IN THE SUPREME COURT OF FLORIDA

Transcription

1 Filing # Electronically Filed 10/24/ :18:26 PM RECEIVED, 10/24/ :23:44, John A. Tomasino, Clerk, Supreme Court IN THE SUPREME COURT OF FLORIDA CASE NO. SC SUZANNE FOUCHE, Petitioner, v. PILOT CATASTROPHE SERVICES, INC., Respondent ON DISCRETIONARY REVIEW FROM THE DISTRICT COURT OF APPEAL OF FLORIDA, FIFTH DISTRICT PETITIONER S BRIEF ON JURISDICTION PAUL MORRIS Law Offices of Paul Morris, P.A S. Dixie Highway Suite 1450 Miami, FL (305) Florida Bar No paulappeal@aol.com paulappeal@gmail.com Counsel for Petitioner

2 TABLE OF CONTENTS TABLE OF CITATIONS ii- STATEMENT OF THE CASE AND FACTS SUMMARY OF ARGUMENTS ARGUMENTS I. THE DECISION OF THE FIFTH DISTRICT IS IN EXPRESS AND DIRECT CONFLICT WITH MCKENZIE CHECK ADVANCE OF FLA., LLC v. BETTS, 112 So. 3d 1176 (Fla. 2013) AND FLYER PRINTING CO. v. HILL, 805 So. 2d 829 (Fla. 2d DCA 2001) ON THE SAME QUESTIONS OF LAW II. THE DECISION OF THE FIFTH DISTRICT IS IN EXPRESS AND DIRECT CONFLICT WITH SHOTTS v. OP WINTER HAVEN, INC., 86 So. 3d 456 (Fla.2011), GESSA v. MANOR CARE OF FLA., INC., 86 So. 3d 484 (Fla.2011), MAZZONI FARMS INC. v. E.I. DUPONT DE NEMOURS & CO., 761 So. 2d 306 (Fla. 2000), MINTZ & FRAADE, P.C. v. BETA DRYWALL ACQUISITION, LLC, 59 So. 3d 1173 (Fla. 4th DCA 2011), AND DEFAULT PROOF CREDIT CARD SYS., INC. v. FRIEDLAND, 992 So. 2d 442 (Fla. 3d DCA 2008) ON THE SAME QUESTIONS OF LAW CONCLUSION CERTIFICATE OF SERVICE APPENDIX (App. 1-7) CERTIFICATE OF COMPLIANCE i-

3 TABLE OF CITATIONS Cases Default Proof Credit Card Sys., Inc. v. Friedland, 992 So. 2d 442 (Fla. 3d DCA 2008) , -7-, -8-, -9- Flyer Printing Co., Inc. v. Hill, 805 So. 2d 829 (Fla. 2d DCA 2001) , -4-, -5-, -6-, -7- Gessa v. Manor Care of Fla., Inc., 86 So. 3d 484 (Fla. 2011) , -7-, -9- Local No. 234 of United Ass n of Journeymen v. Henley & Beckwith, Inc., 66 So. 2d 818 (Fla.1953) Mazzoni Farms Inc. v. E.I. DuPont De Nemours & Co., 761 So. 2d 306 (Fla. 2000) , -7-, -8-, -9- McKenzie Check Advance of Fla., LLC v. Betts, 112 So. 3d 1176 (Fla. 2013) , -5-, -6-, -7- Mintz & Fraade, P.C. v. Beta Drywall Acquisition, LLC, 59 So. 3d 1173 (Fla. 4th DCA 2011) , -7-, -8-, -9- Pilot Catastrophe Servs., Inc. v. Fouche, 145 So. 3d 151 (Fla. 5th DCA 2014) passim Shotts v. OP Winter Haven Inc., 86 So. 3d 456 (Fla. 2011) , -7-, -9- -ii-

4 Other Authorities 42 U.S.C. 2000e-2 (2012) U.S.C (2012) Fla. Const. Art. V, 3(b)(3) Section , Fla. Stat. (2012) iii-

5 STATEMENT OF THE CASE AND FACTS The petitioner, Suzanne Fouche ( Fouche ), seeks review of the decision of the District Court of Appeal of Florida, Fifth District, in Pilot Catastrophe Servs., Inc. v. Fouche, 145 So. 3d 151 (Fla. 5th DCA 2014) (App. 1-7) based upon express and direct conflict with decisions of this Court and other district courts of appeal on the same questions of law. See Fla. Const. Art. V, 3(b)(3). The following relevant facts are from the decision of the Fifth District. Fouche, a Florida resident, filed a lawsuit against her former employer, Pilot Catastrophe Servs., Inc. ( Pilot ), claiming disability and gender discrimination in her employment in violation of the Americans with Disabilities Act (Title VII), see 42 U.S.C (2012), the Florida Civil Rights Act, see , Fla. Stat. (2012), and the Civil Rights Act of 1964, see 42 U.S.C. 2000e-2 (2012). (App. 2). Pilot moved to compel arbitration based upon the parties employment contract. The contract included a choice of law provision that the contract would be governed by Alabama law (where Pilot is incorporated). The contract also included an arbitration provision that all disputes between the parties would be resolved through binding arbitration. (App. 2). The arbitration provision also mandated that: Fouche would bear the expense of her arbitration panel designee, Pilot would pay for its panel designee, and Fouche and Pilot would equally divide the expense of the umpire and the -1-

6 arbitration; Fouche and Pilot would bear their own attorney s fees, costs, and expenses; punitive damages were not awardable, but if an agreement precluding such damages was unenforceable, then the award would be limited to 10% of any proven recoverable actual compensatory damages; and if allowed, punitive damages would only be awardable upon proof beyond a reasonable doubt. (App. 2). The trial court denied Pilot s motion to compel arbitration, ruling that the arbitration provision defeated Fouche s rights under the statutes sued upon and was therefore unenforceable. (App. 4). Pilot appealed to the Fifth District which reversed and remanded with instructions to submit the case to arbitration. (App. 7). The trial court found that the arbitration agreement was unenforceable because it improperly precluded the recovery of attorney fees in the arbitration in conflict with the statutes sued upon. The Fifth District reversed, holding that the trial court s finding was mooted by Pilot s concession that attorney fees can be awarded in the arbitration. (App. 7 at n.7). With regard to the arbitration provision prohibiting or limiting recovery by Fouche of punitive damages, the Fifth District acknowledged the following: Title VII and the Civil Rights Act do not place a cap on the recovery of punitive damages, nor do they place the burden of proving punitive damages beyond a reasonable doubt on the claimant. The principles that make a contract clause prohibiting the recovery of punitive damages unenforceable are equally applicable to contract clauses that limit punitive damages. Accordingly, these contract provisions are -2-

7 unenforceable. (App. 6). Nevertheless, the Fifth District upheld the agreement by applying Alabama law and holding that because Alabama law favors the severability of such a punitive damages clause, the agreement was enforceable by severing the punitive damages restrictions. (App. 5-6). SUMMARY OF ARGUMENTS I: In McKenzie Check Advance of Fla., LLC v. Betts, 112 So. 3d 1176 (Fla. 2013), this Court held a contractual provision that defeats the purpose of a remedial statute violates public policy and is therefore unenforceable. The Second District reached the same holding in Flyer Printing Co., Inc. v. Hill, 805 So. 2d 829 (Fla. 2d DCA 2001). Here, the arbitration agreement requires the parties to equally bear attorney s fees and the costs of arbitration, thereby rendering the agreement unenforceable as defeating Fouche s rights under both Title VII and the Florida Civil Rights Act to seek recovery of all her attorney s fees and costs. In direct and express conflict with McKenzie and Flyer Printing, the Fifth District upheld the agreement. The Fifth District approved the agreement despite its invalid attorney s fees and costs provision based solely upon Pilot s unilateral consent to an award of attorney s fees in the arbitration. The employer in Flyer Printing attempted to save the agreement in that case in the same way. However, the Second District in Flyer -3-

8 Printing held that the courts cannot re-make an unenforceable fees and costs provision of an arbitration agreement and that an employer does not have the authority to bind the employee to a material change in the contract in an attempt to save the otherwise unenforceable agreement. The decision of the Fifth District is in direct and express conflict with Flyer Printing on this identical question of law as well. II: The Fifth District rendered a decision that also expressly and directly conflicts with Gessa v. Manor Care of Fla., Inc., 86 So. 3d 484 (Fla. 2011) and Shotts v. OP Winter Haven Inc., 86 So. 3d 456 (Fla. 2011) by failing to apply the standards promulgated by this Court in those decisions for determining whether a punitive damages restriction in an arbitration provision that violates Florida s strong public policy can be severed to save the agreement from unenforceability. The Fifth District s decision also conflicts with Mazzoni Farms Inc. v. E.I. DuPont De Nemours & Co., 761 So. 2d 306 (Fla. 2000), Mintz & Fraade, P.C. v. Beta Drywall Acquisition, LLC, 59 So. 3d 1173 (Fla. 4th DCA 2011), and Default Proof Credit Card Sys., Inc. v. Friedland, 992 So. 2d 442 (Fla. 3d DCA 2008), having failed to first determine, before applying Alabama law, whether the agreement s choice of law provision in the employment agreement was invalid because the law of Alabama contravenes the strong public policy of the law of Florida. -4-

9 ARGUMENTS I. THE DECISION OF THE FIFTH DISTRICT IS IN EXPRESS AND DIRECT CONFLICT WITH MCKENZIE CHECK ADVANCE OF FLA., LLC V. BETTS, 112 So. 3d 1176 (Fla. 2013) AND FLYER PRINTING CO. v. HILL, 805 So. 2d 829 (Fla. 2d DCA 2001). Under Florida law, a contractual provision that defeats the purpose of a remedial statute violates public policy and is thus unenforceable. McKenzie Check Advance of Fla., LLC v. Betts, 112 So. 3d 1176, 1183 (Fla. 2013); see also Flyer Printing Co., Inc. v. Hill, 805 So. 2d 829, 830 (Fla. 2d DCA 2001) (same). The arbitration agreement in this case requires the parties to bear equally attorney s fees and costs for arbitration. Consequently, the agreement is unenforceable as defeating Fouche s rights under both Title VII and the Florida Civil Rights Act to seek recovery of all her attorney s fees and costs. But in express and direct conflict with McKenzie and Flyer Printing, the Fifth District held that agreement was enforceable. Pilot attempted to save the arbitration agreement by offering a concession that Fouche could recover attorney s fees in the arbitration. The Fifth District held that Pilot s concession saved the agreement by having mooted Fouche s claim that agreement was rendered unenforceable by precluding the recovery of attorney s fees. (App. 7 at n.7). The employer in Flyer Printing offered the same concession in an attempt to save the arbitration agreement in that case. But the Second District reached -5-

10 a holding expressly and directly in conflict with the Fifth District in the case at bar. In Flyer Printing, employee Hill sued her employer, Flyer Printing, for employment discrimination under Title VII of the Civil Rights Act and the Florida Civil Rights Act. Flyer Printing moved to compel arbitration based upon an agreement for binding arbitration Hill signed when she first began working at the company. The agreement required Hill to pay half the attorney s fees and half the costs of arbitration. The trial court refused to enforce the arbitration agreement and denied Flyer Printing s motion to compel arbitration. On appeal by Flyer Printing, the Second District affirmed, holding in pertinent part as follows: [P]arties may agree to arbitrate statutory claims, including claims under Title VII, so long as the agreement furnishes an adequate mechanism for vindicating the claimant s statutory rights. [citation omitted]. On the other hand, when an arbitration agreement contains provisions that defeat the remedial purpose of the statute, the agreement is not enforceable. *** [W]e approve the circuit court s refusal to enforce the parties arbitration agreement because it required Hill to bear half the fees and costs associated with the arbitration. In so doing, the agreement contravened Hill s statutory rights to seek a full award of her fees and costs under Title VII and the Florida Civil Rights Act, thus defeating the remedial purposes of those statutes. Flyer Printing, 805 So. 2d at 831. The Second District went on to reject Flyer Printing s attempt to save the -6-

11 arbitration agreement by offering to pay all the costs of arbitration notwithstanding the language of the agreement. Hill rejected that unilateral offer and the Second District held: [W]e are not authorized to remake the parties agreement. Id. at 832. In direct and express conflict with Flyer Printing, the Fifth District upheld the fee and cost splitting provision based solely upon Pilot s unilateral offer to remake the provision in an attempt to save the agreement from unenforceability. II. THE DECISION OF THE FIFTH DISTRICT IS IN EXPRESS AND DIRECT CONFLICT WITH SHOTTS v. OP WINTER HAVEN, INC., 86 So. 3d 456 (Fla. 2011), GESSA v. MANOR CARE OF FLA., INC., 86 So. 3d 484 (Fla. 2011), MAZZONI FARMS INC. v. E.I. DUPONT DE NEMOURS & CO., 761 So. 2d 306 (Fla. 2000), MINTZ & FRAADE, P.C. v. BETA DRYWALL ACQUISITION, LLC, 59 So. 3d 1173 (Fla. 4th DCA 2011), AND DEFAULT PROOF CREDIT CARD SYS., INC. v. FRIEDLAND, 992 So. 2d 442 (Fla. 3d DCA 2008). The arbitration provision at issue limits recovery by Fouche of punitive damages and requires her to prove punitive damages beyond a reasonable doubt. This Court s decisions in Gessa v. Manor Care of Fla., Inc., 86 So. 3d 484 (Fla. 2011) and Shotts v. OP Winter Haven Inc., 86 So. 3d 456 (Fla. 2011) condemn as unenforceable such limitation-of-remedies provisions that directly undermine specific statutory remedies created by the Legislature... Shotts, 86 So. 3d at 474. The trial court ruled, consistent with Gessa and Shotts, that the arbitration provision was unenforceable as violative of Florida s strong public policy. On appeal by Pilot, the Fifth District acknowledged the factual basis of the trial court s ruling -7-

12 as follows: Title VII and the Civil Rights Act [upon which Fouche sued Pilot] do not place a cap on the recovery of punitive damages, nor do they place the burden of proving punitive damages beyond a reasonable doubt on the claimant. (App. 6). Nevertheless, the Fifth District reversed the trial court by applying Alabama law pursuant to the choice of law provision contained in the arbitration provision without first addressing the validity of the choice of law provision. The Fifth District held that under Alabama law, the invalid punitive damages provision was severable, thereby rendering the agreement enforceable under Alabama law. Generally, Florida enforces choice-of-law provisions unless the law of the chosen forum contravenes strong public policy. Mazzoni Farms Inc. v. E.I. DuPont De Nemours & Co., 761 So. 2d 306, 311 (Fla. 2000); see also Mintz & Fraade, P.C. v. Beta Drywall Acquisition, LLC, 59 So. 3d 1173, 1176 (Fla. 4th DCA 2011) (same); Default Proof Credit Card Systems, Inc. v. Friedland, 992 So. 2d 442, 444 (Fla. 3d DCA 2008) (same). Fouche clearly showed that the law of Alabama contravenes the strong public policy of Florida. Unlike Alabama law, severance of an invalid restriction in an arbitration agreement is not automatic under the law of Florida. In fact, even where an arbitration agreement contains a severability clause, under Florida law, an invalid provision is still not necessarily severable from the remainder of the agreement where the provision goes to the very essence of the agreement. -8-

13 Shotts, 86 So. 3d at 478. Rather, the determination of severability must be made in accordance with Gessa, wherein this Court promulgated a general standard for determining whether a contractual provision is severable from the whole contract as follows: [A] bilateral contract is severable where the illegal portion of the contract does not go to its essence, and where, with the illegal portion eliminated, there still remains of the contract valid legal promises on one side which are wholly supported by valid legal promises on the other. Gessa, 86 So. 3d at 490 (quoting Shotts, 86 So. 3d at 475) (quoting Local No. 234 of United Ass n of Journeymen v. Henley & Beckwith, Inc., 66 So. 2d 818, (Fla.1953)). The decision of the Fifth District expressly and directly conflicts with: Gessa and Shotts by approving the punitive damages restrictions that directly undermine specific statutory remedies, and by failing to apply Florida law to determine whether the restrictions were severable; and Mazzoni, Mintz, and Friedland, by applying the law of a foreign state that contravenes the strong public policy of Florida. -9-

14 CONCLUSION Based upon the foregoing, the petitioner respectfully requests that this Court grant review of the decision of the Fifth District. Respectfully submitted, LAW OFFICES OF PAUL MORRIS, P.A S. Dixie Highway Suite 1450 Miami, FL (305) Florida Bar No s/ Paul Morris PAUL MORRIS Counsel for Petitioner Suzanne Fouche -10-

15 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the foregoing brief of petitioner on jurisdiction was ed and mailed to the following counsel this 24th day of October, 2014: Marc A. Sugerman Counsel for Respondent Allen, Norton & Blue, P.A W. Fairbanks Ave., Suite 100 Winter Park, FL Tel Fax msugerman@anblaw.com s/ Paul Morris CERTIFICATE OF COMPLIANCE This brief complies with the font requirements of Fla. R. App. P s/ Paul Morris -11-

16 IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA FIFTH DISTRICT PILOT CATASTROPHE SERVICES, INC., NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED Appellant, v. Case No. 5D SUZANNE FOUCHE, Appellee. / Opinion filed June 20, 2014 Non Final Appeal from the Circuit Court for Seminole County, Alan A. Dickey, Judge. Marc A. Sugerman, of Allen, Norton & Blue, P.A., Winter Park, for Appellant. Daniel N. Brodersen, of Brodersen Law Firm, Orlando, for Appellee. PALMER, J. Pilot Catastrophe Services, Inc., appeals the non-final order entered by the trial court denying its motion to compel arbitration. 1 Determining that the arbitration agreement involved in this case is enforceable in part, we reverse. 1 This court has jurisdiction. See Fla. R. App. P (a)(3)(C)(iv). App. 001

17 Suzanne Fouche, a Florida resident, filed a lawsuit against Pilot, claiming disability and gender discrimination in her employment, in violation of the Americans with Disabilities Act (Title VII), 2 the Florida Civil Rights Act (FCRA), 3 and the Civil Rights Act of Pilot filed a motion to compel arbitration and to dismiss or stay Fouche's lawsuit based upon the parties' employment contract. That contract included a choice of law provision mandating that the contract would be governed by Alabama law (where Pilot is incorporated). The employment contract also contained an arbitration provision, providing that all disputes between the parties would be resolved through binding arbitration. The arbitration provision also included, in relevant part, the following language: Pilot will bear the expense of its panel designee, the Employee will bear the expense of the Employee's panel designee, and Pilot and the Employee will bear the equally bear the expense of the umpire and the arbitration... The Employee and Pilot shall each bear their own attorney's fees, costs, and expenses. The Employee and Pilot expressly agree that punitive and/or exemplary damages shall not be awarded; however, if an agreement precluding such damages or award is unenforceable, then, in such event, Employee and Pilot agree that such award shall be limited to a maximum of 10% of any proven recoverable actual compensatory damages.... Employee and Pilot further agree that that punitive and/or exemplary damages, if allowed and recoverable, shall only be awarded only upon a showing of proof beyond a reasonable doubt of conduct permitting recovery of such damages. 2 See 42 U.S.C (2012). 3 See , Fla. Stat. (2012). 4 See 42 U.S.C. 2000e-2 (2012). 2 App. 002

18 After conducting a hearing, the trial court denied Pilot's motion to compel arbitration, concluding that the arbitration provision was unenforceable. Pilot contends that the trial court erred in denying its motion to compel arbitration, arguing that the arbitration provision is valid and enforceable under the Federal Arbitration Act and Alabama law. We agree, in part. Orders denying motions to compel arbitration are reviewed de novo, except that factual findings are reviewed for support by competent, substantial evidence. Furthermore, a trial court's decision regarding whether an arbitration agreement or provision is void as against public policy presents a pure question of law, subject to de novo review. Fi-Evergreen Woods v. Estate of Vrastil, 118 So. 3d 859, 862 (Fla. 5th DCA 2013) (quoting Shotts v. OP Winter Haven, Inc., 86 So. 3d 456, 471 (Fla. 2011)). As a threshold procedural matter, the Federal Arbitration Act (FAA) 5 applies to agreements evidencing a transaction involving interstate commerce. See Acton CATV, Inc. v. Wildwood Partners, Ltd., 508 So. 2d 1274 (Fla. 5th DCA 1987); Williams v. Hardy, 468 So. 2d 429 (Fla. 5th DCA 1985); Donmoor, Inc. v. Sturtevant, 449 So. 2d 869, 870 (Fla. 5th DCA 1984). A contract between a Florida resident and a foreign corporation is an agreement evidencing a transaction involving interstate commerce. See Gilman & Ciocig, Inc. v. Wetherald, 855 So. 2d 900, , (Fla. 4th DCA 2004). The United States Supreme Court has explained that the purpose of the FAA is to "reverse the longstanding judicial hostility to arbitration agreements... and to place arbitration agreements upon the same footing as other contracts." Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79 (2000) (citations omitted). Consistent with that objective, the 5 See 9 U.S.C (2012). 3 App. 003

19 FAA creates a strong federal policy in favor of arbitration. See Picard v. Credit Solutions, Inc., 564 F.3d 1359, 1367 (11th Cir. 2005). Section two of the FAA provides: A written provision... [in a]contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. 9 U.S.C. 2 (2012). Under Alabama law, "[a]rbitration provisions are to be treated like any other contractual provision," and a trial court is "required to stay or dismiss proceedings and to compel arbitration if the parties have entered into a valid contract containing an arbitration agreement." Service Corp. Int'l v. Fulmer, 883 So. 2d 621, 633 n.15 (Ala. 2003); Ameriquest Mortg. Co., Inc. v. Bentley, 851 So. 2d 458, 462 (Ala. 2002). The trial court held that the arbitration provision contained in the parties' employment contract was unenforceable for two reasons: (1) Fouche received inadequate consideration, and (2) the arbitration provision amends federal law. As to the first issue, the trial court ruled the following: [T]his Court finds that because [Fouche's] employment was at-will, if this arbitration agreement provision is enforced, [Fouche] would have forfeited her rights to access the courts without having received any meaningful compensation. In other words, the effect of this arbitration clause is to amend Title VII, the Florida Civil Rights Act, and the Americans with Disabilities Act, to limit the Plaintiff's access to courts, for which she received no consideration other than at-will employment (which is effectively nothing). The trial court erred in determining that at-will employment is not adequate consideration to enforce Fouche's agreement to arbitrate because the Alabama Supreme Court has consistently held that "at-will employment is sufficient consideration to make 4 App. 004

20 an employee's promise to arbitrate binding." Bentley, 851 So. 2d at 464 (citing Gadsen Budweiser Distrib. Co. v. Holland, 807 So. 2d 528, 531 (Ala. 2001)); Ex Parte McNaughton, 728 So. 2d 592, 595 (Ala. 1998)). As to the second issue, the trial court's ruling presents two separate issues under Alabama law: (1) whether the punitive damages clause is unenforceable and, if so, whether it can be severed from the parties' employment contract, and (2) whether the arbitration provision is rendered unenforceable because it forces Fouche to split the costs of arbitration and to bear her own attorney's fees and costs. First, under Alabama law, a contractual provision that prohibits punitive damages violates public policy and is, therefore, unenforceable because it prevents a party from recovering a complete remedy provided for by law. See Ex Parte Thicklin, 824 So. 2d 723, (Ala. 2002)(citing Cavalier Mfg., Inc. v. Jackson, 823 So. 2d 1237 (Ala. 2001)). However, Alabama law favors the severability of offending punitive damages clauses. In Ex Parte Thicklin, the Alabama Supreme Court concluded that a provision in an arbitration agreement prohibiting punitive damages was invalid, but severed it out, sending the case to arbitration. Id. at 735. In Ex Parte Celtic Life Insurance Co., 834 So. 2d 766 (Ala. 2002), the court explained that trial courts have a duty "to preserve so much of a contract as may properly survive its invalid and ineffective provisions." Id. at 769. Ex Parte Celtic involved an arbitration provision that prohibited the recovery of punitive damages. The Court severed the invalid provision and then sent the case to arbitration. Id. In the instant case, the arbitration provision prohibits the recovery of punitive damages, and further provides that, "if an agreement precluding such damages or award 5 App. 005

21 is unenforceable, then... Employee and Pilot agree that such award shall be limited to a maximum of 10% of any proven recoverable actual compensatory damages." Title VII and the Civil Rights Act do not place a cap on the recovery of punitive damages, nor do they place the burden of proving punitive damages beyond a reasonable doubt on the claimant. The principles that make a contract clause prohibiting the recovery of punitive damages unenforceable are equally applicable to contract clauses that limit punitive damages. Accordingly, these contract provisions are unenforceable. In light of Alabama law favoring severability, as well as the FAA's requirement that arbitration agreements be treated no less favorably than other contracts under state law, the trial court should have severed the punitive damages clause from the arbitration agreement. Second, the United States Supreme Court has held that, "where... a party seeks to invalidate an arbitration agreement on the ground that arbitration would be prohibitively expensive, that party bears the burden of showing the likelihood of incurring such costs." Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79, 92 (2000). In that case, Randolph provided the Court with evidence of costs from "informational material from the American Arbitration Association" and from "cases involving other arbitrations as reflected in the opinions of other Courts of Appeals." Id. The Court held that "[n]one of this information affords a sufficient basis for concluding that Randolph would in fact have incurred substantial costs in the event her claim went to arbitration." Id. In a footnote, the Court found that Randolph supported her assertion that arbitration costs were prohibitively expensive with "unfounded assumptions." Id. at 97, n.6. In the instant case, Fouche submitted an affidavit to the trial court, indicating "that she is single and the sole supporter of herself" and that "she could no longer afford the 6 App. 006

22 substantial expense of arbitration mandated under the Agreement." She cited to a law review article and a New York Times article, both of which discuss the potentially high costs of arbitration when compared to the costs of litigation in court, asserting that arbitration costs would be higher than court filing fees. This evidence is less than what the claimant in Randolph provided, which the U.S. Supreme Court determined was "too speculative." As such, Fouche has not met her burden of demonstrating that her arbitration costs would be prohibitively high; therefore, the trial court erred in denying Pilot's motion to compel arbitration. 6 Accordingly, we reverse the trial court's order denying Pilot's motion to compel arbitration and remand with instructions to sever the punitive damages clause and submit the case to arbitration. 7 REVERSED and REMANDED. COHEN and WALLIS, JJ., concur. 6 Importantly, Fouche is not left without a remedy. She can seek judicial review of the cost-splitting provision when her arbitration expenses become a certainty. The dissent in Randolph, arguing against the majority on the basis of judicial economy, comes to the same conclusion. "The Court's opinion, if I comprehend it correctly, does not prevent Randolph from returning to court... if she then has a complaint about cost allocation." Randolph, 531 U.S. at Fouche's contention that the arbitration agreement is unenforceable because it precludes the recovery of attorney fees in the arbitration is mooted by Pilot's concession that attorney fees can be awarded in the arbitration. 7 App. 007