Seme v. Gibbons, P.C., CIVIL ACTION NO. 19-857
| Decision Date | 26 June 2019 |
| Docket Number | CIVIL ACTION NO. 19-857 |
| Parties | JENNIFER SEME v. GIBBONS, P.C. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Plaintiff Jennifer Seme commenced this employment discrimination action against her former employer, Defendant law firm Gibbons, P.C., asserting claims of gender discrimination pursuant to Title VII, the Pennsylvania Human Relations Act ("PHRA"), and the Philadelphia Fair Practice Ordinance. Defendant filed a Motion to Compel Arbitration and Stay the Action, pursuant to the Federal Arbitration Act ("FAA"), 9 U.S.C. §§ 1-16, asserting that the claims Plaintiff raises are subject to a valid arbitration agreement. For the following reasons, we grant Defendant's Motion.
Defendant hired Plaintiff on or about March 8, 2010 as a lateral associate. (Compl. ¶ 19.) At the time of her hiring, Plaintiff had been a licensed attorney for approximately four years. (See id. ¶ 18.)
Prior to the start of her employment, on February 22, 2010, Plaintiff signed an "Agreement to Mediate and Arbitrate Claims" (the "Arbitration Agreement"). The Arbitration Agreement states that the parties:
consent to the resolution by arbitration of those claims, which include, but are not limited to: . . . claims alleging discrimination or harassment on any legally protected basis, . . . claims alleging wrongful termination, . . . and any other claims alleging any violation of any federal, state or other governmental law, statute, regulations or ordinance.
(Id. ¶ 4(A).) It also states that the parties "mutually agree to forego their respective right to a jury trial and agree to resolve any and all disputes through arbitration" and that "[t]he parties expressly designate the American Arbitration Association ("AAA") to administer any mediation and/or arbitration brought pursuant to this Agreement." (Id. ¶¶ 1- 2.)
According to the Complaint, throughout her eight years of employment with Defendant, Plaintiff was subjected to a sex-biased pay and promotion system that advantaged male attorneys and disadvantaged female attorneys. (Compl. at 1.) In that regard, the Complaint alleges, inter alia, that Plaintiff was paid less than her male peers, was disadvantaged by Defendant's practice of favoring male attorneys in assigning client-origination credit, and was denied promotion because of her gender. The Complaint further alleges that, in spite of Plaintiff's complaints, Defendant repeatedly failed to rectify the gender-based inequities in pay and promotion. (Id. ¶¶ 34-35, 37-41, 43-44.) On or about July 18, 2018, Plaintiff was notified that her employment would be terminated. (Id. ¶ 63.) Defendant asked Plaintiff to stay on until September on the condition that she sign a Separation and Release Agreement that released Defendant from all legal claims in connection with her employment, but Plaintiff refused. (Id. ¶¶ 67, 70.) Defendant therefore terminated Plaintiff's employment effective August 9, 2018. (Id. ¶ 70.)
Plaintiff filed her Complaint against Defendant on February 27, 2019. The Complaint asserts claims of gender discrimination pursuant to Title VII, the PHRA, and the Philadelphia Fair Practices Ordinance. On March 8, 2019, Defendant filed the instant Motion to Compel Arbitration and to Stay this Action, arguing that the claims raised the Complaint are subject to the Arbitration Agreement.
Whether a district court considers a motion to compel arbitration under a Federal Rule of Civil Procedure 12(b)(6) standard or a summary judgment standard depends on whether the Complaint sets forth the basis for arbitration. "[W]hen it is apparent, based on 'the face of a complaint, and documents relied upon in the complaint,' that certain of a party's claims 'are subject to an enforceable arbitration clause, a motion to compel arbitration should be considered under a Rule 12(b)(6) standard . . . .'" Guidotti v. Legal Helpers Debt Resolution, L.L.C., 716 F.3d 764, 776 (3d Cir. 2013) (quoting Somerset Consulting, LLC v. United Capital Lenders, LLC, 832 F. Supp. 2d 474, 482 (E.D. Pa. 2011)). On the other hand, "a Rule 12(b)(6) standard is inappropriate when . . . 'the motion to compel arbitration does not have as its predicate a complaint with the requisite clarity' to establish on its face that the parties agreed to arbitrate." Id. at 774 (quoting Somerset, 832 F. Supp. 2d at 482). Under the latter circumstances, we "use the summary judgment standard under Rule 56(a), in which 'the motion [to compel] should be granted where there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.'" Maddy v. Gen. Elec. Co., 629 F. App'x 437, 440 (3d Cir. 2015) (internal quotation marks omitted) (quoting Flintkote Co. v. Aviva PLC, 769 F.3d 215, 219 (3d Cir. 2014)); see also Fed. R. Civ. P. 56(a). An issue is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is "material" if it "might affect the outcome of the suit under the governing law." Id.
In this case, the Complaint does not make reference to any arbitration agreement. Rather, Defendant first raises the existence of an arbitration agreement in its Motion to Compel, and it attaches the Arbitration Agreement executed by the parties to its Motion. Both Defendant andPlaintiff also rely on factual evidence outside of the pleadings in arguing that arbitration is or is not appropriate. We therefore apply a summary judgment standard to resolution of Defendant's Motion.
Defendant argues in its Motion that, pursuant to both the FAA and the parties' Arbitration Agreement, we should stay this action and compel Plaintiff to arbitrate her claims before the AAA. Plaintiff does not dispute that she and Defendant entered into the Arbitration Agreement and that, on its face, the Agreement would cover the claims at issue. She argues, however, that the Agreement is unenforceable because it is procedurally and substantively unconscionable.1 She argues in the alternative that we should permit her the opportunity to conduct discovery regarding the validity of the agreement.
"[W]hen a party resists arbitration under an existing arbitration clause[,] . . . the FAA allows a district court to compel . . . arbitration . . . ." John Hancock Mut. Life Ins. Co. v. Olick, 151 F.3d 132, 136 (3d Cir. 1998) (citing 9 U.S.C. §§ 3, 4; PaineWebber, Inc. v. Hartmann, 921 F.2d 507, 511 (3d Cir. 1990)). Specifically, Section 4 of the FAA provides as follows:
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 which, save for such agreement, would have jurisdiction under title 28, . . . for an order directing that such arbitration proceed in the manner provided for in such agreement.
9 U.S.C. § 4. Furthermore, the FAA provides that when the court refers a case to arbitration pursuant to the FAA, it "shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the [parties' arbitration] agreement." Id. § 3.
"Under the [FAA], arbitration is a matter of contract, and courts must enforce arbitration contracts according to their terms." Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524, 529 (2019) (citing Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63, 67 (2010)). In determining "whether a party may be compelled to arbitrate under the FAA, we first consider '(1) whether there is a valid agreement to arbitrate between the parties and, if so, (2) whether the merits-based dispute in question falls within the scope of that valid agreement.'" Flintkote, 769 F.3d at 220 ).
"'Questions concerning the interpretation and construction of arbitration agreements are determined by reference to federal substantive law.'" Gay v. CreditInform, 511 F.3d 369, 388 (3d Cir. 2007) (quoting Harris v. Green Tree Fin. Corp., 183 F.3d 173, 179 (3d Cir. 1999)) (additional citation omitted). However, contract defenses that arise under state law, "'such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements without contravening § 2 [of the FAA].'" Id. (quoting Doctor's Assocs., Inc. v. Casarotto, 517 U.S. 681, 687 (1996)). "Unconscionability is a 'defensive contractual remedy which serves to relieve a party from an unfair contract or from an unfair portion of a contract.'" Harris, 183 F.3d at 181 (quoting Germantown Mfg. Co. v. Rawlinson, 491 A.2d 138, 145 (Pa. Super. Ct. 1985)). "To prove unconscionability under Pennsylvania law, a party must show that the contract was both substantively and procedurally unconscionable." Quilloin v. Tenet HealthSystem Philadelphia,Inc., 673 F. 3d 221, 230 (3d Cir. 2012) (citing Salley v. Option One Mortg. Corp., 925 A.2d 115, 116 (Pa. 2007)).
"'Procedural unconscionability pertains to the process by which an agreement is reached and the form of an agreement . . . .'" Alexander v. Anthony Int'l., L.P., 341 F.3d 256, 265 (3d Cir. 2003) (quoting Harris, 183 F.3d at 181). "A contract is procedurally unconscionable where 'there was a lack of meaningful choice in the acceptance of the challenged provision[.]'" Quilloin, 673 F.3d at 235 (alteration in original) (quoting Salley, 925 A.2d at 119). It will therefore "be deemed procedurally unconscionable when formed through 'oppression and unfair surprise.'" Id. (quoting Witmer v. Exxon Corp., 434 A.2d 1222, 1228 n.16 (Pa. 1981)). The requirement of procedural unconscionability "is generally satisfied if the agreement constitutes a contract of adhesion."...
To continue reading
Request your trial