Joia v. Jozon Enterprises, Inc.

          REPORT AND RECOMMENDATION

          Patricia A. Sullivan United States Magistrate Judge

         Plaintiff Emanuel Joia, pro se, ^[1] initiated this case against his former employer, Defendant Jozon Enterprises, Inc., by filing a Petition to Compel Arbitration pursuant to § 4 of the Federal Arbitration Act (“FAA”), 9 U.S.C. § 4. ECF No. 17.^[2] In his Petition, Plaintiff asks the Court to “issue an order, pursuant to Section 4 of the Federal Arbitration Act, compelling the arbitration of all claims in the Complaint[, ]” as required by an arbitration agreement signed by the parties and dated April 11, 2017 (“Arbitration Agreement”).^[3] ECF No. 17 at 19, 23-28. Defendant objected to the Petition, arguing that Plaintiff is not a party aggrieved by a refusal to arbitrate, as the FAA mandates, because Plaintiff has failed to initiate arbitration pursuant to the terms of the Arbitration Agreement, which is a prerequisite to Defendant's duty to arbitrate. ECF No. 30 at 2. According to Defendant, it has not refused to arbitrate and stands ready, willing and able to do so, if an arbitration is initiated by Plaintiff under the Arbitration Agreement.

         In light of the apparent confluence of the parties' positions, a Rule 16 conference was promptly held. During the conference, the parties confirmed that the Arbitration Agreement is a true copy of the controlling agreement between them, that Plaintiff has not initiated arbitration pursuant to the rules of the American Arbitration Association (“AAA”) as required by the Arbitration Agreement and that Defendant acknowledges and intends to abide by its contractual duty to arbitrate. At the conference, based on its continuing duty to inquire as to its subject matter jurisdiction, even absent a motion, McCulloch v. Velez, 364 F.3d 1, 5 (1st Cir. 2004), Behroozi v. Behroozi, C.A. No. 15-536S, 2016 WL 8461181, at *1 (D.R.I. Nov. 22, 2016), adopted, 2017 WL 933059 (D.R.I. Mar. 8, 2017), the Court advised the parties that it was concerned about jurisdiction and would engage in a sua sponte analysis of whether this case should be dismissed for lack of jurisdiction.^[4] See ECF No. 44 at 2 (noting open question regarding Court's jurisdiction). Based on the analysis that follows, I now recommend that the case be dismissed because the Court has neither statutory nor constitutional subject matter jurisdiction.

         I. Background^[5]

         According to the materials attached to the Petition, Plaintiff worked for Defendant as a delivery driver with Domino's Pizza for approximately five months until September 2017. ECF No. 17 at 13-14, 38, 47. In April 2017, presumably at the initiation of Plaintiff's employment with Domino's Pizza, the parties executed the Arbitration Agreement. Id. at 11, 23-28.

         The Arbitration Agreement provides that “all claims, disputes, and controversies” that either Plaintiff or Defendant may have against the other, including any that “arise out of the employment context[, ]” must be resolved by binding arbitration. Id. at 23. More specifically, it provides that any disputes related to Plaintiff's “job application, hiring, terms and conditions of employment, job assignments, payment of wages, benefits, forms of compensation, or termination[, ]” including claims of employment discrimination arising under state or federal law, must be “submitted to and determined exclusively by binding arbitration under the [FAA].” Id. at 23-24 (§ I-II). The Agreement requires that any such arbitration must be conducted pursuant to the AAA rules. Id. at 25 (§ III). And, if it is the employee who is aggrieved, he/she must initiate arbitration using the procedure set by the AAA rules. Id. at 25-26 (§ III). While the Agreement requires that the party requesting arbitration must pay the AAA filing fee, the AAA rules referenced in the Agreement provide for an “Administrative Fees Hardship Waiver, ” which contemplates a deferment, reduction or waiver of the filing fee for an individual who cannot afford the fee.^[6] ECF No. 40-1 at 28, 52-53. Otherwise, the Arbitration Agreement provides that the arbitrator's fees and the other expenses imposed by AAA are borne by Defendant. ECF No. 17 at 26 (§ III F). The Arbitration Agreement includes the stipulation that the duty to arbitrate survives the termination of the employment relationship. Id. at 23.

         When Plaintiff terminated his employment with Domino's Pizza in September 2017, he explained the reasons for his resignation in a letter dated September 9, 2017:

I do not fit the company persona and am finding it difficult to conform to the environment as well as the requirements of the job. I am late frequently because I am always caught up in traffic. I have had issues with co-workers, on more than one occasion, and I can't seem to fit the team persona. It would be best that I remove myself from this environment before it becomes more problematic.

Id. at 47. After he resigned, Plaintiff's application for unemployment benefits was denied by a referee who found that Plaintiff left work voluntarily without good cause in that there was no evidence of workplace harassment and no evidence that Plaintiff was inappropriately denied access to his paystub. Id. at 38-44. The record does not disclose whether Plaintiff appealed this decision.

         As revealed by the attachments to the Petition, in July 2017, Plaintiff filed a complaint with the Rhode Island Commission for Human Rights alleging that he was “harassed verbally by the entire staff, ” including that other employees sabotaged his work; that he was discriminated against by the refusal to give him paystubs and other actions such as putting “some Viagra like substance in my food”; and that he believed he was “being surveilled” outside of work. Id. at 45-46. Also in July 2017, he made a complaint to the Rhode Island Department of Labor and Training that he did not get a paystub and that “my employer is following me and surveilling me outside of work.” Id. at 48. Beginning in September 2017, he filed complaints in the Rhode Island District and Superior Courts.^[7] These allege that Defendant did not comply with the wage-notice-posting requirements in 29 C.F.R. § 516.4 and R.I. Gen. Laws § 28-12-11, that Plaintiff was harassed in that “coworkers and managers collaborated in fracas to influence the plaintiff to quit in turn diminishing the plaintiffs' wages, ” and that Defendant sabotaged Plaintiff's “efforts to earn unemployment benefits.” ECF No. 17 at 29-30.

         According to Plaintiff's Petition, and confirmed by Defendant at the Rule 16 conference, as well as by the electronically accessible public docket of the Superior Court, Plaintiff's Superior Court claims were dismissed based on the Arbitration Agreement. As Plaintiff's Petition represents, the Superior Court considered but rejected Plaintiff's argument that his resignation letter voided the Arbitration Agreement.^[8] No. appeal was taken from this decision.

         After the Superior Court's decision became final, instead of initiating arbitration with AAA, on July 2, 2018, Plaintiff filed the pending Petition to Compel Arbitration in this Court. In it, he petitions this Court to compel Defendant to arbitrate the following claims: that Defendant violated 29 C.F.R. § 516.4 and R.I. Gen. Laws § 28-12-11 (wage posting requirements); that Defendant engaged in “collective sabotage for unjust enrichment[, ]” assault, intentional infliction of emotional distress, negligence and malice; and that Defendant “falsified evidence that would lead to the denial of the plaintiff's unemployment insurance, ultimately resulting in the denial of benefits.” ECF No. 17 at 1-2. In a supplement to the Petition, Plaintiff mentions “FLSA” and references state law claims based on “Rhode Island's Fair Labor Standard Act” and “RI General Assembly Statement of Earnings requirements.” Id. at 15. These references are based on the allegation that Defendant failed to supply Plaintiff with a paystub.

         The prayer for relief in the Petition's supplement asks the Court to compel arbitration of all of these claims pursuant to FAA. Id. at 19. Plaintiff asks the Court to select and appoint the arbitrator, citing 9 U.S.C. § 5 as the foundation for the request.^[9] In addition, the Petition asks the Court to summon the witnesses to the arbitration, citing 9 U.S.C. § 7.^[10]

         According to the Petition, Plaintiff resides in Rhode Island and Defendant's principal place of business is in Rhode Island. ECF No. 17 at 1, 13-14. Plaintiff asserts federal question jurisdiction based on the FAA. Id. at 1 (citing 9 U.S.C. § 4). The Petition does not request a jury trial. Id.

         In Defendant's objection to the Petition, it agrees that the parties have a valid agreement to arbitrate. It objects to the Petition only in that it alleges that it has never refused to arbitrate Plaintiff's claims under the Arbitration Agreement. ECF No. 30. At the Rule 16 conference held on January 23, 2019, Defendant further confirmed that the Arbitration Agreement is a binding contract between the parties and represented that it would submit to arbitration if Plaintiff initiates it under the terms of the Arbitration Agreement.

         In response, Plaintiff conceded that he had not initiated AAA arbitration. He stated that he feared he would be unable to afford the filing fee^[11] and that the AAA “will assume a conflict of interest, as the respondent [sic] has no trust in the client of the counsel.” ECF No. 41 at 1. Those fears are why he filed the Petition in this Court, believing that the filing complies with his contractual duty to arbitrate and protects him by involving the Court (which granted him in forma pauperis status for this case) in the arbitration process. Ultimately, Plaintiff represented that he understands arbitration is mandatory pursuant to the Arbitration Agreement; he does not seek to relitigate the state court decision that the Arbitration Agreement is ...