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Price v. Santander Consumer USA Inc.

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

September 12, 2019

JASON PRICE and CLINTON SHAW, Individually and on Behalf of Those Similarly Situated, Plaintiffs,
v.
SANTANDER CONSUMER USA INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          JANE J. BOYLE UNITED STATES DISTRICT JUDGE

         Before the Court is Defendant Santander Consumer USA Inc.'s Motion to Compel Individual Arbitration (Doc. 13). For the reasons that follow, the Court GRANTS Defendant's Motion to Compel Individual Arbitration.

         I.

         BACKGROUND

         This is a collective action under the Fair Labor Standards Act (FLSA). Plaintiffs Jason Price and Clinton Shaw allege that Defendant Santander Consumer USA Inc. violated the FLSA by failing to pay Plaintiffs, and those similarly situated, for overtime work. Doc. 1, Pls.' Compl., ¶¶ 33-35, 40. Defendant employs individuals as Resolution Specialists and treats them as exempt salaried employees. Doc. 16, Def.'s Answer, ¶¶ 14, 23. Plaintiffs allege that, as Resolution Specialists, they were paid by the hour, and they regularly worked more than forty hours per week. Doc. 1, Pls.' Compl., ¶¶ 23-24. Despite this overtime work, however, Plaintiffs claim that Defendant failed to pay Plaintiffs one and one-half times their regular rate in violation of 29 U.S.C. § 207. Id. at ¶ 33. Accordingly, Plaintiffs bring this collective action on behalf of themselves and all other similarly situated employees of Defendant. Id. at ¶ 40.

         Thereafter, Defendant filed a Motion to Compel Individual Arbitration (Doc. 13). Plaintiffs filed a Response (Doc. 18), and Defendant filed a Reply (Doc. 21), as well as a Supplemental Appendix to its Motion (Doc. 23). Subsequently, Plaintiffs obtained leave of Court to file a sur-reply to Defendant's Motion (Doc. 27). The Motion is now ripe for the Court's review.

         II.

         LEGAL STANDARD

         In enacting the Federal Arbitration Act (FAA), “Congress . . . expressed a strong policy favoring arbitration before litigation . . . .” J.S. & H. Constr. Co. v. Richmond Cty. Hosp. Auth., 473 F.2d 212, 214-15 (5th Cir. 1973). Under the FAA, “[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. The Fifth Circuit follows a two-step procedure to decide whether to compel arbitration: (1) “determine whether the parties agreed to arbitrate the dispute in question, ” and (2) determine whether any external legal constraints preclude arbitration of the dispute. Webb v. Investacorp, Inc., 89 F.3d 252, 257-58 (5th Cir. 1996) (per curiam). A party seeking to compel arbitration must only prove the existence of an agreement by a preponderance of the evidence. Grant v. Houser, 469 Fed.Appx. 310, 315 (5th Cir. 2012) (per curiam).

         Moreover, to determine if evidence in support of a motion to compel arbitration is admissible, courts apply a similar standard as that applied to a motion for summary judgment. Galitski v. Samsung Telecomm. Am., LLC, 2013 WL 6330645, at *1 n.1 (N.D. Tex. Dec. 5, 2013). That is, the evidence must comply with the Federal Rules of Evidence and be based on personal knowledge. Id.

         III. ANALYSIS

         Defendant moves the Court to compel individual arbitration and dismiss the lawsuit with prejudice. Doc. 21, Def.'s Reply to Pls.' Resp. to Def.'s Mot. Compel Indiv. Arbitration, 10. Since the parties dispute both the existence of an arbitration agreement and whether Plaintiffs may proceed collectively, the Court will address: (1) whether to compel arbitration of the claims; (2) whether Plaintiffs must arbitrate individually; and (3) whether to dismiss or stay the case.

         A. Whether to Compel Arbitration of the Claims

         First, the Court must determine whether the parties agreed to arbitrate the dispute at issue by considering whether the parties have a valid agreement to arbitrate and whether the dispute falls within the scope of the agreement. Webb, 89 F.3d at 258. If the answer to both of those questions is yes, then the Court must consider whether any external legal constraints foreclose arbitration. Id. Neither party contends that the dispute falls outside the scope of the alleged arbitration agreement, nor ...


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