Court Opinion

ID: 4045191
Source: CourtListenerOpinion
Date Created: 2016-09-28 23:47:35.018897+00
Date Added: 2024-06-11T14:04:51.664477
License: Public Domain

ACCEPTED
                                                                              13-14-00641-CV
                                                                THIRTEENTH COURT OF APPEALS
                                                                      CORPUS CHRISTI, TEXAS
                                                                         2/13/2015 4:42:42 PM
                                                                            DORIAN RAMIREZ
                                                                                       CLERK

                                                     FILED IN
                         NO. 13-14-00641-CV
 13th COURT OF APPEALS
                                          CORPUS CHRISTI/EDINBURG, TEXAS
                                              2/13/2015 4:42:42 PM
__________________________________________________________________
                                               DORIAN E. RAMIREZ
                                                      Clerk
                   IN THE COURT OF APPEALS

                FOR THE 13th DISTRICT OF TEXAS 

__________________________________________________________________

                        AOF SERVICES, LLC
                                                Appellant
                                  v.

                      RONALD SANTORSOLA
                                       Appellee

     ON APPEAL FROM AN INTERLOCUTORY ORDER OF THE
     2nd 25th DISTRICT COURT OF GONZALES COUNTY, TEXAS
                    TRIAL COURT NO. 25,609-CV

                    BRIEF FOR THE APPELLANT 

                       AOF SERVICES, LLC 

                                Paul C. Allred
                                Texas Bar No. 01102000
                                8150 N. Central Expressway, Suite 700
                                Dallas, TX 75206
                                Tel (214) 448-9496
                                Fax (214) 276-1325
                                paulallred@msn.com

                                Attorney for Appellant
                  (ORAL ARGUMENT REQUESTED)
               IDENTITY OF PARTIES AND COUNSEL

PARTIES

    AOF Services, LLC
    Defendant-Appellant

    Ronald Santorsola
    Plaintiff-Appellee

APPELLANT’S COUNSEL

    Paul C. Allred 

    Texas Bar No. 01102000 

    8150 N. Central Expressway, Suite 700 

    Dallas, TX 75206 

    Tel (214) 448-9496 

    Fax (214) 276-1325 

    paulallred@msn.com 

APPELLEE’S COUNSEL

    Javier Espinoza, 

    The Espinoza Law Firm 

    503. E. Ramsey, Suite 103 

    San Antonio, TX 78216 

    Tel (210) 229-1300 

    Fax (210) 229-1302 

    javier@espinozafirm.com

                                   TABLE OF CONTENTS

IDENTITY OF PARTIES AND COUNSEL ............................................... i

REQUEST FOR ORAL ARGUMENT ....................................................... iii 

CERTIFICATE OF COMPLIANCE .......................................................... iii

TABLE OF AUTHORITIES ........................................................................ iv

STATEMENT OF THE CASE ..................................................................... vi

ISSUES PRESENTED FOR REVIEW ....................................................... vii 

STATEMENT OF FACTS ....................... .................................................... viii

SUMMARY OF THE ARGUMENT ........................................................... 10 

ARGUMENT AND AUTHORITIES .......................................................... 12

CONCLUSION/PRAYER.............................................................................. 26 

CERTIFICATE OF SERVICE ......................................................................27 

APPENDIX…………………………………..……………………….……….28

                     REQUEST FOR ORAL ARGUMENT

      Appellant believes that oral argument is appropriate and will assist the Court

of Appeals in resolving the issues presented in this appeal. Appellant therefore

respectively requests the opportunity to present oral argument in this cause.

                      CERTIFICATE OF COMPLIANCE

      I certify that this document was produced on a computer using Microsoft

Word and contains 4,473 words, as determined by the computer software’s word-

count function, excluding the sections of the document listed in Texas Rule of

Appellate Procedure 9.4(i)(1).

                                               Paul C. Allred

                                         iii
                      TABLE OF AUTHORITIES

CASES                                                      page

In re Jim Walter Homes, Inc. ………………………………………… 12
207 S.W.3d 888, 897 (Tex. App.—Houston
 [14th Dist.] 2000, orig. proceeding)

Jack B. Anglin Co. v. Tipps, …………………………………………. 12 

842 S.W.2d 266, 260 (Tex. 1992) 

(orig. proceeding)

In re Halliburton …………………………………………………………….. 12
80 S.W.3d 566, 572 (Tex. 2002)

Hathaway v. General Mills, Inc. ……………………………………………12
711 S.W.2d 227 (Tex.1986)

In re FirstMerit Bank, N.A. ………………………………………………… 13, 14
52 S.W.3d 749, 756 (Tex. 2001)

ReadyOne Industries, Inc. v. Flores ……………………….……….………13
S.W.3d, No. 08-13-00161-CV, 2014
WL 6982275 (Tex. App.—El Paso Dec. 10, 2014, no pet. h.)

In re Poly-America, L.P. …………………………………………………… 14, 18, 19
262 S.W.3d 337, 355-56 (Tex. 2008) (orig. proceeding)

Pilot Travel Ctrs., LLC v. McCray ………………………………………… 14, 19, 20
416 S.W.3d 168, 180 (Tex. App.—Dallas 2013, no pet.)

Royston, Rayzor, Vickery & Williams, L.L.P. v. Lopez…………….…… 15
2013 Tex. App. LEXIS 7843 at *23
(Tex. App. – Corpus Christi, June 27, 2013)

                                   iv
In re Fleetwood Homes of Texas, L.P……………………………………... 16

257 S.W.3d 692, 695 (Tex. 2008) (per curium)

Green Tree Fin. Corp.—Ala. v. Randolph …………………………..…… 19

531 U.S. 79, 90-91 (2000)

In re Weeks Marine, Inc. …………………………………………………… 20

242 S.W.3d 849, 859 (Tex. App.—Houston 

[14th Dist.] 2007, mand. denied)

STATUTES

Texas Labor Code Section §451 ……………………………………… 8

                               v

                            STATEMENT OF THE CASE 

        The underlying suit brought by Appellee is for wrongful termination from

his employment with AOF Services, LLC (“AOF”).         This interlocutory appeal,

however, relates only to the trial court’s denial of AOF’s Plea in Abatement and

Motion to Compel Arbitration. AOF sought enforcement of a written arbitration

agreement between the parties; Appellee contested the Motion to Compel. After

hearing, the trail court found that the arbitration agreement was unconscionable

and unenforceable and entered an order denying the Motion to Compel.

        AOF appeals the trial court’s interlocutory order denying its Motion to

Compel.

APPELLANT’S BRIEF -Page 6
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                            ISSUES PRESENTED

    1. The trial court erred in holding that the arbitration agreement is
       unconscionable.

    2. The trial court erred in holding that the arbitration agreement is
       unenforceable.

    3. The trial court erred in denying AOF’s Plea in Abatement and Motion to
       Compel Arbitration.

APPELLANT’S BRIEF -Page 7
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                            STATEMENT OF FACTS

        1.   On June 13th, 2013, AOF offered Appellee, Ronald Santorsola

(“Appellee”) employment as a laborer in its oil field services business. (Apx:

Exhibit B p3) As a condition to employment, Appellee agreed to resolve certain

disputes between the parties in arbitration. (See Dispute Resolution Policy, at

Apx: Exhibit B p4)

        2.   After working for AOF for approximately two and a half months,

Appellee allegedly sustained a work related injury and filed suit against AOF

claiming wrongful termination pursuant to Texas Labor Code section 451 (Apx:

Exhibit C at p1).    AOF disputes the alleged work related injury and alleged

wrongful termination.

        3.   AOF filed its Plea in Abatement and Motion To Compel Arbitration

(“the Motion to Compel”) in the wrongful termination suit, seeking enforcement of

the Dispute Resolution Policy (Apx: Exhibit A).    In support thereof, AOF filed

the affidavit of Amit Sharma as a business records affidavit and attached the

Dispute Resolution Policy, more than 14 days before the hearing on Motion to

Compel (Apx: Exhibit B).

        4.   The trial court held a hearing on AOF’s Motion to Compel on May

9th, 2014, before the Honorable W.C. Kirkendall (CR-II: at 1).     On June 16th,

APPELLANT’S BRIEF -Page 8
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2014, Judge Kirkendall advised the parties that he was denying the Motion to

Compel because he found the arbitration agreement unconscionable and

unenforceable (Apx: Exhibit D). On October 20th, 2014 the trial court entered an

order denying the Motion to Compel (CR:III at 13) (Apx: Exhibit E).

APPELLANT’S BRIEF -Page 9
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                             SUMMARY OF THE ARGUMENT 

             Arbitration agreements are favored under Texas law and are presumed to be

    fully enforceable. Appellee agreed to resolve certain disputes between the parties

    through binding arbitration as a condition to his employment with AOF.

    Appellee does not dispute this; nor does he dispute that claims made in Appellee’s

    suit are within the scope of the arbitration agreement. Nevertheless, Appellee

    claims, and the trial court found, that the arbitration agreement is unenforceable.

             Appellee argues that the arbitration agreement is unconscionable, and thus

    unenforceable, for three reasons:

                   a) that it is one sided in favor of the AOF;

                   b) that it unreasonably limits Appellee’s discovery; and

                   c) that it contains a cost sharing and fee splitting agreement.

                                                              (CC:II at p7 line 8)

             The evidence submitted by Appellee, however, does not support the trial

    court’s finding that the arbitration agreement was unconscionable on any of these

    grounds.       Moreover, the unambiguous terms of the arbitration agreement

    conclusively show that the agreement is not one-sided in favor or AOF. Therefore,

    the trial court erred in denying AOF’s Plea in Abatement and Motion to Compel

    Arbitration.

APPELLANT’S BRIEF -Page 10
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             AOF respectively requests this Court to reverse the trial court’s order

    denying AOF’s Plea in Abatement and Motion To Compel Arbitration, and render

    judgment in favor of Appellant compelling arbitration and abating pending suit

    pending resolution of the arbitration proceeding.

APPELLANT’S BRIEF -Page 11
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                             ARGUMENT AND AUTHORITIES
    A. 	     It Is Appellee’s Burden To Prove That The Arbitration Agreement Is
             Unconscionable

             AOF filed its Plea in Abatement and Motion to Compel Arbitration. (Apx:

    Exhibit A). The party moving to compel arbitration has the initial burden of proof

    to establish by summary proof that an agreement to arbitrate exists and to show

    that the claims asserted against it fall within the arbitration agreement’s scope. In

    re Jim Walter Homes, Inc., 207 S.W.3d 888, 897 (Tex. App.—Houston [14th Dist.]

    2000, orig. proceeding) (citing Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 260

    (Tex. 1992) (orig. proceeding)).

             Appellee was an at-will employee of AOF. (Apx: Exhibit B p4)          As a

    condition to Appellee’s employment with AOF, Appellee had to agree to the

    company’s Dispute Resolution Policy, which includes the arbitration agreement at

    issue in this suit. (Apx: Exhibit B p4) The Texas Supreme Court has held that an

    employer may make a “take it or leave it” offer to its at-will employees with

    respect to arbitration of disputes as a condition to employment. In re Halliburton

    Co., 80 S.W.3d 566, 572 (Tex. 2002); Hathaway v. General Mills, Inc., 711
S.W.2d 227 (Tex.1986).

             AOF’s Offer of Employment, to which Appellee undisputedly agreed

    provides, in pertinent part:

APPELLANT’S BRIEF -Page 12
D/921498v1
             By accepting employment with AOF Services, LLC, I agree that any claim,
             controversy, or other dispute relating to my employment, separation
             from the company, or following separation from the company, shall be
             resolved by arbitration, in lieu of jury trial or any other legal proceeding,
             pursuant to the Federal Arbitration Act (Title 9, United States Code), and in
             accordance with the provisions of the AOF Dispute Resolution Policy
             (“DRP”), which I have received and been given an opportunity to read….”

             (Axp: Exhibit B at p4) (emphasis added). The Dispute Resolution Policy

    itself likewise includes a substantially identical arbitration provision. (Axp: Exhibit

    B at p5) Appellee does not dispute that he agreed to the arbitration agreement or

    that Appellee’s wrongful termination claim in the suit falls within the scope of

    claims covered by the arbitration agreement. AOF thus met its initial burden of

    showing that an arbitration agreement exists between the parties and that the

    dispute in question falls within the scope of the agreement.

             Texas law favors arbitration. In re FirstMerit Bank, N.A., 52 S.W.3d 749,

    756 (Tex. 2001). When a party seeks to compel arbitration and proves a valid

    arbitration agreement exists, a “presumption attaches favoring arbitration and the

    burden shifts to the party resisting arbitration to establish a defense to

    enforcement.” ReadyOne Industries, Inc. v. Flores, --- S.W.3d ---, No. 08-13-

    00161-CV, 2014 WL 6982275 (Tex. App.—El Paso Dec. 10, 2014, no pet. h.).

    Here, Appellee claims the arbitration agreement is unenforceable because it is

APPELLANT’S BRIEF -Page 13
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    unconscionable. The burden of proving that a contract is unconscionable falls on

    the party opposing the contract. In re Poly-Am., L.P., 262 S.W.3d 337, 348 (Tex.

    2008); In re FirstMerit Bank, 52 S.W.3d at 756.

    B. 	     Appellee failed to prove that The Arbitration Agreement Is
             Unconscionable
             Appellee claimed several grounds of unconscionability in his response. The

    trial court did not issue a memorandum opinion, and thus it is not clear on which

    ground or grounds the court found the agreement unconscionable. AOF thus

    addresses each ground asserted by Appellee. Two forms of unconscionability in

    arbitration provisions are recognized in Texas: (1) procedural unconscionability,

    which refers to the circumstances surrounding the adoption of the arbitration

    provision, and (2) substantive unconscionability, which refers to the fairness of the

    arbitration provision itself. Pilot Travel Ctrs., LLC v. McCray, 416 S.W.3d 168,

    180 (Tex. App.—Dallas 2013, no pet.).

             1.    The Arbitration Agreement is a Bilateral Agreement to Arbitrate that
             Applies Equally To AOF and Appellee

             Appellee’s first argument is that the arbitration agreement is substantively

    unconscionable because it is unfairly one sided. Substantive unconscionability of

    an arbitration agreement refers to the fairness of the arbitration provision itself.

    Pilot Travel Ctrs., LLC v. McCray, 416 S.W.3d 168, 180 (Tex. App.—Dallas

APPELLANT’S BRIEF -Page 14
D/921498v1
    2013, no pet.). Appellee’s argument is based solely to the arbitration agreement

    itself, without any other supporting evidence.

             Appellee argues, without authority or support, that only an employee’s

    claims would be subject to arbitration, while “all claims that could ever be brought

    by Defendant AOF” are excluded. This is contrary to the unambiguous language

    of the arbitration agreement. The arbitration agreement provides that “any claim,

    controversy, or other dispute relating to my employment, separation from the

    company, or following separation from the company, shall be resolved by

    arbitration.” This agreement applies equally to employer and employee.

             The agreement has certain exceptions, but these exceptions again apply

    equally to employer and employee, and are primarily for claims subject to

    administrative procedures.      Appellee has provided no evidence whatsoever to

    support its claim that all claims by employers would be excluded by the agreement

    – no legal authority, no examples, no affidavits.

             The case Appellee relies on is wholly distinguishable and illustrates how an

    agreement that a court found is one-sided is different from the AOF arbitration

    agreement. In Royston, Rayzor, Vickery & Williams, L.L.P. v. Lopez, 2013 Tex.

    App. LEXIS 7843 at *23 (Tex. App. – Corpus Christi, June 27, 2013), an attorney

    engagement agreement provided that disputes about services provided under the

APPELLANT’S BRIEF -Page 15
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    agreement would be subject to arbitration but a dispute over payment of services

    would not. Id. at *2. That is two sides of the same coin, and it is thus not

    surprising that, particularly in an attorney/client agreement where a fiduciary duty

    is owed to the client, the court found this to be unfairly one-sided.

             The opposite is true here. The arbitration agreement does not provide that

    one type of claim is arbitrable for the employee but not for the employer. Thus,

    Appellee failed to meet his burden of proving that the arbitration agreement is

    substantively unconscionable.

             2.    The Arbitration Agreement Does Not Unfairly Limit Discovery

             Appellee next argues that the arbitration agreement is substantively

    unconscionable because it unfairly limits his discovery. The relevant provision of

    the arbitration agreement states the following:

             “Discovery – The arbitrator will permit and set deadlines for the completion
             of the following discovery: up to 15 Interrogatories per party, including
             subparts; up to 25 Requests for Production per party, including subparts;
             depositions of the parties to the proceeding and any technical experts
             designated to testify; third party document subpoenas as appropriate; any
             other discovery to which the parties agree.” (Apx: Exhibit B at p6)

             This limitation on discovery is appropriate and fully enforceable. Indeed,

    the Texas Supreme Court held that “limited discovery is one of arbitration’s ‘most

    distinctive features.’” In re Fleetwood Homes of Texas, L.P., 257 S.W.3d 692, 695

    (Tex. 2008) (per curium).        The Court further noted that the argument that

APPELLANT’S BRIEF -Page 16
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    “‘streamlined’ discovery makes arbitration unconscionable would nullify almost

    all arbitration agreements. We hold that arbitration's limits on discovery for both

    parties does not make it unconscionable.” Id. Likewise, the Supreme Court in

    Poly-America held that discovery limits of 25 interrogatories and 25 requests for

    production in the arbitration agreement at issue in that case were not substantively

    unconscionable.

             Appellee agreed to the discovery limits in the arbitration agreement as a

    condition to his employment with AOF, and the discovery limits apply bilaterally.

    Appellee’s so-called evidence in support of his response to the motion to compel in

    which Appellee’s counsel states that in these types of cases he sends

    “approximately 85 requests for production” and “21 interrogatories with permitted

    subparts” (see Apx: Exhibit F p1) is no evidence at all.

             Appellee fails to identify and provide specific evidence as to why the

    Appellee cannot reasonably meet his proof burden based upon the discovery that is

    provided for in the arbitration agreement.      Appellee fails to provide specific

    evidence of what information Appellee reasonably must obtain from AOF in the

    additional 60 requests for production and the additional 7 Interrogatories that

    Appellee’s attorney allegedly normally serves in this type of case, and why that

    information is not otherwise reasonably obtainable through deposition testimony,

APPELLANT’S BRIEF -Page 17
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    or any other discovery that the parties could agree to. Furthermore, Appellee fails

    to provide any evidence that Appellee cannot reasonably obtain the information he

    needs to meet his burden of proof under the discovery limitations in the arbitration

    agreement.

             3. 	   The Fee-Splitting Agreement In The Arbitration Agreement Is Fair
                    And Reasonable

             Appellee’s final argument is that the arbitration agreement is substantively

    unconscionable because it requires the Appellee to pay prohibitively excessive

    arbitration costs. The arbitration agreement between AOF provides, in relevant

    part:

             “…An initiating Team Member will pay the first $100 in filing fees to
             the AAA and the Company will pay the portion of filing fees that
             exceed $100, plus any other administrative fees or costs (other than
             the arbitrator’s compensation). The arbitrator’s compensation will be
             paid 20% by the Team Member and 80% by the Company.” (Apx:
             Exhibit B at p6)
                                      *    	*   *
             “…The arbitrator may award attorney’s fees and costs of
             arbitration to a prevailing party….” (Apx: Exhibit B at p6)

             In Texas, fee-splitting provisions in employment arbitration agreements are

    not per se unconscionable.         Poly-America, 262 S.W.3d at 355-56.           The

    complaining party opposing arbitration must introduce some evidence that it will

    incur arbitration costs that would deter enforcement of statutory rights in the

APPELLANT’S BRIEF -Page 18
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    arbitral forum. Id. at 356 (emphasis added). Appellee has not provided such

    evidence.

                  Mere “risk” that a claimant may have to pay prohibitive costs is too

    speculative to justify the invalidation of an arbitration agreement. Poly-America,
262 S.W.3d at 356 (citing Green Tree Fin. Corp.—Ala. v. Randolph, 531 U.S. 79,

    91 (2000)). In Poly-America, the Supreme Court found the arbitration clause

    between an employer and employee that provided for fees to be split equally was

    enforceable because: (1) the record contained no evidence of the employee’s likely

    share of arbitration costs and (2) the arbitration agreement specifically provided

    that the arbitrator could modify unconscionable terms. Id.

             In McCray, the court considered an employment arbitration provision that

    provided the costs and fees charged by the arbitrator would be borne equally by the

    parties, but, like the arbitration agreement here, allowed for discretion by the

    arbitrator to “reapportion the arbitration fees (except attorney fees) and costs in a

    manner which the arbitrator deems equitable.” Additionally, the arbitration

    agreement in McCray limited fees borne by the employee to no more than one-half

    of the fees and costs. Here, the agreement is even more favorable to Appellee,

    providing that AOF shall pay 80% of the fees and costs.

             The court in McCray found that there was no evidence on the record
APPELLANT’S BRIEF -Page 19
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    indicating that the appellees did not have the financial ability to pay a portion of

    the arbitrator’s fees or that arbitration would be more costly than litigation in state

    court.    McCray, 416 S.W.3d at 181. Consequently, the court concluded that the

    employees failed to establish a defense of unconscionability and that the arbitration

    provision should be enforced. Id. Likewise, as is discussed in detail below,

    Appellee failed to provide competent evidence that he does not have the financial

    ability to pay any portion of the arbitration fees or that the cost of litigation in state

    court would be less costly.

             Even if a plaintiff provides competent evidence to show the likely costs of

    arbitration, he or she must also provide evidence demonstrating the likelihood of

    incurring such costs. In re Weeks Marine, Inc., 242 S.W.3d 849, 859 (Tex. App.—

    Houston [14th Dist.] 2007, mand. denied) (citing Green Tree, 531 U.S. at 92

    (“where, as here, 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”). In In re Weeks Marine, the

    agreement provided for subsequent allocation of fees between the parties after

    Weeks Marine paid the filing fee and any deposit for arbitrator compensation. Id.

    at 860. The Houston Court of Appeals held that the fee-splitting agreement was

    not unconscionable and the arbitration agreement was enforceable. Id.

APPELLANT’S BRIEF -Page 20
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             In support of his argument, Appellee offers the affidavits of Javier Espinoza

    and Ronald Santorsola (Axp: Exhibits F and G).

             The Espinoza affidavit is offered as evidence of the potential arbitrator fees

    that might be incurred by the parties in the arbitration of this case, alleging that the

    invoice attached to the affidavit is representative of the arbitration costs that would

    be incurred in this case.

             However, the Espinoza affidavit fails to establish what the anticipated

    arbitrator’s fees would be and what Appellee’s share of the anticipated arbitration

    costs would reasonably be anticipated to be in the arbitration of his claims with

    AOF. There are several reasons the Espinoza affidavit fails to establish what the

    anticipated arbitrator’s fees in this case would be and what Appellee’s anticipated

    share of the anticipated arbitration costs in the arbitration of his claims with AOF

    would be.

             The Espinoza affidavit states that the arbitration of the Christine Torres v.

    Stagg Restaurants case to which the attached aribtors’ invoice is attached was for

    an arbitration that lasted only one day, stating in relevant part:

             “…The arbitration took place in San Antonio, TX in the
             spring of 2013 and lasted only one day.” (Apx: Exhibit F at
             p1)

    But this sworn statement directly conflicts with the arbitrator’s invoice which

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    identifies anticipated arbitrator’s fees and costs for three days of arbitration

    (identified on the invoice as the days of 01/22/2013, 01/22/2013, and 01/23/2013),

    stating in relevant part:

             “..Your Share of the Neutral Compensation Deposit
             covering 3 days of Hearing…..7,500” (Apx: Exhibit F at p2)

             Additionally, the Invoice/Statement reflects anticipated arbitrator’s charges

    of $7,500 for 24 hours of Study.

             The Invoice/Statement attached to the Espinoza affidavit appears to be only

    a cost estimate, or a request for a deposit for a three day arbitration and a deposit

    for 24 hours’ worth of “Study” by the arbitrator. The Invoice/Statement on its

    face is not a representation of the actual costs incurred in the arbitration of the

    Christine Torres v Stagg Restaurants case.

             The Espinoza affidavit states that the “Total cost for the entire arbitration,

    from start to finish, was $20,225.” This large figure is not represented on the

    attached Invoice/Statement anywhere, and based upon the Invoice/Statement it

    cannot be accurate or valid for the actual charges incurred for a one day arbitration,

    which could only reasonably be guessed at being a third of the $17,250 figure of

    the Invoice/Statement. There is no evidence that 24 hours of “Study” for the

    arbiter would be applicable to the arbitration of Appellee’s claim against AOF.

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             Not only does the Espinoza affidavit completely misrepresent the arbitrator’s

    actual charges for a 1 day arbitration based on the attached Invoice/Statement,

    more critically it fails to ever state: a) that the arbitration of Appellee’s claims

    against AOF in this dispute will require 3 days arbitration and 24 hours of “Study”

    by the arbitrator so that an arbitrator’s fee in excess of $20,000 is reasonably

    anticipated; and b) that the Appellee will likely actually incur arbitration costs

    exceeding $5,000.

             The Espinoza affidavit states that Appellee’s case against AOF is very

    similar to the Christine Torres v Stagg Restaurants case, which at best implies that

    it would require a 1 day arbitration, since it identifies the cases as being similar,

    and not a 3 day arbitration. Based on the Invoice/Statement, the arbitrator’s fees

    for a 1 day arbitration in the Christine Torres v Stagg Restaurants case could not

    possibly be the $20,225 asserted in the affidavit. The Invoice/Statement does not

    state what the arbitrator’s fees actually were for a 1 day arbitration in the Christine

    Torres v Stagg Restaurants case.

             What the Espinoza affidavit specifically states regarding the anticipated

    arbitrator’s fees is as follows:

             “If Mr. Santorsola is required to arbitrate his case through
             a similar arbitration association, the cost for the arbitration
             and litigation process will reasonably exceed $5,000, if he is
             require to pay approximately twenty percent of the costs”.

APPELLANT’S BRIEF -Page 23
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             (Apx: Exhibit F at p1)

    Espinoza’s statement in the affidavit alleges that the entire cost of the arbitration

    and litigation process will reasonably exceed $5,000, but fails to specifically allege

    what Mr. Santorsola’s portion of those costs would be. The affidavit fails to

    specifically state what Mr. Santorsola’s anticipated portion of the anticipated

    arbitrator’s fees would be.

             In additional support for its argument, Appellee also submits the affidavit of

    Ronald Santorsola (Apx: Exhibit G), which states in relevant part:

             “…If it is determined that I must bring my lawsuit against 

             my employer in arbitration, and risk having to pay over 

             $5,000 in arbitrator fees, I will probably not continue with 

             my claim. This risk is too great for me and I do not have 

             that type of money…” (Apx: Exhibit G at p1) 

    Santorsola’s affidavit does not state that he reasonably anticipates incurring $5,000

    in arbitrator’s fees in the arbitration of his claim against AOF.

             Neither the Espinoza nor the Santorsola affidavits state what the actual

    anticipated arbitrator’s costs Santorsola reasonably anticipates incurring would be

    for the arbitration of his claim against AOF. The record fails to offer any

    evidence of what the actual anticipated arbitrator’s costs Santorsola reasonably

    anticipates incurring would be.

             The record establishes that Appellee has failed to meet his burden of proof to

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    establish Appellee’s likely share of arbitration costs.

             Finally, the arbitration agreement authorizes the arbitrator to award

    arbitration fees and costs against a party.          In relevant part, the arbitration

    agreement states:

             “…The arbitrator may award attorney’s fees and costs of
             arbitration to a prevailing party…” (Apx: Exhibit F at p6)

    Because the arbitrator is authorized to award Appellee his arbitration costs if he

    prevails in the arbitration, Appellee may not be responsible for any arbitrator’s fees

    at all in the arbitration.

             The record establishes as a matter of law that Appellee has failed to meet his

    burden of proof to establish that the arbitration agreement is substantively

    unconscionable because Appellee might incur arbitrator’s costs that would deter

    enforcement of statutory rights in the arbitral forum.

APPELLANT’S BRIEF -Page 25
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                                  CONCLUSION/PRAYER

             For the reasons stated herein, AOF requests this Court to find that the trial

    court erred by finding that 1) the arbitration agreement is unconscionable, and 2)

    that the arbitration agreement is unenforceable.      AOF requests this Court to find

    that the trial court erred by denying the Plea in Abatement and Motion to Compel

    Arbitration.

             Accordingly, AOF respectfully requests that the order denying the Plea in

    Abatement and Motion to Compel Arbitration be reversed. In the alternative, AOF

    prays that this Court remand this cause to the trial court for further proceedings

    consistent with its opinion on the issues presented herein. AOF further requests

    that this Court award it its costs of court on appeal.

             AOF further prays for such other and further relief, both general and special,

    at law or in equity, to which it is justly entitled, and for which it will ever pray.

APPELLANT’S BRIEF -Page 26
D/921498v1
                                    Respectfully Submitted,

                                    LAW OFFICES OF PAUL C. ALLRED

                                    Paul C. Allred
                                    State Bar Number: 001102000

                                    Campbell Centre II
                                    8150 North Central Expressway, Suite 700
                                    Dallas, Texas 75206
                                    Telephone Number (214) 449-9496
                                    Facsimile Number (214) 276-1325

                                    ATTORNEY FOR APPELLANT

                             CERTIFICATE OF SERVICE

          The undersigned attorney at law, does hereby certify that a true and correct
    copy of the foregoing attached instrument has been served upon the Appellee,
    Ronald Santorsola by and through his respective attorney of record on this the 13th
    day of February, 2015.

                                    Paul C. Allred

APPELLANT’S BRIEF -Page 27
D/921498v1
                                      APPENDIX

    Exhibit A: 	 Defendant’s Original Answer, Plea in Abatement, and Motion
                 to Compel Arbitration

    Exhibit B: 	 Affidavit for Admission of Business Records

    Exhibit C: 	 Plaintiff’s Response in Opposition to Defendants Motion to Compel
                 Arbitration, Request for Evidentiary Hearing, and Motion for
                 Sanctions

    Exhibit D: 	 Court’s Finding of Unconscionability

    Exhibit E: 	 Order Concerning Defendant’s Motion to Compel Arbitration

    Exhibit F:	 Affidavit of Javier Espinoza

    Exhibit G: 	 Affidavit of Ronald Santorsola

APPELLANT’S BRIEF -Page 28
D/921498v1
 Appellant’s Brief

Exhibit A 

                                                      NO. 25,609 

RONALD SANTORSOLA                                             §      IN THE DISTRICT COURT
Plaintiff,                                                    §
                                                              §
V. 	                                                          §      25TH JUDICIAL DISTRICT
                                                              §
AOF SERVICES, LLC                                             §
Defendant.                                                    §      OF GONZALES COUNTY, TEXAS

                       DEFENDANT'S ORIGINAL ANSWER, AND 

             PLEA IN ABATEMENT, and MOTION TO COMPEL ARBITRATION

          NOW COMES Defendant, AOF Services, LLC, named Defendant in the above-entitled

and numbered cause, and files this Original Answer, Plea In Abatement, and Motion To Compel

Arbitration, and shows the Court:

                                                              I. 

                                 PARTY IDENTIFICATION INFORMATION 

          AOF Services, LLC has not been issued a driver's license. AOF Services, LLC has not

been issued a Social Security number.

                                                             II. 

                                  PLEA IN ABATEMENT – ARBITRATION

          1.	       Plaintiff and Defendant entered into a written agreement whereby they agreed that

                    the claims Plaintiff has plead in this lawsuit would be subject to binding

                    arbitration.

          2.	       The Dispute Resolution Policy contained in that certain Offer of Employment

                    document executed by the parties on June 13th, 2013 (a true copy of which is

                    attached hereto as Exhibit “A” and incorporated hereinafter for all purposes),

Defendant’s Original Answer,

Plea in Abatement, and Motion To Compel Arbitration   Page: 1 

                    states in relevant part:

                                “By accepting employment with AOF Services LLC, I
                               agree that any claim, controversy or other dispute relating
                               to my employment, separation from the company, or
                               following separation from the company, shall be resolved
                               by arbitration, in lieu of a jury trial or any other legal
                               proceeding, pursuant to the Federal Arbitration Act (Title 9,
                               United States Code), and in accordance with the provisions
                               of the AOF Services LLC Dispute Resolution Policy
                               (“DRP”), which I have received and been given an
                               opportunity to read…”

          3.	       Accordingly, AOF Services, LLC requests that this suit be abated and that the

                    dispute between the parties be subjected to arbitration between the parties.

                                                               III.

                                    MOTION TO COMPEL ARBITRATION

          4.	       The allegations in paragraphs 1, 2 and 3 are incorporated herein as if set forth at

                    length.

          5.	       A valid written arbitration agreement exists between the parties and covers the

                    claims presented in this lawsuit.

          6.	       Pursuant to Section 171.021(a) of the Texas Civil Practice and Remedies Code,

                    AOF Services, LLC requests that the Court order the parties to arbitrate the claims

                    presented in this suit and to stay this proceeding pending the completion of the

                    arbitration proceeding.

                                                               IV.

                                                      GENERAL DENIAL

          7.	       Subject to the forgoing Plea in Abatement and Motion to Compel Arbitration,

                    Defendant AOF Services, LLC denies each and every allegation of Plaintiff's

                    Original Petition, and demands strict proof thereof as required by the Texas Rules

Defendant’s Original Answer,

Plea in Abatement, and Motion To Compel Arbitration      Page: 2 

                    of Civil Procedure.

                                                            IV. 

                                                       PRAYER

          Defendant prays the Court will abate this lawsuit and order the parties to arbitrate the

claims herein; furthermore and after notice and hearing or trial, Defendant prays that the Court

will enter judgment in favor of Defendant, awards Defendant the costs of court, attorney's fees,

and such other and further relief as Defendant may be entitled to in law or in equity.

Defendant’s Original Answer,

Plea in Abatement, and Motion To Compel Arbitration   Page: 3 

                                                         Respectfully submitted,

                                                         By:
                                                                  Paul C. Allred
                                                                  Texas Bar No. 01102000

                                                         8150 N. Central Expressway, Suite 700
                                                         Dallas, TX 75206
                                                         Tel. (214) 448-9496
                                                         Fax. (214) 276-1325
                                                         paulallred@msn.com

                                                         Attorney for Defendant
                                                         AOF Services, LLC

                                                          FIAT:

A hearing shall be heard on Defendant’s Plea in Abatement and Motion To Compel Arbitration
on _________________ at ____ o’clock ___m..

                                                         _____________________________
                                                         Judge Presiding

                                            CERTIFICATE OF SERVICE

       I certify that on April 11th, 2014, a true and correct copy of Defendant's Original Answer
and Plea in Abatement was served on Plaintiff’s attorney of record, Javier Expinoza, 503. E.
Ramsey, Suite 103, San Antonio, TX 78216.

                                                         Paul C. Allred

Defendant’s Original Answer,

Plea in Abatement, and Motion To Compel Arbitration   Page: 4 

                                   EXHIBIT “A” 

Defendant’s Original Answer,

Plea in Abatement, and Motion To Compel Arbitration   Page: 5 

 Appellant’s Brief

Exhibit B 

 

 

 

 

 

 

 

 

    EXHIBIT A
 
 Appellant’s Brief

Exhibit C 

 Appellant’s Brief

Exhibit D 

 Appellant’s Brief

Exhibit E 

                                        CAUSE NO. 25,609 

RONALD SANTORSOLA, 	                                §                  IN THE DISTRICT COURT 

                                                    §

               Plaintiff                            §

                                                    §

v. 	                                                §                    25 th JUDICIAL DISTRICT
                                                    §
AOF SERVICES, LLC                                   §
                                                    §
               Defendant.                           §              GONZALEZ COUNlY, TEXAS

   ORDER CONCERNING DEFENDANT'S MOTION TO COMPEL ARBITRATION

       On this the 9th day of May 2014 came to be heard Defendant's Motion to Compel

Arbitration. The Court having considered the Motion and all applicable arguments, case law and

evidence is of the opinion that the following Order is appropriate and necessary.

       IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that Defendant's

Motion to Compel Atbitration is hereby in all things DENIED.

       SIGNED and ENTERED this
                                              ,\"             J\
                                        th~\) day of \).\.L ~1t.(               ,2014.

                                               HON. JUDGE PRESIDING 

PAUL C. ALLRED
8150 N. Central Expressway, Suite 700
Dallas, TX 75206

                                                                                              14
 Appellant’s Brief

Exhibit F 

 Appellant’s Brief

Exhibit G