United States District Court, W.D. Kentucky, Bowling Green Division
GGNSC GREENSBURG, LLC d/b/a GOLDEN LIVINGCENTER - GREEN HILL; GOLDEN GATE NATIONAL SENIOR CARE, LLC; GGNSC ADMINISTRATIVE SERVICES, LLC; GGNSC HOLDINGS, LLC; GGNSC EQUITY HOLDINGS, LLC; GGNSC EQUITY HOLDINGS II, LLC; GOLDEN GATE ANCILLARY, LLC; and GGNSC CLINICAL SERVICES, LLC PLAINTIFFS
ANGELA MARIE SMITH, as Administratrix of the ESTATE OF GENEVA ANN JANES, Deceased DEFENDANT
MEMORANDUM OPINION AND ORDER
N. Stivers, Judge United States District Court.
matter is before the Court on Plaintiffs' Motion to
Compel Arbitration (DN 5) and Defendant's Motion to
Dismiss (DN 10). The motions have been fully briefed by the
parties and are ripe for adjudication. For the reasons
outlined below, the Motion to Compel Arbitration is
GRANTED IN PART and DENIED IN
PART, and the Motion to Dismiss is GRANTED
IN PART and DENIED IN PART.
SUMMARY OF FACTS AND CLAIMS
24, 2003, Geneva Janes (“Janes”) executed a
general power of attorney instrument (“POA”).
(Compl. Ex. C, DN 1-4). Under the terms of the POA, Janes
designated Angela Marie Smith (“Smith”) as her
about the time of Janes' admission to Golden LivingCenter
- Green Hill, which is a facility operated by Plaintiffs,
Smith executed a document entitled “Alternative Dispute
Resolution Agreement” (“Agreement”) on
Janes' behalf. (Compl. Ex. A, at 1-4, DN 1-2). The
Agreement provides that “[t]he Parties agree that any
disputes covered by this Agreement (‘Covered
Disputes') that may arise between them shall be resolved
exclusively by an ADR process that shall include mediation
and, where mediation is not successful, binding
arbitration.” (Compl. Ex. A, at 1). The term
“Covered Disputes” is defined as:
any and all disputes arising out of or in any way relating to
this Agreement or to the Resident's stay at the Facility
or the Admissions Agreement between the Parties that would
constitute a legally cognizable cause of action in a court of
law sitting in the state where Facility is located. Covered
Disputes include but are not limited to all claims in law or
equity arising from one Party's failure to satisfy a
financial obligation to the other Party; a violation of a
right claimed to exist under federal, state, or local law or
contractual agreement between the Parties; tort; breach of
contract; consumer protection; fraud; misrepresentation;
negligence; gross negligence; malpractice; and any alleged
departure from any applicable federal, state, or local
medical, health care, consumer, or safety standards.
(Compl. Ex. A, at 2).
14, 2017, Smith, as Administratrix of Janes' estate,
filed a lawsuit in Green Circuit Court entitled Smith v.
GGNSC Greensburg, LLC et al., Civil Action No.
17-CI-00079 (the “State Court Action”). In the
state court complaint, Smith asserted claims against
Plaintiffs for, inter alia, negligence, medical
negligence, and wrongful death. (Compl. Ex. B, ¶¶
27-40, 63-66). Following the initiation of the State Court
Action, Plaintiffs filed this action in federal court
asserting jurisdiction under 28 U.S.C. § 1332(a) and
Section 4 (9 U.S.C. § 4) of the Federal Arbitration Act
(“FAA”), 9 U.S.C. §§ 1-16. (Compl.
¶ 15, DN 1). Plaintiffs seek to enforce the Agreement
executed by Janes' attorney-in-fact, and Smith has moved
to dismiss this case on various bases. (Compl. ¶¶
28-31; Pl.'s Mem. Supp. Mot. Compel Arbitration 3-21, DN
5-1; Def.'s Mem. Supp. Mot. Dismiss & Resp. Pl.'s
Mot. Compel Arbitration 3-36, DN 10-1).
support of her motion to dismiss, Smith asserts various bases
pursuant to Fed.R.Civ.P. 12(b)(1), 12(b)(6), and 12(b)(7). In
particular, she raises the following arguments: (i) the Court
lacks subject matter jurisdiction; (ii) Plaintiffs failed to
join indispensable parties-namely nursing home personnel who
are defendants in the State Court Action-as parties to this
action; (iii) the Court should abstain from exercising
jurisdiction based upon the Colorado River
abstention doctrine; (iv) the Agreement is invalid and
unenforceable; (v) the Agreement is unconscionable; and (vi)
Plaintiffs' request for injunctive relief would violate
the Anti-Injunction Act, 28 U.S.C. § 2283. (Def.'s
Mem. Supp. Mot. Dismiss & Resp. Pl.'s Mot. Compel
Arbitration 3-36, DN 10-1). These same arguments have been
unsuccessfully raised in numerous other recent cases before
this Court challenging the enforcement of arbitration
agreements between nursing homes and its residents or the
residents' estates. See GGNSC Louisville St. Matthews
v. Grevious, No. 3:16-cv-829-DJH, 2017 WL 3623805 (W.D.
Ky. Aug. 23, 2017); GGNSC Louisville St. Matthews, LLC v.
Phillips, No. 3:17-CV-00406-JHM, 2017 WL 3446181 (W.D.
Ky. Aug. 10, 2017); GGNSC Louisville Camelot, LLC v.
Coppedge, No. 3:16-CV-00834-TBR, 2017 WL 3430579 (W.D.
Ky. Aug. 9, 2017); GGNSC Louisville St. Matthews v.
Madison, No. 3:16-CV-00830-TBR, 2017 WL 2312699 (W.D.
Ky. May 26, 2017); GGNSC Louisville St. Matthews, LLC v.
Saunders, No. 3:17-cv-00185-CRS-CHL, 2017 WL 2196752
(W.D. Ky. May 18, 2017); GGNSC Louisville Mt. Holly, LLC
v. Turner, No. 3:16-CV-00149-TBR, 2017 WL
537200 (W.D. Ky. Feb. 9, 2017); GGNSC Louisville Mt.
Holly LLC v. Stevenson, No. 3:16CV-00423-JMH, 2016 WL
5867427 (W.D. Ky. Oct. 6, 2016); Preferred Care
of Del. Inc. v. Estate of Hopkins, No.
5:15-CV-00191-GNS-LLK, 2016 WL 3546407 (W.D. Ky. June 22,
2016); Diversicare Highland, LLC v. Lee, No.
3:15-CV-00836-GNS, 2016 WL 3512256 (W.D. Ky. June 21, 2016);
Golden Gate Nat'l Senior Care, LLC v. Fleshman,
No. 3:15-CV-00891-GNS, 2016 WL 3406159 (W.D. Ky. June 17,
2016); Owensboro Health Facilities, L.P. v.
Henderson, No. 4:16CV-00002-JHM, 2016 WL 2853569 (W.D.
Ky. May 12, 2016); Riney v. GGNSC Louisville St.
Matthews, LLC, No. 3:16CV-00122-JHM, 2016 WL 2853568
(W.D. Ky. May 12, 2016); GGNSC Louisville Mt. Holly, LLC
v. Mohamed-Vall, No. 3:16-cv-136-DJH, 2016 WL 9024811
(W.D. Ky. Apr. 6, 2016); Preferred Care of Del., Inc. v.
Crocker, No. 5:15-CV-177-TBR, 2016 WL 1181786 (W.D. Ky.
Mar. 24, 2016); GGNSC Louisville Hillcreek, LLC v.
Watkins, No. 3:15-cv-902-DJH, 2016 WL 815295 (W.D. Ky.
Feb. 29, 2016); Sun Healthcare Grp., Inc. v. Dowdy,
No. 5:13-CV-00169-TBR, 2014 WL 790916 (W.D. Ky. Feb. 26,
2014); Life Care Ctrs. of Am., Inc. v. Estate of
Neblett, No. 5:14-CV-00124-TBR, 2014 WL 5439623 (W.D.
Ky. Oct. 22, 2014). See also Preferred Care, Inc. v.
Howell, 187 F.Supp.3d 796 (E.D. Ky. 2016); GGNSC
Frankfort, LLC v. Tracy, No. CIV. 14-30-GFVT, 2015 WL
1481149 (E.D. Ky. Mar. 31, 2015).
considering the arguments of the parties and the cases
referenced above, the Court denies the motion to dismiss for
the reasons set forth in Estate of Neblett and
Crocker. In short, the Court finds that it has
subject matter jurisdiction, and that the nursing home
personnel are not indispensable parties to this action.
See Estate of Neblett, 2014 WL 5439623, at *2-7;
Crocker, 2016 WL 1181786, at *4-6. With regard to
the specific circumstances here, the Court will address the
issues of abstention, validity, unconscionability, and
enforceability of the Agreement, as well as the
inapplicability of the Anti-Injunction Act.
Colorado River Abstention Doctrine
asserts that the Court should abstain from exercising
jurisdiction based on Colorado River Water Conservation
District v. United States, 424 U.S. 800 (1976). In that
case, the Supreme Court recognized that federal courts should
sometimes abstain from exercising jurisdiction over an action
involving “substantially the same issues and
substantially the same parties as a parallel case in state
court.” Total Renal Care, Inc. v. Childers Oil
Co., 743 F.Supp.2d 609, 612 (E.D. Ky. 2010) (citing
Colorado River, 424 U.S. at 817-21). Such
abstention, however, should occur “only in the
exceptional circumstances where the order to the parties to
repair to the state court would clearly serve an important
countervailing interest.” Great Earth Cos. v.
Simons, 288 F.3d 878, 886 (6th Cir. 2002) (quoting
Colorado River, 424 U.S. at 813).
determining whether abstention is warranted, this Court must
consider the following factors:
(1) whether the state court has assumed jurisdiction over any
res or property; (2) whether the federal forum is less
convenient to the parties; (3) avoidance of piecemeal
litigation; . . . (4) the order in which jurisdiction was
obtained[;] . . . (5) whether the source of governing law is
state or federal; (6) the adequacy of the state-court action
to protect the federal plaintiff's rights; (7) the
relative progress of the state and federal proceedings; and
(8) the presence or absence of concurrent jurisdiction.
Id. (quoting PaineWebber, Inc. v. Cohen,
276 F.3d 197, 206 (6th Cir. 2001)). In the case sub
judice, there is no property at issue, which renders
the first factor irrelevant. As to the second factor, the two
courthouses are approximately 65 miles apart, which the Court
does not perceive as a significant inconvenience to the
parties. The Court also believes that there is no danger of
piecemeal litigation because the Court will compel
arbitration as to the estate's claims only and enjoin
Smith from pursuing those claims in state court. Although the
state court action was filed first, neither court has reached
the merits of the claim, which results in neither the fourth
or seventh factor weighing in favor of abstention. See
Id. at 887 (citing Moses H. Cone Mem'l Hosp. v.
Mercury Constr. Corp., 450 U.S. 1, 21-22 (1983)). As to
the fifth factor, the governing law is the FAA, and, under
the sixth factor, neither the state court nor this Court is
more likely to adequately protect Plaintiffs' rights,
which renders that factor neutral. Finally, concurrent
jurisdiction exists. Accordingly, the factors do not weigh in
favor of abstention.
arguing for abstention, Smith relies on the Sixth
Circuit's decision in Preferred Care of Delaware,
Inc. v. VanArsdale, 676 F. App'x 388 (6th Cir.
2017). (Def.'s Mem. Supp. Mot. Dismiss & Resp.
Pls.' Mot Compel Arbitration 19). As counsel is well
aware, however, this Court has previously distinguished
VanArsdale because the trial court in that case had
already held that the arbitration agreement was
unenforceable. See GGNSC Louisville Camelot, LLC v.
Coppedge, No. 3:16-CV-00834-TBR, 2017 WL 3430579, at *3
(W.D. Ky. Aug. 9, 2017). In the case sub judice, the
parties have not made this Court aware of any such ruling by
the Green Circuit Court, which distinguishes this case from
VanArsdale. For these reasons, the Court will not
abstain from exercising jurisdiction.
the FAA, a written agreement to arbitrate concerning a
dispute arising out of a contract involving interstate
commerce “shall be valid, irrevocable, and enforceable,
save upon such grounds as exist at law or in equity for the
revocation of any contract.” Stout v. J.D.
Byrider, 228 F.3d 709, 714 (6th Cir. 2000) (quoting 9
U.S.C. § 2). Smith asserts that the Agreement is invalid
because it does not evidence a transaction involving
interstate commerce. Specifically, Smith argues that
“[t]he mere fact that the ADR Agreement asserts that it