Sewell v. Waitr Holdings, Inc.
| Decision Date | 13 January 2020 |
| Docket Number | CASE NO. 2:19-CV-00698 |
| Parties | GREGORY SEWELL v. WAITR HOLDINGS, INC. |
| Court | U.S. District Court — Western District of Louisiana |
Pending before the Court is Defendant Waitr Holdings, Inc.'s ("Waitr") Motion to Compel Arbitration and Dismiss Complaint [Doc. No. 7]. Plaintiff Gregory Sewell ("Sewell") filed an opposition memorandum. [Doc. No. 9]. Waitr filed a reply memorandum. [Doc. No. 13].
For the following reasons, the Motion to Compel Arbitration and Dismiss Complaint is GRANTED IN PART AND DENIED IN PART.
Waitr is a Louisiana-based technology company that operates an online food order and delivery platform that allows its patrons to use mobile or desktop applications to order food and have it delivered from participating restaurants.
On April 13, 2017, Waitr hired Sewell as a City Manager. In connection with and in consideration for his employment, Sewell signed an offer letter. That offer letter contained the following provision:
In the event of any dispute or claim relating to or arising out of our employment relationship, you and the Company agree that (i) any and all disputes between you and the Company shall be fully and finally resolved by binding arbitration, (ii) you are waiving any and all rights to a jury trial but all court remedies will be available in arbitration, (iii) all disputes shall be resolved by a neutral arbitrator who shall issue a written opinion and (iv) the arbitration shall provide for adequate discovery.
[Doc. No. 7-3, Declaration of Amy Behne ("Behne Declaration"), Exh. 2, ¶ 5 & Tab A].
On February 27, 2018, Waitr promoted Sewell to Business Manager of Excellence. Sewell received a second offer letter regarding this position that did not include any arbitration terms. [. Sewell signed that letter on March 3, 2018.
On November 16, 2018, Waiter distributed an Agreement to Arbitrate Claims. This agreement was emailed through his @waitrapp.com email address.1 The Agreement to Arbitrate Claims was also communicated through a public group chat channel ("Discord") and an internal messaging platform ("Slack"). [Doc. No. 9, Exh. C., Affidavit of Chad Murray, ¶¶ 16 & 17]. That Agreement provides as follows:
In consideration of the at-will employment relationship between Waitr, Inc. and/or Waitr Holdings, Inc. ("Employer") and Employee and the mutual desire of the parties to enter into this Agreement to Arbitrate Claims ("Agreement"), the parties hereby agree that any and all disputes, claims or controversies between the parties, including but not limited to any dispute arising out of or relating to this Agreement, the employment relationship between the parties, or the formation or termination of the employment relationship, or which arise after the termination of the employment relationship, which are not resolved by their mutual agreement shall be resolved by final and binding arbitration by a neutral arbitrator.
. . .
The claims covered by this Agreement include, but are not limited to, claims for . . . violation of any local, state, or federal constitution, statute, law, ordinance or regulation . . . wages, overtime, premiums, gratuities, tips, service/administrative charges, or any other compensation due; penalties . . . .
[Doc. No. 7-3, Behne Declaration, Exh. 2, ¶ 7 & Tab B].
The Agreement to Arbitrate Claims further provides:
I ACKNOWLEDGE THAT I HAVE HAD AN OPPORTUNITY TO REVIEW AND ASK QUESTIONS CONCERNING THIS AGREEMENT AS A CONDITION OF EMPLOYMENT. I UNDERSTAND THAT I AM PERMITTED TO TAKE THIS AGREEMENT WITH ME AND REVIEW IT WITH AN ATTORNEY OF MY CHOICE IF I SO DESIRE. I FURTHER UNDERSTAND THAT BY CONTINUING TO WORK FOR COMPANY, MY CONTINUED EMPLOYMENT WILL BE CONSIDERED ACCEPTANCE OF THE AGREEMENT, EVEN WITHOUT SIGNATURE.
Id. (emphasis in original). The Agreement to Arbitrate Claims expressly applies only to disputes that otherwise would be resolved in a court of law; it does not extend to claims or matters that may be brought before an administrative agency or purport to limit the employee's rights before administrative agencies. Id.
Pursuant to the Agreement to Arbitrate Claims, arbitration proceedings are to be held within geographic proximity to the employee; the arbitrator is to be selected by mutual agreement of the parties; and Waitr agrees to pay the arbitrator's and arbitration fees. Id. The Agreement to Arbitrate Claims provides for the same rights to conduct discovery, bring dispositive motions, and submit evidence and call witnesses that the parties would enjoy in a court of law. Id.
Sewell did not sign the Agreement to Arbitrate Claims, but does not deny that he received it. (In fact, he forwarded the e-mail to a former Waitr employee, Chad Murray, on December 19, 2018). [Doc. No. 7-3, Behne Declaration, ¶ 7]. Sewell never made any objection to or refused any of the terms in the original offer letter or the Agreement to Arbitrate Claims.
On April 1, 2019, Waitr terminated Sewell's employment, contending that he had a series of performance issues and had failed to satisfy the requirements of his performance improvementplan ("PIP"). Sewell denies that he was terminated for performance issues and instead contends that he was harassed and his employment ultimately terminated because he made complaints about violations of the Fair Labor Standards Act., 29 U.S.C. §§ 201-219 ("FLSA").
On May 31, 2019, Sewell filed his Complaint in this Court, bringing suit under the FLSA and state law. [Doc. No. 1].
On June 28, 2019, Sewell filed a second lawsuit in the Fifteenth Judicial District Court, Lafayette Parish, Louisiana, seeking unpaid wages, penalties, and attorneys' fees under the Louisiana Wage Payment Act, LA REV. STAT. §§ 23:631-632. See Gregory Sewell v. Waitr Holdings, Inc., Case No. 2019-3964, 15th Judicial District Court, Parish of Lafayette, State of Louisiana. Waitr filed an Exception of Prematurity, and, on August 12, 2019, the state court sustained the objection and required Sewell to pursue his claims in arbitration. The state court action was dismissed.
On September 13, 2019, Waitr filed the instant motion. The motion is now fully briefed, and the Court is prepared to rule.
The Federal Arbitration Act, 9 U.S.C. §§ 1, et seq. ("FAA"), is the substantive law controlling the validity and enforcement of arbitration agreements. Walton v. Rose Mobile Homes LLC, 298 F.3d 470, 473 (5th Cir. 2002). The FAA provides that written agreements to settle controversies by arbitration "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; see also Walton, 298 F.3d at 473. Additionally, "[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 mannerprovided for in such agreement." 9 U.S.C. § 4. However, the FAA also has a "saving clause [that] allows courts to refuse to enforce arbitration agreements 'upon such grounds as exist at law or in equity for the revocation of any contract.'" Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612, 1622 (2018) (quoting § 2). "The clause 'permits agreements to arbitrate to be invalidated by 'generally applicable contract defenses, such as fraud, duress, or unconscionability.'" Id. (quoting ATT Mobility, LLC v. Concepcion, 563 U.S. 333, 339 (2011)).
Courts consider two factors in ruling on a motion to compel arbitration: "(1) whether a valid agreement to arbitrate between the parties exists; and (2) whether the dispute in question falls within the scope of that arbitration agreement." Painewebber Inc. v. Chase Manhattan Private Bank (Switz.), 260 F.3d 453, 462 (5th Cir. 2001) (internal quotation marks and citation omitted); see also Sharpe v. AmeriPlan Corp., 769 F.3d 909, 914 (5th Cir. 2014) (quoting Sherer v. Green Tree Servicing, LLC, 548 F.3d 379, 381 (5th Cir. 2008). "[T]here is a strong presumption in favor of arbitration and a party seeking to invalidate an arbitration agreement bears the burden of establishing its invalidity." Carter v. Countrywide Credit Indus., 362 F.3d 294, 297 (5th Cir. 2004) (citing Gilmer v. Interstate/ Johnson Lane Corp., 500 U.S. 20, 26 (1991)); see also 9 U.S.C. § 4.
"The first step of the analysis—the validity of an agreement—is governed by state law contract principles." Sharpe, 769 F.3d at 914 (citing Klein v. Nabors Drilling USA L.P., 710 F.3d 234, 236 (5th Cir. 2013)). Under Louisiana law, parties may reciprocally bind themselves to arbitration agreements. LA CIV. CODE ANN. ARTS. 3099-3100 (2015). Such agreements are "valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." LA. STAT. ANN. § 9:4201 (2009).
It is undisputed that Sewell signed the April 13, 2017 offer letter containing an arbitration agreement; that Sewell received the Agreement to Arbitrate Claims which was sent via email on or about November 16, 2018; that Sewell continued his employment after receipt of the Agreement to Arbitrate; and that Sewell failed to raise any objections to the Agreement to Arbitrate or to the arbitration provisions in the original offer letter prior to filing this lawsuit.
However, Sewell contends that the Court should not compel arbitration because the original offer letter was superseded by the February 27, 2018 promotion letter, which did not contain arbitration provisions. Additionally, Sewell argues that the November 2018 Agreement to Arbitrate Claims did not create an enforceable arbitration agreement because he did not expressly accept the Agreement to Arbitrate Claims, and tacit acceptance should not be inferred. Finally, Sewell contends that the...
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