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Perez-Tejada v. Mattress Firm Inc.

United States District Court, D. Massachusetts

February 21, 2019



          Denise J. Casper United States District Judge.

         I. Introduction

         Plaintiffs Mack Perez-Tejada (“Perez-Tejada”), Roger Ricks II (“Ricks”), Roy McElroy (“McElroy”), Ashraf Meshriky (“Meshriky”), Ezenwa Onukwue (“Onukwue”), Robert LaMantia (“LaMantia”) Bryce Williamson (“Williamson”) and Mark A. Turner[1] (collectively, “Plaintiffs”)[2]bring this class action on behalf of themselves and all others similarly situated against Defendants Mattress Firm, Inc. (“Mattress Firm”), Kenneth Murphy (“Murphy”) and Jim Black (“Black”) (collectively, “Defendants”). Plaintiffs assert claims for unpaid overtime wages pursuant to the Fair Labor Standards Act (“FLSA”), Massachusetts wage law, Mass. Gen. L., c. 151 § 1A-1B and New York Labor Law, Art. 19, § 650. Defendants have moved to compel individual arbitration and for a stay of the court proceedings pursuant to the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., on the grounds that the dispute is covered by an arbitration agreement. D. 36, 48. The Court ALLOWS the Defendants’ amended motion to compel individual arbitration and stay of these proceedings. D. 36, 48.

         II. Standard of Review

         When ruling on a motion to compel arbitration, courts should “draw [upon] the relevant facts from the operative complaint and the documents submitted [] in support of the motion to compel arbitration.” Cullinane v. Uber Techs., Inc., 893 F.3d 53, 55 (1st Cir. 2018). Courts have consistently applied a summary judgment standard, prompting courts to “consider facts in the light most favorable to the [non-movant] . . . and exercise its ‘wide discretion’ to look beyond the complaint at pleadings and documents submitted by either party.” Boulet v. Bangor Sec. Inc., 324 F. Supp. 2d 120, 123 (D. Me. 2004) (quoting Anderson v. Delta Funding Corp., 316 F. Supp. 2d 554, 558 (N.D. Ohio 2004) (internal quotation marks omitted)).

         III. Relevant Facts

         The following facts are undisputed unless otherwise noted.

         Mattress Firm is a nationwide mattress retail chain. D. 11 ¶ 15. It employs approximately 7,000 sales associates across the United States, including Massachusetts and New York. Id. ¶¶ 16, 29, 37. Defendant Murphy is the President and Director of Mattress Firm, id. ¶ 10, and Defendant Black is the Treasurer, id. ¶ 11. Plaintiffs worked as “inside sales” employees for Mattress Firm at all relevant times. Id. ¶ 19. Specifically, Plaintiffs sold products to Mattress Firm customers at its retail stores. Id. ¶ 20. As alleged, Plaintiffs worked more than forty hours a week and did not receive overtime pay. Id. ¶ ¶ 67, 73, 77, 81. Plaintiffs were all managers-on-duty, which is an entry-level sales position. D. 37-1 ¶¶ 4-7, 9-11.

         On March 23, 2016, an email from Human Resources was sent to all Mattress Firm employees. D. 37-1 at 6-7. This email contained a copy of the Mutual Arbitration Agreement (the “Agreement”) and requested that the employees first watch a video on “MFRMtv” explaining the significance of the Agreement and thereafter either execute electronically via DocuSign or complete the opt-out process. Id. at 6. The Agreement states in relevant part:

Arbitration. . . . both Mattress Firm [] and you agree to resolve any and all claims, disputes, or controversies arising out of or relating to your application for employment, your employment with the Company and/or the termination of your employment exclusively by arbitration to be administered by a neutral arbitration agency to be agreed upon by the parties. . . .
Covered Claims. Some, but not all, of the types of claims covered are: unpaid wages, overtimes or other compensation. . . You and the company agree that the parties are subject to the Federal Arbitration Act (“FAA”) and that this Agreement shall be enforceable pursuant to and interpreted in accordance with the FAA.
Class Action, Collective Action and Representative Action Waiver. . . . All claims covered by this Agreement are intended to be brought and resolved on an individual basis. Both you and the Company are waiving any right to bring claims as class, collective, or representative actions.
Arbitrability. The Arbitrator, and not any federal, state, or local court or agency, shall have the exclusive authority to resolve any dispute relating to the interpretations, applicability, enforceability, or formation of this Agreement. . . .
The Parties. For the purposes of the scope of the obligation to arbitrate, claims against the “Company” shall include claims against all parent and subsidiary and related companies, specifically including, but not limited to Mattress Firm [] and the Sleep Train, Inc., as well as their respective officers, directors, managers, supervisors, employees (current and former) . . . .

D. 37-2 at 2-14.

         Employees had the choice of opting-out of the Agreement by requesting an “Opt Out form” via the email address listed in the body of the email. D. 37-1 at 6. Employees were required to return this form no later than April 23, 2016. Id. The March 23 email also indicated that clicking the “Decline to Sign” option within DocuSign “was not a valid option for the fulfillment of [the Agreement].” Id. Finally, the employees were urged to contact a human resources representative or manager with any questions. Id. at 7. The same email was sent again two days later on March 25, 2016. Id. at 12-13. On April 11, 2016, Mattress Firm circulated another email to all employees with a link to view the video explaining the arbitration program. Id. at 9-10. Additionally, the email indicated that “[a]rbitration [] [i]s an alternative to litigation in the courts” and that “it works like a less formal version of a lawsuit that is decided by an impartial arbitrator instead of judge and a jury.” Id. at 10. Diane Penoyer-Hanratty, the Human Resources Director at Mattress Firm, attested that “associates also received almost daily reminders via email to review and sign the [Agreement] or exercise their right to opt out.” Id. at 2 ΒΆ 3. She ...

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