PARADISE HOGAN, on behalf of himself and all others similarly situated, Plaintiff, Appellee,
SPAR GROUP, INC., Defendant, Appellant, SPAR BUSINESS SERVICES, INC., Defendant.
FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF
MASSACHUSETTS [Hon. Leo T. Sorokin, U.S. District Judge]
M. Nicholas, with whom Jillian M. Collins and Foley &
Lardner LLP were on brief, for appellant.
S. Lane, with whom Hillary Schwab and Fair Work, P.C. were on
brief, for appellee.
Torruella, Kayatta, and Barron, Circuit Judges.
TORRUELLA, Circuit Judge
Group, Inc. ("SPAR") appeals from the district
court's denial of its motion to compel arbitration. SPAR,
a retail services provider, obtains most of its personnel
from a staffing company named SPAR Business Services, Inc.
("SBS"). SBS engaged plaintiff-appellee Paradise
Hogan ("Hogan") as an independent contractor and
assigned him to perform services for SPAR. Hogan and SBS
entered into an "Independent Contractor Master
Agreement" to which SPAR was not a party. Subsequently,
Hogan sued SBS and SPAR, and both sought to compel
arbitration invoking an arbitration clause in the Independent
Contractor Master Agreement. The district court compelled
arbitration as to Hogan's claims against SBS, but found
that SPAR had no legal basis to compel Hogan to arbitration.
appealed, pressing two alternate theories for why it can
compel Hogan to arbitrate despite not being a party to the
agreement containing the arbitration clause. A review of the
facts here mandates the conclusion that "the obvious bar
to arbitrability is the abecedarian tenet that a party cannot
be forced to arbitrate if it has not agreed to do so."
InterGen N.V. v. Grina, 344 F.3d 134, 137 (1st Cir.
2003). We affirm.
SPAR's request "to compel arbitration was made in
connection with a motion to dismiss or stay, we draw the
relevant facts from the operative complaint and the documents
submitted to the district court in support of the motion to
compel arbitration." Cullinane v. Uber Techs.,
Inc., 893 F.3d 53, 55 (1st Cir. 2018).
a staffing company that provides personnel to various retail
services providers, including SPAR. SPAR executes field
merchandising, auditing, and assembly services for retailers
through personnel referred to as "Field
Specialists," substantially all of whom are supplied by
SBS. SBS is "affiliate[d]" to SPAR "but is not
a subsidiary of or controlled by SPAR." SBS classifies
the Field Specialists it provides to SPAR as independent
Hogan entered into an "Independent Contractor Master
Agreement" (the "Master Agreement") with SBS,
which SBS requires all Field Specialists to
sign. Paragraph twenty of the Master Agreement
requires its parties to resolve disputes through arbitration:
Any dispute between the Parties relating to this Master
Agreement or otherwise arising out of their relationship
under its terms, including but not limited to any disputes
over rights provided by federal, state, or local statutes,
regulations, ordinances, and/or common law, shall be
determined by arbitration. . . . The Parties acknowledge the
Master Agreement evidences a transaction involving interstate
commerce, and the arbitration shall be governed by the United
States Federal Arbitration Act (9 U.S.C., Sections 1-16)
Paragraph twenty of the Master Agreement also states that
"[t]he Parties agree that any claim shall be brought
solely in the individual capacity of SBS or the Independent
Contractor, and not as a representative of any other persons
or any class." SPAR is not a party to the Master
about May 2015, SBS assigned Hogan to perform Field
Specialist duties for SPAR. Neither SBS nor SPAR reimbursed
Hogan or other Field Specialists for costs or expenses
incurred in the performance of their assignments. While SBS
required Hogan and other Field Specialists to acquire general
liability and workers' compensation insurance, neither
SBS nor SPAR paid for or contributed to these expenses.
Hogan's regular hourly rate for performing services as a
Field Specialist was minimum wage.
B. Procedural Background
January 6, 2017, Hogan filed a putative class action
complaint against both SBS and SPAR essentially alleging that
they misclassified him and other Field Specialists as
independent contractors rather than employees, such that they
avoid paying mandated expenses and cause them to earn less
than minimum wage. Hogan asserted various causes of action,
including breach of contract, unjust enrichment, and
violations to the Fair Labor Standards Act and Massachusetts
wage and hour statutes.
2, 2017, after SBS and SPAR moved to compel arbitration or
dismiss for failure to state a claim, Hogan requested to
amend the complaint to "narrow the scope of his
claims." The district court allowed Hogan's request
and denied as moot defendants' motion to compel
arbitration. On May 17, 2017, Hogan filed
"Plaintiff's First Amended Class Action Complaint
and Demand for Jury Trial" (the "Amended
Complaint"), abandoning all but his claims pursuant to
the Massachusetts Wage Act, Mass. Gen. Laws ch. ...