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Clark v. Nordstrom, Inc.

United States District Court, N.D. Texas, Dallas Division

July 30, 2019

HALEY CLARK, Plaintiff,
NORDSTROM, INC., Defendant.



         In this removed action alleging violations of Texas law in connection with the termination of plaintiff's employment, the court must decide whether the claims are subject to mandatory, binding arbitration. Concluding that they are, the court grants defendant's motion to compel arbitration, stays the case pending the completion of arbitration, and directs the clerk of court to close the case for statistical purposes while the stay is in effect.


         In November 2013 Trunk Club, a Chicago-based clothing retailer, hired plaintiff Haley Clark (“Clark”) to work in its Dallas office. The following year, Trunk Club was acquired by defendant Nordstrom, Inc. (“Nordstrom”), and its employees, including Clark, were required to sign the Trunk Club Dispute Resolution Agreement (“Agreement”).

         The Agreement provides, in pertinent part:

[t]his Agreement applies to any disputes arising out of or related to your application for employment with Trunk Club or one of its affiliates, subsidiaries or parent companies, including Nordstrom Inc. (hereinafter “Trunk Club”), or your employment with Trunk Club or the termination of your employment from Trunk Club.

         D. Mot. Ex. A-1 at 1.[1] It further provides that it

applies without limitation to disputes regarding the employment relationship, trade secrets, unfair competition, compensation, breaks and rest periods, termination, discrimination, retaliation . . . or harassment and claims arising under the Uniform Trade Secrets Act, Civil Rights Act of 1964, Americans With Disabilities Act, Age Discrimination in Employment Act, Family Medical Leave Act, Fair Labor Standards Act, Genetic Information Non-Discrimination Act, and other state and local statutes, addressing the same or similar subject matters, and all other state statutory and common law claims. Such disputes also include without limitation disputes arising out of or relating to the interpretation or application of this Agreement. However, this Agreement does not apply to disputes regarding the enforceability, revocability or validity of the Agreement or any portion of the Agreement.

Id. at 1-2.

         From the time she was hired, until October 23, 2017, Clark worked for Trunk Club without incident. On October 23, 2017, however, two individuals from Nordstrom's loss prevention department met with Clark at Trunk Club's offices and accused her of stealing Nordstrom property and improperly using her employee discount. Although Clark explained that she was unaware that she was doing anything wrong with respect to her employee discount and denied the accusation of theft, Clark was informed that she was being “reassigned” to her house for the remainder of the day to await a decision from Nordstrom regarding her employment status. Clark was later instructed to appear at Nordstrom's offices that afternoon.

         During the meeting at Nordstrom's offices, Nordstrom terminated Clark's employment and required that she sign the following five documents: (1) Investigations Civil Notice, (2) Calculation of Loss, (3) Adult Criminal Trespass Warning, (4) Nordstrom Written Statement, and (5) Promissory Note - Employee Caused Loss (“Promissory Note”). Although Nordstrom eventually decided not to pursue the $180.00 reflected on the Calculation of Loss form and admitted that the Adult Criminal Trespass Warning was issued in error, [2] it nonetheless sent Clark three different letters (dated November 21, 2017, December 7, 2017, and January 3, 2017) demanding from Clark the amount reflected in the Promissory Note.

         On July 16, 2018 Clark sued Nordstrom in state court alleging claims for violation of the Texas Debt Collection Practices Act, Tex. Fin. Code Ann. §§ 392.001-.404 (West 2016 & Supp. 2018); violation of the Texas Deceptive Trade Practices-Consumer Protection Act (“DTPA”), Tex. Bus & Com. Code Ann. §§ 17.41-17.63 (West 2011 & Supp. 2018); and false imprisonment. She also seeks attorney's fees and a declaration that the Promissory Note is unenforceable as a matter of law and that the purported debt is canceled. Nordstrom removed the suit to this court and now moves to compel arbitration of Clark's claims pursuant to the Agreement. Clark opposes the motion.


         Section 2 of the Federal Arbitration Act (“FAA”) provides that written agreements to arbitrate controversies arising out of an existing contract “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. The FAA “leaves no place for the exercise of discretion by a district court, but instead mandates that district courts shall direct the parties to proceed to arbitration on issues as to which an arbitration agreement has been signed.” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218 (1985) (citing 9 U.S.C. §§ 3-4). When considering a motion to compel arbitration, the court engages in a two-step process. First, the court determines “whether the parties agreed to arbitrate the dispute.” Webb v. Investacorp, Inc., 89 F.3d 252, 258 (5th Cir. 1996) (per curiam) (citation omitted). “This determination involves two considerations: (1) whether there is a valid agreement to arbitrate between the parties; and (2) whether the dispute in question falls within the scope of that arbitration agreement.” Id. (citations omitted). Second, the court decides “‘whether legal constraints external to the parties' agreement foreclosed the arbitration of those claims.'” Id. (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 628 (1985)). “If there is a valid agreement to arbitrate, and there are no legal constraints that foreclose arbitration, the court must order the parties to arbitrate their ...

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