Legal Case Summary

Carbo? Well, you ready. Thank you, Your Honor May, please the Court, Larry Carbo and Paige, Kaelish, for the appellate cellular sales of Knoxville and cellular sales of South Carolina. Now, what this case comes down to is two plaintiffs that seek the benefits of employment, but do not want the consequences of that employment. And what I'd like to do initially is give a little bit of background here as to the relationship between cellular sales and these two plaintiffs in connection with their employment relationship and a prior independent contractor relationship. And I think that's important because I don't believe that I did a very good job doing that before the district court because I think the district court entered an order that maybe indicated that there was some misunderstanding as to the prior relationship. So if I could, cellular sales is a company that has a contract with Verizon to sell the Verizon Wireless Service in various states throughout the country, including South Carolina. Prior to January 1st, 2012, cellular sales did not have employees as sales representatives to sell this service. Although the plaintiffs allege that they facto, they were employees. That is what the plaintiffs allege, which is why we're here today. They bring the FLSA claim. That's absolutely correct, Your Honor. The argument that the plaintiffs have, both of the claims that they bring in this lawsuit are claims that necessarily require that they are employees. So to prevail on those claims, they will have to demonstrate that in fact they were employees, which gets us to the compensation agreement that each of these individuals signed when they became employees of the company. They signed the agreement on January 1st, 2012. Cellular sales made a global change to the way it was conducting its business in January of 2012, and as part of that decided to actually hire sales representatives as opposed to contracting with sales companies. Now there's no dispute, at least from my client's perspective, that prior to January 1st, 2012, these individuals were not employees of the company. They had... So you say there's no dispute. Of course there's a dispute. The plaintiffs, the last day were the fact they were employees

. My client's position has always been that they were not employees until January 1st, 2012. These two individuals were employees of their own company that contracted with Cellular sales. Right, and that's the dispute. Exactly, Your Honor. So if I could turn then to the compensation agreement here in the arbitration clause that is at issue is, I think it's important to look at the language of that contract because of the district court's ruling, because the contract itself does not limit the arbitrable claims to those claims arising from the compensation agreement. In fact, it's very clear that it says it's claims disputes or controversies that arise out of the document, the document being the compensation agreement that they signed in January of 2012, or the employee's employment with the company. So that or there necessarily means that there's something else besides... What's the company? What's the company? The company is Cellular sales, Your Honor. Right, and that existed at the same time they signed that document. There was no pre-existing employment with the company before that. That's your position. They were employees. They were not employees before the time they signed that document. There was no pre-existing employment relationship with them in your company. Their relationship was with their sales company. Right? Absolutely, Your Honor. Okay, so what you want to do is you want to make an arbitration clause not only be its possible retroactivity, but you want one where it makes someone susceptible to an arbitration. They weren't even parties before that time. That's absolutely correct, Your Honor

. If I can explain why I think that in this particular case it's appropriate. I think it's appropriate because if we assume for a moment that these individuals were employees prior to January 1st, 2012, which is what the plaintiffs will ultimately have to prove to the court. I'm sorry to interrupt, but why would we assume that? Because they don't have to assume anything. In order for the plaintiffs to prevail in this case, there will have to be a finding that they were employees. They will have to be a finding, exactly. But we don't have to assume anything. We don't make findings up here. That's a role of the trial judge. But for purposes of whether or not the court should compel arbitration, you have to look at the pleading itself. If you look at the plaintiffs complaint and you go through the plaintiffs complaint, throughout the complaint they allege that they were employees prior to January 1st, 2012. Which is why we don't have to assume it. That's what we look to at this point. You look at the complaint. That is correct, Your Honor. The complaint itself specifically says or alleges that the plaintiffs in this particular case were employees at all times prior to January 1st, 2012 and at times after January 1st, 2012. There's no, the plaintiffs make that consider. You're referring to the now in operative complaint. No, Your Honor. I'm referring to the amended complaint. The amended complaint, which is the complaint that the district court entered its order denying the most to compel arbitration on. The district court looked at the amended complaint and looked at the amended complaint

. All it did was to carve out any claims after January 1st, 2012 when the conversion occurred. Exactly. And that's why I'm sorry. I really don't mean to keep interrupting you, but you said you alluded to allegations about post January 1st, but the plaintiffs have essentially abandoned any claim purportedly arising after January 1st. They do abandon their claims after January 1st, 2012, but they don't abandon their claims that they were in fact employees prior to January 1st, 2012. Exactly. In fact, in their complaint, they continue to take the position that they were employees prior to January 1st, 2012. Right. And what I was trying to explain before is if these people were employees prior to January 1st, 2012, and they would have signed this compensation agreement on January 1st, 2012 that had the arbitration provision and had there not been an arbitration provision before that, I think the fourth circuit is clear that that would be retroactively applied to these individuals pre-January 1st, 2012 relationship. So if we look at how this plays out with the allegations in the complaint, which is what we have to rely upon, these individuals are saying that they were employees. If they were employees prior to January 1st, 2012, it doesn't matter under fourth circuit law that they didn't sign an agreement to arbitrate their claims until January 1st, 2012. You're not using this language, but it really sounds like you're arguing some form of judicialist stopper or something. I understand retroactivity, and certainly this court and the Supreme Court have been very willing to find retroactivity when it comes to sort of intervening arbitration clauses. But here we have very different facts. We have on the ground real facts that these plaintiffs were employees of their own LLCs. Now for purposes of the FLSA claims, they allege that they were de facto employees and should have been treated as employees for wage purposes by your client. But that's a far cry from the counterfactual hypothetical you just articulated, which was suppose they'd never had an LLC before January 1st. Then they signed these contracts requiring arbitration. I think you'd win. I think you would have won below. I think that the district court would have said, well, under fourth circuit law, it's a look back in a look forward when you insert an arbitration clause into an agreement midstream

. But that's not what happened here. It's absolutely not what happened here. And I would agree with your honor that that would certainly make it a much easier case for my clients' perspective. It makes it a very different case. I don't know that it's a very different case. I can't agree that it's a very different case because I don't believe that what the district court had to do in connection with determining whether or not these claims were subject to the arbitration is to look to the complaint itself. And if you look to the complaint itself, the allegations of employment is what triggers the arbitration clause in this particular case. Or is it? No. Obitration clause comes by contract agreement, right? That's correct, your honor. All right. Now, it is undisputed. You get about allegations. We don't need allegations when it's undisputed. It's undisputed as in terms of contractual standpoint. They were employed by a sales company. They had no contract with your company, correct? That's the amount of law. That's correct. Prior to January 1st, 2012, the individuals did not. All right. We get about what they alleged because you both kind of talk about both sides of your market, not employees, our employees, all kind of things. But with that case, isn't this case more than retroactivity? I think Judge Davis was in terms of laying out in terms of this intervening

. You were asking for retroactivity and you want to apply it with the part of you want to have it enforced against was not illegal. There was no contract with privity with you. It's different. In other words, you were an employee year before. Now you're an employee now. It's retroactive where you were the same status. But problem here is not only at retroactivity, they were not in contract. They were in contract with your company. And that's not disputed, correct? That's not disputed, Your Honor. But what my client contracted for in January of 2012 when it had these individuals signed the compensation agreement as a condition of their employment was that all employment-related disputes were going to be compelled to arbitration. And in this particular case, they're with the company. With the company. That's correct, Your Honor. But you made the choice of the word. You should have said, not this employment with you. Whatever position you were in prior. In other words, when you said with the company, legally they were not employed by your company. But the dispute that we're litigating is now an employment-related dispute with the company. The claim is being brought against the company. My client contracted in January of 2012 that those types of claims, any claim related to employment-related claims, are going to be compelled to arbitration. So at some point, if in fact the plaintiffs are successful in proving that they were not independent contractors and were misclassified, there is going to be an employment-related dispute because it's necessarily an FLSA and a South Carolina wage claim that the court will have to consider

. So I don't know that the prior relationship, while it certainly muddies the waters a bit in this particular case, at some point this is an employment-related dispute. I do that everyone agreed was going to be subject to arbitration. And I'll reserve the rest of my time. Thank you, Your Honor. Thank you so much. Mr. Doxan. Thank you, Your Honor. May it please the court, Robert Dodson for the appellate, Dan Newbanks, and Jenny Walton. The issues before this court are simple and straightforward issues. First, can a party be compelled to arbitrate claims they did not agree to arbitrate? And the second issue is can the court enforce an arbitration agreement that not only forces arbitration on the plaintiffs, but also attempts in the wording of that very arbitration agreement to rip away from the plaintiffs, statutorily guaranteed rights under federal statute. The answer to both of those questions is no. The answer no was reached by the district court on the first issue, and it should be affirmed here today. The appellate's argument to this court on this first issue, that whether the arbitration clause that issue applies, must be based on the allegations of the claim, is off base and wrong. That is not the law on the circuit, that is not the law in the United States. In making this argument, what the appellate is doing is taking a legal standard, a legal standard, to a private contract, and you simply can't do that. Ironically enough. Your claim is that the appellees are employees, so they are entitled to certain wage and our considerations. That's your claim, correct? That's what we need to look to now. So how is that not an employee related dispute when we're to look at the very broad language of the arbitration clause here and the law favors arbitration? I'm glad that you asked the question, Your Honor, and I'm glad that you asked because the point that I want to make to this court is this, for the purposes of our complaint, whether that be the original complaint or the amended complaint. Right, they're the same

. When we plead in our complaint that they violated the Fair Labor Standards Act, what we are saying to the court is, court, we get, we meet the legal standard set forth for employee under the Fair Labor Standards Act. We meet that standard, and therefore we get the protections afforded to us under that standard. Right, you want the protections of that statute. I mean, I don't know how a Fair Labor Standards Act complaint is not an employee related dispute. So you want the protections of that statute, but then you don't, you want to have your cake and eat it too, you don't want arbitration for this employee related dispute. We don't, Your Honor, we respectfully don't, and this is why, because when we plead, we are pleading as to the merits of our case that we meet the standard, okay? But when it comes to the FAA, what this court has always focused on is the contracts, not so at all, not so at all, with regard to the Fair Labor Standards Act, okay? Under the Fair Labor Standards Act, what the parties contract for doesn't matter. There is a different standard set forth under the Fair Labor Standards Act than there is for purposes of the FAA. In fact, doesn't the Fair Labor Standards Act actually prohibit forfeiture of the benefits and rights under that statute? Absolutely. For those unique federal statutes that says the person can't sign away these rights. That is absolutely correct, Your Honor, and that goes to the second issue that I raised. It's not to say, I'm sorry, but it's not to say you can't arbitrate those rights. That's right. If you can't sign them away. That is absolutely right. Under both the FAA and the Fair Labor Standards Act, when you take those two acts together and you take the case law together, what you can do is you can agree to change the venue or change the forum. Where you resolve disputes under the Fair Labor Standards Act. But you can't prospectively wave your statutorily guaranteed rights under the Fair Labor Standards Act. Would you have a collective action right under the arbitration clause in this case? I don't remember what it said. If we just looked at the arbitration clause itself, could we bring a class action under the arbitration clause if that was an enforceable clause which I'm going to argue that it was not. I understand. But no

. I believe that it says, and it's on page 70, the joint of business. You can't bring a collective action. It says you can't bring a class out. But it goes beyond that, Your Honor. It goes far beyond that. Because it goes on to say, among other things, that we can't recover statutorily, we can't recover statutorily damages. The Fair Labor Standards Act says we can get liquidated damages. The Fair Labor Standards Act says we can get attorneys fees if we prevail. But under this arbitration agreement, it says that we can't do that. It says that parties agree that no arbitrator has the authority to award punitive damages or other damages not measured by the prevailing parties actual damages. Judge, you can't do that. I mean, you can't do that. I mean, they can't do that. You said, Judge, you could do anything you want to. Well, that's not true. Congress makes that clear. But humor aside, they can't do that. Can I ask you this? Yes, sir. Have you all proceeded yet in the district court to identify the members of the class here, the collective action? We have not. Things have just stopped pending appeal. What happened? What's your estimate of how many members are going to be in the class today? I would estimate several hundred

. Several hundred. But that is... So if it's a willful violation, it's a three-year look-back, we're talking about some real money here potentially. We're talking about some significant money. And the estimate I gave you is, I'm really just... I'm guessing. I mean, I really am guessing. But to answer your question, we think it's several hundred, maybe over a thousand. I don't know. But my point earlier was that... And I want to be clear, Your Honor, we didn't do a good job briefing this. We did not do a good job briefing. The issue of what is the arbitration clause actually, say, aside from the employee, you know, beginning beyond that part of the arbitration. And that's why I want to make clear to the court here today. You simply can't enforce this arbitration clause because it's not just an arbitration clause

. It's a lot more than that. It attempts to rip away statutory rights that Congress has afforded to the plaintiffs. And that's why I was saying to Your Honor's question earlier, when you asked about employee and doesn't this involve an employment dispute, that's why I was saying earlier to that question that when we make legal pleadings, what we are saying to the court is, we meet the standard of the statute that we're suing on. We meet that standard, okay? Because in the law, there are different standards, even in this area of labor and employment law. There are different standards. There are different legal tests. There are different legal definitions of employee, employer, independent contractor. Okay. And for purposes of the FAA, that doesn't matter because under this circuit's FAA law, what matters is how the party is contracted. What governs is how they contracted. Well, how they contracted changed pretty radically because what they contracted for prior to January, 2012, was a relationship of independent contractor. And that changed after that. They get to define their relationship for purposes of the FAA. That's what the FAA does. It encourages the parties, or if it doesn't encourage it, at least allows the parties, to contract for what they want to contract for with regard to arbitration. It allows them to arbitrate disputes as opposed to litigating disputes. And they can contractually agree to any relationship that they are. You don't limit the FAA's reach to just labor and employment issues. I mean, it can have all kinds of far-reaching implications, contractor with subcontractor, and a whole host of variety of other things. That's what that act allows. But with regard to the Fair Labor Standards Act, that's a different legal standard altogether. And the standard there is an economic reality standard. Well, look, in this area of law, we get into this issue in tort law, too, with regard to the doctrine of responding out superior. We get into this, and we say that in order to prove a responding out superior, you have to show that the alleged employer had actual control of the manner of performance. Well, that's a different standard than what the parties contracted for here. That's a different standard than what the Fair Labor Standards Act applies. Are you on the preemption? No, no, sir. No, sir. You know how it is preemptive? No, no, sir. Not at all, sir. But again, take another example. So you agree, otherwise, that retroactivity could occur if these were employees, and just later hit them. There is no question that this circuit, and they've sided a host of cases for you, there's no question that this circuit has retroactively applied arbitration agreements. No question about that. All right, now, the cases that they've sided to you differ in four significant ways. First of all, they differ because in every one of those cases, every one of the cases they sided for to you. They didn't, they, the parties agreed to arbitrate, but that didn't change the underlying rights that they were disputing. They didn't try to rip away statutorily guaranteed rights in any of those cases, because you simply can't do that, your honor, and all of those cases are different, because all of those cases were essentially, we agreed to arbitrate. We agreed to arbitrate. We agreed to arbitrate. But this arbitration clause that's now before this court went far beyond that, because it took away statutorily guaranteed rights, and the district court never reached that issue, because the district court simply concluded the plaintiffs are going to limit themselves to prior to January 2012, so that, that essentially resolved the issue. But it's certainly relevant here today, because when you look at the Supreme Court, and what the Supreme Court has said about this, they said in the Gilmer versus Interstate slash Johnson case, this is a quote, in dealing with an ADA playing, so long as the prospective litigant effectively may vindicate his or her statutory cause of action in the arbitration forum, the statute, meaning the ADA, will continue to serve both its remedial and deterrent function

. And the standard there is an economic reality standard. Well, look, in this area of law, we get into this issue in tort law, too, with regard to the doctrine of responding out superior. We get into this, and we say that in order to prove a responding out superior, you have to show that the alleged employer had actual control of the manner of performance. Well, that's a different standard than what the parties contracted for here. That's a different standard than what the Fair Labor Standards Act applies. Are you on the preemption? No, no, sir. No, sir. You know how it is preemptive? No, no, sir. Not at all, sir. But again, take another example. So you agree, otherwise, that retroactivity could occur if these were employees, and just later hit them. There is no question that this circuit, and they've sided a host of cases for you, there's no question that this circuit has retroactively applied arbitration agreements. No question about that. All right, now, the cases that they've sided to you differ in four significant ways. First of all, they differ because in every one of those cases, every one of the cases they sided for to you. They didn't, they, the parties agreed to arbitrate, but that didn't change the underlying rights that they were disputing. They didn't try to rip away statutorily guaranteed rights in any of those cases, because you simply can't do that, your honor, and all of those cases are different, because all of those cases were essentially, we agreed to arbitrate. We agreed to arbitrate. We agreed to arbitrate. But this arbitration clause that's now before this court went far beyond that, because it took away statutorily guaranteed rights, and the district court never reached that issue, because the district court simply concluded the plaintiffs are going to limit themselves to prior to January 2012, so that, that essentially resolved the issue. But it's certainly relevant here today, because when you look at the Supreme Court, and what the Supreme Court has said about this, they said in the Gilmer versus Interstate slash Johnson case, this is a quote, in dealing with an ADA playing, so long as the prospective litigant effectively may vindicate his or her statutory cause of action in the arbitration forum, the statute, meaning the ADA, will continue to serve both its remedial and deterrent function. But that reasoning and that logic applies equally to FLSA claims. And in fact, this court, and I didn't cite these cases in my brief, and I apologize for that. But in two cases from this court, in the on-ray cotton yarn, antitrust litigation, and in the POTE versus Rich Products Corporation case, relying on Supreme Court precedent in this area, the court said you cannot, through an arbitration clause, prospectively limit the damages that are statutorily guaranteed to appoint... Sounds like you're arguing that you regret your amended complaint. I don't regret it, no, sir. I don't regret it at all. Sounds like you're saying, I, now that you've thought about it, and I don't mean this is criticism, it's a analogy you've thought about it, seems like maybe you should have persisted in the post-January 1st claim as well. Well... And maybe you'll do that when and if the case goes back. Yeah, maybe so, Your Honor. Because hindsight is 2020. Wisdom, when you see... I will tell you what I do regret. What I do regret is not bringing this issue to the forefront with the district court, and what I do regret is not better briefing that issue before the court day. Yeah, you didn't do it until standing here right now

. But that reasoning and that logic applies equally to FLSA claims. And in fact, this court, and I didn't cite these cases in my brief, and I apologize for that. But in two cases from this court, in the on-ray cotton yarn, antitrust litigation, and in the POTE versus Rich Products Corporation case, relying on Supreme Court precedent in this area, the court said you cannot, through an arbitration clause, prospectively limit the damages that are statutorily guaranteed to appoint... Sounds like you're arguing that you regret your amended complaint. I don't regret it, no, sir. I don't regret it at all. Sounds like you're saying, I, now that you've thought about it, and I don't mean this is criticism, it's a analogy you've thought about it, seems like maybe you should have persisted in the post-January 1st claim as well. Well... And maybe you'll do that when and if the case goes back. Yeah, maybe so, Your Honor. Because hindsight is 2020. Wisdom, when you see... I will tell you what I do regret. What I do regret is not bringing this issue to the forefront with the district court, and what I do regret is not better briefing that issue before the court day. Yeah, you didn't do it until standing here right now. I didn't. Yeah. You know, I thought I heard you say there were four reasons why this case is different from Fourth Circuit precedent, and I've only heard I think one so far. I really would like to hear the other three. Yes, sir. Yeah, I guess, ma'am, I'm sorry. Another mistake by me. He pointed out one, and I just made another one. The second, third and fourth reason. Okay. In the other cases that they've cited to you, there is a merger or integration clause. That gets us to the carous notion versus hallmark case. That's in the Levine case. Not present here. If they wanted to go back, and they wanted to capture that first contract, they needed a merger or integration clause that says we're going back. And everything that went before, we're capturing, and you just don't have that in this case. So you thought they did it by saying anything that arrives out of the company with our company? Well, that doesn't, and that wording is fine to capture everything going forward. That absolutely captures everything from January 1, 2012 going forward. But it didn't say anything, Your Honor, about going back and picking up contract one. Are you relying on the principle of South Carolina law that you can screw ambiguities against the director? I'm not. You're not? I'm not

. I didn't. Yeah. You know, I thought I heard you say there were four reasons why this case is different from Fourth Circuit precedent, and I've only heard I think one so far. I really would like to hear the other three. Yes, sir. Yeah, I guess, ma'am, I'm sorry. Another mistake by me. He pointed out one, and I just made another one. The second, third and fourth reason. Okay. In the other cases that they've cited to you, there is a merger or integration clause. That gets us to the carous notion versus hallmark case. That's in the Levine case. Not present here. If they wanted to go back, and they wanted to capture that first contract, they needed a merger or integration clause that says we're going back. And everything that went before, we're capturing, and you just don't have that in this case. So you thought they did it by saying anything that arrives out of the company with our company? Well, that doesn't, and that wording is fine to capture everything going forward. That absolutely captures everything from January 1, 2012 going forward. But it didn't say anything, Your Honor, about going back and picking up contract one. Are you relying on the principle of South Carolina law that you can screw ambiguities against the director? I'm not. You're not? I'm not. That's the problem. You must not play tennis because you're not allowed to play tennis. That was a beach ball. Go ahead. You argue a case where you were. Well, because I'm afraid that I'm going to get blasted down on reply about how that principle gets overruled about the strong presumption of arbitration. If I say that. But you start with the contract, right? I mean, that's what you've been arguing to us. You start with the contract. But I don't think there is no ambiguity. I mean, there really isn't because when you look at those two contracts, you could look at when you look at them side by side, they look different. They don't even look the same. You don't even have to speak English to know or read English to know that they look fundamentally different. And then when you read them, they certainly read fundamentally different. But I don't want to go back and finish answering your honors question. The third thing is the relationship in some of those other cases that they have cited, the relationship of the parties contractually stayed the same. You saw that, for example, in the Levine case, which by the way also had the integration clause I was talking about, the merger or integration clause. You saw that in, say, the Christian versus Comcast that they cited, which was a contract for cable television services. And, you know, in that case, cable television services just kept going. The only thing that changed was an arbitration agreement. Well, not so here

. That's the problem. You must not play tennis because you're not allowed to play tennis. That was a beach ball. Go ahead. You argue a case where you were. Well, because I'm afraid that I'm going to get blasted down on reply about how that principle gets overruled about the strong presumption of arbitration. If I say that. But you start with the contract, right? I mean, that's what you've been arguing to us. You start with the contract. But I don't think there is no ambiguity. I mean, there really isn't because when you look at those two contracts, you could look at when you look at them side by side, they look different. They don't even look the same. You don't even have to speak English to know or read English to know that they look fundamentally different. And then when you read them, they certainly read fundamentally different. But I don't want to go back and finish answering your honors question. The third thing is the relationship in some of those other cases that they have cited, the relationship of the parties contractually stayed the same. You saw that, for example, in the Levine case, which by the way also had the integration clause I was talking about, the merger or integration clause. You saw that in, say, the Christian versus Comcast that they cited, which was a contract for cable television services. And, you know, in that case, cable television services just kept going. The only thing that changed was an arbitration agreement. Well, not so here. When you fundamentally change the contractual relationship of the employees, when they go from 1099 independent contractors to W2 employees, when they go from no taxes being withheld, no employer match on social security to all that stuff happening. That's sort of another kind of class of cases, fundamentally different than what we have here today. And then the final thing, the fourth point I would make, would be where you have two contracts in time, like we have here today. Contract one without an arbitration clause. Contract two with an arbitration clause. And what you see in those kinds of cases is where contract two in its terms, contemplates, there will be a contract one contemplates, there will be a contract two. You saw that in the Drew's case, you saw that in the American Recovery case. You don't see that here today. If the defendant had incorporated by reference the earlier agreement into the later agreement, they'd be on solid ground, wouldn't they? They would be on solid ground as to that. They would not be on solid ground because... As to the enforceability. I understand. Because that's what they're really asking, may I finish answering your honors question? I'll say I'm out of time. That's really what they're asking this court to do today. They're asking you to rewrite contracts for them. They're asking you to do a couple of things. Re-write and add a merger integration clause. And rewrite and take out the parts that limit our statutory damages. And Judge Gregory, you said it best in the prior oral argument

. When you fundamentally change the contractual relationship of the employees, when they go from 1099 independent contractors to W2 employees, when they go from no taxes being withheld, no employer match on social security to all that stuff happening. That's sort of another kind of class of cases, fundamentally different than what we have here today. And then the final thing, the fourth point I would make, would be where you have two contracts in time, like we have here today. Contract one without an arbitration clause. Contract two with an arbitration clause. And what you see in those kinds of cases is where contract two in its terms, contemplates, there will be a contract one contemplates, there will be a contract two. You saw that in the Drew's case, you saw that in the American Recovery case. You don't see that here today. If the defendant had incorporated by reference the earlier agreement into the later agreement, they'd be on solid ground, wouldn't they? They would be on solid ground as to that. They would not be on solid ground because... As to the enforceability. I understand. Because that's what they're really asking, may I finish answering your honors question? I'll say I'm out of time. That's really what they're asking this court to do today. They're asking you to rewrite contracts for them. They're asking you to do a couple of things. Re-write and add a merger integration clause. And rewrite and take out the parts that limit our statutory damages. And Judge Gregory, you said it best in the prior oral argument. We can't rewrite contracts. You said it in the prior oral argument. And so all we're asking today is that the court not rewrite contracts. Thank you. All right. Thank you. Mr. Carver, will you have some time? Resurrect. Thank you, Your Honor. I heard a lot of arguments about the enforceability of the agreement. But I think Judge Thacker got it correctly. That that's not been presented to the court. It wasn't presented to the district court. It's certainly not presented to this court either. So I don't believe that's the proper issue before the court at this point. I think we are actually talking about this. You can just farm on different grounds, can't we? You can affirm on those grounds that have been raised at the district court level. At this point, there's been no complaint whatsoever as to the enforceability of the agreement beyond what has been brought. Beyond what I just heard an oral argument today. I do think that if that issue was briefed, I think it would be clear that this arbitration clause is enforceable. Moving on to the issue that I think is properly before the court, which is the scope of the arbitration provision

. We can't rewrite contracts. You said it in the prior oral argument. And so all we're asking today is that the court not rewrite contracts. Thank you. All right. Thank you. Mr. Carver, will you have some time? Resurrect. Thank you, Your Honor. I heard a lot of arguments about the enforceability of the agreement. But I think Judge Thacker got it correctly. That that's not been presented to the court. It wasn't presented to the district court. It's certainly not presented to this court either. So I don't believe that's the proper issue before the court at this point. I think we are actually talking about this. You can just farm on different grounds, can't we? You can affirm on those grounds that have been raised at the district court level. At this point, there's been no complaint whatsoever as to the enforceability of the agreement beyond what has been brought. Beyond what I just heard an oral argument today. I do think that if that issue was briefed, I think it would be clear that this arbitration clause is enforceable. Moving on to the issue that I think is properly before the court, which is the scope of the arbitration provision. And I hear opposing counsel over and over again. Why would it be enforceable? I mean, I realize he just brought it up today. But what would be your response about his point that you can't take away statutorily guaranteed rights? Well, two points are on or one. I don't believe that the contract itself takes away statutorily rights. The contract itself says that punitive damages, the arbitrator can't award punitive damages that aren't measured by a party's actual damages. And both the FLSA and the South Carolina wage claim that have been brought in this particular case. The so-called punitive damages or liquidated damages would be measured by the party's actual damages. For the FLSA, essentially a double damaged provision in under the South Carolina wage law, a triple damage component. So I don't think that the contract itself does that. But more importantly, the courts are clear that those are issues for the arbitrator to decide as to number one, whether or not the arbitrator is not bound by the agreement to the extent that it would take away statutorily rights. And the courts have been clear that they will compel arbitration and give some discretion to the arbitrator to enforce the party's statutorily rights, whether they be attorneys, fees or some part of liquidated damages. So you want to concede as a representative of the client right now that everything that the statute says, the best of the fact, allows you to concede it, you will allow arbitration to award if the public is at the United States of the United States. But you're not going to argue at all that they're limited in all from what the statute of rights is. Absolutely, Your Honor. In fact, we've done that in other cases and other district courts throughout the country. And I would have done it in this case had it been presented to the district court. I'll tell you, Your Honor, like I would the district court that cellular sales has no intention of taking away a party's statutory rights, whether it's- That included the right to a collective action. The right to collective action, my client will not- my client takes a position that it is a valid collective action waiver. And the Supreme Court has recently come down with opinions that indicate that- that have held that collective action waivers even in the FLSA context are- What case was that? That's what you were going to call me on at your honor? No, no, that's- I believe it's the American Express case. And if I could remember the- the other party I would say it's the American Express case. Well, that's class action

. And I hear opposing counsel over and over again. Why would it be enforceable? I mean, I realize he just brought it up today. But what would be your response about his point that you can't take away statutorily guaranteed rights? Well, two points are on or one. I don't believe that the contract itself takes away statutorily rights. The contract itself says that punitive damages, the arbitrator can't award punitive damages that aren't measured by a party's actual damages. And both the FLSA and the South Carolina wage claim that have been brought in this particular case. The so-called punitive damages or liquidated damages would be measured by the party's actual damages. For the FLSA, essentially a double damaged provision in under the South Carolina wage law, a triple damage component. So I don't think that the contract itself does that. But more importantly, the courts are clear that those are issues for the arbitrator to decide as to number one, whether or not the arbitrator is not bound by the agreement to the extent that it would take away statutorily rights. And the courts have been clear that they will compel arbitration and give some discretion to the arbitrator to enforce the party's statutorily rights, whether they be attorneys, fees or some part of liquidated damages. So you want to concede as a representative of the client right now that everything that the statute says, the best of the fact, allows you to concede it, you will allow arbitration to award if the public is at the United States of the United States. But you're not going to argue at all that they're limited in all from what the statute of rights is. Absolutely, Your Honor. In fact, we've done that in other cases and other district courts throughout the country. And I would have done it in this case had it been presented to the district court. I'll tell you, Your Honor, like I would the district court that cellular sales has no intention of taking away a party's statutory rights, whether it's- That included the right to a collective action. The right to collective action, my client will not- my client takes a position that it is a valid collective action waiver. And the Supreme Court has recently come down with opinions that indicate that- that have held that collective action waivers even in the FLSA context are- What case was that? That's what you were going to call me on at your honor? No, no, that's- I believe it's the American Express case. And if I could remember the- the other party I would say it's the American Express case. Well, that's class action. It's a class action. Collective action is not a class action. It's similar. And the argument in the American Express case was exactly that it prohibits a party from vindicating their statutory rights. And the court said that the- if the FLSA had- the court said that by prohibiting collective action you're not prohibiting the individuals from pursuing their own individual rights, which is what the FLSA was there to protect. So I think the American Express case stands for that proposition. But if I could just briefly your honor address the scope issue because I don't think- I hear arguments about we needed to put an integration clause in our contract in order to make the claims that my client thinks are subject to arbitration- Arbitrable. And I don't believe that's the case because the fourth circuit has found that. And I'm quoting from the DuPont- Amp-Dil case from 290-607- The Claim for Arbitration will suffice to preclude a claim from going to arbitration. So I think it's the reverse of what opposing council said in this case. It's not that we need to demonstrate that some other claim is within the arbitration clause. But more importantly, did we do anything to exclude particular claims from the arbitration clause? And I don't think that's the case. I think the arbitration clause encompasses the entire employment relationship, whether it be pre or post- January 1st 2012, and the port parties did nothing to exclude any time, any claims prior to that time. There simply was no temporal limitation on the- So let me see if I have this straight. Your argument is these two plaintiffs were employees of a separate company before January 1st. Their respective companies had agreements with your client. January 1st comes and now your client hires the former employees of a different company. And under their appointment agreement, they have to arbitrate even though you never call them employees before January 1st. And in fact, they were employees of a different company. I think I've fairly summarized your position, right? You did, Your Honor. I may have stated in a bit of a different way if I could, is that had these two plaintiffs brought claims based on their independent contract or relationship under the independent contract or sales agreement that they had with my client? In other words, if they had alleged, for example, that they were- That their LLC and your client were the joint together constituted a joint employer

. It's a class action. Collective action is not a class action. It's similar. And the argument in the American Express case was exactly that it prohibits a party from vindicating their statutory rights. And the court said that the- if the FLSA had- the court said that by prohibiting collective action you're not prohibiting the individuals from pursuing their own individual rights, which is what the FLSA was there to protect. So I think the American Express case stands for that proposition. But if I could just briefly your honor address the scope issue because I don't think- I hear arguments about we needed to put an integration clause in our contract in order to make the claims that my client thinks are subject to arbitration- Arbitrable. And I don't believe that's the case because the fourth circuit has found that. And I'm quoting from the DuPont- Amp-Dil case from 290-607- The Claim for Arbitration will suffice to preclude a claim from going to arbitration. So I think it's the reverse of what opposing council said in this case. It's not that we need to demonstrate that some other claim is within the arbitration clause. But more importantly, did we do anything to exclude particular claims from the arbitration clause? And I don't think that's the case. I think the arbitration clause encompasses the entire employment relationship, whether it be pre or post- January 1st 2012, and the port parties did nothing to exclude any time, any claims prior to that time. There simply was no temporal limitation on the- So let me see if I have this straight. Your argument is these two plaintiffs were employees of a separate company before January 1st. Their respective companies had agreements with your client. January 1st comes and now your client hires the former employees of a different company. And under their appointment agreement, they have to arbitrate even though you never call them employees before January 1st. And in fact, they were employees of a different company. I think I've fairly summarized your position, right? You did, Your Honor. I may have stated in a bit of a different way if I could, is that had these two plaintiffs brought claims based on their independent contract or relationship under the independent contract or sales agreement that they had with my client? In other words, if they had alleged, for example, that they were- That their LLC and your client were the joint together constituted a joint employer. Under federal law, you know, we have lots of law about who is a joint employer. Then you would say what? In that particular case- That would have been okay. I don't think that would be okay because they're still making the allegation that they were an employee of my client. So under no circumstances, once they signed those January 1st agreements, could they ever sue your client for anything? No, that's absolutely not my position, not for the company's position. They could sue my client for anything related to the independent contract or relationship, anything in connection with the sales agreement that they signed. There was a prior contract with the sales contract- So like breach of contract for non-payment of- The commissions or something? The contract itself has various provisions and it includes compensation issues. And what do you say about drafting ambiguities against the draft or interpreting ambiguities against the draft? I don't believe that applies in this case because I think the FAA in the case is interpreting the FAA, give a strong presumption to arbitration of claims. And in this particular case, because these, the claims that have been asserted in this case and the language that the court uses, does it touch matters that would invoke the arbitration provision? And I think without question, you're on the allegation of an employment relationship. Prior to January 1st, 2012, necessarily touch matters that are in contact- But do you agree, do you not, that whether there's a contract for arbitration is a matter of state law? The interpretation is a matter of state law, that's pretty true. And you agreed that South Carolina has this canon that says ambiguities are construed in favor against the draft. I would agree that that's a- But your argument is that the FAA somehow trumps or preamps that state court dot, that state law dot. If it doesn't preempt at your honor, then it certainly is something that needs to be read in conjunction with the South Carolina state common law with respect to the draft. And the draft, the provision against the, to interpreting the provision against the draft. I don't think that you can isolate an interpretation of an arbitration provision looking solely to state law without looking at also the FAA in the cases interpreting the FAA. Because most importantly, in this particular case, the parties agreed that the FAA would control. So I think, I don't think you can look at it in isolation and interpret it against the draft without looking at it that way as well, Your Honor. Thank you very much. We'll come down to Greek Council and proceed to our final.

Carbo? Well, you ready. Thank you, Your Honor May, please the Court, Larry Carbo and Paige, Kaelish, for the appellate cellular sales of Knoxville and cellular sales of South Carolina. Now, what this case comes down to is two plaintiffs that seek the benefits of employment, but do not want the consequences of that employment. And what I'd like to do initially is give a little bit of background here as to the relationship between cellular sales and these two plaintiffs in connection with their employment relationship and a prior independent contractor relationship. And I think that's important because I don't believe that I did a very good job doing that before the district court because I think the district court entered an order that maybe indicated that there was some misunderstanding as to the prior relationship. So if I could, cellular sales is a company that has a contract with Verizon to sell the Verizon Wireless Service in various states throughout the country, including South Carolina. Prior to January 1st, 2012, cellular sales did not have employees as sales representatives to sell this service. Although the plaintiffs allege that they facto, they were employees. That is what the plaintiffs allege, which is why we're here today. They bring the FLSA claim. That's absolutely correct, Your Honor. The argument that the plaintiffs have, both of the claims that they bring in this lawsuit are claims that necessarily require that they are employees. So to prevail on those claims, they will have to demonstrate that in fact they were employees, which gets us to the compensation agreement that each of these individuals signed when they became employees of the company. They signed the agreement on January 1st, 2012. Cellular sales made a global change to the way it was conducting its business in January of 2012, and as part of that decided to actually hire sales representatives as opposed to contracting with sales companies. Now there's no dispute, at least from my client's perspective, that prior to January 1st, 2012, these individuals were not employees of the company. They had... So you say there's no dispute. Of course there's a dispute. The plaintiffs, the last day were the fact they were employees. My client's position has always been that they were not employees until January 1st, 2012. These two individuals were employees of their own company that contracted with Cellular sales. Right, and that's the dispute. Exactly, Your Honor. So if I could turn then to the compensation agreement here in the arbitration clause that is at issue is, I think it's important to look at the language of that contract because of the district court's ruling, because the contract itself does not limit the arbitrable claims to those claims arising from the compensation agreement. In fact, it's very clear that it says it's claims disputes or controversies that arise out of the document, the document being the compensation agreement that they signed in January of 2012, or the employee's employment with the company. So that or there necessarily means that there's something else besides... What's the company? What's the company? The company is Cellular sales, Your Honor. Right, and that existed at the same time they signed that document. There was no pre-existing employment with the company before that. That's your position. They were employees. They were not employees before the time they signed that document. There was no pre-existing employment relationship with them in your company. Their relationship was with their sales company. Right? Absolutely, Your Honor. Okay, so what you want to do is you want to make an arbitration clause not only be its possible retroactivity, but you want one where it makes someone susceptible to an arbitration. They weren't even parties before that time. That's absolutely correct, Your Honor. If I can explain why I think that in this particular case it's appropriate. I think it's appropriate because if we assume for a moment that these individuals were employees prior to January 1st, 2012, which is what the plaintiffs will ultimately have to prove to the court. I'm sorry to interrupt, but why would we assume that? Because they don't have to assume anything. In order for the plaintiffs to prevail in this case, there will have to be a finding that they were employees. They will have to be a finding, exactly. But we don't have to assume anything. We don't make findings up here. That's a role of the trial judge. But for purposes of whether or not the court should compel arbitration, you have to look at the pleading itself. If you look at the plaintiffs complaint and you go through the plaintiffs complaint, throughout the complaint they allege that they were employees prior to January 1st, 2012. Which is why we don't have to assume it. That's what we look to at this point. You look at the complaint. That is correct, Your Honor. The complaint itself specifically says or alleges that the plaintiffs in this particular case were employees at all times prior to January 1st, 2012 and at times after January 1st, 2012. There's no, the plaintiffs make that consider. You're referring to the now in operative complaint. No, Your Honor. I'm referring to the amended complaint. The amended complaint, which is the complaint that the district court entered its order denying the most to compel arbitration on. The district court looked at the amended complaint and looked at the amended complaint. All it did was to carve out any claims after January 1st, 2012 when the conversion occurred. Exactly. And that's why I'm sorry. I really don't mean to keep interrupting you, but you said you alluded to allegations about post January 1st, but the plaintiffs have essentially abandoned any claim purportedly arising after January 1st. They do abandon their claims after January 1st, 2012, but they don't abandon their claims that they were in fact employees prior to January 1st, 2012. Exactly. In fact, in their complaint, they continue to take the position that they were employees prior to January 1st, 2012. Right. And what I was trying to explain before is if these people were employees prior to January 1st, 2012, and they would have signed this compensation agreement on January 1st, 2012 that had the arbitration provision and had there not been an arbitration provision before that, I think the fourth circuit is clear that that would be retroactively applied to these individuals pre-January 1st, 2012 relationship. So if we look at how this plays out with the allegations in the complaint, which is what we have to rely upon, these individuals are saying that they were employees. If they were employees prior to January 1st, 2012, it doesn't matter under fourth circuit law that they didn't sign an agreement to arbitrate their claims until January 1st, 2012. You're not using this language, but it really sounds like you're arguing some form of judicialist stopper or something. I understand retroactivity, and certainly this court and the Supreme Court have been very willing to find retroactivity when it comes to sort of intervening arbitration clauses. But here we have very different facts. We have on the ground real facts that these plaintiffs were employees of their own LLCs. Now for purposes of the FLSA claims, they allege that they were de facto employees and should have been treated as employees for wage purposes by your client. But that's a far cry from the counterfactual hypothetical you just articulated, which was suppose they'd never had an LLC before January 1st. Then they signed these contracts requiring arbitration. I think you'd win. I think you would have won below. I think that the district court would have said, well, under fourth circuit law, it's a look back in a look forward when you insert an arbitration clause into an agreement midstream. But that's not what happened here. It's absolutely not what happened here. And I would agree with your honor that that would certainly make it a much easier case for my clients' perspective. It makes it a very different case. I don't know that it's a very different case. I can't agree that it's a very different case because I don't believe that what the district court had to do in connection with determining whether or not these claims were subject to the arbitration is to look to the complaint itself. And if you look to the complaint itself, the allegations of employment is what triggers the arbitration clause in this particular case. Or is it? No. Obitration clause comes by contract agreement, right? That's correct, your honor. All right. Now, it is undisputed. You get about allegations. We don't need allegations when it's undisputed. It's undisputed as in terms of contractual standpoint. They were employed by a sales company. They had no contract with your company, correct? That's the amount of law. That's correct. Prior to January 1st, 2012, the individuals did not. All right. We get about what they alleged because you both kind of talk about both sides of your market, not employees, our employees, all kind of things. But with that case, isn't this case more than retroactivity? I think Judge Davis was in terms of laying out in terms of this intervening. You were asking for retroactivity and you want to apply it with the part of you want to have it enforced against was not illegal. There was no contract with privity with you. It's different. In other words, you were an employee year before. Now you're an employee now. It's retroactive where you were the same status. But problem here is not only at retroactivity, they were not in contract. They were in contract with your company. And that's not disputed, correct? That's not disputed, Your Honor. But what my client contracted for in January of 2012 when it had these individuals signed the compensation agreement as a condition of their employment was that all employment-related disputes were going to be compelled to arbitration. And in this particular case, they're with the company. With the company. That's correct, Your Honor. But you made the choice of the word. You should have said, not this employment with you. Whatever position you were in prior. In other words, when you said with the company, legally they were not employed by your company. But the dispute that we're litigating is now an employment-related dispute with the company. The claim is being brought against the company. My client contracted in January of 2012 that those types of claims, any claim related to employment-related claims, are going to be compelled to arbitration. So at some point, if in fact the plaintiffs are successful in proving that they were not independent contractors and were misclassified, there is going to be an employment-related dispute because it's necessarily an FLSA and a South Carolina wage claim that the court will have to consider. So I don't know that the prior relationship, while it certainly muddies the waters a bit in this particular case, at some point this is an employment-related dispute. I do that everyone agreed was going to be subject to arbitration. And I'll reserve the rest of my time. Thank you, Your Honor. Thank you so much. Mr. Doxan. Thank you, Your Honor. May it please the court, Robert Dodson for the appellate, Dan Newbanks, and Jenny Walton. The issues before this court are simple and straightforward issues. First, can a party be compelled to arbitrate claims they did not agree to arbitrate? And the second issue is can the court enforce an arbitration agreement that not only forces arbitration on the plaintiffs, but also attempts in the wording of that very arbitration agreement to rip away from the plaintiffs, statutorily guaranteed rights under federal statute. The answer to both of those questions is no. The answer no was reached by the district court on the first issue, and it should be affirmed here today. The appellate's argument to this court on this first issue, that whether the arbitration clause that issue applies, must be based on the allegations of the claim, is off base and wrong. That is not the law on the circuit, that is not the law in the United States. In making this argument, what the appellate is doing is taking a legal standard, a legal standard, to a private contract, and you simply can't do that. Ironically enough. Your claim is that the appellees are employees, so they are entitled to certain wage and our considerations. That's your claim, correct? That's what we need to look to now. So how is that not an employee related dispute when we're to look at the very broad language of the arbitration clause here and the law favors arbitration? I'm glad that you asked the question, Your Honor, and I'm glad that you asked because the point that I want to make to this court is this, for the purposes of our complaint, whether that be the original complaint or the amended complaint. Right, they're the same. When we plead in our complaint that they violated the Fair Labor Standards Act, what we are saying to the court is, court, we get, we meet the legal standard set forth for employee under the Fair Labor Standards Act. We meet that standard, and therefore we get the protections afforded to us under that standard. Right, you want the protections of that statute. I mean, I don't know how a Fair Labor Standards Act complaint is not an employee related dispute. So you want the protections of that statute, but then you don't, you want to have your cake and eat it too, you don't want arbitration for this employee related dispute. We don't, Your Honor, we respectfully don't, and this is why, because when we plead, we are pleading as to the merits of our case that we meet the standard, okay? But when it comes to the FAA, what this court has always focused on is the contracts, not so at all, not so at all, with regard to the Fair Labor Standards Act, okay? Under the Fair Labor Standards Act, what the parties contract for doesn't matter. There is a different standard set forth under the Fair Labor Standards Act than there is for purposes of the FAA. In fact, doesn't the Fair Labor Standards Act actually prohibit forfeiture of the benefits and rights under that statute? Absolutely. For those unique federal statutes that says the person can't sign away these rights. That is absolutely correct, Your Honor, and that goes to the second issue that I raised. It's not to say, I'm sorry, but it's not to say you can't arbitrate those rights. That's right. If you can't sign them away. That is absolutely right. Under both the FAA and the Fair Labor Standards Act, when you take those two acts together and you take the case law together, what you can do is you can agree to change the venue or change the forum. Where you resolve disputes under the Fair Labor Standards Act. But you can't prospectively wave your statutorily guaranteed rights under the Fair Labor Standards Act. Would you have a collective action right under the arbitration clause in this case? I don't remember what it said. If we just looked at the arbitration clause itself, could we bring a class action under the arbitration clause if that was an enforceable clause which I'm going to argue that it was not. I understand. But no. I believe that it says, and it's on page 70, the joint of business. You can't bring a collective action. It says you can't bring a class out. But it goes beyond that, Your Honor. It goes far beyond that. Because it goes on to say, among other things, that we can't recover statutorily, we can't recover statutorily damages. The Fair Labor Standards Act says we can get liquidated damages. The Fair Labor Standards Act says we can get attorneys fees if we prevail. But under this arbitration agreement, it says that we can't do that. It says that parties agree that no arbitrator has the authority to award punitive damages or other damages not measured by the prevailing parties actual damages. Judge, you can't do that. I mean, you can't do that. I mean, they can't do that. You said, Judge, you could do anything you want to. Well, that's not true. Congress makes that clear. But humor aside, they can't do that. Can I ask you this? Yes, sir. Have you all proceeded yet in the district court to identify the members of the class here, the collective action? We have not. Things have just stopped pending appeal. What happened? What's your estimate of how many members are going to be in the class today? I would estimate several hundred. Several hundred. But that is... So if it's a willful violation, it's a three-year look-back, we're talking about some real money here potentially. We're talking about some significant money. And the estimate I gave you is, I'm really just... I'm guessing. I mean, I really am guessing. But to answer your question, we think it's several hundred, maybe over a thousand. I don't know. But my point earlier was that... And I want to be clear, Your Honor, we didn't do a good job briefing this. We did not do a good job briefing. The issue of what is the arbitration clause actually, say, aside from the employee, you know, beginning beyond that part of the arbitration. And that's why I want to make clear to the court here today. You simply can't enforce this arbitration clause because it's not just an arbitration clause. It's a lot more than that. It attempts to rip away statutory rights that Congress has afforded to the plaintiffs. And that's why I was saying to Your Honor's question earlier, when you asked about employee and doesn't this involve an employment dispute, that's why I was saying earlier to that question that when we make legal pleadings, what we are saying to the court is, we meet the standard of the statute that we're suing on. We meet that standard, okay? Because in the law, there are different standards, even in this area of labor and employment law. There are different standards. There are different legal tests. There are different legal definitions of employee, employer, independent contractor. Okay. And for purposes of the FAA, that doesn't matter because under this circuit's FAA law, what matters is how the party is contracted. What governs is how they contracted. Well, how they contracted changed pretty radically because what they contracted for prior to January, 2012, was a relationship of independent contractor. And that changed after that. They get to define their relationship for purposes of the FAA. That's what the FAA does. It encourages the parties, or if it doesn't encourage it, at least allows the parties, to contract for what they want to contract for with regard to arbitration. It allows them to arbitrate disputes as opposed to litigating disputes. And they can contractually agree to any relationship that they are. You don't limit the FAA's reach to just labor and employment issues. I mean, it can have all kinds of far-reaching implications, contractor with subcontractor, and a whole host of variety of other things. That's what that act allows. But with regard to the Fair Labor Standards Act, that's a different legal standard altogether. And the standard there is an economic reality standard. Well, look, in this area of law, we get into this issue in tort law, too, with regard to the doctrine of responding out superior. We get into this, and we say that in order to prove a responding out superior, you have to show that the alleged employer had actual control of the manner of performance. Well, that's a different standard than what the parties contracted for here. That's a different standard than what the Fair Labor Standards Act applies. Are you on the preemption? No, no, sir. No, sir. You know how it is preemptive? No, no, sir. Not at all, sir. But again, take another example. So you agree, otherwise, that retroactivity could occur if these were employees, and just later hit them. There is no question that this circuit, and they've sided a host of cases for you, there's no question that this circuit has retroactively applied arbitration agreements. No question about that. All right, now, the cases that they've sided to you differ in four significant ways. First of all, they differ because in every one of those cases, every one of the cases they sided for to you. They didn't, they, the parties agreed to arbitrate, but that didn't change the underlying rights that they were disputing. They didn't try to rip away statutorily guaranteed rights in any of those cases, because you simply can't do that, your honor, and all of those cases are different, because all of those cases were essentially, we agreed to arbitrate. We agreed to arbitrate. We agreed to arbitrate. But this arbitration clause that's now before this court went far beyond that, because it took away statutorily guaranteed rights, and the district court never reached that issue, because the district court simply concluded the plaintiffs are going to limit themselves to prior to January 2012, so that, that essentially resolved the issue. But it's certainly relevant here today, because when you look at the Supreme Court, and what the Supreme Court has said about this, they said in the Gilmer versus Interstate slash Johnson case, this is a quote, in dealing with an ADA playing, so long as the prospective litigant effectively may vindicate his or her statutory cause of action in the arbitration forum, the statute, meaning the ADA, will continue to serve both its remedial and deterrent function. But that reasoning and that logic applies equally to FLSA claims. And in fact, this court, and I didn't cite these cases in my brief, and I apologize for that. But in two cases from this court, in the on-ray cotton yarn, antitrust litigation, and in the POTE versus Rich Products Corporation case, relying on Supreme Court precedent in this area, the court said you cannot, through an arbitration clause, prospectively limit the damages that are statutorily guaranteed to appoint... Sounds like you're arguing that you regret your amended complaint. I don't regret it, no, sir. I don't regret it at all. Sounds like you're saying, I, now that you've thought about it, and I don't mean this is criticism, it's a analogy you've thought about it, seems like maybe you should have persisted in the post-January 1st claim as well. Well... And maybe you'll do that when and if the case goes back. Yeah, maybe so, Your Honor. Because hindsight is 2020. Wisdom, when you see... I will tell you what I do regret. What I do regret is not bringing this issue to the forefront with the district court, and what I do regret is not better briefing that issue before the court day. Yeah, you didn't do it until standing here right now. I didn't. Yeah. You know, I thought I heard you say there were four reasons why this case is different from Fourth Circuit precedent, and I've only heard I think one so far. I really would like to hear the other three. Yes, sir. Yeah, I guess, ma'am, I'm sorry. Another mistake by me. He pointed out one, and I just made another one. The second, third and fourth reason. Okay. In the other cases that they've cited to you, there is a merger or integration clause. That gets us to the carous notion versus hallmark case. That's in the Levine case. Not present here. If they wanted to go back, and they wanted to capture that first contract, they needed a merger or integration clause that says we're going back. And everything that went before, we're capturing, and you just don't have that in this case. So you thought they did it by saying anything that arrives out of the company with our company? Well, that doesn't, and that wording is fine to capture everything going forward. That absolutely captures everything from January 1, 2012 going forward. But it didn't say anything, Your Honor, about going back and picking up contract one. Are you relying on the principle of South Carolina law that you can screw ambiguities against the director? I'm not. You're not? I'm not. That's the problem. You must not play tennis because you're not allowed to play tennis. That was a beach ball. Go ahead. You argue a case where you were. Well, because I'm afraid that I'm going to get blasted down on reply about how that principle gets overruled about the strong presumption of arbitration. If I say that. But you start with the contract, right? I mean, that's what you've been arguing to us. You start with the contract. But I don't think there is no ambiguity. I mean, there really isn't because when you look at those two contracts, you could look at when you look at them side by side, they look different. They don't even look the same. You don't even have to speak English to know or read English to know that they look fundamentally different. And then when you read them, they certainly read fundamentally different. But I don't want to go back and finish answering your honors question. The third thing is the relationship in some of those other cases that they have cited, the relationship of the parties contractually stayed the same. You saw that, for example, in the Levine case, which by the way also had the integration clause I was talking about, the merger or integration clause. You saw that in, say, the Christian versus Comcast that they cited, which was a contract for cable television services. And, you know, in that case, cable television services just kept going. The only thing that changed was an arbitration agreement. Well, not so here. When you fundamentally change the contractual relationship of the employees, when they go from 1099 independent contractors to W2 employees, when they go from no taxes being withheld, no employer match on social security to all that stuff happening. That's sort of another kind of class of cases, fundamentally different than what we have here today. And then the final thing, the fourth point I would make, would be where you have two contracts in time, like we have here today. Contract one without an arbitration clause. Contract two with an arbitration clause. And what you see in those kinds of cases is where contract two in its terms, contemplates, there will be a contract one contemplates, there will be a contract two. You saw that in the Drew's case, you saw that in the American Recovery case. You don't see that here today. If the defendant had incorporated by reference the earlier agreement into the later agreement, they'd be on solid ground, wouldn't they? They would be on solid ground as to that. They would not be on solid ground because... As to the enforceability. I understand. Because that's what they're really asking, may I finish answering your honors question? I'll say I'm out of time. That's really what they're asking this court to do today. They're asking you to rewrite contracts for them. They're asking you to do a couple of things. Re-write and add a merger integration clause. And rewrite and take out the parts that limit our statutory damages. And Judge Gregory, you said it best in the prior oral argument. We can't rewrite contracts. You said it in the prior oral argument. And so all we're asking today is that the court not rewrite contracts. Thank you. All right. Thank you. Mr. Carver, will you have some time? Resurrect. Thank you, Your Honor. I heard a lot of arguments about the enforceability of the agreement. But I think Judge Thacker got it correctly. That that's not been presented to the court. It wasn't presented to the district court. It's certainly not presented to this court either. So I don't believe that's the proper issue before the court at this point. I think we are actually talking about this. You can just farm on different grounds, can't we? You can affirm on those grounds that have been raised at the district court level. At this point, there's been no complaint whatsoever as to the enforceability of the agreement beyond what has been brought. Beyond what I just heard an oral argument today. I do think that if that issue was briefed, I think it would be clear that this arbitration clause is enforceable. Moving on to the issue that I think is properly before the court, which is the scope of the arbitration provision. And I hear opposing counsel over and over again. Why would it be enforceable? I mean, I realize he just brought it up today. But what would be your response about his point that you can't take away statutorily guaranteed rights? Well, two points are on or one. I don't believe that the contract itself takes away statutorily rights. The contract itself says that punitive damages, the arbitrator can't award punitive damages that aren't measured by a party's actual damages. And both the FLSA and the South Carolina wage claim that have been brought in this particular case. The so-called punitive damages or liquidated damages would be measured by the party's actual damages. For the FLSA, essentially a double damaged provision in under the South Carolina wage law, a triple damage component. So I don't think that the contract itself does that. But more importantly, the courts are clear that those are issues for the arbitrator to decide as to number one, whether or not the arbitrator is not bound by the agreement to the extent that it would take away statutorily rights. And the courts have been clear that they will compel arbitration and give some discretion to the arbitrator to enforce the party's statutorily rights, whether they be attorneys, fees or some part of liquidated damages. So you want to concede as a representative of the client right now that everything that the statute says, the best of the fact, allows you to concede it, you will allow arbitration to award if the public is at the United States of the United States. But you're not going to argue at all that they're limited in all from what the statute of rights is. Absolutely, Your Honor. In fact, we've done that in other cases and other district courts throughout the country. And I would have done it in this case had it been presented to the district court. I'll tell you, Your Honor, like I would the district court that cellular sales has no intention of taking away a party's statutory rights, whether it's- That included the right to a collective action. The right to collective action, my client will not- my client takes a position that it is a valid collective action waiver. And the Supreme Court has recently come down with opinions that indicate that- that have held that collective action waivers even in the FLSA context are- What case was that? That's what you were going to call me on at your honor? No, no, that's- I believe it's the American Express case. And if I could remember the- the other party I would say it's the American Express case. Well, that's class action. It's a class action. Collective action is not a class action. It's similar. And the argument in the American Express case was exactly that it prohibits a party from vindicating their statutory rights. And the court said that the- if the FLSA had- the court said that by prohibiting collective action you're not prohibiting the individuals from pursuing their own individual rights, which is what the FLSA was there to protect. So I think the American Express case stands for that proposition. But if I could just briefly your honor address the scope issue because I don't think- I hear arguments about we needed to put an integration clause in our contract in order to make the claims that my client thinks are subject to arbitration- Arbitrable. And I don't believe that's the case because the fourth circuit has found that. And I'm quoting from the DuPont- Amp-Dil case from 290-607- The Claim for Arbitration will suffice to preclude a claim from going to arbitration. So I think it's the reverse of what opposing council said in this case. It's not that we need to demonstrate that some other claim is within the arbitration clause. But more importantly, did we do anything to exclude particular claims from the arbitration clause? And I don't think that's the case. I think the arbitration clause encompasses the entire employment relationship, whether it be pre or post- January 1st 2012, and the port parties did nothing to exclude any time, any claims prior to that time. There simply was no temporal limitation on the- So let me see if I have this straight. Your argument is these two plaintiffs were employees of a separate company before January 1st. Their respective companies had agreements with your client. January 1st comes and now your client hires the former employees of a different company. And under their appointment agreement, they have to arbitrate even though you never call them employees before January 1st. And in fact, they were employees of a different company. I think I've fairly summarized your position, right? You did, Your Honor. I may have stated in a bit of a different way if I could, is that had these two plaintiffs brought claims based on their independent contract or relationship under the independent contract or sales agreement that they had with my client? In other words, if they had alleged, for example, that they were- That their LLC and your client were the joint together constituted a joint employer. Under federal law, you know, we have lots of law about who is a joint employer. Then you would say what? In that particular case- That would have been okay. I don't think that would be okay because they're still making the allegation that they were an employee of my client. So under no circumstances, once they signed those January 1st agreements, could they ever sue your client for anything? No, that's absolutely not my position, not for the company's position. They could sue my client for anything related to the independent contract or relationship, anything in connection with the sales agreement that they signed. There was a prior contract with the sales contract- So like breach of contract for non-payment of- The commissions or something? The contract itself has various provisions and it includes compensation issues. And what do you say about drafting ambiguities against the draft or interpreting ambiguities against the draft? I don't believe that applies in this case because I think the FAA in the case is interpreting the FAA, give a strong presumption to arbitration of claims. And in this particular case, because these, the claims that have been asserted in this case and the language that the court uses, does it touch matters that would invoke the arbitration provision? And I think without question, you're on the allegation of an employment relationship. Prior to January 1st, 2012, necessarily touch matters that are in contact- But do you agree, do you not, that whether there's a contract for arbitration is a matter of state law? The interpretation is a matter of state law, that's pretty true. And you agreed that South Carolina has this canon that says ambiguities are construed in favor against the draft. I would agree that that's a- But your argument is that the FAA somehow trumps or preamps that state court dot, that state law dot. If it doesn't preempt at your honor, then it certainly is something that needs to be read in conjunction with the South Carolina state common law with respect to the draft. And the draft, the provision against the, to interpreting the provision against the draft. I don't think that you can isolate an interpretation of an arbitration provision looking solely to state law without looking at also the FAA in the cases interpreting the FAA. Because most importantly, in this particular case, the parties agreed that the FAA would control. So I think, I don't think you can look at it in isolation and interpret it against the draft without looking at it that way as well, Your Honor. Thank you very much. We'll come down to Greek Council and proceed to our final