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Adams v. Citicorp Credit Services, Inc.

United States District Court, M.D. North Carolina

March 20, 2015

HENRY DENNIS ADAMS, et al., Plaintiffs,
v.
CITICORP CREDIT SERVICES, INC., Defendant

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[Copyrighted Material Omitted]

Page 443

For HENRY DENNIS ADAMS, on behalf of himself and all others similarly situated, KELLY HARRISON, on behalf of herself and all others similarly situated, JAMES E. WHITFIELD, JR., on behalf of himself and all others similarly situated, KATHERINE KRAEMER, on behalf of herself and all others similarly situated, Plaintiffs: EVAN M. JANUSH, LEAD ATTORNEY, THE LANIER LAW FIRM, PLLC, NEW YORK, NY; JAMES AVERY ROBERTS, III, LEAD ATTORNEY, PAIGE LORALEA PAHLKE, LEWIS & ROBERTS, PLLC, RALEIGH, NC; PAUL R. DICKINSON, JR., LEAD ATTORNEY, PAIGE LORALEA PAHLKE, LEWIS & ROBERTS, PLLC, CHARLOTTE, NC; FRANKLIN D. AZAR, KEITH R. SCRANTON, FRANKLIN D. AZAR & ASSOCIATES, P.C., AURORA, CO.

For TAMMY DECKER, EBONIE POWELL, KAHLI DEARANI, SHAMICULA THOMPSON, CYNTHIA L. MCGRIFF, STEPHANIE HEITGER, TANGELA SELLARS, DAVID S. TALBERT, III, REGINA LAFLEUR, DANYEL MCFADDEN, JEFFREY FERGUSON, CHANDRA SMALLWOOD, LATESHA MORRISON, KENYA OSBORNE, TAMU BARNHILL, TOMEKA DIXON, KENDRIC E. DAVIS, Plaintiffs: EVAN M. JANUSH, LEAD ATTORNEY, THE LANIER LAW FIRM, PLLC, NEW YORK, NY; FRANKLIN D. AZAR, FRANKLIN D. AZAR & ASSOCIATES, P.C., AURORA, CO; JAMES AVERY ROBERTS, III, LEAD ATTORNEY, LEWIS & ROBERTS, PLLC, RALEIGH, NC; PAUL R. DICKINSON, JR., LEAD ATTORNEY, LEWIS & ROBERTS, PLLC, CHARLOTTE, NC.

For TAMIKA L. EXUM, Plaintiff: JAMES AVERY ROBERTS, III, LEAD ATTORNEY, LEWIS & ROBERTS, PLLC, RALEIGH, NC; PAUL R. DICKINSON, JR., LEAD ATTORNEY, LEWIS & ROBERTS, PLLC, CHARLOTTE, NC.

MICHAEL BALDWIN, Plaintiff, Pro se.

For CITICORP CREDIT SERVICES, INC. (USA), Defendant: SARI M. ALAMUDDIN, LEAD ATTORNEY, GREGORY P. ABRAMS, MORGAN, MATTHEW A. RUSSELL, LEWIS & BOCKIUS LLP, CHICAGO, IL; GREGORY P. MCGUIRE, OGLETREE DEAKINS NASH SMOAK & STEWART, P.C., RALEIGH, NC.

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MEMORANDUM OPINION AND ORDER

L. Patrick Auld, United States Magistrate Judge.

This case comes before the Court on Defendant's Motion to Compel Arbitration for Plaintiffs Adams, Whitfield, and Kraemer and to Stay Proceedings (Docket Entry 29) and Plaintiffs' Motion for Conditional Certification as a Collective Action pursuant to the Fair Labor Standards Act (Docket Entry 37).[1] For the reasons that follow, the Court will grant in part, defer in part, and deny in part Defendant's Motion to Compel and will grant Plaintiffs' Motion for Conditional Certification.

I. BACKGROUND

Four Plaintiffs (Henry Adams, Kelly Harrison, James Whitfield, and Katherine Kraemer) (collectively " Plaintiffs" or " Named Plaintiffs" ) initiated this action against Citicorp Credit Services, Inc. (" Citi" ) " on behalf of themselves and other similarly situated current and former hourly employees . . . for engaging in a systematic scheme of wage abuses against its hourly-paid customer service telephone operator employees working at Citi's call center located in Greensboro, North Carolina." (Docket Entry 23 at 1-2.)[2] Their Amended Complaint alleges that Citi:

(1) " fail[ed] to properly record and pay its hourly customer service telephone operator employees for 'off-the-clock' work and overtime" (id. at 2);

(2) " encourag[ed], requir[ed], and/or creat[ed] circumstances necessitating said employees to work off the clock" (id.);

(3) " requir[ed] said employees to improperly record their time records" (id.); and

(4) " encourag[ed] or requir[ed] said employees to work off the clock to conduct work-related activities, including time spent logging in and out of computer and telephone systems, attending mandatory meetings, and reading required materials necessary for the performance of their jobs" (id.).

Plaintiffs allege that, as a result of this " scheme" of wage abuses, Citi violated the federal Fair Labor Standards Act (" FLSA" ) and the North Carolina Wage and Hour Act (" NCWHA" ). (Id. at 1-2.)

Citi subsequently filed the instant Motion to Compel. (Docket Entry 30.)[3] Plaintiffs responded (Docket Entry 47) and Citi replied (Docket Entry 57). In the same period, Plaintiffs filed the instant Motion for Conditional Certification (Docket Entry 37), as to which Citi responded (Docket Entry 63), Plaintiffs replied (Docket Entry 66), and Citi sur-replied (Docket Entry 68-1).

II. MOTION TO COMPEL ARBITRATION

The Federal Arbitration Act (" FAA" ), 9 U.S.C. § § 1-16, establishes " a liberal federal policy favoring arbitration

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agreements." Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983). Pursuant to the FAA, " agreements to arbitrate must be enforced . . . ." Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218, 105 S.Ct. 1238, 84 L.Ed.2d 158 (1985). In determining whether to compel arbitration, a court should consider:

" (1) the existence of a dispute between the parties, (2) a written agreement that includes an arbitration provision which purports to cover the dispute, (3) the relationship of the transaction, which is evidenced by the agreement, to interstate or foreign commerce, and (4) the failure, neglect or refusal of [a party] to arbitrate the dispute."

Adkins v. Labor Ready, Inc., 303 F.3d 496, 500-01 (4th Cir. 2002) (quoting Whiteside v. Teltech Corp., 940 F.2d 99, 102 (4th Cir. 1991)). If a valid arbitration agreement covers the dispute at issue, the Court must " stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement . . . ." 9 U.S.C. § 3.

" 'In the context of motions to compel arbitration brought under the [FAA] . . . courts apply a standard similar to that applicable to a motion for summary judgment.'" Minter v. Freeway Food, Inc., No. 1:03CV00882, 2004 WL 735047, at *2 (M.D.N.C. Apr. 2, 2004) (unpublished) (quoting Bensadoun v. Jobe-Riat, 316 F.3d 171, 175 (2d Cir. 2003)). Accordingly, the Court should compel arbitration " if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). Such a dispute exists if the evidence presented could lead a reasonable factfinder to return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In considering that issue, the Court must view the evidence and any reasonable inferences therefrom in a light most favorable to the non-movant. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

To decide if a party agreed to arbitrate a dispute, " the [C]ourt should apply 'ordinary state-law principles that govern the formation of contracts.'" Johnson v. Circuit City Stores, 148 F.3d 373, 377 (4th Cir. 1998) (quoting First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995)). Under North Carolina law, " [a] valid contract requires [1] offer, [2] acceptance, [3] consideration and [4] no defenses to formation." Koltis v. North Carolina Dep't of Human Res., 125 N.C.App. 268, 271, 480 S.E.2d 702, 704 (1997) (citing Copy Prods., Inc. v. Randolph, 62 N.C.App. 553, 555, 303 S.E.2d 87, 88 (1983)). " North Carolina has a strong public policy favoring the settlement of disputes by arbitration. [Said] strong public policy requires that the courts resolve any doubts concerning the scope of arbitrable issues in favor of arbitration." Johnston Cnty. v. R.N. Rouse & Co., Inc., 331 N.C. 88, 91, 414 S.E.2d 30, 32 (1992). However, " North Carolina law requires the party seeking to compel arbitration to demonstrate that both parties mutually agreed to arbitrate their disputes." Minter, 2004 WL 735047, at *3 (citing Routh v. Snap-On Tools Corp., 108 N.C.App. 268, 271, 423 S.E.2d 791, 794 (1992)).

A. 2011 Arbitration Policy

Citi argues that Plaintiffs Adams, Whitfield, and Kraemer have " agreed to individually arbitrate any claims relating to [their] employment with [Citi]." (Docket

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Entry 30 at 2-3 (emphasis in original).)[4] Furthermore, Citi alleges that, " [a]s part of their arbitration agreements, . . . these Plaintiffs waived any right to commence or participate in any class or collective action arising from [their] employment." (Id. at 3.)

In January 2011, Citi promulgated an Employee Handbook (" 2011 Handbook" ) which included its Employment Arbitration Policy (" Arbitration Policy" ). (Id. at 4 (citing Docket Entry 29-2, ¶ 7; Docket Entry 29-3 at 2-6).) The Arbitration Policy states:

The Policy makes arbitration the required and exclusive forum for the resolution of all disputes (other than disputes which by statute are not arbitrable) arising out of or in any way related to employment based on legally protected rights (i.e., statutory, regulatory, contractual, or common-law rights) that may arise between an employee or former employee and Citi . . . including, ...

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