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Wheeler v. Dollar Tree Stores, Inc.

United States District Court, W.D. Louisiana, Lafayette Division

August 8, 2017


          JAMES JUDGE.



         Currently pending is the defendant's motion to dismiss and compel arbitration. (Rec. Doc. 6). The motion was referred to this Court for review, report, and recommendation in accordance with the provisions of 28 U.S.C. § 636 and the standing orders of this Court. The motion is opposed. (Rec. Doc. 13). Considering the evidence, the law, and the arguments of the parties, and for the reasons fully explained below, this Court defers ruling on the motion and orders limited discovery and further briefing with regard to the issues raised in the defendant's motion.


         This is an employment discrimination lawsuit. In her original petition for damages, the plaintiff alleged that she is an African-American woman who was employed by the defendant, Dollar Tree Stores, Inc., and was told by her supervisor that she would not be promoted to a store manager's position because there were already too many African-American managers working for the company. She also alleged that she was required by her employer to work “off the clock.” She claims that she was suspended from her employment on August 15, 2016, allegedly in retaliation for having complained about being mistreated because of her race. After filing a discrimination charge with the EEOC and receiving a right to sue letter, she filed this lawsuit, asserting claims under Louisiana's Employment Discrimination Law, La. R.S. 23:301, et seq. and a claim for the deliberate underpayment of wages in violation of the Fair Labor Standards Act, 29 U.S.C. § 201, et seq.

         The defendant responded to the plaintiff's complaint with the instant motion. The defendant contends that, on December 8, 2015, the plaintiff electronically signed an enforceable arbitration agreement, which requires that the claims asserted in her complaint be resolved through arbitration rather than through litigation of this lawsuit. The defendant seeks to compel arbitration and have this lawsuit dismissed. In response, the plaintiff denied that she ever executed an arbitration agreement - electronically or with a handwritten signature - or orally agreed to arbitration. The parties' positions raise several questions that preclude resolution of the defendant's motion at this time but likely can be answered following targeted discovery.

         Law and Analysis

         A. The Legal Standard

         Although the defendant seeks dismissal of the lawsuit, it did not identify a statute, court rule, or jurisprudential principle under which dismissal is sought other than Rule 12(b) of the Federal Rules of Civil Procedure, nor did the defendant explain the standard that must be applied in order for a complaint to be dismissed when an arbitration agreement is enforced.

         The Federal Arbitration Act (“FAA”) provides for a stay pending arbitration.[1]A court, however, may dismiss the action with prejudice, rather than stay it, when all claims are subject to arbitration.[2] This is so because “[a]ny postarbitration remedies sought by the parties will not entail renewed consideration and adjudication of the merits by the controversy but would be circumscribed to a judicial review of the arbitrator's award in the limited manner prescribed by law.”[3]

         Rule 12(b) of the Federal Rules of Civil Procedure does not specifically provide for dismissal of an action based on the enforcement of an arbitration clause, and the Fifth Circuit has not yet explicitly decided whether Rule 12(b)(1) or Rule 12(b)(3) is the proper vehicle for resolving a motion to compel arbitration.[4]

         The defendant did not suggest that its motion should be analyzed under Rule 12(b)(1). Rule 12(b)(1) is used to challenge the court's subject-matter jurisdiction. This lawsuit originated in state court, and the defendant removed it to this forum, contending that the court has subject-matter jurisdiction over the action. A removing defendant - including the defendant in this action - has the burden of establishing the court's subject-matter jurisdiction since it is the party invoking the court's jurisdiction.[5] It would defy logic for a defendant to argue simultaneously that the court both does and does not have subject-matter jurisdiction. Further, if the court lacked subject-matter jurisdiction over this action, the logical consequence would be remand of the action to state court not dismissal of the action. Therefore, the defendant's motion will be construed as arising under Rule 12(b)(3).

         A Rule 12(b)(3) motion is used to challenge venue. The United States Supreme Court has described an arbitration agreement as a “specialized kind of forum-selection clause.”[6] Therefore, it is logical that the enforceability of such agreements may be scrutinized under Rule 12(b)(3). When resolving a Rule 12(b)(3) motion, “the court must accept as true all allegations in the complaint and resolve all conflicts in favor of the plaintiff.”[7] The court may also look outside of the complaint and its attachments and review extrinsic materials, including affidavits.[8] Facts must be viewed in a light most favorable to the plaintiff, [9] and conflicts in the parties' affidavits must be resolved in favor of the plaintiff.[10] Accordingly, there is a statutory basis for this Court to order the parties to gather more relevant evidence to assist in deciding the pending motion.

         B. The Standard for Enforcing of an Arbitration Agreement

         Arbitration is favored under both Louisiana law[11] and federal law.[12] In fact, there is a strong presumption in favor of arbitration, and the burden is on the party challenging ...

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