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Torres v. The Major Automotive Group

United States District Court, E.D. New York

September 25, 2014

JOSE TORRES, Plaintiff,
v.
THE MAJOR AUTOMOTIVE GROUP, MAJOR WORLD, HAROLD BENDELL, CHRIS ORSARIS and ADAM COHEN, Defendants.

MEMORANDUM & ORDER

NICHOLAS G. GARAUFIS, District Judge.

Plaintiff Jose Torres brings this action against Defendants Major Automotive Group, Major World, [1] Harold Bendell, Chris Orsaris, and Adam Cohen (collectively, "Defendants"[2]). Plaintiff, a former car salesman, claims that Defendants deviated from the terms of his commission agreement by making unauthorized and undocumented withdrawals from his pay. Plaintiff alleges multiple causes of action, including violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201 et seq., and numerous provisions of the New York Labor Law. Defendants move to compel arbitration pursuant to Section 4 of the Federal Arbitration Act ("FAA"), 9 U.S.C. § 4. For the reasons set forth below, Defendants' Motion is DENIED.

I. BACKGROUND

A. The Parties

Plaintiff Torres is a citizen of New York and resident of Queens. (Compl. (Dkt. 1) ¶ 6.) Plaintiff had been employed by Major Chevrolet, Inc. as a commissioned auto sales representative. (Answer (Dkt. 9) ¶¶ 15-16.) Defendant Major Automotive Group Inc. is a domestic corporation operating in Queens County in Long Island City, New York. (Compl. ¶ 8.) Defendants Major Automotive Group Inc. and Major World are companies within the Major Auto Group. (Decl. of Lee Squitieri ("Squitieri Decl.") (Dkt. 21-2) ¶ 2.) Defendant Bendell is the President and Defendant Cohen is a Vice President and General Counsel to the companies.[3] (Id.)

Plaintiff alleges that during the course of his employment, Defendants violated the terms and conditions of Plaintiff's commission agreement, made unauthorized and undocumented withdrawals from Plaintiff's pay, and failed to pay Plaintiff overtime compensation for all hours worked in excess of 40 hours per week. (Decl. of Saul D. Zabell in Opp'n to Mot. to Compel ("Zabell Opp'n Decl.") (Dkt. 20-2) ¶ 3.) As a result, Plaintiff alleges that Defendants violated Section 7 of the FLSA, 29 U.S.C. § 207(a)(1), and Articles 6 and 7 of the New York Labor Law, N.Y. Lab. Law §§ 170, 190 et seq. (Compl. ¶¶ 24-26, 28-30, 36-42, 44-48.) Plaintiff also asserts causes of action based on breach of contract, unjust enrichment, and fraud. ( Id. ¶¶ 32-34, 50-51; 53-57.)

B. The Relevant Agreements

In January 2012, Plaintiff and Defendants signed a one-page "Used Vehicle Salesperson Commission Agreement" (the "Commission Agreement, " or the "Agreement"). (Squitieri Decl., Ex. A (Dkt. 21-3).) The Commission Agreement provided that Plaintiff would receive a base salary payable bi-weekly at $20 per day. (Id.) It also set forth a methodology for calculating commissions on vehicle sales earned by the Plaintiff. (Id.) Under the Agreement, Plaintiff's commission was set at 20% of "gross commissionable profit." (Id.)

At the bottom of the page-just above the parties' signatures-the Agreement also contained the following provision: "The company's Arbitration Agreement for non-union employees is in effect and has not been altered by this agreement. A copy of the Arbitration Agreement is printed on the back of this form for your reference." (Id.) Just below the parties' signatures, the Commission Agreement further provided that "[t]his Agreement is intended to set forth the company's pay plans and to clarify existing commission agreements. It does not supersede the terms of any applicable collective bargaining agreement; it is a supplement to and explanation of agreements." (Id.) The Commission Agreement was signed by Plaintiff and a representative for Defendants. (Id.)

The single-page Arbitration Agreement "for Non Union Employees" was printed on the reverse side of the Commission Agreement. (Opp'n to Mot. to Compel (Dkt. 20) at 4.) Under the title at the top of the page, the Arbitration Agreement established, "As of January 11, 2012, This Agreement Supersedes and Replaces All Previous Oral and Written Agreements." (Squitieri Decl., Ex. A.) In the very first paragraph, the Arbitration Agreement contained the following clause:

ANY DISPUTE OR CONTROVERSY ARISING OUT OF, RELATING TO, OR CONCERNING ANY ASPECT OF MY EMPLOYMENT, INCLUDING BUT NOT LIMITED TO ANY INTERPRETATION, CONSTRUCTION, PERFORMANCE OR BREACH OF MY EMPLOYMENT RIGHTS, SHALL BE SETTLED BY ARBITRATION TO BE HELD IN NEW YORK, NEW YORK IN ACCORDANCE WITH THE EMPLOYMENT DISPUTE RESOLUTION RULES THEN IN EFFECT OF THE AMERICAN ARBITRATION ASSOCIATION.... THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE AND BINDING ON THE PARTIES TO THE ARBITRATION.

(Id. ¶ (a).) The same paragraph also provided:

THIS ARBITRATION CLAUSE CONSTITUTES A WAIYER OF EMPLOYEE'S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP INCLUDING, BUT NOT LIMITED TO, THE FOLLOWING CLAIMS: (I) ANY AND ALL COMMON LAW CLAIMS FOR... BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED... (II) ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL, STATE OR MUNICIPAL STATUTE OR ORDINANCE, INCLUDING, BUT NOT LIMITED TO... THE FAIR LABOR STANDARDS ACT... THE NEW YORK LABOR LAW; AND ALL FUTURE EMPLOYMENT LAWS; (III) ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.

(Id.) Plaintiff claims that he "never saw" the Arbitration Agreement until Defendants supplied it to Plaintiff's counsel in connection with this litigation. (Aff. of Jose Torres in Opp'n to Mot. to Compel ("Torres Aff.") ¶ 7.) The Arbitration ...


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