Santoro v. Accenture Fed. Servs., LLC

748 F.3d 217

Armand SANTORO, Plaintiff–Appellant,

v.ACCENTURE FEDERAL SERVICES, LLC; Accenture LLP, Defendants–Appellees.

No. 12–2561.

United States Court of Appeals, Fourth Circuit.

Argued Jan. 30, 2014.

Decided May 5, 2014.

ARGUED:Stephen Z. Chertkof, Heller, Huron, Chertkof, Lerner, Simon & Salzman, PLLC, Washington, D.C., for Appellant. Jonathan F. Cohn, Sidley Austin LLP, Washington, D.C., for Appellees. ON BRIEF:Eric D. McArthur, Paul J. Ray, Sidley Austin LLP, Washington, D.C., for Appellees.

Before GREGORY, SHEDD, and KEENAN, Circuit Judges.

Affirmed by published opinion. Judge SHEDD wrote the opinion, in which Judge GREGORY and Judge KEENAN joined.

SHEDD, Circuit Judge:

Dr. Armand Santoro appeals the district court's order granting the motion by Accenture Federal Services, LLC (Accenture) to compel arbitration. Because we agree with the district court that the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd–Frank) does not invalidate the arbitration agreement between Accenture and Santoro, we affirm.

I.

Santoro began his employment with Accenture in 1997 as a senior manager. From 1998 until 2007, Santoro served as the program manager for the Internal Revenue Service's website, IRS.gov. From 2007 until September 2011, Santoro served as the account lead for Accenture's Department of the Treasury account. In August 2005, Santoro entered into an employment contract with Accenture. The contract indicated that it would renew on September 1 of each subsequent year unless either party provided timely notice that the contract would not be extended. The contract, among other provisions, included an arbitration clause:

Any and all disputes arising out of, relating to or in connection with this Agreement or your employment by Accenture, including, but not limited to, disputes relating to the validity, negotiation, execution, interpretation, performance or non-performance of the Agreement ... shall be finally settled by arbitration.... Arbitrable disputes include without limitation employment and employment termination claims and claims by you for employment discrimination, harassment, retaliation, wrongful termination, or violations under Title VII ... the Age Discrimination in Employment Act.

(J.A.20).

In 2010, Santoro was given a new supervisor, who, according to Santoro's complaint, “instantly disliked” him. (J.A.11). In September 2011, Santoro was terminated from his employment as an account executive as part of a cost-cutting measure. Santoro, who was 66 years old at the time, was replaced by a younger male employee.

In response to his termination, Santoro filed a complaint against Accenture in the Superior Court for the District of Columbia,alleging claims for age discrimination under the District of Columbia Human Rights Act. Accenture moved to compel arbitration; Santoro opposed Accenture's motion, contending that the clause was void under three whistleblower provisions of Dodd–Frank: 7 U.S.C. § 26(n)(2), 18 U.S.C. § 1514A(e)(2), and 12 U.S.C. § 5567(d)(2).¹ The Superior Court rejected Santoro's argument and granted the motion. The court also stayed the case pending arbitration.

While that motion to compel arbitration was pending with the Superior Court, Santoro received a right-to-sue letter from the Equal Employment Opportunity Commission and filed an action in the Eastern District of Virginia, alleging claims under the Age Discrimination in Employment Act (ADEA), the Family and Medical Leave Act (FMLA), and the Employee Retirement Income Security Act (ERISA). Accenture moved in the district court to compel arbitration of these federal claims as well. Following a hearing, the district court granted the motion. Ruling from the bench, the district court concluded that Dodd–Frank “only applies to certain situations when whistleblowers are involved.” (J.A. 92). That is, Dodd–Frank's provisions “appl[y] only in the situations that [are] set out by the statute,” and the statute only “applies to whistleblowers.” (J.A. 90). Thus, because Santoro did not bring a Dodd–Frank whistleblower claim, he could not use Dodd–Frank to invalidate an otherwise valid arbitration agreement. Santoro noted a timely appeal.

II.

On appeal, Santoro contends that the district court erred in compelling arbitration. We review de novo the district court's judgment compelling arbitration, as well as any questions of state contract law concerning the validity of the arbitration agreement. Muriithi v. Shuttle Express, Inc., 712 F.3d 173, 178 (4th Cir.2013). In Santoro's view, Dodd–Frank invalidates in toto all arbitration agreements by publicly-traded companies ² that lack a carve-out for Dodd–Frank whistleblower claims, even if the plaintiff is not a whistleblower. Accenture contends that Dodd–Frank's scope is limited to plaintiffs bringing whistleblower claims.³ For the following reasons, we agree with Accenture's interpretation of the statute.

A.

This case involves the intersection of two statutes, the Federal Arbitration Act (FAA) and Dodd–Frank. “When interpreting statutes we start with the plain language.” U.S. Dep't of Labor v. N.C. Growers Ass'n, 377 F.3d 345, 350 (4th Cir.2004). “It is well established that when the statute's language is plain, the sole function of the courts-at least where the disposition required by the text is not absurd-is to enforce it according to its terms.” Lamie v. U.S. Tr., 540 U.S. 526, 534, 124 S.Ct. 1023, 157 L.Ed.2d 1024 (2004) (internal quotation marks omitted). “[I]n looking to the plain meaning, we must consider the context in which the statutory words are used because ‘[w]e do not ... construe statutory phrases in isolation; we read statutes as a whole.’ ” Ayes v. U.S. Dep't of Veterans Affairs, 473 F.3d 104, 108 (4th Cir.2006) (quoting United States v. Morton, 467 U.S. 822, 828, 104 S.Ct. 2769, 81 L.Ed.2d 680 (1984)). See also Smith v. United States, 508 U.S. 223, 233, 113 S.Ct. 2050, 124 L.Ed.2d 138 (1993) ( “Just as a single word cannot be read in isolation, nor can a single provision of a statute.”). In sum, “[w]hen determining whether or not statutory language is plain, we consider the language itself, the specific context in which that language is used, and the broader context of the statute as a whole.” Lincoln v. Dir., Office of Workers' Comp. Programs, 744 F.3d 911, 914 (4th Cir.2014) (internal quotation marks omitted).

B.

Congress enacted the FAA in 1925 “in response to widespread judicial hostility to arbitration agreements.” AT & T Mobility LLC v. Concepcion, ––– U.S. ––––, 131 S.Ct. 1740, 1745, 179 L.Ed.2d 742 (2011). Section 2 of the FAA provides that arbitration agreements “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. The FAA “embodies the national policy favoring arbitration and places arbitration agreements on equal footing with all other contracts.” Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 443, 126 S.Ct. 1204, 163 L.Ed.2d 1038 (2006). It thus represents a broad “federal policy favoring arbitration agreements,” Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983), and courts must “rigorously enforce arbitration agreements according to their terms,” Am. Express Co. v. Italian Colors Rest., ––– U.S. ––––, 133 S.Ct. 2304, 2309, 186 L.Ed.2d 417 (2013) (internal quotation marks omitted).

Federal “statutory claims may be the subject of an arbitration agreement, enforceable pursuant to the FAA.” Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 26, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991). An exception exists, however, if the “FAA's mandate has been overridden by a contrary congressional command.” Italian Colors Rest., 133 S.Ct. at 2309 (internal quotation marks omitted). Even then, “[t]he burden is on the party opposing arbitration ... to show that Congress intended to preclude a waiver of judicial remedies for the statutory rights at issue.” Shearson/Am. Express, Inc. v. McMahon, 482 U.S. 220, 227, 107 S.Ct. 2332, 96 L.Ed.2d 185 (1987).

Here, it is undisputed that (1) Santoro's employment contract had an arbitration agreement; and (2) Santoro's federal claims fall within the broad “all disputes” language of that agreement. Santoro, however, seeks to avoid arbitration by pointing to recent limitations on arbitration made by Dodd–Frank. In Santoro's view, Dodd–Frank represents a “contrary congressional command” that overrides the otherwise valid arbitration clause in his employment contract.

C.

As relevant here, one of the goals of Dodd–Frank was to strengthen whistleblower protections for employees reporting illegal or fraudulent activity by their employer. To this end, Congress enacted 7 U.S.C. § 26, which amended the Commodities Exchange Act by adding a provision prohibiting retaliation by a covered employer against a “whistleblower.” 7 U.S.C. § 26(h)(1)(A). The statute creates a cause of action for whistleblowers, § 26(h)(1)(B)(i), and then protects the cause of action through § 26(n), which provides:

(n) Nonenforceability of certain provisions waiving rights and remedies or requiring arbitration of disputes

(1) Waiver of rights and remedies

The rights and remedies provided for in this section may not be waived by any agreement, policy form, or condition of employment including by a predispute arbitration agreement.

(2) Predispute arbitration agreements

No predispute arbitration agreement shall be valid or enforceable, if the agreement requires arbitration of a dispute arising under this section.

7 U.S.C. § 26(n).

In addition to this amendment to the Commodities Exchange Act, Dodd–Frank amended 18 U.S.C. § 1514A, which was first enacted as part of the Sarbanes–Oxley Act of 2002. This provision is titled “Civil Action to protect against retaliation in fraud cases,” and the first subsection is expressly labeled “Whistleblower protection for employees of publicly traded...