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Golden Gate National Senior Care, LLC v. Bateman

United States District Court, M.D. Pennsylvania

March 10, 2017

GOLDEN GATE NATIONAL SENIOR CARE LLC, et al., Petitioners
v.
DONNA M. BATEMAN, Administratrix for the Estate of DORIS J. SNYDER, deceased, Respondent

          ORDER

          Kane Judge

         Before the Court is Petitioners Golden Gate National Senior Care LLC's, et al., [1] motion to compel arbitration and stay state court proceedings. (Doc. No. 7.) For the following reasons, the Court will deny without prejudice the motion to compel.

         I. BACKGROUND

         Petitioners are eight business entities (Doc. No. 1 ¶¶ 2-9), and Respondent Donna M. Bateman is the administratrix of the estate of her mother Doris J. Snyder (Id. ¶¶ 11-12). From June 15, 2012 to March 15, 2014, Snyder resided at one of Petitioners' nursing home facilities, Golden LivingCenter - West Shore Facility (“the Facility”), in Camp Hill, Pennsylvania. (Id. ¶ 11.) Around the time of Snyder's admission to the Facility, Respondent Bateman allegedly signed an arbitration agreement (“Arbitration Agreement”) on Synder's behalf and pursuant to a durable power of attorney dated March 15, 2012. (Id. ¶¶ 18-19.)

         On April 25, 2016, Respondent Bateman filed a complaint in the Court of Common Pleas of Cumberland County, Pennsylvania against the Petitioners, Beverly Fry, and Denise Curry. (Doc. Nos. 1 ¶ 26; 1-2.) In her state-court complaint, Respondent Bateman brought three counts against Respondents, alleging inter alia that Petitioners insufficiently staffed the Facility, failed to provide the resources necessary for Snyder, and caused injury to Snyder as of result of their negligence, carelessness, and recklessness. (Doc. No. 1-2 ¶¶ 42, 46, 51, 89, 105-109, 120, 129.) Respondent Bateman brought her second and third count pursuant to 42 Pa. C.S. § 8302 (“Survival Statute”) and 42 Pa. C.S. § 8301 (“Wrongful Death Statute”), respectively. (Id. ¶¶ 124, 133.)

         On May 16, 2016, Petitioners filed a petition for order compelling arbitration with this Court. (Doc. No. 1.) In their petition, Petitioners bring a count to compel arbitration under the Federal Arbitration Act (“FAA”), 9 U.S.C. §§ 1-16, a count to enjoin Respondent from pursuing the state-court action, and a count for declaratory relief. (Id.) Petitioners attach the Arbitration Agreement to their petition. (Doc. No. 1-3.) On May 27, 2016, Petitioners filed a motion to compel arbitration pursuant to the FAA, 9 U.S.C. §§ 1-16. (Doc. No. 7.) Petitioners filed a brief in support on May 27, 2016 (Doc. No. 8.) Respondent filed a brief in opposition on July 7, 2016 (Doc. No. 13), a motion for leave to file a supplemental brief and for arbitration-related discovery on July 25, 2016 (Doc. No. 16), and a supplemental brief in opposition on July 25, 2016 (Doc. No. 17).

         On March 7, 2017, the parties informed this Court that, in accordance with a December 8, 2016 stipulated order in the underlying state court proceedings, the parties have begun to conduct arbitration-related discovery in order for Respondent to “explore her contract defenses.” (Doc. No. 30-1 ¶¶ 4, 6; 31 at 7.) The parties also report being currently engaged in a discovery dispute in the underlying state court proceedings over the deposition of an admissions employee. (Doc. No. 30 at 2-3; 31 at 2.) Petitioners' motion to compel has been fully briefed and is now ripe for disposition.

         II. LEGAL STANDARD

         The Federal Arbitration Act (“FAA”), 9 U.S.C. §§ 1-16, provides the “body of federal substantive law establishing and governing the duty to honor agreements to arbitrate disputes” and expresses a “strong federal policy in favor of resolving disputes through arbitration.” Century Indem. Co. v. Certain Underwriters at Lloyd's, London, 584 F.3d 513, 522 (3d Cir. 2009). Even in light of the FAA, however, arbitration is “strictly a matter of contract.” Bel-Ray Co. v. Chemrite (Pty) Ltd., 181 F.3d 435, 444 (3d Cir. 1999). “If a party has not agreed to arbitrate, the courts have no authority to mandate that he do so.” Id. “Thus, in deciding whether a party may be compelled to arbitrate under the FAA, we first consider ‘(1) whether there is a valid agreement to arbitrate between the parties and, if so, (2) whether the merits-based dispute in question falls within the scope of that valid agreement.'” Flintkote Co. v. Aviva PLC, 769 F.3d 215, 220 (3d Cir. 2014) (quoting Century Indem., 584 F.3d at 527).

         As to the first question, the United States Court of Appeals for the Third Circuit has recently clarified “the standard for district courts to apply when determining whether, in a specific case, an agreement to arbitrate was actually reached.” Guidotti v. Legal Helpers Debt Resolution, L.L.C., 716 F.3d 764, 771 (3d Cir. 2013). In effect, to determine whether there is a valid agreement to arbitrate, a district court “must initially decide whether the determination is made under Fed.R.Civ.P. 12(b)(6) or 56.” Sanford v. Bracewell & Guiliani, LLP, No. 14-1763, 2015 WL 4035614, at *2 (3d Cir. July 2, 2015). The Rule 12(b)(6) standard is appropriate where “it is apparent, based on ‘the face of a complaint, and documents relied upon in the complaint, ' that certain of a party's claims ‘are subject to an enforceable arbitration clause.'” Guidotti, 716 F.3d at 776; accord Sanford, 2015 WL 4035614, at *2. In such cases, a court may “consider only the complaint, exhibits attached to the complaint, matters of public record, as well as undisputedly authentic documents if the complainant's claims are based upon these documents.” Guidotti, 716 F.3d at 772 (quoting Mayer v. Belichick, 605 F.3d 223, 230 (3d Cir. 2010)).

         In contrast, the Rule 56 standard is appropriate: (1) where “the motion to compel arbitration does not have as its predicate a complaint with the requisite clarity to establish on its face that the parties agreed to arbitrate, ” or (2) where “the opposing party has come forth with reliable evidence that is more than a naked assertion ... that it did not intend to be bound by the arbitration agreement, even though on the face of the pleadings it appears that it did.” Guidotti, 716 F.3d at 774; accord Sanford, 2015 WL 4035614, at *2. In such cases, the district court should allow limited discovery on the question of arbitrability before “entertaining [the] motion [to compel arbitration] under a summary judgment standard.” Guidotti, 716 F.3d at 780.

         III. DISCUSSION

         Petitioners move the Court to determine that a valid agreement to arbitrate exists under the Rule 12(b)(6) standard, compel arbitration, and stay the state court proceedings. (Doc. No. 7.) Respondent contends that her wrongful death claims are not subject to arbitration because Petitioners did not obtain the signatures of two wrongful death beneficiaries. (Doc. No. 13 at 3.) As to Respondent's survival claims, she seeks an opportunity to conduct discovery to determine whether a “meeting of the minds” occurred, whether any contract defenses exist, and whether Petitioners' relationship with their arbitration provider, JAMS, “poses a real threat to an injured resident's ability to a fair and impartial proceeding.” (Id. at 9-11.)

         As discussed above, the Court must decide (1) whether the complaint facially establishes arbitrability; and (2) if so, whether Plaintiff has put forward “reliable evidence that is more than a naked assertion ... that it did not intend to be bound by the arbitration agreement, even though on the face of the pleadings it appears that it did.” Guidotti, 716 F.3d at 774.[2] This inquiry requires the Court to distinguish between (1) a “mere naked assertion that [Plaintiff] did not intend to be bound by the terms” of an arbitration agreement and (2) a ...


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