Bates v. 84 Lumber Co.

205 F. App'x 317
CourtCourt of Appeals for the Sixth Circuit
DecidedSeptember 14, 2006
Docket04-6493, 05-5544, 05-5736
StatusUnpublished

This text of 205 F. App'x 317 (Bates v. 84 Lumber Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bates v. 84 Lumber Co., 205 F. App'x 317 (6th Cir. 2006).

Opinion

JULIA SMITH GIBBONS, Circuit Judge.

Thomas M. Bates (“Bates”) threatened to sue 84 Lumber Company (“84 Lumber” or “the Company”) after the Company terminated him in suspicious proximity to his exercise of his rights under the Family Medical Leave Act (“FMLA”). The Company responded with a preemptive suit for declaratory judgment in the United States District Court for the Eastern District of Kentucky, seeking a declaration that a limitations provision in the Company’s arbitration agreement time-barred any claim that Bates could bring against it. Bates filed his own suit in the same court, claiming that 84 Lumber violated the FMLA and various state laws by terminating him. The Company filed several motions. It filed a motion to dismiss, a motion to enjoin Bates’s suit, a motion to reconsider denial of its motion for a preliminary injunction, a motion to compel arbitration, a motion to stay Bates’s suit pending arbitration, and a motion to stay Bates’s suit pending its interlocutory appeal. Every motion relied on the limitations provision in the Company’s arbitration agreement. Bates filed a motion to dismiss. The district court initially consolidated the cases for briefing purposes and ultimately consolidated them for all purposes. The district court denied each motion and sanctioned 84 Lumber and later its counsel for the Company’s litigation strategy. The Company and its counsel took three separate appeals, which were consolidated before this court. We affirm the district court’s denial of the motion for preliminary injunction and conclude that we lack jurisdiction over the two remaining appeals.

I.

Bates accepted employment with 84 Lumber on or about November 1, 1999. He was hired as a part-time yard worker, but he was promoted to the position of Manager Trainee in July 2000. When Bates began working for 84 Lumber and when he received his promotion, he was not required to sign any documents related to his employment with 84 Lumber. Later, however, at an “84 University” training session mandated for all employees on May 8, 2001, 84 Lumber requested that Bates sign a number of documents. Among those documents was the 84 Lumber Dispute Resolution Program. Bates signed this document and inserted his social security number in the appropriate space. By doing so, Bates agreed to a “Time Limitation” on any legal claims related to his employment that he might bring against 84 Lumber. The “Time Limitation” provides:

To promote the timely resolution of disputes, the Associate agrees that he or she must initiate arbitration within six (6) months of the time the claim accrued or, in the alternative, when the Associate *319 became aware of it. 84 and Associates agree that failure to initiate arbitration within this six (6) month limitation period will constitute an absolute bar to the institution of any proceedings and a waiver of the claimed wrongful action. A written agreement between the parties to submit the dispute to mediation shall toll the time limitation period until fifteen (15) days after the date of which either Party gives written notice to the other Party that the mediation has concluded.

The “Time Limitation” later was invoked by 84 Lumber when Bates threatened to sue 84 Lumber for violating the FMLA and state laws prohibiting unfair employment practices. Bates claims that 84 Lumber wrongfully terminated him in October 2002. Bates had taken family medical leave from September 21, 2002 until October 8, 2002 because his father was suffering from a serious illness. Bates took this leave despite two alleged warnings from his supervisors that exercising his rights under the FMLA would result in his firing by 84 Lumber. After he returned from family medical leave, on November 12, 2002, Bates was indeed fired, following reassignment of his job responsibilities to a new employee and other allegedly improper conduct by 84 Lumber. More than six months after his termination and without initiating arbitration, Bates threatened to sue 84 Lumber. In a letter to Bates’s counsel, 84 Lumber invoked the “Time Limitation” on February 24, 2004 — according to Bates, more than nine months after he issued his threat to sue.

The Company then went to federal court to enforce the “Time Limitation” against Bates and prevent suit by him. On March 11, 2004, it sought declaratory and injunctive relief from the United States District Court for the Eastern District of Kentucky. The Company asked the court to “declare that Bates [could] not bring an action for wrongful termination because he did not assert such a claim through an arbitration proceeding within six months and pursuant to [the] Dispute Resolution Procedure.”

Bates ignored 84 Lumber’s preemptive strike and sued his former employer on March 28, 2004 — approximately sixteen months after 84 Lumber discharged him— in the Eastern District of Kentucky. He sought compensatory and punitive damages for alleged violations of the FMLA and state unfair wage and hour practices laws.

Because Bates filed his suit in the same court as 84 Lumber, 84 Lumber requested a status conference to determine how the separate cases would proceed in the same court. The district court granted the request. After holding the status conference, the district court consolidated Bates’s and 84 Lumber’s separate suits “for purposes of addressing the validity and enforceability of the limitations provision contained in the subject arbitration agreement.”

After the cases were consolidated, Bates moved to dismiss 84 Lumber’s action, arguing that the arbitration agreement and the limitations provision that it contained were unenforceable because they inhibited his substantive FMLA rights. 84 Lumber moved to dismiss, arguing that the arbitration agreement and the limitations provision were valid and enforceable because Bates voluntarily submitted to them and raised no objections to them during his employment with 84 Lumber.

The district court concluded that the limitations provision was not enforceable with respect to Bates’s FMLA claim because it would affect Bates’s substantive rights under the FMLA. It followed the only two reported decisions in the Sixth *320 Circuit dealing with contractual limitations on employees’s rights to sue under the FMLA. Lewis v. Harper Hospital, 241 F.Supp.2d 769, 772 (E.D.Mich.2002), held that a six-month limitation on the bringing of FMLA claims was invalid because it interfered with employees’ rights under the FMLA, and Henegar v. Daimler-Chrysler Corporation, 280 F.Supp.2d 680, 682 n. 1 (E.D.Mich.2003), followed Lewis. Because the district court held that the limitations provision was unenforceable, it denied 84 Lumber’s motion to dismiss. It also denied Bates’s motion to dismiss 84 Lumber’s action because numerous factual disputes prevented it from concluding that the arbitration agreement was invalid in toto or that the limitations provision was invalid with respect to Bates’s state law claims.

The Company moved the district court to reconsider its decision that the limitations provision was unenforceable with respect to Bates’s FMLA claims. It argued that the Lewis decision on which the district court relied to reach its decision contravened Sixth Circuit precedent. The district court denied 84 Lumber’s motion to reconsider after a hearing.

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205 F. App'x 317, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bates-v-84-lumber-co-ca6-2006.