Roberson v. SFM LLC

1 WO [5] 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA [8] Joseph R. Roberson, ) No. CV-19-01240-PHX-SPL ) [9] ) 10 Plaintiff, ) ORDER vs. ) ) [11] ) SMF, LLC, et al., ) [12] ) 13 Defendants. ) ) 14 ) 15 Before the Court is Defendants’ Motion to Compel Arbitration and Dismiss Without 16 Prejudice. (Doc. 11). For the following reasons, the motion will be granted. 17 I. BACKGROUND 18 Plaintiff Joseph Roberson worked for Defendant SMF, LLC as a supermarket clerk. 19 (Doc. 11 at 2). Plaintiff called out from work on thirteen separate occasions within two 20 months due to flareups of his asthma. (Doc. 1 at 5, 7, 8-9). Plaintiff alleges that, “[d]espite 21 being on notice of Plaintiff’s need for FMLA leave, Defendants did not provide Plaintiff 22 with notice of his rights and responsibilities under the FMLA.” (Doc. 1 at 7). Instead, 23 Plaintiff alleges that “Defendants removed Plaintiff from the store schedule in an attempt 24 to force him to quit his job and seek other employment because Plaintiff was exercising his 25 rights under the FMLA and seeking a reasonable accommodation for his disability.” (Doc. 26 1 at 10). On June 22, 2020, Plaintiff filed a Complaint in this Court alleging violations of 27 the FMLA. (Doc. 1). 28 On October 8, 2020, Defendants filed a Motion to Compel Arbitration and Dismiss 1 Without Prejudice, at issue here. (Doc. 11). Defendants allege Plaintiff’s claims are subject 2 to mandatory arbitration under his employment agreement. (Doc. 11 at 2-3). 3 On November 2, 2020, Plaintiff filed his Response. (Doc. 13). Plaintiff argues he 4 “did not sign an arbitration agreement in favor of SFM.” (Doc. 13 at 1-2). However, 5 Plaintiff also alleged he “cannot specifically deny the signature SFM alleges it has as his 6 signature” because Defendants’ Motion did not have the employment agreement attached 7 as an exhibit. (Doc. 13 at 2). Plaintiff further argues that, even if he did sign an employment 8 agreement that mandated arbitration, the agreement is not binding “because Plaintiff was 9 unaware of the existence of an arbitration agreement during his employment with SFM.” 10 (Doc. 13 at 2). Plaintiff further provided an affidavit in which he alleged “[h]ad I been 11 asked to sign an arbitration agreement, I would have refused.” (Doc. 13 at 4). 12 On November 9, 2020, Defendants filed a Reply, which alleged that Defendants 13 provided Plaintiff a copy of the arbitration agreement by overnight mail but that he never 14 responded, and then sent Plaintiff a copy of the Motion to Compel with the agreement 15 attached as an exhibit to the address Plaintiff has on file, which they later learned does not 16 match the location where Plaintiff’s declaration was executed. (Doc. 14 at 1, n.1). The 17 Reply included as exhibits (i) copies of the multiple arbitration agreements signed by 18 Plaintiff and (ii) a declaration of Defendants’ HR Manager attesting to the validity of the 19 arbitration agreement and Plaintiff’s signature. (Docs. 14, 14-1, 14-2). 20 II. LEGAL STANDARD 21 The Federal Arbitration Act (“FAA”) “leaves no place for the exercise of discretion 22 by a district court, but instead mandates that district courts shall direct the parties to proceed 23 to arbitration on issues as to which an arbitration agreement has been signed.” Dean Witter 24 Reynolds Inc. v. Byrd, 470 U.S. 213, 218 (1985) (citing 9 U.S.C. §§ 3 , 4). “The court's role 25 under the [FAA] is therefore limited to determining (1) whether a valid agreement to 26 arbitrate exists and, if it does, (2) whether the agreement encompasses the dispute at issue.” 27 Chiron Corp. v. Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000) (citing 9 28 U.S.C. § 4 ) (other citations omitted). If a district court decides that an arbitration agreement 1 is valid and enforceable, “then it should stay or dismiss the action pending arbitration 2 proceedings to allow the arbitrator to decide the remaining claims, including those relating 3 to the contract as a whole.” Nagrampa v. MailCoups, Inc., 469 F.3d 1257 , 1276–77 (9th 4 Cir. 2006). 5 “Arbitration agreements are presumptively enforceable under the FAA ‘save upon 6 such grounds as exist at law or in equity for the revocation of any contract.’” Taleb v. 7 AutoNation USA Corp., No. CV06–02013–PHX–NVW, 2006 WL 3716922 , at *2 (D. Ariz. 8 Nov. 13, 2006) (quoting 9 U.S.C. § 2 ). “In determining the validity of an agreement to 9 arbitrate, federal courts ‘should apply ordinary state-law principles that govern the 10 formation of contracts.’” Circuit City Stores, Inc. v. Adams, 279 F.3d 889, 892 (9th Cir. 11 2002) (citing First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 944 (1995)). Thus, in 12 determining the validity and enforceability of the arbitration agreement here, Arizona’s law 13 of contracts controls. Taleb, 2006 WL 3716922 , at *2. While “generally applicable contract 14 defenses, such as fraud, duress, or unconscionability, may be applied to invalidate 15 arbitration agreements,” courts may not “invalidate arbitration agreements under state laws 16 applicable only to arbitration provisions.” Doctor's Assocs., Inc. v. Casarotto, 517 U.S. 17 681, 687 (1996) (citations omitted). 18 III. ANALYSIS 19 Plaintiff does not identify any specific contract defenses such as fraud, 20 unconscionability, or duress. Instead he argues that he was “unaware of the existence of an 21 arbitration agreement during his employment with [Defendants]” and that “[h]ad [he] been 22 asked to sign an arbitration agreement, [he] would have refused.” (Doc. 13 at 2, 4). 23 The mere fact that one does not read a contract which he has signed is not ipso facto 24 grounds to invalidate the writing. Mut. Ben. Health & Acc. Ass'n v. Ferrell, 42 Ariz. 477 , 25 487, 27 P.2d 519 (1933) (overruled on other grounds). In Ferrell, the Arizona Supreme 26 Court explained: 27 [W]hen a party has an equal opportunity to read and examine a contract with the other party, it is his duty to do so, and, if he [28] fails, he will not be permitted to avoid it on the ground that he [1] did not read it or supposed it was different in its terms from 2 what it really was. [3] Id. at 523 ; see also Bradley v. Industrial Commission, 51 Ariz. 291, 299 , 76 P.2d 745 , 748 4 (1938) (“When a person . . . has carelessly signed [a writing] without reading it, the mere 5 fact that he believed it to be something else than what it was, when such belief was not 6 brought about by the misconduct of the other party, furnishes no ground for the admission 7 of parol evidence that he did not mean to execute it, for courts are not under the duty of 8 relieving parties of the consequences of their own gross negligence.”). 9 Here, there is no allegation or evidence that the contents of the document were 10 misrepresented directly or indirectly to Plaintiff and consequently the elements of fraud or 11 unconscionability are absent. At worst, no one showed Plaintiff the full text of the 12 arbitration agreement or told him what was contained within. But absent some 13 misrepresentation or coercion by Defendants, this is not sufficient to absolve Plaintiff of 14 his negligence in not reading the contract. See, e.g., DMARC 2006-CD2 Indian Sch., LLC 15 v. Bush Realty At Steele Park, LLC, No. 1 CA-CV 14-0603, 2016 WL 7209656 , at *3 (Ariz. 16 Ct. App. Dec. 13, 2016) (finding that the plaintiff’s “failure to read or understand the 17 [contract] does not excuse him from liability” because “he does not claim he was defrauded 18 into signing the [contract] or misled about its content”). Where such evidence is absent, the 19 Court must look to the four corners of the contract to ascertain the intent of the contracting 20 parties. United California Bank v. Prudential Ins. Co. of America, 681 P.2d 390, 410 (Ariz. 21 Ct. App. 1983); Central Arizona Water Conservation District v. United States, 32 F. Supp. 22 2d 1117, 1127 (Ariz. 1998). The four corners of the contract here indicates a clear intent 23 for the parties to submit this dispute to arbitration. 24 The first arbitration agreement Plaintiff signed electronically is clearly labeled 25 “MUTUAL BINDING ARBITRATION AGREEMENT.” (Doc. 14-2 at 7) (emphasis 26 in original). Further, the agreement states clearly in underlined and bolded font: “The 27 Company and the Employee EXPRESSLY WAIVE their rights, if any, to have such 28 claims heard by a court.” (Doc. 14-2 at 7) (emphasis in original). Additionally, the 1 | agreement states that “any Dispute between the Employee ... and the Company .. . that 2| arise out of, relate in any manner, or have any relationship whatsoever to the employment 3 | or the termination of employment by Employee .. . shall be resolved by final and binding 4| arbitration.” (Doc. 14-2 at 7). Plaintiff then hand-signed a new arbitration agreement two years later. (Doc. 14-2 at 13-17). The second agreement is clearly labeled “MUTUAL 6| BINDING ARBITRATION AGREEMENT.” (Doc. 14-2 at 13) (emphasis in original). And again, the agreement covers “all complaints, charges, [and] claims . . . arising out of 8 | or related to [Plaintiff]’s employment with [Defendants] and/or termination thereof” and 9 | provides that “any claim .. . shall be submitted to final and binding arbitration.” (Doc. 1410| 2 at 13). The instant claims by Plaintiff, which allege failure to provide FMLA leave and 11 | unlawful termination, fall directly within the claims covered by the arbitration agreement 12| as they clearly deal with “the employment or the termination of employment” of Plaintiff. 13 | And in fact, the agreement provides that “[e]ither party may bring an action in court to compel arbitration under this Agreement.” (Doc. 14-2 at 16). Plaintiff is bound by what he signed. Accordingly, 16 IT IS ORDERED that Defendants’ Motion to Compel Arbitration and Dismiss 17 | Without Prejudice (Doc. 11) is granted. 18 IT IS FURTHER ORDERED directing the Clerk of the Court to dismiss this 19 | action without prejudice and close the case. 20 Dated this 10th day of November, 2020. [21] 73 United States District kudge