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Shockley v. PrimeLending

United States Court of Appeals, Eighth Circuit

July 15, 2019

Jennifer Shockley, individually, and on behalf of all other similarly situated persons Plaintiff - Appellee
v.
PrimeLending, a PlainsCapital Company Defendant-Appellant

          Submitted: February 12, 2019

          Appeal from United States District Court for the Western District of Missouri - Kansas City

          Before SMITH, Chief Judge, BENTON and STRAS, Circuit Judges.

          SMITH, CHIEF JUDGE

         PrimeLending, a PlainsCapital Company, appeals from the district court's[1]denial of its motion to compel arbitration against Jennifer Shockley. Shockley sued PrimeLending, alleging a violation of the Fair Labor Standards Act (FLSA). The district court denied the motion to compel arbitration because there was no agreement to arbitrate between Shockley and PrimeLending. The district court held that the arbitration provision contained in the PrimeLending Handbook Addendum ("Handbook"), and the delegation provision therein, were not enforceable contracts. We agree with the district court that Shockley and PrimeLending never entered into a contract relating to either provision. Therefore, we affirm the denial of PrimeLending's motion to compel arbitration.

         I. Background

         Shockley[2] was employed by PrimeLending from June 2016 to July 2017. PrimeLending maintained a computer network accessible by its employees, which contained employment-related information, such as its new hire policies and Handbook. In August 2016, Shockley accessed this section of PrimeLending's network by using a computer mouse to click and open various company documents, including the Handbook. Clicking on the Handbook in the system automatically generated an acknowledgment of review. That same click would have generated a pop-up window containing a hyperlink to open the full text of the Handbook. Shockley does not recall reviewing the Handbook, and there is no evidence that she ever opened or reviewed the Handbook's full text. As part of her required annual policy review, Shockley completed the same process in the computer network again in February 2017.

         The Handbook contains two important provisions relevant to this case: the "Dispute Resolution/Arbitration Clause" ("arbitration provision") and the "Control of Decisions" provision ("delegation provision"), which is a subpart within the arbitration provision. The arbitration provision specifically includes FLSA disputes as subject to arbitration. In pertinent part, the arbitration provision states:

If the dispute cannot be settled through negotiation, you and the Company agree to attempt in good faith to resolve the covered dispute exclusively through final and binding arbitration in accordance with the terms, conditions and procedures of this Arbitration Clause.
For all Covered Disputes, both you and the Company waive their right to trial by jury or before a judge in a court of law, including the right to initiate a class, collective, representative or private attorney general action. All Covered Disputes will be settled by binding arbitration, on an individual basis, pursuant to the Federal Arbitration Act as administered by JAMS, a third party alternative dispute resolution provider.

Def.'s Reply Suggestion in Support of Its Mot. to Compel Individual Arbitration, Ex. B, at 10, Shockley v. PrimeLending, No. 4:17-cv-00763 (W.D. Mo., Dec. 11, 2017), ECF No. 18-1.

         The delegation provision in full reads:

The Arbitrator, and not any federal, state, or local court or agency, shall have exclusive authority to resolve any claim relating to the interpretation, applicability, enforceability or formation of this Clause including, but not limited to, any ...

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