Pruiett v. West End Rests. LLC
| Decision Date | 14 November 2011 |
| Docket Number | Civil No. 3:11-00747 |
| Parties | ARON PRUIETT, ALLISON LOWRY, JERON BRAY, LATASIA WRIGHT, ROSANNE BARONE, LAUREN WILSON, AND ROBIN YARNALL, Plaintiffs, v. WEST END RESTAURANTS, LLC d/b/a BRICKTOP'S, INC. Defendant. |
| Court | U.S. District Court — Middle District of Tennessee |
MEMORANDUM AND ORDER
The defendant has submitted a Motion to Dismiss Or, in the Alternative, to Compel Arbitration (Docket No. 15) with a supporting memorandum (Docket No. 16), to which the plaintiffs have filed an opposition (Docket No. 30), and the defendants have filed a reply (Docket No. 34). The plaintiffs have also submitted a related Motion to Expedite Court-Supervised Notice (Docket No. 18).
The Plaintiffs are six current and former employees of the Defendant West End Restaurants, LLC d/b/a BrickTop's, Inc. ("BrickTop's"), a company that owns restaurants in the Tennessee area. (Docket No. 13 ¶ 3.) The Plaintiffs filed a collective action complaint, alleging that BrickTop's deprived the Plaintiffs and all others similarly situated of their right to a required minimum wage and their right to overtime pay, in violation of §§ 206(a)(1) and 207(a) of the Fair Labor Standards Act ("FLSA"). (Id.) The Plaintiffs demand restitution of the compensationalleged to have been unlawfully withheld, along with liquidated damages. (Id. at ¶ 19.) The parties agree on all relevant facts concerning the motion. The Plaintiffs each signed a "Mediation and Arbitration Agreement" (hereinafter "Agreement") when they were hired by BrickTop's. (Docket No. 17 ¶ 3.) The Agreement provides for alternative dispute resolution procedures to resolve any dispute "arising out of, relating to, or associated with the employee's employment" at BrickTop's, explicitly including claims under the FLSA. (Id., Ex. A, p. 2 at ¶ 2.) Under the Agreement, the parties must seek to resolve all employment-related disputes through confidential mediation before a third-party neutral mediator, conducted pursuant to the Rules and Procedures of the American Arbitration Association ("AAA"). (Id. at ¶ 1.) If a dispute cannot be resolved through mediation, the party who claims to be aggrieved has the right to initiate arbitration proceedings by filing a request for arbitration within 30 days of the date on which the mediation closed without resolution. (Id. at ¶ 3.) The arbitration must be conducted before a neutral arbitrator with experience in employment law matters, subject to AAA Rules and Procedures. (Id. at ¶ 4.) In the arbitration, the arbitrator must apply the substantive law that would be applicable in this court (id. at ¶ 2) and may award any type of relief that would be available in this court (id. at ¶ 6.) BrickTop's pays all reasonable costs of the mediation and/or arbitration, including filing fees and mediator and arbitrator expenses. (Id. at ¶ 7.) Any party asserting a claim must do so within one year of accrual, as follows:
5. Statute of Limitations: Any claim covered by this Agreement shall be filed no later than one year after the claim arises and if the statute of limitations for any claim is less than one year, any such claim must be filed no later than the statute of limitations for that claim.
(Id. at ¶ 5.) Finally, a severability clause provides that, "[i]f any provision in this Agreement isfound to be unenforceable, all other provisions will remain fully enforceable."1 (Id. at 9)
BrickTop's contends that, under the Agreement, the Plaintiffs' claims are subject to mandatory alternative dispute resolution, not a lawsuit. The Plaintiffs contend that the one-year limitations provision in the Agreement is unenforceable, and that, as a consequence, the entire Agreement is void. In response, BrickTop's argues that, even if the limitations provision is unenforceable, it is severable. The Plaintiffs have also requested issuance of expedited notice to a putative class of similarly situated plaintiffs, which BrickTop's opposes.2
Because BrickTop's has submitted and relied on materials outside the pleadings, the court will treat this motion as a motion for summary judgment pursuant to Fed. R. Civ. P. 56. See Dayco Corp. v. Goodyear Tire & Rubber Co., 523 F.2d 389, 392 (6th Cir. 1975); Gentry v. Home Quality Mgm't, Inc., No 4:06-CV-11, 2006 WL 1696953, at *1 (E.D. Tenn. June 16, 2006). Rule 56 requires the court to grant a motion for summary judgment if "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Here, the parties do not dispute any facts concerning the motion or the supporting affidavit submitted by BrickTop's. Thus, the court must decide whether BrickTop's is entitled to judgment as a matter of law on the undisputed facts presented.
The question whether the Plaintiffs' claims should be referred to arbitration is governed by the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1 et seq. (2011). The FAA provides that a party to a valid and enforceable arbitration agreement is entitled to a stay of federal court proceedings pending arbitration, and that a written arbitration agreement "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. A court must stay proceedings if an issue before the court is arbitrable under an agreement covered by the FAA, id. § 3, and the court must order arbitration if either party fails, neglects, or refuses to comply with the terms of an arbitration agreement, id. § 4.
The FAA manifests a liberal federal policy favoring arbitration agreements. Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 25, 111 S. Ct. 1647, 114 L. Ed. 2d 26 (1991); Morrison v. Circuit City Stores, Inc., 317 F.3d 646, 652-53 (6th Cir. 2003) (en banc). Accordingly, "as a matter of federal law, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration." 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); Morrison, 317 F.3d at 675. Nevertheless, "[b]y agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute; it only submits to their resolution in an arbitral, rather than a judicial, forum." Gilmer, 500 U.S. at 26 (emphasis added). Accordingly, an agreement to arbitrate is valid "so long as the prospective litigant effectively may vindicate [his or her] statutory cause of action in the arbitral forum."3 Green Tree Fin. Corp.-Ala. v. Randolph, 531U.S. 79, 90, 121 S. Ct. 513, 148 L. Ed. 2d 373 (2000), citing Gilmer, 500 U.S. at 28. However, even if an arbitration provision is unenforceable, the provision should be severed in favor of arbitration, unless the provision taints the entire agreement. Morrison, 317 F.3d at 675.
Under the FLSA, a plaintiff has two years to file a claim, unless the violation was willful, in which case the plaintiff has three years to file the claim. 29 U.S.C. § 255(a) (2011). Here, if enforced, the Agreement would shorten the statute of limitations on the Plaintiffs' FLSA claims to one year. The Plaintiffs contend that this limitation prevents BrickTop's employees from recovering full compensatory damages, thereby impermissibly denying them substantive rights conferred by the FLSA. Plaintiffs urge the court to adopt the reasoning of Wineman v. Durkee Lakes Hunting & Fishing Club, 352 F. Supp. 2d 815 (E.D. Mich. 2005), which, relying on the U.S. Supreme Court decision in Barrentine v. Ark.-Best Freight Sys., Inc., 450 U.S. 728, 101 S. Ct. 1437, 67 L. Ed. 2d 641 (1981), held that a six-month limitations on FLSA claims was unenforceable as against public policy. In response, BrickTop's urges the court to adopt the reasoning of Boaz v. Fed. Express Corp., 742 F. Supp. 2d 925 (W.D. Tenn. 2010), which rejected Wineman and found that a six-month contractual limitation on FLSA claims was enforceable, in part based on the U.S. Supreme Court's post-Wineman decision in 14 Penn Plaza LLC v. Pyett, 556 U.S. 247, 129 S. Ct. 1456, 173 L. Ed. 2d 398 (2009).
As an initial matter, neither the U.S. Supreme Court decision in Barrentine nor the subsequent U.S. Supreme Court decision in Penn Plaza control the issues presented here. In Barrentine, the Court found that, where an employee had not agreed to arbitrate statutory claims,arbitration of contract-based claims did not preclude subsequent judicial resolution of statutory claims based on the same underlying facts. See Penn Plaza, 129 S. Ct. at 1468 (characterizing Barrentine)4 Here, there is no dispute that the Agreement covers FLSA claims, so Barrentine is inapplicable. In Penn Plaza, the Court held that federal statutory claims were arbitrable under a collective bargaining agreement. 129 S. Ct. at 1461. In reaching this holding, the Court found that, absent Congressional preclusion of the arbitral forum, the right to judicial resolution of federal statutory claims was not a substantive right. Id. at 1465. The Court did not address whether the waiver of any other rights conferred by a federal statute, such as the statute of limitations, constituted an impermissible waiver of a substantive right. Thus, Penn Plaza is inapplicable on the issue of whether the FLSA statute of limitations may be abridged.
An agreement to arbitrate is valid "so long as the prospective litigant effectively may vindicate [his or her] statutory cause of action in the arbitral forum." Green Tree, 531 U.S. at 90; accord Morrison, 317 F.3d at 658. The Sixth Circuit's decision in Morrison, which applied the Green Tree standard...
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