United States District Court, D. Maine
ORDER ON DEFENDANT'S MOTION TO COMPEL
Torresen, United States Chief District Judge
the Court is the Defendant's motion to compel
arbitration. (ECF No. 20). For the reasons stated below, the
motion is DENIED.
Plaintiffs in this matter are Robert Curtis and Robert
Lowell. Both worked as delivery drivers for an entity called
Scholarship Storage, Inc., d/b/a Business as Usual
(“BAU”). Defendant Contractor Management
Services, LLC (“CMS”) is an Arizona company that
markets itself as the “leading full-service firm for
companies utilizing Independent Contractors.” Compl.
¶¶ 9, 14 (ECF No. 1). The Complaint alleges that:
BAU was a CMS client . . . . CMS developed the contracts that
BAU used to describe Plaintiffs and other drivers as
independent contractors. CMS processed all of BAU's
payroll checks, taking out deductions for equipment drivers
were required to lease or purchase, prescription
“insurance” premiums . . ., and fees . . . as
payment to CMS for processing each payroll check.
Compl. ¶ 15.
Plaintiffs have settled a separate class action and
collective action asserting violations of the Fair Labor
Standards Act and Maine wage and hour laws against BAU.
Curtis v. Business As Usual, No. 2:14-cv-303-NT,
2016 WL 3072247 (D. Me. May 31, 2016). In this action, the
Plaintiffs allege that CMS aided and abetted BAU, was a joint
employer with BAU, or engaged in a joint enterprise with BAU,
and that CMS is liable for:
• overtime violations of the Fair Labor Standards Act,
29 U.S.C. § 216(b) (Count I);
• unpaid wages under the Maine Employment Practices Act,
26 M.R.S.A. § 629 (Count II);
• overtime violations under the Maine Minimum Wage and
Overtime Law, 26 M.R.S.A. § 661 et seq. (Count
• violation of the Maine Employment Practices Act, 26
M.R.S.A. § 629 (Count IV);
• unjust enrichment/restitution (Count V); and
• conversion for making deductions for insurance, leased
equipment and check processing (Count VI).
Defendant has moved to compel arbitration pursuant to a
“System Resource Subscription” agreement
(“SRS Agreement”) entered into between CMS and
each of the Plaintiffs. The SRS Agreements for the named
Plaintiffs were submitted with the Defendant's motion to
compel arbitration. SRS Agreement (ECF Nos. 20-3 and 20-4).
The Defendant asserts that each of the named Plaintiffs
accessed CMS's online platform, opened the SRS Agreement,
clicked through each page of it and electronically signed the
agreement. Aff of Greg Stultz ¶¶ 5-8. (ECF No.
SRS Agreement contains an identical arbitration provision
If a dispute arises out of or relates to my relationship with
CMS, this Subscription, or a breach hereof, and if the
dispute cannot be settled through negotiation, I agree to
resolve the dispute through binding arbitration only as
described in this section (hereafter “the Arbitration
SRS Agreement 4. The Arbitration Provision also includes a
provision entitled “CLASS ACTION WAIVER” that
Both CMS and end user agree to bring any dispute in
arbitration on an individual basis only, and not on a class,
collective, or private attorney general representative basis.
There will be no right or authority for any dispute to be
brought, heard or arbitrated as a class, collective,
representative or private attorney general action, or as a
member in any purported class, collective, representative or
private attorney general action, including without limitation
pending but not certified class actions (“Class Action
Waiver”). Disputes regarding the validity and
enforceability of the Class Action Waiver may be resolved
only by a civil court of competent jurisdiction and not by an
arbitrator. In any case in which (1) the dispute is filed as
a class, collective, representative or private attorney
general action and (2) a civil court of competent
jurisdiction finds all or part of the Class Action Waiver
unenforceable, the class, collective, representative and/or
private attorney general action to that extent must be
litigated in a civil court of competent jurisdiction, but the
portion of the Class Action waiver that is enforceable shall
be enforced in arbitration.
SRS Agreement 5, section C. In addition to these and other
sections, the Arbitration Provision contains a
“THIRTY-DAY OPT-OUT PERIOD” provision that
If I do not want to be subject to this Arbitration Provision,
I may opt out of this Arbitration Provision by notifying CMS
in writing of my desire to opt out of this Arbitration
Provision, which writing must be dated, signed and submitted
by U.S. Mail or hand delivery to Contractor Management
Services, LLC, Attn. Risk Management, 9197 W Thunderbird Rd.
Peoria, AZ 85381. In order to be effective, the writing must
clearly indicate my intent to opt out of this Arbitration
Provision and the envelope containing the signed writing must
be post-marked within 30 days of the date I sign this
Subscription. My writing opting out of this Arbitration
Provision will be filed with a copy of this Subscription and
maintained by CMS. Should I not opt out of this Arbitration
Provision within the 30-day period, CMS and I will be bound
by the terms of this Arbitration Provision.
SRS Agreement 6, section G. The SRS Agreement further
provides that “[i]n the event that any portion of this
Arbitration Provision is deemed unenforceable, the remainder
of this Arbitration Provision will ...