United States District Court, D. Rhode Island
SAMANTHA BINIENDA, on behalf of herself and all others similarly situated, Plaintiff,
ATWELLS REALTY CORP. and THE ONE, INC., all d/b/a CLUB DESIRE and LUST VIP, Defendants.
MEMORANDUM AND ORDER
WILLIAM E. SMITH, CHIEF JUDGE
Atwells Realty Corp. and The One, Inc. (collectively,
“Defendants”) moved to dismiss this action and
compel arbitration (ECF No. 83), and to stay the action and
amend the pre-trial scheduling order (ECF No. 85). For the
reasons that follow, both motions are DENIED. I. Background
The facts as they relate to Defendants' motions are
simple and undisputed. Plaintiff Samantha Binienda
(“Plaintiff”) began performing as an exotic
dancer at Defendants' club in November 2013. On June 20,
2015, Plaintiff brought this putative class action, alleging,
inter alia, that Defendants misclassified exotic dancers as
independent contractors instead of employees, which resulted
in violations of the Fair Labor Standards Act, 29 U.S.C.
§ 201 et seq., and Rhode Island state law. Both
parties participated in the litigation, engaging in discovery
and filing pre-trial motions.
discovery, both parties discussed whether Plaintiff had ever
signed Defendants' standard Entertainers Independent
Contractor Agreement. Gerard DiSanto II
(“DiSanto”), Defendants' general manager,
testified that he did not know whether all of the dancers at
the club had signed such a contract, and that many signed
contracts had gone missing in the disorderly records room.
Defs.' Mot. To Compel 2 (ECF No. 83-1). During
Plaintiff's deposition on March 31, 2017, she was asked
if she ever signed the standard contract, to which she
replied, “No, I never did. I can specifically remember
the first day I worked there, and I never signed a
discovery closed, both parties filed cross-motions for
summary judgment and cross-motions for class certification.
At some point in June or July of 2017, DiSanto located the
Entertainers Independent Contractor Agreement, which had been
signed by Plaintiff on November 5, 2013 (“Binienda
Contract”). On July 20, 2017, twenty-five months after
Plaintiff filed the Complaint, Defendants filed the instant
motion to compel arbitration pursuant to an arbitration
provision within the Binienda Contract. In response,
Plaintiffs contend that Defendants waived their arbitration
rights under the contract by waiting more than two years to
move to compel arbitration.
parties dispute whether this Court or an arbitrator should
decide the issue of waiver. For the reasons that follow, this
decision remains with the Court.
Supreme Court in BG Group PLC v. Republic of
Argentina explained that this threshold question -
whether this Court or an arbitrator should decide the waiver
issue - is guided by a set of presumptions. 134 S.Ct. 1198
(2014). First, “courts presume that the parties intend
courts, not arbitrators, to decide what we have called
disputes about ‘arbitrability' . . . such as
‘whether the parties are bound by a given arbitration
clause.'” Id. at 1206. However,
“courts presume that the parties intend arbitrators,
not courts, to decide disputes about the meaning and
application of particular procedural preconditions for the
use of arbitration, ” such as “waiver, delay, or
a like defense to arbitrability.” Id. at 1207.
the Court in BG Group included “waiver”
among the issues that arbitrators are presumed to decide, a
review of prior Supreme Court and First Circuit precedent
convinces this Court that the “waiver”
contemplated in BG Group is not the
litigation-conduct waiver that Plaintiffs allege in the
litigation-conduct waiver has been decided by the court, not
an arbitrator. Marie v. Allied Home Mortg. Corp.,
402 F.3d 1, 14 (1st Cir. 2005). The First Circuit was
presented with this very issue in Marie, which
predates the BG Group decision. The Marie
court grappled with two earlier Supreme Court decisions:
Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79,
(2002), and Green Tree Fin. Corp. v. Bazzle, 539
U.S. 444 (2003) (plurality opinion).
Howsam, the arbitration provision provided that a
dispute was not eligible for arbitration if more than six
years had elapsed since the event giving rise to the dispute.
537 U.S. at 82. The Court held that “condition[s]
precedent to arbitrability” and procedural questions
such as “waiver, delay, or a like defense to
arbitrability . . . are presumptively not for the
judge, but for an arbitrator, to decide.” Id.
at 84-85. The Court held that the six-year time limit was a
procedural condition precedent to arbitrability, and
therefore, a matter for the arbitrator to decide.
Id. at 84-85. In Green Tree, the parties
disputed whether their arbitration agreement permitted class
arbitration. 539 U.S. at 452. The Court held that
“[a]rbitrators are well situated to answer that
question” because it “does not concern . . .
judicial procedures, ” but rather, it “concerns
contract interpretation and arbitration procedures.”
Id. at 452-53.
Court in both Howsam and Green Tree . . .
stressed issues of comparative expertise. In the face of
contractual silence, courts should presume that parties
intend to give their disputes to the most able decisionmaker
on a given issue, both for contractual and public policy
reasons.” Marie, 402 F.3d at 10. The
Marie court also noted that “the
Howsam and Green Tree rules exist partly
‘to avoid . . . delay.'” Id. at 14
(quoting Shaw's Supermarkets, Inc. v. United Food
& Commercial Workers Union, Local 791, 321 F.3d 251,
255 (1st Cir. 2003)). Finding that the district court was in
the best position to decide issues of litigation-conduct
waiver, the Marie court held “that the Supreme
Court in Howsam and Green Tree did not
intend to disturb the traditional rule that waiver by
conduct, at least where due to litigation-related activity,
is presumptively an issue for the court.”
Marie, 402 F.3d at 14.
to Defendants' argument, BG Group simply
restates the Howsam and Green Tree rules.
Compare BG Group, 134 S.Ct. at 1207 (holding that
arbitrators presumptively decide “waiver, delay, or a
like defense to arbitrability”) with Howsam,
537 U.S. at 84 (holding that “conditions precedent to
arbitrability” and procedural questions such as
“waiver, delay, or a like defense to
arbitrability” are presumptively for an arbitrator to
decide) and Green Tree, 539 U.S. at 453 (holding
that arbitrators are well-suited to answer questions of
arbitration procedures). Nothing in BG Group
undercuts the holding in Marie, that the Supreme
Court did not intend to alter traditional rule that courts
presumptively decide issues of litigation-conduct waiver.
See Vine v. PLS Fin. Servs., Inc., 689 Fed.Appx.
800, 803 (5th Cir. 2017) (noting that “a majority of
the [circuit court] decisions addressing litigation-conduct
waiver pre-date BG Group, but the logic of those
decisions interpreting Howsam is equally applicable
to BG Group”).
foregoing reasons, the Court will decide the merits of