Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_24-cv-00441/USCOURTS-azd-2_24-cv-00441-0/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 42:2000e Job Discrimination (Employment)

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Silas Mills,

Plaintiff,

v. 

ALA Management Services, Inc.,

Defendant.

No. CV-24-00441-PHX-SMB

ORDER 

Plaintiff Silas Mills (“Mills”) was a physical education teacher and basketball coach 

at a charter school operated by Defendant ALA Management Services, Inc. (“ALA”) until 

his termination from the coaching role and subsequent resignation from his teaching role

in 2022. Mills filed this lawsuit against ALA, alleging, among other claims, racial 

discrimination (Doc. 1). ALA moves to compel arbitration for all of Mills’ legal claims 

pursuant to their employment contracts (Doc. 19 (ALA’s Motion to Compel Arbitration)). 

ALA also requests a stay on this action pending completion of arbitration. (Id.) The parties 

have fully briefed the pending Motion (Docs. 21 (Mills’ Response), 22 (ALA’s Reply). 

Having reviewed the parties’ briefs and the applicable law, the Court will grant ALA’s 

Motion in part.

I. FACTUAL BACKGROUND

Mills is an accomplished basketball player with experience playing in college and 

professionally overseas. (Doc. 1 at 3 ¶ 10.) After his playing career ended, Mills began 

teaching physical education and coaching basketball at a community college in Utah. (Id.

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¶ 11.) Then, in late-2020, Mills moved to Arizona to become a teacher and the head coach 

of the varsity basketball team at one of ALA’s charter schools—American Leadership 

Academy, Queen Creek. (Id. ¶ 13.) As part of his employment his with ALA, Mills signed 

three employment agreements (collectively, the “Teaching Agreements”) and two other

agreements for his part-time coaching role (collectively, the “Coaching Agreements”). 

(Doc. 19-1 at 7, 27.) The employment agreement for the 2020–21 school year (the 

“2020–21 Agreement”) provides in relevant part: 

13. Alternative Dispute Resolution. 

13.1 Should any dispute between Employee and Employer arise at any time 

out of any aspect of the employment relationship, including, but not limited 

to, the hiring, terms, conditions, or termination of employment, Employee 

and Employer will confer in good faith in an effort to resolve promptly such 

dispute. 

13.2 In the event that Employer and Employee are unable to resolve 

their dispute, and should either desire to pursue a claim against the other 

party, both Employer and Employee agree that all disputes arising out 

of or related to this Agreement or their employment relationship shall 

be resolved by final and binding Arbitration. The Employee and 

Employer agree that the Arbitration shall be held in the county and state 

where Employee currently works for Employer or most recently worked 

for Employer. The Employee will provide a list of up to five (5) 

arbitration services or individual arbitrators, and Employer will choose 

from those provided options. If an arbitration service is selected, the 

Arbitrator will be selected in accordance with the procedures prescribed 

by that service. The award of the Arbitrator(s) is final and binding and 

may be entered as a judgment in any court of competent jurisdiction.

(Doc. 19-1 at 10 (emphasis in original).) The agreement for the 2021–22 school year (the 

“2021–22 Agreement”) modified this section to read:

13. Alternative Dispute Resolution. With respect to any dispute between 

Employee and Employer that arises from or relates in any way to this 

Agreement (including any alleged breach hereof) of the parties’ employment 

relationship, the Parties shall first meet and attempt in good faith to resolve 

their dispute through direct discussion. This discussion shall take place 

within a reasonable time (but not to exceed six months) after the dispute 

arises. If the dispute is not successfully resolved through this negotiation 

process, the aggrieved party may initiate the arbitration process if the dispute 

involves legal claims. To be clear, arbitration is not available for matters such 

as interdepartmental disputes, personality conflicts, differences of opinion 

over operational or academic decisions, and other types of disagreements that 

do not give rise to legal claims.

13.1 Claims Subject to Arbitration. With the exception of injunction 

proceedings initiated by the Company and any claims Employee might have 

for workers’ compensation or unemployment compensation benefits, all 

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legal claims related to Employee’s employment with the Company, or the 

termination of Employee’s employment with the Company, will be subject 

to final and binding arbitration. Such claims, include, without limitation, 

claims for wages or other compensation, contract claims, tort claims, 

statutory claims, and claims for discrimination, harassment, retaliation, and 

wrongful termination. Employee understands that this provision applies to 

claims Employee might make against the Company, and to claims the 

Company might make against Employee. EMPLOYEE UNDERSTANDS 

THAT THIS MEANS BOTH THE COMPANY AND EMPLOYEE ARE 

WAIVING THEIR RIGHTS TO HAVE THEIR CLAIMS AGAINST ONE 

ANOTHER DECIDED BY A COURT OR A JURY.

13.2 Arbitration Procedures and Fees. The party making the legal claim(s) 

will initiate proceedings through the American Arbitration Association 

(AAA); information about how to do that is readily available on AAA’s 

website (adr.org). The parties will follow AAA’s arbitrator selection process 

and other rules for employment arbitrations unless those rules conflict with 

this Agreement, in which case this Agreement will govern. Employee’s share 

of the arbitration costs (other than fees charged by Employee’s own counsel) 

shall be equivalent to the filing fee for initiating a lawsuit in the United States 

District Court for the District of Arizona unless Employee would be entitled 

to a waiver of such fee, which the arbitrator shall have the discretion to 

determine. Otherwise, all administrative costs of arbitration and the 

arbitrator’s fee shall be paid by the Company. The parties will have all rights 

to conduct discovery and file motions that they would have under the Federal 

Rules of Civil Procedure. The arbitration hearing will be held in the county 

and state in which Employee works or last worked for Employer.

13.3 Arbitrator’s Authority and Decision. The arbitrator, and not any court, 

shall have the exclusive authority to decide all issues of arbitrability, 

including whether this Agreement is enforceable and covers the claims at 

issue. Further, the arbitrator shall have the full authority to grant any party 

any relief such party could recover in a judicial action brought in court, and 

the same broad authority to manage the arbitration proceeding as a district 

court judge would have to manage litigation in federal court. The arbitrator 

will be asked to produce a written decision and award explaining the reasons 

for the arbitrator’s disposition of the legal claims being arbitrated but will not 

be asked to produce findings of fact and conclusions of law. The arbitrator’s 

award shall be final and binding. The prevailing party may seek confirmation 

of the award, and judgment upon the award, in any court of competent 

jurisdiction, and may seek an award of attorneys’ fees and costs incurred in 

connection with such action.

(Id. at 16–17 (emphasis and capitals in original.) The employment agreement for the 

2022–23 school year (the “2022–23 Agreement”) contains the same provisions. (See id.

at 23–24.) The Coaching Agreements do not contain arbitration provisions. (See id.

at 27–28 (2020–21 Season Agreement), 29–30 (2021–22 Season Agreement).)

Mills claims that throughout his employment as the head basketball coach he was 

subjected to various discriminatory acts from senior staff, including suspicious surveillance 

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of his classroom, limiting available coaching tools, impeding planned basketball trips, and 

subjected to discriminatory animus from parents, in which ALA failed to adequately 

respond after he complained. (Id. at 4–8.) In January 2022, ALA removed Mills from the 

head coach position. (Id.) Plaintiff contends that he only accepted the teaching position 

because of his desire to coach, and after his removal from the role, he felt compelled to 

resign for the 2022–23 school year. (Id.) 

Mills’ lawsuit followed, alleging claims of unlawful racial discrimination under 

Title VII of the Civil Rights Act of 1964, racial discrimination under the Arizona Civil 

Rights Act (“ACRA”), retaliation, hostile work environment, constructive discharge, and 

intentional infliction of emotional distress. (Doc. 1.) ALA now seeks to compel arbitration 

on the basis that the arbitration provisions in the Teaching Agreements provided for 

mandatory arbitration for all legal claims related to Mills’ employment, including those 

related to his coaching role. (Doc. 19 at 1.) Mills disagrees, arguing all claims except for 

the constructive discharge cause of action arise out of his role as a coach, not as a teacher, 

and otherwise, the arbitrations provisions are unenforceable and unconscionable. (Doc. 21

at 1.) 

II. LEGAL STANDARD

The Federal Arbitration Act (“FAA”) governs arbitration agreements in any contract 

affecting interstate commerce. See Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 119, 

(2001).1 The FAA “reflect[s] both a ‘liberal federal policy favoring arbitration’ and ‘the 

fundamental principle that arbitration is a matter of contract.’” AT&T Mobility LLC v. 

Concepcion, 563 U.S. 333, 339 (2011) (internal citations omitted). District courts apply 

state law principles governing the formation of contracts to determine whether a valid 

arbitration agreement exists. First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 944 

(1995). Under the FAA, “agreements to arbitrate [may] be invalidated by generally 

applicable contract defenses, such as fraud, duress, or unconscionability, but not by 

1 Mills does not dispute the interstate nature of the contractual relationship between the 

parties. (Doc. 21.) Accordingly, and because Mills moved from Utah to Arizona for the 

teaching and coaching positions, the Court finds the agreements at issue affect interstate 

commerce. See 9 U.S.C. § 2.

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defenses that apply only to arbitration or that derive their meaning from the fact that an 

agreement to arbitrate is at issue.” Lim v. TForce Logistics, LLC, 8 F.4th 992, 999 (9th 

Cir. 2021) (citation and internal quotations marks omitted). “Arbitration is ‘a way to 

resolve those [contract] disputes—but only those disputes—that the parties have agreed to 

submit to arbitration.’” Coinbase, Inc. v. Suski, 602 U.S. 143, 148 (2024) (quoting First 

Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 943 (1995)). 

“[T]he first question in any arbitration dispute must be: What have these parties 

agreed to?” Id. There are often three separate but interrelated disagreements in cases 

involving a disputed arbitration agreement. See Osterhaus Pharmacy Inc., v. CVS Health 

Corp., No. CV-24-01539-PHX-JJT, 2024 WL 4785818, at *3 (D. Ariz. Nov. 14, 2024). 

As the Supreme Court has explained:

First, [parties] disagree about . . . the merits of the dispute. Second, they 

disagree about whether they agreed to arbitrate the merits. That disagreement 

is about the arbitrability of the dispute. Third, they disagree about who 

should have the primary power to decide the second matter. Does that power 

belong primarily to the arbitrators (because the court reviews their 

arbitrability decision deferentially) or to the court (because the court makes 

up its mind about arbitrability independently)?

First Options, 514 U.S. at 942; see also Coinbase, 602 U.S. at 149 (describing these three 

disputes as layers: “(1) merits, (2) arbitrability, and (3) who decides arbitrability”). The 

second and third type of disagreement are matters of consent. Coinbase, 602 U.S. at 149. 

When a court decides whether parties agreed that arbitrators should decide arbitrability, the 

court “should not assume that the parties agreed to arbitrate arbitrability unless there is 

“clear and unmistakable” evidence that they did so.” First Options, 514 U.S. at 945 

(citation omitted) (cleaned up); see also Lim, 8 F.4th at 1000 (explaining a contractual 

provision delegating the issue of arbitrability to an arbitrator is known as a delegation 

clause or provision). “Even where a delegation clause clearly and unmistakably assigns 

the adjudication of arbitrability to an arbitrator, a party can nevertheless argue that the 

delegation clause itself is unenforceable under the relevant law of contracts.” Osterhaus 

Pharmacy, 2024 WL 4785818, at *3 (citing Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63, 

71 (2010)). If the delegation provision is valid, the arbitrator must resolve all further issues 

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regarding arbitrability—including whether the agreement to arbitrate applies to the dispute 

at issue. Brennan v. Opus Bank, 796 F.3d 1125, 1133 (9th Cir. 2015); see also Henry 

Schein, Inc. v. Archer & White Sales, Inc., 586 U.S. 63, 68–69 (2019) (holding when parties 

“agree to have an arbitrator decide . . . whether their agreement covers a particular 

controversy,” the court “may not decide the arbitrability issue”).

Courts apply the standard governing summary judgment for the resolution of a 

motion to compel arbitration because it is in effect a summary disposition of whether the 

parties had a meeting of the minds to agree to arbitrate. Hansen v. LMB Mortg. Servs.,

Inc., 1 F.4th 667, 670 (9th Cir. 2021).

III. DISCUSSION

The parties’ disputes center on whether Mills’ claims are arbitrable and whether the 

Court or the arbitrator must decide issues of arbitrability. (See Doc. 19 at 7–9; Doc. 21 

at 11–15.) The Court must first decide the threshold issue of whether the arbitrator or the 

Court decides arbitrability. Only then, may the Court reach the issue whether the parties 

agreed to arbitrate the merits of Mills’ claims. 

A. Who Decides Arbitrability?

ALA argues that the AAA arbitrator, as consented to in Section 13.2–3 of the 

2021–22 and 2022–23 Agreements, and not the Court, must decide the threshold issue of 

arbitrability. (Doc. 19 at 7–9.) Mills disagrees and argues the Coaching Agreements do 

not include an arbitration agreement, so nothing precludes the Court from determining the 

arbitrability of his claims related to his coaching role. (Doc. 21 at 4–6, 11–12.)

Where parties have agreed to two contracts, one sending disputes to arbitration and 

the other sending disputes to the courts, a court must decide which contract governs. 

Coinbase, 602 U.S. at 150, 152 (noting otherwise delegation provisions would be 

impermissibly elevated over other forms of contract). To do so, the Court must assess

whether the parties agreed to send the given dispute to arbitration. Id. at 150. Here, the 

dispute is whether the parties agreed to send the issue of who decides the arbitrability of 

the claims to an arbitrator or the courts.

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Under Arizona law, an enforceable contract requires “an offer, acceptance, 

consideration, and sufficient specification of terms so that the obligations involved can be 

ascertained.” Rogus v. Lords, 804 P.2d 133, 135 (Ariz. Ct. App. 1991); see also Hayford 

v. Santander Consumer USA Inc., No. CV-20-01808-PHX-JJT, 2021 WL 3934328, at *3

(D. Ariz. Aug. 11, 2021) (noting the FAA requires an arbitration agreement to be in 

writing). “The fundamental prerequisite to arbitration is the existence of an actual 

agreement or contract to arbitrate.” Escareno v. Kindred Nursing Centers W., L.L.C., 366 

P.3d 1016, 1020 (Ariz. Ct. App. 2016). There is no dispute that the Coaching Agreements

do not contain an arbitration agreement. Instead, ALA attempts to fold Mills’ contractual 

obligations as a coach into the Teaching Agreements to trigger the arbitration clause and 

thereby the delegation of the decision of arbitrability to an arbitrator. On these facts, 

however, ALA has not sufficiently done so through clear and unmistakable evidence. See 

First Options, 514 U.S. at 945.

All three Teaching Agreements contain nearly identical provisions detailing Mills’ 

duties as a teacher. (See Doc. 19-1 at 7–9, 13–15, 20–22.) First, the agreements provide 

that “[d]uring the term of this Agreement, Employee shall provide instruction to the 

School’s students on the courses of study assigned to the School’s authorized 

representatives, perform other duties as indicated below, and perform such other duties as 

customarily performed by one holding Employee’s position in same or similar schools.” 

(Id. at 7, 13, 20.) The agreements then provide various duties. (See id. at 8–9, 14–15, 

21–22.) Mills’ duties included requiring him to teach during working hours, teach an 

approved curriculum, provide tutoring, work afterhours related to professional 

development, club meetings, parent-teacher conferences, and other events designed by the 

school, and various other reporting and communication requirements. (See id.) None of 

these duties, however, encompass his role as the head basketball coach. And notably, the 

Teaching Agreements also separately address pay, benefits, and indicate that they are fully 

integrated written contracts. (Id. at 11, 17, 24.) Despite devoting most of its briefing 

conflating these agreements with the Coaching Agreements, the Coaching Agreements 

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provide for a separate term of employment, pay, duties, and even supervisors. (See id.

at 27–28, 29–30.) It is evident that the parties executed these contracts separately to 

individually govern two varied roles. Put simply, they are independent agreements.

Having found the teaching and coaching contracts are two separate contracts, albeit 

with overlapping time periods, the absence of an arbitration agreement in the Coaching 

Agreements entirely negates any possibility that Mills consented to an arbitrator deciding 

the issue of arbitrability of claims arising out of his coaching role. See Johnson v. Walmart 

Inc., 57 F.4th 677, 682–83 (9th Cir. 2023) (“Where two contracts are ‘separate,’ ‘the lack 

of an arbitration clause means disputes over the agreement are not subject to arbitration.’”

(citation omitted)). On the other hand, the Teaching Agreements include arbitration 

provisions, with the caveat that the 2020–21 provisions did not include a delegation clause. 

The Court’s inquiry then, is to what extent Mills’ claims arise of his coaching role and 

those that pertain to his teaching role.

B. What Claims Arise Out of Mills’ Coaching Role?

As noted, Mills asserts claims of discrimination under Title VII and the ACRA, 

retaliation, hostile work environment, constructive discharge, and intentional infliction of 

emotional distress. ALA proclaims broadly that the Teaching Agreements cover all legal 

claims arising out of Mills’ “employment,” and are otherwise so intertwined that the 

allegations related to coaching are legal claims within the meaning of the Teaching 

Agreements. (Doc. 19; at 11–12; Doc. 22 at 2.) Mills contends that all but the constructive 

discharge claim arise of this employment as a basketball coach. (Doc. 21 at 4.) ALA’s 

argument that the Teaching Agreements providing for arbitration of disputes related to 

Mills’ “employment” does pass muster because, as discussed, the “employment”

referenced in those agreements pertains to the teaching role, not coaching. ALA’s 

argument as to the intertwined factual allegations and legal claims, however, requires 

further analysis.

Mills alleges six factual circumstances giving rise to the claims. (See generally Doc. 

1.) First, Mills alleges that a staff member expressed dreams of becoming the head coach

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and continuously argued with another coach during a game, the staff member began 

surveying Mills’ classroom, Mills reported the staff member’s actions towards the other 

coach to the Dean of Students and the Dean said nothing could be done, the staff member 

was promoted to Athletic Director, the now-Athletic Director gave him literature to 

improve his coaching, and that Mills anticipated that the now-Athletic Director would try 

to get him fired because of his complaints and ambitions to become head coach. (Id. at 4–5 

¶¶ 16–27.) Second, Mills alleges he was the only coach that did not receive access to an 

online film platform. (Id. at 5–6 ¶¶ 28–33.) Third, Mills alleges that following the Athletic 

Director’s resignation, his successor and the director of the school impeded a planned 

basketball trip, but Mills was able to independently fundraise to make the trip happen. (Id.

at 6 ¶¶ 34–39.) Fourth, Mills alleges the new Athletic Director required him to meet with 

a disgruntled parent, in which the parent demeaned him, later that same parent yelled 

profanities at him during a game, and ALA failed to intervene to stop the purported 

harassment. (Id. at 7–8 ¶¶ 40–49.) Fifth, Mills alleges that the director of the school met 

with him and told him that based on his race, Mills could not say certain things to his 

players. (Id. at 7–8 ¶¶ 50–56.) A week later Mills was fired from coaching in the middle 

of the 2021–22 season for not fitting the culture. (Id.) Finally, Mills alleges that the former 

Athletic Director replaced him as the head coach, rather than ALA promoting one of the 

other coaches. (Id. at 8–9 ¶¶ 57–63.) Collectively, these circumstances compelled Mills 

to resign from teaching. (Id.)

Mills seemingly concedes that only his constructive discharge claim arises out of 

his teaching role. However, as alleged, all of the purportedly discriminatory acts 

culminated into Mills’ resignation that form the factual basis for the claim. “[W]hen a 

complaint contains both arbitrable and nonarbitrable claims, the [FAA] requires courts to 

‘compel arbitration of pendent arbitrable claims when one of the parties files a motion to 

compel, even where the result would be the possibly inefficient maintenance of separate 

proceedings in different forums.’” KPMG LLP v. Cocchi, 565 U.S. 18, 22 (2011) (quoting 

Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 214 (1985)). Here, there is no legitimate 

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dispute that the constructive discharge claim is subject to arbitration as it arises out of 

Mills’ teaching role. And ALA has failed to cite authority that the single arbitrable claim 

being intertwined with the remaining claim justifies submitted all claims to arbitration. 

Therefore, the Court now turns to Mills’ enforceability arguments.

C. Are the Arbitration Provisions Enforceable?

Mills argues the arbitration provision in the 2021–22 and 2022–23 Agreements are 

unenforceable for four reasons: (1) the permissive language in Section 13 conflicts with 

the mandatory language in Section 13.1; (2) the term “Company” in Section 13.1 is 

incurably ambiguous; (3) the provisions are procedurally unconscionable; and (4) 

compelling arbitration exceeds the parties’ expectations. (Doc. 21 at 6.) 

As to the first reason, ALA replies by arguing Mills misreads the two provisions, 

and read together, the permissive may permits the aggrieved party to bring a suit to 

arbitration or abandon the claim, then Section 13.1 provides that all legal claims are subject 

to arbitration. (Doc. 22 at 2–3.) The Court agrees with ALA on this issue. To determine 

the parties’ intent under a contract, the Court considers the plain meaning of the words and 

viewed in the context of the entire contract. D.Q.S.A. LLC v. Am. Dairy Queen Corp., 680 

F. Supp. 3d 1113, 1119 (D. Ariz. 2023) (applying Arizona contract law). Viewed in 

context, Section 13 of the 2021–22 and 2022–23 Agreements requires the parties to engage 

in a negotiation process for any dispute arising out of the agreements, only then may the 

aggrieved party initiate the arbitration process for “legal claims,” and does not permit 

arbitration for non-legal claims. (See Doc. 19-1 at 16, 23 (emphasis added).)2 Section 13.1 

then removes various types of legal claims from arbitration, e.g., injunctive relief sought 

by ALA or Mills’ claims for workers compensation or unemployment benefits. (Id. at 16, 

23.) Mills’ manufactured conflict neuters the parties’ agreement to submit the appropriate 

legal claims to arbitration and would render them essentially meaningless. D.Q.S.A. LLC, 

680 F. Supp. 3d at 1119 (“[R]eading of one contract provision must not render a related 

2 The 2020–21 Agreement contains a functionally similar provision (Section 13.1 in that 

agreement), which requires the parties to meet and confer before submitting legal claims 

to arbitration. (See id. at 10.) Therefore, the Court’s analysis on this issue covers all three 

agreements as functionally the same.

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provision meaningless.”). Therefore, the Court refuses to read into the agreements a 

conflict that does not follow the plain meaning read in context.

Regarding the purported ambiguity of “Company,” ALA again argues Mills reads 

the provisions out of context, and otherwise cherry-picks a term to create ambiguity. (Doc. 

22 at 3–4.) And, again, the Court agrees with ALA. Mills attempts to direct the Court’s 

attention to parol evidence of various documents with varying names of ALA entities. (See 

Doc. 21 at 7–8.) Under Arizona law, the Court “first considers the offered evidence and, 

if [it] finds the contract language is ‘reasonably susceptible’ to the interpretation asserted 

by its proponent, the evidence is admissible to determine the meaning intended by the 

parties.” Taylor v. State Farm Mut. Auto. Ins., 854 P.2d 1134, 1140 (Ariz. 1993). But “the 

[Court] need not waste much time if the asserted interpretation is unreasonable[,] or the 

offered evidence is not persuasive.” Id. at 1141. It is true that “Company” is undefined in 

the 2021–22 and 2022–23 Agreements. In context, however, the agreements use the term 

to refer to ALA. For example, in addressing which claims are subject to arbitration, Section 

13 addresses disputes arising out of “the parties’ employment relationship” and Section 

13.1 states “all legal claims related to Employee’s employment with the Company.” (See 

Doc. 19-1 at 16, 23.) ALA is defined as the “Employer,” i.e. the party providing the 

employment opportunity. (See, e.g., id. at 7, 13, 20.) And as a matter of common sense, 

“Company” refers to the “Employer,” which is ALA and includes its management of other 

entities like the schools. Therefore, whether the Court reads the agreements on their own 

or evaluates Mills’ evidence, “Company” is not reasonably susceptible to differing 

interpretations and any purported ambiguity is unreasonable.

Next, turning to unconscionability, Mills’ contention is one of unfairness and he 

expounds that he was hailed into the school’s office to quickly sign the 2021–22 

Agreement, the addition of the delegation clause was not explained to him, and the clause 

was inconspicuous because ALA did not bold the new language. (Doc. 21 at 9–10, 13–14.) 

ALA faults Mills for mischaracterizing the inconspicuousness of the delegation clause, and 

argues that the agreements are not adhesion contracts, that it had no obligation to explain 

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the clause to Mills, as he is not an unsophisticated party, and that he initialed near the new 

language. (Doc. 22 at 6–7.) Although there is a delegation clause shifting determinations 

on issues of arbitrability to an arbitrator, Mills has adequately challenged the enforceability 

of that clause and the Court must first consider the challenge before ordering arbitration on 

arbitrability. See Osterhaus Pharmacy, 2024 WL 4785818, at *4.

Procedural unconscionability addresses the fairness of the bargaining process, 

which “is concerned with ‘unfair surprise,’ fine print clauses, mistakes or ignorance of 

important facts or other things that mean bargaining did not proceed as it should.” Clark 

v. Renaissance W., LLC, 307 P.3d 77, 79 (Ariz. Ct. App. 2013) (quoting Maxwell v. Fidelity 

Financial Services, Inc., 907 P.2d 51, 57–58 (Ariz. 1995)). But mere inequality in 

bargaining power is not sufficient. Graham v. United Servs. Auto. Ass’n, No. 

CV-20-02210-PHX-DWL, 2021 WL 2780865, at *4 (D. Ariz. July 2, 2021). “Even if the 

weaker party does not understand all of the terms included in an agreement, the agreement 

may be enforceable if it is consistent with reasonable expectations and not unduly 

oppressive.” Id. (citation omitted) (“[T]he fundamental question is whether one party to a 

contract has unfairly or surreptitiously deprived the other of the right of access to the 

courts.” (citation omitted)).

First, Mills’ complaints about inconspicuousness of the changes in the 2021–22 

Agreement providing for the delegation clause are without merit. As quoted above, see 

Section I, the 2021–22 Agreement sets out in capital lettering that the parties waive their 

rights to have courts or a jury decide their claims, proceeds to list new procedural rules in 

separately designated and numbered section, and bolds the “Arbitrator’s Authority and 

Decision” followed by the specifics of the delegation. Mills initialed both pages at the 

bottom signifying he independently viewed each page. (Doc. 19-1 at 16–17.) Mills claims 

to have viewed the agreement and that it looked “just like the teaching agreement that [he] 

signed the previous year.” (Doc. 21-1 at 2 ¶ 12.) It is simply not true that the agreements 

looked the same, when the typeface, bolding, numbering, and length all varied. The 

purported surprise seemingly stems from Mills’ failure to actually read what he 

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acknowledged and signed. At bottom, Mills seeks relief from a binding provision in 

contract without making a showing of unconscionability. See, e.g. Nelson v. Rice, 12 P.3d 

238, 243 (Ariz. Ct. App. 2000) (“Courts should not assume an overly paternalistic attitude 

toward the parties to a contract by relieving one or another of them of the consequences of 

what is at worst a bad bargain . . . and in declaring the contract at issue here 

unconscionable.” (cleaned up)). Therefore, the Court declines to find the delegation clause 

unconscionable.

For similar reasons, Mills’ arguments about reasonable expectations also fail. 

Ordinarily, there is a presumption that the terms of a contract are valid and enforceable. 

Harrington v. Pulte Home Corp., 119 P.3d 1044, 1050 (Ariz. Ct. App. 2005). The 

reasonable expectations doctrine may rebut that presumption where one party has reason 

to believe that the assenting party would not do so if he knew the writing contained a 

particular term. Myers v. Racerworld LLC, No. CV-21-01244-PHX-MTL, 2022 WL 

1569080, at *4 (D. Ariz. May 18, 2022). The “‘reason to believe’ may be shown by the 

parties’ prior negotiations or inferred from the fact that the challenged term is bizarre or 

oppressive, eviscerates the non-standard terms explicitly agreed to, or eliminates the 

dominant purpose of the transaction.” Id. (quoting Darner Motor Sales, Inc. v. Universal 

Underwriters Ins., 682 P.2d 388, 397 (Ariz. 1984)). The 2020–21 Agreement included an 

arbitration provision, of which Mills does not take issue with generally, but rather he claims 

the changes in the next two renewal exceeded reasonable expectations. With the benefit 

of hindsight, Mills claims that he would not sign the same contract today and would have 

sought counsel, (Doc. 21 at 2 ¶¶ 14–15), but has provided no reasoning as to why the 

decision on arbitrability falling to an arbitrator or changes in the terms of the arbitration 

provisions played a dominant purpose in his assent to the employment agreement. Nor 

does he make a showing that the terms are oppressive or eviscerates non-standard terms. 

If anything, the changes to the provisions clarify their meaning and further the purpose of 

having an arbitrator decide legal disputes, including those related to arbitrability. Thus, 

Mills’ argument fails.

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D. Should the Court Impose a Stay Pending Arbitration?

The FAA “leaves no place for the exercise of discretion by a district court, but 

instead mandates that district courts shall direct the parties to proceed to arbitration on 

issues as to which an arbitration agreement has been signed.” Dean Witter Reynolds, 470 

U.S. at 218. Accordingly, the FAA “require[s] that if a dispute presents multiple claims, 

some arbitrable and some not, the former must be sent to arbitration even if this will lead 

to piecemeal litigation.” KPMG, 565 U.S. at 19. Where a party requests a stay pending 

arbitration, the FAA directs the Court to enter a stay to litigation after compelling 

arbitration under a valid arbitration agreement. 9 U.S.C. § 3.

Here, ALA requested a stay in this action if Mills pursues employment related legal 

claims through arbitration. (Doc. 19 at 12.) Mills did not address whether a stay was 

appropriate. (Doc. 21.) Having concluded that only the constructive discharge claim arises 

out of the Teaching Agreements subject to the arbitration provision and delegation clause, 

the Court will submit that claim to arbitration. For the remaining claims, however, the 

Court will stay proceedings pending completion of arbitration.

IV. ATTORNEYS’ FEES

ALA requests attorneys’ fees and costs incurred in connection with filing its Motion. 

(Doc. 19 at 12.) The Court declines to award attorneys’ fees and costs at this time.

V. CONCLUSION

Accordingly, 

IT IS ORDERED that Defendant ALA Management Services, Inc.’s Motion to 

Compel Arbitration (Doc. 19) is granted in part.

IT IS FURTHER ORDERED compelling Plaintiff Silas Mills and Defendant 

ALA Management Services, Inc. to arbitration under the terms of the applicable arbitration 

agreement for the constructive discharge claim.

IT IS FURTHER ORDERED staying Plaintiff Silas Mills’ remaining claims 

against Defendant ALA Management Services, Inc. for a limited period of time, to be 

determined by the parties’ progress in engaging in and completing the arbitration process. 

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These parties shall file a joint status report by June 6, 2025, or within one week of a final 

arbitration decision, whichever is sooner.

Dated this 3rd day of December, 2024.

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