Scott Hause v. City of Sunbury
20-1933
| 3rd Cir. | Mar 11, 2022Background
- Scott Hause, a Sunbury, PA police officer of 13 years, served as president of the Sunbury Police Officers Association (SPOA) from Jan. 2014 to Sept. 2016.
- Hause participated in 2015 collective-bargaining negotiations; after an impasse, binding arbitration preserved some longevity/time-in-service benefits for officers.
- Hause alleges that, after arbitration, Sunbury initiated a course of conduct targeting bargaining-unit members over 40, creating a hostile work environment and terminating him because of his age (ADEA claim) and in retaliation for his association with the SPOA (First Amendment claim).
- The City moved to dismiss under Rule 12(b)(6) and, alternatively, to compel arbitration; the District Court granted dismissal, denied judicial notice of an arbitration award, and declined to resolve the arbitration motion.
- The District Court also dismissed Hause’s amended complaint, denied further leave to amend, and left the motion to compel arbitration unresolved; Hause appealed.
- The Third Circuit vacated and remanded, holding that the District Court should have addressed the motion to compel arbitration before resolving the Rule 12(b)(6) dismissal and directing the District Court to decide arbitrability in the first instance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Prioritization of motion to compel arbitration | Hause argued the court erred by dismissing his claims without first resolving arbitration motion | City argued dismissal on non-arbitration grounds was proper or that arbitration could be addressed later | Court: district courts should generally resolve motions to compel arbitration before other nonjurisdictional motions; remand for District Court to decide arbitrability first |
| Sufficiency of complaint under Rule 12(b)(6) | Hause alleged age discrimination and retaliatory association sufficient to survive dismissal | City argued allegations were too sparse to state ADEA or First Amendment claims | Court did not decide merits; vacated dismissal and remanded so arbitrability is resolved first |
| Denial of leave to amend | Hause sought leave to amend after initial dismissal | City opposed further amendment | Court did not rule on propriety; remanded for further proceedings after arbitration issue is decided |
| Judicial notice of arbitration award / motion to compel arbitration | Hause contested taking judicial notice and enforcement of the arbitration award at dismissal stage | City sought judicial notice of the arbitration opinion and to compel arbitration under FAA | Court found District Court erred in failing to address the motion to compel; remanded so District Court can decide arbitration motion in the first instance |
Key Cases Cited
- Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213 (1985) (FAA mandates district courts direct parties to arbitration when agreement exists)
- Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (court may compel arbitration only where it has jurisdiction over the underlying dispute)
- Reyna v. Int'l Bank of Commerce, 839 F.3d 373 (5th Cir. 2016) (courts should address arbitrability at outset)
- Sharif v. Wellness Int'l Network, Ltd., 376 F.3d 720 (7th Cir. 2004) (district court erred by refusing to consider arbitration motion due to other pending challenges)
- Gray Holdco, Inc. v. Cassady, 654 F.3d 444 (3d Cir. 2011) (delay in moving to compel arbitration can forfeit ability to enforce it)
- Klotz v. Celentano Stadtmauer & Walentowicz LLC, 991 F.3d 458 (3d Cir. 2021) (standards for Rule 12(b)(6) review)
- Barna v. Bd. of Sch. Dirs. of Panther Valley Sch. Dist., 877 F.3d 136 (3d Cir. 2017) (appellate courts may correct forfeited pure questions of law)
- Singleton v. Wulff, 428 U.S. 106 (1976) (appellate courts generally do not decide issues not passed upon below)