United States District Court, E.D. Arkansas, Western Division
ROY WILSON, UNITED STATES DISTRICT JUDGE.
is Defendants' Motion to Dismiss and Compel Arbitration
(Doc. No. 38). Plaintiffs have responded and Defendants have
replied. For the reasons set out below, the Motion
is GRANTED IN PART and DENIED IN PART.
filed a qui tam action under the False Claims Act
against Defendants on July 8, 2015. Plaintiff Kelly
Shackleford, who was employed by Defendants, also asserted
claims under the Fair Labor Standards Act and Arkansas
Minimum Wage Act, for wrongful termination, and for
violations of COBRA.
December 28, 2017 letter, I asked, “Assume I find that
the arbitration agreement is enforceable against Ms.
Shackleford. Why would requiring Ms. Shackleford to proceed
with arbitration affect Ms. Mills's ability to proceed in
this case?” In a joint response, the parties informed
me that Counts I-III of the complaint had been settled. Since
Plaintiff Karen Mills was named only in these counts, she was
no longer involved in the case. Accordingly, based on this
correspondence, Counts I-III are DISMISSED with prejudice
based on the terms of the settlement agreement and Ms. Karen
Mills is DISMISSED.
IV-VIII involve only Plaintiff Kelly Shackleford and all are
based on her employment with Defendants. However, on August
31, 2010, Plaintiff Shackleford signed an Arbitration
Agreement which, among other things, set out that she
“underst[ood] that by signing this Arbitration
Agreement, the parties waive their right to trial by court or
jury.” The Arbitration Agreement covers the
claims alleged in Counts IV-VIII of the Complaint.
Shackleford asserts that the Arbitration Agreement “is
a stand-alone agreement that is not valid or enforceable
because (1) it lacks mutuality of obligations, and (2) it is
not supported by adequate consideration.” However, both
parties agreed to arbitrate certain claims and agreed to
exclude certain claims from arbitration (assuming without
deciding that mutuality of obligation is even required under
the Federal Arbitration Act). Additionally, Plaintiff's
acceptance of the arbitration agreement terms “supplied
consideration for [her] employment.”These same
arguments have been rejected in cases involving similar
arbitration agreements between employer and employees under
the Federal Arbitration Act (I am not a warm friend of the
FAA, but it has been approved by the courts).
on the findings of fact and conclusions of law above,
Defendant's Motion to Dismiss and Compel Arbitration
(Doc. No. 38) is GRANTED IN PART and DENIED IN PART. The
parties must proceed with arbitration, as set out in the
Clerk of the Court is directed to ADMINISTRATIVELY TERMINATE
this case, without prejudice to the right of the parties to
reopen the case for good cause. However, this case will not
be reopened unless an application to reopen is filed by one
of the parties within 30 days of the final disposition of the
arbitration proceeding. If no motion is filed, this Order
will be considered a dismissal with prejudice, without
further order of the Court.
out above, Counts I-III are DISMISSED with prejudice based on
the terms of the settlement agreement and Ms. Karen Mills is
DISMISSED. This Court specifically retains ...