Mazurkiewicz v. Clayton Homes, Inc.

971 F.Supp.2d 682

Kevin T. MAZURKIEWICZ, Plaintiff,

v.CLAYTON HOMES, INC., et al., Defendants.

Civil Action No. 6:12–CV–49.

United States District Court,

S.D. Texas,

Victoria Division.

Aug. 2, 2013.

Adriaan Tieleman Jansse, The Jansse Law Firm, San Antonio, TX, Gay Ellen Gilson, Attorney at Law, Corpus Christi, TX, for Plaintiff.

Michael D. Mitchell, Ogletree Deakins et al., Houston, TX, for Defendants.

MEMORANDUM AND ORDER

GREGG COSTA, District Judge.

Defendant CMH Homes, Inc. seeks to enforce a number of contractual limitations on the ability of its former employee, Plaintiff Kevin Mazurkiewicz, to assert claims related to his employment. While arbitration clauses are the most commonly litigated provisions in employment agreements limiting the right to sue, this case involves two others: (1) a provision shortening the statute of limitations to six months, and (2) a so-called “class action waiver” that bars the employee from bringing suit in a representative capacity. For the reasons discussed below, the Court concludes that the contractual limitations period is not enforceable against the individual Americans with Disabilities Act and Fair Labor Standards Act claims in this case, but the agreement preventing Mazurkiewicz from bringing a collective action is. The Court also rejects CMH's other arguments seeking dismissal of the individual claims. Mazurkiewicz may pursue his individual claims, but his allegations of a collective FLSA action are dismissed.

I. Background

Mazurkiewicz began working for CMH as a manufactured homes seller in September 2010. Prior to beginning his employment, he completed and signed an employment application on August 18, 2010, and an employment agreement on August 27, 2010. The employment application provided that “by signing and submitting this employment application” Mazurkiewicz agreed that he was “waiving [his] right to participate as a member in a class-action lawsuit or proceeding and/or act as a representative of a class of similarly situated individuals in any lawsuit or proceeding against” CMH. Docket Entry No. 11–1 at 6. The employment agreement provided that, in exchange for a voluntary mediation process, Mazurkiewicz agreed “[t]o file any lawsuit no more than six months after the date of the employment action that is the subject of the lawsuit” and “[t]o not be a member of a class-action lawsuit against” CMH. Id. at 9.

At the end of July 2011, Mazurkiewicz was terminated. He promptly filed a charge of discrimination with the EEOC on August 18, 2011, alleging that he was discharged in violation of the ADA. The charge identified Mazurkiewicz's employer as Clayton Homes, Inc., CMH's parent company. In its statement of position in response to this charge, CMH clarified that it was his true employer. The EEOC issued Mazurkiewicz a right to sue letter about one year later, on August 21, 2012.

Mazurkiewicz then filed this lawsuit on November 16, 2012, asserting claims for violations of the ADA and FLSA, and pleading his FLSA claim as a putative collective action. The original complaint named only Clayton Homes as a defendant. On January 10, 2013, he amended his complaint to add CMH as a defendant, and amended again on May 20, 2013 to remove Clayton Homes.

II. Standard of Review

CMH's motion seeks dismissal under Rule 12(b)(6) or, in the alternative, summary judgment under Rule 56. Because the parties' briefing relies on documents outside the pleadings, such as the employment agreements and the records from the EEOC proceeding, the Court will review the motion under the summary judgment standard. SeeFed.R.Civ.P. 56(a) (stating that a court shall grant summary judgment “if the movant shows that there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law”). Although summary judgment typically occurs at a later stage in the case, the Court denies Mazurkiewicz's request for discovery on the issues presented because they are legal questions on which further factual development would not assist.

III. DiscussionA. Whether the Claims Are Contractually Barred

1. Scope of the Agreements

Before addressing the enforceability of the contractual limitations period and “class action” waiver, the Court must determine whether these provisions facially apply to the claims in this case. The contractual limitations period and one of the class waivers appear as part of the following “Mediation Agreement” in the “Employment Form”:

Mediation Agreement: I understand that if I should have a complaint against the Company that is not resolved, the Company will, at my request, institute a mediation process. In exchange for this mediation benefit, in the event the Company cannot resolve my dispute and I think a lawsuit arising out of my employment is necessary, I agree with the Company as follows:

1. Jury Trial Waiver: [omitted]

2. Statute of Limitations: To file my lawsuit no more than six months after the date of the employment action that is the subject of the lawsuit. My signature below indicates that I agree to waive all rights contained in any law that would allow me more than six (6) months to file suit.

3. Class Action Waiver: To not be a member of a class-action lawsuit against the company. My signature below indicates that I agree to waive any right I may have to be a member of a class action lawsuit against the Company.

Document Entry No. 11–1 at 9. Mazurkiewicz argues that because he did not elect to use the mediation program, the contractual “Statute of Limitations” and “Class Action Waiver” do not apply. While creative, this argument contradicts the plain language of the agreement, which provides that the employee makes the agreements in exchange for a “mediation benefit.” Id. Nothing indicates that election of the mediation benefit is a condition to application of the employee's agreements to waive a jury, be subject to a six-month limitations period, and “not be a member of a class-action lawsuit.” Id.

The Court has more concern about the applicability of the “Class Action Waiver” to Mazurkiewicz's FLSA claim that he seeks to bring “as a collective action under 216(b) of the FLSA on behalf of himself and others similarly situated.” Docket Entry No. 21 at 1. Mazurkiewicz's status in this case is not as a “member of a class-action lawsuit.” Docket Entry No. 11–1 at 9. An FLSA collective action is not termed a “class action” and has fundamental differences with a Rule 23 action that binds absent class members. See Genesis Healthcare Corp. v. Symczyk, ––– U.S. ––––, 133 S.Ct. 1523, 1529, 185 L.Ed.2d 636 (2013) (“Rule 23 actions are fundamentally different from collective actions under the FLSA ....” (citation omitted)).

But the Court need not decide if the “Class Action Waiver” in this “Mediation Agreement” paragraph applies to an FLSA collective action, because the following broader language in the employment application applies to FLSA cases brought collectively: “I am waiving my right to ... act as a representative of a class of similarly situated individuals in any lawsuit or proceeding against the Company.” Docket Entry No. 11–1 at 6; compare id., with Docket Entry No. 21 at 1 (purporting to bring this action “on behalf of himself and others similarly situated”).

The Court also rejects Mazurkiewicz's argument that the contractual provisions are not conspicuous, as they are contained in a two-page employment application that Mazurkiewicz completed and signed and a two-page employment agreement that he signed once and initialed twice. See Docket Entry No. 11–1 at 5–6, 8–9; see also Am. Eagle Ins. Co. v. United Techs. Corp., 48 F.3d 142, 146 (5th Cir.1995) (“In Texas, the courts examine the entire document when making their determination of whether a disclaimer is conspicuous.” (citations omitted)). For these reasons, the Court finds that the claims in this case fall within the scope of the contracts Mazurkiewicz signed. The next question is whether those provisions are legally enforceable.

2. Enforceability of the Contractual Limitations Period

It has long been recognized that “a provision in a contract may validly limit, between the parties, the time for bringing an action on such contract to a period less than that prescribed in the general statute of limitations, provided that the shorter period itself shall be a reasonable period.” Order of United Commercial Travelers of Am. v. Wolfe, 331 U.S. 586, 608, 67 S.Ct. 1355, 91 L.Ed. 1687 (1947); see also Vincent v. Comerica Bank, No. H–05–2302, 2006 WL 1295494, at *4 (S.D.Tex. May 10, 2006) (enforcing a contractually shortened limitations period). But when these provisions effectively limit a plaintiff's substantive right to recovery or act as a complete bar to relief, they are not reasonable. See 14 Penn Plaza LLC v. Pyett, 556 U.S. 247, 273, 129 S.Ct. 1456, 173 L.Ed.2d 398 (2009) (“[A] substantive waiver of federally protected civil rights will not be upheld ....” (citations omitted)); see also Salisbury v. Art Van Furniture, 938 F.Supp. 435, 437–38 (W.D.Mich.1996) (“[T]he contractual limitation certainly effected a ‘practical abrogation’ of the right to file an ADA claim and is, therefore, unreasonable....”). The Court now addresses whether the six-month limitations period effectively prevents Mazurkiewicz from bringing an ADA or FLSA suit or limits his potential recovery under those federal statutes.

a. ADA Claim

With respect to the ADA claim, the contractual limitations period effectively bars Mazurkiewicz from bringing suit. Under the ADA administrative scheme, which mirrors that for Title VII, “an aggrieved party has 180 days (or roughly six months) after the alleged unlawful employment practice to file a charge, and the EEOC is given at least 180 days ¹ after the filing of the charge (roughly another six months) to make its investigation and determination.” Mabry v. W. & S. Life Ins. Co., No. 1:03 CV 848, 2005 WL 1167002, at *3 (M.D.N.C. Apr. 19, 2005) (citing 42 U.S.C. §...