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Griffin v. Senior Living Properties, LLC

United States District Court, E.D. Texas, Tyler Division

August 29, 2017

DARLENE GRIFFIN, ET AL
v.
SENIOR LIVING PROPERTIES, LLC d/b/a LINDALE HEALTHCARE CENTER

          ORDER AND REASONS

         Before the Court is “Defendant Senior Living Properties, LLC D/B/A Lindale Healthcare Center's Motion to Compel Arbitration and Stay Proceedings.” Rec. Doc. 18. Plaintiff timely filed a response memorandum. Rec. Doc. 19. Defendant then filed a reply memorandum. Rec. Doc. 20. For the reasons discussed below, IT IS ORDERED that the motion (Rec. Doc. 18) is GRANTED.

         FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         This case arises out of alleged violations of the Fair Labor Standards Act (“FLSA”). Rec. Doc. 1 at ¶ 1. Specifically, Darlene Griffin (“Griffin”) worked for Senior Living Properties, LLC, doing business as Lindale Healthcare Center (“Defendant”). Id. at ¶¶ 1-3. In her original complaint, Griffin alleged that Defendant repeatedly violated FLSA Sections 6 and 7 by failing to pay her and similarly situated employees for the hours worked and by failing to pay her for overtime hours worked at a rate not less than one and one-half times the regular hourly rate of pay. Id. at ¶ 8. She accordingly requested “her unpaid wages, overtime, liquidated damages, all equitable relief, attorney fees, and litigation expenses/costs, including expert witness fees and expenses.” Id. at ¶ 1.

         On August 1, 2017, Plaintiff filed an amended complaint adding Tara Kumpe (“Kumpe”) as a Plaintiff. Rec. Doc. 13 at ¶ 2.

         Both Griffin and Kumpe signed arbitration agreements whereby they agreed “to voluntarily promise and irrevocably agree (after completing the facilities [sic] Problem Resolution Procedure) to arbitrate any dispute or claim arising or related to employment . . . .” Rec. Docs. 18-1 at 3; 18-2 at 3. The agreement further provides that it applies to “claims by employee[s] against the Company . . . including . . . [a]ny federal . . . laws . . . providing for the collection or recovery of unpaid wages, minimum wage or overtime pay, or prohibiting retaliation for making a wage claim.” Id.

         PARTIES' CONTENTIONS

         In response to Defendant's motion to compel arbitration, Plaintiffs argue (1) Defendant waived their right to compel arbitration by failing to timely raise the issue; (2) the agreements contain a mediation provision and “[n]either party has [the] right to compel arbitration when [the] agreement expressly requires mediation as a precondition for requesting arbitration and neither party has requested mediation”; and (3) the agreement is unconscionable and therefore cannot be enforced. Rec. Doc. 19 at 3.

         LAW AND ANALYSIS

         “Arbitration is favored in the law.” Grigson v. Creative Artists Agency, L.L.C., 210 F.3d 524, 526 (5th Cir. 2000) (citing Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983)). Section 2 of the Federal Arbitration Act (“FAA”) provides that “[a] written provision in any . . . 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.[1]

         According to the courts, § 2 “is a congressional declaration of a liberal federal policy favoring arbitration agreements, notwithstanding any state substantive or procedural policies to the contrary.” Moses H. Cone Mem'l Hosp., 460 U.S. at 24 (citing § 2). It was “Congress's clear intent . . . to move the parties to an arbitrable dispute out of court and into arbitration as quickly and easily as possible.” Id. at 22. Essentially, the FAA “establishes that, as a matter of federal law, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration” (id. at 24-25) and “where the contract contains an arbitration clause, there is a presumption of arbitrability” (Tittle v. Enron Corp., 463 F.3d 410, 418 (5th Cir. 2006) (quoting AT&T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643, 650 (1986)) (citing Primerica Life Ins. Co. v. Brown, 304 F.3d 469, 471 (5th Cir. 2002) (noting that any doubts regarding arbitrability should be resolved in favor of arbitration) (citing Southland Corp. v. Keating, 465 U.S. 1, 10 (1984)))).

         Nonetheless, § 2 contains a savings clause that provides that an agreement to arbitrate is “enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” § 2 (emphasis added). Accordingly, to determine if the parties agreed to arbitrate, the court should consider “(1) whether a valid agreement to arbitrate between the parties exist; and (2) whether the dispute in question falls within the scope of that arbitration agreement.” Pennzoil Expl. & Prod. Co. v. Ramco Energy Ltd., 139 F.3d 1061, 1065 (5th Cir. 1998) (citing Webb v. Investacorp, Inc., 89 F.3d 252, 258 (5th Cir. 1996); In re Hornbeck Offshore (1984) Corp., 981 F.2d 752, 754 (5th Cir. 1993); Midwest Mech. Contractors, Inc. v. Commonwealth Constr. Co., 801 F.2d 748, 750 (5th Cir. 1986)); see also Jones v. Haliburton Co., 583 F.3d 228, 233-34 (5th Cir. 2009) (citations omitted).[2] “If both questions are answered in the affirmative, our court then asks whether ‘any federal statute or policy renders the claims nonarbitrable.'” Jones, 583 F.3d at 234 (citations omitted).

         If a court is satisfied that a dispute is subject to arbitration pursuant to a written arbitration agreement, the court 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 agreement . . . .” 9 U.S.C. § 3.

         A. DID DEFENDANT WAIVE THE RIGHT TO COMPEL ARBITRATION?

         Parties may waive their right to arbitrate a dispute by “[1] substantially invok[ing] the judicial process [2] to the detriment or prejudice of the other party.” Nicholas v. KBR, Inc., 565 F.3d 904, 907 (5th Cir. 2009) (quoting Miller Brewing Co. v. Fort Worth Distrib. Co., 781 F.2d 494, 496-97 (5th Cir. 1986)). A party may “invoke the judicial process” by “initially pursuing litigation of claims then reversing course and attempting to arbitrate those claims” or by otherwise taking “some overt act in Court that evinces a desire to resolve the arbitrable dispute through litigation rather than arbitration.” Id. (quoting Gulf Guar. LifeIns. Co. v. Conn. Gen. Life Ins. Co., 304 F.3d 476, 484 (5th Cir. 2002)). A party is prejudiced by such an invocation if it resulted “in delay, extra expense, and/or damage to his legal position.” Cochran v. Nabors Drilling Techs. USA Inc., No. 16-1633, 2017 WL 2427794, at *2 (W.D. La. June 2, 2017) (citing In re Mirant Corp., 613 F.3d 584, 591 (5th Cir. 2010)). Three factors “are particularly relevant to the prejudice determination: (1) whether discovery occurred relating to arbitrable claims; (2) the time and expense incurred in ...


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