United States District Court, D. Massachusetts
DJAMEL OUADANI, on behalf of himself and all others similarly situated, Plaintiff,
DYNAMEX OPERATIONS EAST, LLC Defendant.
MEMORANDUM AND ORDER
B. Saris Chief United States District Judge
Djamel Ouadani brings this putative class action against
Defendant, Dynamex Operations East (“Dynamex”),
alleging violations of the Fair Labor Standards Act
(“FLSA”), and the Massachusetts misclassification
and wage laws. Pending before the Court is Dynamex's
motion to compel arbitration and dismiss under the Federal
Arbitration Act (“FAA”), 9 U.S.C. §§
1-16 (2012), and Fed.R.Civ.P. 12(b)(1) (Docket No. 14). After
reviewing the parties' briefs and hearing argument, the
Court DENIES the motion to compel arbitration and
dismiss (Docket No. 14).
relevant facts are drawn from Ouadani's complaint,
exhibits to the complaint, and the Dynamex-Selwyn and Birtha
Shipping, LLC Independent Contractor Agreement, which Dynamex
filed in support of its motion. See Docket No. 15,
Ex. 1.Dynamex has not disputed any of these facts
for the purposes of evaluating its motion to compel
is a Cambridge, Massachusetts resident who responded to a
Craigslist ad that Dynamex posted seeking delivery drivers in
the Boston area. Dynamex contacted Ouadani and invited him to
a meeting at Dynamex's offices in Wilmington,
Massachusetts. Ouadani met with Dynamex employees, who
described the services that Dynamex provided for Google
Express. Ouadani also completed Dynamex paperwork (including
his availability for delivery shifts), paid for a Dynamex
t-shirt, and had his picture taken for a Dynamex ID badge.
Dynamex employees told Ouadani that he would have to
associate with one of three “Dynamex-affiliated
vendors” in order to become a driver. Ouadani
associated with Selwyn and Birtha Shipping, LLC
(“SBS”), but he never interviewed with its owner
and manager, Edward Alwis, who also worked as a Dynamex
delivery driver. Neither Dynamex nor SBS classified Ouadani
as an employee.
passed a drug test, received his Dynamex ID badge, a cell
phone and scanner set up with Google Express software, and
began performing delivery services, wearing his Dynamex shirt
all the while. Dynamex also issued Ouadani a company email
address, at which he received emails about shift scheduling,
work policies, and delivery procedures. See Docket
No. 1, Exs. 4-9. Ouadani made pickups and deliveries across
greater Boston. SBS paid Ouadani an amount the former
described as its payment from Dynamex less a 17.5 percent
deduction, which SBS attributed to taxes and insurance. On
August 22, 2016, Ouadani complained to Dynamex that he did
not have the independence of a contractor and that he should
be paid as an employee. The next day, Ouadani was permanently
removed from the driver schedule, resulting in his
three months before Ouadani's interview with Dynamex,
Alwis, on behalf of SBS, signed a contract with Dynamex. That
contract governed the relationship between SBS and Dynamex at
all relevant times. Included in that agreement was an
obligation that SBS “furnish at its own discretion,
selection, and expense any and all Personnel required,
necessary or incidental to [SBS]'s performance” of
contracted services. Docket No. 15, Ex. 1, at ¶ 6(b)(i).
SBS was responsible for paying its employees for work
performed in relation to the Dynamex-SBS independent
contractor agreement. Id.
Dynamex-SBS independent contractor agreement included a
sweeping arbitration provision governed by the FAA. The
arbitration clause covers disputes brought by SBS, Dynamex,
“or any agent acting on behalf of either.”
Id. at ¶ 16(a)(i). The provision explicitly
subjects to arbitration “disputes regarding any city,
county, state or federal wage-hour law.” Id.
The Road to Arbitration
enacted the FAA in 1925 in “response to hostility of
American courts to the enforcement of arbitration agreements,
a judicial disposition inherited from then-longstanding
English practice.” Circuit City Stores, Inc. v.
Adams, 532 U.S. 105, 111 (2001). To give effect to this
purpose, section 2 of the FAA provides that written
arbitration agreements “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 (2012); see also Circuit City, 532 U.S. at
111. In short, section 2 “is a congressional
declaration of a liberal federal policy favoring arbitration
agreements.” Moses H. Cone Mem'l Hosp. v.
Mercury Constr. Corp., 460 U.S. 1, 24 (1983). “At
a minimum, this policy requires that ambiguities as to the
scope of the arbitration clause itself must be resolved in
favor of arbitration.” PowerShare, Inc. v. Syntel,
Inc., 597 F.3d 10, 15 (1st Cir. 2010).
cases where the applicability of the arbitration provision is
unclear either in terms of scope or whether one or more
parties is bound by the agreement, courts conduct additional
inquiry. “[A]rbitration is a matter of contract and a
party cannot be required to submit to arbitration any dispute
which he has not agreed so to submit.” AT & T
Techs., Inc. v. Commc'ns Workers of Am., 475 U.S.
643, 648 (1986) (quoting United Steelworkers of Am. v.
Warrior & Gulf Navig. Co., 363 U.S. 574, 582
(1960)). The party seeking to compel arbitration must
“demonstrate  that a valid agreement to arbitrate
exists,  that the movant is entitled to invoke the
arbitration clause,  that the other party is bound by that
clause, and  that the claim asserted comes within the
clause's scope.” Soto-Fonalledas v.
Ritz-Carlton San Juan Hotel Spa & Casino, 640 F.3d
471, 474 (1st Cir. 2011); see also McCarthy v.
Azure, 22 F.3d 351, 354-55 (1st Cir. 1994). Regarding
the third prong, “courts should be extremely cautious
about forcing arbitration in situations in which the identity
of the parties who have agreed to arbitrate is
unclear.” InterGen N.V. v. Grina, 344 F.3d
134, 143 (1st Cir. 2003).
one of the parties to a dispute is not a signatory to the
contract containing the arbitration clause, there are
typically five bases for requiring nonsignatories to
arbitrate: “1) incorporation by reference; 2)
assumption; 3) agency; 4) veil-piercing/alter ego; and 5)
estoppel.” Thomson-CSF, S.A. v. Am. Arbitration
Ass'n, 64 F.3d 773, 776 (2d Cir. 1995). Two such