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Valdez-Mendoza v. Jovani Fashion Ltd.

United States District Court, E.D. New York

February 7, 2017

ROBERTO VALDEZ-MENDOZA, RAMON E. VALDEZ-MENDOZA Plaintiff,
v.
JOVANI FASHION LTD., S&A MANUFACTURING, LLC Defendants.

          MEMORANDUM AND ORDER

          I. Leo Glasser, Senior United States District Judge

         Plaintiffs Roberto Valdez-Mendoza (“Roberto”) and Ramon Valdez-Mendoza (“Ramon, ” together the “Plaintiffs”) bring claims against Defendants Jovani Fashion Ltd. (“Jovani”) and S&A Manufacturing, LLC (“S&A, ” together the “Defendants”) for wage and hour violations under the Fair Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”). Before the Court is Defendants' unopposed motion to dismiss the complaint and compel arbitration pursuant to arbitration agreements signed by the Plaintiffs. Determination of this motion has been held in abeyance in view of docket sheet entries indicating that the parties were pursuing a settlement. It appearing that those discussions were not fruitful, the Court now addresses the motion.

         BACKGROUND

         Jovani is a dress manufacturer located in New York City. ECF 13-2 at ¶ 2. S&A is a wholly-owned subsidiary of Jovani that handles the packing and shipping of Jovani products. ECF 13-2 at ¶ 3-4. Defendants employed Plaintiffs to perform various duties in their warehouse. ECF 1 (“Compl.”) at ¶ 21, 45. Roberto was employed from January 2010 to August 22, 2014. Id. at ¶ 19. Ramon was employed from October 2013 to July 31, 2015. Id. at ¶ 43.

         There are two arbitration agreements that were effective at various times during the Plaintiffs' employment (together, the “Agreements”). The first appears on what seems to be the last page of the Jovani employee handbook. In bold letters at the top of the document, it reads “Agreement to Arbitration.” The document provides, in relevant part:

I hereby agree that any claim or controversy arising out of or relating to my employment by the company, including any compensation or the termination of my employment shall be submitted to arbitration to be held in New York County, New York State by and in accordance with the rules then in effect of the American Arbitration Association . . . This arbitration agreement applies (but is not limited to) to statutory discrimination, harassment, retaliation, whistleblower . . . the Fair Labor Standards Act, and any other federal, state or municipal discrimination, wage payment, whistleblower or fair employment practices law, statute or regulation, or common law. I understand and agree that by entering into this agreement, I am waiving any right to file a lawsuit or to have a jury trial over any claim covered by this agreement, any right to bring or litigate any such claim as a class or collective action, and any right to act as a class representative or to participate as a member of a class of claimants with respect to any such claim.

ECF 13-3, Exhs 1, 3. Roberto signed this document on May 26, 2011. Id. at Ex. 1. Ramon signed it on November 4, 2013. Id. at Ex. 3.

         On February 7, 2014, a second arbitration agreement was executed. This agreement appears on pages 3-4 of the Jovani employee handbook under the heading “Arbitration.” ECF 13-3 at ¶ 9. It provides, in relevant part:

Any dispute associated with employment, termination of your employment, discrimination, or harassment will qualify for arbitration resolution. This arbitration shall be the exclusive means of resolving any dispute arising out of employment or termination . . . In addition, both Jovani Fashions Ltd and the employee agree that arbitration will be used in lieu of civil court action regarding the dispute. . . The cost of the arbitrator is to be shared among the parties equally.

Id. at Ex. 6. Both Plaintiffs signed forms acknowledging receipt of that employee handbook on February 7, 2014. Id. at Exhs 4, 5.

         Plaintiffs initiated the instant action against Defendants, alleging 1.) failure to pay overtime wages in violation of the FLSA and NYLL, 2.) violation of the New York Wage Theft Prevention Act, 3.) retaliation under the FLSA and NYLL, 4.) conversion, and in the alternative, 5.) unjust enrichment. Compl. at pp. 15-20. Defendants moved to dismiss and compel arbitration on March 30, 2016. ECF 13.

         DISCUSSION

         A. Motion to Compel

         It is well-established that federal public policy strongly favors arbitration. See e.g. Holick v. Cellular Sales of N.Y., LLC, 802 F.3d 391, 395 (2d Cir. 2015). To that end, the Federal Arbitration Act (“FAA”) requires a federal court to enforce an arbitration agreement and to stay (or dismiss) litigation that contravenes it. 9 U.S.C. § 2. The FAA “leaves no place for the exercise of discretion by a district court, but instead mandates that district courts shall direct the parties to proceed to arbitration on issues as to which an ...


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