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Davidow v. H&R Block, Inc.

United States District Court, W.D. Missouri, Western Division

May 13, 2019

JANICE DAVIDOW, individually and o/b/o others similarly situated Plaintiff,
v.
H&R BLOCK, INC., et al., Defendants.

          ORDER AND OPINION (1) GRANTING DEFENDANTS' MOTION TO COMPEL ARBITRATION ON AN INDIVIDUAL BASIS, (2) GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION TO STRIKE REPLY OR FOR LEAVE TO FILE SUR-REPLY, AND (3) STAYING THE MATTER PENDING ARBITRATION

          ORTRIE D. SMITH, UNITED STATES DISTRICT COURT SENIOR JUDGE

         Pending are Defendants' Motion to Compel Arbitration on an Individual Basis (Doc. #20), and Plaintiff's Motion to Disregard/Strike, or in the Alterative, for Leave to File Sur-Reply (Doc. #36). For the following reasons, Defendants' motion is granted, and Plaintiff's motion is granted in part and denied in part.

         I. BACKGROUND[1]

         During the 2012 and 2013 tax seasons, Plaintiff Janice Davidow worked as a seasonal tax preparer for “H&R Block” in Florida. In December 2018, Plaintiff filed this putative class action against Defendants H&R Block, Inc. and H&R Block Tax Services LLC, alleging Defendants, along with other entities and persons, “enacted a scheme related to the recruitment of employees and potential employees, which included policies and agreements not to solicit or recruit without prior approval [from] each other's personnel.” Doc. #1, ¶ 17. According to Plaintiff, the franchise agreement between Defendants and their franchisees included a restriction on competition: “During the term of this agreement, neither Franchisee nor any of Franchisee's Associates will, without H&R Block's prior written consent…[s]olicit for employment any person who is employed by H&R Block or by any other franchisee of H&R Block.” Id. ¶¶ 18, 36-40. Defendants adhered to the same agreement in company-owned stores. Id. ¶¶ 19, 41. Among other things, Plaintiff alleges the “purpose and effect of this scheme was to limit and suppress mobility and compensation for class members.” Id. ¶¶ 20-21, 66-74. Plaintiff alleges Defendants violated the Sherman Act.

         Defendants move to compel arbitration on an individual basis. Doc. #22. They argue that, in November 2011 (“2011 agreement”) and in November 2012 (“2012 agreement”), Plaintiff agreed to arbitrate all claims against H&R Block companies when she signed her tax professional employment agreements. Doc. #21-2, at 4-6; Dco. #21-3, at 5-7. The 2011 agreement contains the following relevant provisions:

19. a) Associate and the Company agree that any Covered Claims (defined below) will be resolved by final and binding arbitration…governed by the Federal Arbitration Act (FAA) and the laws of the State of Missouri to the extent Missouri law is not inconsistent with the FAA.
* * * *
b) Covered Claims. Except for the Excluded Claims (defined below), Covered Claims include any and all claims or disputes between Associate and the Company, or the Company's parents, subsidiaries, affiliates, predecessors, and successor corporations and business entities, and its and their officers, directors, employees, and agents, including but not limited to claims and disputes arising out of or in any way related to Associate's hiring or recruitment, this Agreement, Associate's employment, compensation, benefits, and terms and conditions of employment with the Company, or the termination thereof, including but not limited to contract, tort, defamation and other common law claims, wage and hour claims, statutory discrimination, harassment, and retaliation claims, and claims arising under or relating to any federal, state or local constitution, statute or regulation, including, without limitation, the Fair Labor Standards Act (“FLSA”), Title VII of the Civil Rights Act of 1964 (“Title VII”), the Age Discrimination in Employment Act (“ADEA”), the Worker Adjustment and Retraining Notification Act (“WARN”), the Equal Pay Act (“EPA”), the Americans With Disabilities Act (“ADA”), the Family and Medical Leave Act (“FMLA”), and any and all other federal, state, or local constitutional, statutory, regulatory, or common law claims or causes of action now or hereafter recognized.
c) The following claims and disputes are not subject to the arbitration agreement set forth in this Agreement: (i) applications for temporary or preliminary injunctive relief in aid of arbitration or for the maintenance of the status quo pending arbitration, (ii) claims arising under, relating to or in connection with an employee benefit plan subject to the Employee Retirement Income Security Act of 1974 (“ERISA”), which shall be determined in accordance with the claims and dispute resolution procedures set forth in the applicable ERISA plan documents, (iii) claims for workers' compensation benefits, but not retaliation claims arising out of or relating to claims for workers' compensation benefits, (iv) claims for unemployment compensation benefits, (v) claims within the jurisdiction of the National Labor Relations Board (“NLRB”), and (vi) any claim that is expressly precluded from arbitration by a federal statute or regulation. Nothing in this Agreement shall prohibit Associate from filing a charge or complaint with the U.S. Equal Employment Opportunity Commission, the NLRB, the U.S. Department of Labor, the Occupational Safety and Health Commission, any other federal, state, or local administrative agency; however, any Covered Claim that is not resolved through the federal, state, or local agency proceedings must be submitted to arbitration in accordance with this Agreement, except for claims within the jurisdiction of the NLRB and where expressly precluded by a federal statute or regulation. Associate also has the right to challenge the validity of the terms and conditions of this Agreement on any grounds that may exist in law and equity, and the Company shall not discipline, discharge, or engage in any retaliatory actions against Associate in the event Associate chooses to do so or engage in other protected legal activity. The Company, however, reserves the right to enforce the terms and conditions of this Agreement in any appropriate forum.
d) ASSOCIATE AND THE COMPANY AGREE THAT NO COVERED CLAIMS MAY BE INITIATED OR MAINTAINED ON A CLASS, COLLECTIVE OR REPRESENTATIVE ACTION BASIS EITHER IN COURT OR IN ARBITRATION, AND THAT ASSOCIATE IS NOT ENTITLED TO SERVE OR PARTICIPATE AS A CLASS, COLLECTIVE OR REPRESENTATIVE ACTION MEMBER, OR RECEIVE ANY RECOVERY FROM A CLASS, COLLECTIVE OR REPRESENTATIVE ACTION INVOLVING COVERED CLAIMS EITHER IN COURT OR IN ARBITRATION.
* * * *
21. Associate may opt-out of (reject) Section 19 by submitting a signed written statement that Associate wishes to opt-out and not be subject to section 19 of this Agreement. In order to be effective, the written statement must include Associate's full name, address, and employee ID number, and must be submitted to H&R Block - Legal Department, Attention: Arbitration Opt-Out, One H&R Block Way, Kansas City, Missouri 64105 within thirty (30) days of Associate's signing of this Agreement. Associate's written opt-out will override Associate's signature below regarding arbitration, but no other provision of this Agreement. Any associate choosing to opt-out will not be subject to any adverse employment action as a consequence of that decision.[2]
* * * *
By checking the relevant box on the previous web page (the Contract section of the Automated Hiring Process), you are indicating your agreement to the above terms and condition, including but not limited to the Arbitration agreement and Waiver in Section 19. Checking the box on the previous web page will serve as your electronic signature. Once you have checked that box, a signature[, ] date and confirmation code will display in this document, below.

Doc. #21-2, at 4-6 (emphasis in original). The 2012 agreement is similar to the 2011 agreement provisions noted above. There are a few minor differences: (1) the arbitration provision does not refer to Missouri law but a separate provision in the agreement - paragraph 17 - indicates the agreement is governed by Missouri law; (2) the opt-out paragraph is numbered 20 (instead of 21); and (3) in the paragraph immediately preceding the signature space, it refers to “checking the sign and submit button” (instead of ...


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