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Smaller v. JRK Residential Management Corp.

United States District Court, E.D. Pennsylvania

February 15, 2017



          Schmehl, J.

         Before the Court is the motion of defendants, JRK Residential Group, Inc., and JRK Residential America, LLC to compel arbitration and stay proceedings. Plaintiff, Winifred Smaller (“Smaller”) has opposed the motion and Defendants have filed a reply. Having read the parties' briefs and reviewing all exhibits, and after oral argument on the motion, I will grant Defendants' motion to compel arbitration and stay proceedings.

         I. BACKGROUND

         Plaintiff, a former employee of JRK Residential America, LLC, filed this employment discrimination claim against Defendants, seeking to recover for her alleged wrongful termination. In connection with her employment with JRK Residential America, LLC, Smaller signed a Mediation and Arbitration Agreement (the “Agreement”) which Defendants claim requires her to arbitrate all claims against any JRK subsidiary or affiliated entity arising out of her employment.


         Plaintiff went to work for Defendant JRK Residential America, LLC, on August 4, 2011, and began to work as a property manager at one of Defendants' properties in Lancaster. (Compl. at ¶ 12.) Thereafter, on May 2, 2013, during the course of her employment with Defendant, Smaller signed a mediation and arbitration agreement. (Docket No. 4, Ex. 1-A.) The Agreement contains an arbitration clause that states that any covered claim “arising out of or relating to [Smaller's] employment relationship with JRK or the termination of that relationship” shall be “submit[ted] . . . for final and binding resolution by a private and impartial arbitrator.” (Docket No. 4, Ex. 1-A.) The Agreement identifies the following claims as subject to arbitration:

a. Claims Covered: This Agreement to submit to mediation and (if necessary) binding arbitration covers:
ii. Any claim that could be asserted in court or before an administrative agency for which the employee has an alleged cause of action, including without limitation, the following claims: (a) breach of any contract or covenant (express or implied), (b) tort, (c) discrimination including, but not limited to, discrimination based on sex, pregnancy, race, national or ethnic origin, age, religion, creed, marital status, sexual orientation, mental or physical disability or medical condition or other characteristics protected by statute, (d) wrongful discharge, (e) violations of the Family and Medical Leave Act (FMLA), (f) violations of confidentiality or breaches of trade secrets, and/or (g) violation of any federal, state or other governmental law, statute, regulation or ordinance and whether based on statute or common law…
iii. Claims made against JRK, any of its subsidiary or affiliated entities or its individual employees, officers or directors in an official or personal capacity”

See id. at pg. 2, ¶ 1(a).

         Smaller was terminated by Defendants on July 1, 2014. She then filed an EEOC charge, and was issued a Notice of Right to Sue on February 1, 2016. Plaintiff filed the instant Complaint on April 29, 2016, alleging discrimination, harassment and retaliation based on her race. (Compl. at ¶¶ 5, 20-56.)


         The Federal Arbitration Act (“FAA”), which applies to any dispute in state or federal court concerning contracts affecting interstate commerce, strongly favors resolving disputes through arbitration. Hopkins v. New Day Fin., 643 F.Supp.2d 704, 713 (E.D. Pa. 2009). The FAA states that “A written provision in. . . a contract evidencing a transaction involving commerce to settle by arbitration . . . shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. 9 U.S.C. § 2. It is undisputed that there is a “liberal federal policy favoring arbitration agreements.” Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 24-26 (1991). The FAA “establishes a strong policy in favor of compelling arbitration over litigation, ” Sandvik AB v. Advent Int'l Corp., 220 F.3d 99, 104 (3d Cir. 2000), and arbitration agreements falling within the scope of the FAA “must be rigorously enforce[d].” Perry v. Thomas, 482 U.S. 483, 490 (1987). Further, the Supreme Court has held that employment agreements are subject to the FAA. Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 122-23 (2001).

         IV. ...

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