United States District Court, W.D. Kentucky, Louisville Division
GGNSC LOUISVILLE ST. MATTHEWS, LLC, d/b/a/ GOLDEN LIVING CENTER - ST. MATTHEWS, PLAINTIFFS
ILENE PHILLIPS DEFENDANT
MEMORANDUM OPINION AND ORDER
H. McKINLEY, JR., CHIEF JUDGE UNITED STATES DISTRICT COURT.
matter is before the Court on the motion by plaintiffs GGNSC
Louisville St. Matthews LLC, d/b/a Golden Living Center - St.
Matthews; GGNSC Administrative Services, LLC; GGNSC Holdings,
LLC; GGNSC Equity Holdings, LLC; GGNSC Equity Holdings II,
LLC; Golden Gate National Senior Care, LLC; Golden Gate
Ancillary, LLC; GGNSC Clinical Services, LLC; and GPH
Louisville St. Matthews, LLC (“plaintiffs”) to
expedite consideration of their petition to compel
arbitration (DN 4), as well as the motion by defendant Ilene
Phillips to dismiss. (DN 7.) These matters are ripe for
Phillips was a resident of Golden Living Center - St.
Matthews from October 1, 2016, until March 1, 2017. Prior to
her admittance, she signed an “Alternative Dispute
Resolution Agreement” (“ADR agreement”).
(DN 1-3.) This agreement stated that Phillips agreed to
resolve “any disputes covered by this Agreement . . .
exclusively by an ADR process . . .” (Id. at
2.) Covered disputes included “violation[s] of a right
claimed to exist under federal, state, or local law . . .
tort . . . consumer protection . . . negligence; gross
negligence; malpractice; and any alleged departure from any
applicable . . . medical, health care, consumer, or safety
standards.” (Id. at 4.) The ADR agreement
states on its first page in bold capital letters that
“[t]his agreement is not a condition of admission to or
continued residence in the facility.” (Id. at
2.) Underneath Phillips' signature, the ADR agreement
reads, “By my signature, I acknowledge that I have read
this Agreement or had it read to me, that I understand what I
am signing, and that I accept its terms.” (Id.
her residency, Phillips alleges that she suffered physical
and emotional injuries due to inadequate care, and her health
and physical condition deteriorated beyond that caused by the
normal aging process. She filed a civil action in Jefferson
Circuit Court against all of the named plaintiffs in this
case, as well as two other corporate entities, Redwood
Holdings, LLC and Providence Healthcare Management, Inc.; a
named administrator of the facility, Joshua Lee Schindler;
and three unnamed defendants who provided care for Phillips
while she was a resident. (DN 1-2.) The plaintiffs in this
case then filed the present action, seeking to compel
arbitration of Phillips' claims. (DN 1.) The plaintiffs
have filed a motion for expedited consideration of their
petition. (DN 4.) Phillips did not respond to this motion,
but she has filed a separate motion to dismiss that the Court
will consider. (DN 7.)
Phillips' Motion to Dismiss
sister court recently stated when faced with a similar case
seeking to compel arbitration of claims arising from a
nursing home stay, “[w]e have been here before.”
Richmond Health Facilities-Madison, L.P. v. Shearer,
2017 WL 3273381, at *1 (E.D. Ky. Aug. 1, 2017). The motion to
dismiss makes numerous arguments in favor of dismissal, but
all of the asserted grounds for dismissal have been raised by
defense counsel in other cases before this Court and others,
and they have been denied by the courts in those cases.
E.g., Owensboro Health Facilities, L.P. v.
Henderson, 2016 WL 2853569 (W.D. Ky. May 13, 2016);
GGNSC Louisville Hillcreek, LLC v. Watkins, 2016 WL
815295 (W.D. Ky. Feb 29, 2016). Thus, the Court will only
briefly address each.
Failure to Join a Necessary Party
argues that the action should be dismissed for the failure to
join the named administrator who is a defendant in the state
court action, as this individual is a necessary and
indispensable party under Fed.R.Civ.P. 19. However,
“[t]he Court can and will decide the entire controversy
without the administrators being named in the suit, ”
as the administrators “have the same interest as [the
corporate defendants] in this case: to compel
arbitration.” Watkins, 2016 WL 815295, at
*2-3. Nor will the existing parties “incur inconsistent
obligations” if the administrator is not joined.
Id. at *3. Therefore, Rule 19 does not apply, and
the Court will not dismiss for the failure to join the
administrator. Accord Owensboro Health Facilities, L.P.
v. Canary, 2017 WL 1015859, at *2 (W.D. Ky. Mar. 15,
2017); Henderson, 2016 WL 2853569, at *2;
Preferred Care of Del, Inc. v. Blankenship, 2016 WL
7192127, at *2 (W.D. Ky. Dec. 12, 2016).
Failure to State a Claim
makes two arguments in favor of dismissal pursuant to
Fed.R.Civ.P. 12(b)(6). First, she argues that the agreement
is unenforceable under the Federal Arbitration Act
(“FAA”) as it does not evidence a transaction
involving interstate commerce. However, “[m]any cases
have found that the FAA applies to arbitration agreements
involving nursing home residents, ” with these cases
recognizing “that it would be impracticable for the
nursing home to procure all goods necessary for the daily
operations purely through intrastate channels.”
Preferred Care of Del., Inc. v. Crocker,
173 F.Supp.3d 505, 514 (W.D. Ky. 2016) (citations omitted).
Thus, the Court rejects this argument.
second, Phillips argues that arbitration agreement is
unconscionable. This argument is “baseless, ” as
“[t]here was nothing either procedurally or
substantively unconscionable about this arbitration
agreement.” Watkins, 2016 WL 815295, at *5-6.
Voluminous paperwork and disparate bargaining power alone do
not make an arbitration agreement unconscionable, especially
one that clearly indicates it is not required for admission.
Thus, the Court rejects this argument. Accord
Canary, 2017 WL 1015859, at *3; Henderson, 2016
WL 2853569, at *2; Blankenship, 2016 WL 7192127, at
Lack of Subject ...