Katherine Anderson v. Jeffrey Hansen ( 2022 )

United States Court of Appeals
For the Eighth Circuit
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No. 21-2719
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Katherine Anderson; Jason Anderson
lllllllllllllllllllllPlaintiffs - Appellees
v.
Jeffrey Hansen
lllllllllllllllllllllDefendant - Appellant
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Appeal from United States District Court
for the Eastern District of Missouri - St. Louis
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Submitted: April 12, 2022
Filed: August 30, 2022
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Before SMITH, Chief Judge, WOLLMAN and GRASZ, Circuit Judges.
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SMITH, Chief Judge.
Katherine and Jason Anderson, independent contractors of American Family
Life Insurance Company of Columbus (Aflac), alleged that Jeffrey Hansen, an Aflac
employee, sexually assaulted Katherine in her hotel room during a work conference
in St. Louis, Missouri. The Andersons filed suit against Hansen, asserting tort claims
for battery, assault, false imprisonment, and loss of consortium, among others.
Hansen moved to compel arbitration of the claims, claiming that he is a third-party
beneficiary under the Andersons’ Arbitration Agreements with Aflac. The district
court1 denied the motion as to the aforementioned claims, holding that they did not
arise under or relate in any way to the arbitration agreements. Hansen appeals,
arguing that the claims fall within the scope of the arbitration agreements. We affirm.
I. Background2
Katherine and Jason Anderson were independent contractors for Aflac in
Colorado. Katherine attended an Aflac work conference on August 29–30, 2018, in
St. Louis, Missouri. Hansen, a W-2 Business Development Manager for Aflac in
Minnesota, also attended the conference. According to the Andersons, Katherine
attended the first portion of the conference on August 29. After the attendees were
dismissed for the evening, Katherine joined other attendees for dinner, followed by
drinks at a bar where Hansen purchased Katherine a drink. After an evening of
drinking, Katherine returned to her hotel room. After midnight on August 30, Hansen
forcibly entered Katherine’s hotel room and raped her.
Based on the incident, the Andersons’ counsel sent Aflac a demand letter
setting forth “claims against A[flac] for negligent hiring, retention, and supervision,
and for Title VII violations.” Appellant’s Add. at 27. While “the exact allegations
against Aflac are not part of the record in this case,” Aflac ultimately settled with the
Andersons. Anderson v. Hansen, 550 F. Supp. 3d 725, 727 (E.D. Mo. 2021).
1
The Honorable John A. Ross, United States District Judge for the Eastern
District of Missouri.
2
For purposes of this appeal, we assume the truth of the allegations set forth in
the Andersons’ complaint. See Suburban Leisure Ctr., Inc. v. AMF Bowling Prods.,
Inc., 468 F.3d 523, 525 (8th Cir. 2006).
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After settling with Aflac, the Andersons filed suit against Hansen. Relevant to
the present appeal, the Andersons raised tort claims for battery, assault, false
imprisonment, and loss of consortium.3 In response, Hansen moved to compel
arbitration based on Arbitration Agreements contained in the Andersons’ Associate’s
Agreements. The Andersons’ Arbitration Agreements provided:
[T]he parties agree that any dispute arising under or related in any way
to this Agreement (“Dispute”), to the maximum extent allowed under the
Federal Arbitration Act (“FAA”), shall be subject to mandatory and
binding arbitration, including any Dispute arising under federal, state or
local laws, statutes or ordinances . . . or arising under federal or state
common law . . . . It is further agreed that, in any Dispute between the
parties, all past and present officers, stockholders, employees,
associates, coordinators, agents and brokers of Aflac, who are alleged
to be liable or may be liable in any manner to either party based upon the
same allegations made against a party to this Agreement, are intended
to be third-party beneficiaries of this Arbitration Agreement with full
rights to enforce it. Associate also understands and agrees that,
regardless of whether Aflac is a party, this Arbitration Agreement shall
be applicable to any dispute between Associate and any past and present
officers, stockholders, employees, associates, coordinators, agents and
brokers of Aflac.
R. Doc. 47-4, at 19–20, 43–44.
In his motion to compel, Hansen argued that he is a third-party beneficiary
under the Arbitration Agreements and, therefore, the entire action must be submitted
to arbitration. The Andersons responded that Hansen had waived any right he may
have to arbitration and, in the alternative, their claims fell outside the scope of the
Arbitration Agreements.
3
The Andersons also brought a claim for tortious interference with contract.
This claim is not at issue in the present appeal.
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Relevant to the present appeal, the district court rejected the Andersons’
argument that Hansen had waived his right to arbitration. But the court also denied
Hansen’s motion to compel arbitration of the Andersons’ tort claims for battery,
assault, false imprisonment, and loss of consortium. The court held that those claims
“are not claims ‘arising under or related in any way to’ the Associate’s Agreements.”
Anderson, 550 F. Supp. 3d at 731. Instead, the court reasoned, the “claims [were] for
an alleged sexual assault and ‘rest on independent . . . grounds, which have no
relation to the terms of the Agreement and in no way depend on its existence.’” Id.
at 732 (second alteration in original) (quoting Zetor N. Am., Inc. v. Rozeboom, 861
F.3d 807, 811 (8th Cir. 2017)). The court explained that the Andersons’ allegations
that Hansen “drugged Katherine Anderson at a bar and proceeded to forcibly rape her
in a hotel room. . . . are not in any way related to Katherine Anderson’s role as a
Regional Sales Coordinator for Aflac.” Id. The court determined with “‘positive
assurance’ that there is no reasonable interpretation of the Arbitration Agreements
pursuant to which the aforementioned claims could be subject to arbitration.” Id.(quoting Parm v. Bluestem Brands, Inc., 898 F.3d 869, 873–74 (8th Cir. 2018)).
II. Discussion
On appeal, Hansen argues that the district court erred in denying his motion to
compel arbitration on the Andersons’ tort claims for battery, assault, false
imprisonment, and loss of consortium because those claims are related to the
Andersons’ Associate’s Agreements with Aflac. Specifically, Hansen argues that the
claims “touch matters covered by the arbitration provision” and therefore are subject
to arbitration. Appellant’s Br. at 9 (quoting Parm, 898 F.3d at 874).
The Federal Arbitration Act vests us with jurisdiction over this interlocutory
appeal. See 9 U.S.C. § 16(a)(1)(B) (“An appeal may be taken from . . . an order
. . . denying a petition under section 4 of this title to order arbitration to
proceed . . . .”).
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We review de novo the district court’s denial of a motion to
compel arbitration based on contract interpretation. If the district court’s
order concerning arbitrability is based on factual findings, we review
such findings for clear error. Arbitration is a matter of contract and a
party cannot be required to submit to arbitration any dispute which he
has not agreed so to submit. The Federal Arbitration Act limits a district
court’s initial role in any challenge to an arbitration agreement to 1)
whether the agreement for arbitration was validly made and 2) whether
the arbitration agreement applies to the dispute at hand, i.e., whether the
dispute falls within the scope of the arbitration agreement.
Unison Co. v. Juhl Energy Dev., Inc., 789 F.3d 816, 818 (8th Cir. 2015) (cleaned up).
Here, neither party disputes the validity of the Arbitration Agreements; instead,
they disagree about whether the Arbitration Agreements apply to the Andersons’
claims.
We must liberally construe a valid arbitration clause, resolving
any doubts in favor of arbitration unless it may be said with positive
assurance that the arbitration clause is not susceptible of an
interpretation that covers the asserted dispute. In making this
determination, we must decide whether the arbitration clause is broad or
narrow. If the clause is broad, the liberal federal policy favoring
arbitration agreements requires that a district court send a claim to
arbitration as long as the underlying factual allegations simply touch
matters covered by the arbitration provision.
Id. (cleaned up).
The Arbitration Agreements provide that
any dispute arising under or related in any way to this Agreement
(“Dispute”), to the maximum extent allowed under the Federal
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Arbitration Act (“FAA”), shall be subject to mandatory and binding
arbitration, including any Dispute arising under federal, state or local
laws, statutes or ordinances . . . or arising under federal or state common
law . . . .
R. Doc. 47-4, at 19–20, 43–44 (emphasis added).
“The Andersons do not dispute that the arbitration clause at issue is broad.”
Appellees’ Br. at 7. “Because the arbitration clause is broad, we must . . . determine
whether the underlying factual allegations touch on matters covered by the arbitration
clause.” Unison Co., 789 F.3d at 819. The factual allegations underlying the
Andersons’ claims for battery, assault, false imprisonment, and loss of consortium
pertain to Hansen’s alleged sexual assault of Katherine.
As the district court correctly observed, we have not previously “addressed
whether tort claims for sexual assault arise out of or are related to an employment
contract.” Anderson, 550 F. Supp. 3d at 731. But our sister circuits have considered
“arbitration provision[s] and factual allegations similar to those in the present case.”
Doe v. Princess Cruise Lines, Ltd., 657 F.3d 1204, 1215 (11th Cir. 2011) (citing
Jones v. Halliburton Co., 583 F.3d 228 (5th Cir. 2009)).
For example, in Doe, the Eleventh Circuit held that an arbitration provision
limited to claims “relating to or in any way arising out of or connected with the Crew
Agreement, these terms, or services performed for the Company” did not extend to
tort claims based on allegations that a coworker sexually assaulted the plaintiff in a
crewmember’s cabin on a cruise ship. Id. at 1218. There, the plaintiff was a cruise-
line employee who signed a contractual agreement with the cruise line containing an
“Arbitration Notice & Agreement” in which the employee “agree[d] that any and all
disputes shall be referred to and resolved by binding arbitration as provided for in the
Principal Terms and Conditions of Employment.” Id. at 1214. In turn, that document
contained an arbitration provision, stating:
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. . . [T]he Company and crew member agree that any and all disputes,
claims, or controversies whatsoever (whether in contract, regulatory,
tort or otherwise and whether pre-existing, present or future and
including constitutional, statutory, common law, admiralty, intentional
tort and equitable claims) relating to or in any way arising out of or
connected with the Crew Agreement, these terms, or services performed
for the Company, including but not limited to wage and benefit matters,
employment applications, wrongful termination or discrimination
claims, property loss or damage, personal injury, death or any other
claim, no matter how described, pleaded or styled [collectively,
“Disputes”] between the crew member and the Company or others,
including against the master, shipowner, vessel, vessel operator,
charterer, or any other third party, including also, but not limited to,
Princess Cruises, P&O Cruises Australia, and Cunard Line, shall be
referred to and resolved exclusively by binding arbitration. . . .
Id. at 1214–15 (alterations in original).
The cruise-line employee was drugged, raped, and physically injured by other
employees in a crewmember’s cabin while she was unconscious. Id. at 1209. She filed
suit against the cruise line, asserting, among others, tort claims for false
imprisonment, intentional infliction of emotional distress, spoliation of evidence,
invasion of privacy, and fraudulent misrepresentation. Id. at 1212. The cruise line
moved to compel arbitration. Id. The district court denied the motion, relying on
Jones. Id. In Jones, the Fifth Circuit had held that an employee’s tort claims, arising
from an alleged gang-rape of the employee while she was stationed at company
facility in Iraq, were not “related to” her employment within the meaning of
arbitration provision. 583 F.3d at 241. There, the sexual assault occurred
(1) . . . by several Halliburton/KBR employees in [the employee’s]
bedroom, after-hours, (2) while [the employee] was off-duty, (3)
following a social gathering outside of her barracks, (4) which was some
distance from where she worked, (5) at which social gathering several
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co-workers had been drinking (which, notably, at the time was only
allowed in “non-work” spaces).
Id. at 240.
On appeal in Doe, the cruise line attempted to distinguish Jones “based on the
fact that the ship is the very ‘framework’ of the seaman’s existence and unlike [the
employee in Jones], [the cruise-line employee] was ‘continually in the service of the
vessel and subject to the call of duty at any time’ simply by virtue of being a seaman.”
Doe, 657 F.3d at 1217. The Eleventh Circuit rejected this argument, concluding that
such an interpretation of the arbitration provision “would effectively erase the
arbitration provision’s limiting language.” Id. “If the cruise line had wanted a broader
arbitration provision,” the court explained,
it should have left the scope of it at “any and all disputes, claims, or
controversies whatsoever” instead of including the limitation that
narrowed the scope to only those disputes, claims, or controversies
“relating to or in any way arising out of or connected with the Crew
Agreement, these terms, or services performed for the Company.” That
would have done it, but the company did not do that. Instead, after
including that limiting language, it now argues that we should ignore the
limitation and force [the employee] to arbitrate any and all disputes,
claims, or controversies without regard to whether they relate to, arise
out of, or are connected with her employment or her service as an
employee. That we cannot do. If the language about employment and
services as an employee did not limit the scope of the arbitration
provision, it would have no purpose, and that is an interpretative no-no.
Id. at 1218 (citations omitted).
The court next addressed why “the terms used in the limiting language [of the
arbitration provision] are not unlimited in scope.” Id. First, the court acknowledged
that “[t]he term ‘arising out of’ is broad”; however, that broad term “is not all
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encompassing.” Id. This is because the term “requires the existence of some direct
relationship between the dispute and the performance of duties specified by the
contract.” Id. (citing Telecom Italia, SpA v. Wholesale Telecom Corp., 248 F.3d 1109,
1116 (11th Cir. 2001) (“Disputes that are not related—with at least some
directness—to performance of duties specified by the contract do not count as
disputes ‘arising out of’ the contract, and are not covered by the standard arbitration
clause.”)). Second, the court characterized the term “related to” as “limiting
language” that “marks a boundary by indicating some direct relationship.” Id. Third,
the court defined “[c]onnected with” as “connot[ing] the necessity of some direct
connection.” Id. at 1219.
Applying these definitions, the court held that the tort claims were not within
the scope of the arbitration provision because they did “not arise from, . . . relate to,
. . . and [were] not connected with the parties’ crew agreement or the services that
[the employee] performed for Princess Cruise Lines.” Id. This was because “those
claims involve[d] factual allegations about how the cruise line and its officials treated
[the employee] after learning that she had been raped . . . . Nothing about those
allegations relate[d] to, ar[o]se out of, or [were] connected with [the employee’s]
crew agreement or her duties for Princess Cruise Lines as a bar server.” Id. The court
pointed out that “[t]he cruise line could have engaged in that tortious conduct even
in the absence of any contractual or employment relationship with [the employee].”
Id. The court characterized as “incidental” the “fact that [the employee] might not
have been on the cruise ship if she had not been working for the cruise line”; that fact
did not render “her claims relate[d] to, aris[ing] from, or . . . connected with the crew
agreement and the services that she performed as an employee.” Id. The court
reasoned that “[t]he parties could each have fulfilled all of their duties under the crew
agreement and [the employee] could have perfectly performed her services for the
cruise line, and the parties still be embroiled in the dispute alleged in [the employee’s]
common law claims.” Id. at 1219–20. The court illustrated its point:
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[A] passenger could have brought these same [tort] claims against the
cruise line based on virtually the same alleged facts: a crew member
invited the passenger to a crew party in a cabin; the crew member gave
the passenger an open beer that turned out to contain a date rape drug;
the passenger woke up in the crew cabin and realized she had been
raped; cruise line officials treated the passenger with contempt, delayed
her attempt to report of the rape, would not let her leave the ship, and
otherwise hindered her efforts to meet with an attorney and to get
medical treatment onshore.
Id. at 1220. Because it concluded that “those five [common-law tort] claims [were]
not ‘an immediate, foreseeable result of the performance’ of the parties’ contractual
duties or [the employee’s] services as a Princess Cruise Lines employee,” the court
held that they were “not within the scope of the arbitration clause.” Id. at 1219.
“The Jones and Doe courts both accepted that the sexual assault alleged in each
case would not have occurred ‘but for’ the plaintiff’s employment with the defendant
company, but determined nonetheless that the circumstances giving rise to the claim
were outside the scope of her employment.” Cooper v. Ruane Cunniff & Goldfarb
Inc., 990 F.3d 173, 183 (2d Cir. 2021). Both courts reasoned that “‘[r]elatedness’
could not encompass everything that touched employment in any way.” Id. “[I]n the
context of an employment arbitration agreement, a claim will ‘relate to’ employment
only if the merits of that claim involve facts particular to an individual plaintiff’s own
employment.” Id. at 184 (citing United States ex rel. Welch v. My Left Foot
Children’s Therapy, LLC, 871 F.3d 791, 799 (9th Cir. 2017) (“[W]e are persuaded
by the reasoning of the Fifth And Eleventh Circuits, which have previously
interpreted arbitration agreements covering disputes that ‘arise out of’ or ‘relate to’
a contractual or employment relationship.”)).
We find Jones and Doe persuasive in resolving whether the Andersons’
allegations of sexual assault touch matters covered by the Andersons’ Arbitration
Agreements. Cf. Donaldson Co. v. Burroughs Diesel, Inc., 581 F.3d 726, 731 (8th
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Cir. 2009) (“[F]ederal substantive law of arbitrability governs whether the litigants’
dispute falls within the scope of the arbitration agreement.”). The Andersons’
Arbitration Agreements provide that “any dispute arising under or related in any way
to th[e] [Associate’s] Agreement . . . shall be subject to mandatory and binding
arbitration.” R. Doc. 47-4, at 19, 43. This language is substantially similar to the Doe
arbitration provision, which used the phrase “relating to or in any way arising out of
or connected with the Crew Agreement.” Doe, 657 F.3d at 1218.
Applying Doe’s definitions of “arising” and “related to” to the present case
means that the Andersons’ underlying factual allegations of sexual assault must have
some “direct relationship” with the Andersons’ Associate’s Agreements to be
arbitrable. See id. at 1218. They do not. All of the Andersons’ tort claims involve
factual allegations about Hansen drugging Katherine Anderson at a bar and forcibly
raping her in a hotel room. Nothing about those allegations arose under or related in
any way to the Andersons’ Associate’s Agreements. See id. at 1219.
Just like the perpetrators in Jones and Doe, Hansen could have engaged in the
alleged “conduct even in the absence of any contractual or employment relationship
[between Aflac and the Andersons].” Id. The “fact that [Katherine Anderson] might
not have been” at a bar and staying in a hotel but for the Aflac work conference was
an “incidental” fact. Id. In other words, “[t]he parties could each have fulfilled all of
their duties under the [Associate’s Agreements] and [Katherine Anderson] could have
perfectly performed her services for [Aflac], and the parties [would] still be embroiled
in the dispute alleged in [t]he [tort] claims.” Id. at 1219–20; see also Jones, 583 F.3d
at 240.
In summary, we hold that the Andersons’ tort claims do not fall within the
scope of the Arbitration Agreements. The facts underlying the Andersons’ tort claims
do not touch matters covered by the Andersons’ Arbitration Agreements in light of
the Agreements’ limiting language requiring the “dispute aris[e] under or relate[] in
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any way to th[e] [Associate’s] Agreement[s].” R. Doc. 47-4, at 19, 43 (emphasis
added). As a result, the district court did not err in denying Hansen’s motion to
compel arbitration.4
III. Conclusion
Accordingly, we affirm the judgment of the district court.
GRASZ, Circuit Judge, dissenting.
This case illustrates the old adage that “bad facts make bad law.” The facts
here are indeed bad: the Andersons alleged Katherine was drugged and raped in her
hotel room during a work conference and then suffered emotional and psychological
symptoms that had a lasting impact on her career. Faced with these bad facts, the
court sidesteps our precedent on arbitration and instead blazes a new trail by relying
on caselaw from other circuits. While the court’s outcome may be preferable as a
matter of public policy, I believe it is at odds with our precedent. I therefore
respectfully dissent.
The Andersons agreed to arbitrate any dispute “arising under or related in any
way to” the Associate Agreement. We have said such arbitration clauses with
“arising out of” or “relating to” language “constitute[] the broadest language the
parties could reasonably use to subject their disputes to that form of settlement[.]”
Parm v. Bluestem Brands, Inc., 898 F.3d 869, 874 (8th Cir. 2018) (quoting Fleet Tire
Serv. Of N. Little Rock v. Oliver Rubber Co., 118 F.3d 619, 621 (8th Cir. 1997)).
Indeed, such provisions even cover “collateral disputes that relate to the agreement
containing the clause.” Id. (quoting same). For broad clauses like this one, we
4
Because we hold that the claims’ underlying factual allegations do not fall
within the scope of the Arbitration Agreements, we need not address whether Hansen
is a third-party beneficiary of such agreements or whether Hansen waived his right
to arbitration.
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enforce arbitration if “the underlying factual allegations simply touch matters covered
by the arbitration provision.” Id. (quoting Unison Co. v. Juhl Energy Dev., Inc., 789
F.3d 816, 818 (8th Cir. 2015)).
The court, however, evades these well-established principles. After
acknowledging that our caselaw specifies the factual allegations need only “simply
touch matters covered by the arbitration provision,” ante, at 5, the court then borrows
language from the Eleventh Circuit that “requires the existence of some direct
relationship between the dispute and the performance of duties specified by the
contract.” Id. (quoting Doe v. Princess Cruise Lines, Ltd., 657 F.3d 1204, 1218 (11th
Cir. 2011)). The court then seemingly adopts a “but for” test employed by the Second
Circuit. See id. at 10 (citing Cooper v. Ruane Cunniff & Goldfarb Inc., 990 F.3d 173,
183 (2d Cir. 2021)). How those two tests can be reconciled with ours—which covers
“collateral disputes” and requires only that the factual allegations “simply touch
matters covered by the arbitration provision”—is unexplained.
Applying our circuit’s framework here, I believe that the Andersons’
allegations “simply touch” the Associate Agreement and are thus subject to
arbitration. The Andersons allege that, because of the rape, Katherine continually
struggled interacting with Hansen at work, and eventually concluded she was unable
to maintain a leadership position with Aflac and requested a demotion. By the
Andersons’ own admission, Katherine’s work was terminated “[a]s a direct and
proximate result of the rape[.]” In the settlement agreement between the Andersons
and Aflac, the Andersons asserted they had “potential claims against Aflac related to”
the alleged rape. The settlement agreement also outlined the Andersons’ termination
of independent contractor status. Considering these facts, I believe the Andersons’
claims “touch” the Associate Agreement.
It may be that, as a matter of public policy, the court should deviate from our
established standard. This path may be all the more appealing in this particular case
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in light of the passage and signing of the “Ending Forced Arbitration of Sexual
Assault and Sexual Harassment Act of 2021,” Pub. L. No. 117-90, 136 Stat. 26(“EFASASH Act”). But the court’s opinion does not grapple with that question, and
the Andersons did not meaningfully develop a public policy argument. In any event
this panel cannot overrule circuit precedent, see United States v. Spencer, 998 F.3d
813, 819 n.3 (8th Cir. 2021), and, as numerous district courts have recognized, the
EFASASH Act cannot be applied retroactively. See, e.g., Matthews v. Gucci, 2022
WL 462406, at *11 n.8 (E.D. Penn. Feb. 15, 2022) (noting “the [EFASASH] Act does
not apply here since this case arose before its enactment”). So, while I sympathize
with desire to allow the Andersons to litigate in court, I do not believe this is what the
law today allows. I respectfully dissent.
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