Bell v. Ryan Transportation Service, Inc.

176 F. Supp. 3d 1251, 2016 U.S. Dist. LEXIS 44026, 2016 WL 1298083
CourtDistrict Court, D. Kansas
DecidedMarch 31, 2016
DocketCase No. 15-9857-JWL
StatusPublished
Cited by6 cases

This text of 176 F. Supp. 3d 1251 (Bell v. Ryan Transportation Service, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bell v. Ryan Transportation Service, Inc., 176 F. Supp. 3d 1251, 2016 U.S. Dist. LEXIS 44026, 2016 WL 1298083 (D. Kan. 2016).

Opinion

MEMORANDUM & ORDER

John W. Lungstrum, United States District Judge

Plaintiff Jeff Bell filed this wage and hour suit individually and on behalf of all other similarly situated employees alleging violations of the overtime pay provisions of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq. Defendant Ryan Transportation Service, Inc. has moved to dismiss or stay the case and to compel arbitration on the grounds that plaintiffs complaint was filed in contravention of the terms of a valid and enforceable arbitration agreement executed by the parties that covers the claims asserted by plaintiff. [1254]*1254As a threshold matter, plaintiff contends that the court lacks jurisdiction-to compel arbitration because the Federal Arbitration Act exempts transportation workers from its provisions. In the alternative, plaintiff. contends that the court should strike as unenforceable certain discovery, attorney fee and confidentiality provisions in the agreement because those provisions prevent him from effectively vindicating his rights under the FLSA and that the court should strike as unenforceable the class action waiver and confidentiality provision as violative of the National Labor Relations Act. As will be explained, the court grants the motion to compel arbitration and stays the judicial proceedings in this case pending completion of the arbitration process.

Factual Background

Defendant Ryan Transportation Service, Inc. is a third-party logistics company specializing in transportation management and freight services. Defendant acts as an intermediary between shippers, who have freight that needs to be moved by truck, and trucking companies willing to haul freight. Defendant operates no trucks of its own and ships no freight of its own. Plaintiff Jeff Bell was employed by defendant from July 2013 until his resignation in January 2015. At the time he started his employment with defendant, plaintiff signed a “Mandatory Arbitration Agreement,” which' will be described in more detail below.

During his employment, plaintiff worked as a Carrier Sales Representative and as a Carrier Sales Team Lead. As a Carrier Sales Representative, plaintiffs duties involved locating a trucking company to transport-a specific load for a shipper and negotiating the price that would be paid to the trucking company for transporting that load. Plaintiff avers that he communicated closely with drivers while those drivers were transporting freight so that he could keep the shippers and those parties who were receiving freight advised about the progress of a delivery. Plaintiff -further avers that he also kept in close contact with drivers’ dispatchers to resolve any issues relating to potential delays in deliveries. According to plaintiff, he was responsible for monitoring the progress of drivers in his network to ensure timely and efficient delivery and for communicating any customer requirements to drivers to ensure compliance with those requirements. As a Carrier Sales Team Lead, plaintiffs duties included managing a team of Carrier Sales Representatives and performing the same duties as the Carrier Sales Representatives.

Standard and Applicable Law

Defendant’s motion is brought pursuant to Section 2 of the Federal Arbitration Act, described by the Supreme Court as the “primary substantive provision of the Act,” 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), which provides that:

[a] written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.

9 U.S.C. § 2. The Supreme Court has described Section 2 of the FAA as “reflecting both a ‘liberal federal policy favoring arbitration’ and the ‘fundamental principle that arbitration is a matter of contract.’ ” Nesbitt v. FCNH, Inc., 811 F.3d 371, 376 (10th Cir.2016) (quoting AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339, 131 S.Ct. 1740, 179 L.Ed.2d 742 (2011). “In line with these principles, courts must place arbitration agreements on an equal footing with other contracts, and enforce them accord[1255]*1255ing to their terms.” Id. (quoting Concepcion, 563 U.S. at 339, 131 S.Ct. 1740).

That said, the final phrase of Section 2, often referred to as the “saving clause,” “permits agreements to arbitrate to be invalidated by ‘generally applicable contract defenses, such as fraud, duress, or unconscionability/ but not by defenses that apply only to arbitration or that derive their meaning from the fact that an agreement to arbitrate is at issue.” Id. (quoting Concepcion, 563 U.S. at 339, 131 S.Ct. 1740) (further quotation omitted). Federal courts have also recognized what is referred to as the “effective vindication” exception to the FAA. Id. at 376-77 (quoting Am. Express Co. v. Italian Colors Rest., — U.S. -, 133 S.Ct. 2304, 2310, 186 L.Ed.2d 417 (2013)). This exception “originated as dictum in Mitsubishi Motors [Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985)], where [the Supreme Court] expressed a willingness to invalidate, on ‘public policy1 grounds, arbitration agreements that ‘operat[e] ... as a prospective waiver of a party’s right to pursue statutory remedies.’ ” Id. at 377 (quoting American Express Co., 133 S.Ct. at 2310 (further quotation omitted). The Tenth Circuit" recently applied this exception, noting the Supreme Court’s acknowledgement that the exception “would certainly cover a provision in an arbitration agreement forbidding the assertion of certain statutory rights,” and “would perhaps cover filing and administrative fees attached to. arbitration that are so high as to make access to the forum impracticable.” Id. (quoting American Express Co., 133 S.Ct. at 2310-11).

Transportation Worker Exemption

The threshold issue in this case involves not the FAA’s coverage provision found in Section 2 of the Act, but the FAA’s exemption clause found in Section 1. The FAA expressly provides that it does not apply to “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” 9 U.S.C. § 1. In Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001), the Supreme Court interpreted this provision as exempting contracts of employment of “transportation workers,” but not other employment contracts, from, the FAA’s coverage. Id. at 109, 121 S.Ct. 1302.

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Cite This Page — Counsel Stack

Bluebook (online)
176 F. Supp. 3d 1251, 2016 U.S. Dist. LEXIS 44026, 2016 WL 1298083, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bell-v-ryan-transportation-service-inc-ksd-2016.