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Barach v. Sinclair Media III, Inc.

United States District Court, S.D. West Virginia, Huntington Division

June 3, 2019

JIM BARACH, Plaintiff,



         Pending before the Court is Defendant's Motion to Compel Arbitration and Dismiss Complaint. ECF No. 5. Defendant argues in its motion that, pursuant to Federal Rule of Civil Procedure 12(b)(3), this action should be dismissed for improper venue because the dispute is covered by a binding arbitration clause in the parties' employment agreement. See Mot. to Dismiss, ECF No. 5. Plaintiff, however, argues that Defendant's motion should be denied because the arbitration clause is “substantively unconscionable, ” as it allegedly denies Plaintiff some of his statutory rights. See Resp. in Opp. to Def's Mot. to Dismiss, ECF No. 7, at 3.

         The parties have fully briefed the issues and the motion is now ripe for adjudication. As explained below, the Court GRANTS, IN PART, and DENIES, IN PART, Defendant's Motion to Compel Arbitration and Dismiss Complaint.

         I. Background

         For thirteen years, Plaintiff worked for Defendant as a chief meteorologist. See Compl., ECF No. 1-1, at ¶¶ 8-9. For at least the first decade of Plaintiff's employment, his employment contract was renewed on a two-year or three-year basis. See Id. at ¶ 11. However, in July of 2017, Defendant renewed Plaintiff's contract for only one year. See Id. at ¶ 13. Plaintiff was approximately sixty years old at the time. Id.

         In August of 2017, Plaintiff signed the aforementioned employment agreement with Defendant. See Mem. in Supp. of Def's Mot. to Dismiss, ECF No. 6, at 1; Agreement, ECF No. 5-1. The term of the agreement began on August 1, 2017, and ended July 31, 2018. See Mem. in Supp. of Def's Mot. to Dismiss, at 2. The agreement contained an arbitration clause, which provided:

Employee and Employer agree to submit any dispute or controversy arising out of or relating to this Agreement including, but not limited to, claims of termination allegedly resulting from discrimination of any type, claims based on common law, contract, or statutorily created or protected rights or any other basis prohibited by law, exclusively to final and binding arbitration before a neutral arbitrator.

See Agreement, at 9.

         In January of 2018, Plaintiff's supervisor allegedly told Plaintiff that Defendant's weather presentation needed to be “younger and hipper.” See Id. at ¶¶ 14-15. Defendant then fired Plaintiff on June 1, 2018, and allegedly replaced him with a thirty-nine-year-old individual. See Id. at ¶¶ 16-17.

         Plaintiff subsequently filed a complaint in the Circuit Court of Cabell County, West Virginia, alleging age discrimination in violation of the West Virginia Human Rights Act and in violation of the federal Age Discrimination in Employment Act of 1967. See Compl., at 10-11. On January 3, 2019, Defendant removed the matter to this Court. ECF No. 1.

         II. Standard of Review

         Arbitration is, “in effect, a specialized kind of forum-selection clause ….” See Bartels v. Saber Healthcare Grp., LLC, 880 F.3d 668, 679 n.2 (4th Cir. 2018) (quoting Scherk v. Alberto- Culver Co., 417 U.S. 506, 519 (1974)). In the past, the Fourth Circuit “treated motions to dismiss based on a forum selection clause as motions to dismiss for improper venue under Fed.R.Civ.P. 12(b)(3) ….” BAE Sys. Tech. Sol. & Servs. v. Republic of Korea's Def. Acquisition Program Admin., 884 F.3d 463, 470 n.4 (4th Cir. 2018). However, the Supreme Court later “clarified that a party may not seek to enforce a forum selection clause by moving to dismiss for improper venue; instead, ‘the appropriate way to enforce a forum-selection clause pointing to a ... foreign forum is through the doctrine of forum non conveniens.'”[1] Id. (emphasis added) (quoting Atlantic Marine Construction Co. v. U.S. District Court, 571 U.S. 49, 60 (2013)).

         However, rather than using the doctrine of forum non conveniens to enforce arbitration, a party may also move to compel arbitration pursuant to the Federal Arbitration Act (“FAA”). 9 U.S.C. § 1 et seq. If a party chooses this latter route to compel arbitration, the FAA requires a district court to stay the action and direct the parties to proceed to arbitration if the court decides that an arbitration clause covers the dispute.[2] See Id. at §§ 3-4. Of course, because “Congress did not intend for the FAA to force parties who had not agreed to arbitrate into a non-judicial forum, ” the FAA allows a party to challenge the enforceability of an arbitration clause in a district court by relying on state contract principles. See Sydnor v. Conseco Fin. Serv. Corp., 252 F.3d 302, 305 (4th Cir. 2001).

         When a motion to stay and compel arbitration is challenged, “the applicable legal standard is similar to that applied at summary judgment. Specifically, the pleadings and ‘all relevant, admissible evidence submitted by the parties' are considered and ‘all reasonable inferences' are drawn in favor of the non-moving party.'” Meridian Imaging Sol'ns, Inc. v. Omni Bus. Sol'ns LLC, 250 F.Supp.3d 13, 21 (E.D. Va. 2017) (quoting Nicosia v., Inc., 834 F.3d 220, 229 (2d Cir. 2016)).

         III. Discussion

         The FAA reflects the “fundamental principle that arbitration is a matter of contract, ” and “places arbitration agreements on equal footing with other contracts ….” Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63, 67 (2010). In the Fourth Circuit, a party may compel arbitration if it demonstrates the following: “(1) the existence of a dispute between the parties, (2) a written agreement that includes an arbitration provision which purports to cover the dispute, (3) the relationship of the transaction, which is evidenced by the agreement, to interstate or foreign commerce, and (4) the failure, neglect or refusal of the defendant to arbitrate the dispute.” Whiteside v. Teltech Corp., 940 F.2d 99, 102 (4th Cir. 1991).

         Defendant argues that this action should be dismissed, and arbitration should be compelled, because the four elements above are met. See Mot. to Dismiss. While Plaintiff does not dispute that all the elements above are met, he argues that the arbitration clause should not be enforced because it is substantively unconscionable. See Resp. in Opp. to Def's Mot. to Dismiss, at 3.

         “The doctrine of unconscionability means that, because of an overall and gross imbalance, one-sidedness or lop-sidedness in a contract, a court may be justified in refusing to enforce the contract as written. The concept of unconscionability must be applied in a flexible manner, taking into consideration all of the facts and circumstances of a particular case.” Brown v. Genesis Healthcare Corp., 724 S.E.2d 250, 283-84 ( W.Va. 2011) (reversed on other grounds). “A determination of unconscionability must focus on the relative positions of the parties, the adequacy of the bargaining position, the meaningful alternatives available to the plaintiff, and the existence of unfair terms in the contract.” See Id. at 284 (internal quotations omitted). “A contract term is unenforceable if it is both procedurally and substantively unconscionable. However, both need not be present to the same degree. Courts should apply a ‘sliding scale' in making this determination: the more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the clause is unenforceable, and vice versa.” See Id. at 289 (emphasis added).

         A. Whether the Arbitration Clause is Procedurally Unconscionable

         Before addressing the merits of Plaintiff's claim that the arbitration clause is substantively unconscionable, Defendant argues that, because “Plaintiff did not allege that the arbitration clause was [also] procedurally unconscionable … the clause cannot be held to be unconscionable as a whole ...

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