Wallace v. Red Bull Distributing Co.

958 F. Supp. 2d 811, 2013 WL 3823130, 2013 U.S. Dist. LEXIS 102989
CourtDistrict Court, N.D. Ohio
DecidedJuly 23, 2013
DocketCase No. 5:12-CV-02431
StatusPublished
Cited by5 cases

This text of 958 F. Supp. 2d 811 (Wallace v. Red Bull Distributing Co.) is published on Counsel Stack Legal Research, covering District Court, N.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wallace v. Red Bull Distributing Co., 958 F. Supp. 2d 811, 2013 WL 3823130, 2013 U.S. Dist. LEXIS 102989 (N.D. Ohio 2013).

Opinion

MEMORANDUM OPINION AND ORDER

SARA LIOI, District Judge.

This matter is before the Court upon the motion (Doc No. 10) of defendants Red Bull Distribution Company (“RBDC”)1 and Jeff Barta (“Barta”) to dismiss the action or, alternatively, to stay the proceedings, and to compel arbitration. Plaintiff Jeffrey J. Wallace (“Wallace” or “plaintiff’) has filed an opposition (Doc. No. 11), and defendants have submitted a brief in reply (Doc. No. 12). The matter is ripe for determination. For the following reasons, defendants’ motion to dismiss and compel arbitration is GRANTED.2

I. FACTUAL AND PROCEDURAL BACKGROUND

RBDC is a Sacramento, California-based subsidiary of RedBull GmbH and an affiliate of Red Bull North America, Inc. (“RBNA”). RBDC is the largest distributor in North America of Red Bull products, including Red Bull Energy Drink. (Hernandez Decl. I, Doc. No. 10-2 at ¶ 2.) On January 6, 2011, Wallace met with RBDC representatives in Cleveland, Ohio as part of RBDC’s hiring process in connection with the launching of new facilities in Ohio and Michigan. (Hernandez Decl. II, Doc. No. 13, at ¶ 3.) At the meeting, Wallace first completed RBDC’s Application for Employment (the “Application”). (Doc. No. 13-2). As a condition of his employment, Wallace signed an agreement with RBDC attached to the Application entitled “Mutual Agreement for Employment At-Will and Mediation/Arbitration in California” (the “RBDC Agreement”) (Doc. No. 13-2 at 125), which contained various mediation and arbitration provisions. (Doc. No. 10-2 at ¶ 5; Doc. No. 11-1 at ¶¶ 2-3; Doc. No. 13 at ¶ 6.)

After submitting the Application, Wallace was immediately interviewed by RBDC representatives. (Doc. No. 13 at ¶ 8.) After further consideration of Wallace’s candidacy, RBDC extended Wallace a written offer of employment for the position of District Sales Manager, Columbus, Ohio. (Doc. No. 13 at ¶ 8; Doc. No. 13-4.) When Wallace indicated his desire to accept the offered position, he was given additional new hire paperwork, most of which Wallace signed that same day, including an agreement with RBNA entitled “Mutual Arbitration Agreement” (the “RBNA Agreement”). The RBNA Agreement also contained mediation and arbitration provisions, some of which differed from those of the RBDC agreement. (Doc. No. 10-2 at ¶ 6; Doc. No. 13 at ¶ 9; Doc. No. 11-1 at ¶ 2.) Wallace’s offer letter made his employment explicitly subject to the execution of various documents, including the RBNA Agreement. (Doc. No. 13-4 at 140.) Wallace was also given RBDC’s Employee Handbook, which provided that “[t]he specifics of the arbitration policy are set forth in the Mutual Agreement to Arbitrate that you signed when you were hired,” referring to the RBNA Agreement. (Doc. No. 11-2 at 96; Doc. No. 13 at ¶ 12.)

Wallace began work at RBDC on January 9, 2011. (Doc. No. 1 at ¶ 5.) On No[816]*816vember 22, 2011, defendant Barta, an RBDC Branch Manager, informed Wallace that his employment had been terminated. (Doc. No. 1 at ¶ 7.) On September 27, 2012, Wallace filed suit against defendants, alleging racial discrimination under federal law against RBDC and racial discrimination and defamation under Ohio law against both defendants. (Doc. No. 1.) Defendants brought the subject motion seeking to dismiss or stay the case and compel arbitration.

II. LEGAL STANDARD

The standard for ruling on defendants’ motion is dictated by the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1, et seq., which provides that “[a] party aggrieved by the alleged failure, neglect, or refusal of another to arbitrate under a written agreement for arbitration may petition” for an order compelling arbitration. 9 U.S.C. § 4. “[U]pon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement,” a court “shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement. ...” Id. § 3.

The FAA manifests “a liberal federal policy favoring arbitration agreements.” 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); see 9 U.S.C. §§ 1-16; see also Shearson/Am. Express, Inc. v. McMahon, 482 U.S. 220, 226, 107 S.Ct. 2332, 96 L.Ed.2d 185 (1987); Stachurski v. DirecTV, Inc., 642 F.Supp.2d 758, 764 (N.D.Ohio 2009). “To enforce this dictate, [the FAA] provides for a stay of proceedings when an issue is referable to arbitration and for orders compelling arbitration when one party has failed or refused to comply with an arbitration agreement.” Javitch v. First Union Sec., Inc., 315 F.3d 619, 624 (6th Cir.2003) (citing 9 U.S.C. §§ 3-4). In cases where all claims are referred to arbitration, however, the litigation may be dismissed rather than merely stayed. See Hensel v. Cargill, Inc., No. 99-3199, 198 F.3d 245 (table), at *4 (6th Cir. Oct. 19, 1999); see also Alford v. Dean Witter Reynolds Inc., 975 F.2d 1161, 1164 (5th Cir.1992) (holding that dismissal is proper where all claims must be submitted to arbitration); Sparling v. Hoffman Const. Co., Inc., 864 F.2d 635, 638 (9th Cir.1988) (holding that 9 U.S.C. § 3 does not preclude dismissal).

If the validity of an arbitration agreement is “in issue,” the court must hold a trial to resolve the question. Id. § 4. “In order to show that the validity of the agreement is ‘in issue,’ the party opposing arbitration must show a genuine issue of material fact as to the validity of the agreement to arbitrate.” Great Earth Cos. v. Simons, 288 F.3d 878, 889 (6th Cir.2002). “The required showing mirrors that required to withstand summary judgment in a civil suit.” Id. A district court, therefore, must view all facts and inferences in the light most favorable to the party opposing arbitration and determine “whether the evidence presented is such that a reasonable finder of fact could conclude that no valid agreement to arbitrate exists.” Id.

The Sixth Circuit applies a four-pronged test to evaluate a motion to dismiss or stay the proceedings and compel arbitration:

(1) The Court must determine whether the parties agreed to arbitrate;
(2) The Court must determine the scope of the agreement;

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Bluebook (online)
958 F. Supp. 2d 811, 2013 WL 3823130, 2013 U.S. Dist. LEXIS 102989, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wallace-v-red-bull-distributing-co-ohnd-2013.