United States District Court, S.D. New York
AMENDED OPINION AND ORDER
Edgardo Ramos, U.S.D.J.
Michael Bright-Asante brings this action against Saks &
Company, Inc., the Vice President of Human Resources, Theo
Christ (together, “Saks”), and the Retail, Hotel,
and Department Store Union/United Food and Commercial Workers
International Local 1102 (“Local 1102”) (all
together, “Defendants”) alleging, among other
things, employment discrimination. Before the Court are three
motions: (1) Plaintiff's motion to amend the Amended
Complaint pursuant to Federal Rule of Civil Procedure 15(a);
(2) Saks' motion for sanctions pursuant to Federal Rule
of Civil Procedure 11; and (3) Saks' motion to compel
arbitration and/or dismiss the Amended Complaint pursuant to
Federal Rule of Civil Procedure 12(b)(6).
reasons stated below, Plaintiff's motion to amend and
Saks' motion for sanctions are DENIED and Saks'
motion to compel arbitration and/or dismiss is DENIED in part
and GRANTED in part.
Factual and Procedural
is an African American man formerly employed as a sales
associate in the women's shoe department at Saks Fifth
Avenue (the “Store”), a department store in New
York City. Amended Complaint (“Am. Compl.”)
¶ 10. He is married and has young children. Id.
at ¶ 96. Plaintiff is also a member of Local 1102.
Id. at ¶ 11. In December 2013, Local 1102 and
Saks entered into a binding collective bargaining agreement
(“CBA”). The CBA provides, in pertinent part,
that Saks possesses “all statutory and inherent
management rights, power, and authority” and that its
right to hire or suspend its salespeople was not limited by
any provision in the CBA. Rocco Decl. Ex. A, at 1. It also
contains a provision prohibiting discrimination against any
employee on account of gender, race, or any other legally
protected status. Id. at 14 (Article 25.
includes a three step grievance procedure to address a
dispute or complaint arising between Local 1102 and Saks out
of the CBA or “the interpretation thereof.”
Id. at 12 (Article 21. Administration, Grievance &
Arbitration Procedure). Step 1 states that within twenty
calendar days of an employee having a grievance, the employee
or Local 1102 must submit the grievance to Saks in writing.
Id. Saks must respond within twenty days (or
“as soon thereafter as practicable”). Step 2
provides that if the grievance is not settled during the
first step, it can be presented within twenty calendar days
of Saks' answer, in writing to Defendant Christ, the Vice
President of Human Resources at Saks. Id. This too
must be answered by Saks within twenty calendar days. Lastly,
if the grievance is not settled during the second step, after
twenty calendar days the grievance can be submitted to
arbitration. Id. at 13. To properly comply with Step
3, the employee must make a written demand for arbitration.
Id. Importantly, the antidiscrimination provision
makes no reference to this grievance procedure. Also, neither
the grievance procedures nor the antidiscrimination provision
address whether disputes arising under federal or state law
are subject to arbitration.
summer of 2014, Saks became aware of fraudulent activity
occurring at the Store and began an investigation of its
sales associates. Plaintiff alleges that at that time, the
racial makeup of the salespersons at the Store was
approximately fifty percent white and fifty percent
minorities. Id. at ¶ 48. He claims, however,
that Saks investigated only the non-white salespersons.
Id. at ¶ 49. Through its investigation, Saks
learned that sales associates were stealing merchandise from
the Store by the unauthorized use of customers' credit
cards. On September 5, 2014, Plaintiff was arrested by law
enforcement in connection with the investigation and charged
with grand larceny and theft. Id. at ¶ 13. Four
days later, on September 9, Christ sent Plaintiff a letter
suspending him without pay “pending the legal outcome
of [his] situation.” Id. at ¶ 14.
Plaintiff alleges that a white woman, who also worked in the
Store and similarly sold merchandize to the same customer,
was never investigated or suspended. Id. at
September 15, 2014, Local 1102 sent Saks an email
(“Step 1 Grievance”) requesting Plaintiff's
immediate reinstatement and back pay. Rocco Decl. Ex. B.
Plaintiff claims that the Step 1 Grievance was not signed by
him and did not comply with the CBA because it did not
include “a written summary” of his complaint
“and/or the contract provision alleged to have been
violated.” Am. Compl. ¶ 29. He further claims
that Saks did not respond within the requisite twenty-day
period and that Local 1102 made no efforts to enforce the
timeline. Id. at ¶¶ 34, 35. Plaintiff
contrasts his grievance process with that of a white
salesperson. Without providing further explanation or detail,
he claims that during the time Local 1102 was unresponsive to
him, it successfully grieved the suspension of a white
salesperson. Id. at ¶ 72.
claims that sometime after he was suspended from the Store,
he filed an application for unemployment benefits with the
New York State Unemployment Insurance Benefits Board. Am.
Compl. ¶ 86. He alleges that Saks opposed his
application in retaliation for filing the application, which
resulted in an initial denial of his unemployment benefits.
March 13, 2015, all of the criminal charges against Plaintiff
were dismissed. Id. at ¶ 19. One week later, on
March 20, Plaintiff sent a letter to Christ informing him
that his case had been dismissed and attached a copy of the
Certificate of Disposition. Id. at ¶ 19.
Plaintiff also duly notified Local 1102. Id. at
¶ 21. Plaintiff claims that no one from Saks responded
to his letter. Id. at ¶ 20. He also claims that
no one from Local 1102 responded to a letter he sent on April
10, inquiring about his grievance and reinstatement.
Id. at ¶ 22. Though Plaintiff notes that
representatives of Local 1102 did inform him that a grievance
had been filed, he never received proof of the grievance or
further updates regarding the grievance process until after
he filed the instant action. Id. at ¶¶
27, 2015, Plaintiff filed the instant suit. (Doc. 1)
Plaintiff alleged that Saks unlawfully discriminated and
retaliated against him and breached the CBA. Id. He
also alleged that Local 1102 unlawfully discriminated against
him and breached its duty of fair representation.
Approximately one month later, on August 21, 2015, Local 1102
submitted Plaintiff's grievance to arbitration. Am.
Compl. ¶ 41. On September 28, 2015, the Court entered an
Order of Automatic Referral to mediation. (Doc. 16) The
mediation session was held on January 8, 2016, however the
parties could not reach a resolution. On February 9, 2016,
Plaintiff requested a pre-motion conference to seek leave to
amend the Complaint. (Doc. 20) The Court held the pre-motion
conference and granted Plaintiff leave to file an amended
complaint to include additional allegations against Local
1102. Plaintiff filed the Amended Complaint on April 4, 2016.
(Doc. 25) The Amended Complaint included additional factual
allegations and a claim for constructive discharge against
Saks. Am. Compl. ¶¶ 94-98. Shortly thereafter, on
April 29, 2016, Saks sought leave to file a motion to dismiss
the Amended Complaint and/or compel arbitration. (Doc. 28)
After the pre-motion conference on May 19, 2016, the Court
granted Saks leave to file the instant motion, which it filed
on June 9, 2016. (Doc. 32)
letter dated August 11, 2016, Plaintiff informed the Court
that the arbitration hearing had concluded and attached the
Arbitrator's findings (the “Award”), dated
July 29, 2016. Arbitration Award (Doc. 40). At the
arbitration, Saks argued that its treatment of Plaintiff was
properly supported by evidence that showed Plaintiff engaging
in fraudulent transactions. According to Catherine Richards,
the Director of Investigations at Saks, on August 29, 2014,
Plaintiff sold pairs of Louboutin and Givenchy shoes
(totaling more than $6, 000) by using the credit card account
number of a customer who was not present at the Store on that
day and who had not authorized the purchase. Id. at
4. Richards testified that a surveillance video - which was
not viewed at the arbitration - showed Plaintiff making the
transactions at two separate registers and giving the shoes
to a woman who was not the owner of the credit card account.
Id. Local 1102 argued that Saks could not meet its
burden of proof because the criminal charges against
Plaintiff had been dropped, and Saks did not produce the
individual whose card was allegedly used or the surveillance
video showing Plaintiff's actions.
Arbitrator found in favor of Saks and denied Local 1102's
grievance. He relied on Richards' testimony regarding the
video, stating that Richards' “unequivocal”
identification of Plaintiff in the video established
Plaintiff's involvement in the fraudulent transaction.
Id. at 6. The Arbitrator also highlighted (1) the
absence of the true cardholder; (2) Plaintiff's use of
two separate registers to complete the purchase, and (3)
Plaintiff's giving the shoes to a woman that was not the
true cardholder. Lastly, the Arbitrator noted that there was
no “plausible, benign reason” for Plaintiff's
actions and that because Plaintiff did not attend the
arbitration, “he obviously could not explain away what
he did.” Id.
August 11 letter attaching the Award, Plaintiff claimed that
the issue addressed by the Arbitrator was not the issue that
Local 1102 had originally submitted for arbitration and that
he was not made aware of the “new stipulated
issue” until after the Award had been issued.
Id. The Court directed Defendants to respond to
Plaintiff's letter and to advise the Court on the impact
of the Award on the pending motion to dismiss. (Doc. 41) On
October 10, 2016, in response to Plaintiff's letter, Saks
and Local 1102 provided a summary of the Arbitrator's
findings and emphasized that neither Plaintiff, nor his
counsel, attended or participated in the arbitration. (Docs.
42, 43) Saks further claimed that its motion was unaffected
by the Arbitrator's findings and the Award. The next day,
on October 11, Plaintiff filed a letter with the Court
claiming that Defendants were in collusion because both Saks
and Local 1102 knew that the video on which the Arbitrator
relied did not support the Arbitrator's conclusions.
(Doc. 44) Plaintiff claimed that Richards “deliberately
misled the Arbitrator and perjured herself” by claiming
that it was not Saks' policy to allow customers to make
purchases without physically showing their credit card. He
also attached a copy of Saks' policy allowing for
transactions without the Store credit card so long as
additional steps are taken to confirm the identification of
the customer. On October 12, Plaintiff requested a pre-motion
conference to vacate the Award or in the alternative seek
leave to file an amended complaint to include a claim to
vacate the Award. (Doc. 45)
Court held the pre-motion conference on November 2, 2016. At
the conference, Plaintiff's counsel explained that Local
1102 had been unresponsive to Plaintiff's requests for
information regarding his grievance and that he did not
receive any information from Local 1102 until after he filed
the instant action. The Court cautioned Plaintiff that based
on the facts presented at the conference, it was unlikely
that Plaintiff's motion to amend would be granted.
See Transcript of 11/2/2016 Conference (Doc. 53) at
14:9-18. Saks also informed the Court of its intention to
seek sanctions in the event that Plaintiff filed the motion
to amend. On November 7, 2016, Saks sent Plaintiff's
counsel a letter giving notice of Saks' intention to file
a Rule 11 motion in the event Plaintiff filed a motion amend.
Declaration of Wendy Johnson Lario in Opposition
(“Lario Decl.”) (Doc. 59) Ex. B. On November 30,
2016, Plaintiff filed the instant motion to file a Second
Amended Complaint. (Doc. 55) Two weeks later, on December 14,
2016, Saks filed a cross-motion for sanctions. (Doc. 57)
Rule 15 Motion to Amend
are entitled to amend their pleadings once, as a matter of
course, within 21 days after serving the pleading or, if a
responsive pleading is required, within 21 days after service
of a responsive pleading or a Rule 12 motion. Fed.R.Civ.P.
15(a)(1). A party may not otherwise amend its pleading
without either the written consent of the opposing party or
leave of the court. Fed.R.Civ.P. 15(a)(2). “The court
should freely give leave when justice so requires.”
Id. The Supreme Court has held that it would be an
abuse of discretion, “inconsistent with the spirit of
the Federal Rules, ” for a district court to deny leave
without some justification, “such as undue delay, bad
faith or dilatory motive on the part of the movant, repeated
failure to cure deficiencies by amendments previously
allowed, undue prejudice to the opposing party by virtue of
allowance of the amendment, futility of amendment,
etc.” Foman v. Davis, 371 U.S. 178, 182
(1962). Leave to amend may be denied on the basis of futility
if the proposed claims would not withstand a Rule 12(b)(6)
motion to dismiss. Dougherty v. Town of N. Hempstead Bd.
of Zoning Appeals, 282 F.3d 83, 88 (2d Cir.
2002). The party opposing the amendment has the burden of
establishing its futility. Blaskiewicz v. Cnty. of
Suffolk, 29 F.Supp.2d 134, 137-38 (E.D.N.Y. 1998)
(citing Harrison v. NBD Inc., 990 F.Supp. 179, 185
Rule 12(b)(6) Motion to Dismiss
Rule 12(b)(6), a complaint may be dismissed for
“failure to state a claim upon which relief can be
granted.” Fed.R.Civ.P. 12(b)(6). When ruling on a
motion to dismiss pursuant to Rule 12(b)(6), the Court must
accept all factual allegations in the complaint as true and
draw all reasonable inferences in the plaintiff's favor.
Koch v. Christie's Int'l PLC, 699 F.3d 141,
145 (2d Cir. 2012). However, the Court is not required to
credit “mere conclusory statements” or
“threadbare recitals of the elements of a cause of
action.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S.
544, 555 (2007)); see also Id. at 681 (citing
Twombly, 550 U.S. at 551). “To survive a
motion to dismiss, a complaint must contain sufficient
factual matter . . . to ‘state a claim to relief that
is plausible on its face.'” Id. at 678
(quoting Twombly, 550 U.S. at 570). A claim is
facially plausible “when the plaintiff pleads factual
content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Id. (citing Twombly, 550
U.S. at 556). If the plaintiff has not “nudged [his]
claims across the line from conceivable to plausible, [the]
complaint must be dismissed.” Twombly, 550
U.S. at 570.
Motion to Amend ...