 4. In the computer system, Plaintiff's onboarding paperwork shows "saved" next to the "ADR" document, which is the Agreement. Filing 16-2 at 11; Filing 23-1 at 5. The system also shows she completed a personal information form, her I-9 form, an emergency contact form, a direct deposit form, and numerous other forms before and after completing the Agreement. Filing 16-2 at 11; Filing 23-1 at 5. Plaintiff avers she has never seen, signed, or assented to the Agreement's terms. Filing 20-1 at 1. Yet ABRH did not in any way collect Plaintiff's personal, banking, tax, emergency, and other information outside of the online onboarding paperwork process. Filing 23-1 at 6.

On Plaintiff's first day of work, October 8, 2014, the system shows someone spent approximately one minute reviewing the Agreement before electronically signing it as part of Plaintiff's orientation. Filing 16-2 at 4. ABRH generally does not allow employees to continue online orientation or begin work until they have agreed to the terms of the Agreement. Filing 16-2 at 4. However, Plaintiff avers her orientation did not include anything relating to the Agreement. Filing 20-1 at 1.

II. STANDARD OF REVIEW

"A party aggrieved by the alleged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration may petition any United States district court . . . for an order directing that such arbitration proceed in the manner provided for in such agreement." 9 U.S.C. § 4. "[U]pon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under [an arbitration agreement]," the Court shall "stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement. 9 U.S.C. § 3.

A motion to compel arbitration may be submitted under Rule 12(b)(6) or Rule 56, but it "must ultimately 'be treated as one for summary judgment under Rule 56.'" City of Benkelman v. Baseline Eng'g Corp., 867 F.3d 875, 882 (8th Cir. 2017) (quoting Fed. R. Civ. P. 12(d)). "Summary judgment is appropriate when the evidence, viewed in the light most favorable to the nonmoving party, presents no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Garrison v. ConAgra Foods Packaged Foods, LLC, 833 F.3d 881, 884 (8th Cir. 2016) (citing Fed. R. Civ. P. 56(c)). In reviewing a motion for summary judgment, the Court will view "the record in the light most favorable to the nonmoving party . . . drawing all reasonable inferences in that party's favor." Whitney v. Guys, Inc., 826 F.3d 1074, 1076 (8th Cir. 2016) (citing Hitt v. Harsco Corp., 356 F.3d 920, 923-24 (8th Cir. 2004)). "[T]here must be more than 'the mere existence of some alleged factual dispute'" between the parties in order to overcome summary judgment. Dick v. Dickinson State Univ., 826 F.3d 1054, 1061 (8th Cir. 2016) (quoting Vacca v. Viacom Broad. of Missouri, Inc., 875 F.2d 1337, 1339 (8th Cir. 1989)).

III. DISCUSSION

Defendants argue the Court should compel...