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Baez v. Prospect Mortgage, LLC

United States District Court, E.D. New York

April 9, 2014



VIKTOR V. POHORELSKY, Magistrate Judge.

The plaintiffs, former employees of the defendant corporation, assert that the defendant failed to pay them minimum and overtime wages to which they are entitled under the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. ("FLSA"), and the New York Labor Law, Article 19 § 650, et seq. ("NYLL"). The defendant has demanded that the case be tried by a jury. The plaintiffs now move to strike the defendant's jury trial demand pursuant to Federal Rules of Civil Procedure 12(f) and 39(a)(2). They contend that the defendant has waived its right to a jury trial by requiring each of the plaintiffs to sign a Jury Waiver Agreement ("Agreement") at the time they were hired. For the reasons that follow, the plaintiffs' motion to strike is denied.[1]


The defendant is a California corporation that provides mortgage loans, and has offices in New York and several other states. Prospective employees of the defendant are required to sign a "Jury Waiver Agreement" relinquishing their right to a jury trial should they someday choose to pursue litigation against their newfound employer. The Agreement provides in its entirety:

Although the Company believes that our internal complaint resolution procedure should be sufficient to resolve any workplace problems that you may have, we recognize that sometimes, notwithstanding everyone's best efforts, a matter cannot be resolved internally. In those rare instances, we believe that our nation's judges (such as our federal judges who are appointed by Congress for life and thus are free from any outside bias or influence) are in the best position to resolve our workplace disputes. Accordingly, we have created this policy which, in effect, says that if you file a lawsuit, a judge will decide if we acted correctly or incorrectly. This policy does not take away any of your rights to sue or seek any type of remedy the law allows, it simply provides for a federal or state judge to decide our differences. By signing this agreement, you consent to waive your right to a jury trial with respect to any lawsuit you may commence against Metrocities Mortgage, LLC, a Prospect Mortgage Company, its affiliates, subsidiaries, divisions, successors, assigns, and purchasers, and the current, former, and future employees, shareholders, officers, directors and agents thereof ("the Company"), relating in any matter to your application for, employment with, or cessation of your employment, any term and condition of your employment with the Company or any other claim or dispute. Absent your signing this Jury Waiver Agreement you would not be hired or remain employed by the Company. You have the right to consult with counsel of your choosing regarding this Jury Waiver Agreement prior to signing this document.

By signing below you acknowledge that you have had a reasonable period of time to consider this Jury Waiver Agreement and are waiving your right to a jury trial knowingly, voluntarily, and free from duress or coercion.

Sept. 3, 2013 Chase Decl., Ex. 1, Dkt. Ent. 17-3.

On October 18, 2010, three of the defendant's former loan officers with no relation to the instant action filed a putative class/collective action against the defendant in the Eastern District of California, alleging that the defendant violated California and federal law by failing to pay its employees required minimum and overtime wages. See Sliger v. Prospect Mortgage, LLC, No. CV-11-465, 2011 WL 3747947 (E.D. Ca Aug. 24, 2011) ("the Sliger litigation"). The complaint included a jury demand, which the defendant did not oppose. On August 24, 2011, the court in Sliger conditionally certified a nationwide collective action encompassing current and former Prospect Mortgage loan officers, and directed that notice of the litigation be given to those with potential claims. The six individuals who would later become the plaintiffs here consented to join the Sliger litigation between November 2011 and March 2012. Compl., Ex. A, Dkt. Ent. 1; Wexler Decl. ¶ 5, Dkt. Ent. 27-1. Their claims are now before this court because the collective action in California was decertified by stipulation of the parties on January 23, 2013. Compl. Ex. B; Wexler Decl. ¶ 6.

Following decertification, various former opt-in plaintiffs in the Sliger case filed similar actions in other jurisdictions. See Aguilera v. Prospect Mortg., LLC, No. CV-13-5070, 2013 WL 4779179 (C.D. Cal. Sept. 5, 2013); Aldrich v. Prospect Mortgage, LLC, No. CV-13-3711, 2013 WL 5506676 (N.D. Ca. Oct. 3, 2013); Allaway v. Prospect Mortgage, No. CV-13-3004, 2013 WL 6231382 (N.D. Ill. Nov. 26, 2013); Avants v. Prospect Mortgage, LLC, No. CV-13-376, 2013 WL 6641349 (D.N.M. Dec. 17, 2013); Barker v. Prospect Mortg., No. CV-13-822, 2013 WL 5314710 (D. Ariz. Sept. 23, 2013); Del Gaizo v. Prospect Mortgage, LLC, No. CV-13-6200, 2013 WL 5834455 (W.D.N.Y. Oct. 30, 2013); Hopple v. Prospect Mortg., LLC, No. 13-cv-137, 2013 WL 5493004 (W.D. Tex. Oct. 2, 2013).

The above-captioned plaintiffs filed the instant action on April 23, 2013, again alleging the defendant's failure to pay required wages. Dkt. Ent. 1. An amended complaint was filed on July 5, 2013. Dkt. Ent. 4. Unlike in the Sliger litigation, neither of these complaints demanded a jury trial. The defendant, however, made a jury demand in its answer to the amended complaint, filed on August 12, 2013. Dkt. Ent. 11. The plaintiffs then filed the instant motion to strike the jury demand on September 3, 2013. Dkt. Ent. 18.

The plaintiffs contend that the Jury Waiver Agreement is a valid bilateral contract that obligates both the signatory and the defendant to forgo their right to a jury trial in the event of litigation between the two parties.

The defendant opposes the motion on several grounds. It primarily argues that the plaintiffs repudiated their Jury Waiver Agreements by opting into the Sliger litigation and thereby electing to have their claims decided by a jury. Def.'s Opp. 6-7. The defendant also argues that the record bears no evidence of the Agreements' existence because the copies attached to the plaintiffs' motion have not been properly authenticated. Id. at 7-9. In a footnote, the defendant further asserts that the Agreements do not waive the defendant's right to demand a jury trial because the Agreements only impose obligations on the signatory, and also because they do not specifically name the defendant by its current business name. Id. at 6, n. 2.


I. Legal Standard

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