673 F.Supp.3d 1180
D. Colo.2023Background
- Flowers Foods (and subsidiaries) sells baked goods via a Direct-Store-Delivery model through independent distributor franchisees; Brock, Inc. operated by Angelo Brock was one such distributor.
- Brock ordered bakery products from out-of-state Flowers bakeries; shipments arrived at his Colorado warehouse, which he signed for, loaded onto his trucks, and delivered to local customers.
- Brock signed a Distributor Agreement containing an Arbitration Agreement requiring that disputes be submitted “exclusively” to binding arbitration under the Federal Arbitration Act (FAA) and governed by Colorado law only to the extent not inconsistent with the FAA.
- Brock sued Flowers (collective/class) under the FLSA and Colorado law alleging misclassification and unpaid wages; Flowers moved to compel individual arbitration.
- The central legal question was whether Brock is a “transportation worker” exempt from the FAA under 9 U.S.C. § 1 (as interpreted in Southwest Airlines Co. v. Saxon), making the arbitration clause unenforceable.
- The court applied Saxon’s two-step framework, concluded Brock belongs to a class of workers who load/unload and deliver interstate goods, and held § 1’s exemption applies, so the FAA does not compel arbitration.
Issues
| Issue | Plaintiff's Argument (Brock) | Defendant's Argument (Flowers) | Held |
|---|---|---|---|
| Whether § 1 transportation-worker exemption applies | Brock: he is a distributor who loads/unloads and delivers goods that originate out-of-state, so his class is engaged in interstate commerce and § 1 applies | Flowers: § 1 should be assessed by employer’s industry; Flowers is not a transportation company and Brock is a local distributor, so § 1 does not apply | Held: § 1 applies — court defines class by the work performed and finds Brock’s class engaged in interstate commerce |
| How to define the “class of workers” for § 1 analysis | Brock: define by the actual work (Distributors who load/unload and deliver) | Flowers: define by the nature of employer’s business or broader non-transportation class | Held: follow Saxon — class defined by the work members typically perform (not the employer’s industry) |
| Whether “engaged in foreign or interstate commerce” requires crossing state lines personally | Brock: class plays a direct/necessary role in interstate flow by hauling goods on final legs even if drivers do not themselves cross state lines | Flowers: Brock is a local/intrastate distributor; once goods arrive locally, subsequent handling is not part of interstate commerce | Held: court rejects Flowers; Brock’s work is a constituent part of interstate movement and satisfies § 1’s interstate-commerce requirement |
| Whether Colorado’s Uniform Arbitration Act can supply arbitration despite FAA exemption | Brock: Arbitration Agreement specifies exclusive application of FAA and Colorado law only if consistent with FAA, so Colorado law cannot compel arbitration inconsistent with § 1 | Flowers: Colorado law lacks a transportation-worker exemption and should render agreement arbitrable under state law | Held: court enforces the contract’s text — FAA controls and Colorado law cannot be applied inconsistently to defeat § 1 exemption |
Key Cases Cited
- Southwest Airlines Co. v. Saxon, 142 S. Ct. 1783 (U.S. 2022) (establishes two-step § 1 framework: define worker class by work performed, then ask if class is engaged in interstate commerce)
- New Prime Inc. v. Oliveira, 139 S. Ct. 532 (U.S. 2019) (court must decide applicability of § 1 exemption before ordering arbitration)
- Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (U.S. 2001) (interprets § 1 narrowly as a residual exclusion for transportation workers)
- Shearson/American Express Inc. v. McMahon, 482 U.S. 220 (U.S. 1987) (burden on party opposing arbitration to show statutory waiver of judicial remedies)
- Rittmann v. Amazon.com, Inc., 971 F.3d 904 (9th Cir. 2020) (discusses FAA enforcement mechanisms and § 1 issues for delivery workers)
- Waithaka v. Amazon.com, Inc., 966 F.3d 10 (1st Cir. 2020) (holds workers who perform last-mile delivery can be transportation workers under § 1)
- Fraga v. Premium Retail Servs., Inc., 61 F.4th 228 (1st Cir. 2023) (applies Saxon to define worker class by duties and finds transportation-worker status)
- Wallace v. Grubhub Holdings, Inc., 970 F.3d 798 (7th Cir. 2020) (contrasting decision finding certain local-delivery drivers not within § 1)
- Lopez v. Cintas Corp., 47 F.4th 428 (5th Cir. 2022) (holds workers who emphasize sales/customer service and handle goods post-unloading were not engaged in interstate commerce)
- Bissonnette v. LePage Bakeries Park St., LLC, 59 F.4th 594 (2d Cir. 2023) (discusses industry-focus approach and was distinguished by the court here)