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PERRY v. NEW YORK LAW SCHOOL

July 27, 2004.

DOROTHEA PERRY, Plaintiff,
v.
NEW YORK LAW SCHOOL and COLLEGIS, INC., Defendants.



The opinion of the court was delivered by: GEORGE DANIELS, District Judge

MEMORANDUM OPINION & ORDER

Plaintiff brings this action against her former employers, New York Law School ("NYLS") and Collegis, Inc. ("Collegis"), alleging violations of Title VII, New York State and City law, and the Fair Labor Standards Act.*fn1 Defendant Collegis moves to dismiss or alternatively to suspend the proceeding and compel arbitration pursuant to the Federal Arbitration Act ("FAA"). For the reasons stated below, defendant's motion to compel arbitration is granted, and plaintiff's claims are dismissed against Collegis.

BACKGROUND

  Plaintiff was hired by NYLS in April 1990 as a Coordinator of User Services to provide technical support to the NYLS community. Her responsibilities included the support of hardware and software as well as communication assistance for users at NYLS. In November 1997, the computer support function at NYLS was contracted out to Collegis, a higher education services company. In connection with the commencement of her employment with Collegis, plaintiff signed an employment agreement with Collegis that required any disputes "arising out of or concerning the interpretation or application of" the employment agreement to be resolved exclusively by arbitration under the Rules of the American Arbitration Association ("AAA").*fn2 Simmons Affidavit Ex.5 p. 4, ¶ 11.

  Plaintiff claims that during her employment she was "subjected to racially offensive comments and behavior" by the Executive Director of Collegis in violation of Title VII of the Civil Rights Act of 1964, the New York City Human Rights Law, and the New York State Human Rights Law. Complaint p. 7, ¶ 23. Plaintiff further alleges that in June 2002, during the course of working on a law professor's computer, she and a co-worker discovered a file of pornographic images of young girls. Plaintiff claims that this created a "hostile work environment" because the images were "perverse and degrading to women." Plaintiff alleges that she reported the child pornography to the Executive Director, but no legal action was taken against the professor until plaintiff personally visited the Federal Bureau of Investigation to discuss the matter. The professor was eventually investigated, arrested, and sentenced after he pled guilty to possessing child pornography.

  In June 2002, plaintiff was placed on employment "probation" and subsequently terminated in October 2002. In her complaint, plaintiff alleges that Collegis and NYLS subjected her to (1) race and color discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et. seq., the New York State Human Rights Law, N.Y. Executive Law § 290 et. seq., and the New York City Human Rights Law, N.Y. Admin. Code § 8-101, et. seq.; (2) retaliation in violation of these laws; and (3) violations of the Fair Labor Standards Act, 29 U.S.C. § 216, et. seq. and New York Labor Law by failing to pay her compensation for overtime.

  Plaintiff argues that Collegis and NYLS terminated her employment in retaliation for her opposition to their racial discrimination and her complaints about the child pornography in violation of Title VII of the Civil Rights Act of 1964 and the New York State Human Rights Law. Plaintiff further claims that although she was consistently required to work more than forty hours per week, she was never paid overtime compensation as required by the Fair Labor Standards Act and New York Labor Law.

  On October 21, 2003, plaintiff filed a complaint in New York Supreme Court, New York County, naming NYLS and Collegis as defendants. Collegis filed and served a demand for arbitration with the AAA on November 5, 2003. The AAA sent a letter to all parties on November 12, 2003, informing them that the defendants had properly paid their $375.00 filing fee and requesting that plaintiff remit her capped filing fee of $125.00. Plaintiff failed to do so by the deadline given by the AAA, and on November 24, 2003, the AAA sent a letter to all parties informing them that the filing requirements were incomplete, and AAA returned the original files. On November 20, 2003, NYLS and Collegis removed the case to the United States District Court for the Southern District of New York. Defendant Collegis filed the instant motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(1), 12(b)(3), and 12(b)(6), or alternatively to suspend these proceedings and to compel arbitration. DISCUSSION

  I. Motion to Compel Arbitration

  Under the FAA, a district court may stay proceedings if it finds a valid arbitration agreement and may compel arbitration when a party refuses to comply with that agreement. 9 U.S.C.S. §§ 3-4. When considering a motion to compel arbitration, there are four issues the Court must resolve. Lewis Tree Serv., Inc. v. Lucent Techs., Inc., 239 F. Supp.2d 332, 335 (S.D.N.Y. 2002). It must determine: first, whether the parties agreed to arbitrate; second, whether the issues raised fall within the scope of their agreement; third, whether Congress intended the plaintiff's claim to be non-arbitrable; and fourth, when some but not all of the claims are arbitrable, whether to stay the balance pending arbitration. Genesco, Inc. v. T. Kakiuchi & Co., 815 F.2d 840, 844 (2d Cir. 1987).

  Plaintiff does not deny that she entered into the employment agreement to arbitrate with Collegis, nor does she deny that the issues she has raised fall within the scope of that agreement.*fn3 The agreement states:
"The Corporation agrees to comply with all applicable laws, regulations, or ordinances governing this employment, including but not limited to Title VII of the Civil Rights Act . . . and [its] state or local counterpart . . ." "All disputes arising out of or concerning the interpretation or application of this Agreement, including without being limited to any claims that the application of this Agreement or the termination of the employment relationship established by this Agreement violates any federal, state, or local law, regulation, or ordinance (including but not limited to those set forth in paragraph 10 above), shall be resolved timely and exclusively by arbitration pursuant to the Rules of the American Arbitration Association (AAA) . . ."
Simmons Affidavit Ex.5 p. 4, ¶ 10, 11. Further, the Second Circuit has squarely held that Congress intended Title VII claims to be subject to arbitration. Desiderio v. NASD, 191 F.3d 198, 204-205 (2d Cir. 1999). See also Martens v. Smith Barney, 238 F. Supp.2d 596, 601 (S.D.N.Y. 2002); Zouras v. Goldman Sachs Group, Inc., 2003 U.S. Dist. LEXIS 14514 (S.D.N.Y. 2003). State and local discrimination claims are also arbitrable. See Fletcher v. Kidder, Peabody & Co., 81 N.Y.2d 623, 638 (N.Y. 1993); see also Martin v. SCI Mgmt. L.P., 296 F. Supp.2d 462, 467 (S.D.N.Y. 2003). FLSA claims are also arbitrable. See Martin, 296 F. Supp.2d at 467; see also Adkins v. Labor Ready, Inc., 303 F.3d 496, 506 (4th Cir. 2002). Having found that all claims at issue are subject to arbitration, there is no need to consider whether to stay any non-arbitrable claims against Collegis while the arbitration proceeds.

  a. Fee Sharing

  Plaintiff contends, however, that the arbitration agreement she signed is unenforceable because its fee sharing provision makes the cost of arbitration prohibitively high and prevents her from vindicating her statutory rights. Her argument, however, is without merit.

  The arbitration agreement states "[t]he parties shall share equally all costs of arbitration excepting their own attorneys fees." Simmons Affidavit Ex. 5 p. 4, ¶ 11. Plaintiff claims that under this provision, she will have to pay, in advance of arbitration, a fee of $11,750.00. In calculating this projected cost, plaintiff used the AAA ...


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