A federal judge from the Eastern District of Louisiana has granted the New Orleans Saints’ motion to compel arbitration in a case in which the team was sued by the former personal assistant to team owner Tom Benson for violation of the Fair Labor Standards Act (FLSA) and several state laws.
In so ruling, the court found that there was “a valid” arbitration agreement and that “no federal statute or policy” at stake in the instant litigation would undermine that agreement.
Plaintiff Rodney Henry began working for the Saints as Benson’s personal assistant for some 25 years. He ultimately became involved as a witness in litigation involving the Benson family. Gayle Benson ultimately terminated his contract on or about June 24, 2015.
He sued the Saints for violations of the FLSA, discrimination and wrongful termination. The Saints ultimately countered with a motion to compel arbitration.
The court wrote that it would “employ a two-step analysis to determine whether a party may be compelled to arbitrate. Jones v. Halliburton Co., 583 F.3d 228, 233 (5th Cir. 2009). The court first inquires whether the party has agreed to arbitrate the dispute at issue. Id. at 233-34. This question itself is further subdivided into two considerations: ‘(1) whether there is a valid agreement to arbitrate between the parties; and (2) whether the dispute in question falls within the scope of that arbitration agreement.’ Webb v. Investacorp, Inc., 89 F.3d 252, 257-58 (5th Cir. 1996).” The second step “is to determine whether any federal statute or policy renders the claims nonarbitrable.” Wash. Mut. Fin. Grp. v. Bailey, 364 F.3d 260, 263 (5th Cir. 2004).
The court noted early on that “the written agreement to arbitrate is valid and enforceable, … and that it falls within the scope of the arbitration provision. Therefore, the court will order arbitration, stay this action, and permit the arbitrator to decide whether the plaintiff’s claims against the Saints falls within the scope of the arbitration agreement.”
Next, the court sought to determine whether the plaintiff must “arbitrate his claims against Tom and Gayle Benson in accordance with the arbitration clause in the agreement (with the Saints). The plaintiff argues that Mr. and Mrs. Benson are not parties to the agreement and do not have a legal or equitable basis to compel the plaintiff to arbitrate his claims against them. The defendants argue that the Bensons can compel arbitration under principles of equitable estoppel.
“The Supreme Court has held that ‘a litigant who is not a party to an arbitration agreement may invoke arbitration under the FAA if the relevant state contract law allows the litigant to enforce the agreement. Arthur Andersen LLP v. Carlisle, 556 U.S. 624, 631, 129 S. Ct. 1896, 173 L. Ed. 2d 832 (2009).’” Under Louisiana law, the doctrine of equitable estoppel supports the position that a court may “compel arbitration between a nonsignatory defendant and a signatory plaintiff when the plaintiff raises allegations of substantially interdependent and concerted misconduct by the nonsignatory and one or more of the signatories to the agreement. See, e.g., Sturdy Built Homes, L.L.C. v. Carl E. Woodward L.L.C., 82 So. 3d 473, 478 (La. App. 4 Cir. 2011); Regions Bank v. Weber, 53 So. 3d 1284, 1291 (La. App. 4 Cir. 2010); Saavedra v. Dealmaker Devs., LLC, 8 So. 3d 758, 763 n.5 (La. App. 4 Cir. 2009). But cf. Sherwin-Williams Co. v. Culotta, 2012 La. App. Unpub. LEXIS 366, 2012 WL 1550589, at *4 (La. App. 1 Cir. 2012) (noting in dicta that the court disagreed generally with the doctrine of equitable estoppel).
“’The linchpin for equitable estoppel is equity—fairness.’ Regions Bank, 53 So. 3d at 1291 (quoting Grigson, 210 F.3d at 528).
“Here, if the plaintiff is permitted to proceed with his claims against the Bensons in court, the Saints would, in essence, become a party to the litigation because the plaintiff alleges substantially interdependent and concerted misconduct by Tom Benson, Gayle Benson, and the Saints. Furthermore, all of the plaintiff’s claims stem from his employment. The only cause of action the plaintiff asserts against Tom Benson is the FLSA claim, which the plaintiff asserts collectively against all the defendants. The plaintiff alleges that each defendant—Tom Benson, Gayle Benson, and the Saints—was his ‘employer’ under the FLSA. Therefore, the plaintiff’s FLSA claims against Tom and Gayle Benson are based on the same operative facts and are inherently inseparable from the FLSA claim against the Saints.”
Furthermore, the plaintiff’s remaining two claims against Gayle Benson, “for discrimination and retaliation under 42 U.S.C. § 1981, are asserted collectively against Mrs. Benson and the Saints. … (T)hese claims are indistinguishable from Plaintiff’s claims against the Saints for discrimination and relation under Title VII.
“Given the relatedness of the claims collectively asserted against the defendants, the arbitration agreement can be invoked by all defendants, including the Bensons. Otherwise the arbitration proceedings between the plaintiff and the Saints would be rendered meaningless and the federal policy in favor of arbitration effectively thwarted. Therefore, under the doctrine of equitable estoppel, the plaintiff must submit his claims against the Bensons to arbitration as well.”
Rodney Henry v. New Orleans Louisiana Saints L.L.C. et al; E.D.La.; CIVIL ACTION NO: 15-5971 SECTION: “J”(2), 2016 U.S. Dist. LEXIS 65535; 5/18/16
Attorneys of Record: (for plaintiff) Christopher L. Williams, LEAD ATTORNEY, Williams Litigation, LLC, New Orleans, LA. (for defendants) Leslie A. Lanusse, LEAD ATTORNEY, Gregory Fortier Rouchell, Adams & Reese, LLP (New Orleans), New Orleans, LA.
