HAHN v. THE REALREAL, INC.

CourtDistrict Court, D. New Jersey
DecidedSeptember 17, 2021
Docket2:18-cv-05030
StatusUnknown

This text of HAHN v. THE REALREAL, INC. (HAHN v. THE REALREAL, INC.) is published on Counsel Stack Legal Research, covering District Court, D. New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
HAHN v. THE REALREAL, INC., (D.N.J. 2021).

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY

CECILE HAHN, Plaintiff, Civ. No. 18-5030 v. OPINION THE REALREAL, INC.; JULIE WAINWRIGHT, Defendants

This matter comes before the Court on the motion (DE 70) of Defendants The RealReal, Inc. and Julie Wainwright (collectively, “Defendants”) to dismiss the Complaint and compel arbitration and Defendants’ motion (DE 71) for summary judgment. For the following reasons, both motions are DENIED. I. Background1 In 2011, Defendant Julie Wainwright founded The RealReal, a consignment business selling luxury items such as designer clothing, handbags, and jewelry. She serves as the company’s Chief Executive Officer and Chairwoman of the Board. (D SOMF ¶ 1.) Plaintiff Cecile Hahn was hired by The RealReal in July 2015 and subsequently became a Human Resources (“HR”) Manager at The RealReal’s Secaucus, New Jersey warehouse. (D SOMF ¶ 2.) Hahn was terminated approximately two years after being hired, when she was 47 years old. (D SOMF ¶ 2.) Asserting that her termination was the result

1 For ease of reference, certain key items from the record will be abbreviated as follows: “DE_” = Docket Entry in this Case “Compl.” = Complaint (DE 1, Ex. A) “D SOMF” = Defendants’ Statement of Material Facts (DE 71-2) “P SOMF” = Plaintiff’s Statement of Material Facts (DE 78-2) “Def. MTD Brf.” = Defendants’ Corrected Brief in Support of Motion to Dismiss (DE 76) “Def. SJ Brf.” = Defendants’ Brief in Support of Motion for Summary Judgment (DE 71-1) “Pl. MTD Brf.” = Plaintiff’s Brief in Opposition to Motion to Dismiss (DE 77) “Pl. SJ Brf.” = Plaintiff’s Brief in Opposition to Motion for Summary Judgment (DE 78) “Def. MTD Reply” = Defendants’ Reply Brief in Support of Motion to Dismiss (DE 84) “Def. SJ Reply” = Defendants’ Reply Brief in Support of Motion for Summary Judgment (DE 85) of age discrimination, Hahn brings this action under the New Jersey Law Against Discrimination against The RealReal and Wainwright. (P SOMF ¶ 33.) When Hahn was hired, she signed an offer letter containing a mandatory arbitration provision: Dispute Resolution through Individual Arbitration. Both you and the Company agree to arbitrate all disputes arising out of; or related to your employment with the Company, the termination thereof, or this or any other agreement between you and the Company. Without limiting the foregoing, this agreement to arbitrate disputes encompasses every claim regarding your employment with the Company, including any claims of unlawful discrimination, harassment or retaliation in employment, whether under federal, state or local law, except that you shall not be required to arbitrate any statutory claim that is not arbitrable according to the terms of the relevant statute, such as whistleblower claims under the Dodd- Frank Wall Street Reform and Consumer Protection Act. Such arbitration shall take place before JAMS in New York New York and shall be conducted pursuant to the then-current JAMS Rules for the Arbitration of Employment Disputes. The award of the arbitrators shall be final and judgment upon such award may be entered in any court of competent jurisdiction. Notwithstanding the foregoing, you agree that the Firm may seek injunctive or other provisional relief from any court of competent jurisdiction. You expressly acknowledge and agree that this agreement to arbitrate, on an individual basis, any such dispute between you and the Company precludes your participation, in any class action, collective action, or other representative action or proceeding. Consistent with the National Labor Relations Act, the Company will not retaliate against any employee joining a class or collective action, but may seek to enforce this agreement to arbitrate claims on an individual basis and dismiss any claims brought in violation of this agreement to arbitrate. This agreement does not prohibit you from pursuing an administrative claim with a local, state or federal administrative body such as the Equal Employment Opportunity Commission or the Workers' Compensation Board. This agreement does, however, preclude you from pursuing a court action regarding any such claim. (Patterson Aff. Exh. C.) Plaintiff filed this action in state court on February 18, 2018. Defendants then removed the case to this Court and filed an Answer, which did not raise arbitration as an affirmative defense. The parties exchanged initial disclosures, served and responded to discovery requests, and began depositions. Defendants took Hahn’s deposition in November of 2019, and four other depositions have taken place in this case. (DE 77-2 (“Castronovo Cert.”) at 7.) There have also been three case management conferences and four scheduling orders. On January 9, 2020, Defendants first sought leave from the Court to file a motion to compel arbitration. (DE 35). On January 31, 2020, Judge Hammer issued an Order denying Defendants’ motion to compel arbitration without prejudice to the filing of such motion together with a motion for summary judgment upon the completion of fact discovery. (DE 37.) Now before the Court are two motions filed by Defendants: (1) a motion to compel arbitration and dismiss the case; and (2) a motion for summary judgment. II. Motion to Compel Arbitration a. Legal Standard The Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., creates a strong federal policy in favor of arbitration. See Harris v. Green Tree Fin. Corp., 183 F.3d 173, 178–79 (3d Cir. 1999) (noting that FAA “creates a body of federal substantive law establishing and governing the duty to honor agreements to arbitrate disputes.”). The Act authorizes a party to enforce a valid arbitration agreement by moving to compel arbitration. 9 U.S.C. §§ 2-4; In re Pharmacy Benefit Managers Antitrust Litig., 700 F.3d 109, 116 (3d Cir. 2012). Arbitration is a matter of contract between parties, so a judicial mandate to arbitrate must be predicated on the parties’ consent. Guidotti v. Legal Helpers Debt Resolution, L.L.C., 716 F.3d 764, 771 (3d Cir. 2013) (quoting Par- Knit Mills, Inc. v. Stockbridge Fabrics Co., Ltd., 636 F.2d 51, 54 (3d Cir. 1980)). When a district court is presented with a motion to compel arbitration, the Court must (a) determine whether the agreement to arbitrate is valid, and then (b) decide whether the dispute falls within the agreement’s scope. Century Indem. Co. v. Certain Underwriters at Lloyd’s, 584 F.3d 513, 523 (3d Cir. 2009). “[W]hen it is clear on the face of the complaint [or documents relied upon by the complaint] that a validly formed and enforceable arbitration agreement exists and a party's claim is subject to that agreement, a district court must compel arbitration under a Rule 12(b)(6) pleading standard . . . .” MZM Constr. Co. v. N.J. Bldg. Laborers Statewide Benefit Funds, 974 F.3d 386, 406 (3d Cir. 2020). But if (1) the materials subject to review on a Rule 12(b)(6) motion are unclear as to the arbitrability question, or (2) the parties have come forward with facts putting the arbitrability question at issue, then the court may order limited discovery and then consider the arbitrability question on a summary judgment standard. Guidotti v. Legal Helpers Debt Resol., LLC, 716 F.3d 764, 774 (3d Cir. 2013) (quotation marks and citation omitted). b. Waiver Defendants argue that the Complaint should be dismissed because the dispute is subject to arbitration pursuant to an agreement signed by Hahn when she was hired in 2015. Hahn responds that Defendants have waived arbitration by litigating this matter in court for two years before seeking to move to compel arbitration.

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HAHN v. THE REALREAL, INC., Counsel Stack Legal Research, https://law.counselstack.com/opinion/hahn-v-the-realreal-inc-njd-2021.