Robinson v. Virginia College LLC

          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 ...