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Lockard v. EYM King of Kansas, LLC

United States District Court, D. Kansas

September 12, 2017

JAMES LOCKARD, on behalf of himself and all others similarly situated, Plaintiff,
v.
EYM KING OF KANSAS, LLC, and EYM GROUP, INC., Defendants.

          MEMORANDUM AND ORDER

          JULIE A. ROBINSON UNITED STATES DISTRICT JUDGE

         Plaintiff James Lockard brings this action on behalf of himself and others similarly situated, alleging unlawful wage practices under the Fair Labor Standards Act (“FLSA”) against Defendants EYM King of Kansas LLC and EYM Group, Inc. (collectively “EYM”) at their Burger King restaurants. Before the Court is Defendants' Motion to Compel Arbitration and to Stay this Action (Doc. 12). The motion is fully briefed and the Court is prepared to rule. As described more fully below, the Court grants Defendants' motion.

         I. Background

         On September 24, 2016, EYM hired Plaintiff, who worked at several Burger King stores in the Kansas City area. That same day, Plaintiff signed an Arbitration Agreement that was included in the EYM King of Kansas, LLC Hourly Management Policies and Procedures (“Handbook”). The Handbook is a thirty-three page consecutively-paginated document that includes eighteen separate policies and procedures that each contains its own signature block. It makes clear that it is not an employment agreement. The first item in the Handbook is an Election and Arbitration Agreement (“Arbitration Agreement”), which states, in relevant part:

a) Mutual Promises to Resolve Claims by Binding Arbitration: I recognize that disputes may arise between the Company (or one of its affiliates) and me during or after my employment with the Company. I understand and agree that any and all such disputes that cannot first be resolved through the Company's internal dispute resolution procedures or mediation must be submitted to binding arbitration.
I acknowledge and understand that by signing this Agreement I am giving up the right to a jury trial on all of the claims covered by this Agreement in exchange for eligibility for the Plan's medical, disability, dismemberment, death and burial benefits and in anticipation of gaining the benefits of a speedy, impartial, mutually-binding procedure for resolving disputes.
This agreement to resolve claims by arbitration is mutually binding upon both me and the Company (and its affiliates), and it binds and benefits our successors, subsidiaries, assigns, beneficiaries, heirs, children, spouses, parents and legal representatives. . . . .
The types of claims covered by this Agreement include, but are not limited to, any and all:
Claims for wages or other compensation; claims for breach of any contract, covenant, or warranty (express or implied); . . . .
Claims for a violation of any other federal, state or other governmental law, statute, regulation or Ordinance . . . .
. . . .
d) Complete Agreement: The Arbitration Procedures in Section IX of the Summary Plan description (and also in section I, paragraph B of the Plan) are incorporated by reference hereto, and made part of this Agreement the same as if they were all written here. This Agreement, together with the incorporated Arbitration Procedures in Section IX of the Summary Plan Description, is the complete agreement between the company and me. It takes the place of any oral understanding about arbitration, but other written agreements, policies or procedures may also require me to arbitrate any disputes that I may have with the Company.
I am not relying on any statements, oral or written, on the subject, effect, enforceability or meaning of this Agreement, except as specifically stated, in this Agreement. If any provision of this agreement is determined to be void or otherwise unenforceable, in whole or in part, such determination shall not affect the validity of the remainder of this Agreement.
e) Not An Employment Agreement: Neither this Agreement, the Plan nor the Summary Plan Description shall ever be construed to create any contract of employment, express or implied. This agreement, the Plan or the Summary Plan description do not in any way alter the at-will status of my employment with the Company.
f) Ratification for Modification or Revocation: I agree that each and every time that I receive Plan benefits, or have Plan benefits paid to a medical provider on my behalf, I ratify and reaffirm this Agreement the same as if I had signed this Agreement again on the date the benefits were paid.
g) Requirements for Modification or Revocation: This agreement will survive the termination of my employment with the Company. This agreement can only be revoked (except as provided in the paragraph below) or modified by a writing signed by both me and the Company's authorized representative that specifically states an intent to revoke or modify this Agreement, and this requirement of a signed writing cannot itself be waived except by such a signed writing.
. . . .
I have read the Election and Arbitration Agreement and have been given the opportunity to clarify any questions regarding its contents. By signing this Election and Arbitration Agreement, I, the undersigned employee of EYM KING OF KANSAS, LLC elect to participate in the EYM KING OF KANSAS, LLC Employee Injury Benefit Plan (hereinafter “the Plan”), and agree to each of the terms contained in the Election and Arbitration Agreement and the Plan.[1]

         Plaintiff signed and dated the Arbitration Agreement on September 24, 2016, on page 6 of the Handbook.

         Plaintiff never received, nor was offered participation or eligibility in the EYM King of Kansas, LLC Employee Injury Benefit Plan, referenced in the Arbitration Agreement. Section IX of the Summary Plan description has not been provided to Plaintiff. He never received benefits from that Plan. Because Plaintiff was unfamiliar with the EYM King of Kansas, LLC Employee Injury Benefit Plan and its Summary Plan Description, Plaintiff's counsel asked Defendants' counsel to provide copies of these documents. In response to this request, Defendants' counsel provided three separate documents: (1) “Synopsis of Coverage Accidental Medical and Accidental Death & Dismemberment Benefit” statement issued to EYM King, LP;[2](2) “Group Policy Providing Accident & Health Benefits Non-Participating” issued to EYM King, LP;[3] and (3) a second “Group Policy Providing Accident & Health Benefits Non-Participating” issued to EYM King, LP.[4] None of these documents are the EYM King of Kansas, LLC Employee Injury Benefit Plan or the Summary Plan Description for the EYM King of Kansas, LLC Employee Injury Benefit Plan. None of these documents contain arbitration procedures that could be incorporated by reference into the Arbitration Agreement. When Plaintiff's counsel asked Defendants' counsel for the specifically referenced and incorporated agreements, Defendants' counsel responded: “the plans I sent you are the ones that are in existence, regardless of how it may have been referred to in the arbitration agreement.”[5]

         On page 31 of the Handbook, after the eighteen separate policies and procedures, is an Acknowledgement of Receipt of Hourly Management Policies and Procedures, which contains another signature block. It states that “By my signature below, I acknowledge that I have received, read and understand the Hourly Management Policies and Procedures, have been given the opportunity to ask questions, have received clarification, and understand for the following contents, ” the first of which is the Arbitration Agreement, which includes an itemized list of the sections included in that agreement. It then states on page 33:

I understand that EYM King of Kansas, LLC.'s policies and procedures may change from time to time at EYM King of Kansas, LLC 's sole discretion with or without notice to me, and that the revised information may supersede, modify, or eliminate existing policies. I acknowledge that all changes to the Hourly Management Policies and Procedures will be binding upon me as of the ...

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