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Kuchinsky v. Curry

May 28, 2009

DAVID KUCHINSKY, PLAINTIFF,
v.
EDDY A. CURRY, DEFENDANT.



The opinion of the court was delivered by: Denise Cote, District Judge

OPINION & ORDER

Defendant Eddy A. Curry has moved to compel arbitration of this action. For the following reasons, the motion is granted.

BACKGROUND

On January 12, 2009, David Kuchinsky filed this diversity action against Curry for damages arising from Curry's employment of Kuchinsky from October 2005 to October 2008. As alleged in his complaint, Kuchinsky began to work for Curry in New York as a chauffeur. The parties executed a written Services Agreement ("Agreement"), and shortly thereafter Curry asked Kuchinsky to relocate to Illinois. Kuchinsky agreed to move, and the parties entered into a "subsequent agreement" in which Curry promised to pay Kuchinsky additional compensation for the relocation and an expansion of his duties.*fn1

Kuchinsky describes the additional duties that he performed for Curry that were "extraneous" to those covered by the Agreement as cleaning, repairing and moving furniture in Kuchinsky's residence, packing for Curry, and negotiating with third parties on behalf of Curry. Beginning in 2007, Curry began to treat Kuchinsky badly by, among other things, using derogatory and abusive epithets when addressing him, directing him to perform humiliating tasks, and pointing a loaded gun at him on two occasions. Because of these acts, Kuchinsky was constructively discharged in October 2008. Kuchinsky calculates that he is owed over $65,000 in back wages "pursuant to the parties' agreement" and for services that he performed that were "extraneous" to the Agreement, and over $25,000 for money that Kuchinsky advanced to Curry and for expenses that he incurred on behalf of Curry.

Kuchinsky's amended complaint, filed on February 24 2009, asserts nine causes of action. Four of them are pleaded as statutory violations under New York law. Kuchinsky brings claims for race and religious discrimination, sexual harassment, and creation of a hostile work environment under N.Y. Exec. L. Section 290 et seq., and a claim for unpaid wages in an amount in excess of $91,000 under New York Labor Law. In addition, Kuchinsky brings claims for intentional infliction of emotional distress, breach of contract based on the failure to pay in excess of $65,000 owed under the Agreement, breach of contract based on the parties' "subsequent" agreement,*fn2 breach of the implied covenant of good faith and fair dealing that applies to the parties' "contract", and promissory estoppel due to Curry's promise to reimburse Kuchinsky for expenses incurred during his employment and for the services he rendered to Curry.

On March 25, 2009, Curry filed a motion to arbitrate all claims in this action, and to dismiss the three claims pleaded pursuant to N.Y. Exec. L. Section 296 for lack of subject matter jurisdiction. The motion was fully submitted on May 1.

DISCUSSION

Curry's motion to dismiss the three claims pleaded under N.Y. Exec. L. Section 296 for lack of subject matter jurisdiction is denied. Curry contends that Kuchinsky has failed adequately to plead that Curry employed at least four persons during the relevant time; an employer with four or more employees being a necessary predicate for a violation of that law. See N.Y. Exec. L. § 292(5); Arculeo v. On-Site Sales & Mktg., LLC, 425 F.3d 193, 197 n.5 (2d Cir. 2005). This motion does not implicate the existence of subject matter jurisdiction over the claim, but is addressed to the complaint's failure to state a claim. Moreover, Kuchinsky has requested leave to amend to identify the three other employees whom he contends Curry employed during the relevant time period. Treating Curry's motion, therefore, as a motion to dismiss pursuant to Rule 12(b)(6), Fed. R. Civ. P., for failure to state a claim, it is denied. If this action were not subject to arbitration, then Kuchinsky would be granted leave to amend to plead that Curry employed at least four employees during the period at issue here.

Curry also seeks to require the plaintiff to arbitrate all of his claims. The Federal Arbitration Act ("FAA") was designed to "ensure judicial enforcement of privately made agreements to arbitrate." Dean Witter Reynolds Inc. v. Byrd, 470 U.S. 213, 219 (1985). The FAA represents "a strong federal policy favoring arbitration as an alternative means of dispute resolution." JLM Indus., Inc. v. Stolt-Nielsen SA, 387 F.3d 163, 171 (2d Cir. 2004) (citation omitted); see also Dynegy Midstream Services v. Trammochem, 451 F.3d 89, 96 (2d Cir. 2006). Therefore, "under the FAA, 'any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration, whether the problem at hand is the construction of the contract language itself or an allegation of waiver, delay, or a like defense to arbitrability.'" JLM Indus., 387 F.3d at 171 (quoting Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24-25 (1983)). The FAA requires that a contract provision to arbitrate disputes arising out of the contract "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.

Under the FAA, unless parties have unambiguously provided for an arbitrator to decide questions of arbitrability, it is for courts to decide whether the parties agreed to arbitrate. Contec Corp. v. Remote Solution Co., 398 F.3d 205, 208 (2d Cir. 2005). A court deciding a motion to compel arbitration must resolve four issues: (1) whether the parties agreed to arbitrate; (2) the scope of the agreement to arbitrate; (3) if federal statutory claims are asserted, whether Congress intended those claims to be nonarbitrable; and (4) if some, but not all, of the claims are arbitrable, whether to stay the balance of the proceedings pending arbitration. JLM Indus., 387 F.3d at 169.

The Agreement, which bears the date October 15, 2005, and is executed by both parties, provides in pertinent part that "[Curry] desires to retain Chauffeur services . . . [and Kuchinsky] desires to work for [Curry] in the aforesaid capacity." It describes Kuchinsky as an "Independent Driver" who was not entitled to benefits paid to Curry's employees. It establishes, among other things, Kuchinsky's compensation at a monthly rate and his responsibilities, which include, inter alia: that he "shall respond[] to the Chauffeur needs of the children, the mother and the father of the house," "provide transportation for friends and family designated by [Curry]," "ensure car is clean," and "drop off and pick up vehicles from repair shop." Its arbitration clause reads as follows:

Any controversy or claim arising out of or relating to the construction of or application of any terms, provisions, or conditions of this Agreement shall on the written request of any party hereto served on the other party, be submitted to arbitration and such arbitration shall comply with and be governed first, in accordance with the laws of the state of Illinois, by the provisions of the American Arbitration Association ("AAA") (without any regard to any Choice of Law provision), as both are applicable to contracts mad[e] and performed entirely within the State of New York. Such arbitration shall be binding on the parties.

Said locations of the arbitration shall be in the AA[A] office nearest to the Client's [Curry's] residence. The cost of arbitration shall be borne by the losing party or in such proportion as the arbitrator shall decide. Judgment on the award rendered by the arbitrator may be entered in any court in the world having jurisdiction. (Emphasis supplied). The Agreement ...


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