Case Information
UNITED STATES DISTRICT COURT DISTRICT OF CONNECTICUT JOHN J. CLAY, JR.,
Plaintiff , No. 3:23-cv-01575-MPS v.
FGO LOGISTICS, INC., COSTCO WHOLESALE
CORPORATION, and CHRISTOPHER SOLDI,
Defendants . RULING ON MOTION TO COMPEL ARBITRATION
I. INTRODUCTION
Plaintiff John Clay, Jr. brought this action against Defendants FGO Delivers, LLC (“FGO”), [1] Costco Wholesale Corporation (“Costco”), and Christopher Soldi alleging that he was sexually harassed, racially discriminated against, and terminated from his position in retaliation for his complaints about Defendants’ harassment and discrimination. Defendants moved to compel arbitration, arguing that Clay signed a valid arbitration agreement when he was hired by FGO’s affiliate, and that the agreement is enforceable under both state and federal law. For the reasons explained below, I deny Defendants’ motions to compel arbitration without prejudice.
II. FACTS
A. Factual Background
The following facts are drawn from the complaint, along with the exhibits attached to the parties’ briefs, and for the purposes of this ruling, I treat them as undisputed unless otherwise indicated.
1. The Parties
FGO is a “[f]inal [m]ile delivery solution for furniture, appliances and electronics in the United States,” ECF No. 1-1 ¶ 7, meaning it “operates a fleet of trucks that pick[] up goods from [large retail businesses’] warehouse[s] and delivers such goods to the homes of customers who have ordered the[m].” ECF No. 29 ¶ 5. “It maintains a fleet of over 500 vehicles[,] which complete approximately 3,400 deliveries every day.” Id. FGO is a wholly-owned subsidiary of Need It Now Delivers, LLC (“NIND”). Id. ¶¶ 2, 12; ECF No. 23-1 ¶ 1.
Costco is “an American multinational corporation[,] which operates a chain of membership-only big-box retail stores.” ECF No. 1-1 ¶ 8 . Costco is one of FGO’s clients. Id. ¶ 15.
Clay, a Connecticut resident, is a “Black man of African American heritage.” ECF No. 1-1 ¶ 1. He was hired as a Dispatcher at Expressway Courier & Freight, LLC (“Expressway”)— another wholly-owned subsidiary of NIND—in 2019. ¶ 11; ECF No. 23-1 ¶ 3; ECF No. 29 ¶ 3. He was promoted to the position of Account Manager at Expressway in 2020. ¶ 8. In either August 2020 or 2021, [2] he was transferred from Expressway to FGO, ECF No. 1-1 ¶ 14; ECF No. 23-1 ¶ 6l; ECF No. 29 ¶ 4, and on October 29, 2021, he was promoted to the position of General Manager of Logistics at FGO, ECF No. 1-1 ¶¶ 14-15; ECF No. 29 ¶ 9. I
In all these roles, Clay was “responsible for the interstate delivery of goods in Connecticut, Massachusetts, and western New York.” ECF No. 29 ¶¶ 7-9. Clay was also responsible for managing FGO’s Costco account. ECF No. 1-1 ¶¶ 15-16.
2. Alleged Harassment
Because Clay managed FGO’s Costco account, he worked with and for Defendant Soldi, who until November 4, 2021 worked as a Costco Warehouse Manager. ECF No. 1-1 ¶¶ 16, 16.47. Clay contends that Soldi “used his position and authority over [him] to taunt, harass, bully, and terrorize [him],” and details in his complaint numerous examples of racist and sexual remarks made by Soldi to Clay and his colleagues. Id. ¶ 16.
Clay alleges that he reported Soldi’s conduct on several occasions. For example, on August 19, 2021, he told Joe Haight—who at the time was serving as FGO’s Senior Vice President and Clay’s direct supervisor, id. ¶ 12—“that we need to watch Chris Soldi because he says some ‘sus stuff’ (suspicious stuff).” Id. ¶ 16.2. On the same day, Clay had a phone call with Haight and his colleague, Abel Ceballo, “to brief Mr. Haight and FGO about how uncomfortable Mr. Soldi of Costco ha[d] made the work environment.” Id. ; see also id. at ¶¶ 16.3, 16.17.
On October 14, Clay and Ceballo spoke to Jodi Thompson, a Costco Warehouse Supervisor, about Soldi’s mistreatment. Id. ¶ 16.18. She told them to “report him,” but otherwise did nothing to help him. Id. On the same day, Clay told Haight that Soldi “was trying to manipulate [Clay] into becoming the General Manager” and that he was “nervous about having to report to Chris Soldi” if he took that role. Haight told him that he “ha[d] to accept the promotion…and report directly to Chris Soldi because [FGO’s president] want[ed] to please Chris Soldi.”
Clay also sent Haight screenshots of inappropriate messages Soldi sent him and Ceballo. See, e.g., id. ¶¶ 16.12, 16.14, 16.22. For example, on October 18, Clay sent Haight “screenshots of some of the uncomfortable sexual comments Chris Soldi made toward the Plaintiff,” but Haight “did nothing about it.” Id. ¶ 16.22.
Clay alleges that Haight not only failed to redress Soldi’s misconduct but also himself made inappropriate remarks to Clay. For example, on October 15, Haight “made a gay joke about the Plaintiff taking it from behind.” Id. ¶ 16.19. And when Clay informed Haight that Soldi had made a joke about him being a “slave,” Haight responded: “[w]e’re all slaves to our customers.” Id. ¶ 16.28.
Clay nonetheless continued to raise his concerns with Haight and others. For example, on November 2, he told Haight that he was “extremely stressed from the hostile office atmosphere.” Id. ¶ 16.41. The following day, Soldi “sent the Plaintiff extremely inappropriate pictures and notes,” and “made inappropriate comments to the Plaintff about [a female coworker].” Id. ¶ 16.44. Thompson “admitted to knowing about [this].” Id. That same day, Clay sent Haight “a video of…inappropriate racial comments Chris Soldi made to” him and Ceballo. Id. ¶ 16.45.
Costco fired Soldi on November 4, 2021, id. ¶ 16.47, but Soldi continued to send Clay harassing and threatening text messages, id. ¶¶ 16.48, 16.50. On November 26, Clay told Haight that he was concerned that Soldi might try to “get retribution” by using his friendship with FGO’s president to cause Clay to lose his job. Id. ¶ 16.49. The last harassing text message that Clay alleges he received from Soldi was sent on November 30. ¶¶ 16.50.
3. Alleged Retaliation Clay alleges that on March 18, 2022, FGO posted two positions on the job search website, Indeed: “one for a General Manager for Costco, and one for a General Manager for Nestle, each at a salary of $70,000.” ¶ 16.51. Clay asked his manager about these postings and complained that he was underpaid because he made $70,000 and managed both of these accounts. Id. His manager told him that the listings were a “mistake” and that FGO would take them down that day. Id. As of March 29, both postings were still listed on Indeed. Id. ¶ 16.52. As of April 9, the Nestle posting had been deleted but the Costco posting was still listed. Id. ¶ 16.53.
On April 29, 2022, Clay was terminated from his employment with FGO Logistics. Id. ¶ 19. FGO said that his termination was due to Clay’s dress code violations, “unaccounted time spent away from the client with unknown whereabouts,” and lack of preparation during conference calls. Id. Clay alleges that these reasons were “pretext to terminate [him] in retaliation for complaining about the racial and sexual harassment he experienced,” as well as for complaining about being undercompensated.
4. Arbitration Agreement According to FGO, Clay was presented with and signed a three-page arbitration agreement in connection with his employment at Expressway. ECF No. 23-1 ¶¶ 3-4 . Clay contends that he “do[es] not remember receiving or signing any arbitration agreement when [he] started working for Expressway,” ECF No. 29 ¶ 14, and “do[es] not recall sending any documents back to [Expressway],” ECF No. 29 ¶ 19. But he admits that “when he started with [Expressway], [his] manager asked [him] to sign something.” ¶¶ 15-16. Clay admits that he signed this document but says that he did so without reading it; he also avers that no one told him he was signing an arbitration agreement, and that “[i]f anyone had told [him] the implications of signing [an arbitration] agreement, [he] would not have signed it.” Id. ¶¶ 16-18.
FGO has produced copies of the first and third pages of the agreement Clay signed, but admits that “our copy is missing the second page.” ECF No. 23-1 ¶ 4; see ECF No. 23-2 at 2-3. The first page specifies that the agreement applies “to any dispute brought by either Employee or Employer arising out of or related to the Employee’s employment with Employer (“Employment”) or Employee’s relationship, including termination of the relationship, with Employer and/or Employer’s clients, officers, directors, agents, parents, principals, subsidiaries, affiliates, other employees, contractors and representatives, and all of their respective successors and assigns.” Id. at 2. It further specifies that it is “intended broadly to apply to all covered claims,…subject to the exclusions in Section 1(A)(ii).” Id. Section 1(A)(ii) does not appear on pages one or three of the agreement. Id. at 2-3.
The third page reflects Clay’s printed name and signature. Id. at 3. It also contains the
following “Governing Law” provision:
This Arbitration Agreement shall be governed by the Federal Arbitration Act, 9 U.S.C. §1, et seq., to the extent it is applicable and otherwise this Arbitration Agreement and the rights of the parties hereunder shall be governed by and construed in accordance with the laws of the state where Employee is or was employed by Employer, exclusive of conflict or choice of law rules. at 3. And, in bold, capitalized letters immediately above Clay’s signature, it states:
EMPLOYER AND EMPLOYEE HAVE EACH READ, BEEN PROVIDED WITH A REASONABLE TIME TO REVIEW, AND UNDERSTAND THIS AGREEMENT, AND UNDERSTAND THAT THIS AGREEMENT TO BINDING ARBITRATION CONSTITUTES A WAIVER OF TRIAL BEFORE JUDGE OR JURY AND WAIVER OF PARTICIPATION IN CLASS, COLLECTIVE, CONSOLIDATED OR REPRESENTATIVE ACTIONS. Though FGO has been unable to produce the second page of Clay’s arbitration agreement, it has submitted a declaration from Barrett Wolf, the manager of both Expressway and FGO at the relevant times, stating that, at the time Clay was hired, all Expressway employees were “presented with and required to sign” an arbitration agreement and that “[t]he provisions of the[se] arbitration agreements were identical.” ECF No. 23-1 ¶ 3. Attached to the declaration are “three examples of the full agreements signed at that time by Expressway employees.” ¶ 5; see ECF No. 23-3 at 2-10. These three examples are identical to one another, and the first and third pages are identical to the first and third pages of Clay’s agreement. See id. ; ECF No. 23-2 at 2-3. The declaration further states that the agreement that was provided to Clay contained the same second page as the one contained within these examples. ECF No. 23-1 ¶ 5. These second pages contain Section 1(A)(ii), which reads as follows:
Nothing in this Agreement prohibits Employee from filing a charge, testifying, assisting, or participating in any manner in an investigation, hearing, or proceeding before any government agency, but Employee waives any right to any form of recovery, compensation or other remedy in any action brought by Employee or on Employee’s behalf based on a covered claim.
ECF No. 23-3 at 3, 6, 9.
B. Procedural Background
Clay filed his complaint on November 1, 2023 in Connecticut superior court. ECF No. 1- 1 at 2, 4. His complaint raises the following claims against all Defendants: hostile work environment under Connecticut Fair Employment Practices Act (“CFEPA”), Conn. Gen. Stat. § 46a-60(b); sexual harassment under CFEPA, id. § 46a-60(b)(8); and intentional infliction of emotional distress. ECF No. 1-1. He also brings the following claims against FGO alone: wrongful termination on the basis of color under CFEPA, id. § 46a-60(b)(1); wrongful termination on the basis of race under CFEPA, id. § 46a-60(b)(1); retaliation for opposing discriminatory conduct under CFEPA, id. § 46a-60(b)(4); and wrongful termination on the basis of race under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e. ECF No. 1-1. Defendants removed Plaintiff’s case from the Connecticut superior court to this Court on December 1. ECF No. 1.
On January 8, 2024, Defendants filed the pending motions to compel arbitration. ECF No. 23; ECF No. 24; ECF No. 25. Clay filed a response, ECF No. 28, and Defendants filed replies, ECF No. 32; ECF No. 33; ECF No. 35. Clay later moved for leave to file a sur-reply. ECF No. 36. I denied this motion, explaining that I would “not consider any arguments raise for the first time in Defendants’ reply briefs.” ECF No. 38.
The parties’ filed a joint motion to stay discovery pending the Court’s ruling on the motions to compel arbitration, ECF No. 22, which I granted, ECF No. 37. I later partially lifted this stay, however, because “[u]pon a preliminary review, it appear[ed] that the motions to compel arbitration may turn on factual issues that the parties ha[d] not yet had the opportunity to develop in discovery.” ECF No. 39. I allowed “the Defendants to take a deposition of Plaintiff and…[the Plaintiff] to depose a single witness of either an employee of one of the Defendants or a Rule 30(b)(6) representative of one of the corporate defendants.” I also directed the parties to file supplemental memoranda.
Defendants submitted supplemental memoranda in accordance with my order. ECF No. 46; ECF No. 47; No. 48. Clay did not. Instead, he moved for a 21-day extension to respond to these briefs. ECF No. 49. I granted a 14-day extension, ECF No. 50, which Defendants moved to set aside on the grounds that it would “afford[] [Clay] the sole final word regarding arbitrability and deprive[] Defendants of any chance to respond to Plaintiff’s supplemental arguments.” ECF No. 51 at 2. I denied Defendants’ motion but allowed them to file a reply to Plaintiff’s response. ECF No. 52. Plaintiff filed his response and then Defendants filed their replies. ECF Nos. 54-56, 59-60, 62.
On August 14, 2024, after the Second Circuit’s ruling in
Olivieri v. Stifle, Nicolaus &
Co., Inc.,
III. LEGAL STANDARDS
“In deciding motions to stay or compel arbitration, courts apply a standard similar to that
applicable for a motion for summary judgment.”
Boroditskiy v. Eur. Specialties LLC
, 314 F.
Supp. 3d 487, 492 (S.D.N.Y. 2018) (internal quotations marks omitted). That standard requires
this Court to “consider all relevant, admissible evidence submitted by the parties and contained
in pleadings, depositions, answers to interrogatories, and admissions on file, together
with…affidavits” and “draw all reasonable inferences in favor of the non-moving party.”
Nicosia v. Amazon.com, Inc.
,
IV. DISCUSSION
The parties contest (1) whether a valid arbitration agreement was formed; (2) whether an exemption in the Federal Arbitration Act (the “FAA”) makes that statute inapplicable, and, if so, whether Connecticut law nonetheless requires arbitration; and (3) whether the EFAA exempts the parties’ dispute from arbitration. As explained below, I conclude that the parties formed a valid arbitration agreement that is enforceable under Connecticut law—regardless of whether the FAA applies—but that the parties’ dispute is exempt from arbitration at Clay’s election under the EFAA.
A. Contract Formation
Connecticut law governs the question of contract formation in this case. The FAA does
not speak to contract formation and simply requires that arbitration agreements be enforced to
the same extent as other contracts.
See Monisoff v. Am. Eagle Inv., Inc
., No. 96-cv-7798, 1996
WL 708598, at *1 (2d Cir. Dec. 9, 1996) (“[A] court first must conclude that the parties intended
to arbitrate in the first instance before the scope of arbitration [under the FAA] may be defined.”
(internal quotations and alterations omitted));
Bell v. Cendant Corp.
,
Under Connecticut law, “an agreement must be definite and certain as to its terms and
requirements. So long as any essential matters are left open for further consideration, the
contract is not complete.”
Geary v. Wentworth Lab'ys, Inc.
,
Clay contends that Defendants cannot meet their burden of proving the existence of an
arbitration agreement under Connecticut law because they cannot produce the second page of the
agreement. He relies primarily on
Dreyfuss v. E-Telecare Global Solutions-US., Inc.
, 349 F.
App'x 551 (2d Cir. 2009). In
Dreyfuss
, the defendant sought to compel arbitration based upon an
agreement that the plaintiff signed as a condition of his employment. at 552. But the
defendant was unable to locate a complete copy of the arbitration agreement.
Id.
It could locate
only the last page, which was signed by the plaintiff, and “the first page of an arbitration
agreement which contain[ed] a fax line indicating that it was sent from [the plaintiff].”
Id.
Over
the course of discovery, the defendant “was able to produce at least three types of documents
containing arbitration agreements, which had been signed by…employees during the period of
[the plaintiff’s] employment,
but no single standard document
containing an arbitration clause.”
Id.
at 552-53 (emphasis added). Further, discovery revealed that “the majority of Defendant’s
employees did not sign arbitration agreements” at all.
Dreyfuss v. eTelecare Glob. Sols.-US,
Inc.
, No. 08-cv-1115,
Here, as in Dreyfuss , Defendants have produced only two pages of the parties’ purported arbitration agreement. ECF No. 23-1 ¶ 4; see ECF No. 23-2 at 2-3. The first page makes clear that the agreement’s application to various claims is “subject to the exclusions in Section 1(A)(ii),” which does not appear on the two pages provided. at 2. Without more, I could not conclude definitively that the parties intended to arbitrate the present dispute, because it might fall within one of the unseen “exclusions.” Nor could I find that the agreement’s terms and requirements were sufficiently definite and certain to constitute a valid and enforceable contract under Connecticut law.
But Defendants
have
provided more. Unlike in
Dreyfuss
, they have produced evidence
of a “single standard document containing an arbitration clause,” which all employees at the time
were required to sign.
Clay has not presented any evidence rebutting this showing. His “failure to recall” the
contents of the document “is insufficient to create a genuine dispute of material fact” as to what
was contained in that document.
Reynolds v. Quiros
, No. 3:21-cv-1064,
B. Section 1 of the FAA & Connecticut Law
The parties next dispute whether the agreement falls within an exemption from mandatory arbitration in the FAA and, if so, whether Connecticut law nonetheless requires arbitration. Specifically, Clay argues that he is exempt from arbitration under § 1 of the FAA, while Defendants contend that § 1 of the FAA does not apply to Clay and, even if it did, he would still be bound by the arbitration agreement under Connecticut law. As explained below, I do not decide the § 1 issue but conclude that Connecticut law would require arbitration here if not for the EFAA, which I discuss in the next section. [5]
Commonly referred to as the “transportation worker exemption,” § 1 of the FAA
excludes “contracts of employment of seamen, railroad employees, or any other class of workers
engaged in foreign or interstate commerce” from the FAA’s coverage. 9 U.S.C. § 1. Courts
have consistently held, however, that this provision does not preempt state arbitration law.
See,
e.g.
,
Bissonnette v. LePage Bakeries Park St., LLC
,
Costco and FGO raised this argument again in their supplemental memoranda, ECF No. 47 at 22; ECF No. 48 at 19- 22, Clay did not address it in his reply brief, ECF No. 54.
Nonetheless, in an abundance of caution, I note Clay is free to move to reconsider my ruling on Connecticut arbitration law if he believes that I have overlooked some argument or authority that might change the outcome. Any motion to reconsider on this or any other issue shall be filed in accordance with, and shall satisfy the standard articulated in, Local Rule 7.
The “Governing Law” provision of the parties’ arbitration agreement further supports the conclusion that the agreement is enforceable under Connecticut law even if it falls into the FAA’s transportation worker exemption. That provision specifies that the agreement “shall be governed by the [FAA] to the extent it is applicable and otherwise…shall be governed by and construed in accordance with the laws of the state where Employee is or was employed.” ECF No. 23-2 at 3 (emphasis added). Thus, even if the FAA does not apply because of the transportation worker exemption, Connecticut arbitration law applies.
Because Clay signed the arbitration agreement in November 2019, it is governed by
Connecticut’s Revised Uniform Arbitration Act (“RUAA”). Conn. Gen. Stat. Ann. § 52-407cc
et seq. (“Sections 52-407aa to 52-407eee, inclusive, govern an agreement to arbitrate made on or
after October 1, 2018….”);
see also City of Torrington v. Council 4, AFSCME, AFL-CIO, Loc.
442
,
Clay has not raised and the Court has not identified any such grounds. Clay’s claims that
he did not read the agreement and would not have signed it had he understood it are unavailing
as Connecticut law “ordinarily holds all competent adults responsible for the contents of the
documents they sign, whether they read the documents or not, whether they understand them or
not.”
RCS Recovery Servs., LLC v. Lennon, N
o. NNHCV126034520,
C. The EFAA
The EFAA provides that, “at the election of the person alleging conduct constituting a
sexual harassment dispute or sexual assault dispute,…no predispute arbitration agreement…shall
be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law
and relates to the sexual assault dispute or the sexual harassment dispute.” Pub. L. No. 117-90,
136 Stat. 26 (2022) (codified at 9 U.S.C. §§ 401–402). The law was enacted on March 3, 2022
and applies “with respect to any dispute or claim that arises or accrues on or after” that date.
Pub. L. No. 117-90, § 3,
1. The EFAA Applies to Clay’s Retaliation Claim
In Clay’s initial response to Defendants’ motions to compel arbitration, he argues that his
sexual harassment claims “did not arise until either November 2022, when he filed his Complaint
with the Connecticut Commission on Human Rights and Opportunities (“CHRO”), or November
2023, when [he] filed his Complaint in the Connecticut Superior Court.” ECF No. 28 at 2. He
relies primarily on
Famuyide v. Chipotle Mexican Grill, Inc.
, which held that “a dispute comes
into being when a person asserts a right, claim, or demand and is met with disagreement on the
other side.” No. 23-cv-1127,
While Defendants’ motions to compel arbitration were pending, the Second Circuit
issued a ruling regarding claim accrual under the EFAA.
Olivieri v. Stifle, Nicolaus & Co., Inc.
,
The Second Circuit explained that “the term ‘accrue’ means the same thing under the EFAA as it does in the statute-of-limitations context.” Id. at 78. Most claims are subject “to the normal knew-or-should-have-known accrual date.” Id. at 88. But claims that are “composed of a series of separate acts that collectively constitute one unlawful practice”—like hostile work environment claims—are subject to the continuing violation doctrine, which “lays out an alternative framework for evaluating accrual.” Id . (alteration and internal quotation marks omitted). These claims “accrue and reaccrue with each successive act that is part of the singular unlawful practice.” at 88. The Second Circuit concluded that the retaliatory conduct that Olivieri allegedly experienced after returning from maternity leave was “similar in kind to the retaliatory conduct she experienced before her leave, such that it [was] part of the same course of discriminatory conduct [underlying] her retaliation-based hostile work environment claims.” at 92 (alteration and internal quotation marks omitted). Accordingly, it held that her retaliation- based hostile work environment claims accrued after the EFAA’s effective date and affirmed the district court’s order denying the motion to compel arbitration. Id .
As noted, the parties have submitted supplemental briefs addressing Olivieri . Defendants argue that Olivieri is distinguishable from the present case, see ECF No. 58; ECF No. 61; ECF No. 63, while Clay contends that—like the retaliation-based hostile work environment claim in Olivieri —“the last act alleged in furtherance of [his sexual harassment, hostile work environment, and retaliation claims] occurred…after the EFAA was enacted,” ECF No. 57 at 3.
Clay’s argument fails as to his sexual harassment claim and hostile work environment claims. These claims are “[b]ased upon the conduct of…Soldi and executives at Defendants FGO and COSTCO who condoned Soldi’s words and actions,” as well as his employer’s failure “to protect him from this pervasive harassment” despite his complaints. ECF No. 1-1 ¶¶ 32, 34, 35. This discriminatory conduct predated the EFAA—Soldi was terminated by Costco on November 4, 2021, and the last alleged act of harassment by Soldi occurred on November 30, 2021. ¶¶ 16.47, 16.50. Though Clay alleges that “he was fired in retaliation for complaining about the hostile work environment and discrimination he experienced” in April 2022—after the EFAA’s effective date—this post-EFAA conduct is not “similar in kind” to the pre-EFAA conduct that forms the basis of these claims. Because the retaliatory conduct that Clay alleges occurred after the EFAA’s effective date cannot be said to be a part of the “same course of discriminatory conduct” as his pre-EFAA allegations, Clay’s hostile work environment and sexual harassment claims did not accrue after the EFAA’s effective date.
But Clay’s retaliation claim did. The potentially retaliatory conduct on which this claim is based is his termination from FGO on April 29, 2022—two months after the EFAA’s effective date. ECF No. 1-1 ¶¶ 19, 21, 38. And the Second Circuit in Olivieri made clear that claims of retaliation resulting from a report of sexual harassment are “sexual harassment disputes” as defined by the EFAA:
The EFAA defines a “sexual harassment dispute” as “a dispute
relating
to conduct
that is alleged to constitute sexual harassment under applicable Federal, Tribal, or
State law.” 9 U.S.C. § 401(4) (emphasis added). This Court has recognized that
retaliation for reporting discrimination is reasonably related to the underlying
discrimination, such that a plaintiff who exhausts a discrimination claim with the
EEOC may also pursue a claim for retaliation.
Legnani v. Alitalia Linee Aeree
Italiane, S.P.A.
,
Though Clay’s retaliation claim may be “intertwined” with his sexual harassment and
hostile work environment claims, it is a “separate and independent cause[] of action.”
Miner v.
Town of Cheshire
,
Though I find the reasoning in these cases persuasive, this case differs from Johnson and Delo in two significant ways. First, it presents multiple claims related to sexual harassment— only one of which accrued after the EFAA’s enactment date— as well as claims not related to sexual harassment. Second, the only claim to which the EFAA applies pertains to only one of the three defendants.
At least one court has applied
Johnson
’s reasoning to such a fact pattern.
See Molchanoff
Nonetheless, the Molchanoff court concluded that “the EFAA bar[red] enforcement of the arbitration agreement…as to all claims in th[e] case, and as to all Defendants.” at *5. It rejected the defendants’ argument that “the EFAA [could ]not bar arbitration of…[the] claims [that accrued pre-EFAA] because the statutory note to the Act clearly delineates applicability to claims or disputes that arise or accrue after the enactment date of the EFAA”:
[T]he text of the EFAA is plain and unambiguous in that, “at the election of the person alleging conduct constituting a sexual harassment dispute or sexual assault dispute,…no predispute arbitration agreement…shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the …sexual harassment dispute .” The ordinary interpretation of “case” is a proceeding which may encompass many claims or disputes.…On the other hand, a claim is “a statement that something yet to be proved is true” or “the assertion of an existing right; any right to payment or to an equitable remedy, even if contingent or provisional.” Similarly, a dispute is “a conflict or controversy, esp. one that has given rise to a particular lawsuit.”…In other words, the EFAA keys the scope of the invalidation of the arbitration clause to the entire ‘case’ relating to the sexual harassment dispute and thus does not limit the invalidation to the claim or claims in which that dispute plays a part. at *4 (citations, alterations, and some internal quotation marks omitted). The court also
agreed with the
Johnson
court that “ ‘Congress’s choice to amend the FAA directly with text
broadly blocking enforcement of an arbitration clause with respect to an entire “case” “relating
to” a sexual harassment dispute reflects its rejection…of the FAA norm of allowing individual
claims in a lawsuit to be parceled out to arbitrators or courts depending on each claim's
arbitrability.’ ” at *4-*5 (quoting
Johnson
,
I agree with and adopt the
Molchanoff
court’s reasoning. While it is true that the
effective date provision of the EFAA states that “[t]his Act, and the amendments made by this
Act, shall apply with respect to any
dispute or claim
that arises or accrues” on or after March 3,
2022, Pub. L. No. 117-90, § 3,
This reading of the EFAA also fits with “Congress’s intent to override—in the sexual
harassment context—the FAA’s background principle that, in cases involving both arbitrable and
non-arbitral claims, the former must be sent to arbitration even if this will lead to piecemeal
litigation.”
Johnson
,
I. CONCLUSION
In sum, though the parties formed an arbitration agreement that is enforceable under
Connecticut law, the agreement is unenforceable at Clay’s election under the EFAA. I must thus
DENY Defendants’ Motions to Compel Arbitration, ECF No. 23; ECF No. 24; ECF No. 25.
Because Defendants have reserved the right to file motions to dismiss, ECF No. 23-4 at 19 n.5;
ECF No. 24-1 at 16 n.6, and because the EFAA applies to only
plausibly
pled sexual harassment
disputes,
Yost v. Everyrealm, Inc.
,
Michael P. Shea, U.S.D.J.
Dated: Hartford, Connecticut
September 27, 2024
Notes
[1] According to FGO, it was improperly named “FGO Logistics, Inc.” in Clay’s complaint. ECF No. 33 at 1.
[2] Clay has made inconsistent statements regarding when he was transferred to FGO. ECF No. 1-1 ¶ 14; ECF No. 29 ¶ 4.
[3] Clay’s argument that Rule 1004 of the Federal Rules of Evidence bars me from considering the arbitration agreements of the other employees to prove the content of the document he signed, see ECF No. 28 at 11, fails based on the language of the Rule. Rule 1004(a) provides that evidence other than an original is admissible to prove the content of a writing if the original is lost or destroyed and not by the proponent of the evidence acting in bad faith. The declaration from FGO’s manager states that, after review of the company files, the manager was able to locate only the first and third pages of the document Clay signed. (The manager speculates Clay “may have returned only the first and third pages.”) ECF No. 23-1 ¶ 4. As Clay has not produced the second page, this is adequate evidence that the original has been lost or destroyed. See Fed. R. Evid. 1004(c). And Clay has offered no evidence that FGO lost or destroyed the original in bad faith, nor would it be reasonable to draw that inference from the evidence in the record.
[4] It matters not that Expressway did not sign the agreement.
See Hoye v. DeWolfe Co.
,
[5] On April 8, 2024, Clay moved for leave to file a sur-reply “to address new arguments made for the first time by the Defendants in their reply briefs,” including their contention “that even if the Plaintiff is exempt from arbitration under the FAA, the Plaintiff must arbitrate his claims under Connecticut law.” ECF No. 36 at 1-2. I denied this motion, explaining that I would “not consider any arguments raised for the first time in the Defendants’ reply briefs.” ECF No. 38. Defendants’ argument that Connecticut law requires arbitration of this dispute was not raised for the first time in their reply brief; FGO’s original motion to compel argued that both “federal and Connecticut law” favored arbitration and cited several Connecticut law cases in support of this point. ECF No. 23-4 at 9-10. I also subsequently provided Clay with other opportunities to respond to this argument: I issued an order on April 22 directing the parties to file supplemental briefs regarding the motion to compel, ECF No. 39, and allowed Clay to file a response to Defendants’ supplemental briefs even though he failed to file one himself, ECF No. 50. Though
[6] FGO contends that Clay’s retaliation claim relates to his complaints about FGO’s racially discriminatory
pay practices, not his complaints of sexual harassment. ECF No. 23-4 at 19; ECF No. 63 at 6. It asserts that
“Plaintiff has not alleged, and in fact cannot allege, that his termination was related to the alleged sexual
harassment.”
Id
. But Clay
has
so alleged. Though he claims that he was underpaid due to his race, he contends that
his
termination
was “in retaliation for complaining about the racial
and sexual harassment
he experienced,” as well
as his complaints regarding his compensation. ECF No. 1-1 ¶¶ 19, 21 (emphasis added). That Clay’s retaliation
claim is related to both his sexual harassment and racial discrimination complaints does not remove it from the
EFAA’s ambit. “So long as the substance of the factual allegations supporting a claim can be fairly characterized,
at
least in part
, as alleged sexual harassment violations, the party bringing that claim may invoke the EFAA to
invalidate an otherwise enforceable arbitration agreement.”
Newton v. LVMH Moet Hennessy Louis Vuitton Inc.
,
No. 23-cv-10753,
[7] The EFAA applies “with respect to any dispute or claim that arises
or
accrues on or after” its effective
date. Pub. L. No. 117-90, § 3,