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Britto v. St. Joseph Health Services of Rhode Island

United States District Court, D. Rhode Island

April 23, 2018

SYLVESTER J. BRITTO, JR., Plaintiff,
v.
ST. JOSEPH HEALTH SERVICES OF RHODE ISLAND, alias; PROSPECT CHARTERCARE SJHSRI, LLC, alias; PROSPECT CHARTERCARE, LLC, alias; SANDRA NASTARI, alias; and ADDY KANE, alias, Defendants.

          MEMORANDUM AND ORDER

          WILLIAM E. SMITH, CHIEF JUDGE

         This case arises from Sylvester J. Britto's (“Plaintiff”) suit against his former employers for damages stemming from their alleged violations of the Age Discrimination in Employment Act, 29 U.S.C. §§ 621, et seq. (“ADEA”), Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e, et seq. (“Title VII”), the Rhode Island Fair Employment Practices Act, R.I. Gen. Laws §§ 28-5-1, et seq. (“FEPA”), and the Rhode Island Civil Rights Act, R.I. Gen. Laws §§ 42-112-1, et seq. (“RICRA”). Before the Court is Defendants Prospect CharterCare, LLC, Prospect CharterCare SJHSRI, [1] LLC, Sandra Nastari, and Addy Kane's (collectively, “Defendants”) Motion To Dismiss Proceedings and Compel Arbitration (“Motion”). (ECF No. 17). For the reasons set forth below, the Motion is GRANTED.

         I. Background

         Roger Williams Medical Center (“RWMC”) hired Plaintiff in March of 1987. (Pl.'s Mem. in Supp. of Obj. to Defs.' Mot. (“Pl.'s Mem.”) 2, ECF No. 23-1.) In 2014, Prospect purchased RWMC and became Plaintiff's employer. (Id. at 2-3.) During the transition, Prospect gave Plaintiff an Offer Letter (“Offer Letter”), Arbitration Agreement (“Agreement”), and the Company's Code of Conduct (“Code of Conduct”). (Mem. in Supp. of Defs.' Mot. (“Defs.' Mem.”) 2-3, ECF No. 17-1; Pl.'s Mem. 3.) As a required condition of employment, Plaintiff signed and returned each form. (Pl.'s Mem. 4.) This case arises from the termination of Plaintiff's employment in January 2015, about which he alleges violations of the ADEA, Title VII, FEPA, and RICRA. (Compl. 3, ECF No. 1.)

         II. Legal Standard

         This Court applies a summary-judgment standard to a motion to compel arbitration. See Proulx v. Brookdale Living Communities Inc., 88 F.Supp.3d 27, 29 (D.R.I. 2015) (“While the First Circuit has not yet addressed the issue, other courts have applied a summary judgment standard to a motion to compel arbitration.”); see also, e.g., Par-Knit Mills, Inc. v. Stockbridge Fabrics Co., 636 F.2d 51, 54 & n.9 (3d Cir. 1980); Ouadani v. Dynamex Operations E., LLC, No. CV 16-12036-PBS, 2017 WL 1948522, at *1 n.2 (D. Mass. May 10, 2017); Boulet v. Bangor Securities, Inc., 324 F.Supp.2d 120, 123-124 (D. Me. 2004). The Court reviews the evidence in the light most favorable to - and drawing all reasonable inferences in favor of - the nonmoving party. Cadle Co. v. Hayes, 116 F.3d 957, 959 (1st Cir. 1997).

         III. Discussion

         The Federal Arbitration Act (“FAA”) governs written arbitration agreements. See 9 U.S.C. § 2. Under the FAA, an arbitration agreement must be enforced where a valid, written agreement exists and the claims are made within its scope; indeed, “any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration.” Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983). The “liberal federal policy favoring arbitration agreements, ” id. at 24, requires that the Court “rigorously enforce agreements to arbitrate, ” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 221 (1985).

         A court must determine whether the party seeking to compel arbitration can show that “[(1)] a valid agreement to arbitrate exists, [(2)] that the movant is entitled to invoke the arbitration clause, [(3)] that the other party is bound by that clause, and [(4)] that the claim asserted comes within the clauses' scope.” Dialysis Access Ctr., LLC v. RMS Lifeline, Inc., 638 F.3d 367, 375 (1st Cir. 2011) (quoting InterGen N.V. v. Grina, 344 F.3d 134, 142 (1st Cir. 2003)).

         Whether a valid arbitration agreement exists is a question of state contract law. See Campbell v. Gen. Dynamics Gov't Sys. Corp., 407 F.3d 546, 552 (1st Cir. 2005). In Rhode Island, a valid contract requires “competent parties, subject matter, a legal consideration, mutuality of agreement, and mutuality of obligation.” Voccola v. Forte, 139 A.3d 404, 414 (R.I. 2016) (quoting DeLuca v. City of Cranston, 22 A.3d 382, 384 (R.I. 2011) (mem.)). Rhode Island uses the “bargained-for exchange test” for evaluating consideration, which “consists of ‘some legal right acquired by the promisor in consideration of his promise, or forborne by the promisee in consideration of such promise.'” DeAngelis v. DeAngelis, 923 A.2d 1274, 1279 (R.I. 2007) (quoting Darcey v. Darcey, 71 A. 595, 597 (R.I. 1909)). Something is bargained for if “it is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise.” Id. (quoting Filippi v. Filippi, 818 A.2d 608, 624 (R.I. 2003)). The mutuality of obligation is destroyed, however, where one of the promises exchanged is illusory, i.e., “when the promised act is conditional on the occurrence of a future event within the control of the promisor.” Crellin Techs., Inc. v. Equipmentlease Corp., 18 F.3d 1, 8 (1st Cir. 1994); see also Wells Fargo Bank, N.A. v. Wasserman, 893 F.Supp.2d 310, 317 (D.R.I. 2012).

         This Court must decide whether there is a valid and enforceable arbitration agreement. Defendants rely on an executed Agreement signed by Plaintiff in 2014. (Defs.' Mem. Ex. 1 at 5, ECF No. 17-2.) The Agreement's language requires that “any controversy, claim or dispute between [Plaintiff] and [Prospect] . . . relating to or arising out of [Plaintiff's] employment or the cessation of that employment will be submitted to final and binding arbitration.” (Id.) The Agreement covers “all employment-related claims including, but not limited to, claims for unpaid wages, breach of contracts, torts, violation of public policy, discrimination, harassment, or any other employment-related claim under any state or federal statutes or laws relating to an employee's relationship with his/her employer.” (Id.) And it concludes with the pronouncement that, “[b]y agreeing to this binding mutual arbitration provision, both [Plaintiff] and [Prospect] give up all rights to a trial by jury.” (Id.)

         A. Mutual Promise To Arbitrate

         Complicating matters here, the Offer Letter reserved Defendants' right to “change the terms of [Plaintiff's] employment . . . at any time.” (Offer Letter, id. at 8.) Neither the First Circuit nor the Rhode Island Supreme Court has addressed whether language that reserves the right to an employer to unilaterally change the terms and conditions of employment renders an arbitration agreement illusory and therefore invalid. To suggest that it does, Plaintiff cites a recent decision from this district, Conduragis v. Prospect CharterCare, LLC, C.A. No. 17-272-JJM-PAS, 2017 WL 5997417 (D.R.I. Dec. 1, 2017). There, the court broadly construed an arbitration agreement and the offer letter together, in part because it determined that the arbitration agreement was a term of employment, as referenced in the offer letter, and was never meant to be read alone. Id. at *3. To this end, the offer letter's language allowed Prospect to “change the terms of [Mr. Conduragis'] employment . . . at any time, ” which the court held rendered the mutual promise to arbitrate illusory and unenforceable. Id. The court also deemed continued employment insufficient consideration. Id.

         In concluding that the mutual promise to arbitrate was illusory, Judge McConnell cited cases in which courts refused to enforce agreements where “employers embed[ded] arbitration agreements in employee handbooks, reserving the right to alter any term of the handbook.” Id. at *3 (first citing Domenichetti v. Salter Sch., LLC, No. 12-11311-FDS, 2013 WL 1748402, at *6-7 (D. Mass. Apr. 19, 2013); then citing Canales v. Univ. of Phx., Inc., 854 F.Supp.2d 119, 124-25 (D. Me. 2012); and then citing Carey v. 24 Hour Fitness, USA, Inc., 669 F.3d 202, 206 (5th Cir. 2012)). One such case was Domenichetti, in which the court deemed an arbitration agreement that appeared “within the body of the [employee] [h]andbook” illusory because it neither appeared on a separate page nor required an additional signature. 2013 WL 1748402, at *6. With nothing to distinguish the handbook from the agreement, the court read them as one. Id. Notably, however, the court ...


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