1 United States Court of Appeals,

Fifth Circuit.

No. 95-50882.

Summary Calendar.

Camille ROJAS, Plaintiff-Appellant,

v.

TK COMMUNICATIONS, INC., d/b/a KXTN Radio Station and Tichenor

Media Systems, Inc., d/b/a KXTN Radio Station, DefendantsAppellees.

July 11, 1996.

Appeal from the United States Dis trict Court for the Western

District of Texas.

Before WIENER, EMILIO M. GARZA and PARKER, Circuit Judges.

ROBERT M. PARKER, Circuit Judge:

FACTS

In 1991, Ca mille Rojas was employed as a disc jockey by TK

Communications Inc. ("TK"), which o perated KXTN radio station in

San Antonio, Texas. During her tenure at the station, Rojas

alleges that sh e was sexually harassed by her supervisor, Jesse

Arce. Despite her complaints, Rojas alleges that TK never took

corrective action and that Arce and another supervisor retaliated

against her because of her complaints. Rojas resigned from

employment with KXTN on December 22, 1991.

While working at the radio station, Rojas executed an

employment agree ment with her employer. Paragraph 23 of that

agreement provides, in pertinent part, as follows:

23. Arbitration Except for breaches or threatened breaches of

the provisions of Paragraphs 15 through 18 relating to

equitable relief, any action contesting the validity of this1 Tichenor purchased KXTN from TK in June of 1993.

2 Agreement, the e nforcement of its financial terms, or other

disputes shall be sub mitted to arbitration pursuant to the

American Arbitration Association in Ft. Lauderdale,

Florida....

Despite this arbitration clau s e, Rojas commenced this lawsuit

against TK and Tichenor Media Systems, Inc., ("Tichenor"). 1

PROCEEDINGS BELOW

In her original petition, Rojas alleged that she was subjected

to sexual harassment and retaliation by TK for having complained of

the alleged sexual harassment, in violation of Title VII of the

Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.

Rojas joined Tich enor as a defendant under a theory of

successor ship liability. TK and Tichenor filed their answers,

denying Rojas' allegations.

TK then sought to dismiss the action on the ground that Rojas'

claims were subject to the mandatory arbitration clause in her

employment agreement. Tichenor filed a motion for summary judgment

claiming that it had no successor liability in connection with

Rojas' underlying claim.

On October 30, 1995, the district court granted TK's motion to

dismiss and Tichenor's motion for summary judgment. The court

first ruled that Rojas must arbitrate her claims against TK in

accordance with the arbitration clause in her employment agreement.

The court further held that, as a matter of law, Tichenor had no

liability to Rojas as a successor to TK. This appeal followed.

DISCUSSION3

I. Standard of Review

The district court's dismissal of Rojas' claims and grant of

summary judgment are subject to de novo review. B urns-Toole v.

Byrne, 11 F.3d 1270 (5th Cir.1994) (internal citation omitted). A

district court's grant of summary judgment is proper when "there is

no genuine issue as to any material fact" and "the moving party is

entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The

evidence p resented to the trial court is viewed in a light most

favorable to the nonmovant. Hassan v. Lubbock Indep. Sch. Dist.,

55 F.3d 1075, 1078 (5th Cir.1995).

II. Arbitration

The district court concluded that Rojas' Title VII claims were

subject t o compulsory arbitration. Rojas challenges this

conclusion on several grounds. First, she claims that Title VII

claims fall within the Federal Arbitration Act's ("FAA") "contracts

of employment" exclusion. Therefore, she contends she is not

required to arbitrate her claims. In the alternative, she argues

th at even if her claims are not within the FAA's exclusion, the

contract in question contains a narrow arbitration clause which is

inapplicable to her claims. Finally, she contends that the

employment agreement in question is an unconscionable contract of

adhesion and is therefore unenforceable. We address each of these

arguments below.

A. Arbitrability of Title VII Claims

Under th e FAA, "[a] written provision in ... a contract

evidencing a transaction involving commerce to settle by4

arbitration a controversy thereafter arising out of such contract

... shall be valid, irrevocab le, and enforceable, save upon such

grounds as exist at law or in equity for the revocation of any

contract." 9 U.S.C. § 2. None of the parties disputes that Rojas'

contract with TK for employment as a disc jockey is one "involving

commerce" within the meaning of § 2 of the FAA. However, Rojas

contends that her employment contract is excluded from the FAA's

coverage.

Section 1 of the FAA provides, i n pertinent part: "but

nothing herein contained shall apply to contracts of employment of

seamen, railroad employees, or any other class of workers engaged

in foreign or interstate commerce." 9 U.S.C. § 1 e t seq. Arguing

for a broad reading of this section, Rojas contends that because

she is a work er engaged in interstate commerce, the FAA does not

apply to her contract of employment. We disagree.

In 1991, the Supreme Court held that an employee, who agreed

to arbitrate claims arising out of his employment, was required to

arbitrate a claim under the A ge Discrimination in Employment Act

("ADEA"), 29 U.S.C. § 621 et seq., and therefore was barred from a

federal court lawsuit. G ilmer v. Int erstate/Johnson Lane Corp.,

500 U.S. 20, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991). Following

Gilmer this court held that Title VII claims must likewise be

arbitrated. In A lford v. Dean Witter Reynolds, Inc., 939 F.2d 229

(5th Cir.1991), an employee sued under Title VII for discriminatory

discharge . Although the employee was subject to an arbitration

agreement, the district court refused to dismiss the case or to5

com pel arbitration. This court affirmed. However, the Supreme

Court subsequently vacated our affirmance and remanded for further

consideration in light of Gilmer, supra. Relying on G ilmer, we

held that the employee's Title VII claim must be arbitrated:

Because both the ADEA and Title VII are similar civil rights

statutes, and both are enforced by the EEOC

... we have little

trouble concluding that Title VII claims can be subjected to

compulsory arbitration. Any broad public policy arguments

against such a conclusion were necessarily rejected by Gilmer.

939 F.2d a t 230. While the preceding statement would appear to

dispose of the issue presently before the court, we must address a

distinction between the facts of the instant case and those present

in both Gilmer and Alford.

In Gilmer the Supreme Court noted:

[I]t would be inappropriate to address the scope of the § 1

exclusion because the arbitration clause being enforced here

is not contained in a contract of employment. The FAA

requires that the arbitr ation clause being enforced be in

writing. See 9 U.S.C. §§ 2, 3. The record before us does not

show, and the parties do not contend, that Gilmer's employment

agreement with [his employer] contained a written arbitration

clause. Rather, the arbitration clause at issue in Gilmer's

securities registration application, which is a contract with

the securities exchanges, not with [his employer]....

Consequently, we leave for another day the issue [of whether

§ 1 excludes from the FAA all "contracts of employment"].

Gilmer, 500 U.S. at 24 n. 1, 111 S.Ct. at 1651 n. 1.

Similarly, in Alford, a case that a lso dealt with an

arbitration clause contained in a contract between an employee and

a securities exchange rather than an employer, we noted that the

Supreme Court had expressly refused to address the issue now before

the court. S ee Alford, 939 F.2d at 230 n. * (noting that courts

shoul d be mindful of the potential issue presented by the

exclusionary language present in § 1 of the FAA when dealing with2 See Miller Brewing Co. v. Brewery Workers Local Union No.

9, 739 F.2d 1159, 1162 (7th Cir.1984) (§ 1 exclusion is limited

to workers employed in the transportation industries or engaged

in the actual movement of goods in interstate commerce), cert.

denied 469 U.S. 1160, 105 S.Ct. 912, 83 L.Ed.2d 926 (1985);

Erving v. Virginia Squires Basketball Club, 468 F.2d 1064, 1069

(2d Cir.1972) (same); Dickstein v. duPont, 443 F.2d 783, 785

(1st Cir.1971) (same); Tenney Eng'g, Inc. v. United Elec. Radio

& Mach. Workers, 207 F.2d 450, 453 (3d Cir.1953) (same); But see

Willis v. Dean Witter Reynolds, Inc., 948 F.2d 305, 310-11 (6th

Cir.1991) ( dicta ); Pritzker v. Merrill Lynch, Pierce, Fenner &

Smith, Inc., 7 F.3d 1110, 1119-20 (3d Cir.1993).

6 arbitration clauses contained in employment contracts between

employers and employees). Consequently, we must determine the

scope of the exclusionary language present in § 1.

We are not the first to address the scope of the exclusions

present in § 1. In fact, numerous other courts have addressed this

very issue, the majority of whi ch have determined that the

exclusionary language present in § 1 is to be narrowly construed. 2

Particularly persuasive is a recent opinion from the Sixth Circuit.

In Asplundh Tree Expert Co. v. Bates, 71 F.3d 592 (6th

Cir.1995), the court, after a thorough analysis of the treatment of

this issue by its sister circuits, came to the following

conclusion:

[T]he exclusionary clause of § 1 of the Arbitration Act should

be narrowly construed to apply to empl oyment contracts of

seamen, railroad workers, and any other class of workers

actually engaged in the movement of goods i n interstate

commerce in the same way that seamen and railroad workers are.

We believe this interpretation co mports with the actual

language of the statute and the apparent intent of the

Congress which enacted it. The meaning of the phrase "workers

engaged in foreign or interstate commerce" is illustrated by

the context in which it is used, particularly the two specific

examples given, seamen and railroad employees, those being two

classes of em ployees engaged in the movement of goods in

commerce.7

Asplundh, 71 F.3d at 601.

If Congress had intended to exclude all contracts of

employment from FAA coverage, Congress could simply have used

statutory language in § 1 similar to the following: "... but

nothing herein contained shall apply to any contracts of

employment." Congress did not do this. As another court has

noted, "[i]t is q uite impossible to apply a broad meaning to the

term "commerce' in Section 1 and not rob the rest of the exclusion

clause of all significance." A lbert v. National Cash Register Co.,

874 F.Supp. 1324, 1327 (S.D.Fla.1994). We agree with the majority

of other courts which have addressed this issue and conclude that

§ 1 is to be given a narrow reading. Therefore, we find that the

district court was correct when it determined that Rojas'

employment contract was subject to the requirements of the FAA.

B. Applicability of the Arbitration Clause in Question

Next, Rojas argues that even if her claim is not excluded

from the FAA's coverage, her claim is not within the "narrow

language" of the arbitration clause in her contract. The clause at

issue covers "any action contesting the validity of this Agreement,

the enforceme nt of its financial terms, or a ny other disputes. "

(emphasis added).

Whenever the scope of an arbitration clause is in question,

the court should construe the clause in favor of

arbitration.... "The [FAA] establishes that, as a matter of

federal law, any doubts concerning the scope of arbitrable

issues should be resolved in favor of arbitration, whether the

problem at hand is the construction of the contract language

itself or an allegation of waiver, delay or a like defense to

arbitrability."

City of Meridian, Miss. v. Algernon Blair, Inc., 721 F.2d 525, 527-3 In her brief, Rojas contends that her attack on the

Agreement is limited to the arbitration clause. While we

acknowledge that she specifically attacks the arbitration clause,

she also contends that she signed the Agreement "[b]ased upon the

Defendant's representations ... [that the Agreement's] coverage

[would] be limited to situations such as non-competition, payola,

and intellectual property rights." Appellant's Brief at 18. She

also attacks the agreement based upon "inequality of bargaining

power". Id. These assertions belie Rojas' contention that her

attack is limited to the arbitration clause and they support our

conclusion that her attack is directed at the entire agreement.

8 28 (5th Cir.1983) (quoting Moses H. Cone Memorial Hosp. v. Mercury

Constr. Corp., 460 U.S. 1, 24-250, 103 S.Ct. 927, 941-42, 74

L .Ed.2d 765 (1983)). Contrary to Rojas' attempt to characterize

the arbitration clause as "narrow", we conclude that the district

court was correct when it found that "any other disputes" was

sufficiently broad to encompass Rojas' Title VII claims. S ee also

Crawford v. West Jersey Health Sys., 847 F.Supp. 1232, 1243

(D.N.J.199 4) (Title VII claim encompassed by arbitration clause

requiring arbitra tion of " "any dispute ... regard[ing] the

i nterpretation or performance of any part of this Agreement' ");

DiCrisci v. L

yndon Guar. Bank, 807 F.Supp. 947, 950-51

(W.D.N.Y.1992) (Title VII claims encompassed by arbitration clause

requiring arbitration of "any dispute").

C. Unconscionability of Agreement

Rojas' claim that the e mployment agreement is an

unconscionable contract of adhesion is an attack on the formation

of the contract generally, not an attack on the arbitration clause

itself. 3 Because her claim relates to the entire agreement, rather

than just the arbitration clause, the FAA requires that her claims

be heard by an arbitrator. S ee R.M. Perez & Assoc., Inc. v. Welch,4 Finding that we are in agreement with the district court on

this issue, we have adopted, and will simply restate the relevant

portions of the district court's analysis of Tichenor's successor

liability.

9 960 F.2d 534, 538 (5th Cir.1992).

III. Successor Liability 4

Under general contract principles, there is no dispute that

Tichenor did not assume liability on Rojas' claim. Rojas does not

dispute that, in its asse t purchase agreement with TK, Tichenor

expressly excepted Rojas' claim against TK when it assumed certain

pre-transfer obligations of TK.

The liability that Rojas seeks to establish against Tichenor,

however, does not arise from contract. The successorship doctrine

is derived from labor law principles enunciated in four Supreme

Court cases: J ohn Wiley & Sons, Inc. v. Livingston, 376 U.S. 543,

84 S.Ct. 909, 11 L.Ed.2d 898 (1964), NLRB v. Burns International

Security Servs., Inc., 406 U.S. 272, 92 S.Ct. 1571, 32 L.Ed.2d 61

(1972), Howar d Johnson Co. v. Detroit Local Joint Executive Bd.,

417 U.S. 249, 94 S.Ct. 2236, 41 L.Ed.2d 46 (1974), and Fall River

Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 107 S.Ct. 2225, 96

L.Ed.2d 22 (1987). See Southward v. South Cent. Ready Mix Supply

Corp., 7 F.3d 487, 493 (6th Cir.1993).

Wiley held that a successor employer will have a duty to

arbitrate under a preexisting collective bargaining agreement when

there is "substantial continuity" in the business enterprise before

and after a change in ownership. 376 U.S. at 551, 84 S.Ct. at 915.

In Burns, the Court ruled that, even though a successor employer10

may be required to recognize and bargain with a union under the

reasoning in Wiley, it is not bound to the substantive terms of a

preexisting collective bargaining agreement. 406 U.S. at 277-90,

92 S.Ct. at 1576-84. In H oward Johnson, the Court further limited

Wiley by hold ing that a successor employer by way of sale of

assets, as opposed to a merger transaction as in W iley, was no t

bound to arbitrat e a grievance. 417 U.S. at 257-59, 94 S.Ct. at

2240-42. Finally, in F all River Dyeing, the Court reaffirmed Burns

holding that a new employer was free to disregard the terms of its

predecessor's collective bargaining agreement in hiring the

predecessor's employees and that it had no duty to arbitrate unless

there was substantial continuity between the former and latter's

busine ss operations. 482 U.S. at 40, 43-47, 107 S.Ct. at 2234,

2236-38. See generally, Southward, 7 F.3d at 493-96.

Although developed in the context of l abor relations, the

doctrine of successor liability has been extended to claims

asserted under Title VII and related statutes. As one court

explained,

the successor doctrine arises in the context of discrimination

cases in situations where the assets of a defendant employer

are transferred to another entity. Thus, the purpose of the

doctrine is to ensure that an employee's statutory rights are

not "vitiated by the mere fact of a sud den change in the

employer's business." The doctrine allows the aggrieved

employee to enforce against the successor a claim he could

have secure against the predecessor.

Thus, applicability of the doctrine hinges on the need to

protect a plaintiff where the offending entity is substituted

by another company.

Brennan v. Nat'l Tel. Directory Corp., 881 F.Supp. 986, 992

(E.D.Pa.1995) (citations omitted).11

In EEOC v. MacMillan Bloedel Containers, Inc., 503 F.2d 1086,

1094 (6th Cir .1974), the court identified nine factors to be

considered in determining whether successor liability should be

imposed in a discrimination case. These factors are:

(1) whether the successor company had notice of the charge or pending lawsuit prior to acquiring the business or assets of

the predecessor; (2) the ability of the predecessor to

provide relief; (3) whether there has been a substantial

continui ty of business operations; (4) whether the new

employer uses the same plant; (5) whether he uses the same or

substantially the same work force; (6) whether he uses the

same or substantially the same supervisory personnel; (7)

whether the same jobs exist under substantially the same working conditions; (8) whether he uses the same machinery,

equipment, and methods of production; and (9) whether he

produces the same product.

Musikiwamba v. ESSI, Inc., 760 F.2d 740, 750 (7th Cir.1985)

(paraphrasing MacMillan ). This court agrees with M usikiwamba that

the first two factors are critical. I d. The remaining seven

simply "provide a foundation for analyzing the larger question of

whether there is a continuity in operations and the work force of

the successor and predecessor employers," as required by Wiley and

its progeny. I d. at 751; s ee also Bates v. Pacific Maritime

Ass'n, 744 F.2d 705, 709-10 (9th Cir.1984) (three factors governing

successor liability determination are (1) continuity in operations

and workforce, (2) notice of the claim, and (3) ability of

predecessor employer to provide relief); P reyer v. Gulf Tank &

Fabricating Co., 826 F. Supp. 1389, 1395 (N.D.Fla.1993); c f.

Criswell v. Delta Air Lines, Inc., 868 F.2d 1093, 1095 (9th Cir.)

(applying Bates factors in age discrimination case), cert. denied,

489 U.S. 1066, 109 S.Ct. 1342, 103 L.Ed.2d 811 (1989).

The policy underlying the successor doctrine—to pro tect an12

employee when the ownership of his employer suddenly changes—is not

served by imposing liability on Tichenor in this case. Although

Tichenor had notice of Rojas' claim and continued to operate KXTN

in much the same way as TK, TK is still a viable entity. Tichenor

submitted uncontroverted evidence on summary judgment that,

although TK has sold the assets of KXTN, it still operates five

other radio stations, including one in Dallas. Moreover, Rojas

does not seek reinstatement in this action and has, in fact,

rejected Tichenor's offer for reemployment at KXTN under conditions

designed to prevent further harassment. Under these circumstances,

i t would be unjust to impose liability on Tichenor for the mere

purpo se of enhancing Rojas' ability to collect a money judgment.

See Musikiwamba, 760 F.2d at 750-751; B rennan, 881 F.Supp. at 992;

Brown v. Ev ening News Ass'n, 473 F.Supp. 1242 (E.D.Mich.1979).

Compare Bates, 744 F.2d at 710 (fact that predecessor still a

viable entity less relevant where plaintiffs sought classwi d e

relief rather than only monetary and injunctive relief as

individuals). Accordingly, we find that the district court did not

err when it granted Tichenor's motion for summary judgment on the

issue of successor liability.

CONCLUSION

For the foregoing reasons, the judgment of the district court

is AFFIRMED.