United States District Court, N.D. Ohio, Eastern Division
JARROD PYLE, on behalf of himself and all others similarly situated, PLAINTIFF,
VXI GLOBAL SOLUTIONS, INC., et al., DEFENDANTS.
MEMORANDUM OPINION AND ORDER
HONORABLE SARA LIOI UNITED STATES DISTRICT JUDGE.
the Court is the motion of defendants, VXI Global Solutions,
Inc. and VXI Global Solutions, LLC, to compel arbitration and
dismiss the complaint. (Doc. No. 16 [“Mot.”].)
Defendants argue that, in the course of his employment,
plaintiff, Jarrod Pyle, signed an arbitration agreement, in
which he agreed to submit any employment-related claim he
might have against defendants to arbitration, and he is,
therefore, precluded from bringing this collective action.
Plaintiff opposes the motion, arguing that the Sixth
Circuit's recent decision in N.L.R.B. v. Alt.
Entm't, Inc., 858 F.3d 393 (6th Cir. 2017) renders
the parties' arbitration agreement unenforceable. (Doc.
No. 18 [“Opp'n”].) Defendant has filed a
reply (Doc. No. 20 [“Reply”]), and the Court
permitted the parties to file supplemental briefs
specifically addressing the applicability of the decision in
Alternative Entertainment. (Doc. No. 26
(Plaintiff's Surreply); Doc. No. 28 (Defendants'
Response to Plaintiff's Surreply).) For the reasons set
forth below, defendants' motion to compel arbitration is
February 2, 2017, plaintiff filed this collective action for
relief under the Fair Labor Standards Act (“the
FLSA”), 29 U.S.C. §§ 201 et seq.
(Doc. No. 1 (Complaint [“Compl.”]).) In his
complaint, plaintiff avers that between September 2013 and
approximately October 2014 he was employed by defendants at a
call center located in Canton, Ohio. (Id. ¶
18.) During this time, and before he was eventually promoted
to a salaried position, he held the position of Phone
Operator. (Id. ¶ 18.) He maintains that he and
other Phone Operators were required to work more than forty
(40) hours in any given week without receiving overtime
compensation as required by federal law. (Id.
¶¶ 23-24.) By this action, plaintiff seeks to
recover unpaid overtime allegedly owed to him, and he also
seeks to represent a collective of all Phone Operators
employed by defendants during any week within three years of
the filing of the complaint. (Id. ¶ 25, Prayer
for Relief.) To date, approximately 23 plaintiffs have filed
opt-in forms giving their consent to join in the collective
their motion to compel, defendants argue that the Court
should enforce an arbitration agreement signed by plaintiff.
According to defendants, plaintiff and defendants mutually
agreed to submit any claim related to plaintiff's
employment with defendants to binding arbitration.
Specifically, the agreement, which is appended to the
complaint, requires arbitration of all disputes, including
any “claims for wages, bonuses, commissions or any
other form of compensation[.]” (Compl., Ex. A
(Arbitration Agreement [“Arb. Agr.”]), § 1.)
It also mandates binding arbitration for “all claims
for violation of any federal, state or other governmental
law, statute, [or] ordinance.” (Id.) It is
defendants' position that, given this broad contractual
language, plaintiff's single FLSA cause of action clearly
falls within the purview of the arbitration agreement.
Defendants further stress that this controlling arbitration
agreement is silent as to the availability of collective
arbitration, so this Court cannot find that the parties'
agreed to classwide arbitration. (Mot. at 67.) Accordingly,
defendants insist that plaintiff is required to submit his
claim to arbitration and resolve it on an individual basis.
does not dispute that his FLSA claim is covered by the
arbitration agreement, nor does he disagree that the
arbitration agreement is silent as to class-wide arbitration.
In fact, he admits both facts in his complaint. (Compl.
¶ 9.) Noting that Sixth Circuit law now provides that
collective/class waivers in employment arbitration agreements
violate the National Labor Relations Act
(“NLRA”), he maintains that requiring him to
proceed to arbitration on an individual basis would be
illegal. (Opp'n at 100.) While he opposes defendants'
motion to compel, he indicates that he would be willing to
participate in collective arbitration proceedings, if
defendants are amenable. (Id. at 101.) Defendants
decline plaintiff's offer and maintain that classwide
arbitration is not provided for in the agreement.
Law and Analysis
Federal Law Favors Arbitration
Federal Arbitration Act (“FAA”), 9 U.S.C. §
1, et seq., manifests “a liberal federal
policy favoring arbitration agreements[.]” Moses H.
Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S.
1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983); see
Seawright v. Am. Gen. Fin. Servs., Inc., 507
F.3d 967, 972 (6th Cir. 2007) (Section 2 of the FAA
“‘embodies the national policy favoring
arbitration and places arbitration agreements on equal
footing with all other contracts.'”) (quoting
Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S.
440, 443, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006)). “To
enforce this dictate, [the FAA] provides for a stay of
proceedings when an issue is referable to arbitration and for
orders compelling arbitration when one party has failed or
refused to comply with an arbitration agreement.”
Javitch v. First Union Sec., Inc., 315 F.3d 619, 624
(6th Cir. 2003). All “doubts regarding arbitrability
should be resolved in favor of arbitration.” Fazio
v. Lehman Bros., Inc., 340 F.3d 386, 392 (citing
Moses H. Cone Mem'l Hosp., 460 U.S. at 24-25.)
Further, “the FAA preempts state laws and policies
regarding arbitration.” Id. at 393 (citing
Southland Corp. v. Keating, 465 U.S. 1, 10-11, 104
S.Ct. 852, 79 L.Ed.2d 1 (1984)); see also Great Earth
Cos., Inc. v. Simons, 288 F.3d 878, 889 (6th Cir. 2002)
(“the FAA preempts state laws applicable only
to arbitration provisions”) (quotation marks and
citation omitted) (emphasis in original). Balanced against
the clear policy favoring arbitration is the well settled
principle that “arbitration is a matter of contract and
a party cannot be required to submit to arbitration any
dispute which he has not agreed so to submit.” A T
& T Techs., Inc. v. Commc'ns Workers of Am., 475
U.S. 643, 648, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986)
(quotation marks and citations omitted).
Sixth Circuit applies a four-pronged test to determine
whether an unwilling party can be compelled to arbitrate: (1)
the Court must determine whether the parties agreed to
arbitrate; (2) the Court must determine the scope of that
agreement; (3) if federal statutory claims are asserted, the
Court must consider whether Congress intended those claims to
be non-arbitrable; and (4) if the Court concludes that some,
but not all, of the claims in the action are subject to
arbitration, it must determine whether to stay the remainder
of the proceedings pending arbitration. Stout v. J.D.
Byrider, 228 F.3d 709, 714 (6th Cir. 2000) (citation
omitted); see Javitch, 315 F.3d at 624 (court must
engage in a “limited review” to determine whether
the dispute is arbitrable) (citation omitted).
The Sixth Circuit's Test for Compelling Arbitration is
is no question that the record facts satisfy the four-prong
test. First, as set forth above, it is undisputed that the
parties entered into an agreement to bring all
employment-related claims, including all wage and hour claims
and claims to enforce federal laws, to binding arbitration.
Second, plaintiff concedes that his claim, which seeks to
recover additional compensation for allegedly unpaid wages,
falls within the scope of the arbitration agreement, which
provides for arbitration of all claims involving
“wages, bonuses, commissions or any other form of
compensation.” See Rupert v. Macy's, Inc.,
No. 1:09CV2763, 2010 WL 2232305, at *5 (N.D. Ohio June 2,
2010) (“Given this clear language, there can be no
doubt that all of Plaintiff's federal and state law
‘employment-related claims' are covered by the
arbitration agreement.”) Third, it is well settled that
FLSA claims, such as the one presented in plaintiff's
complaint, may be subject to arbitration. Floss v.
Ryan's Family Steak Houses, Inc., 211 F.3d 306, 313
(6th Cir. 2000); Smith v. BT Conferencing, Inc., No.
3:13-cv-160, 2013 WL 5937313, at *9 (S.D. Ohio Nov. 5, 2013)
(“many courts have found that FLSA rights may be
effectively vindicated in an arbitral, rather than legal,
setting”); Aracri v. Dilliard's Inc., No.
1:10CV253, 2011 WL 1388613, at *4 (S.D. Ohio Mar. 29, 2011)
(“statutory claims may be the subject of an arbitration
agreement, including claims under the FLSA”)
(collecting cases). As to the fourth prong, “[i]n cases
where all claims are referred to arbitration . . . the
litigation may be dismissed rather than merely stayed.”
Rupert, 2010 WL 2232305, at *4 (citations omitted).
Here, the one and only claim in plaintiff's complaint is
undeniably subject to arbitration, making dismissal the
appropriate disposition of the present litigation. See,
e.g., Wallace v. Red Bull Distrib. Co., 958 F.Supp.2d
811, 827 (N.D. Ohio 2013) (dismissing federal litigation
where all claims were subject to arbitration). All four
prongs, therefore, are met, and plaintiff offers no argument
to the contrary.
exclusively on the recent decision in Alternative
Entertainment, plaintiff argues that the ruling
“brings an end to Defendants' request that the
Court order Mr. Pyle to proceed to individual-rather than
collective-arbitration. Such an order would be
illegal.” (Opp'n at 100.) But plaintiff fails to
recognize an important distinction between the facts
surrounding that decision and the manner in which
plaintiff's FLSA claim has presented itself.
The Sixth Circuit's Decision in Alternati ...