UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

JANET PAYNE, 

 Plaintiff, 

 

v. 

 

MENARD, INC., d/b/a MENARD, 

 Defendant. 

 Case No.: 2:15-CV-317-JVB-PRC 

OPINION AND ORDER

 Plaintiff Payne sued Defendant Menard pursuant to the Americans with Disabilities Act 

and the Age Discrimination in Employment Act. Payne also brought a claim for worker’s 

compensation retaliation under Indiana law.1

 Menard moved to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(3) on the 

ground that, by signing an “EMPLOYEE AGREEMENT” when she started working at 

Menard’s, Payne agreed to a mandatory arbitration clause. 

Plaintiff moved for a stay, arguing that the charge she filed against Menard with the 

National Labor Relations Board on January 6, 2016—in which she complains about the 

arbitration agreement—may lead the NLRB to rescind the arbitration agreement, which would 

render the motion to dismiss moot. The Court granted the stay on February 18, 2016. 

 On October 21, 2016, Menard moved to lift the stay given the resolution of the NLRB 

charge. The NLRB did not find the arbitration agreement invalid. The Court lifted the stay on 

October 24, 2016, and now addresses Menard’s motion to dismiss. 

                                                            

1

 The Court reminds Plaintiff of Northern District of Indiana Local Rule 5-4(a)(4), requiring the 

use of at least 12-point type. 
2 

 

A. Summary of Facts 

 The parties do not dispute the following facts. When Menard hired Payne, she signed an 

Employment Agreement. (Mot. Dismiss, DE 6, ¶ 3; Resp. Mot. Dismiss, DE 10 at 2.) 

 This Agreement sets out a process for resolving claims: 

6. Remedy. I agree that all problems, claims, and disputes 

experienced within my work area shall first be resolved as outlined in the 

Team Member Relations section of the Grow With Menards Team Member 

Information Booklet which I have received. If I am unable to resolve the 

dispute by these means, I agree to submit to final and binding arbitration. 

Problems, claims, or disputes subject to binding arbitration include, but are 

not limited to: statutory claims under 42 U.S.C. § 1981, the Age 

Discrimination in Employment Act, Fair Labor Standards Act, Title VII of 

the Civil Rights Act of 1964, Title I of the Civil Rights Act of 1991, 

Americans with Disabilities Act, Family Medical Leave Act, and nonstatutory claims such as contractual claims, quasi-contractual claims, tort 

claims, and any and all causes of action arising under state laws or common 

law. 

These claims shall be resolved by binding arbitration with the 

American Arbitration Association (“AAA”) located at 225 North Michigan 

Avenue, Suite 252, Chicago, Illinois 60601-7601 under its current version 

of the National Rules for the Resolution of Employment Disputes. I 

understand that the AAA National Rules for the Resolution of Employment 

Disputes shall govern the fees in this matter, and that the costs of filing a 

demand for arbitration will not exceed the costs of filing a civil complaint 

in federal court. A copy of the National Rules for the Resolution of 

Employment Disputes and fee schedule of the American Arbitration 

Association may be obtained by contacting it at the address listed above. 

I agree that all arbitrators selected shall be attorneys. This provision 

shall supersede any contrary rule or provision of the forum state. 

Nothing in this Agreement infringes on my ability to file a claim 

or charge of discrimination with the U.S. Equal Employment 

Opportunity Commission or comparable state or local agencies. These 

agencies have the authority to carry out their statutory duties by 

investigating the charge, issuing a determination, filing a lawsuit in 

Federal or state court in their own name, or taking any other action 

authorized under these statutes. I understand that I have the right to 

participate in such action.
3 

Menard, Inc. is engaged in commerce using U.S. Mail and telephone 

service. Therefore, the Agreement is subject to the Federal Arbitration Act, 

U.S.C. Sections 1–14 as amended from time to time. 

(Employee Agreement, DE 7-1, § 6.) 

 At this point, the parties’ claims diverge. Payne claims she suffered injury at work on 

May 28, 2014, when four cases of ceramic tile fell on her shoulder and arm. (Compl., DE 1, ¶ 

13.) Plaintiff asserts claims under the ADA and ADEA, as well as a claim for worker’s 

compensation retaliation under Indiana law. (Compl., DE 1.) 

 Menard argues that the Employee Agreement requires Payne to submit her claims to 

binding arbitration. (Mot. Dismiss, DE 6, ¶ 4.) Accordingly, Menard moved for dismissal 

pursuant to Rule 12(b)(3). 

 Payne’s NLRB charge challenged the arbitration agreement. (DE 12-1 at 3.) But the 

Settlement Agreement regarding that charge provides that Menard’s “arbitration program does 

not violate the Act as it relates to individual claims.” (DE 19-1 at 1.) Following the resolution of 

the NLRB charge and the lifting of the stay, the Court will now evaluate the motion to dismiss 

based on the arbitration clause. 

B. Discussion 

(1) Standard for Evaluating a Motion to Dismiss under Rule 12(b)(3)

 When an arbitration agreement requires arbitration outside the district where the lawsuit 

pends, a Rule 12(b)(3) motion to dismiss for improper venue is the proper procedure. 

Faulkenberg v. CB Tax Franchise Sys., LP, 637 F.3d 801, 808 (7th Cir. 2011) (citing Cont’l Ins. 

Co. v. M/V Orsula, 354 F.3d 603, 606–07 (7th Cir. 2003)). Here, the Agreement calls for 

arbitration in Chicago, outside this Court’s district. (Employee Agreement, DE 7-1, ¶ 6.) 
4 

 When considering a Rule 12(b)(3) motion, the Court must construe the facts in favor of 

the plaintiff. Faulkenberg, 637 F.3d at 806. 

When ruling on a Rule 12(b)(3) motion, the Court may look to evidence outside the 

pleadings. Id. at 809–10. 

(2) Arbitration agreement 

(a) Applicable law 

Arbitration agreements between employers and employees are generally covered by the 

Federal Arbitration Act. 9 U.S.C. §§ 1–16; See Circuit City Store, Inc. v. Adams, 532 U.S. 105, 

118–24 (2001). 

The FAA states that a provision in a contract to settle by arbitration any future 

controversy arising out of the contract or the subject transaction is valid and enforceable, absent 

grounds for revocation: 

A written provision in any maritime transaction or a contract evidencing a 

transaction involving commerce to settle by arbitration a controversy 

thereafter arising out of such contract or transaction, or the refusal to 

perform the whole or any part thereof, or an agreement in writing to submit 

to arbitration an existing controversy arising out of such a contract, 

transaction, or refusal, 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. 

 The FAA is a “congressional declaration of a liberal federal policy favoring arbitration 

agreements . . . .” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983). 

The FAA places arbitration agreements on the same level as other contracts. Gilmer v. 

Interstate/Johnson Lane Corp., 500 U.S. 20, 24 (1991). 
5 

 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 . . . .” Moses H. Cone Mem’l Hosp., 

460 U.S. at 24–25. 

 Statutory claims “may be the subject of an arbitration agreement, enforceable pursuant to 

the FAA.” Gilmer, 500 U.S. at 26. The party resisting arbitration “bears the burden of 

establishing that Congress intended to preclude arbitration of the statutory claims at issue.” 

Green Tree Fin. Corp.-Ala. v. Randolph, 531 U.S. 79, 92 (2000). 

 To determine whether a claim is arbitrable, courts examine: (1) whether the parties 

entered into a valid and enforceable arbitration agreement under applicable state law; (2) whether 

the claims asserted fall within the scope of the arbitration agreement; and (3) whether the moving 

party waived its right to arbitrate. DeGroff v. MascoTech Forming Techs.-Fort Wayne, Inc., 179 

F. Supp. 2d 896, 902 (N.D. Ind. 2001) (citing Gilmer, 500 U.S. at 34); Koveleskie v. SBC Capital 

Mkts., Inc., 167 F.3d 361, 364 (7th Cir. 1999). 

The parties agree that Plaintiff’s claims fall within the scope of the arbitration agreement. 

(Br. Supp. Mot. Dismiss, DE 7 at 6–7; Resp. Mot. Dismiss, DE 10 at 2.) Additionally, Plaintiff 

does not claim Defendant waived its right to arbitrate. Accordingly, the Court will focus on the 

first issue: whether the written agreement is binding under applicable state law. 

 Indiana law requires four elements to form a valid contract: offer, acceptance, 

consideration, and manifestation of mutual assent. In re Paternity of M.F., 938 N.E.2d 1256, 

1259 (Ind. Ct. App. 2010) (citing Ind. B.M.V. v. Ash, Inc., 895 N.E.2d 369 (Ind. Ct. App. 2008)). 

The written agreement satisfies these elements. 
6 

(b) The arbitration agreement is sufficiently clear under Indiana law 

 Plaintiff claims the arbitration agreement is not a valid, enforceable contract under 

Indiana law “because it does not expressly state the rights given up, it is silent as to costs, and it 

provides misinformation.” (Resp. Mot. Dismiss, DE 10 at 2, emphasis removed.) Plaintiff 

complains that the arbitration agreement lacks clarity and does not expressly state that the 

employee gives up her right to court proceedings or jury trial. (Id. at 3.) 

 This Court disagrees. The Agreement might not be a paragon of clarity, but it is clear 

enough. It is far from being so incomprehensible as to be unenforceable. 

After invoking the principle of subsidiarity—that people should resolve issues at the 

smallest, most local level possible—the Agreement’s plain language mandates arbitration: 

I agree that all problems, claims, and disputes experienced within my work 

area shall first be resolved as outlined in the Team Member Relations 

section of the Grow With Menards Team Member Information Booklet 

which I have received. If I am unable to resolve the dispute by these means, 

I agree to submit to final and binding arbitration. 

(Employee Agreement, DE 7-1, § 6.) By signing the Agreement, Plaintiff agreed that if she 

failed to resolve any dispute through the procedures outlined in the Information Booklet—which 

is not part of the record, but which Plaintiff does not claim permit litigation before this Court—

then she would submit to final and binding arbitration. (Id.) This requirement is clear. 

 The Agreement identifies the types of claims subject to binding arbitration, and lists by 

name most of the claims in this lawsuit: claims under the ADEA and the ADA. (Id.) The 

Agreement also states that “any and all causes of action arising under state laws or common 

law”—like Plaintiff’s worker’s compensation retaliation claim—are subject to binding 

arbitration. (Id.) 
7 

 If all that is not clear enough, the Agreement states in bold, capital letters, immediately 

above the signature blocks: 

THIS DOCUMENT CONTAINS A BINDING ARBITRATION 

PROVISION WHICH MAY BE ENFORCED BY THE PARTIES. I 

HAVE READ THIS ENTIRE AGREEMENT AND I FULLY 

UNDERSTAND THE LIMITATIONS WHICH IT IMPOSES UPON 

ME, AND I UNDERSTAND THAT THIS AGREEMENT CANNOT 

BE MODIFIED EXCEPT BY THE PRESIDENT OF MENARD, INC. 

(Id.) The binding-arbitration requirement is clear, and Plaintiff’s arguments in this regard fail. 

(c) The arbitration agreement is not impossible or unconscionable

 Plaintiff further claims the arbitration agreement “must fail due to impossibility and 

unconscionability.” (Resp. Mot. Dismiss, DE 10 at 4.) Plaintiff claims “the plain obligations set 

out by the contract cannot be followed.” (Id.) Plaintiff notes that the 225 North Michigan Avenue 

address given in the arbitration agreement for the AAA is wrong. (Id. at 5.) Plaintiff notes that 

the arbitration agreement does not list a website address or telephone number for the AAA. (Id.) 

 At this procedural stage, the Court accepts as true the contention that the address listed 

for the AAA in the Agreement is wrong. Defendant claims the 225 North Michigan Address is 

the AAA’s former address. (Reply Supp. Mot. Dismiss, DE 11 at 6.) However, whether the 

address listed in the Agreement was correct on the day Plaintiff signed it, or whether it was never 

correct due to a typographical error or some other mistake, is immaterial for the following 

reasons. 

First, Plaintiff does not claim she attempted to contact the AAA before filing this federal 

lawsuit, but failed. Plaintiff filed this lawsuit on August 25, 2016. (Compl., DE 1.) Plaintiff 

claims she attempted to contact the AAA by mail several days later, on August 28, 2016, and the 

mail was returned as undeliverable. (Resp. Mot. Dismiss, DE 10 at 5; Envelope, DE 10-3.) 
8 

Second, the arbitration agreement survives slight discrepancies regarding details because 

the arbitration agreement manifests the parties’ basic intent to arbitrate. The Agreement’s plain 

language mandates final and binding arbitration if internal procedures fail. (Employee 

Agreement, DE 7-1, § 6.) The Agreement specifies the name of the arbitration group charged 

with resolution and an address for that group. (Id.) If the address is wrong, the identity of the 

charged arbitration group remains. 

Indeed, the severability clause of the Agreement provides: “I agree that if the scope or 

enforceability of any part of this Agreement is in any way disputed at any time, a court or 

arbitrator may modify and enforce the Agreement to the extent that it believes to be reasonable 

under the circumstances existing at that time.” (Id.) The Court does not hold that formal 

modification of the Agreement is necessary regarding the AAA’s address. But if it were 

necessary, the reasonable modification would be to replace the incorrect AAA address with the 

correct AAA address. 

The ubiquity of the internet, phone books, and public librarians also renders Plaintiff’s 

complaint about the Agreement’s lack of a website address or telephone number for the AAA 

unavailing. Nor does Plaintiff cite any law in support of the proposition that an arbitration clause 

must include the website address or phone number of the arbitration group. 

(d) Arbitration rules 

Plaintiff also faults the Agreement for referencing the “National Rules for the Resolution 

of Employment Disputes” when, at least as of the date Plaintiff filed her Response to Motion to 

Dismiss, a Google search indicated the AAA no longer has rules by that name. (Resp. Mot. 

Dismiss, DE 10 at 5.) Plaintiff claims the Agreement purports to mandate that the parties use 
9 

only these rules, which are now extinct. (Id.) But the Agreement doesn’t require that. Moreover, 

Plaintiff doesn’t claim there is no current version of these rules. In any event, even if there were 

an ambiguity regarding which arbitration rules should apply, this would not render the arbitration 

mandate invalid. The parties could raise any dispute regarding which rules to use with the 

arbitrators, if necessary. 

On April 27, 2006, when Plaintiff and a representative of Defendant signed the 

Agreement, neither could predict the address to which the AAA would apparently later move, 

and neither could anticipate the exact name of the relevant arbitration rules the AAA would later 

adopt regarding employment disputes. The address change and rule update do not render the 

contract impossible to perform, or unconscionable, or otherwise invalid. 

(e) Arbitration costs and fees 

Plaintiff also argues the Agreement is unconscionable because it is silent regarding who 

will bear the costs and fees of arbitration. (Resp. Mot. Dismiss, DE 10 at 9–10.) Plaintiff cites no 

law supporting this argument. And Plaintiff acknowledges that the Agreement is not completely 

silent regarding the costs and fees of arbitration: the Agreement provides that the AAA’s rules 

will govern fees, and that the costs of filing an arbitration demand will not exceed the costs of 

filing a complaint in federal court. (Id. at 10.) 

Even if the Agreement were completely silent regarding the costs and fees of arbitration, 

this fact alone would not render the arbitration mandate unenforceable. In Green Tree Financial 

v. Randolph, the arbitration agreement was silent about the costs and fees of arbitration. Id., 531 

U.S. at 90. The Supreme Court held that fact alone was “plainly insufficient to render [the 

arbitration agreement] unenforceable.” Id. at 91. 
10 

A party seeking to invalidate an arbitration agreement on the ground that arbitration 

would be prohibitively expensive “bears the burden of showing the likelihood of incurring such 

costs.” Id. at 92. Plaintiff has not met that burden. 

One “highly probative” factor is the comparison of arbitration expense to litigation 

expense. James v. McDonald’s Corp., 417 F.3d 672, 680 (7th Cir. 2005). Plaintiff has not 

offered any compelling arguments in this regard. Indeed, the Agreement provides that “the costs 

of filing a demand for arbitration will not exceed the costs of filing a civil complaint in federal 

court.” (Employee Agreement, DE 7-1, § 6.) 

For all these reasons, the Court holds that the arbitration agreement signed by the parties 

is valid and enforceable. 

C. Conclusion 

 The Court GRANTS the motion to dismiss (DE 6). The Court directs the Clerk to close 

this case. 

SO ORDERED on January 17, 2017. 

s/ Joseph S. Van Bokkelen 

JOSEPH S. VAN BOKKELEN 

 UNITED STATES DISTRICT JUDGE