Wells Fargo Advisors, L.L.C. v. Tucker

195 F. Supp. 3d 543, 2016 U.S. Dist. LEXIS 86623, 2016 WL 3670577
CourtDistrict Court, S.D. New York
DecidedJuly 1, 2016
Docket15-CV-7722 VEC
StatusPublished
Cited by6 cases

This text of 195 F. Supp. 3d 543 (Wells Fargo Advisors, L.L.C. v. Tucker) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wells Fargo Advisors, L.L.C. v. Tucker, 195 F. Supp. 3d 543, 2016 U.S. Dist. LEXIS 86623, 2016 WL 3670577 (S.D.N.Y. 2016).

Opinion

OPINION & ORDER

VALERIE CAPRONI, United States-District Judge:

Respondents Reagan Tucker (“Tucker”), Benjamin Dooley (“Dooley”) and Marvin Glasgold (“Glasgold”) (collectively the “Respondents”) commenced an arbitration proceeding before the American Arbitration Association (“AAA”) against their former employer, Wells Fargo Advisors, L.L.C. (“Wells Fargo”), raising class-wide and collective claims for unpaid overtime. In response, pursuant to the Federal Arbitration Act, 9 U.S.C.A. § 1 et seq. (“FAA”), Wells Fargo filed a Petition to Dismiss or in the Alternative Stay the Pending Arbitration and Compel Individual Arbitration in Accordance With the Binding Arbitration Agreements (“Petition”). For the following reasons, Wells Fargo’s Petition is DENIED.

BACKGROUND

I. Respondents’ Arbitration Action

Respondents are former Wells Fargo financial advisors who were employed at Wells Fargo branch offices in New York and Texas between July 2011 and August 2013. Petition ¶¶ 10-12. In connection with their employment, each Respondent signed a “New Financial Advisor Training Agreement” (the “Agreement”), pursuant to which each agreed to arbitrate “any controversy or dispute” with Wells Fargo. See Declaration of Kenneth J. Turnbull in Support of Petition (“Turnbull Deck”), Exs. AC.

Paragraph 14 of the Agreement provides in pertinent part:

you agree that any controversy or dispute, including but not limited to, claims of wrongful termination, breach of contract, discrimination, harassment, retaliation, infliction of emotional distress, tortious interference with business or contract, federal, state or local statute or ordinance and/or other theory, arising between you and Wells Fargo Advisors, shall be submitted for arbitration before FINRA. If the FINRA does not accept the controversy, dispute or claim, or any portion thereof, then the nonaccepted controversy, dispute or claim shall be submitted for arbitration before the American Arbitration Association pursuant to its Securities Arbitration Rules, effective May 1,1993.

On July 23, 2015, Respondents initiated identical putative class actions with the Financial Industry Regulatory Authority (“FINRA”) and the AAA, asserting, inter alia, claims for unpaid overtime under the Fair Labor Standards Act (“FLSA”) and the New York Labor Law (“NYLL”). See [546]*546Turnbull Decl., Exs. D, E. In their statement of claim before the AAA, Respondents allege that Wells Fargo misclassified them as exempt employees under the FLSA and NYLL and failed to pay them overtime for hours, worked in excess of 40 hours per week. Trumbull Decl., Ex. E ¶¶ 3-4. Respondents seek to arbitrate their claims on a class-wide basis representing, first, a class of similarly-situated financial adviser “Trainees,” id. ¶ 1-2, and second, a class of similarly-situated “Apprentice Phase” financial advisers, id.

Because Rule 13204 of the FINRA Code of Arbitration Procedure for Industry Disputes prohibits class action claims from being arbitrated by FINRA, see Memorandum in Support of the Petition to Dismiss or in the Alternative Stay the Pending Arbitration and Compel Individual Arbitration in Accordance With the Binding Arbitration Agreements (“Mem.”) at 4; see also Cohen v. UBS Fin. Servs., Inc., 799 F.3d 174, 178 (2d Cir.2015), Respondents’ claims are now pending arbitration before the AAA.

DISCUSSION

I. Legal Standard

The Federal Arbitration Act “is an expression of a ‘strong federal policy favoring arbitration as an alternative means of dispute resolution.’ ” Ross v. Am. Express Co., 547 F.3d 137, 142 (2d Cir.2008) (quoting Hartford Accident & Indent, Co. v. Swiss Reinsurance Am. Corp., 246 F.3d 219, 226 (2d Cir.2001)). As a result “any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration,” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983), and courts should “construe arbitration clauses as broadly as possible,” David L. Threlkeld & Co. v. Metallgesellschaft Ltd., 923 F.2d 245, 250 (2d Cir.), cert. dismissed, 501 U.S. 1267, 112 S.Ct. 17, 115 L.Ed.2d 1094 (1991) (citation omitted). “Of course, notwithstanding the policy favoring arbitration, ‘arbitration is a matter of contract and a party cannot 'be required to submit to arbitration any dispute which he has not agreed so to submit.’” Klein v. ATP Flight Sch., LLP, No. 14-CV-1522(JFB)(GRB), 2014 WL 3013294, at *4 (E.D.N.Y. July 3, 2014) (quoting AT & T Techs., Inc. v. Commc’ns Workers of Am., 475 U.S. 643, 648, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986)); see also Cap Gemini Ernst & Young, U.S., L.L.C. v. Nackel, 346 F.3d 360, 364 (2d Cir.2003) (Congress enacted the FAA “to make arbitration agreements as enforceable as other contracts, but not more so.” (quoting Opals on Ice Lingerie v. Bodylines Inc., 320 F.3d 362, 369 (2d Cir.2003) (emphasis in original)).

“[Disputes about ‘arbitrability’.... such as ‘whether the parties are bound by a given arbitration clause,’ or ‘whether an arbitration clause in a con-cededly binding contract applies to a particular type of controversy’ ” are presumptively “gateway” issues for the court to decide. BG Grp., PLC v. Republic of Argentina, — U.S. —, 134 S.Ct. 1198, 1206, 188 L.Ed.2d 220 (2014) (quoting Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79, 84, 123 S.Ct. 588, 154 L.Ed.2d 491 (2002)). The Supreme Court has clarified, however, that such “gateway” questions arise only in:

narrow circumstance where contracting parties would likely have expected a court to have decided the gateway matter, where they are not likely to have thought that they had agreed that an arbitrator would do so, and, consequently, where reference of the gateway dispute to the court avoids the risk of forcing parties to arbitrate a matter that they may well not have agreed to arbitrate.

Howsam, 537 U.S. at 83-84, 123 S.Ct. 588. Furthermore, the “presumption [that gate[547]*547■way questions will be decided by courts] may be overcome if the parties have ‘clearly and unmistakably’ delegated to an arbitration] the authority to resolve issues of arbitrability.” Klein, 2014 WL 3013294, at *4 (quoting Howsam, 537 U.S. at 83, 123 S.Ct. 588).

As to the scope of an arbitration agreement, the court’s determination generally “depends on whether the agreement is a broad agreement or a narrow one.” Edwards v. Macy’s Inc., No. 14CV-8616(CM)(JLC), 2015 WL 4104718, at *10 (S.D.N.Y. June 30, 2015) (citing Mehler v. Terminix Int'l Co., 205 F.3d 44, 49 (2d Cir.2000)).

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Bluebook (online)
195 F. Supp. 3d 543, 2016 U.S. Dist. LEXIS 86623, 2016 WL 3670577, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wells-fargo-advisors-llc-v-tucker-nysd-2016.