Filed: Jun. 18, 2004
Latest Update: Mar. 02, 2020
Summary: Opinions of the United 2004 Decisions States Court of Appeals for the Third Circuit 6-18-2004 Palcko v. Airborne Express Precedential or Non-Precedential: Precedential Docket No. 03-2227 Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2004 Recommended Citation "Palcko v. Airborne Express" (2004). 2004 Decisions. Paper 546. http://digitalcommons.law.villanova.edu/thirdcircuit_2004/546 This decision is brought to you for free and open access by the Opinion
Summary: Opinions of the United 2004 Decisions States Court of Appeals for the Third Circuit 6-18-2004 Palcko v. Airborne Express Precedential or Non-Precedential: Precedential Docket No. 03-2227 Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2004 Recommended Citation "Palcko v. Airborne Express" (2004). 2004 Decisions. Paper 546. http://digitalcommons.law.villanova.edu/thirdcircuit_2004/546 This decision is brought to you for free and open access by the Opinions..
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Opinions of the United
2004 Decisions States Court of Appeals
for the Third Circuit
6-18-2004
Palcko v. Airborne Express
Precedential or Non-Precedential: Precedential
Docket No. 03-2227
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2004
Recommended Citation
"Palcko v. Airborne Express" (2004). 2004 Decisions. Paper 546.
http://digitalcommons.law.villanova.edu/thirdcircuit_2004/546
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PRECEDENTIAL David L. DaCosta (Argued)
Joseph J. McAlee
UNITED STATES COURT OF Sprague & Sprague
APPEALS FOR THE THIRD CIRCUIT Philadelphia, PA 19103
Attorneys for Appellee
No. 03-2227
OPINION OF THE COURT
MARGARET PALCKO
SLOVITER, Circuit Judge.
v. The principal questions before us
on this appeal are the scope of the
AIRBORNE EXPRESS, INC., exclusion from the Federal Arbitration Act
Appellant (“FAA”), 9 U.S.C. §§ 1-16 (2004), for a
“class of workers engaged in foreign or
interstate commerce” and the preemptive
effect, if any, of the statutory exclusion.
On Appeal from the United States
I.
District Court
for the Eastern District of Pennsylvania Defendant Airborne Express, Inc.
(D.C. No. 02-cv-02990) (“Airborne”) appeals from the District
District Judge: Hon. Thomas N. O’Neill, Court’s order dated April 23, 2003
Jr. denying Airborne’s motion to compel
arbitration of plaintiff Margaret Palcko’s
claims under Title VII of the Civil Rights
Argued January 12, 2004 Act of 1964 (“Title VII”), 42 U.S.C. §
2000e (2004), and the Pennsylvania
Before: SLOVITER, RENDELL, and Human Relations Act, 43 Pa. Cons. Stat.
ALDISERT, Circuit Judges Ann. §§ 951-963 (2004). Airborne
contends that Palcko is required to
(Filed: June 18, 2004) arbitrate her claims pursuant to a
contractual arbitration agreement based on
the FAA and Washington state law. Its
Sharon M . Erwin (Argued) appeal challenges the District Court’s
Law Offices of Sharon M. Erwin, LLC rulings that Palcko, as a transportation
Philadelphia, PA 19129 worker engaged in interstate commerce, is
excluded from the FAA’s coverage, and
Attorney for Appellant that this FAA exemption preempts
enforcement of Palcko’s arbitration
a g r e e m e n t w i t h A i r b o rn e under App. at 19.
Washington state law.
According to Palcko, once she
II. began performing her duties at Airborne
she encountered immediate resistance and
Airborne is a p a ckage
hostility from the drivers under her
transportation and delivery company that
supervision. She alleges that other
engages in intrastate, interstate, and
Airborne employees falsely accused her of
international shipping. It began employing
sexual misconduct, verbally and physically
Palcko as a Field Services Supervisor in
intimidated her during work, created a
Philadelphia in 1998. Palcko’s duties
hostile work environment through sexist
included supervising between thirty and
remarks, spread offensive rumors about
thirty-five drivers who delivered packages
her sex life and moral character through
from Airborne’s facility near the
Airborne’s internal communications
Philadelphia International Airport to their
system, and generally discriminated
ultimate destinations in the Philadelphia
against her because of her gender. Pl.’s
area, and picked up packages from
Compl. at 3-7. Palcko contends that
customers in the Philadelphia area and
Airborne did not meaningfully investigate
brought them back to Airborne’s facility
and address these incidents, which she
for shipment. Palcko monitored and
reported to the company management.
improved the performance of the drivers
According to Palcko, when her immediate
under her supervision to ensure timely and
supervisor, Michael Matey, told her in the
efficient delivery of packages.
presence of others during a March 5, 2001
When Palcko was hired, she agreed meeting that “[m]aybe you don’t belong in
to enter into a “M utual Agreement to this industry” and “[m]aybe you should
Arbitrate Claims” with Airborne. The just leave,” she left the meeting and never
relevant portions of the Agreement, which returned to her position at Airborne. Pl.’s
covers “all claims,” provides: Compl. at 7. Airborne denies all Palcko’s
f a c t u a l a l l e g a t io n s o f c o m p a n y
Except as provided in this
wrongdoing. Def.’s Answer at 3-6.
Agreement, the Federal
Arbitration Act shall govern Palcko filed a charge against
the i n t e r p r e t a ti o n, Airborne with the Equal Employment
enforcement and all Opportunity Commission on May 31,
proceedings pursuant to this 2001, seeking administrative remedies for
Agreement. To the extent her allegations under Title VII, 42 U.S.C.
that the Federal Arbitration § 2000e-5. After 180 days elapsed without
A c t is inapp licable , a finding by the Commission on Palcko’s
Washington law pertaining charge against Airborne, she requested a
to agreements to arbitrate Dismissal and Notice of Rights from the
shall apply. Commission. 42 U.S.C. § 2000e-5(f)(1).
2
The Commission issued the Dismissal and appeal from the District Court’s order
Notice, thereby exhausting Palcko’s denying its motion to compel arbitration.1
administrative remedies and allowing her Brayman Constr. Corp. v. Home Ins. Co.,
to seek judicial recourse. 319 F.3d 622, 624-25 (3d Cir. 2003).
Palcko contends, however, that because
Palcko filed a complaint against
the District Court found Palcko’s
Airborne in the District Court for the
employment contract to be exempt from
Eastern District of Pennsylvania on May
the FAA, we have no jurisdiction to
20, 2002 under Title VII and the
review that court’s denial of Airborne’s
Pennsylvania Human Relations Act. After
motion to compel arbitration under 9
the parties resolved issues unrelated to this
U.S.C. § 16(a), which is a section of the
appeal pertaining to the service of process,
FAA. Appellee’s Br. at 1.
Airborne filed a motion to compel
arbitration of Palcko’s claims under the
parties’ arbitration agreement. The
1
District Court denied Airborne’s motion 9 U.S.C. § 16(a) states:
on April 24, 2003, holding that Palcko’s (a) An appeal may be taken from–
employment contract is “excluded from the (1) an order–
coverage of the FAA because of the nature (A) refusing a stay of any
of her work.” App. at 14, 17-18. The action under section 3 of
court also found that the exclusionary this title,
effect of the FAA preempts alternative (B) denying a petition
enforcement of the arbitration contract under section 4 of this title
under Washington state law, as such to order arbitration to
enforcement “would directly conflict with proceed,
Congress’s express purpose” of exempting (C) denying an application
a certain class of workers “from a federal under section 206 of this
law otherwise favoring arbitration.” App. title to compel arbitration,
at 18. Airborne now appeals from the (D) confirming or denying
District Court’s order. confirmation of an award
or partial award, or
III.
(E) modifying, correcting,
A. The Federal Arbitration Act or vacating an award;
(2) an interlocutory order
1. Jurisdiction
granting, continuing, or
The District Court had subject modifying an injunction
matter jurisdiction over Palcko’s Title VII against an arbitration that is
claim under 28 U.S.C. §§ 1331, 1343. The subject to this title; or
FAA, 9 U.S.C. § 16(a), provides for (3) a final decision with
appellate jurisdiction over Airborne’s respect to an arbitration
that is subject to this title.
3
Palcko’s contention is without Our jurisdiction over the District
merit. We have held in Sandvik AB v. Court’s order here, therefore, is clear.
Advent International Corporation, 220
2. Exemption Under Section 1 of
F.3d 99 (3d Cir. 2000), that the FAA’s
the FAA
provision for interlocutory appeals of
orders denying motions to compel Section 1 of the FAA provides:
arbitration clearly endows us with
. . . [N]othing herein
appellate jurisdiction even in instances
contained shall apply to
when the validity of the underlying
contracts of employment of
contract to arbitrate is in doubt, as in
seamen, railroad employees,
Palcko’s case with respect to the
or any other class of
arbitration agreement’s reference to the
workers engaged in foreign
FAA. See id. at 100 (stating that the
or interstate commerce.
FAA’s “plain language contemplates
interlocutory appeals from orders” denying 9 U.S.C. § 1.
arbitration because of questions related to
In Circuit City Stores, Inc. v.
the validity of the underlying contract, and
Adams, 532 U.S. 105 (2001), the Supreme
that “other parts of the statute evince clear
Court considered the scope of this
Congressional intent that challenges to
exemption from the FAA. The employer
refusals to compel arbitration be promptly
in that case, Circuit City, sought to compel
reviewed by appellate courts”).
arbitration as provided for in its
Acceptance of Palcko’s argument employment contracts. The Ninth Circuit
would create the curious situation in which held that arbitration was not appropriate
either all district courts’ orders denying because section 1 of the FAA exempts
arbitration based on section 1’s exemption from its coverage all employment
clause would be beyond appellate review, contracts. The Supreme Court reversed,
which contradicts section 16(a)’s plain rejecting the Ninth Circuit’s expansive
language, or the determination of our reading of section 1. The Court noted that
appellate jurisdiction would be contingent “[m]ost Courts of Appeals conclude the
on the outcome of our review of the merits exclusion provision is limited to
of the District Court’s finding on the transportation workers, defined, for
exemption question, which is precisely instance, as those workers ‘actually
what we are barred from doing in the engaged in the movement of goods in
absence of appellate jurisdiction. As we interstate commerce.’” Id. at 112 (citing
stated in Sandvik, “The more natural Cole v. Burns Int’l Security Servs., 105
reading [of Section 16(a) is] to treat all F.3d 1465, 1471 (D.C. Cir. 1997)).
orders declining to compel arbitration as Looking to the statutory language, the
reviewable.”
Id. at 103. No appellate Court applied the interpretation maxim of
court has held to the contrary. ejusdem generis and read the words “any
4
other class of workers engaged in . . . America, 207 F.2d 450, 452 (3d Cir.
commerce,” as giving “effect to the terms 1953), reasoned that Palcko qualifies as a
‘seamen’ and ‘railroad employees.’” transportation worker because her job
Circuit
City, 532 U.S. at 115. The Court “was so closely related [to the transport of
held that the residual phrase “any other the goods] as to be in practical effect part
class of workers engaged . . . in interstate of [the shipping of the goods].” App. at 17
commerce” should “be controlled and (internal quotations omitted). Airborne
defined by reference to the enumerated challenges the court’s finding, arguing that
categories of workers which are recited Palcko, as a “management employee” with
just before it . . . .”
Id. at 115. Reading no close contact with channels of interstate
section 1 in this narrow manner, the Court commerce and not subject to other existing
noted, also concurs with Congress’s intent statutory employment dispute resolution
in enacting the FAA to compel schemes, cannot qualify as an exempt
enforcement of arbitration agreements in worker under section 1 of the FAA.
response to then-prevalent judicial hostility Appellant’s Br. at 27-36.
toward such agreements, especially given
Fifty years ago, this court in Tenney
the fact that more specific and
was required to construe the meaning of
comprehensive fede ral arbitra tion
the exception clause in the context of a
procedures for seamen and railroad
labor dispute. The union sought a stay
employees were already in existence or on
pending arbitration which was provided in
the verge of passage. See id. at 121 (“It
the collective bargaining agreement. The
would be rational for Congress to ensure
parties stipulated that the employer was
that workers in general would be covered
engaged in the manufacture of goods for
by the provisions of the FAA, while
sale in interstate commerce and that the
reserving for itself more specific
employees were eng aged in that
legislation for those engaged in
manufacture and incidental plant
transportation.”) (citation omitted).
maintenance. Presaging the Supreme
To determine whether Palcko’s Court’s holding in Circuit City, we held
employment contract, including the that the exception was inapplicable. We
arbitration agreement, is exempt from the stated that as the language “any other class
FAA’s coverage, we must therefore of workers engaged in foreign or interstate
determine whether Palcko can be commerce” followed seamen and railroad
considered to be a “transportation worker” workers, the rule of ejusdem generis
in a “class of workers . . . engaged in . . . demands that the phrase includes “only
commerce” within the meaning of the those other classes of workers who are
FAA, as interpreted by Circuit City. The likewise engaged directly in commerce,
District Court, citing our decision in that is, only those other classes of workers
Tenney Engineering, Inc. v. United who are actually engaged in the movement
Electrical Radio & Machine Workers of of interstate or foreign commerce or in
5
work so closely related thereto as to be in who physically transported goods across
practical effect part of it.” Tenney, 207 state lines, it would have phrased the
F.2d at 452. The Supreme Court’s later FAA’s language accordingly. 2 We
decision in Circuit City essentially therefore concur with the District Court’s
affirmed the Tenney analysis. 532 U.S. at finding that Palcko’s employment contract
119. with Airborne is exempt from the FAA’s
coverage because she is a transportation
Adopting the narrow interpretation
worker engaged in interstate and foreign
of section 1 stated in Tenney and Circuit
commerce under section 1 of that statute.
City, Airborne argues that Palcko’s work,
as a supervisor, was not only dissimilar to B. The FAA’s Preemptive Effect over
that of seamen or railroad workers, but Washington State Law Governing
also did not directly involve the interstate Arbitration
delivery of packages. She therefore cannot
1. Jurisdiction
be a “transportation worker” in the sense
envisioned by the Court in Circuit City. Airborne also argues that even if its
We do not agree. According to Palcko’s arbitration agreement with Palcko is
affidavit, she was responsible for exempt from the FAA’s coverage, the
“ m o n i t o ri n g a n d i m p rovin g th e
performance of drivers un der my
2
supervision to insure [sic] timely and We are not persuaded by
efficient delivery of packages.” App. at Airborne’s suggestion that the inclusion
67. Such direct supervision of package of Palcko in the class of workers exempt
shipments makes Palcko’s work “so from the FAA’s coverage would create a
closely related [to interstate and foreign “slippery slope” problem that would
commerce] as to be in practical effect part ultimately lead to the exemption of all
of it.” Tenney, 207 F.2d at 452; see “management employees” in the same
generally Great W. Mortgage Corp. v. chain of command. Palcko was a direct
Peacock,
110 F.3d 222, 226-27 (3d Cir. supervisor of Airborne’s drivers that
1997) (declaring that Tenney is still good transported packages, and our decision is
law). based only on her particular relations to
the channels of interstate commerce. In
Airborne suggests that the
this regard Palcko’s situation differs
exemption clause should be limited to
from the employee litigants in Cole, 105
those truck drivers who physically move
F.3d at 1469, and Kropfelder v. Snap-On
the packages. If we were to accept that
Tools Corp., 859 F. Supp. 952 (D. Md.
limitation, we would unnecessarily narrow
1994); neither the railroad security guard
the section 1 exemption in a way never
in Cole nor the warehouse manager in
intended by the FAA; had Congress
Kropfelder was a transportation worker,
intended the residual clause of the
let alone engaged in the transportation of
exemption to cover only those workers
goods interstate.
6
agreement is nonetheless enforceable pendent appellate jurisdiction by Courts of
under the alternative ground that the Appeals, we concluded that “the doctrine
arbitration agreement is valid under should be used ‘sparingly,’ and only where
Washington state law. Before we examine there is sufficient overlap in the facts
the merit of Airborne’s argument, relevant to both the appealable and
however, we must first ascertain whether nonappealable issues to warrant plenary
there is a basis for our jurisdiction to review.” Id. at 203 (emphasis in original).
inquire into this state-law claim.
Here, both the FAA exemption and
The District Court exercised Washington state law issues arise from a
supplemental jurisdiction over Palcko’s single arbitration agreement that provides
Pennsylvania state law cause of action alternative grounds for the arbitration of
under 28 U.S.C. § 1367, and issued an all claims arising from Palcko’s
order denying Airborne’s motion to employment with Airborne. Moreover,
compel arbitration on both FAA and both Palcko’s Title VII and Pennsylvania
Washington state law grounds. While we Human Relations Act claims arise from the
may review Airborne’s appeal with respect same set of facts related to her conditions
to the FAA under 9 U.S.C. § 16(a), that as an Airborne employee. Thus, not only
section does not cover our review of a does sufficient overlap of facts exist to
non-FAA, state-law arbitration claim in an warrant plenary rev iew, b ut the
otherwise nonappealable interlocutory Washington state law arbitration issue is
order. Our ability to review the so closely intertwined with the FAA claim
Washington state law issue before us, if that our taking of pendent appellate
any, must therefore rest on the doctrine of jurisdiction over the former is necessary to
pendent appellate jurisdiction, which is ensure meaningful review of the District
discretionary and narrow in nature. Court’s order in its entirety. We therefore
conclude we may exercise pendent
In E.I. Dupont de Nemours and Co.
appellate jurisdiction over the state-law
v. Rhone Poulenc Fiber and Resin
portion of the District Court’s order.
Intermediates, S.A.S., 269 F.3d 187 (3d
Cir. 2001), we explained that “[t]he 2. Discussion
doctrine of pendent appellate jurisdiction,
The District Court ruled that the
in its broadest formulation, allows an
exemption of Palcko’s employment
appellate court in its discretion to exercise
contract from the FAA’s coverage also
jurisdiction over issues that are not
precludes enforcement of the arbitration
independently appealable but that are
agreement under Washington state law.
intertwined with issues over which the
The court found that “[a]lthough the FAA
appellate court properly and independently
contains no express preemptive provision
exercises its jurisdiction.” Id. at 202-03.
and its preemptive effect is limited, its
Recognizing that the Supreme Court has
preemptive effect does encompass
endorsed, but also limited, the use of
7
questions of arbitrability.” App. at 17. It also Gilmer v. Interstate/Johnson Lane
reasoned that enforcement of the Corp., 500 U.S. 20 (1991) (enforcing
arbitration agreement between Palcko and arbitration clause in a securities
Airborne “in accordance with state laws registration application to cover an Age
favoring arbitration would directly conflict Discrimination in Employment Act claim).
with Congress’s express purpose,” in In doing so, the Supreme Court has held
drafting the exemption clause in section 1 that the FAA represents a “liberal federal
of the FAA, of exempting workers policy favoring arbitration agreements.”
engaged in interstate commerce from Moses H. Cone Mem’l Hospital v.
arbitration. App. at 18. Mercury Constr. Corp.,
460 U.S. 1, 24
(1983). The Court has also stated that
In considering whether the
parties to an arbitration agreement,
inclusion of the exemption clause was
“[h]aving made the bargain to arbitrate . .
intended to preempt state law regarding
. should be held to it unless Congress itself
enforcement of arbitration agreements, we
has evinced an intention to preclude a
must keep in mind that Congress enacted
waiver of judicial remedies for the
the FAA “to ensure judicial enforcement
statutory rights at issue.” Mitsubishi
of privately made agreements to arbitrate,”
Motors Corp. v. Soler Chrysler-Plymouth,
rather than restrict the force of arbitration
Inc., 473 U.S. 614, 628 (1985).
agreements. Dean Witter Reynolds, Inc. v.
Byrd,
470 U.S. 213, 219 (1985). The There is no language in the FAA
Supreme Court has stated that “passage of that explicitly preempts the enforcement of
the Act was motivated, first and foremost, state arbitration statutes. As the Supreme
by a congressional desire to enforce Court explained in Volt Information
agreements into which parties had entered, Sciences, Inc. v. Board of Trustees of
and [courts] must not overlook this Leland Stanford Junior University, 489
principal objective when construing the U.S. 468 (1989), “The FAA contains no
statute, or allow the fortuitous impact of express pre-emptive provision, nor does it
the Act on efficient dispute resolution to reflect a congressional intent to occupy the
overshadow the underlying motivation.” entire field of arbitration.”
Id. at 477
Id. at 220 (footnote omitted). In seeking to (citing Bernhardt v. Polygraphic Co., 350
fulfill the FAA’s purpose, the Court has U.S. 198 (1956), which upheld application
enforced an agreement to arbitrate claims of state arbitration law to an arbitration
under the Securities Act of 1933, even provision in a contract not covered by the
though prior case law stated that the FAA). The Volt Court, in determining
Securities Act’s language prohibits the whether to enforce an arbitration
arbitration of such claims. Rodriguez de agreement using a California procedural
Quijas v. Shearson/American Express, rule that has no counterpart in the FAA,
Inc.,
490 U.S. 477 (1989) (overruling stated that “[t]here is no federal policy
Wilko v. Swan,
346 U.S. 427 (1953)); see favoring arbitration under a certain set of
8
procedural rules; the federal policy is Mason-Dixon Lines, Inc. v. Local Union
simply to ensure the enforceability, No. 560, 443 F.2d 807 (3d Cir. 1971), “In
according to their terms, of private our view, the effect of Section 1 is merely
agreements to arbitrate.”
Id. at 476. The to leave the arbitrability of disputes in the
Court then ruled that the application of the excluded categories as if the [Federal]
California procedural rule to stay Arbitration Act had never been enacted.”
arbitration to the agreement, in accordance
Id. at 809.3 Here, enforcement of the
with a choice-of-law provision contained arbitration agreement between Palcko and
therein, is appropriate because while “state Airborne under Washington state law, as if
law may nonetheless be pre-empted [by the FAA “had never been enacted,” does
the FAA] to the extent that it actually not contradict any of the language of the
conflicts with federal law – that is, to the FAA, but in contrast furthers the general
extent that it stands as an obstacle to the policy goals of the FAA favoring
accomplishment and execution of the full arbitration. We will therefore remand so
purposes and objectives of Congress,” the that the District Court can take the actions
application of the state procedural rule, “in necessary to enforce the arbitration
accordance with the terms of the agreement under Washington state law.
arbitration agreement itself, would [not]
C. Whether Airborne Waived Its Right
undermine the goals and policies of the
to Arbitration
FAA.” Id. at 477-78 (internal quotations
and citations omitted). Palcko also argues on appeal that
Airborne has waived its right to arbitration
Applying the Supreme Court’s
precedent, we conclude that the District
Court erred in holding that Palcko’s
3
exemption status under section 1 of the Although Mason-Dixon Lines
FAA preempts the enforcement of the involved the different issue of staying
arbitration agreement under Washington judicial proceedings pending arbitration
state law. It is telling that the arbitration under an agreement excluded from
agreement itself envisioned the possibility section 1 of the FAA, the principle we
that Palcko’s employment contract would put forth in that case regarding the
be deemed exempt from the FAA’s exclusionary effect of section 1 on other
coverage under section 1 of the Act. It arbitration issues not related to the FAA
provided for that contingency by including is equally applicable here. The case also
the following: “To the extent that the demonstrates that enforcing the
Federal Arbitration Act is inapplicable, arbitration agreement under Washington
Washington law pertaining to agreements state law does not contradict our finding
to arbitrate shall apply.” App. at 19. We above that Palcko’s employment
see no reason to release the parties from contract, of which the arbitration
their own agreement. We stated in agreement is a part, is exempted from the
FAA’s coverage.
9
by failing to include it in its initial motion (g) Consolida tion of
to dismiss on the ground of alleged Defenses in Motion. A
defective service of process under Federal party who makes a motion
Rule of Civil Procedure 12(b). Palcko’s under this rule may join
argument is unpersuasive. Rule 12 deals with it any other motions
with defenses and objections by pleading herein provided for and then
or motion. The relevant portions of Rule available to the party. If a
12, for Palcko’s purposes, are as follows: party makes a motion under
this rule but omits therefrom
(b) How Presented. Every
any defense or objection
defense, in law or fact, to a
then available to the party
claim for relief in any
which this rule permits to be
pleading, whether a claim,
raised by motion, the party
counterclaim, cross-claim,
shall not thereafter make a
or third-party claim, shall be
motion based on the defense
asserted in the responsive
or objection so omitted,
pleading thereto if one is
except a motion as provided
required, except that the
in subdivision (h)(2) hereof
following defenses may at
on any of the grounds there
the option of the pleader be
stated.
made by motion: (1) lack of
jurisdiction over the subject (h) Waiver or Preservation
m a t t e r , ( 2 ) la c k o f of Certain Defenses.
jurisdiction over the person,
(1) A defense of lack
(3) improper venue, (4)
of jurisdiction over the
insufficiency of process, (5)
person, improper venue,
insufficiency of service of
insufficiency of process, or
process, (6) failure to state a
insufficiency of service of
claim upon which relief can
process is waived (A) if
be granted, (7) failure to
omitted from a motion in the
join a party under Rule 19.
circumstances described in
A motion making any of
subdivision (g), or (B) if it is
these defenses shall be made
neither made by motion
before pleading if a further
under this rule nor included
pleading is permitted. No
in a responsive pleading or
defense or objection is
an amen dmen t thereof
waived by being joined with
permitted by Rule 15(a) to
one or more other defenses
be made as a matter of
or objections in a responsive
course.
pleading or motion. . . .
10
(2) A defense of support Palcko’s creative theory. The only
failure to state a claim upon support Palcko has cited is a Pennsylvania
which relief can be granted, state cour t decisio n interp retin g
a defense of failure to join a Pennsylvania state rules of civil procedure.
party indispensable under Wilk v. Ravin, 46 Pa. D. & C. 4th 347 (Ct.
Rule 19, and an objection of Com. Pl. Allegheny County 1991);
failure to state a legal Appellant’s Reply Br. at 13. Wilk is of
defense to a claim may be little relevance to interpretation of federal
made in any pleading procedural rules. Our prior decisions
permitted or ordered under support the traditional practice of treating
Rule 7(a), or by motion for a motion to compel arbitration as a motion
judgment on the pleadings, to dismiss for failure to state a claim upon
or at the trial on the merits. which relief can be granted. See
Nationwide Ins. Co. v. Patterson, 953 F.2d
Fed. R. Civ. P. 12(b), (g), (h).
44, 45 n.1 (3d Cir. 1991) (“Dismissal of a
Palcko contends that although declaratory judgment action because the
motions to dismiss based on the existence dispute is covered by an arbitration
of an arbitration agreement are most provision is generally effected under Rule
commonly filed under Rule 12(b)(1) (lack 12(b)(6) covering dismissals for failure to
of subject matter jurisdiction) or Rule state a claim upon which relief can be
12(b)(6) (failure to state a claim upon granted, see, e.g., Aetna Casualty & Surety
which relief can be granted), that practice Co. v. Hameen, 758 F. Supp. 1049 (E.D.
is inappropriate and that motions to Pa. 1990), . . . .”).
dismiss based on an arbitration agreement
Allowing a waiver of the right to
are more appropriately brought under Rule
arbitration based on Rule 12(h)(1) would
12(b)(2) (lack of personal jurisdiction) or
undermine the strong judicial posture
Ru le 12(b)(3) (improper venue). 4
favoring arbitration as discussed above.
Appellee’s Br. at 14. Palcko’s novel
Our precedent holds that waiver of
categorization of the arbitration agreement
arbitration rights “is not to be lightly
claim is critical to her waiver argument
inferred” by federal courts. PaineWebber
because motions under Rule 12(b)(1) and
Inc. v. Faragalli, 61 F.3d 1063, 1068 (3d
(b)(6) are not waived under Rule 12(h)(1),
Cir. 1995) (quoting Gavlik Constr. Co. v.
but motions under Rule 12(b)(2) and (b)(3)
H.F. Campbell Co., 526 F.2d 777, 783 (3d
are.
Cir. 1975)). We have also stated that
Existing legal authorities do not “prejudice is the touchstone for
determining whether the right to arbitrate
has been waived.” Hoxworth v. Blinder,
4
Improper venue claims fall within Robinson & Co., Inc., 980 F.2d 912, 925
Rule 12(b)(3); Palcko incorrectly cited (3d Cir. 1992); see also Thyssen, Inc. v.
Rule 12(b)(4).
11
Calypso Shipping Corp., 310 F.3d 102 (2d remand for further proceedings consistent
Cir. 2002) (ruling that no waiver exists with this opinion.
even though defendant did not seek
arbitration until more than eighteen
months after the suit was filed and after
plaintiff filed a motion for partial summary
judgment).
Although we found prejudice in
Hoxwo rth because defendants had
engaged in extensive pretrial practice
(including filing a motion to dismiss for
failure to state a claim) in the more than
eleven months prior to filing a motion to
compel arbitration, Hoxworth, 980 F.2d at
925, nothing in the record suggests that
Palcko has suffered a similar adverse
effect here. Airborne filed its motion to
compel arbitration within thirty-eight days
of learning of the lawsuit and within
roughly twenty-two days of filing its initial
motion to dismiss for insufficiency of
service of process. Appellant’s Reply Br.
at 12 n.2. Airborne had also requested that
Palcko voluntarily agree to arbitration ten
days before filing its motion to compel
arbitration. Appellant’s Reply Br. at 14.
Although the length of the time period
involved alone is not determinative,
Palcko has failed to show what adverse
effects, if any, she has suffered within that
short period of time. Therefore waiver
cannot be inferred from the facts of this
case.
IV.
For the above reasons, we will
reverse the order of the District Court
denying enforcement of the arbitration
agreement under Washington state law and
12
