United States District Court, E.D. Missouri, Eastern Division
MEMORANDUM AND ORDER
L. WHITE UNITED STATES DISTRICT JUDGE.
matter is before the Court on Defendants' Motion to
Compel Arbitration and Stay Proceedings (ECF No. 9). The
motion is fully briefed and ready for disposition.
filed a lawsuit in the Circuit Court of St. Louis Count,
alleging that during her employment, Defendants subjected her
to unlawful acts of retaliation and discrimination based on
her gender, age, and disability in violation of the Missouri
Human Rights Act, Mo. Rev. Stat. §§ 213.010, e/
seq. Defendants removed the case to federal court
based on diversity of citizenship. According to the Petition,
Plaintiff was employed by Defendant New American Funding
("NAF") first as a branch manager and then as an
area manager. (Pet. ¶ 10, ECF No. 5) Plaintiff alleges
that she was diagnosed with colon cancer and had to take
leave for treatment and surgery. (Pet. ¶ 12) Upon
returning to work, Plaintiff contends that she began to
suffer harassment, humiliation, and bullying by her
supervisor, Defendant John Reed ("Reed"), a Vice
President at NAF, including demands for her private medical
records to confirm her cancer. (Pet. ¶¶ 13-15)
Plaintiff further asserts that Reed and other NAF
representatives threatened to terminate her employment if
Plaintiff did not accept lower compensation and higher
performance goals. Plaintiff claims that, as a result of the
alleged discrimination, harassment, and retaliation on the
basis of gender, age, and disability, she felt forced to
resign from her position at NAF, resulting in a constructive
discharge. (Pet. ¶ 19)
have moved to stay the case and send the dispute to
arbitration based on a Loan Originator Employment Agreement
("Agreement") executed by Plaintiff as the Loan
Originator ("LO") and NAF as the Company.
(Defs.' Ex. A, ECF No. 9-1) The Agreement provides,
"[i]t is the intent of Company and LO that every
dispute, claim or controversy arising out of or relating to
LO's employment with Company . . . including, without
limitation, disputes regarding the termination of that
employment, be resolved by binding arbitration."
(Defs.' Ex. A p. 8) The Agreement further provides that
the arbitration shall be arbitrated before the American
Arbitration Association ("AAA"). (Id.)
Additionally, the Agreement states, "[i]n consideration
of the benefits provided to LO under this agreement, LO
further agrees to the terms of the Mutual Arbitrtion
Agreement attached as Exhibit C to this Agreement."
(Id.) (emphasis in original).
terms of the Mutual Arbitration Agreement ("MMA")
contained in Exhibit C provide that the parties "agree
to arbitrate before a neutral arbitrator any and all existing
or future disputes or claims between Employee and Employer,
that arise out of or relate to Employee's . . .
employment or separation from employment with Employer . . .
." (Defs.' Ex. A p. 18) Such claims include,
inter alia, claims for fraud; breach of contract;
wrongful termination; constructive discharge; tort; and
discrimination, harassment or retaliation, on the basis of
age, sex, disability or any other unlawful basis under
federal, state, or common law. (Id.) The governing
law provides that the parties agree to arbitrate under the
FAA and that, to the extent not inconsistent with the FAA,
the Agreement "shall be governed by the law of the state
where Employee works or worked at the time the arbitrable
dispute or claim arose." (Defs.' Ex. A p. 21)
opposes sending the matter to arbitration, arguing that
Defendant Reed lacks standing to compel arbitration.
Additionally, Plaintiff argues that the Agreement is not
supported by adequate consideration and that the Agreement is
Federal Arbitration Act, 9 U.S.C. §§ \, et
seq., '"establishes a liberal federal policy
favoring arbitration agreements.'" M.A.
Mortenson Co. v. Saunders Concrete Co., Inc., 676 F.3d
1153, 1156 (8th Cir. 2012) (quoting Lenz v. Yellow
Tramp., Inc., 431 F.3d 348, 351 (8th Cir. 2005)).
"[w]hen deciding whether to compel arbitration, a court
asks whether a valid agreement to arbitrate exists, and if
so, whether the dispute falls within the scope of that
agreement." Newspaper Guild of St. Louis, Local
36047 v. St. Louis Post Dispatch, LLC, 641 F.3d 263, 266
(8th Cir. 2011) (citation omitted). "The Supreme Court
has repeatedly noted that the Federal Arbitration Act was
designed to combat longstanding hostility to arbitration by
establishing 'a liberal federal policy favoring
arbitration agreements.'" Bob Schultz Motors,
Inc. v. Kawasaki Motors Corp., U.S.A., 334 F.3d 721, 725
(8th Cir. 2003) (quoting Moses H. Cone Mem 7
Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24
(1983)). Under the FAA, any doubts regarding the scope of
arbitrable issues should be resolved in favor of arbitration.
Lyster v. Ryan's Family Steak Houses, Inc., 239
F.3d 943, 945 (8th Cir. 2001) (citation omitted). This
liberal policy includes employment-related claims.
Id. at 947.
thorough consideration of the motion to compel and the
related memoranda by the parties, the Court finds that the
parties should be compelled to arbitrate Plaintiffs claims
against the Defendant. With regard to Plaintiffs assertion
that Defendant Reed lacks standing, the Eighth Circuit Court
of Appeals has held that under the FAA, a nonsignatory may
compel a signatory to arbitrate where the relationship
between the two parties is sufficiently close to permit such
enforcement. Finnie v. H & R Block Fin. Advisors,
Inc., 307 Fed.App'x 19, 21 (8th Cir. 2009) (finding
that plaintiffs former supervisor could compel arbitration
under the FAA where plaintiff asserted claims of racial
discrimination, harassment, and retaliation). Here, Defendant
Reed was Plaintiffs supervisor at NAF. The MAA specifically
includes "claims involving any current or former
officer, director, shareholder, agent or employee of Employer
. . . ." (Defs.' Ex. A p. 18) Thus, the Court finds
that Defendant Reed may enforce the arbitration Agreement
under these circumstances.
Court also finds that the Agreement is a bilateral contract
providing adequate consideration under Missouri law. "A
mutual promise between an employee and an employer to
arbitrate employment disputes is valid consideration to
create an enforceable bilateral contract." Humphries
v. SSMHealth Care Corp., No. 4:17CV786 RLW, 2017 WL
1246699, at *2 (E.D. Mo. Apr. 5, 2017) (citing Jiminez v.
Cintas Corp., 475 S.W.3d 679, 685-86 (Mo.Ct.App. 2015)).
Plaintiff argues, however, that the Agreement is lacks
mutuality of obligation because it compels arbitration for
those claims that employees would most likely bring against
Defendants but exempts from arbitration claims that Defendant
would most likely bring against its employees. Plaintiff also
contends that the Agreement is unilateral because it can be
modified in writing by the CEO of Employer and Employee.
contract that purports to exchange mutual promises will be
construed as lacking legal consideration if one party retains
the right to 'unilaterally divest itself of an obligation
to perform the promise initially made.'"
Jimenez, 475 S.W.3d at 686 (quoting Frye v.
Speedway Chevrolet Cadillac, 321 S.W.3d 429, 442
(Mo.Ct.App. 2010)). Courts determine whether an agreement
provides mutual obligation by looking at the language of the
agreement, reading the terms of the contract as a whole, and
giving each term its plain, ordinary, and usual meaning to
decide the intent of the parties. Id. (citations
Plaintiff points specifically to the "Claims not Covered
by the Agreement" in the MAA. (Defs.' Ex. A p. 19)
Plaintiff argues that this section exempts Defendants from
arbitrating claims that Defendants are most likely to bring
against employees such as claims involving temporary or
preliminary injunctive relief related to misuse of
intellectual property, theft of trade secrets, violation of
non-compete provisions, or breach of duty of loyalty.
However, Plaintiff misreads the Agreement. The MAA provides
that claims not covered by the agreement include claims for
workers' compensation, unemployment insurance, or state
or federal disability insurance; claims for benefits under an
ERISA plan; "claims for temporary or preliminary
injunctive relief... in aid of arbitration or to
maintain the status quo pending arbitration, in a
court of competent jurisdiction with applicable law;"
and any other dispute expressly excluded from arbitration by
statute. (Defs.' Ex. A p. 19) Included in covered claims
are claims for fraud, promissory estoppel, fraudulent
inducement of contract, or breach of contract, as well as
unfair business practices "and any other tort or
tort-like causes of action relating to or arising from the
employment relationship or the formation or termination
to Plaintiffs position, the MAA mutually covers claims that
both the employee and the employer could raise, including
discrimination claims brought by the employee, and contract,
tort, or tort-like claims brought by the employer. The only
claims for temporary or preliminary injunctive relief not
covered by the MAA pertain solely to arbitration. Thus, the
Court finds that the Agreement is supported by adequate
consideration. See, e.g. State ex rel. Hewitt v.
Kerr,461 S.W.3d 798, 809 (Mo. 2015) (finding
arbitration clause was supported by ...