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McKinnon v. Hobby Lobby Stores, Inc.

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

May 15, 2019

BRANDY R. MCKINNON, Plaintiff,
v.
HOBBY LOBBY STORES, INC., ET AL, Defendants.

          MEMORANDUM ORDER

          ROY S. PAVNE, UNITED STATES MAGISTRATE JUDGE

         In this pro se[1] disability action, Defendant Hobby Lobby Stores, Inc. moves to compel arbitration in this action based upon an arbitration agreement entered into by Plaintiff Brandy McKinnon (Dkt. 46). Because this action is allegedly arbitrable, Defendant Hobby Lobby Stores, Inc. also asks the Court to stay this action pending arbitration. (Dkt. Nos. 46, 22, and 37).

         BACKGROUND

         McKinnon was formerly employed by Defendant Hobby Lobby Stores, Inc. ("Hobby Lobby") in Longview, Texas from August 1997 until her termination on November 14, 2014 (Dkt. No. 1-1). In 2010, McKinnon received the Hobby Lobby's March 2010 Employee Handbook (Dkt. No. 46-2). The Handbook states, in relevant part:

All employees and the Company [Hobby Lobby] mutually agree to submit all employment-related legal disputes [...] between any employee and the Company to binding arbitration. All Company employees are required to sign and return a Mutual Arbitration Agreement as a condition of their employment and continued employment. The Mutual Arbitration Agreement is included at the end of this Employee Handbook.

(Dkt. No. 46-1). The Handbook provides that arbitration shall be conducted pursuant to the American Arbitration Association's National Rules for the Resolution of Employment Disputes or the Institute for Christian Conciliation's Rules of Procedure for Christian Conciliation. Id. The Handbook also notes that employees could review the arbitration rules and procedures by either requesting copies from the employee's supervisor or the human resources department or visiting the arbitration provider organization's websites. Id. McKinnon signed the Employee Handbook Receipt and Acknowledgement Form on April 26, 2010. See (Dkt. No. 46-2). Signing the Acknowledgement Form is said to be an acknowledgement that an employee received a copy of the Handbook and understood that the employment relationship with Hobby Lobby was at-will. See Id. McKinnon concedes that she signed the Acknowledgment Form.

         McKinnon also concedes that she signed a "Mutual Arbitration Agreement" ("MAA") on April 26, 2010. See (Dkt. No. 46-3). The MAA reads, in part:

This Agreement between Employee [McKinnon] and Company [Defendant Hobby Lobby] to arbitrate all employment-related Disputes includes, but is not limited to, all Disputes under or involving Title VII of the Civil Rights Act of 1964, the Civil Rights Act s of 1866 and 1991, the Age Discrimination in Employment Act, the Americans with Disabilities Act [...] and all other federal, state, and municipal statutes, regulations, codes, ordinances, common laws, or public policies that regulate, govern, cover, or relate to equal employment, wrongful termination, [...] defamation, [...], pain and suffering, emotional distress, [...] harassment and/or discrimination based on any class protected by federal, state or municipal law, or interference and/or retaliation involving [...] harassment, discrimination, or the opposition of harassment or discrimination, and any other employment-related Dispute in tort or contract. [...] By agreeing to arbitrate all Disputes, Employee and Company understand that they are not giving up any substantive rights under federal, state, or municipal law (including the right to file claims with federal, state, or municipal government agencies). Rather, Employee and Company are mutually agreeing to submit all Disputes contemplated in this Agreement to arbitration, rather than to a court. [... ] Employee and Company acknowledge that they have read this Mutual Arbitration Agreement, are giving up any right they might have at any point to sue each other, are waiving any right to a jury trial, and are knowingly and voluntarily consenting to all terms and conditions set forth in this Agreement. [... ] Ever individual who works for [Hobby Lobby] must have signed and returned to his/her supervisor this Agreement to be eligible for employment and continued employment with [Hobby Lobby]. [... McKinnon and Hobby Lobby] acknowledge that they have read this Mutual Arbitration Agreement, are giving up any right they might have at any point to sue each other, are waiving any right to a jury trial, and are knowing and voluntarily consenting to all terms and conditions set forth in this Agreement.

Id. Like the Handbook, the MAA provides that arbitration shall be conducted pursuant to the American Arbitration Association's National Rules for the Resolution of Employment Disputes or the Institute for Christian Conciliation's Rules of Procedure for Christian Conciliation. Id. The Handbook states that Hobby Lobby "shall bear the administrative costs and fees assessed by the arbitration provider selected by [McKinnon]: either the Employment Arbitration Rules and Mediation Procedures or the Institute for Christian Conciliation. [Hobby Lobby] shall be responsible for paying the arbitrator's fees." Id.

         On May 2, 2018, McKinnon filed suit against Hobby Lobby and her former store manager, Defendant Kim Greenlee, alleging that she was wrongfully terminated on the basis of her disability and retaliated against in violation of the Americans with Disabilities Act, 42 US.C. § 12113 etseq. (the "ADA") and Title VII of the Civil Rights Act of 1964. (Dkt. No. 1). McKinnon also brings claims for libel and slander. Id.

         Hobby Lobby contends that McKinnon is bound by the MAA because she signed the MAA, provided written acknowledgement of Hobby Lobby's Employee Handbook and its arbitration policy, and continued her at-will employment. (Dkt. No. 46 at 7). Because this action is arbitrable, according to Hobby Lobby, this action must be stayed until arbitration is complete under the Federal Arbitration Act, 9 U.S.C. § 3 (the "FAA") because all of McKinnon's claims are subject to arbitration. Id. Although McKinnon acknowledges that she was "willing at a time for [sic] Arbitration and Mediation," (Dkt. No. 23 at 3), McKinnon now opposes arbitration, arguing that she was 17 years old when she was "told to shut up and sign" the MAA to obtain her paycheck. (Dkt. No. 49 at 1-2). McKinnon further argues that Hobby Lobby's attempt to compel arbitration is untimely because the MAA provides that arbitration may not be initiated within one year of the day the dispute arose. See Id. at 7; (Dkt. No. 23 at 2).

         DISCUSSION

         Rather than submitting their dispute to a court, parties may seek alternative methods of resolving their dispute. One process of "alternative dispute resolution" is mediation, a process where the parties meet with an impartial and neutral person who assists the parties in negotiating their differences. Another traditional form of alternative dispute resolution is arbitration. Arbitration is an adjudicatory procedure in which a neutral third party (the "arbitrator"), rather than a judge or jury, renders a final and binding decision on a particular matter. Arbitration is a matter of contract, and a party cannot be required to submit to arbitration any dispute which he has not agreed to submit. See Tittle v. Enron Corp., 463 F.3d 410, 418-19 (5th Cir. 2006).

         Evaluating a motion to compel arbitration under the FAA involves a two-step analysis. Papalote CreekII, L.L.C v. Lower Colo. ...


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