Quilloin v. Tenet Healthsystem Philadelphia Inc.

• Decision Date: 20 January 2011
• Docket Number: Civil Action No. 09–5781.
• Citation: 763 F.Supp.2d 707
• Parties: Janice QUILLOIN, an individual, on behalf of herself and others similarly situated, Plaintiff,v.TENET HEALTHSYSTEM PHILADELPHIA, INC., Tenet Healthcare Corporation, and Tenet HealthSystem Hahnemann, LLC, Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

763 F.Supp.2d 707

Janice QUILLOIN, an individual, on behalf of herself and others similarly situated, Plaintiff,

v.TENET HEALTHSYSTEM PHILADELPHIA, INC., Tenet Healthcare Corporation, and Tenet HealthSystem Hahnemann, LLC, Defendants.

Civil Action No. 09–5781.

United States District Court, E.D. Pennsylvania.

Jan. 20, 2011.

Gary F. Lynch, New Castle, PA, Gerald D. Wells, III, Faruqi & Faruqi, Jenkintown, PA, Trevan P. Borum, Philadelphia, PA, for Plaintiff.Christina Tellado–Winston, James N. Boudreau, Greenberg Traurig LLP, Michele Halgas Malloy, Littler Mendelson PC, Philadelphia, PA, for Defendants.

MEMORANDUM

ANITA B. BRODY, District Judge.

Plaintiff Janice Quilloin (“Plaintiff” or “Quilloin”) has brought a nationwide collective ¹ action under the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201– 19 (2006), and a state-wide class action under the Pennsylvania Minimum Wage Act of 1968, 43 Pa. Cons.Stat. §§ 333.101–333.115 (2009); the Pennsylvania Wage Payment and Collection Law, 43 Pa. Cons.Stat. §§ 260.1–260.12 (2009); and Pennsylvania common law against Defendants Tenet HealthSystem Philadelphia (“Tenet Philadelphia”), Tenet Healthcare Corporation (“Tenet”), and Tenet HealthSystem Hahnemann, LLC (“Hahnemann”) (collectively, “Defendants”). First Am. Compl. 1–2, ECF No. 19. Plaintiff alleges that Defendants forced her and others to work through their meal breaks without pay. Id. This court has jurisdiction pursuant to the FLSA; the Class Action Fairness Act of 2005, 28 U.S.C. § 1332(d)(2) (2006); and 28 U.S.C. § 1367 (2006). In response, Defendants have filed a motion to dismiss or, in the alternative, to stay proceedings and compel compliance with an agreement to arbitrate. Mot. Dismiss, June 10, 2010, ECF No. 28.² For the reasons set forth below, I will deny Defendants' motion without prejudice.

I. Background ³

Plaintiff is a Registered Nurse with an Associate Degree in the Science of Nursing. Quilloin Decl. ¶¶ 3–4, ECF No. 34. She worked at Hahnemann University Hospital from October of 2006 until February of 2008, and then again from December of 2008 until November of 2009. Id. ¶¶ 8, 11; First Am. Compl. ¶ 10, ECF No. 19. Defendant Hahnemann owns Hahnemann University Hospital. Simmons Decl. ¶ 2, ECF No. 28. Defendant Tenet Philadelphia helps manage and control two hospitals in Philadelphia, including Hahnemann University Hospital. First Am. Compl. ¶ 14, ECF No. 19. Hahnemann and Tenet Philadelphia are both subsidiaries of Defendant Tenet, a health care services company whose subsidiaries, as of December 31, 2008, operated a total of 55 hospitals with over 14,000 beds. Id. ¶¶ 12–15.

Defendants maintain a “Meal Break Deduction Policy” at all of their facilities, according to which the computerized time and attendance system automatically deducts a thirty-minute meal period per work shift. Id. ¶¶ 26, 27. However, Quilloin alleges that she and other members of the classes often performed compensable work during their uncompensated meal breaks. Id. ¶ 29.

Thus Quilloin seeks to bring the FLSA collective action on behalf of herself and “[a]ll persons employed within the three years preceding the filing of this action by Defendant whose pay was subject to an automatic 30 minute meal period deduction even when they performed compensable work during the unpaid ‘meal break.’ ” Id. ¶ 45.

She similarly seeks to bring a state law class action on behalf of herself and “[a]ll persons employed within the three years preceding the filing of this action by Defendants at any of its Pennsylvania facilities, whose pay was subject to an automatic 30 minute meal period deduction even when they performed compensable work during the unpaid ‘meal break.’ ” Id. ¶ 46.

On December 4, 2009, Quilloin filed suit in this court against Tenet and Tenet Philadelphia. On February 19, 2010, Tenet Philadelphia answered, and asserted as an affirmative defense the existence of an agreement to arbitrate employee disputes with the employer. Answer 8–9, Feb. 19, 2010, ECF No. 9. Also on February 19, 2010, Tenet filed a motion to dismiss for lack of personal jurisdiction, alleging that it was four corporate layers removed from Quilloin's actual employer and lacked minimum contacts with Pennsylvania. Mem. Supp. Mot. Dismiss 1–2, Feb. 19, 2010, ECF No. 10. On March 15, 2010, Quilloin responded to Tenet's Motion to Dismiss, and on March 29, 2010, Tenet replied to Quilloin's response.

On April 15, 2010, the parties attended a Rule 16 conference. On April 21, 2010, the parties submitted a joint stipulation, according to which Plaintiff would voluntarily dismiss another pending case, Janice Quilloin v. Tenet HealthSystem Philadelphia, Inc. et al., No. 10–1379, and amend her complaint in this matter to include those Pennsylvania state law claims asserted in the other matter. Joint Stipulation ¶¶ 1–2, Apr. 21, 2010, ECF No. 18. The parties further stipulated that such amendment would not moot the pending motion to dismiss for lack of personal jurisdiction, and that the parties would conduct jurisdictional discovery by July 15, 2010. Id. ¶¶ 4–5.

On April 23, 2010, Plaintiff filed her first amended complaint against Tenet, Tenet Philadelphia, and Hahnemann. See First Am. Compl., ECF No. 19. On May 13, 2010, Tenet Philadelphia and Hahnemann answered, again invoking Plaintiff's agreement to arbitrate as an affirmative defense. Answer 14, May 13, 2010, ECF No. 25.

On June 10, 2010, Tenet, Tenet Philadelphia, and Hahnemann filed a motion to dismiss or, in the alternative, to stay proceedings and compel compliance with the agreement to arbitrate. Mot. Dismiss, June 10, 2010, ECF No. 28. Six days later, Defendants filed a motion for a protective order in response to allegedly extensive discovery requests from Plaintiff. Mot. Protective Order, ECF No. 29.

Following a telephone conference on August 12, 2010, Tenet withdrew its motion to dismiss for lack of personal jurisdiction, which mooted Defendants' motion for a protective order. Notice, Aug. 13, 2010, ECF No. 42. Thus, all that remains for my consideration is Defendant's June 10th motion to dismiss or, in the alternative, to stay proceedings and compel compliance with the agreement to arbitrate.

Around the time when Quilloin began her periods of employment, in October of 2006 and in January of 2009,⁴ she signed an acknowledgment form stating:

I hereby voluntarily agree to use the Company's Fair Treatment Process and to submit to final and binding arbitration any and all claims and disputes that are related in any way to my employment or the termination of my employment with Tenet. I understand that final and binding arbitration will be the sole and exclusive remedy for any such claim or dispute against Tenet or its parent, subsidiary or affiliated companies or entities, and each of its and/or their employees, officers, directors or agents, and that, by agreeing to use arbitration to resolve my dispute, both the Company and I agree to forgo any right we each may have had to a jury trial on issues covered by the Fair Treatment Process.Reply Ex. A, ECF No. 39.⁵ Quilloin has stated that she was given no time to review the document, that she was not permitted an opportunity to have it reviewed by counsel, that she was presented with the form on a “take it or leave it basis,” and that she had no choice but to sign given her need to financially support herself. Resp. 4, ECF No. 33; Quilloin Decl. ¶¶ 15–19, ECF No. 34.

The Fair Treatment Process (FTP) states that it

[a]pplies to all employees, regardless of length of service or status, and covers all disputes relating to or arising out of an employee's employment with the company or the termination of employment. The only disputes or claims not covered by the FTP are those listed in the “Exclusions and Restrictions” section below. Examples of the type of disputes or claims covered by the FTP include claims for wrongful termination of employment, breach of contract, employment discrimination, harassment or retaliation under the Americans With Disabilities Act, the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964 and its amendments or any state or local discrimination laws, tort claims, or any other legal claims and causes of action recognized by local, state or federal law or regulations.

Mot. Dismiss Ex. B at 1, ECF No. 28. In the “Exclusions and Restrictions” section, the FTP reads:

any non-waivable statutory claims ... are not subject to exclusive review under the FTP. This means that you may file such non-waivable statutory claims with the appropriate agency that has jurisdiction over them if you wish, regardless of whether you decide to use the FTP to resolve them. However, if such an agency completes its processing of your action against the company, you must use the FTP if you wish to pursue your claim (although Steps 1 through 4 may be skipped).

Id. at 7. Steps 1 through 3 require employees to proceed through the corporate hierarchy before filing a claim in arbitration. At each step, a response “will be provided ... as soon as possible, usually within seven calendar days.” Id. at 3. At Step 4, the dispute is heard by a committee “as soon as possible, usually within 30 days.” Id. at 4. If an employee does not accept the committee's decision, he or she can submit the dispute to arbitration. Describing the arbitration process, the FTP states:

The arbitration will be administered by the American Arbitration Association (“AAA”). The company and you will share the cost of AAA's filing fee and the arbitrator's fees and costs, but your share of such costs shall not exceed an amount equal to one day's pay (for exempt employees), or eight times your hourly rate (for non-exempt employees), or your local court civil filing fee, whichever is less. You and the company will be responsible for the fees and costs of your own respective legal counsel, if any, and any other expenses and costs, such as costs associated with...