ANITA B. BRODY, District Judge.
Plaintiff Nancy J. Zeller-Landau brings suit against Defendants Sterne Agee CRT, LLC ("Sterne Agee CRT"), CRT Capital Group, LLC ("CRT"), CRT Greenwich, LLC ("Greenwich"), and Aquiline Capital Partners, LLC ("Aquiline").
In the fall of 2010, Zeller-Landau began working for Sterne Agee, Group, Inc. ("Sterne Agee Group") as a Managing Director in the West Conshohocken, PA office (the "Conshohocken Office"). Compl. ¶ 10. In March 2015, Aquiline, CRT, and Greenwich purchased Sterne Agee Group and the new company became known as Sterne Agee CRT. Compl. ¶ 11. Accordingly, in March 2015, Zeller-Landau agreed to enter into an Employment Agreement with CRT. CRT's Mem. Ex. A, at 9, ECF No. 8-2 [hereinafter Agrmt.]. In April 2015, the Employment Agreement became effective. Agrmt. 9. The Employment Agreement contains the following arbitration provision:
Agrmt. § XIII.F.
Zeller-Landau is female. Compl. ¶ 9. Throughout her employment with Sterne Agee Group and Sterne Agee CRT, the vast majority of Zeller-Landau's similarly situated coworkers were male. Compl. ¶ 20. From 2014 until March of 2016, Zeller-Landau earned $39,583.00 per month. Compl. ¶¶ 15, 18. In March 2016, the method for compensating Zeller-Landau changed. Compl. ¶ 18. As a result, Zeller-Landau's pay was reduced from $39,583.00 per month to approximately $10,000.00 per month. Compl. ¶ 18. In April 2016, Zeller-Landau learned that when Sterne Agee Group became Sterne Agee CRT similarly situated coworkers, the vast majority of whom were men, were paid substantial retention bonuses, even though a bonus was never provided to Zeller-Landau. Compl. ¶ 16. During her employment, Defendants paid Zeller-Landau substantially less than her male counterparts. Compl. ¶ 19.
On June 23, 2016, CRT notified Zeller-Landau that it was closing the Conshohocken Office and that Zeller-Landau was being laid off from her employment. Compl. ¶ 22. Zeller-Landau was offered a severance package based on her reduced monthly compensation of $10,000.00 per month. Compl. ¶ 23. Zeller-Landau's male counterparts were offered substantially more compensation in their severance packages than Zeller-Landau was offered. Compl. ¶ 24.
Zeller-Landau alleges that "Defendants treated male employees more favorably when it came to compensation, benefits, work assignments and career advancement." Compl. ¶ 26.
On September 5, 2017, Zeller-Landau filed this Complaint, alleging that Defendants subject her to sex discrimination in violation of Title VII, the PHRA, and the Equal Pay Act. CRT now moves to compel arbitration and stay the proceedings based on the arbitration provision in its Employment Agreement with Zeller-Landau.
CRT moves to compel arbitration and stay proceedings pursuant to the Federal Arbitration Act, 9 U.S.C. § 1 et seq. ("FAA").
"The strong federal policy favoring arbitration, however, does not lead automatically to the submission of a dispute to arbitration upon the demand of a party to the dispute." Id. at 523. "Because arbitration is a matter of contract, before compelling arbitration pursuant to the Federal Arbitration Act, a court must determine that (1) a valid agreement to arbitrate exists, and (2) the particular dispute falls within the scope of that agreement." Kirleis v. Dickie, McCamey & Chilcote, P.C., 560 F.3d 156, 160 (3d Cir. 2009) (citation omitted).
"[T]he fact that the parties have agreed to arbitrate some disputes does not necessarily manifest an intent to arbitrate every dispute that might arise between the parties . . . ." CardioNet, Inc. v. Cigna Health Corp., 751 F.3d 165, 172 (3d Cir. 2014). "[A] court may order arbitration of a particular dispute only where the court is satisfied that the parties agreed to arbitrate that dispute." Granite Rock Co. v. Int'l Bhd. of Teamsters, 561 U.S. 287, 297 (2010). "[F]ederal policy favors arbitration and thus a court resolves doubts about the scope of an arbitration agreement in favor of arbitration." Medtronic AVE, Inc. v. Advanced Cardiovascular Sys., Inc., 247 F.3d 44, 55 (3d Cir. 2001). However, "the presumption of arbitrability applies only where an arbitration agreement is ambiguous about whether it covers the dispute at hand. Otherwise, the plain language of the contract controls." CardioNet, 751 F.3d at 173 (citation omitted).
"Ultimately, then, whether a dispute falls within the scope of an arbitration clause depends upon the relationship between (1) the breadth of the arbitration clause, and (2) the nature of the given claim." Id. at 172. In making this assessment, the "focus is on the factual underpinnings of the claim rather than the legal theory alleged in the complaint." Medtronic, 247 F.3d at 55 (quoting Svedala Indus., Inc. v. Rock Engineered Mach. Co., Inc., No. 96-4538, 1996 WL 590861, at *3 (E.D. Pa. Oct. 11, 1996)). Moreover, whether a dispute falls within the scope of an arbitration clause is a matter of federal law.
To determine whether a dispute falls within the scope of an arbitration clause, a court "begin[s] by `carefully analyz[ing] the contractual language' in the arbitration clause at issue." CardioNet, 751 F.3d at 173 (quoting Trap Rock Indus., Inc. v. Local 825, Int'l Union of Operating Eng'rs, 982 F.2d 884, 888 (3d Cir. 1992)). The Employment Agreement contains the following arbitration provision:
Agrmt. § XIII.F. CRT contends that Zeller-Landau's sex discrimination claims are not within the scope of the arbitration agreement based on the principle expressio unius est exclusio alterius, which means the specific inclusion of one thing is the exclusion of another.
"[W]hen phrases such as `arising under' and `arising out of' appear in arbitration provisions, they are normally given broad construction . . . ." Battaglia v. McKendry, 233 F.3d 720, 727 (3d Cir. 2000). Arbitration clauses that govern any disputes "arising out of or relating to" the parties' agreement or an employee's employment are also considered broad in scope. See, e.g., DCK N. Am., LLC v. Burns & Roe Servs. Corp., 218 F.Supp.3d 465, 475 (W.D. Pa. 2016); TMG Health, Inc. v. UnitedHealth Grp., Inc., No. 07-115, 2007 WL 1258133, at *1 (E.D. Pa. Apr. 27, 2007); Kane v. Advanced Integrated Techs. Grp., Inc., No. 07-269, 2007 WL 1237926, at *4 (E.D. Pa. Apr. 25, 2007); Hearon v. AstraZeneca LP, No. 02-3189, 2003 WL 21250640, at *5 (E.D. Pa. Mar. 24, 2003). Additionally, phrases in an arbitration clause such as "arbitrable matters include, but are not limited[] to" are also indicative of an arbitration clause that is broad in scope. See Chassen v. Fidelity Nat'l Fin., Inc., 836 F.3d 291, 304 (3d Cir. 2016); Cf. United Steelworkers of Am., AFL-CIO-CLC v. Rohm & Haas Co., 522 F.3d 324, 331 (3d Cir. 2008) ("Cases holding that the arbitration clauses at issue are narrow have generally relied on language expressly limiting the scope of the clause to specific subject matter."). Thus, the arbitration provision contained in Zeller-Landau's Employment Agreement is broad in scope.
Courts within the Third Circuit have held that broad arbitration clauses in employment agreements encompass statutory claims such as the claims raised by Zeller-Landau. See Esaka v. Nanticoke Health Servs., Inc., 752 F.Supp.2d 476, 482-83 (D. Del. 2010) (concluding that Title VII claims fell within the scope of a clause submitting to arbitration "all claims or controversies concerning this Agreement or arising in any way out of the performance of this Agreement"); Gillespie v. Colonial Life & Acc. Ins. Co., No. 08-689, 2009 WL 890579, at *7 (W.D. Pa. Mar. 30, 2009) (concluding that Title VII and PHRA claims fell within the scope of an arbitration clause that required "every claim, controversy or dispute arising out of or related to this Agreement, or the breach thereof, . . . [to] be settled by binding arbitration"); Hearon, 2003 WL 21250640, at * 6-7 (concluding that Title VII and PHRA claims fell within the scope of an arbitration clause that required any claim "arising out of or relating to any provision of this Contract or the Employee's termination . . . [to] be settled by arbitration"). All of Zeller-Landau's sex discrimination claims arise out of or relate to her employment with CRT or the termination of that employment. Because the arbitration clause is broad in scope and covers "any claim, dispute or controversy that arises out of or related to Employee's employment with Employer or the termination of that employment," it encompasses Zeller-Landau's sex discrimination claims.
In an effort to avoid this conclusion, Zeller-Landau points out that the arbitration clause mandates "FINRA arbitration [as] the exclusive means of, and forum for, resolving any claim, dispute or controversy," Agrmt. § XIII.F, and contends that arbitration of her sex discrimination claims would violate FINRA arbitration rules.
In ING Financial Partners v. Johansen, 446 F.3d 777 (8th Cir. 2016), the Eighth Circuit addressed a similar argument. In Johansen, the employee had signed an agreement that contained the following arbitration clause: "Any dispute, claim or controversy arising out of or relating to this Agreement, or the breach thereof, shall be settled by arbitration conducted . . . in accordance with the rules of the National Association of Security Dealers, Inc." Johansen, 446 F.3d at 778. The National Association of Securities Dealers, Inc. ("NASD") Code of Arbitration Procedure provided, in relevant part: "A claim alleging employment discrimination, including a sexual harassment claim, in violation of a statute is not required to be arbitrated. Such a claim may be arbitrated only if the parties have agreed to arbitrate it, either before or after the dispute arose." Id. (quoting NASD Code Rule 10201(b)). The employee alleged claims of sex discrimination, sexual harassment, and retaliatory discharge for whistleblowing. Id. The employer argued that these claims could not be subject to arbitration because arbitration would violate the NASD rule that prohibited arbitration of employment discrimination claims, unless the parties had agreed to arbitrate them. Id. The Eighth Circuit noted that the "arbitration clause was not drafted to specifically limit the agreement to arbitrate to those matters that NASD rules required to be arbitrated, [rather] the reference to the NASD rules appear[ed] to relate only to the manner in which the arbitration shall be conducted, not which matters [were] subject to arbitration" Id. at 779. The Eighth Circuit acknowledged that the "broadly worded" arbitration clause indicated that the parties had agreed to arbitrate the employee's employment discrimination claims. Id. at 779. Accordingly, the Eighth Circuit concluded that the employment discrimination claims were subject to arbitration. Id. at 779-781.
Similar to Johansen, the arbitration clause in the Employment Agreement was not drafted to limit arbitration only to those matters required to be arbitrated by the FINRA arbitration rules. Rather, the parties referenced FINRA arbitration to indicate the forum and means by which arbitration would occur. As previously discussed, the broad arbitration provision covers "any claim, dispute or controversy that arises out of or related to Employee's employment with Employer or the termination of that employment." Although the arbitration clause lists some types of claims covered, it does not limit the types of claims covered to those explicitly identified; rather it includes them as examples "including [them] without limitation" to any other claims that may be covered. Because Zeller-Landau's sex discrimination claims arise out of or relate to her employment with CRT or the termination of that employment, the parties agreed to arbitrate Zeller-Landau's claims when they entered into an Employment Agreement with such a broad arbitration provision.
For the reasons set forth above, I will grant CRT's motion to compel arbitration and to stay proceedings.
9 U.S.C. § 3. Section 4 of the FAA provides, in pertinent part:
9 U.S.C. § 4. "[I]t makes no practical difference whether the court enters an order in an ongoing suit compelling arbitration [under § 4] or merely stays its own proceedings [under § 3]. In either event, arbitration is the sine qua non before proceeding." Zosky v. Boyer, 856 F.2d 554, 556 (3d Cir. 1988), abrogated on other grounds by Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79 (2000).