United States District Court, M.D. Alabama, Southern Division
MEMORANDUM OPINION AND ORDER
C. MARKS CHIEF UNITED STATES DISTRICT JUDGE
Delores Riley (“Riley”) filed this action against
defendant Tower Loan of Mississippi, LLC (“Tower
Loan”) alleging that she had been discriminated against
based on her sex in violation of Title VII of the Civil
Rights Act of 1964, as amended, 42 U.S.C. § 2000e,
et. seq.. She also brings a state law claim of
breach of contract. She seeks compensatory and punitive
damages, injunctive relief, and attorney fees. The court has
jurisdiction over the federal claim pursuant to the
jurisdictional grant in 42 U.S.C. § 2000e-5, and
supplemental jurisdiction of the state law claim pursuant to
28 U.S.C. § 1367.
action is now pending before the court on the parties'
joint motion to compel arbitration (doc. 13) filed on
November 21, 2019. The “parties agree that the claims
alleged in this suit fall within the scope of a valid
arbitration agreement that was entered in interstate
commerce, such that the FAA applies.” (Id. at
1, para. 4). The parties ask the Court to enter an order
staying this case or dismissing the action without prejudice.
(Id. at 2, para. 5). Upon consideration of the
motion, and for the reasons that follow, the court concludes
that the motion to compel arbitration should be granted, the
motion to dismiss should be granted and the motion to stay
should be denied.
purpose of the motion to compel arbitration, the following
facts are undisputed. On March 12, 2018, Riley became an
employee of Tower Loans in Dothan, Alabama. On that date, she
signed an Employment Agreement with Tower Loans that contains
an arbitration provision. (Doc. 13, Ex. 1, para. 5)
arbitration agreement provides as follows:
5. Except for the equitable relief authorized by paragraph
hereto, the parties shall submit all other disputes, legal or
otherwise, relating to or in any way concerning either the
employment relationship or this Agreement to binding
arbitration. The arbitrable issues include, but are not
limited to, the scope of arbitration; the interpretation and
construction of this Agreement; claims alleging breach of
contract; claims based on race, sex, disability, or religious
matters; disclosing to third-parties any information obtained
by Tower under this Agreement; wage and hour or other
compensation disputes; libel and/or slander; Fair Credit
Reporting Act violations; wrongful discharge; and providing
third-parties information about Employee's performance or
facts of Employee's discharge or quitting, or any other
matter relating to or concerning the Employee's
relationship to Tower. There will be no right or authority
for any dispute to be brought, heard or arbitrated as a class
or collective action.
(Id.) (footnote added).
Plaintiff filed this action on September 9, 2019, alleging
that she was discriminated against on the basis of her sex
when she was terminated for failing to agree to relocate from
Dothan, Alabama and asserting a claim of breach of contract.
to the Federal Arbitration Act (“FAA”),
“[a] written provision in any . . . contract evidencing
a transaction involving commerce to settle by arbitration a
controversy . . . arising out of such contract . . . 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 parties agree that a
valid agreement to arbitrate exists between the parties, and
they do not dispute that the arbitration provisions satisfy
the FAA's requirement of a contract “involving
commerce.” Id. Consequently, the court
concludes that the parties' joint motion to compel
arbitration pursuant to the FAA should be granted.
remains, however, the parties' motion to stay or dismiss
the case without prejudice. Although 9 U.S.C.§ 3
suggests the Court “stay the trial of the action until
such arbitration has been had in accordance with the terms of
the agreement, ” the circumstances of this case support
dismissal without prejudice.
Although 9 U.S.C. § 3 speaks in terms of requiring a
stay when an action is referred to arbitration, the weight of
authority from district courts within this Circuit (and other
circuit courts of appeals) supports a dismissal of an action
when, due to an order compelling arbitration, there are no
substantive claims left pending before the district court.
Halford v. Deer Valley Home Builders, Inc., No.
2:07cv180-ID(WO), 2007 WL 1229339 at *3 (M.D. Ala. Apr. 25,
2007); see also Clayton v. Woodmen of World Life Ins.
Soc., 981 F.Supp. 1447, 1451 (M.D. Ala. 1997); Dale
v. Comcast Corp., 453 F.Supp.2d 1367, 1378 (N.D.Ga.
2006)(citing Choice Hotels Int'l, Inc. v. BSRTropicana Resort, Inc., 252 F.3d 707, 709-10 (4th
Cir. 2001)); Gilchrist v. Citifinancial Servs.,
Inc., No. 6:06cv1727-ORL-31KRS, 2007 WL 177821, *4 (M.D.
Fla. Jan. 19, 2007). Furthermore, although the Eleventh
Circuit has not directly addressed the propriety of dismissal
in lieu of a stay under 9 U.S.C. § 3, it has
“frequently affirmed where the district court compelled
arbitration and dismissed the underlying case.”