United States District Court, E.D. Michigan, Southern Division
OPINION AND ORDER DENYING DEFENDANTS' MOTION TO
DISMISS OR TO COMPEL ARBITRATION
BERNARD A. FRIEDMAN SENIOR UNITED STATES DISTRICT JUDGE
This
matter is presently before the Court on defendants'
motion to dismiss or to compel arbitration [docket entry 10].
Plaintiff has responded and defendants have replied. Pursuant
to E.D. Mich. LR 7.1(f)(2), the Court shall decide this
motion without a hearing.
This is
an employment discrimination case. Plaintiff alleges that her
former manager, defendant Eugene Hughey, subjected her to a
hostile work environment by, among other things, making
unwelcome sexual comments and advances. She claims that
Hughey's conduct resulted in her being constructively
discharged from her employment with defendant CARite
Corporate LLC (“CARite”). In Counts 1 and 2,
plaintiff is suing CARite for sex discrimination and hostile
work environment under Title VII of the 1964 Civil Rights
Act, and in Counts 3 and 4 she is suing CARite and Hughey for
sex discrimination and hostile work environment under the
Elliott-Larsen Civil Rights Act. In Count 5, plaintiff claims
that defendant Angela Barnes, a former co-worker, defamed her
by falsely telling Hughey and others that she had had plastic
surgery and that she was sexually promiscuous.
Defendants
seek dismissal of the complaint on the grounds that
plaintiff, while she was employed, signed an arbitration
agreement, a copy of which is attached to defendants'
motion as Exhibit A. Defendants point to language in the
agreement stating that “the undersigned employee agrees
that any dispute or claim arising out of or relating to my
employment with CARite, shall be settled by final and binding
arbitration . . .” Defs.' Ex. A at 3. Defendants
ask that the Court “dismiss the action with prejudice
and allow Plaintiff to pursue her claims through arbitration,
if she so desires.” Defs.' Br. at 5. Plaintiff
opposes the motion on the grounds that the agreement lacks
mutuality of obligation and that she did not sign it
knowingly and voluntarily.
Defendants'
motion seeks dismissal under Fed.R.Civ.P. 12(c). However, the
motion is supported by the arbitration agreement, and both
the response and reply briefs are supported by additional
extra-pleading documents, including plaintiff's affidavit
and employment application. In these circumstances,
Fed.R.Civ.P. 12(d) states:
If, on a motion under Rule 12(b)(6) or 12(c), matters outside
the pleadings are presented to and not excluded by the court,
the motion must be treated as one for summary judgment under
Rule 56. All parties must be given a reasonable opportunity
to present all the material that is pertinent to the motion.
As the
Court shall not exclude the extra-pleading documents,
defendants' motion “must be treated as one for
summary judgment.” Id. And as neither party
has requested any further opportunity to present pertinent
material, the Court shall decide defendants' motion at
this time under Rule 56. The Court grants such a motion
“if the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a). A
dispute is “genuine” “if the evidence is
such that a reasonable jury could return a verdict for the
non-moving party.” Ford v. Gen. Motors Corp.,
305 F.3d 545, 551 (6th Cir. 2002) (quoting Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505,
91 L.Ed.2d 202 (1986)). The moving party bears the initial
burden of establishing that there are no genuine issues of
material facts, which it may accomplish “by
demonstrating that the nonmoving party lacks evidence to
support an essential element of its case.” Id.
(citing Celotex Corp. v. Catrett, 477 U.S. 317,
322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). In response,
the nonmoving party must present “significant probative
evidence” that will reveal that there is more than
“some metaphysical doubt as to the material
facts.” Moore v. Philip Morris Cos., Inc., 8
F.3d 335, 340 (6th Cir. 1993). The mere existence of a
scintilla of evidence in support of the nonmovant's
position will not suffice to avoid summary judgment.
Anderson, 477 U.S. at 252, 106 S.Ct. 2505.
Peeples v. City of Detroit, 891 F.3d 622, 630 (6th
Cir. 2018).
In the
present case, defendants are not entitled to summary judgment
for at least three reasons. First, the arbitration agreement
states in ¶ 3 that various claims are “Not Covered
by this Agreement, ” including “claims made with
any governmental agency such as the Equal Employment
Opportunity Commission.” Plaintiff's Title VII
claims (Counts 1 and 2) are claims she “made with . . .
the Equal Employment Opportunity Commission” and are
therefore plainly excluded from arbitration.
Second,
plaintiff has shown, and defendants do not deny, that
defendant Hughey coerced her into signing the arbitration
agreement. Plaintiff avers that on July 14, 2017, in the
middle of a busy workday, Hughey presented her with the
agreement and “said that if I did not sign the document
by the end of that day, I would no longer be allowed to work
there.” Pl.'s Aff. ¶ 11. Defendants offer no
evidence to the contrary. Nor do defendants challenge
plaintiff's averments that at the time she was a single
mother with a disabled fourteen-year old child and that she
“had to keep [her] only job.” Id.
¶¶ 3-4, 14. These uncontested facts invalidate the
agreement because they demonstrate plaintiff was, by
Hughey's threat, “incapacitated to consent to the
agreement.” Silverman v. Spitzer, No. 317682,
2014 WL 7157419, at *5 (Mich. Ct. App. Dec. 16, 2014)
(quoting Meier v. Schulte, 41 N.W.2d 351 (1950)). An
arbitration is enforceable “save upon such grounds as
exist at law or in equity for the revocation of any contract,
” 9 U.S.C. § 2, and coercion is such a grounds.
See Elete Enters., L.L.C. v. Gen. Steel Corp., No.
278946, 2008 WL 4649113, at *4 (Mich. Ct. App. Oct. 21,
2008).
Third,
defendants have not shown, or even argued, that the
arbitration agreement may be enforced by defendant Barnes,
one of plaintiff's co-workers, regarding plaintiff's
defamation claim. While ¶ 2 of the agreement indicates
that the agreement “covers all claims arising in the
course of an employee's employment, ” plaintiff
alleges that Barnes defamed her by “publish[ing] the
remarks to Defendant Hughey and other third parties.”
Compl. ¶ 93. Even if the agreement were not void due to
Hughey's coercion, it is not apparent that Barnes'
alleged publication of defamatory remarks to third parties is
a claim the agreement covers.
Because
the Court is satisfied that defendants' motion may be
denied on these grounds, the Court finds it unnecessary to
address the parties' remaining arguments. Accordingly, IT
IS ORDERED that ...