Opinion
C.A. No. 23-243 WES
2023-09-12
Rev. William BOOTH, Plaintiff, v. CITIZENS BANK, N.A., and Nabeel Bhatti, Defendants.
Olugbenga O. Abiona, Abiona Law, PLLC, Philadelphia, PA, for Plaintiff. Brenna Anatone Force, Geoffrey W. Millsom, Adler Pollock & Sheehan PC, Providence, RI, Craig Lamar Chaney, Wade Clark Mulcahy LLP, Springfield, NJ, for Defendant Citizens Bank, N.A.
Olugbenga O. Abiona, Abiona Law, PLLC, Philadelphia, PA, for Plaintiff. Brenna Anatone Force, Geoffrey W. Millsom, Adler Pollock & Sheehan PC, Providence, RI, Craig Lamar Chaney, Wade Clark Mulcahy LLP, Springfield, NJ, for Defendant Citizens Bank, N.A. MEMORANDUM AND ORDER WILLIAM E. SMITH, District Judge.
Currently before the Court is Defendant Citizens Bank's Motion to Stay or Dismiss this action pending completion of arbitration, ECF No. 25. For the reasons that follow, the Court GRANTS the motion. Accordingly, the case is DISMISSED. I. BACKGROUND
Plaintiff Reverend William Booth has brought this suit alleging race discrimination pursuant to 42 U.S.C. § 1981 and the New Jersey Law Against Discrimination ("NJLAD"), N.J. Stat. § 10:5-1 et seq., and intentional infliction of emotional distress against Citizens Bank ("Citizens") and alleged Citizens employee Nabeel Bhatti. Plaintiff alleges the following:
Citizens avers that it has no record of an employee by that name. Def.'s Mem. Supp. Mot. Dismiss or Stay ("Def.'s Mem.") 1, ECF No. 25-1. According to its records, Citizens had an employee Humayun Bhatti (nicknamed "Nabeel") until November 2018 - leaving before the alleged incident in 2021. Id. at 12. According to Citizens, Plaintiff is "confused" as to the bank at the heart of this matter as "a Google search reveals a LinkedIn page for a 'Nabeel Bhatti' who has worked at PNC Bank since 2020" and Plaintiff also banks with PNC Bank. Id. (citing Compl. ¶¶ 11, 18). At this juncture, however, the allegations contained in the Complaint regarding Mr. Bhatti's employment must be taken as true. See Part II infra. Thus, the Court assumes that Defendant Bhatti worked for Citizens at the time in question.
In early 2021, Plaintiff opened both a savings and checking account with Citizens. Compl. ¶ 9, ECF No. 1. As part of the account opening process, Plaintiff signed a "signature card" that provided:
I have received a copy of the Citizen Bank Disclosures and Addendums as applicable. By signing below, I acknowledge that I have read and understood the Bank's Deposit Account Agreement and related fee schedule, Pledge Regarding the Responsible Use and Protection of Customer Information and any other documents that the Bank provided to me about my Account and Account services . . . By signing below, I agree to all the terms of the Agreement.PX2, ECF No. 26-1. Separate from the signature card is Citizens' Personal Deposit Account Agreement ("PDAA"), which contains an arbitration provision that specifies that a Rhode Island court shall resolve issues regarding the details of the arbitration provision. DXB 26-27, ECF No. 10-5.
When Plaintiff opened the savings account, he deposited $8,000 into the account and, later, transferred another $280,000 from a different bank into the savings account. Compl. ¶¶ 10-11. Several weeks later, Plaintiff visited one of Citizens' locations to, among other things, withdraw $5,000 from his savings account. Id. ¶ 12.
At the bank, Plaintiff approached the counter and requested assistance from a manager. Id. ¶¶ 13-14. The teller, Mr. Bhatti, informed him that no manager was available. Id. ¶ 14. When asked about the $5,000 withdrawal, Mr. Bhatti told Plaintiff that "as a company policy, the bank doesn't keep that amount of money in it. If you want to make a withdrawal of that amount, you must call ahead to schedule a withdrawal, when it is a large sum of money." Id. ¶¶ 15-16. Plaintiff contends that no such policy exists and that Mr. Bhatti's statements were false. Id. ¶¶ 15, 17.
Rather than withdrawing the desired amount, Plaintiff was able to withdraw only $2,500. Id. ¶ 19. To withdraw the money, Plaintiff had to provide photo identification - here, his driver's license. Id. Then, to confirm Plaintiff's identity, Mr. Bhatti asked Plaintiff to remove his face mask. Id. During this process, Plaintiff, who is Black, observed three white customers make withdrawals with help from other tellers who did not require mask removal. Id. ¶ 20. Plaintiff contends that Mr. Bhatti treated him "differently and in an abrasive manner." Id.
Plaintiff does not specify the nature of those transactions, merely alleging that the customers left "with their cash envelopes in hand." See Compl. ¶ 20, ECF No.1.
During the transaction, Mr. Bhatti observed that Plaintiff had a large amount of money in his savings account that was not accruing any interest and asked if a bank officer could contact Plaintiff to discuss more beneficial options. See id. ¶ 22. Plaintiff said yes, planning to make a formal complaint about Mr. Bhatti's conduct. Id. ¶ 23. A few days later, an investment officer for Citizens called Plaintiff, and Plaintiff explained that he felt racially profiled and discriminated against. Id. During the conversation, the officer expressed confusion as to why Mr. Bhatti would have refused to allow the $5,000 cash withdrawal and informed Plaintiff that she would investigate what happened and call back. Id. But no one from Citizens ever followed up with Plaintiff about his report. Id.
Plaintiff then commenced this action in the District of New Jersey. Citizens moved to transfer venue or, in the alternative, dismiss or stay the action and compel arbitration, relying on the forum selection clause in the Arbitration provision contained in the PDAA. Mot. Transfer 7-10, ECF No. 10. The Court, Kugler, J., granted the motion, determining that Plaintiff was subject to the forum selection clause, despite his arguments to the contrary. Op. 8, ECF No. 21. Accordingly, the case was transferred to the District of Rhode Island. See ECF Nos. 22, 23.
The provision specifically provides: "ANY DISPUTE CONCERNING THE VALIDITY, ENFORCEABILITY, COVERAGE OR SCOPE OF THIS ARBITRATION AGREEMENT SHALL BE RESOLVED IN A RHODE ISLAND STATE OR FEDERAL COURT OF LAW, AND THE PARTIES HEREBY SUBMIT TO THE JURISDICTION OF SUCH A COURT FOR SUCH PURPOSE." DXB 26, ECF No. 10-5.
Now, Citizens argues that this Court should enforce the arbitration provision contained in the PDAA and either dismiss this case or stay the case pending completion of arbitration. Def.'s Mem. Supp. Mot. Dismiss or Stay ("Def.'s Mem.") 1, ECF No. 25-1. II. LEGAL STANDARD
"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)); see also Douglas v. Hirshon, 63 F.4th 49, 55 (1st Cir. 2023). In this inquiry, the Court considers the Complaint, "documents the authenticity of which are not disputed by the parties[,] . . . documents central to the plaintiffs' claim[s,]" and "documents sufficiently referred to in the complaint." Curran v. Cousins, 509 F.3d 36, 44 (1st Cir. 2007) (citation and quotations omitted). III. DISCUSSION
"[T]here is a split in authority as to whether [motions to dismiss based on arbitrability] must be brought pursuant to Rule 12's section (b)(1) or section (b)(6), . . . or perhaps considered with an analysis entirely separate from the Rule 12(b) rubric." Álvarez-Maurás v. Banco Pop. of P.R., 919 F.3d 617, 623 n.8 (1st Cir. 2019) (citation and quotations omitted). The First Circuit has not chosen a preferred path for such claims. See id. Here, however, the Court's ruling does not rest on evidentiary findings; thus, the distinctions between these potential paths are immaterial. See id.
The Court's analysis is governed by the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1, et seq., which applies to arbitration agreements "affecting [interstate] commerce," Citizens Bank v. Alafabco, Inc., 539 U.S. 52, 56, 123 S.Ct. 2037, 156 L.Ed.2d 46 (2003) (internal quotation marks omitted). "One seeking to enforce an arbitration agreement 'must show [(1)] that a valid agreement to arbitrate exists, [(2)] that the movant is entitled to invoke the arbitration clause, [(3)] that the other party is bound by that clause, and [(4)] that the claim asserted comes within the clause's scope.' " Álvarez-Maurás, 919 F.3d at 623-24 (quoting InterGen N.V. v. Grina, 344 F.3d 134, 142 (1st Cir. 2003)). In contesting Citizens' motion, Plaintiff argues that (1) there is no valid arbitration agreement between the parties and (2) the asserted claims fall outside the scope of the arbitration provision. Thus, the Court's decision turns on these two elements of the test.
The parties agree that the FAA applies here. See Def.'s Mem. 7 n.2; Pl.'s Mem. Opp. Mot. Dismiss ("Pl.'s Mem.") 6, ECF No. 26.
A. Validity of the PDAA
Plaintiff argues that the PDAA, including its arbitration provision, is not enforceable against him because Citizens never gave him a copy of the PDAA and no one explained the document to him. Pl.'s Mem. Opp. Mot. Dismiss ("Pl.'s Mem.") 9-11, ECF No. 26. The Court need not delve too deeply into this question, however, as this issue has already been decided. In Judge Kugler's decision granting Citizens' Motion to Transfer this case to Rhode Island, ECF No. 10, he considered Plaintiff's arguments regarding the validity of the PDAA and determined that Plaintiff's "failure to read [the] agreement [did] not free [him] from its terms," ultimately concluding that the PDAA was enforceable against Plaintiff. Op. at 7-9. As Citizens points out, this conclusion is the law of the case. See Def.'s Reply 2-5, ECF No. 27. "[L]egal decisions, or rulings of law, made by a court at a particular stage of a civil or criminal proceeding become 'law of the case,' and that thereafter these determinations govern the same issues in subsequent stages of the same litigation, unless corrected by appellate review." McConaghy v. Sequa Corp., 294 F. Supp. 2d 151, 160 (D.R.I. 2003) (citing Arizona v. California, 460 U.S. 605, 618, 103 S.Ct. 1382, 75 L.Ed.2d 318 (1983); Ellis v. United States, 313 F.3d 636, 646 (1st Cir. 2002)). This rule applies to "all legal determinations made at the same level of proceedings" and includes those rulings made by previous judges. Id. (citing Ellis, 313 F.3d at 646). Now, Plaintiff has made the same arguments against validity that he presented to Judge Kugler and which Judge Kugler rejected. Accordingly, because Judge Kugler's determination that Plaintiff is bound to the terms of the PDAA stands, the Court concludes that the arbitration provision is valid.
B. Scope of the Arbitration Provision
Thus, the question to tackle is whether Plaintiff's claims fall within the scope of the arbitration provision. The provision provides:
These include the § 1981 and NJLAD claims against both Citizens and Defendant Bhatti. Although Mr. Bhatti has not joined Defendant's Motion to Dismiss (nor otherwise appeared in this case), Citizens argues that the discrimination claims against Defendant Bhatti are also subject to the arbitration pro vision. Def.'s Mem. 13. Plaintiff does not specifically address the claims against Mr. Bhatti, and so the Court assumes that Plaintiff's arguments against arbitrability apply equally to Citizens and Defendant Bhatti. See generally Pl.'s Mem.
Because Plaintiff does not contest the arbitrability of his intentional infliction of emotional distress claim, see generally Pl.'s Mem., the Court need only address the arbitrability of the discrimination claims.
If you have a dispute with us, and we are not able to resolve the dispute informally, you and we agree that upon demand by either you or us, the dispute will be resolved through the arbitration process as set forth in this part. A "claim" or "dispute," as used in this Arbitration Agreement, is any unresolved disagreement between you and us, arising from or relating in any way to the Account Agreement (including any renewals, extensions, addendums or modifications) or the deposit relationship between us. It includes any disagreement relating in any way to services, accounts or other matters; to your use of any of our banking facilities; or to any means you may use to access you account(s) . . . . Claims are subject to arbitration, regardless of on what theory they are based, whether they seek legal or equitable remedies, or whether they are common law or statutory (federal or state claims). Arbitration applies to any and all such claims or disputes, whether they arose in the past, may currently exist, or may arise in the future.DXB 26-27 (emphasis added).
Citizens argues that all of Plaintiff's claims are connected to "his deposit relationship with Citizens and use of Citizens' banking facilities, as well as his underlying account agreement with Citizens" and, therefore, are covered by the arbitration provision. Def.'s Mem. at 10-11. Plaintiff argues that discrimination claims are not clearly covered and that, therefore, fall outside the scope of the arbitration provision.
In enacting the FAA, "Congress declared a national policy favoring arbitration and withdrew the power of the states to require a judicial forum for the resolution of claims which the contracting parties agreed to resolve by arbitration." Southland Corp. v. Keating, 465 U.S. 1, 10, 104 S.Ct. 852, 79 L.Ed.2d 1 (1984); see also Grand Wireless, Inc. v. Verizon Wireless, Inc., 748 F.3d 1, 6 (1st Cir. 2014).
Unless the parties clearly and unmistakably provide otherwise, the court must resolve a disagreement among the parties as to whether an arbitration clause applies to a particular dispute. [A] court may order arbitration of a particular dispute only where the court is satisfied that the parties agreed to arbitrate that dispute. When deciding whether the parties agreed to arbitrate a certain matter . . . courts generally . . . should apply ordinary state-law principles that govern the formation of contracts. [The Court] conduct[s its] analysis with the federal policy in favor of arbitration in mind, such that, as with any other contract, the parties' intentions control, but those intentions are generously construed as to issues of arbitrability. At a minimum, this policy requires that ambiguities as to the scope of the arbitration clause itself [must be] resolved in favor of arbitration.Id. at 7 (internal quotation marks and citations omitted). New Jersey law on this issue tracks the FAA. See Atalese v. U.S. Legal Servs. Grp., L.P., 219 N.J. 430, 99 A.3d 306, 311-12 (2014).
To determine whether a claim falls within the scope of an arbitration provision, the Court looks to New Jersey contract law. See First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944, 115 S.Ct. 1920, 131 L.Ed.2d 985 (1995). Under New Jersey law, "when a contract contains a waiver of rights—whether in an arbitration or other clause—the waiver 'must be clearly and unmistakably established.' " Atalese, 99 A.3d at 314 (quoting Garfinkel v. Morristown Obstetrics & Gynecology Assocs., P.A., 168 N.J. 124, 773 A.2d 665, 670 (2001)). The Court also looks to "the factual allegations underlying [the] claims in the [c]omplaint." Grand Wireless, 748 F.3d at 7 (quoting Dialysis Access Ctr., LLC v. RMS Lifeline, Inc., 638 F.3d 367, 378 (1st Cir. 2011)). Here, Plaintiff attacks the services he received at a specific Citizens location, this undoubtedly falls under the portion of the provision noting that "any disagreement relating in any way to services, accounts or other matters; to your use of any of our banking facilities; or to any means you may use to access you account(s)," DXB at 27. Further, the provision clearly specifically addresses the legal basis of claims and provides very broad language, which can be read only as covering all claims related to the listed areas regardless of whether they are based in statutory (state or federal) or common law. See id. at 26-27. In reading the provision at issue, especially given "[a]rbitration's favored status," Atalese, 99 A.3d at 312, it is clear that Plaintiff's discrimination claims fall within the provision's scope. Even the most skeptical reader would understand that just about any issue involving the relationship between bank and customer would be covered by this arbitration provision, regardless of the legal basis of the claim. Plaintiff, however, contends that the law provides a special carve out when it comes to arbitration coverage of discrimination claims. He argues that discrimination claims must be specifically listed by name as subject to arbitration to be covered by an arbitration clause. See, e.g., Pl.'s Mem. at 7-8.
Plaintiff first cites Wright v. Universal Maritime Service Corp., 525 U.S. 70, 119 S.Ct. 391, 142 L.Ed.2d 361 (1998), to support his position. In Wright, the Supreme Court held that, in the specific confines of that case, for a discrimination claim to be fall under the purview of an arbitration provision, its inclusion "must be clear and unmistakable." Id. at 80, 119 S.Ct. 391 (quoting Metro. Edison Co. v. NLRB, 460 U.S. 693, 708, 103 S.Ct. 1467, 75 L.Ed.2d 387 (1983)). Although the Court also provided: "[W]e will not infer from a general contractual provision that the parties intended to waive a statutorily protected right unless the undertaking is 'explicitly stated,' " id., the Court did not hold that a claim must be actually listed to be "explicitly stated," see id.
The Court pauses here to note that Wright does not necessarily have the universal applicability that Plaintiff presents it as having. In that case, the Supreme Court was clear that its holding was specific to the union context, Wright v. Universal Maritime Serv. Corp., 525 U.S. 70, 82 n.2, 119 S.Ct. 391, 142 L.Ed.2d 361 (1998) ("Our conclusion that a union waiver of employee rights to a federal judicial forum for employment-discrimination claims must be clear and unmistakable means that, absent a clear waiver, it is not 'appropriate,' within the meaning of this provision of the ADA, to find an agreement to arbitrate. We take no position, however, on the effect of this provision in cases where a CBA clearly encompasses employment-discrimination claims, or in areas outside collective bargaining."); however, the Court need not consider Citizens' argument that the Court should entirely disregard Wright as, even assuming it applies here, it does not support Plaintiff's position.
Plaintiff looks next to Garfinkel v. Morristown Obstetrics & Gynecology Associates, P.A., 168 N.J. 124, 773 A.2d 665 (2001), to support his position that an arbitration provision must specifically reference covering discrimination-related claims in order to cover a claim brought pursuant to the NJLAD. See Pl.'s Mem. at 12-13. In that case, after determining that the plaintiff's discrimination claims were not covered by the arbitration agreement, the New Jersey Supreme Court clarified:
we do not suggest that a party need refer specifically to the [NJ]LAD or list every imaginable statute by name to effectuate a knowing and voluntary waiver of rights. To pass muster, however, a waiver-of-rights provision should at least provide that the employee agrees to arbitrate all statutory claims arising out of the employment relationship or its termination. It should also reflect the employee's general understanding of the type of claims included in the waiver, e.g., workplace discrimination claims.Garfinkel, 773 A.2d at 672. While Plaintiff interprets this to mean that an arbitration clause must specifically cite "discrimination claims," the Court disagrees. Rather, the clause must be clear that it covers such claims. See Harper v. Amazon.com Servs. Inc., Civil Action No. 19-21735, 2022 WL 17751465, at *10 (D.N.J. Dec. 19, 2022) (determining that because arbitration clause clearly included claims related to employment termination, Plaintiff's termination-related NJLAD claim was covered even though clause did not list "discrimination claims"). Here, as discussed above, the provision at issue covers Plaintiff's discrimination claims.
Ultimately, neither Wright nor Garfinkel supports Plaintiff's position. Further, the Court is not aware of any case that requires an arbitration clause to specifically include the term "discrimination" in order to cover such claims.
Thus, the Court is left only with the question of whether the case should be stayed pursuant to 9 U.S.C. § 3 or dismissed. Given that any application to confirm an arbitration award would be filed in the District of New Jersey, see 9 U.S.C. § 9, the Court concludes that staying this case would not be prudent and dismissal is appropriate. See Dialysis Access Ctr., 638 F.3d at 372 ("Where one side is entitled to arbitration of a claim brought in court, in this circuit a district court can, in its discretion, choose to dismiss the lawsuit, if all claims asserted in the case are found arbitrable.") (quoting Next Step Med. Co. v. Johnson & Johnson Int'l, 619 F.3d 67, 71 (1st Cir. 2010)). IV. CONCLUSION
The Court cannot compel arbitration because Federal courts can only compel arbitration at a location within their district, see 9 U.S.C. § 4, and, here, the PDAA designates New Jersey as the location of arbitration, see DXB 27 ("The arbitration shall take place in the federal judicial district in which you reside.").
For the reasons discussed above, Defendant's Motion to Stay or Dismiss, ECF No. 25, is GRANTED and the case is DISMISSED so that Plaintiff may pursue arbitration pursuant to the PDAA. IT IS SO ORDERED.