United States District Court, E.D. Kentucky, Central Division, Lexington
GOLDEN GATE NATIONAL SENIOR CARE, LLC, et al. Plaintiffs,
PAT BROWN and GARY BROWN, Defendants.
MEMORANDUM OPINION & ORDER
M. HOOD, SENIOR U.S. DISTRICT JUDGE
matter is before the Court on Plaintiff's Motion for
Expedited Consideration of Complaint to Enforce the
Alternative Resolution Agreement and to Compel Defendants to
Submit Their Claims to Arbitration [DE 4] and Defendants
Motion to Dismiss [DE 8], both of which have been fully
briefed by the parties.Defendants ask this Court to determine
that it lacks jurisdiction in this matter or, in the
alternative, abstain from exercising jurisdiction and to
dismiss the Plaintiffs' Complaint under the Colorado
River abstention doctrine in favor of a parallel state
court action pending in the Lincoln Circuit Court. They
further assert that, in any event, that any injunctive relief
would be inappropriate under the Anti- Injunction Act. As
explained below, the Court disagrees. Rather, Plaintiffs'
Motion to Enforce the Alternative Resolution Agreement and to
Compel Defendants to Submit Their Claims to Arbitration [DE
4] is well-received, at least in part. For the reasons which
follow, relief will be afforded both parties, but Defendants
will be enjoined from pursuing a subset of all but Gary
Brown's loss of spousal consortium claim before the
Lincoln Circuit Court.
September 27, 2016, Defendant Pat Brown was admitted to
Golden LivingCenter - Stanford (“GLC - Stanford”
or the “facility) in Stanford, Kentucky. During the
admission process, Pat Brown signed a document titled
“ALTERNATIVE DISPUTE RESOLUTION AGREEMENT, ”
which provided for,
[a]ny and all disputes arising out of or in any way relating
to this Agreement or 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 the 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.
further provides that it “shall be governed by and
interpreted under the Federal Arbitration Act, 9 U.S.C.
§§ 1 et seq.” and that “[a]ll claims
based in whole or in part on the same incident, transaction,
or related course of care or services provided by the
Facility to the Resident shall be addressed in a single ADR
process, which shall adjudicate solely the claims of the
Parties named in this Agreement....” The Agreement
provides that it is binding upon Pat Brown and “all
persons whose claim is or may be derived through or on behalf
of [her], including any next of kin, guardian, executor,
administrator, legal representative or heir” and the
facility and “its employees, agents, officers,
directors, affiliates and any parent or subsidiary of the
Facility and its medical director acting in his or her
capacity as medical director.” The Agreement is to
“inure to the benefit of, bind, and survive” the
parties, “their successors, and assigns.”
Agreement also provides that it “GOVERNS IMPORTANT
LEGAL RIGHTS” and that one should “PLEASE READ IT
CAREFULLY AND IN ITS ENTIRETY BEFORE SIGNING.” It
further advises that one has a right “to seek advice of
legal counsel concerning this Agreement” and that
signing it was “not a condition to admission to or
residence in the [f]acility.” The Agreement was also,
by its terms, revocable “by sending written notice to
the Facility within 30 days of signing it.”
is no dispute that Pat Brown signed the agreement or that she
never revoked the Agreement. Just under her signature, the
Agreement reads, “[b ]y 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.” Gary Brown did not sign the Agreement.
March 9, 2017, Pat and Gary Brown filed an action in Lincoln
Circuit Court, Civil Action No. 17-CI-00104, asserting
negligence, medical negligence, corporate negligence,
violations of long term care resident's rights under KRS
216.510, et seq., and loss of spousal consortium
against Plaintiffs as a result of the care that Pat Brown
received at the facility. The Browns also brought a claim of
negligence against Barbara Woods and Lisa Davis, both of whom
are citizens of Kentucky and served as administrators of the
facility during Pat Brown's residence, in the state court
action. No. substantive rulings related to the enforceability
of the Agreement have been made in the Lincoln Circuit Court.
Neither Woods nor Davis are named as plaintiffs in the matter
at bar before this Court.
virtue of their Complaint in this action, Plaintiffs ask this
Court to enforce an arbitration agreement entered into by Pat
Brown, and GLC - Stanford, and to stay the pursuit of the
action in Lincoln Circuit Court in order that any arbitration
ordered may proceed.
initial matter and in the face of Defendant's Motion to
Dismiss Plaintiffs' claims pursuant to Fed.R.Civ.P.
12(b)(1) and (7), the Court concludes that it has
jurisdiction to consider this matter. Defendants argue that
there is no jurisdiction because Plaintiffs have failed to
join a necessary party under Rule 19 and, once the
citizenship of that necessary party is taken into account,
there is a lack of subject-matter jurisdiction under 28
U.S.C. § 1332 because (1) the parties will not be of
diverse citizenship and (2) the Federal Arbitration Act will
not, alone, create a federal question which would confer
jurisdiction under 28 U.S.C. § 1331 in this matter upon
this Court. For the same reasons announced in
Preferred Care, Inc. v. Belcher, No.
14-CV-107-JMH, 2015 WL 1481537, at *1-3 (E.D. Ky. Mar. 31,
2015), the Court disagrees.
12(b)(1) motion can either attack the claim of jurisdiction
on its face, in which case all allegations of the plaintiff
must be considered as true, or it can attack the factual
basis for jurisdiction, in which case the trial court must
weigh the evidence and the plaintiff bears the burden of
proving that jurisdiction exists. See RMI Titanium Co. v.
Westinghouse Elec. Corp., 78 F.3d 1125, 1133-35 (6th
Cir.1996); United States v. Ritchie, 15 F.3d 592,
598 (6th Cir.1994); Ohio Nat'l Life Ins. Co. v.
United States, 922 F.2d 320, 325 (6th Cir.1990).
U.S.C. § 1332 provides that “district courts shall
have original jurisdiction of all civil actions where the
matter in controversy exceeds the sum or value of $75, 000,
exclusive of interest and costs, and is between ... citizens
of different States, ” and Plaintiffs contend that this
Court has jurisdiction based on the diversity of the parties.
In the instant action, there is no dispute that the amount in
controversy exceeds the sum or value of $75, 000, exclusive
of interest and costs. Further, there is no dispute that
Defendants are residents of Kentucky and that each of the
named Plaintiffs in this action is a citizen of another
state. However, Woods and Davis, nursing home administrators
named as defendants in the state complaint but not as a party
in the present matter, are citizens of Kentucky. Defendants
claim that complete diversity of citizenship among the
parties in this case cannot be maintained because, while
Woods and Davis are not named as plaintiffs in this action,
they are indispensable parties under Fed.R.Civ.P. 19 and
their joinder would destroy the complete diversity among
parties required by 28 U.S.C. 1332(a)(1).
of subject-matter jurisdiction is raised in a motion to
dismiss, the plaintiff “bears the burden of proving
jurisdiction ... to survive the motion.” Mich. S.
R.R. Co. v. Branch & St. Joseph Counties Rail Users
Ass'n, 287 F.3d 568, 573 (6th Cir .2002). However,
the plaintiff will “survive [a] motion to dismiss by
showing ‘any arguable basis in law' for the claims
set forth in the complaint.” Id. (quoting
Musson Theatrical, Inc. v. Fed. Express Corp., 89
F.3d 1244, 1248 (6th Cir.1996)).
argue that Woods and Davis are necessary and indispensable
parties to this action and that, since their joinder would
destroy diversity in this action, subject matter jurisdiction
is lacking and the matter must be dismissed.
existence of a non-diverse party in the related state court
action does not, on its own, destroy diversity:
Rule 19 deals with what were historically known as
“necessary” and “indispensable”
parties. The terms “necessary” and
“indispensable” are terms of art in jurisprudence
concerning Rule 19, and “necessary” refers to a
party who should be joined if feasible, while
“indispensable” refers to a party whose
participation is so important to the resolution of the case
that, if the joinder of the party is not feasible, the suit
must be dismissed. If a necessary party cannot be joined
without divesting the court of subject-matter jurisdiction,
the Rule provides additional criteria for determining whether
that party is indispensable, but if the court finds that the
party is anything less than ...