The opinion of the court was delivered by: Lenihan, M. J.
On April 28, 2009, the Court granted Plaintiff's Motion for Reconsideration and ordered the parties to file supplemental briefing on Defendant's alternative motion to compel arbitration. The parties have submitted their supplemental briefs and supporting documents and the Court has fully considered their arguments and evidence.*fn1
Plaintiff opposes Defendant's motion to compel arbitration arguing, in essence, that the arbitration agreement should not be enforced because the high costs of arbitration would preclude her from effectively vindicating her federal statutory rights in the arbitral forum. In support of her argument, Plaintiff has submitted two affidavits, along with several exhibits allegedly supporting her first quarter 2009 income, foreclosure of her former marital home, and custody order; and an affidavit of a paralegal employed by Plaintiff's counsel attesting to the fees/costs of the American Arbitration Association ("AAA").*fn2 Plaintiff submits that she should be allowed to continue her lawsuit before this Court because the arbitration agreement, as drafted, is largely unenforceable, and because Defendant, having refused to negotiate as a prerequisite to arbitration, should not receive the benefit of the selective enforcement or rewriting of the District General Agent Agreement ("DGA") that results in an order compelling AAA arbitration under the Commercial Arbitration Rules. Alternatively, Plaintiff suggests that if the Court believes mediation or arbitration is required, that arbitration under the Western District's ADR program, W.D.L.R. 16.2, be ordered as this would be a more economical forum yet still accommodate Defendant's wish to have the claims resolved by arbitration. Finally, Plaintiff suggests that if the Court compels AAA arbitration, that it be done at Defendant's expense.
In response, Defendant argues that the evidence proffered by Plaintiff in support of her alleged financial inability to pay for arbitration is insufficient. In particular, Defendant argues that without documentation of Plaintiff's actual income or indebtedness, this Court cannot determine that Plaintiff has sufficiently supported her financial inability to afford AAA arbitration. Moreover, Defendant posits that Plaintiff's statement that she owes potentially $50,000 in tax liability to the IRS is unsubstantiated. Defendant argues that Plaintiff's affidavits, which contain self-serving statements without any supporting documentation, are insufficient to factually support her assertions related to her own financial ability to afford AAA arbitration, as required by the summary judgment standard, citing Zumpano v. Omnipoint Communications, Civ.A. No. 00-CV-595, 2001 U.S. Dist. LEXIS 376, * 27 (E.D.Pa. Jan. 18, 2001). Defendant further submits that the mortgage foreclosure action is no longer active and therefore, Plaintiff has not proven financial responsibility related to that action.
Defendant further contends that Plaintiff has failed to explain the basis of her alleged damages and, in any event, her potential damages under the causes of action asserted in her complaint are unlikely to reach the amount necessary to generate an AAA filing fee of $8,000, based on the relevant law and available undisputed facts. Defendant submits that under the DGA, all costs of arbitration are to be equally apportioned between the parties, and therefore, Plaintiff's calculations regarding the costs of arbitration attributable to her are inaccurate. In support of its arguments, Defendant proffers evidence regarding the status of the foreclosure of the mortgage on Plaintiff's former marital home; and 1099-MISC forms issued to Plaintiff for 2006 and 2007.
Subsequently, Plaintiff filed a reply brief and rebuttal evidence consisting of the docket from Wayne County Common Pleas Court in Wooster, Ohio, and other papers filed therein showing an updated status of the foreclosure action; three (3) 1099-MISC forms for 2008 issued to Plaintiff; and a statement from American Heritage Life Insurance Company ("American Heritage") showing commissions earned in 2009 through May 31, 2009.
The outcome here is governed by the Supreme Court's decision in Green Tree Financial Corp. v. Randolph, 531 U.S. 79 (2000), and the court of appeals decision in Spinetti v. Service Corp. Int'l, 324 F.3d 212 (3d Cir. 2003). Under Green Tree, a party seeking to invalidate an arbitration agreement on the basis that arbitration would be prohibitively expensive, bears the burden of proving the likelihood of incurring such costs. 531 U.S. at 92. However, the Supreme Court refrained from providing any guidance as to how detailed the showing of prohibitive expenses must be to support a finding that the agreement to arbitrate is invalid, since the plaintiff in Green Tree had not presented any evidence at all regarding the likelihood of incurring such costs. Id. Nonetheless, the court of appeals in Spinetti did note that at least two other courts of appeals have attempted to delineate such a standard. For example, the Spinetti court noted that the U.S. Court of Appeals for the Sixth Circuit held that "potential litigants must be given the opportunity to demonstrate that potential costs are great enough to deter them and similarly situated individuals from seeking to vindicate their federal statutory rights[.]" 324 F.3d at 217 (citing Morrison v. Circuit City Stores, Inc., 317 F.3d 646, 660 (6th Cir. 2003)). The court of appeals in Spinetti also noted the test employed by the Fourth Circuit: "the appropriate inquiry is one that focuses on the claimant's ability to pay the arbitration fees and costs and whether these are substantial enough to deter the bringing of claims[.]" Id. (citing Bradford v. Rockwell Semiconductor Sys., Inc., 238 F.3d 549, 556 (4th Cir. 2001)).
In Spinetti, the court of appeals noted that the district court embarked on a fact-specific inquiry to determine whether the plaintiff had met her burden of demonstrating that the costs associated with arbitrating her claims were prohibitively expensive thereby denying her the opportunity to vindicate her statutory rights. 324 F.3dat 216. The evidence presented by Spinetti, that the district court found adequate to show that the costs associated with arbitrating her claims were prohibitive, included the following evidence: (1) AAA fees that Spinetti was required to pay, which included an initial, non-refundable filing fee of $500, an additional filing fee of $2,750, a case-filing fee of $1,000, an additional charge of $150 for each day of the hearing, and one-half of the cost of an arbitrator; (2) a mid-range arbitrator in Western Pennsylvania charges an hourly fee of $250 with a $2,000 per day minimum; (3) an annual salary of $65,000 while employed by defendant and six months of unemployment following her termination; and (4) earnings of less than $300 per week from new employment with monthly expenses totaling $2,000, and using credit cards to get cash advances to make up the difference. Id. at 217 (citing D. Ct. Op. at 10 (reported at 240 F.Supp.2d 350, 354-55 (W.D.Pa. 2001)). The district court observed that a person who was living off of credit card advances could hardly afford to pay the costs associated with arbitration. 240 F.Supp. 2d at 355. The district court noted, however, that "had Spinetti failed to tender any information about her financial status, or inability to pay, [it] would [have] decline[d] to hold that an individual making $65,000 per year would be unable to pay arbitration costs." Id. at 355 n. 7 (citing Cline v. H.E. Butt Grocery Co., 79 F.Supp. 2d 730, 733 (S.D. Tex. 1999)).
In the instant matter, although Plaintiff has produced some evidence in support of her financial inability to afford the costs of arbitration, it falls short of what the plaintiff produced in Spinetti. Thus, the question here is whether Plaintiff's evidence is sufficient to meet her burden under Green Tree. Based on the parties' submissions, the Court concludes that Plaintiff has failed to satisfy her burden.
The DGA contains the following provision regarding the allocation of arbitration costs:
The arbitrator shall be authorized to award such relief as is allowed by law. The award shall equally apportion between the parties all costs of arbitration, including but not limited to, all administrative fees and the arbitrator's compensation and expenses, if any. However, except as provided elsewhere in this Agreement, each party shall be responsible for its own attorney's fees incurred during the course of the arbitration, as well as the costs of any witnesses or other evidence such party produces or causes to be produced....
DGA, Section XIV (Ex. A to Def.'s Mot. to Dismiss (Doc. 6-2)). Although the DGA indicates that the costs of arbitration are to be apportioned equally between the parties in the arbitrator's award, it does not indicate who is responsible for paying the costs when they are due and payable. The Commercial Arbitration Rules indicate that the initial filing fee is payable in full by the filing party when the claim is filed. See Ex. D to Pl.'s Br. (Doc. 22-5). The case service fee is payable in advance at the time the first hearing is scheduled. Id. Therefore, pursuant to the terms of the DGA and the Commercial Arbitration Rules, it appears that Plaintiff would be responsible for paying 100% of the filing fee at the initiation of arbitration, but would later recoup 50% of this fee.
Here, Plaintiff has proffered evidence as to the arbitration fees charged by the AAA. According to the affidavit submitted by Angela DiSanti and the attached fee schedule from the AAA as of September 1, 2007, downloaded by Ms. DiSanti from the AAA website (see Pl.'s Ex. D), the filing fees charged by the AAA vary depending on the amount of the claim. The stated initial filing fee ranges from $4,250 for claims with a value of over $300,000 to $500,000, to $8,000 for claims with a value of over $1,000,000 to $5,000,000. In addition, the stated case service fee ranges from $1,750 to $3,250, depending on the value of the claim. Plaintiff contends that the amount of her claims falls in the $1,000,000 to $5,000,000 range, thus equating to an initial filing fee of $8,000, plus a ...