LORIN CANGIANO v. THE DOHERTY GROUP, INC
Annotate this CaseNOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
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SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-3082-19
LORIN CANGIANO,
Plaintiff-Appellant,
v.
THE DOHERTY GROUP, INC.
d/b/a DOHERTY ENTERPRISES 1,
TIMOTHY DOHERTY, DANIEL
BRATCHER, CINDY GONZALEZ,
and PAUL SCHOBEL,
Defendants-Respondents.
______________________________
Submitted March 7, 2022 – Decided April 8, 2022
Before Judges Messano, Accurso, and Rose.
On appeal from the Superior Court of New Jersey,
Law Division, Monmouth County, Docket No.
L-3571-19.
McOmber McOmber & Luber, PC, attorneys for
appellant (R. Armen McOmber, of counsel and on the
briefs; Matthew A. Luber, on the briefs).
1
Incorrectly pled as Doherty Enterprises, Inc.
Saul Ewing Arnstein & Lehr, LLP, attorneys for
respondents (Dena B. Calo, Gillian A. Cooper, and
Erik P. Pramschufer, on the brief).
PER CURIAM
Plaintiff Lorin Cangiano appeals from a Law Division order compelling
arbitration and dismissing without prejudice her amended complaint against
her former employer, The Doherty Group, Inc. d/b/a Doherty Enterprises, and
four of its employees, and denying her cross-motion for counsel fees and costs.
For the reasons that follow, we affirm.
I.
On May 8, 2019, plaintiff applied for a business analyst position with
Doherty Enterprises by completing the company's online application. As part
of the requisite application process, plaintiff created a unique profile and input
information in response to a series of questions. She acknowledged the
company's policies by typing her name and date in the corresponding fields.
Plaintiff indicated her "[m]ost [r]ecent [e]ducational [l]evel" was college
graduate.2
The third section of the application contains a six-paragraph provision,
displayed in bold font and entitled: "MANDATORY ARBITRATION
2
According to her initial complaint filed in October 2019, plaintiff also
attained a master's degree in business administration.
A-3082-19
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AGREEMENT" (Agreement). After she was hired, on May 20, 2019, plaintiff
electronically acknowledged she had signed the Agreement as part of her
employment application.
Pursuant to the Agreement's first paragraph, plaintiff assented to
"binding arbitration to resolve any dispute, controversy, or claim arising out
of, relating to or in connection with [her] employment with Doherty
Enterprises." The following paragraph provides, in full:
I and Doherty Enterprises both agree that any
claim, dispute, and/or controversy (including but not
limited to any claims of employment discrimination,
harassment, and/or retaliation under Title VII of the
Civil Rights Act of 1964, the Age Discrimination in
Employment Act, the Americans with Disabilities Act,
the Family and Medical Leave Act, the Uniformed
Services Employment and Reemployment Rights Act,
and any other applicable federal, state, or local statute,
regulation or common law doctrine) which would
otherwise require or allow resort to any court between
myself and Doherty Enterprises (and/or its parents,
subsidiaries, affiliates, owners, directors, officers,
managers, employees, agents, and parties affiliated
with its employee benefit and health plans) arising
from, related to, or having any relationship or
connection whatsoever with my seeking employment
with, employment by, ending of my employment with,
or other association with Doherty Enterprises, whether
based in tort, contract, statutory, or equitable law, or
otherwise, shall be submitted to and determined
exclusively by binding arbitration.
[(Emphasis added).]
A-3082-19
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Paragraph four states the Agreement is governed by the Federal
Arbitration Act (FAA), 9 U.S.C. §§ 1-16; arbitration will be conducted
pursuant to the American Arbitration Association's (AAA) employment
arbitration rules; and the arbitrator's decision will be "final and binding upo n
both parties." The final paragraph is set forth in all capital letters,
commencing with the following provision: "I UNDERSTAND BY
AGREEING TO THIS BINDING ARBITRATION PROVISION, BOTH I
AND DOHERTY ENTERPRISES WAIVE OUR RIGHT TO TRIAL BY
JURY."
Plaintiff signed the Agreement by typing her name and date, and
submitting the application through the company's website. Plaintiff was
employed by Doherty Enterprises for three months until she was terminated on
August 21, 2019. Thereafter, plaintiff timely sued Doherty Enterprises,
Timothy Doherty, Daniel Bratcher, Cindy Gonzalez, and Paul Schobel,
asserting retaliation and wrongful termination under the Conscientious
Employee Protection Act (CEPA), N.J.S.A. 34:19-1 to -14, and wrongful
discharge in violation of public policy.
A-3082-19
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Plaintiff also sought to declare the arbitration agreement void under
N.J.S.A. 10:5-12.7 (Section 12.7), 3 a 2019 amendment to New Jersey's Law
Against Discrimination (LAD), N.J.S.A. 10:5-1 to -50, governing certain
waiver provisions set forth in employment contracts. Notably, plaintiff did not
assert a claim under any section of the LAD.
In a cogent statement of reasons accompanying a March 19, 2020 order,
the judge granted defendants' ensuing motion to compel arbitration. Analyzin g
the terms of the Agreement pursuant to the governing law, the judge found its
language clearly reflects the parties' mutual understanding that their disputes
would be submitted to arbitration, and their assent to waive their right to trial
by jury. The judge noted the capitalized text of the final paragraph emphasizes
the waiver provision. The judge further found the Agreement "identifies the
3 Effective March 18, 2019, two months prior to the effective date of the
Agreement in this case, the Legislature amended the LAD to add several
sections, including Section 12.7, which provides, in pertinent part:
a. A provision in any employment contract that
waives any substantive or procedural right or remedy
relating to a claim of discrimination, retaliation, or
harassment shall be deemed against public policy and
unenforceable.
b. No right or remedy under the "[LAD]," . . . or any
other statute or case law shall be prospectively
waived.
A-3082-19
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forum and terms of the proceeding," and "outlines the claims and issues the
parties agree will be subject to arbitration." The judge also determined
plaintiff acknowledged the terms of the Agreement during the application
process and after she was hired.
Recognizing Section 12.7 is part of the LAD – and plaintiff's complaint
failed to assert a violation of the LAD – the judge determined Section 12.7 was
inapplicable to the claims asserted in plaintiff's amended complaint. The judge
distinguished the similar purpose underscoring both acts, see Abbamont v.
Piscataway Twp. Bd. of Educ., 138 N.J. 405, 417-18 (1994), and their similar
causes of action from "the express terms within either statute." He reasoned
those terms "only apply to the claims under the [a]ct in which they fall."
Referencing paragraph (b) of Section 12.7, the motion judge noted the
Agreement "d[oes] not 'waive' any right or remedy under any statute or law."
Instead, the agreement "identifie[s] the venue in which such right or remedy
must be pursued." See Martindale v. Sandvik, Inc., 173 N.J. 76, 93-94 (2002)
("The essential point is that '[b]y agreeing to arbitrate a statutory claim, a party
does not forgo the substantive rights afforded by the statute; it only submits to
their resolution in an arbitral rather than a judicial, forum.'" (alteration in
A-3082-19
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original) (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc.,
473 U.S. 614, 628 (1985))).
The motion judge did not reach defendant's preemption argument under
the FAA. This appeal followed.
On appeal, plaintiff reprises her arguments that Section 12.7 is
applicable to all retaliation claims, including those under the CEPA, and the
Agreement "is an unenforceable and unconscionable contract of adhesion."
She further contends defendant's preemption argument is inapplicable to
challenges to the Agreement's enforceability and scope, which are subject to
"ordinary contract principles under state law." Plaintiff also argues the judge
erroneously denied her cross-motion for fees and costs.
II.
We review the trial court's decision to compel or deny arbitration de
novo. Skuse v. Pfizer, Inc., 244 N.J. 30, 46 (2020). Because the enforceability
of a contractual arbitration provision is a legal determination, we need not
defer to the trial court's interpretative analysis, "unless we find it persuasive."
Kernahan v. Home Warranty Adm'r of Fla., Inc., 236 N.J. 301, 316 (2019); see
also Goffe v. Foulke Mgmt. Corp., 238 N.J. 191, 207 (2019).
A-3082-19
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It is well settled that "arbitration is a matter of contract." NAACP of
Camden Cnty. E. v. Foulke Mgmt. Corp., 421 N.J. Super. 404, 424 (App. Div.
2011) (internal quotation marks omitted). In determining whether a matter
should be submitted to arbitration, a court must first evaluate whether a v alid
agreement to arbitrate exists and, if so, then decide whether the dispute falls
within the scope of the agreement. Martindale, 173 N.J. at 85, 92.
An agreement to arbitrate "must be the product of mutual assent, as
determined under customary principles of contract law." Atalese v. U.S. Legal
Servs. Grp., L.P., 219 N.J. 430, 442 (2014) (internal quotation marks omitted).
"As with other contractual provisions, courts look to the plain language the
parties used in the arbitration provision," Medford Twp. Sch. Dist. v.
Schneider Elec. Bldgs. Ams., Inc., 459 N.J. Super. 1, 8 (App. Div. 2019),
thereby honoring the intentions of the parties, Quigley v. KPMG Peat
Marwick, LLP, 330 N.J. Super. 252, 270 (App. Div. 2000). "[T]o be
enforceable, the terms of an arbitration agreement must be clear, and any legal
rights being waived must be identified." Antonucci v. Curvature Newco, Inc.,
___ N.J. Super. ___, ___ (App. Div. 2022) (slip op. at 8); see also Skuse, 244 N.J. at 49 ("[A] waiver-of-rights provision [must] be written clearly and
unambiguously.").
A-3082-19
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"In an employment setting, employees must 'at least know that they have
agree[d] to arbitrate all statutory claims arising out of the employment
relationship or its termination.'" Skuse, 244 N.J. at 49-50 (alteration in
original) (quoting Atalese, 219 N.J. at 447). "When the waiver of rights is an
agreement to arbitrate employment disputes, courts 'require[ ] some concrete
manifestation of the employee's intent as reflected in the text of the agreement
itself.'" Id. at 48 (alteration in original) (quoting Leodori v. Cigna Corp., 175 N.J. 293, 300 (2003))). The waiver-of-rights provision need not include a
"prescribed set of words." Atalese, 219 N.J. at 447. Instead, the provision, "at
least in some general and sufficiently broad way, must explain that the plaintiff
is giving up her right to bring her claims in court or have a jury resolve the
dispute." Ibid.
The FAA and the New Jersey Arbitration Act, N.J.S.A. 2A:23B-1 to -36,
reflect federal and state policies that favor arbitration of disputes. The FAA
preempts state laws "that single out and invalidate arbitration agreements."
Roach v. BM Motoring, LLC, 228 N.J. 163, 174 (2017). Therefore, a court
"cannot subject an arbitration agreement to more burdensome requirements
than other contractual provisions." Ibid. (internal quotation marks omitted).
And the terms of an arbitration provision should be read liberally and i n favor
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of arbitration. Garfinkel v. Morristown Obstetrics & Gynecology Assocs.,
P.A., 168 N.J. 124, 132 (2006); see also Preston v. Ferrer, 552 U.S. 346, 362-
63 (2008) (noting incorporation of the AAA rules weighs in arbitration's
favor).
With those general principles in mind, we first consider the
enforceability of the Agreement and conclude – as did the motion judge – its
terms are clear, and the waiver of plaintiff's right to trial by jury was
prominently displayed in capital letters and bolded font. The terms of the
Agreement clearly state the parties agreed to arbitrate all employment-related
claims before an AAA arbitrator, and "waive [their] right to trial by jury." The
Agreement expressly states it covers all statutory claims and the parties. The
Agreement also was the product of mutual assent. Plaintiff acknowledged she
signed the Agreement during the application process and again when she was
hired. We therefore conclude the Agreement is valid and enforceable. 4
4
Plaintiff does not argue her claims fall outside the scope of the Agreement,
which delegated to the arbitrator any question concerning the arbitrability of
all claims. Delegations of the scope of an arbitration agreement are
enforceable under the FAA. Henry Schein, Inc. v. Archer & White Sales, Inc.,
592 U.S. ___, 139 S. Ct. 524, 529-30 (2019); see also Goffe, 238 N.J. at 211.
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We also reject plaintiff's contentions that as a contract of adhesion, 5 the
Agreement is unenforceable. See Martindale, 173 N.J. at 89, 96 (holding even
if the arbitration provision at issue were deemed a contract of adhesion, its
terms were "clear and unambiguous" and "sufficiently broad to encompass
reasonably [the] plaintiff's statutory causes of action"). Similar to the
applicant in Martindale, plaintiff in the present case "has failed to demonstrate
how the terms of the arbitration agreement were oppressive or
unconscionable." Id. at 91. At the very least, plaintiff was a college graduate
when she acknowledged the terms of the Agreement during the application
process and thereafter when she was hired. She expressed no inability to
understand those terms. Moreover, "[t]he insertion of an arbitration agreement
in an application for employment simply does not violate public policy." Id. at
92.
We turn to the application of Section 12.7 to plaintiff's retaliation claims
under the CEPA. Plaintiff maintains notwithstanding the inclusion of the
section in the LAD statute, paragraph (b) plainly states: "No right or remedy
5
"[T]he essential nature of a contract of adhesion is that it is presented on a
take-it-or-leave-it basis, commonly in a standardized printed form, without
opportunity for the 'adhering' party to negotiate except perhaps on a few
particulars." Rudbart v. N. Jersey Dist. Water Supply Comm'n, 127 N.J. 344,
353 (1992).
A-3082-19
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under the '[LAD],' . . . or any other statute or case law shall be prospectively
waived." (Emphasis added). While we acknowledge plaintiff's argument, we
need not decide the issue.
Instead, we consider defendants' contention that Section 12.7 is
preempted by the FAA, which we recently addressed in Antonucci. ___ N.J.
Super. at ___ (slip op. at 7). In that case, the plaintiff filed a discrimination
complaint under the LAD against his former employer. Id. at ___ (slip op. at
1-2). Similar to the present matter, the plaintiff signed an arbitration
agreement, stating "it was 'enforceable under and subject to the [FAA].'" Id. at
___ (slip op. at 5).
We held Section 12.7 is preempted "when applied to prevent arbitration
called for in an agreement governed by the FAA." Id. at ___ (slip op. at 15).
In reaching our decision, we reiterated the FAA's primary purpose, i.e., to
"'ensur[e] that private arbitration agreements are enforced according to their
terms.'" Id. at ___ (slip op. at 11-12) (alteration in original) (quoting AT&T
Mobility LLC v. Concepcion, 563 U.S. 333, 344 (2011)). Although we
observed the FAA does not contain a preemptive provision, we were persuaded
"the FAA protects arbitration agreements involving interstate commerce" and,
as such, "a state law that conflicts with the FAA or frustrates its purpose
A-3082-19
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violates the Supremacy Clause of the United States Constitution." Id. at ___
(slip op. at 12-13).
Applying those principles to the newly enacted amendment to the LAD,
we observed:
Section 12.7 does not expressly use the term
"arbitration," nor does it expressly state that it applies
to agreements to arbitrate. Nevertheless, applied to an
arbitration agreement in the employment context, the
plain language of Section 12.7 of LAD prohibits all
pre-dispute agreements if those agreements
prospectively waive the right to file a court action for
a LAD claim.
The waiver of the right to go to court and
receive a jury trial is one of the primary objectives or
"defining features" of an arbitration agreement.
[(Id. at ___ (slip op. at 13-14) (quoting Kindred
Nursing Ctrs. Ltd. P'ship v. Clark, 581 U.S. ___, 137 S. Ct. 1421, 1426 (2017)).]
Similar to the motion judge in the present case, we were persuaded an
agreement to arbitrate a dispute "'does not forgo the substantive rights afforded
by the statute.'" Id. at ___ (slip op. at 15) (quoting Martindale, 173 N.J. at 93).
We conclude the FAA preempts N.J.S.A. 10:5-12.7 in the present matter
for the same reasons we found controlling in Antonucci, id. at ___ (slip op. at
12-15); because the parties agreed to arbitrate their disputes pursuant to the
FAA, the motion judge properly dismissed plaintiff's complaint and compelled
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arbitration. To the extent we have not specifically addressed a particular
argument, it is because either our disposition makes it unnecessary, or the
argument was without sufficient merit to warrant discussion in a written
opinion. R. 2:11-3(e)(1)(E).
Affirmed.
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