Paltz v. All. HealthCare Servs.

• Decision Date: 04 March 2022
• Docket Number: 3:21-cv-0020 (VAB)
• Parties: KRISTEN PALTZ, Plaintiff, v. ALLIANCE HEALTHCARE SERVICES, INC., LISA CONSIGLIO, and RICHARD DEVANEY, Defendants.
• Court: U.S. District Court — District of Connecticut

KRISTEN PALTZ, Plaintiff,
v.
ALLIANCE HEALTHCARE SERVICES, INC., LISA CONSIGLIO, and RICHARD DEVANEY, Defendants.

No. 3:21-cv-0020 (VAB)

United States District Court, D. Connecticut

March 4, 2022

RULING AND ORDER ON MOTION TO COMPEL ARBITRATION, APPOINT AN ARBITRATOR, AND STAY ALL PROCEEDINGS

VICTOR A. BOLDEN UNITED STATES DISTRICT JUDGE

Kristen Paltz (the “Plaintiff”) has sued Alliance Healthcare Services, Inc., Lisa Consiglio, and Richard Devaney (together, the “Defendants”) under the False Claims Act, 31 U.S.C. § 3730(h); the Family and Medical Leave Act, 29 U.S.C. § 2601 et seq.; the Equal Pay Act of 1963, 29 U.S.C. § 206 et seq.; Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.; the Americans with Disabilities Act, 42 U.S.C. § 12101 et seq.; the Connecticut Equal Pay Act, Conn. Gen. Stat § 31-75 et seq.; the New York State Human Rights Law, N.Y. Exec. Law § 290 et seq.; the New York City Human Rights Law, N.Y.C. Admin. Code § 8-101 et seq.; and the Connecticut Fair Employment Practices Act, Conn. Gen. Stat. § 46a-60. See Am. Compl., ECF No. 29 (Apr. 20, 2021) (“Am. Compl.”).

On April 27, 2021, the Defendants moved for an order, under the Federal Arbitration Act, 9 U.S.C. § 1 et seq., to compel arbitration on the above claims, to appoint an arbitrator, and to stay the proceedings. See Defs.' Mot. to Compel Arbitration of Pl.'s Claims, Appoint an Arbitrator, and Stay Proceedings Pending Ruling on Mot. and Completion of Arbitration, ECF No. 30 (Apr. 27, 2021) (“Mot. to Compel Arbitration”).

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For the reasons explained below, the Court GRANTS the motion to compel arbitration and to appoint an arbitrator. The Court, however, will provide the parties with another opportunity to agree on an arbitrator. By April 8, 2022, the parties shall file a joint response with the name of the proposed arbitrator, or if they cannot agree, each party shall submit three names for the Court's consideration.

This case will be stayed, and administratively closed (without judgment being entered) until the arbitration proceedings have concluded.

I. FACTUAL AND PROCEDURAL BACKGROUND

Ms. Paltz worked at Alliance Healthcare Services, Inc. (“Alliance” or the “Company”) from 1995 until 2020. Am. Compl. ¶¶ 2, 10-12; see also Ex. 1 to Defs.' Mot. to Compel Arbitration of Pl.'s Claims, Appoint an Arbitrator, and Stay Proceedings Pending Ruling on Mot. and Completion of Arbitration ¶ 16, ECF No. 30-2 (Apr. 27, 2021) (“MacPhail Decl.”). On April 1, 2020, the Company allegedly terminated Ms. Paltz for impermissible reasons, including but not limited to disability discrimination and retaliation for whistleblowing, “under the pretext of including her in a reduction-in-force.” Am. Compl. ¶¶ 10-12, 41-104.

On January 7, 2021, Ms. Paltz filed a Complaint against the Company to challenge the termination of her employment, alleging violations of the False Claims Act, 31 U.S.C. § 3730(h); the Family and Medical Leave Act, 29 U.S.C. § 2601 et seq.; the Equal Pay Act of 1963, 29 U.S.C. § 206 et seq.; the Connecticut Equal Pay Act, Conn. Gen. Stat § 31-75 et seq.; the New York State Human Rights Law, N.Y. Exec. Law § 290 et seq.; and the New York City Human Rights Law, N.Y.C. Admin. Code § 8-101 et seq. See Compl., ECF No. 1 (Jan. 7, 2021).

On April 1, 2021, Ms. Paltz filed a motion to amend her Complaint, see Mot. to Amend, ECF No. 23 (Apr. 1, 2021), which the Court granted, see Order, ECF No. 27 (Apr. 20, 2021).

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On April 20, 2021, Ms. Paltz filed an Amended Complaint alleging additional violations of Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.; the Americans with Disabilities Act, 42 U.S.C. § 12101 et seq.; and the Connecticut Fair Employment Practices Act, Conn. Gen. Stat. § 46a-60.

On April 27, 2021, the Defendants filed a motion to compel arbitration of Ms. Paltz's claims under the Federal Arbitration Act, 9 U.S.C. § 1 et seq. See Mot. to Compel Arbitration. In support of their motion, the Defendants offered a written Dispute Resolution Policy (or “DRP”), contained within a Team Member Handbook (“Handbook”). See Ex. 1-B to Defs.' Mot. to Compel Arbitration of Pl.'s Claims, Appoint an Arbitrator, and Stay Proceedings Pending Ruling on Mot. and Completion of Arbitration, ECF No. 30-4 (Apr. 27, 2021) (“Handbook”).

The Handbook includes an “Acknowledgement of Receipt, Agreement, Understanding and Willingness to Comply” (the “Acknowledgement”), which asks employees to acknowledge, inter alia, the following:

[1.] I am expected to be familiar with the contents of the Handbook, including without limitation the Dispute Resolution Policy (“DRP”) contained therein. [ . . . ]

[2.] If any employment-related disputes exist or arise between me and any Alliance operating entities and/or their employees, any such Alliance operating entities and I are and will be bound by the provisions, terms, and conditions of the DRP, including its final and binding arbitration and class representative, and PAGA action waivers. Pursuant to the DRP both the Alliance operating entities and I each waive our rights to have any “Covered Disputes” (as described therein) heard or decided through any type of judge or jury trials, class actions, class arbitrations, collective actions, collective arbitrations, “Representative Action” or “PAGA Action” (as described therein), or coordinated or consolidated arbitrations, actions, or proceedings, all of which are prohibited under the DRP, and we agree that any Covered Disputes can only be resolved through mediation, an individual final and binding arbitration proceeding, or a Small Claims Court action, except as otherwise expressly set forth in the DRP. The DRP may not be

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modified except in writing, or as otherwise permitted or required by the DRP or controlling law.

[3.] No. signature by me or any representative of any Alliance operating entity is required for the DRP to be binding on us. I can elect to not be bound by the DRP or its Chosen State Law (as defined therein) provisions by following the procedures set forth in its “Employee Election To Not Be Bound By DRP Or Chosen State Law” section of the DRP for giving the Alliance operating entities written notice of my election within 30 days of my receipt or notice of availability of the Handbook (whichever occurs first). If I do not follow those procedures, the Alliance operating entities and I will be required to arbitrate any Covered Disputes in accordance with the DRP. The Alliance operating entities do not have a preference as to whether I elect to not be bound by the DRP or its Chosen State Law provisions, I am not in fear of retaliation or reprisals (which is strictly prohibited by the Alliance operating entities), I can consult with independent legal counsel (at my own expense) about whether I should make such an election, no representations about the DRP have been made to me by the Alliance operating entities other than as set forth herein and in the DRP, and I will not rely on any representations about the DRP by the Alliance operating entities other than as set forth herein and in the DRP.

Handbook at 48-50.

Ms. Paltz allegedly signed this Acknowledgement electronically. MacPhail Decl. ¶¶ 12, 17-20.

On May 25, 2021, Ms. Paltz filed a memorandum in opposition to the motion to compel arbitration. See Pl. Kristen Paltz's Mem. of Law in Opp'n to Defs.' Mot. to Compel Arbitration of Pl.'s Claims, Appoint an Arbitrator, and Stay Proceeding Pending Ruling on Mot. and Completion of Arbitration, ECF No. 34 (May 25, 2021) (“Opp'n”).

In support of this motion, Ms. Paltz filed an affidavit stating that she “recall[s] signing something in January of 2020”, but does not know what was in the document. Ex. 1 to Pl. Kristen Paltz's Mem. of Law in Opp'n to Defs.' Mot. to Compel Arbitration of Pl.'s Claims, Appoint an Arbitrator, and Stay Proceeding Pending Ruling on Mot. and Completion of

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Arbitration ¶ 3, ECF No. 34-1 (May 25, 2021) (“Paltz Decl.”). She also declares, in the same affidavit, that she did not read the Handbook in full or know there was an arbitration agreement in it. Id. ¶ 5.

On June 8, 2021, the Defendants filed a memorandum in further support of their motion to compel arbitration. See Defs.' Reply Mem. in Supp. of Their Mot. to Compel Arbitration of Pl.'s Claims and Stay Proceedings Pending Ruling on Mot. and Completion of Arbitration, ECF No. 37 (June 8, 2021) (“Reply”).

II. STANDARD OF REVIEW

The Federal Arbitration Act (“FAA”) “establishes a national policy favoring arbitration when the parties contract for that mode of dispute resolution.” Preston v. Ferrer, 552 U.S. 346, 349 (2008). Section 2 of the FAA provides that “[a] written provision in . . . a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction . . . 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. Section 4 of the FAA enables any “party aggrieved” by the failure of another to arbitrate under a written agreement for arbitration to petition a United States District Court “for an order directing that such arbitration proceed in the manner provided for in such agreement.” Id. § 4.

Courts follow a two-part test to determine whether claims are subject to arbitration, considering “(1) whether the parties have entered into a valid agreement to arbitrate, and, if so, (2) whether the dispute at issue comes within the scope of the arbitration agreement.” In re Am. Express Fin. Advisors Sec. Litig., 672 F.3d 113, 128 (2d Cir. 2011). “A court may not deny arbitration where there is a valid arbitration agreement that covers the asserted claims.”

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