Wave Length Hair Salons of Fla., Inc. v. CBL & Assocs. Props., Inc.

WAVE LENGTH HAIR SALONS OF FLORIDA, INC.,on behalf of itself and all others similarly situated, Plaintiff, v. CBL & ASSOCIATES PROPERTIES, INC.,CBL & ASSOCIATES MANAGEMENT, INC.,CBL & ASSOCIATES LIMITED PARTNERSHIP andJG GULF COAST TOWN CENTER, LLC, Defendants.

Case No: 2:16-cv-206-FtM-38MRM

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA FORT MYERS DIVISION

August 10, 2018

ORDER

Pending before the Court is Defendants' Motion to Strike Plaintiff's Jury Demand, filed on May 11, 2017. (Doc. 104). Defendants seek to strike the jury demand asserted in Plaintiff's First Amended Complaint. (Id. at 2). Plaintiff filed its Response on November 8, 2017. (Doc. 107). Defendants filed a Reply on November 17, 2017. (Doc. 112). This matter is ripe for review. For the reasons explained below, Defendant's Motion is due to be granted.

I. Background

Plaintiff's First Amended Complaint asserts six counts, stemming from an alleged inflation of tenants' energy bills in malls nationwide owned, operated, and managed by Defendants. (See Doc. 32). One such tenant is Plaintiff. (See id.). Plaintiff Wave Lengths Hair Salons of Florida ("Wave Lengths") entered into a ten-year lease agreement with Defendant JG Gulf Coast Town Center LLC ("JG Gulf Coast") on June 13, 2006 at the Gulf Coast Town Center in Fort Myers, Florida. (Doc. 32 at ¶ 8; Doc. 32-1 at 5).

The lease agreement is divided into twelve Articles. (Doc. 32-1 at 1-2). The lease expressly names Wave Lengths as the "Tenant" and Defendant JC Gulf Coast as the "Landlord." (Id. at 5). In pertinent part for the Motion sub judice, the lease agreement contains a jury trial waiver provision in Article XI Default by Tenant, Section 11.2 Landlord's Rights on Default. (Id. at 23). The jury trial waiver is located in the second paragraph of the section and states that "[w]ith respect to any litigation arising out of this Lease, Tenant hereby expressly waives the right to a trial by jury and the right to file any countersuit or crossclaim against Landlord." (Id.).

Defendants argue that the lease's jury trial waiver applies to this case. (Doc. 104 at 2). In support, Defendants point out that the lease is integral to the First Amended Complaint because the First Amended Complaint expressly references the lease throughout. (Id. at 2-3 (citing Doc. 32)). In fact, Defendants note that the First Amended Complaint realleges paragraphs regarding the lease in each Count. (Id. (citing Doc. 32)). Defendants also note that "Plaintiff expressly defines each of the three alternative putative classes based on the lease agreements." (Id. at 3 (citing Doc. 32 at ¶ 41)).

Defendants argue that Plaintiff knowingly and voluntarily waived its right to a jury trial. (Id. at 4-8). In addition, Defendants contend that the waiver applies to all claims against all Defendants. (Id. at 8-11). Further, Defendants argue that Plaintiff is estopped from challenging the terms of the lease. (Id. at 11). Defendants contend that Plaintiff is ignoring the waiver by demanding a jury trial. (Id. (citing Doc. 32 at 36)).

In response, Plaintiff does not expressly contest that the jury trial waiver was made knowingly and voluntarily. (See Doc. 107 at 1-2). Instead, Plaintiff argues that the waiver is inapplicable for two reasons. (Id.). First, Plaintiff argues that the waiver applies only to litigation involving a tenant's default. (Id. at 4-6). Second, Plaintiff contends that the waiverapplies only to suits between the named Tenant and Landlord on the lease agreement—specifically, Plaintiff and Defendant JG Gulf Coast. (Id. at 6-7). Of note, however, Plaintiff concedes that it is not entitled to a jury trial in its claim for unjust enrichment (Count II) because it "is an equitable claim that would be heard by the Court and not a jury." (Id. at 4 n.2 (citing Skytruck Co., LLC v. Sikorsky Aircraft Corp., No. 2:09-cv-267-FtM-99SPC, 2011 WL 13141024, at *2 (M.D. Fla. May 13, 2011)).

II. Discussion

The Seventh Amendment to the United States Constitution provides that "[i]n suits at common law, where the value in controversy shall exceed twenty dollars, the right of jury shall be preserved." U. S. Const. amend. VII. "[B]ecause the right to a jury trial is fundamental, courts must indulge every reasonable presumption against waiver." Burns v. Lawther, 53 F.3d 1237, 1240 (11th Cir. 1995) (citations omitted). Even so, "[a] party may validly waive its Seventh Amendment right to a jury trial so long as the waiver is knowing and voluntary." Bakrac, Inc. v. Villager Franchise Sys., Inc., 164 F. App'x 820, 823 (11th Cir. 2006) (citing Brookhart v. Janis, 384 U.S. 1, 4-5 (1966)).

Here, the parties present two issues for the Court's review. First, although Plaintiff did not expressly contest whether its jury trial waiver was knowing and voluntary, the Court nevertheless addresses this threshold issue. Second, finding that the jury waiver was knowing and voluntary, the Court addresses the scope of the waiver and whether it applies (1) only to litigation involving a tenant's default and/or (2) only to suits solely between the named Tenant and Landlord on the lease agreement.

A. Whether the Waiver Was Knowing and Voluntary

Courts consider a number of factors in determining whether a jury trial waiver was made knowingly and voluntarily. See Allyn v. W. United Life Assur. Co., 347 F. Supp. 2d 1246, 1252(M.D. Fla. 2004). These factors include: (1) the conspicuousness of the provision in the contract; (2) the level of sophistication and experience of the parties entering into the contract; (3) the opportunity to negotiate terms of the contract; (4) the relative bargaining power of each party; and (5) whether the waiving party was represented by counsel. Id. No single factor is conclusive. Madura v. BAC Home Loans Servicing L.P., 851 F. Supp. 2d 1291, 1294 (M.D. Fla. 2012). Moreover, the Court is not bound by the number of factors that have been satisfied. Id. (citation omitted). Instead, the Court asks whether, under the circumstances, the waiver is "unconscionable, contrary to public policy, or simply unfair." Allyn, 347 F. Supp. 2d at 1252.

1. Conspicuousness of the Provision

The first factor is the conspicuousness of the waiver provision. Id.

The paragraph of the lease agreement containing the jury waiver reads as follows:

In the event of a breach by Tenant of any of the covenants or provisions hereof, Landlord shall have, in addition to any other remedies which it may have, the right to invoke any remedy allowed at law or in equity to enforce Landlord's rights or any of them, as if re-entry and other remedies were not herein provided for. With respect to any litigation arising out of this Lease, Tenant hereby expressly waives the right to a trial by jury and the right to file any countersuit or crossclaim against Landlord. Tenant agrees that no demand for rent and no re-entry for condition broken and no notice to quit possession or other notices prescribed by statute shall be necessary to enable Landlord to recover such possession or other notices prescribed by statute shall be necessary to enable Landlord to recover such possession, but that all right to any such demand and any such re-entry and any notice to quit possession or other statutory notices or prerequisites are hereby expressly waived by Tenant.

(Doc. 32-1 at 23).

Defendants argue that the jury waiver is conspicuously set forth because it is contained in a paragraph of eight lines and is written in straightforward, understandable language. (Doc. 104 at 5). Additionally, Defendants point out that the waiver "is written in the same typeface and font size as the other provisions in the lease." (Id.). Thus, Defendants maintain that "the jurytrial waiver provision is sufficiently conspicuous." (Id. (citing Madura, 851 F. Supp. 2d at 1294)).

In response, although Plaintiff did not couch its arguments in a factor-based analysis, Plaintiff notes that the lease is divided into twelve Articles, each containing various sections. (Doc. 107 (citing Doc. 32-1 at 3, 4)). Plaintiff points out that "[n]o Article heading mentions a jury trial waiver." (Id.). Further, Plaintiff notes that the jury trial waiver provision is located in Article XI, Section 11.2. (Id.). Plaintiff points out that this section contains three paragraphs and is forty lines in length. (Id.). Plaintiff states that the sentence containing the jury trial waiver is in the second paragraph, line thirty. (Id.).

In evaluating this factor, the Court finds previous decisions from other jurists in this District illustrative. For instance, in Collins v Countrywide Home Loans, Inc., United States District Judge James S. Moody found a jury trial waiver to be "conspicuous" when the provision was "present in a separate paragraph, printed in a font that is the same size as the rest of the document, located in the last paragraph of a relatively short document, and worded in clear and unambiguous language." 680 F. Supp. 2d 1287, 1295 (M.D. Fla. 2010) (citations omitted).

In another case, Madura v. BAC Home Loans Servicing L.P., United States District Judge Virginia M. Hernandez Covington found a waiver to be conspicuous when it was contained in its own separate paragraph on the eleventh page of a twelve-page mortgage directly preceding the signatures, was in a typeface and style consistent with the rest of the document, was not obscured by other language, and was not hidden in a footnote. 851 F. Supp. 2d at 1294-95.

Here, based on the cases cited above, the Court is hard-pressed to conclude that the jury waiver provision is conspicuously situated within the lease agreement. Indeed, although the provision is printed in a font that is the same size as the rest of the document and is worded inclear and unambiguous language, the provision is not in a separate paragraph, nor is it set off from the rest of the text. (See Doc. 32-1 at 23). Rather, the provision is buried in the middle of the second paragraph of a three-paragraph section. (See id)....