Mantooth v. Bavaria Inn Restaurant, Inc.

360 F. Supp. 3d 1164
CourtDistrict Court, D. Colorado
DecidedJanuary 28, 2019
DocketCivil Action No. 17-cv-1150-WJM-MEH
StatusPublished
Cited by13 cases

This text of 360 F. Supp. 3d 1164 (Mantooth v. Bavaria Inn Restaurant, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mantooth v. Bavaria Inn Restaurant, Inc., 360 F. Supp. 3d 1164 (D. Colo. 2019).

Opinion

William J. Martínez, United States District Judge

The underlying claims in this lawsuit concern whether a local landmark establishment, Defendant Bavaria Inn Restaurant Inc. d/b/a/ Shotgun Willie's ("Shotgun Willie's"), and its owner Defendant Debra Matthews (jointly, "Defendants") improperly classified named Plaintiffs Chada Mantooth, Gale Raffaele, Alexis Nagle, Nicole Bujok ("named Plaintiffs"), in addition to opt-in plaintiffs (jointly, "Plaintiffs") as independent contractors and underpaid Plaintiffs in violation of the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq. ("FLSA"), the Colorado Wage Claim Act, Colo. Rev. Stat. §§ 8-4-101 et seq. ("CWCA"), and Colorado common law. (ECF No. 1.)

Defendants moved to compel arbitration. The Court previously granted in part Defendants' motion to compel arbitration (the "Order"). (ECF No. 124.) The Court compelled arbitration but struck certain fee-shifting and arbitrator selection clauses in the parties' arbitration agreements, as well as the cost-shifting clause of the agreements for Bujok, Nagle, Raffaele, and opt-in plaintiff Alexandra Darr. (Id. at 23-24.)

The parties were not wholly satisfied with the Court's resolution of Defendants' motion to compel. Defendants filed a "Motion for Partial Reconsideration" ("Reconsideration Motion") asking the Court to *1167revisit its decision to sever provisions under the effective vindication doctrine based on the Supreme Court's decision in Epic Systems Corporation v. Lewis , --- U.S. ----, 138 S.Ct. 1612, 1619, 200 L.Ed.2d 889 (2018). (ECF No. 125.) Plaintiffs filed a version of a motion for reconsideration titled "Motion for Partial Relief from Order Granting In Part Defendants' Motion to Compel Arbitration" ("Relief Motion") asking the Court to strike the cost-shifting provisions in the arbitration contracts of Mantooth and the remaining opt-in plaintiffs. (ECF No. 127.) Defendants then filed a motion to strike certain exhibits attached to Plaintiffs' reply in support of the Relief Motion or, in the alternative, to allow a sur-reply ("Motion to Strike"). (ECF No. 142.)

For the reasons explained below, the Court grants in part Defendants' Reconsideration Motion; grants in part Defendants' Motion to Strike; and grants in part Plaintiffs' Relief Motion in the interest of justice.

I. BACKGROUND & PROCEDURAL HISTORY

The underlying factual basis for these motions is discussed in the Order. Familiarity with that factual background is presumed.

In relevant summary, named Plaintiffs and opt-in plaintiffs Darr and Jessica Lopez signed "Entertainment License Agreements" to work at Shotgun Willie's. These agreements contained an arbitration provision.1 (ECF No. 57-2 ¶ 22.) That provision delegated exclusive authority to resolve disputes over the validity or enforceability of the agreement to the arbitrator; allowed Defendants to insist on an arbitrator "experienced in the adult entertainment industry"; and contained four provisions concerning arbitration fees and costs:

• "The costs of the arbitration shall be borne equally by the entertainer and the club unless the arbitrator concludes that a different allocation is required by law." (Id. ¶ 22.A.)
• "In the event that any party challenges, or is required to initiate proceedings to enforce, the arbitration requirements of this paragraph 22, the prevailing party to such challenges and/or enforcement proceedings shall be entitled to an award of all costs, including actual and reasonable attorney fees, incurred in litigation such issues." (Id. ¶ 22.D.)
• "Any ruling arising out of a claim between the parties shall, to the extent not precluded by applicable law, award costs incurred for the proceedings and reasonable attorney fees to the prevailing party." (Id. ¶ 22.E.)
• The arbitrator "shall be permitted to award, subject only to the restrictions contained in this paragraph 22, any relief available in a court." (Id. ¶ 22.A.)

On October 16, 2017, Defendants moved to compel "Plaintiffs"-defined as "named Plaintiffs, Alexandra Darr and Jessica Lopez"-to arbitrate their claims.2 (ECF No. 57 at 2 n.2.) In response, "Plaintiffs"-defined as "Named and Opt-in Plaintiffs, *1168and putative class/collective action members"-objected to the motion to compel in part because the fee- and cost-shifting provisions of their arbitration agreements prevented "Plaintiffs" from effectively vindicating their claims. (ECF No. 86 at 1 n.1, 11.) In support, these Plaintiffs submitted evidence from Bujok, Darr, Nagle, and Raffaele about their ability to share arbitration costs, as well as the financial hardship the cost-sharing provision would impose. (ECF Nos. 86-5, 86-6, 86-8 & 86-9.)

In its Order, the Court granted in part the motion to compel. (ECF No. 124.) The Court also found that, for Bujok, Darr, Nagle, and Raffaele, arbitration costs would be thousands to tens of thousands of dollars; "the cost-sharing provisions of the arbitration clause would prevent effective vindication of their claims"; and thus the Court severed the cost-sharing provisions for those individuals. (Id. at 16-17.) The Court did not, however, sever the cost-sharing provisions for Mantooth or Lopez because they did not submit evidence of financial hardship. The Court also severed certain fee-shifting provisions and the arbitrator selection clause-a provision that would have allowed Defendants to demand an arbitrator "experienced in the adult entertainment industry"-for named Plaintiffs, Darr, and Lopez because in the Court's view such clauses would have prevented effective vindication of Plaintiffs' rights. (Id. at 14, 19-20.)

Five days after the Court's Order, the Supreme Court issued its opinion in Epic Systems Corporation v. Lewis , resolving the question of whether "employees and employers [should] be allowed to agree that any disputes between them will be resolved through one-on-one arbitration." --- U.S. ----, 138 S.Ct. 1612, 1619, 200 L.Ed.2d 889 (2018). The Supreme Court held that the National Labor Relations Act, which "secures to employees rights to organize unions and bargain collectively," did not "manifest[ ] a clear intention to displace the Arbitration Act." Id.

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Bluebook (online)
360 F. Supp. 3d 1164, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mantooth-v-bavaria-inn-restaurant-inc-cod-2019.