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Adam Hill, et al., Plaintiffs v. Wackenhut Services International

June 7, 2012

ADAM HILL, ET AL., PLAINTIFFS,
v.
WACKENHUT SERVICES INTERNATIONAL, ET AL., DEFENDANTS.



The opinion of the court was delivered by: James E. Boasberg United States District Judge

MEMORANDUM OPINION

Plaintiffs were employed by Defendant Wackenhut Services LLC as firefighters in Iraq and Afghanistan. They brought this action against Wackenhut and its affiliates, as well as against other companies, alleging that they were unlawfully denied various forms of employment benefits and compensation, such as in-country and overtime pay. The Wackenhut Defendants have now filed a Motion to Compel Arbitration and Stay Litigation, arguing that the claims set forth in Plaintiffs' Complaint are subject to a mandatory-arbitration provision in their employment agreements. Seeking to avoid arbitration, Plaintiffs challenge the validity of the provision and argue that the Court -- not an arbitrator -- must determine whether a valid, enforceable arbitration agreement exists before ordering Plaintiffs to submit their claims to an arbitrator. The Court agrees that it is the appropriate authority to resolve Plaintiffs' challenges to the disputed arbitration clause; upon review of these challenges, however, the Court finds that the arbitration agreement is valid and covers the allegations in the Complaint. Defendants' Motion will thus be granted.

I.Background

On December 6, 2011, Plaintiffs filed suit against a single entity they call "Wackenhut Services International, aka Wackenhut Services Inc., aka Wackenhut Services LLC." See Compl. at 3-4. Wackenhut explains that its named businesses are separate entities, see Motion to Compel at 1 & n.1, and the Court will thus refer to them as "the Wackenhut Defendants." Plaintiffs also sued two other government-contracting companies that Plaintiffs claim "oversaw and controlled" Wackenhut -- Halliburton Corp. and Kellogg-Brown & Root, LLC (in several corporate forms) -- alleging all Defendants deprived them of "in-country pay, danger pay, on-call pay, up-lift pay, overtime, and other benefits and compensation" in relation to their work as firefighters in Iraq and Afghanistan. Compl., ¶¶ 2, 4. Plaintiffs claim that they received promises of such compensation to "induce them to leave their families in the United States and work under harsh conditions in Iraq and Afghanistan" from 2005 to the present. Id., ¶¶ 4, 62. They assert twelve separate causes of action related to these allegations. Id., ¶¶ 72-137.

The terms of Plaintiffs' employment were set forth in employment contracts that were signed annually by each Plaintiff. Id., ¶ 53. Although Plaintiffs reference these employment contracts throughout their Complaint, see id., ¶¶ 5, 53, 60, 61, 73, 74, 76, 88-91, 104, they never cite to specific language from these agreements, nor do they attach a copy of any of the contracts. In moving to compel arbitration, the Wackenhut Defendants attach a standard-form employment agreement embodying the terms and conditions of employment that they claim would be found in each of Plaintiffs' individual employment contracts, including a clause requiring employees to arbitrate disputes with their employer. See Mot., Declaration of Luke Shelton, ¶ 3 & Exh. 1 (Form Employment Agreement), ¶ 27.

Plaintiffs in their Opposition disavow any knowledge of this agreement. See Opp. at 2; see also id. at 9, 11-12 ("we have no proof that the particular exemplar agreement . . . was ever given to these plaintiffs or was signed by them"; "there is nothing showing one of these plaintiffs signed or initialed it or one materially like it, or that it contained an arbitration clause"). Plaintiffs provide no support for this general denial, nor do they provide any evidence that the contracts they signed or the applicable arbitration clause was different from the standard-form agreement provided by Defendants.

Defendants' Reply endeavors to "lay[] to rest any question over the existence of written arbitration agreements between Plaintiffs and Wackenhut Services, LLC" by attaching signed employment agreements for "three of the Plaintiffs, which span the time of Plaintiffs' proposed class period." Reply at 3 n.2. In the signed agreements, Plaintiffs separately initialed the "Specific Terms and Conditions" -- including the arbitration provision -- and signed the agreement, acknowledging that they had "read this Employment Agreement and fully understand, agree, and consent to the terms and conditions of this Agreement." Reply, Declaration of Clyde S. Brinkley, Exhs. 1-3 (employment agreements of Plaintiffs Hill, Harville, and Garber).

In paragraph 27 of the signed agreements, under the heading "Claims/Disputes," the contracts state:

In consideration of your employment, you agree that your assignment, job or compensation can be terminated with or without cause, with or without notice at any time at your option or at Employer's option. You also agree that you will be bound by and accept as a condition of your employment the terms of the Wackenhut Dispute Resolution Program which are herein incorporated by reference. You understand that the Dispute Resolution Program requires, as its last step, that any and all claims that you might have against Employer related to your employment, including your termination, and any and all personal injury claim arising in the workplace, you have against other parent or affiliate of Employer, must be submitted to binding arbitration instead of to the court system.

See, e.g., Garber Agreement, ¶ 27 (emphasis added). Additionally, the contracts state that they "shall be governed by and construed in accordance with the laws of the State of Florida" and "in accordance with the Federal Arbitration Act." Id., ¶ 26.

Pursuant to the arbitration provision in Plaintiffs' employment contracts, the Wackenhut Defendants now move to compel arbitration and stay this litigation.

II.Legal Standard

When considering a motion to compel arbitration, "the appropriate standard of review for the district court is the same standard used in resolving summary judgment motions" pursuant to Federal Rule of Civil Procedure 56(c). See Aliron Intern., Inc. v. Cherokee Nation Indus., Inc., 531 F.3d 863, 865 (D.C. Cir. 2008); Hughes v. CACI, Inc., 384 F. Supp. 2d 89, 92--93 (D.D.C. 2005); Brown v. Dorsey & Whitney, LLP, 267 F. Supp. 2d 61, 67 (D.D.C. 2003).

As the party seeking to compel arbitration, Defendants must first come forward with "evidence sufficient to demonstrate an enforceable agreement to arbitrate." See Smart Text Corp. v. Interland, Inc., 296 F. Supp. 2d 1257, 1263 (D. Kan. 2003). The burden then shifts to Plaintiffs "to raise a genuine issue of material fact as to the making of the agreement, using evidence comparable to that identified in Fed. R. Civ. P. 56." See Grosvenor v. Qwest Communications International, Inc., 2010 WL 3906253, at *5 (D. Colo. 2010). Arbitration shall be compelled if there is "'no genuine issue of fact concerning the formation of the agreement' to arbitrate." Kirleis v. Dicki, McCamey & Chilcote, P.C., 560 F.3d 156, 159 (3d Cir. 2009) (quoting Par--Knit Mills, Inc. v. Stockbridge Fabrics Co., 636 F.2d 51, 54 (3d Cir. 1980)).

A fact is "material" if it is capable of affecting the substantive outcome of the litigation. Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Cir. 2006); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is "genuine" if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. See Scott v. Harris, 550 U.S. 372, 380 (2007); Liberty Lobby, 477 U.S. at 248; Holcomb, 433 F.3d at 895. "A party asserting that a fact cannot be or is genuinely disputed must support the assertion by citing to particular parts of materials in the record." Fed. R. Civ. P. 56(c)(1)(A).

The party seeking summary judgment "bears the heavy burden of establishing that the merits of his case are so clear that expedited action is justified." Taxpayers Watchdog, Inc., v. Stanley, 819 F.2d 294, 297 (D.C. Cir. 1987). When a motion for summary judgment is under consideration, "the evidence of the non-movant[s] is to be believed, and all justifiable inferences are to be drawn in [her] favor." Liberty Lobby, 477 U.S. at 255; see also Mastro v. PEPCO, 447 F.3d 843, 850 (D.C. Cir. 2006); Aka v. Washington Hosp. Ctr., 156 F.3d 1284, 1288 (D.C. Cir. 1998) (en banc). On a motion for summary judgment, the Court must "eschew making credibility determinations or weighing the evidence." Czekalski v. Peters, 475 F.3d 360, 363 (D.C. Cir. 2007).

The nonmoving party's opposition, however, must consist of more than mere unsupported allegations or denials and must be supported by affidavits, declarations, or other competent evidence, setting forth specific facts showing that there is a genuine issue for trial. Fed. R. Civ. P. 56(e); Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). The non-movant is required to provide evidence that would permit a reasonable jury to find in its favor. Laningham v. United States Navy, 813 F.2d 1236, 1242 (D.C. Cir. 1987). If the non-movant's evidence is "merely colorable" or "not significantly probative," summary judgment may be granted. Liberty Lobby, Inc., 477 U.S. at 249-50.

III.Analysis

By enacting the Federal Arbitration Act, 9 U.S.C. § 1 et seq., Congress "manifest[ed] a 'liberal federal policy favoring arbitration agreements.'" Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 25 (1991) (quoting Moses H. Cone Mem. Hosp. v. Mercury Construction Corp., 460 U.S. 1, 24 (1983)). The FAA provides that "[a] written provision in any . . . contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract." 9 U.S.C. § 2.

The FAA thus creates a strong presumption in favor of enforcing arbitration agreements, and "any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration." Moses H. Cone, 460 U.S. at 24-25; see also Shearson/Am. Express, Inc. v. McMahon, 482 U.S. 220, 226--27 (1987) (stating that arbitration agreements must be rigorously enforced). Nevertheless, parties cannot be forced into arbitration unless they have agreed to do so. AT&T Techs. Inc. v. Commc'ns Workers, 475 U.S. 643, 648--49 (1986).

Questions of arbitrability are typically brought before courts pursuant to Section 4 of the FAA, which permits a party to petition any United States district court that would otherwise have subject-matter jurisdiction "for an order directing that such arbitration proceed in the manner provided for in such agreement." 9 U.S.C. ยง 4. When presented with a motion to compel arbitration, a district court must "determine the enforceability of the agreement [to arbitrate] ...


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