Wallace v. Red Bull Distributing Co., 958 F. Supp. 2d 811

Wallace applied for and was offered a District Sales Manager job with Red Bull; on Jan. 6, 2011 he signed an RBDC employment agreement and later the RBNA Mutual Arbitration Agreement as part of new-hire paperwork.
The RBNA Agreement (signed after the RBDC form) contains an integration clause, California choice-of-law, incorporation of AAA Employment Rules, and procedures referencing California arbitration law.
Wallace was terminated and sued for racial discrimination (federal) and state-law claims; defendants moved to dismiss/stay and compel arbitration under the FAA.
Wallace conceded his claims fall within the arbitration clauses but argued no valid agreement governs (competing forms) and that the agreement is unconscionable.
The court found the RBNA Agreement controlling (integration clause and later signature), applied California law, examined unconscionability in light of AT&T Mobility v. Concepcion, and concluded procedural unconscionability was minimal and substantive unconscionability was not shown.
Court compelled arbitration of all claims and dismissed the case.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Which agreement governs (RBDC form or RBNA Agreement)?	Wallace: ambiguous; parol evidence prevents determining which applies and defendants could pick favorable terms	Defendants: RBNA Agreement controls because it was signed later and has an "Entire Agreement" clause	RBNA Agreement governs; integration clause and later signature dispositive
Is the arbitration agreement procedurally unconscionable?	Wallace: adhesive contract, little time to review, not given arbitration rules or counsel	Defendants: standard employment arbitration, incorporation by reference is sufficient; adhesion produces only minimal procedural unconscionability	Agreement is adhesive but procedural unconscionability is minimal under California law and Concepcion
Is the arbitration agreement substantively unconscionable?	Wallace: discovery limits, forum/choice-of-law clauses, unilateral modification, fee-shifting deter claims	Defendants: provisions are neutral or permitted (discovery limits allowed; choice-of-law valid; fee provision follows applicable law)	No substantive unconscionability found; Concepcion forecloses many state-law challenges to arbitration-specific terms
Remedy / disposition — stay or dismiss; compel arbitration?	Wallace: opposes compelling arbitration	Defendants: move to compel; seek dismissal or stay	Court compelled arbitration of all claims and dismissed the case (dismissal appropriate when nothing remains for court)

Moses H. Cone Memorial Hospital v. Mercury Construction Corp., 460 U.S. 1 (1983) (federal policy favors arbitration and courts must enforce written arbitration agreements)
Shearson/American Express Inc. v. McMahon, 482 U.S. 220 (1987) (FAA standards for arbitration enforcement)
Stout v. J.D. Byrider, 228 F.3d 709 (6th Cir. 2000) (four-prong test for motions to compel arbitration)
Great Earth Companies v. Simons, 288 F.3d 878 (6th Cir. 2002) (opponent must show genuine issue of material fact to avoid arbitration; standard like summary judgment)
Javitch v. First Union Securities, Inc., 315 F.3d 619 (6th Cir. 2003) (FAA enforcement mechanisms; stays and orders to compel)
AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (FAA preempts state rules that single out arbitration agreements for disfavor, notably affecting unconscionability analysis)
Armendariz v. Foundation Health Psychcare Services, Inc., 24 Cal.4th 83 (Cal. 2000) (California framework requiring procedural and substantive unconscionability; "modicum of bilaterality")
Discover Bank v. Superior Court, 36 Cal.4th 148 (Cal. 2005) (pre-Concepcion rule finding some class-waiver provisions unconscionable in adhesive consumer contracts; discussed and limited by Concepcion)