United States District Court, D. New Mexico
MEMORANDUM OPINION AND ORDER
August 24, 2017, Defendant Western Refining Retail, LLC,
filed a Motion to Compel Arbitration and Dismiss or Stay
Proceedings (ECF No. 4). The Court, having considered the
motion, briefs, argument, evidence, and applicable law,
concludes that the motion should be granted and this case
should be stayed pending arbitration.
Michael Coots is a former employee of Western Refining
Southwest, Inc., (“Western Refining”) whose job
supported retail convenience stores and gas stations owned
and co-operated by Defendant Western Refining Retail, LLC
(“Western Retail”) a subsidiary of Western
Refining. Plaintiff began working for Western Refining in
13, 2014, Plaintiff executed a Mutual Agreement to Arbitrate
Claims (“Arbitration Agreement”) with Western
Refining. In the letter describing the Arbitration Agreement,
Western Refining stated: “You do not have to sign this
document. However, if you do not sign it, you may not work
for Western Refining.” Ex. A-2, ECF No. 4-1 at 4 of 9.
Mr. Coots understood that he would be fired if he did not
sign the Arbitration Agreement. Aff. of Michael Coots ¶
3, ECF No. 6-1.
Arbitration Agreement stated it is between the
“Employee” and the “Company, ”
defined as Western Refining Southwest, Inc., and its
affiliated companies. Arbitration Agreement 1, ECF No. 4-1.
According to the terms of the agreement, the Company and the
Employee consented to
arbitration of any and all claims or controversies for which
a court otherwise would be authorized by law to grant relief
in any way arising out of, relating to or associated with the
Employee's employment with the Company, or its
termination (“Claims”), that the Company may have
against the Employee or that the Employee may have against
the Company or against its officers, directors, employees or
agents in their capacity as such or otherwise. The Claims
covered by this Agreement include, but are not limited to,
claims for wages or other compensation due; … tort
claims; claims for discrimination, including … based
on … age …; and claims for violation of any
federal, state or other governmental … statute
Id. The Arbitration Agreement states that it
“can be modified or revoked only by a writing signed by
both parties.” Id. at 2.
Refining terminated Plaintiff's employment on October 10,
2016. Plaintiff filed a Complaint for Employment
Discrimination on the Basis of Age, asserting two claims: age
discrimination under the New Mexico Human Rights Act and
retaliatory discharge for reporting safety concerns in the
workplace. Compl., ECF No. 1-1. Western Refining removed the
case to federal court based on diversity jurisdiction and
moved the Court to compel arbitration and dismiss the case or
stay proceedings. Plaintiff does not dispute that the
contract involves interstate commerce, and thus, that the
Federal Arbitration Act, 9 U.S.C. §§ 1-16,
(“FAA”) applies. Plaintiff, however, argues that
there was no consideration, so the Arbitration Agreement is
not a valid, binding contract.
makes agreements to arbitrate “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. Congress's purpose in enacting the FAA was
“to reverse the longstanding judicial hostility to
arbitration agreements that had existed at English common law
and had been adopted by American courts, and to place
arbitration agreements upon the same footing as other
contracts.” Gilmer v. Interstate/Johnson Lane
Corp., 500 U.S. 20, 24 (1991). The FAA has created a
body of federal substantive law establishing and regulating
the duty to enforce arbitration agreements. Mitsubishi
Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S.
614, 625 (1985).
agreements, however, may be invalidated by “generally
applicable contract defenses, such as fraud, duress, or
unconscionability.” Rent-A-Center, West, Inc. v.
Jackson, 561 U.S. 63, 68 (2010) (quoting
Doctor's Associates, Inc. v. Casarotto, 517 U.S.
681, 687 (1996)). In applying state law, a court may not
construe an arbitration agreement differently from how it
otherwise construes non-arbitration agreements under state
law. Avedon Engineering, Inc. v. Seatex, 126 F.3d
1279, 1287 (10th Cir. 1997) (quoting Perry v.
Thomas, 482 U.S. 483, 492 n.9 (1987)). In enacting the
FAA, Congress did not intend to force parties to arbitrate in
the absence of an agreement, and therefore the
“existence of an agreement to arbitrate is a threshold
matter which must be established before the FAA can be
invoked.” Id. at 1286-87. When the parties
dispute the existence of a valid arbitration agreement, the
presumption in favor of arbitration disappears. Dumais v.
American Golf Corp., 299 F.3d 1216, 1220 (10th Cir.
generally will enforce agreements according to their terms,
but “[a]rbitration under the Act is a matter of
consent, not coercion.” Volt Info. Sciences, Inc.
v. Board of Trustees, 489 U.S. 468, 479 (1989).
“[C]ourts should remain attuned to well-supported
claims that the agreement to arbitrate resulted from the sort
of fraud or overwhelming economic power that would provide
grounds for the revocation of any contract.”
Gilmer, 500 U.S. at 33 (internal quotations
argues there was a lack of consideration because he was
already an employee of Defendant at the time he signed the
agreement. Defendant asserts that an employer's mutual,