Rodgers-Glass v. Conroe Hosp. Corp.

MADELEINE RODGERS-GLASS, Plaintiff, v. CONROE HOSPITAL CORPORATIONAND HOSPITAL CORPORATION OF AMERICA a/k/a HCA, INC., Defendants.

Civ. A. H-14-3300

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION

July 10, 2015

OPINION AND ORDER DISMISSING CASE AND COMPELLING ARBITRATION

The above referenced action, removed from state court on federal question jurisdiction under 28 U.S.C. §§ 1331 and 1441(a), alleges discrimination, retaliation, unlawful termination, violations of the Family Medical Leave Act, the Americans With Disabilities Act, the Health Insurance Portability and Accountability Act, Title VII of the Civil Rights Act of 1964 and, as amended, 1991, the Age Discrimination in Employment Act, the Employment Retirement Income Security Act, and Section 52.031 of the Texas Labor Code (offense of blacklisting, i.e., publishing the name of a former employee to prevent her from securing other employment, punishable by fine or imprisonment), defamation, slander, invasion of privacy, intentional infliction of emotional distress, etc. Pending before the Court is Defendants Conroe Regional Medical Center¹ ("the hospital") and Hospital Corporation of America a/k/a HCA, Inc.'s ("HCA's") motion to dismiss and compel arbitration under the Federal Arbitration Act ("FAA"), 9 U.S.C. § 4, because Plaintiff and everyone working at the Conroe Regional Hospital, Plaintiff Madeleine Rodgers-Glass'S former employer, are subject to a Mandatory Binding Arbitration Policy ("the Policy").²

Defendants' Motion to Dismiss and Compel Arbitration

Defendants explain with a supporting, notarized affidavit (Exhibit A) from Diana Howell, Director of Human Resources for the hospital,³ that the Policy was implemented on January 1, 2006. Under Texas law arbitration agreements are enforceable when there is notice of the policy and acceptance of its terms, regardless whether there is a signed arbitration acknowledgment form. See, e.g., In re Dillard Dep't Stores, Inc., 198 S.W. 3d 778, 781 (Tex. 2006); In re Halliburton, 80 S.W. 3d 566 (Tex. 2002), cert. denied, 537 U.S. 1112 (2003). Howell's affidavit asserts that all new employees are informed about the Policy during a New Employee Orientation process, in which Plaintiff, who began work at the hospital on June 17, 2010, participated on July 19, 2010, as evidenced by the sign-in sheet for that date, Exhibit A-2. Moreover Howell avers that it is on the hospital's intranet and available to all employees at all times. Because Plaintiff accepted work after receiving notice of the arbitration agreement during the new employee orientation policy, she accepted the mandatory binding arbitration as a matter of law as a condition of employment. Dillard, 198 S.W. 3d at 780 ("An employer may enforce an arbitration agreement entered into during an at-will employment relationship if the employee received notice of its arbitration policy and accepted it. . . . If the employee receives notice and continues working with the knowledge of the modified employment terms, the employee accepts them as a matter of law."), citing In re Halliburton Co., 80 S.W. 3d at 568.

The Policy at issue states in relevant part,

[B]oth the employee and [the Hospital] agree to give up any right either party has to a jury or judge trial regarding any issue governed by the Mandatory Binding Arbitration Policy. All disputes governed by the Mandatory Binding Arbitration Policy shall be submitted to final and binding arbitration to be conducted by an experienced Arbitrator from the American Arbitration Association (AAA) chosen by the employee and the company. The employee and the Employer will be bound by the decision made by the third party neutral arbitrator . . . .

The Policy expressly requires arbitration for the following claims, among others:

-claims relating to involuntary terminations . . .

-employment discrimination claims . . . based on . . . age . . . race, sex, religion, national origin, veteran status, citizenship, disability or other characteristics protected by federal, state or local law.

-retaliation claims as recognized by applicable state or federal law -claims relating to workplace accommodation due to any physical or mental disabilities

-claims related to state or federal family and medical leave acts . . . .

-tort claims, such as negligence, defamation, invasion of privacy, intentional infliction of emotional distress, etc.

Finally, the Policy's Mandatory Binding Arbitration Agreement states just above the signature line, "This Agreement shall be governed exclusively by and interpreted exclusively under the Federal Arbitration Act, 9 U.S.C. §§ Sections 1-16 giving effect to that Act's liberal policy toward enforcement of arbitration agreements." Exhibit A-1.⁴

Defendants maintain that all of Plaintiff's claims fall within the scope of the arbitration agreement because they are related to her discharge and the alleged discrimination/retaliation in violation of the Family Medical Leave Act and the Texas Labor Code.

Plaintiff's Response (#8)

Plaintiff objects that the copy of the arbitration agreement attached to the motion is not executed by her.

She also contends that the agreement does not state that there is a binding agreement to arbitrate between HCA and herself. Moreover if HCA is not her employer, and if consideration for the arbitration agreement is "continued employment," the arbitration provision cannot be enforced against her by HCA.

In addition Plaintiff contends that her claims other than for discrimination and wrongful termination are not within the scope of the arbitration provision.

Moreover, Plaintiff observes that the Policy (Ex. A-1) states that it was "Reviewed 1/12." Since she was hired on July 19, 2010, she asserts that the Policy is not the one in place at the time she was employed and there is no evidence that she ever received actual notice of it. That she attended an employee orientation and signed the attendance sheet is not evidence that she agreed to binding arbitration for her claims against the hospital.

Next she argues that the Policy is a modification of the employment-at-will agreement she had with the hospital and that the hospital failed to provide her with notice of the modification. Therefore it cannot be enforced against her.

Last, Plaintiff insists alternatively that Defendants, without legal justification, breached the employment-at-will agreement with her in failing to comply with their own policies and procedures regarding employment dealings and treatment of protected healthcare information, so they are estopped from asserting mandatory binding arbitration that the alleged nonemployer HCA has imposed.

Defendants' Reply (#9)

Defendants point out that the Policy (Exhibit A-1) clearly indicates that it was implemented on January 1, 2006, as does Howell's affidavit, and that it was the version in effect when Plaintiff's employment was terminated. Ex. A-1. That the hospital reviews policies every now and then does not render a prior version of the Policy inapplicable. Moreover Howell's affidavit states that all policies are available on the hospital's intranet.

It is long established that a signature is not required for an arbitration to be binding on an employee. In re RRGT, Inc., No. 04-06-00012-CV, 2006 WL 622736 (Tex. App.--San Antonio 2006)(holding that employee did not sign arbitration agreement but continued to work, and therefore accepted arbitration as a term of employment); In re Autotainment Partners, Ltd., 183 S.W. 3d 532, 535-36 (Tex. App.--Houston [14^th Dist.] 2006)(holding that "the FAA does not require that an arbitration clause be signed, so long as it is written and agreed to by the parties"), citing In re AdvancePCS Health, LP, 172 S.W. 3d 603, 606 (Tex. 2005). Defendants point out that portions of page 7 and pages 8 and 9 of the Policy are not signature blocks to indicate acceptance of the policy, but are forms for an employee to initiate a claim under the policy. See p. 7 requiring employee to describe his claims and the damages he seeks. The Policy does not require a signature. Because Plaintiff had notice of the Policy and accepted its terms by her continued employment, she is bound by its terms.

Defendants also insist that all of Plaintiffs' claims are covered by the Policy as evidenced by the long list of claims specifically covered on page 4.

Defendants further maintain that the Policy was supported by adequate consideration, i.e., Plaintiff's continued employment for four years. See, e.g., Alex Sheshunoff Mgmt. Servs., LP v. Johnson, 209 S.W. 3d 644, 665 (Tex. 2006)(holding that an agreement conditioned on continued employment becomes enforceable upon the employee's continuation in the job.). Under Plaintiff's no-consideration argument, no arbitration provision or policy would ever be enforceable if the employee was terminated at some point.

Plaintiff, herself, has claimed that she was employed by HCA, yet simultaneously argued that HCA should not receive the benefit of the arbitration provision. Her Original Petition alleged that HCA unlawfully discriminated against her and retaliated against her, violating inter alia, Title VII, a statute under which liability extends only to "employers." 42 U.S.C. § 2000e-2(a). Texas Civ. Prac. & Rem. Code § 9.011 states that the signing of pleadings constitutes a certificate by the signatory that to the signatory's best knowledge, information, and belief the pleading is not groundless and brought in bad faith. The Policy extends to HCA in stating that its purpose is to "provide Texas Affiliated Employers a consistent means for employees to resolve disputes." Ex. A-1 at p. 4. Thus both defendants should receive the benefit of the arbitration provision.

Substantive Law and Its Application Here

The FAA, 9 U.S.C. § 2, provides, "A written provision in . . . a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract . . . shall be...