United States District Court, Southern District of New York
September 30, 2002
JEFFREY SMITH, PLAINTIFF,
PROFESSIONAL SECURITY BUREAU, DEFENDANT.
The opinion of the court was delivered by: VICTOR Marrero, United States District Judge.
Plaintiff Jeffery Smith ("Smith") filed this action, then pro se, with
the pro se office on November 15, 2001. The matter was not assigned a
docket number until January 15, 2002. By Order, dated April 22, 2002, the
Court reminded Smith of his obligation to serve Defendant Professional
Security Bureau ("PSB"). Service on PSB was effected on April 23, 2002.
On May 24, 2002, PSB filed a motion to dismiss and served it on Smith.
PSB served another copy on Smith's counsel, who made an appearance at the
initial conference before the Court on June 10, 2002. Smith did not file
any opposition papers or otherwise appear in the case until after the
Court reminded him of the long-past due date by Order, dated September
17, 2002. At that time, Smith, by counsel, requested a one week extension
to oppose the motion, which the Court granted. (See Order, dated
September 20, 2002.)
A district court may grant a motion to dismiss pursuant to
Fed.R.Civ.P. 12(b)(6) only if it appears beyond doubt that the non-moving
party could prove no set of facts that would entitle it to relief. See
Valmonte v. Bane, 18 F.3d 992, 998 (2d Cir. 1994). In reviewing the
pleadings, the court must accept the non-moving party's allegations as
true. See Hishon v. King & Spalding, 467 U.S. 69, 73 (1984)
Furthermore, a court may consider documents attached to the complaint as
exhibits, or incorporated by reference, as well as any documents that are
integral to, or explicitly referenced in, the pleading. See I. Meyer
Pincus & Associates, Inc. v. Oppenheimer & Co., Inc., 936 F.2d 759,
762 (2d Cir. 1991); 2 Broadway LLC v. Credit Suisse First Boston, No. 00
Civ. 5773, 2001 WL 410074, *5 (S.D.N.Y. Apr. 20, 2001).
Here, PSB introduced the Employment Agreement it entered with Smith.
Smith did not attach than document to his complaint, nor did he expressly
refer to it in his complaint. However, it is integral to the complaint
because it forms the basis of the relationship between the parties.
Furthermore, Smith relied upon its terms in his opposition to the
motion. Accordingly, the Court considers the Employment Agreement in its
The Federal Arbitration Act manifests a "liberal federal policy
favoring arbitration agreements." Gilmer v. Interstate/Johnson Lane
Corp., 500 U.S. 20, 25 (1991) (internal quotations and citations
omitted). As such, an agreement to arbitrate should be enforced, provided
that no congressional "intention to preclude a waiver of judicial
remedies" exists. Id. at 26 (internal quotations and citations omitted);
see also Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 221 (1985)
(federal policy requires that courts "rigorously enforce agreements to
arbitrate."). The Second Circuit has held that Title VII of the Civil
Rights Act of 1964, as codified at 42 U.S.C. § 2000e to 2000e-17,
("Title VII") does not preclude mandatory arbitration clauses in
individually executed contracts. See Desiderio v. National Ass'n of
Securiteis Dealers, Inc., 191 F.3d 198, 203-06 (2d Cir. 1999). Smith does
not, and indeed could not, argue that arbitration is precluded in this
In determining whether a dispute falls within the scope of a valid
arbitration clause, a strong federal policy recommends
arbitration clauses broadly. See Marcus v. Masucci, 118 F. Supp.2d 453,
455 (S.D.N.Y. 2000) (citing AT&T Technologies, Inc. v. Communications
Workers of America, 475 U.S. 643, 650 (1986); S.A. Mineracao da
Trindade-Samitri v. Utah International, Inc., 745 F.2d 190, 194 (2d Cir.
1984); Threlkeld v. Metallgesellschaft Limited, 923 F.2d 245, 250-51 (2d
The Complaint alleges that Smith was discriminated and retahated
against on the basis of race and religion in violation of Title VII while
employed at PSB during 1999 and 2000. PSB's motion to dismiss is based on
the employment agreement between PSB and Smith, providing that:
In consideration of this Agreement, in the event that
Employee seeks relief in any agency or court of competent
jurisdiction for any dispute covered by this Agreement,
or his prior employment with the Company, or alleges any
other claim of violation of law, including claims of
discrimination or violation of public policy, the Company
may, at any time within 90 days of the service of
Employee's complaint upon the Company, at its sole
option, require all or part of the dispute to be
arbitrated by one arbitrator in accordance with the rules
of the American Arbitration Association.
(At Will Employment Agreement and General Release, dated January 29, 1999
("Employment Agreement"), at ¶ 16, attached as Ex. B to the
Declaration of Mary T. Hart in Support of Defendant's Motion to Dismiss.)
Thus, by filing a Rule 12(b)(6) motion to dismiss, PSR seeks to
effectuate the arbitration provision of the Employment Agreement.
The broad language of the arbitration provision encompasses Smith's
Title VII claims because they arise out of the employment relationship
established under the Employment Agreement. Further, because Title VII
claims may be subject to mandatory arbitration provisions, the Employment
Agreement arbitration provision is valid.
The record in this matter reflects that PSB filed a motion to dismiss,
seeking that the matter be sent to arbitration, well within 90 days of
being served with the complaint. Accordingly, PSB exercised its right to
mandatory arbitration, which the Court should respect.
Smith opposes the motion on three grounds. First, Smith contends that
PSR's 90-day election period began when Smith served PSB with the
complaint he filed with the EEOC, and only then. But, the Employment
Agreement does not state the PSB has only one election period. Rather,
the contractual language is that PSB has 90 days from service of a
complaint filed in "any agency or court of competent jurisdiction for any
dispute covered by this Agreement." (Id.) The Employment Agreement
provides no support for the proposition that because PSB chose not to
elect arbitration of the EEOC complaint, PSB prejudiced its right should
Smith file subsequent complaints with other agencies or courts. The Court
will not read the requested limitation into the Employment Agreement.
Here, PSB had two opportunities to elect arbitration: first when Smith
filed with the EEOC; and second when Smith filed with this Court.
Accordingly, the Court rejects Smith's first argument.
Second, Smith argues that PSB's motion was filed after the 90-day
election period had elapsed. Smith's second argument is inconsistent with
the Employment Agreement's express terms providing that the election
period begins when PSB is served, and which Smith quoted in the previous
paragraph of his letter. (See Letter to the Court from Warren Randolph
Kraft, dated September 27, 2002 (the "Kraft Letter"), at 1 ("within 90
days upon the service of
Employee's Complaint upon the company . . . ")
(emphasis in original).) Here, PSB filed its motion approximately 30 days
after it was served. Thus, PSB exercised its right to send the matter to
arbitration in a timely manner, and Smith's second argument fails.
Third, Smith argues that the arbitration provision "was included as
part of a general release relating to previous claims between the parties
in resolution of their previous dispute." (Kraft Letter, at 2.) This
argument also misconstrues the Employment Agreement. Although the
Employment Agreement appears to serve two purposes — an at will
employment agreement and a general release — there is no indication
that the arbitration provision concerns only past claims. Rather, by its
terms, the arbitration provision covers allegations of "any other claim
of violation of law, including claims of discrimination or violation of
public policy." (Employment Agreement, at ¶ 16.) As a matter of
common sense, also, it would be illogical for a party to make a general
release of past claims and then agree to arbitrate the released claims.
Accordingly, Smith's third argument fails. The Court must give effect to
the arbitration provision agreed to by the parties by dismissing this
For the foregoing reasons, it is hereby
ORDERED that defendant Profession Security Bureau's motion to dismiss
the complaint is granted; and it is further
ORDERED that plaintiff Jeffery Smith proceed to arbitration if he
wishes to pursue the claims set forth in the complaint.
The Clerk of Court is directed to close this case.
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