United States District Court, W.D. North Carolina, Charlotte Division
LEILONNI DAVIS, ASHLEY SAFRIT, and LAUREN WILSON, on behalf of themselves and all others similarly situated, Plaintiffs,
TMC RESTAURANT OF CHARLOTTE, LLC d/b/a THE MEN’S CLUB, Defendant.
J. CONRAD, JR. UNITED STATES DISTRICT JUDGE
MATTER is before the Court on Defendant’s
Motion to Dismiss or Stay in Favor of Arbitration, (Doc. No.
11); the Magistrate Judge’s Memorandum and
Recommendation (“M&R”), (Doc. No. 20);
Defendant’s Objections, (Doc. No. 21); and
Plaintiffs’ Response to Defendant’s Objections,
(Doc. No. 24).
Leilonni Davis (“Davis”), Ashley Safrit
(“Safrit”), and Lauren Wilson
(“Wilson” and collectively with Davis and Safrit,
“Plaintiffs”) are former servers or bartenders at
Defendant TMC Restaurant of Charlotte, LLC d/b/a The
Men’s Club (“Defendant”). (Doc. No. 11-3,
at ¶¶ 4–6.) Plaintiffs filed this putative
class action against Defendant alleging violations of the
Fair Labor Standards Act, the North Carolina Wage and Hour
Act, and 26 U.S.C. § 7434. (Doc. No. 1, at 12–13.)
Defendant answered by filing the instant Motion to Dismiss or
Stay in Favor of Arbitration contending that Plaintiffs
entered into an Arbitration Agreement and Waiver of
Class/Collective Actions (“Arbitration
Agreement”) with Defendant that requires
Plaintiffs’ claims to be resolved through arbitration.
(Doc. No. 11, ¶ 4.)
conceded that Safrit and Wilson entered into the Arbitration
Agreement with Defendant and, accordingly, the Magistrate
Judge recommended that their claims be stayed pending
arbitration. (Doc. No. 16, at 1; Doc. No. 20: M&R, at 4.)
However, the Magistrate Judge found that Davis did not enter
into the Arbitration Agreement with Defendant and recommended
that Defendant’s motion be denied as to Davis’s
claims. (M&R, at 7–8.)
STANDARD OF REVIEW
district court may assign dispositive pretrial matters to a
magistrate judge for “proposed findings of fact and
recommendations.” 28 U.S.C. § 636(b)(1)(B). The
Federal Magistrate Act provides that a district court
“shall make a de novo determination of those portions
of the report or specific proposed findings or
recommendations to which objection is made.”
Id. at § 636(b)(1); Camby v. Davis,
718 F.2d 198, 199 (4th Cir. 1983).
objects to the M&R on three grounds. First, Defendant
contends that the arbitrator must decide whether an
arbitration agreement between Davis and Defendant exists
because they validly delegated this issue to the arbitrator.
(Doc. No. 21, at 1–2.) Second, Defendant contends that
it established that Davis agreed to arbitrate her claims
against Defendant. (Doc. No. 21, at 2.) Third and last,
Defendant contends that if the Court finds that Defendant has
not proven that Davis agreed to arbitrate her claims,
Defendant is entitled to a jury trial on the issue of whether
an agreement to arbitrate exists. (Doc. No. 21, at 2.)
Framework Under the FAA
parties agree that the Federal Arbitration Act
(“FAA”) applies to the Arbitration Agreement.
“The [FAA] provides that any written provision to
resolve by arbitration a controversy arising pursuant to a
contract involving commerce ‘shall be valid,
irrevocable, and enforceable, save upon such grounds as exist
at law or in equity for the revocation of any
contract.’” Klopfer v. Queens Gap Mt.,
LLC, 816 F.Supp.2d 281, 286 (W.D. N.C. 2011) (quoting 9
U.S.C. § 2). “Under § 4, a party aggrieved by
the failure of another party to arbitrate under a written
agreement for arbitration may petition a federal court for an
order directing that such arbitration proceed in the manner
provided for in such agreement.” Rent-A-Center, W.,
Inc. v. Jackson, 561 U.S. 63, 68 (2010) (quotation marks
considering a motion to compel arbitration, the court must
first determine whether the court or the arbitrator decides
issues of arbitrability-that is, whether an agreement to
arbitrate exists between the parties and whether the specific
dispute falls within the scope of that agreement. Peabody
Holding Co., LLC v. United Mine Workers of Am., Int’l
Union, 665 F.3d 96, 101 (4th Cir. 2012). Courts presume
that the parties intended for the court, not the arbitrator,
to decide issues of arbitrability. Rock-Tenn Co. v.
United Paperworkers Int’l Union, 184 F.3d 330, 335
(4th Cir. 1999). This presumption can be rebutted, however,
by clear and unmistakable evidence that the parties agreed
that the arbitrator would determine arbitrability. First
Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944
(1995). Such an agreement to arbitrate arbitrability is often
referred to as a “delegation provision.” See
Rent-A-Center, 561 U.S. 63.
court concludes that the court is to decide arbitrability
issues, then the court must first determine whether an
agreement to arbitrate exists between the parties.
Hightower v. GMRI, Inc., 272 F.3d 239, 242 (4th Cir.
2001). If the court finds that such an agreement exists, then
the court must next determine whether the specific dispute
falls within the scope of the arbitration agreement.
Id. “A court may compel arbitration of a
particular dispute only when the parties have agreed to
arbitrate their disputes and the scope of the parties’
agreement permits resolution of the dispute at issue.”
Muriithi v. Shuttle Express, Inc., 712 F.3d 173, 179
(4th Cir. 2013). In so deciding, the court is to apply the
standard applicable to a motion for summary
judgment-“the Court should compel arbitration [only]
‘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.’” Adams v.
Citicorp Credit Servs., 93 F.Supp.3d 441, 445 (M.D. N.C.
2015) (quoting Fed.R.Civ.P. 56(a)).
The Court Must Decide Whether an Arbitration ...