United States District Court, N.D. Alabama, Southern Division
MEMORANDUM OPINION
R.
DAVID PROCTOR, UNITED STATES DISTRICT JUDGE.
This
case is before the court on Defendants' Motion to Compel
Arbitration and to Strike Plaintiff's Class Action
Claims. (Doc. # 3). The Motion has been fully briefed (Docs.
# 6-7, 10, 13) and is ripe for review. After careful review,
and for the reasons explained below, Defendants' Motion
is due to be denied.
I.
Background
Plaintiff
Keven Robinson was employed by Virginia College. But before
that, he was a student at its Birmingham, Alabama campus from
2000-2011. (Doc. # 1-1 at ¶¶ 14-15). He obtained an
Associate's Degree in Therapeutic Massage, a
Bachelor's Degree in Health Services Management, and a
Masters of Business Administration. (Id. at ¶
15).
In
2015, Plaintiff accepted employment with Defendants. (Doc. #
6 at 2). Defendants assert that, as part of this employment
relationship, Robinson signed an arbitration agreement
consenting to arbitration of all potential claims
between the parties. (Doc. # 3 at 2). The arbitration
agreement contains the following relevant language:
1. The Mutual Agreement to Arbitrate. …[T]he
parties agree that any dispute, controversy or claim[]
arising out of or related to this Agreement, the employment
relationship between the parties, or the termination of the
employment relationship shall be resolved by binding
arbitration administered by the American Arbitration
Association in accordance with its Employment Arbitration
Rules. The agreement to arbitrate includes any claims that
the Company [Defendants] may have against the Employee
[Plaintiff] or that Employee may have against the Company or
against any of its officers, directors, employees, agents, or
parent, subsidiary, or affiliated entities, except as set for
below, including any claims that could have been brought
before any court….BY ENTERING THIS AGREEMENT,
THE PARTIES HEREBY WAIVE THEIR RIGHT TO HAVE ANY DISPUTE,
CLAIM, OR CONTROVERSY DECIDED BY A JUDGE OR JURY IN A
COURT.
4. Class/Collective Action Waiver. BY
ENTERING THIS AGREEMENT, THE PARTIES AGREE THAT EACH MAY
BRING CLAIMS AGAINST THE OTHER ONLY IN THEIR INDIVIDUAL
CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY
PURPORTED CLASS AND/OR COLLECTIVE PROCEEDING.
(Doc. # 3-1 at 2, 3) (emphasis in original). Additionally,
the agreement mandates that arbitration “will be
administered pursuant to the American Arbitration Association
Employment Arbitration Rules, ” and any decision
“rendered by the arbitrator shall be written [in]
accordance with the American Arbitration Association
Employment Arbitration Rules.” (Id. at 3). The
agreement also advises the parties that they may obtain a
copy of the Rules from their local HR representative.
(Id.). Finally, the entire agreement (including the
signature block) refers to Plaintiff as the
“Employee.” (Id. at 4).
The
backdrop of Plaintiff's class claims relates to the
suspension of Defendants' academic accreditation on
December 4, 2018. (Doc. # 1 at ¶ 2). The following
morning, Defendants closed all campuses nationwide.
(Id.). That afternoon, Plaintiff filed his Class
Action Complaint, in which he alleges the following claims:
negligent and wanton operation, management, and marketing of
Defendants' degree programs (Counts One and Two); a
violation of the Alabama Deceptive Trade Practices Act (Count
Three); breach of implied warranty (Count Four); breach of
contract (Count Five); unjust enrichment (Count Six); and
injunctive relief requiring Defendants to provide either
education at accredited institutions free of charge or
alternative tuition at accredited institutions free of charge
(Count Seven). (Id. at 7-14).
Relying
on the arbitration agreement quoted above, Defendants filed
its Motion to Compel Arbitration and to Strike
Plaintiff's Class Action Claims on January 11, 2019.
(Doc. # 3). Plaintiff argues that the arbitration agreement,
which governs disputes relating to or arising out of his
employment relationship with Defendants, does not cover the
subject class action claims dealing with his previous
enrollment as a student. (See generally Doc. # 6).
II.
Analysis
The
Federal Arbitration Act (FAA) provides that a written
agreement to arbitrate “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. “This provision ‘reflect[s] both a
liberal federal policy favoring arbitration, and the
fundamental principle that arbitration is a matter of
contract.'” Inetianbor v. CashCall, Inc.,
768 F.3d 1346, 1349 (11th Cir. 2014) (quoting AT&T
Mobility LLC v. Concepcion, 131 S.Ct. 1740, 1745
(2011)). In fact, the policy favoring arbitration is so
strong that any doubts surrounding the arbitrability of the
dispute must be resolved in favor of arbitration. See
Moses H. Cone Mem'l Hosp. v. Mercury Costr. Corp.,
460 U.S. 1, 25 (1983). That being said, the FAA “does
not require parties to arbitrate when they have not agreed to
do so.” Wheat, First Sec., Inc. v. Green, 993
F.2d 814, 817 (11th Cir. 1993) (quoting Volt Info.
Sciences, Inc. v. Bd. of Trustees of Stanford Univ., 489
U.S. 468, 478 (1989)).
Unless
the parties “clearly and unmistakably provide
otherwise, ” whether they have entered into an
agreement to arbitrate is a question reserved for the
district court, not the arbitrator. AT&T
Technologies, Inc. v. Comm. Workers of Am., 475 U.S.
643, 649 (1986). Often referred to as “gateway matters,
” it is usually for the district court to consider
“(1) whether there is a valid agreement to arbitrate,
and (2) whether the dispute in question falls within the
scope of that agreement.” King v. Cintas
Corp., 920 F.Supp.2d 1263, 1267 (N.D. Ala. 2013);
see also Green Tree Fin. Corp. v. Bazzle,
539 U.S. 444, 452 (2003).[1] State-law principles regarding ordinary
contract formation and interpretation guide the court's
determination. Id.
Plaintiff
focuses his opposition on the second gateway question. He
argues that even if he agreed to arbitration as an employee,
the agreement does not apply to the dispute in question,
which is based on his enrollment as a student, not his
employment. For the reasons explained below, the court agrees
and finds that the dispute is not within the scope of the
arbitration agreement and the class action waiver is
inapplicable. Accordingly, Defendants' Motion is due to
be denied.
A.
Plaintiff's Class Action Claims Do Not Fall Within the
Scope of the Arbitration Agreement
Plaintiff
argues that his claims arising out of his enrollment as a
student at Defendants' institution are beyond the scope
of the arbitration agreement because the agreement relates
only to Plaintiff's employment with Defendants.
To support this assertion, Plaintiff presents an argument
based on the plain text of the agreement. For example, he
notes that in the introductory paragraph and in the signature
block, he is referred to as the “Employee.”
(Docs. # 6 at 3; 3-1 at 1, 4). He also cites the following
employment-centric language in the arbitration agreement:
“The Mutual Agreement to Arbitrate. Except for
the claims set forth in the paragraph below, the parties
agree that any dispute, controversy or claim[] arising out of
or related to this Agreement, the employment relationship
betweenthe parties, or the termination of the
employment relationship shall be resolved by binding
arbitration administered by the ...