Price v. NCR Corp.
908 F. Supp. 2d 935
N.D. Ill.2012Background
- Plaintiff sues NCR for alleged FLSA, IMWL, and IWPCA violations related to wage and hour records and overtime compensation.
- Plaintiff and putative class were employed as non-exempt customer engineers/technicians with similar duties and pay structures.
- Defendant and Plaintiff entered a December 2007 Mutual Agreement to Arbitrate All Employment Related Claims, requiring binding arbitration under AAA rules.
- Agreement covers all disputes arising out of or relating to employment, with exceptions for workers' compensation and ERISA, and allows broad interpretation to include many disputes.
- Plaintiff files suit (May 4, 2012); Defendant moves (June 13, 2012) to compel arbitration and stay litigation, seeking to exclude class claims from arbitration.
- Court must decide whether arbitration should cover only individual claims or also class claims, and whether arbitrator or court should resolve that issue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the agreement permits class arbitration | Agreement is broad and silent on class arbitration, implying authorization of class claims. | Silence means no class arbitration; only individual claims proceed to arbitration. | Classification of class arbitration is a matter of arbitrability to be decided by the arbitrator. |
| Who decides whether the agreement permits class arbitration | Arbitrator should decide based on broad contract language and supporting authorities. | Court should decide given whether agreement permits class arbitration is a threshold issue. | Arbitrator decides the question of whether the agreement permits class arbitration (procedural arbitrability). |
| Whether AAA Supplementary Rules for Class Arbitrations apply | Suppl. Rules apply; arbitrator can determine class arbitration question. | Rules do not automatically apply or bind arbitrator without consent. | AAA Supplementary Rules apply; arbitrator will determine class arbitration issue. |
Key Cases Cited
- Stolt-Nielsen S.A. v. AnimalFeeds International Corp., 559 U.S. 662 (U.S. 2010) (silence on class-arbitration issue not sufficient to imply consent; contract-based determinations required)
- Green Tree Financial Corp. v. Bazzle, 539 U.S. 444 (U.S. 2003) (whether arbitration allows class claims is a matter for arbitrator when not expressly decided)
- Jock v. Sterling Jewelers Inc., 646 F.3d 113 (2d Cir. 2011) (distinguishes between silence and lack of express authorization in class-arbitration questions)
- Sutter v. Oxford Health Plans LLC, 675 F.3d 215 (3d Cir. 2012) (arbitrator may determine implicit authorization of class arbitration when not explicit)
- Fantastic Sams Franchise Corp. v. FSRO Ass’n Ltd., 683 F.3d 18 (1st Cir. 2012) (arbitrator decides associational arbitration under broad arbitration clauses)
- Reed v. Florida Metropolitan University, Inc., 681 F.3d 630 (5th Cir. 2012) (adopts Supplementary Rules for Class Arbitrations; arbitrator determines class status)
- Employers Insurance Co. of Wausau v. Century Indemnity Co., 443 F.3d 573 (7th Cir. 2006) (arbitrator decides procedural questions like consolidation; is guidance for class arbitrations)
- Blue Cross & Blue Shield of Massachusetts, Inc. v. BCS Insurance Co., 671 F.3d 635 (7th Cir. 2011) (confirms arbitrator’s discretion on consolidation/class-related questions)
- Champ v. Siegel Trading Co., 55 F.3d 269 (7th Cir. 1995) (early rule discussed class arbitration before Bazzle; later abrogated in part by Bazzle)
- Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (U.S. 2002) (gateway questions for arbitrability reserved for arbitrator or court depending on issue)