United States District Court, District of Columbia
G. SULLIVAN UNITED STATES DISTRICT JUDGE.
Jensine Andresen brings this lawsuit against defendant
IntePros Federal, Inc. Dr. Andresen asserts various federal
and District of Columbia statutory claims, including claims
under the Age Discrimination in Employment Act of 1967; Title
VII of the Civil Rights Act of 1964; the Fair Labor Standards
Act; the District of Columbia Human Rights Act; and the
District of Columbia Wage Payment and Collection Law. Pending
before the Court is IntePros' renewed motion to compel
arbitration and to stay this litigation pending arbitration.
Upon consideration of the motion, the response and reply
thereto, the parties' supplemental filings, the
applicable law, and the entire record, the Court
GRANTS IntePros' renewed motion to
compel arbitration and STAYS this action
during the pendency of the arbitration. IntePros will be
responsible for arbitral fees and expenses in the manner
13, 2013, Dr. Andresen entered into a written contract with
IntePros entitled “Sub Contractor Agreement IT
Consulting” (“the Agreement”), wherein Dr.
Andresen contracted with IntePros to perform work on a
government contract with TRICARE Management Activity, which
has since become the Defense Health Agency
(“DHA”). Am. Compl., ECF No. 10-1 ¶ 13; Sub
Contractor Agreement IT Consulting (“Agreement”),
Ex. 2, ECF No. 12-1. The Agreement contains an arbitration
clause that reads in full:
Any and all disputes, controversies and claims arising out of
or relating to this Agreement or concerning the respective
rights or obligation [sic] hereunder of the parties hereto
shall be settled and determined by arbitration before the
Commercial Panel of the American Arbitration Association in
accordance with the Commercial Arbitration Rules. The
arbitrators shall have the power to award specific
performance or injunctive relief and reasonable
attorneys' fees and expenses to any party in any such
arbitration. However, in any arbitration proceeding arising
under this Agreement, the arbitrators shall not have the
power to change, modify or alter any express condition, term
or provision hereof, and to that extent the scope of their
authority is limited. The arbitration award shall be final
and binding upon the parties and judgment thereon may be
entered in any court having jurisdiction thereof.
Provision 9(f), Ex. 2, ECF No. 12-1 at 4. Dr. Andresen worked
for IntePros pursuant to the Agreement as an
“Information Technology Analyst I” at DHA until
she was terminated on June 16, 2014. Am. Compl., ECF No. 10-1
¶¶ 15, 174.
March 26, 2015, Dr. Andresen filed a complaint against
IntePros in this Court alleging age discrimination, sex
discrimination, unlawful retaliation, and failure to pay
overtime compensation. Compl., ECF No. 1 ¶¶ 204-31.
IntePros subsequently filed a motion to compel arbitration.
Def.'s Mot. to Compel Arbitration, ECF No. 5. Prior to
the Court resolving that motion, on November 25, 2015, Dr.
Andresen filed a motion to amend the complaint, seeking to
add two additional claims of unlawful termination.
See Mot. to Amend Compl., ECF No. 10. IntePros
opposed the motion to amend the complaint and filed a renewed
motion to compel arbitration. See Def.'s Renewed
Mot. to Compel Arbitration, ECF No. 11; Def.'s Mem. in
Supp. of Renewed Mot. to Compel Arbitration and Opp. to Mot.
to Amend Compl. (“Def.'s Mem. Supp.”), ECF
No. 12. The parties briefed the motion to amend and the
renewed motion to compel arbitration. See Def.'s
Mem. Supp., ECF No. 12; Pl.'s Opp. to Renewed Mot. to
Compel Arbitration and Reply to Opp. to Mot. to Amend Compl.
(“Pl.'s Opp.”), ECF No. 13; Def.'s Reply,
ECF No. 15. On March 29, 2016, the Court granted Dr.
Andresen's motion to amend her complaint and, in light of
the renewed motion to compel arbitration, denied as moot
IntePros' initial motion to compel arbitration.
See Minute Entry of March 29, 2016. Upon review of
the parties' briefing of IntePros' renewed motion,
the Court concluded that supplemental briefing would greatly
aid in the resolution of that motion. Having received that
supplemental briefing, IntePros' renewed motion is ready
Standard of Review
motion to compel arbitration is examined under the summary
judgment standard of Federal Rule of Civil Procedure 56(c),
as if it were “‘a request for summary disposition
of the issue of whether or not there had been a meeting of
the minds on the agreement to arbitrate.'”
Mercadante v. XE Servs., LLC, 78 F.Supp.3d 131, 136
(D.D.C. 2015) (quoting Aliron Int'l, Inc. v. Cherokee
Nation Indus., Inc., 531 F.3d 863, 865 (D.C. Cir.
2008)). Under Rule 56(c), summary judgment is appropriate
only if “‘there is no genuine issue as to any
material fact and . . . the moving party is entitled to a
judgment as a matter of law.'” Id.
(quoting Aliron Int'l, 531 F.3d at 865).
“‘The party seeking to compel arbitration must
present evidence sufficient to demonstrate an enforceable
agreement to arbitrate.'” Id. (quoting
Haire v. Smith, Currie & Hancock LLP, 925
F.Supp.2d 126, 129 (D.D.C. 2013)). “The burden then
shifts to plaintiffs to show that there is a genuine issue of
material fact as to the making of the agreement.”
Id. (internal quotation marks omitted). “The
Court will compel arbitration if the pleadings and the
evidence show that there is no genuine issue as to any
material fact and that the moving party is entitled to
judgment as a matter of law.” Id. (internal
quotation marks omitted).
enacted the Federal Arbitration Act (“FAA”) to
counteract “widespread judicial hostility to
arbitration.” Am. Express Co. v. Italian Colors
Rest., 133 S.Ct. 2304, 2308-09 (2013). Section 2 is
“the primary substantive provision of the [FAA].”
Moses H. Cone Mem'l Hosp. v. Mercury Constr.
Corp., 460 U.S. 1, 24 (1983). It provides that
“[a] written provision in . . . a 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 “also
establishes procedures by which federal courts implement
§ 2's substantive rule.” Rent-A-Center,
West, Inc. v. Jackson, 561 U.S. 63, 68 (2010).
“Under § 3, a party may apply to a federal court
for a stay of the trial of an action ‘upon any issue
referable to arbitration under an agreement in writing for
such arbitration.'” Id. (quoting 9 U.S.C.
§ 3). “Under § 4, a party
‘aggrieved' by the failure of another party
‘to arbitrate under a written agreement for
arbitration' may petition a federal court ‘for an
order directing that such arbitration proceed in the manner
provided for in such agreement.'” Id.
(quoting 9 U.S.C. § 4).
“question whether the parties have submitted a
particular dispute to arbitration”--that is, the
gateway “question of arbitrability”--is usually
“an issue for judicial determination.” Howsam
v. Dean Witter Reynolds, Inc., 537 U.S. 79, 83 (2002)
(internal quotation marks omitted). That usual rule is
upended, however, when the parties “clearly and
unmistakably” agree that the question of arbitrability
should be reserved for arbitral resolution. Id. A
written agreement memorializing the parties' agreement to
arbitrate the threshold question of arbitrability has come to
be known as a “delegation provision.” See
Rent-A-Center, 561 U.S. at 68. A delegation provision
“is simply an additional, antecedent agreement the
party seeking arbitration asks the federal court to enforce,
and the FAA operates on this additional arbitration agreement
just as it does on any other.” Id. at 70.
when a valid and enforceable delegation provision is in
place, a court is prohibited from reaching the gateway
question of arbitrability and must reserve that question for
arbitral resolution. See id.; Howard v.
Rent-A-Center, Inc., No. 10-103, 2010 WL 3009515, at *3
(E.D. Tenn. July 28, 2010) (“If the court concludes the
parties intended such a delegation and concludes that
delegation is enforceable, the court must compel arbitration
on issues relating to arbitrability along with the underlying
dispute.”). However, when a delegation provision is
invalid or unenforceable, that opens the door for judicial
resolution of the question of arbitrability. Thus
“before an arbitrator can determine the question of
arbitrability, the Court must consider any challenges to the
validity of the delegation provision.”
Mercadante, 78 F.Supp.3d at 137. If the challenges
of a party opposed to arbitration are directed at the
“primary” arbitration clause generally--as
opposed to being directed at the delegation provision
specifically--the delegation provision must be treated as
valid and enforceable and, accordingly, the question of
arbitrability must be reserved for an arbitrator.
Rent-A-Center, 561 U.S. at 72. Thus, in sum, where a
primary arbitration clause and a delegation provision are
both in place, a party opposed to arbitration must overcome
two hurdles to entirely avoid arbitration: (1) She must
demonstrate that the delegation provision, separate and apart
from the primary arbitration clause, is invalid or
unenforceable such that the threshold question of
arbitrability should be subject to judicial, rather than
arbitral, resolution; and, once she has cleared that first
hurdle, (2) she must demonstrate that the primary arbitration
clause is invalid or unenforceable such that the merits
question--that is, the underlying substantive claims--should
be subject to judicial, rather than arbitral, resolution.
Dr. Andresen does not dispute that the Agreement includes a
delegation provision. See Pl.'s Opp., ECF No. 13
at 3. The first sentence of the Agreement's arbitration
clause states that “[a]ny and all disputes,
controversies and claims arising out of or relating to this
Agreement or concerning the respective rights or obligation
[sic] hereunder of the parties hereto shall be settled and
determined by arbitration before the Commercial Panel of the
American Arbitration Association in accordance with the
Commercial Arbitration Rules.” Agreement, Provision
9(f), Ex. 2, ECF No. 12-1 at 4. The parties agree that the
arbitration clause's incorporation of the American
Arbitration Association (“AAA”) rules--which, in
turn, empower an arbitrator to rule on the question of
arbitrability, see AAA Commercial Arbitration Rules
and Mediation Procedures (effective October 1, 2013), Rule
7--constitutes clear and unmistakable
evidence that they intended to delegate the question of
arbitrability to an arbitrator. Def.'s Mem. Supp., ECF
No. 12 at 4-6; Pl.'s Opp., ECF No. 13 at 3. “While
the D.C. Circuit has not addressed the issue, courts both
within and outside this jurisdiction have held that an
arbitration clause adopting the rules of the AAA makes the
issue of arbitrability one for the arbitrator, not the
court.” W & T Travel Servs., LLC v. Priority
One Servs., Inc., 69 F.Supp.3d 158, 167-68 (D.D.C. 2014)
(collecting cases). Thus, the parties are on solid ground in
agreeing that their Agreement includes a delegation provision
that delegates the question of arbitrability to an
to avoid arbitration of her claims despite the
Agreement's delegation provision and primary arbitration
clause, Dr. Andresen launches the requisite two-step attack:
She first argues that the delegation provision is
unenforceable such that the question of arbitrability is
subject to judicial resolution, see Pl.'s Opp.,
ECF No. 13 at 3-5; Pl.'s Suppl. Br., ECF No. 17 at 2-13,
and then, assuming that she has prevailed on that argument,
she argues that the arbitration clause is unenforceable such
that her substantive claims are subject to judicial
resolution. See Pl.'s Opp., ECF No. 13 at 6-9.
The Court can only reach the second prong of this attack if
Dr. Andresen prevails on the first.
that first prong, Dr. Andresen argues that the delegation
provision is unenforceable under the effective vindication of
statutory rights doctrine of the federal common law. First,
she states that the arbitration clause here contains no
express statement regarding the allocation of arbitral
expenses and fees, “making the AAA rules controlling
authority for the arbitrator's compensation and other
arbitration fees.” Pl.'s Opp., ECF No. 13 at
She asserts that those Rules provide that the
“‘arbitrator may apportion such fees, expenses
and compensation among the parties in such amounts as the
arbitrator deems appropriate.'” Id. at 4-5
(quoting AAA Commercial Arbitration Rules and Mediation
Procedures, Rule 47).Relying on Cole v. Burns International
Security Services, 105 F.3d 1465, 1483-86 (D.C. Cir.
1997), she argues that the possibility that she might have to
pay some portion of arbitral fees and expenses to resolve the
threshold question of arbitrability runs afoul of
Cole's per se prohibition of an employee having
“to pay any of the arbitrator's fees when pursuing
federal statutory claims.” Pl.'s Opp., ECF No. 13
at 3-5; see also Pl.'s Suppl. Br., ECF No. 17 at
2-3. She further argues that Cole's per se rule
remains viable--at least where federal statutory claims in
the employer-employee context are concerned--after Green
Tree Financial Corp.-Alabama v. Randolph, 531 U.S. 79
(2000). See Pl.'s Suppl. Br., ECF No. 17 at 3-9.
In Green Tree, the Supreme Court rejected a
cost-prohibitiveness unenforceability challenge to an
arbitration clause in a case involving a claim under the
federal Truth in Lending Act, announcing that “where .
. . a party seeks to invalidate an arbitration agreement on
the ground that arbitration would be prohibitively expensive,
that party bears the burden of showing the likelihood of
incurring such costs.” 531 U.S. at 92. Second, Dr.
Andresen argues that even if Cole's per se rule
does not apply in this case, she has carried her burden under
Green Tree of demonstrating that arbitrating
arbitrability would be prohibitively expensive. Pl.'s
Suppl. Br., ECF No. 17 at 9-13. The Court turns now to an
assessment of these arguments.
Cole Announced a Per Se Rule Prohibiting Arbitral
Fee-Sharing Between an Employee and an Employer But, Assuming
that Per Se Rule Remains Viable, It Does Not Apply in the
Context of a Challenge to a Delegation Provision
Cole, an employee had filed a Title VII
discrimination claim against his employer, and the employer
sought to compel arbitration under an arbitration agreement
between the parties. 105 F.3d at 1467. The arbitration
agreement was silent when it came to who would pay the
arbitrator's fees and thus contemplated that the employee
would have to shoulder some share of arbitral expenses.
See Id. at 1485. “The court reasoned that
requiring an employee to pay arbitration fees, other than
‘reasonable costs' analogous to federal court
‘filing fees and other administrative expenses, '
would be ‘prohibitively expensive' and deter the
employee from ‘pursu[ing] his statutory
claims.'” Fox v. Comput. World Servs.
Corp., 920 F.Supp.2d 90, 100-01 (D.D.C. 2013) (quoting
Cole, 105 F.3d at 1484). Accordingly, the court was
only willing to find the arbitration agreement valid and
enforceable as to the Title VII claim by reading it as
allocating all of the costs of arbitration to the employer,
in turn giving rise to a per se rule invalidating arbitration
agreements that require an employee “to pay all or part
of the arbitrator's fees and expenses.”
See 105 F.3d at 1485. Thus, the court held,
“an employee can never be required, as a condition of
employment, to pay an arbitrator's compensation in order
to secure the resolution of statutory claims.”
Id. at 1468.
is little doubt that Cole announced a per se rule
that arbitration agreements that contemplate an employee
paying arbitral expenses other than those analogous to
federal court filing fees and administrative expenses are
unenforceable unless the arbitrator's fees are paid by
the employer. See Bradford v. Rockwell Semiconductor
Sys., Inc., 238 F.3d 549, 554 (4th Cir. 2001)
(describing Cole as announcing a per se rule);
Fox, 920 F.Supp.2d at 101 (same); Toledano v.
O'Connor, 501 F.Supp.2d 127, 148 (D.D.C. 2007)
(same); Nelson v. Insignia/Esg, Inc., 215 F.Supp.2d
143, 154 (D.D.C. 2002) (same). But the Supreme Court's
post-Cole decision in Green Tree puts
Cole's per se rule under serious strain. In
Green Tree, the Court considered whether an
arbitration agreement that was silent as to arbitration costs
and fees was unenforceable as to a federal statutory claim
because the agreement failed to affirmatively protect a party
from potentially steep arbitration costs. 531 U.S. at 82. The
Court held that the agreement was not unenforceable on the
ground that the “risk” of prohibitive costs was
“too speculative” to justify ...