Poletti v. Pepsi-Cola Bottling Company Of New York, Inc.

Background

The plaintiffs are current or former distributors of Pepsi Co. products. The case concerns their distributor agreements. Seventeen plaintiffs had agreements effective before January 4, 2021, which the court called the “Prior Agreements.” Eleven plaintiffs had agreements effective January 4, 2021, which the court called the “Current Agreements.” Together, the court called them the “Distributor Agreements.”

In a September 6, 2023 Opinion & Order, the court granted the defendants’ motions to compel arbitration. The plaintiffs then moved for reconsideration under Federal Rules of Civil Procedure 59(e) and 60(b) and Local Civil Rule 6.3. The plaintiffs also filed an interlocutory appeal from the earlier order. The Court of Appeals stayed that appeal while the reconsideration motion was pending. A separate motion to stay this case pending the Supreme Court’s decision in Bissonnette v. LePage Bakeries Park St. LLC was terminated as moot after the Supreme Court resolved that case.

The defendants later asked the court to deny reconsideration as to plaintiff Vincent Carrieri, arguing that Carrieri’s submission of a demand for arbitration had made his reconsideration motion moot. Carrieri’s counsel argued that the demand was a protective measure and that the motion was not moot.

Legal standard

Reconsideration is an extraordinary remedy that courts use sparingly. The moving party generally must identify a controlling decision or important information the court overlooked, an intervening change in controlling law, newly available evidence, clear error, or a need to prevent manifest injustice. A reconsideration motion is not a chance to relitigate issues already decided or to present arguments that could have been raised earlier.

Discussion

Arguments about employee classification. The plaintiffs argued that the Distributor Agreements’ provisions describing them as independent contractors and preventing an arbitrator from changing the agreements would keep them from arguing in arbitration that they were employees under the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL).

The court rejected reconsideration on this ground. It had already considered and rejected the argument that the agreements prevented an arbitrator from deciding whether the plaintiffs were employees. In the earlier proceedings, the plaintiffs had argued that deciding their employee status would violate the agreements’ prohibition against changing their terms. The defendants had responded that the arbitration clauses covered the plaintiffs’ misclassification claim. The court concluded that its earlier finding that the arbitration provisions were broad enough to cover the dispute had sufficiently addressed the plaintiffs’ position. Repeating the same argument did not show clear error or manifest injustice.

Arguments about damages under the Current Agreements. The plaintiffs asked the court to invalidate certain arbitration clauses in the Current Agreements if those clauses prevented them from recovering damages under the FLSA or the NYLL. The court declined to consider this argument because the plaintiffs could have raised it during the earlier briefing but did not. Because the plaintiffs possessed the agreements and did not identify new evidence, the court treated the argument as waived for purposes of reconsideration.

**The Supreme Court’s decision in Bissonnette.** The plaintiffs argued that the Supreme Court’s decision in Bissonnette was an intervening change in controlling law and that they were transportation workers exempt from arbitration under Section 1 of the Federal Arbitration Act (FAA). The Supreme Court held that a transportation worker need not work in the transportation industry to fall within that exemption. It did not decide whether the workers in that case satisfied the separate two-part test concerning their work responsibilities and involvement in foreign or interstate commerce.

The court held that Bissonnette did not justify reconsideration here. The earlier order compelled arbitration because the arbitration clauses covered the dispute and held that the defendants had not waived arbitration by waiting one year to move to compel. The earlier order had not addressed whether the plaintiffs were exempt under Section 1 of the FAA because that issue had not been briefed in the motions to compel. Therefore, Bissonnette did not overrule a legal rule on which the earlier order was based and did not otherwise affect that order. The court also noted that the Supreme Court and Second Circuit decisions had not decided whether the plaintiffs in Bissonnette satisfied the two-part test.

Disposition

The court denied the plaintiffs’ motion for reconsideration. It concluded that the plaintiffs had not shown an intervening change in controlling law, newly available evidence, clear error, or manifest injustice. Because the court denied reconsideration, it did not decide the defendants’ request to find Carrieri’s motion moot. The Clerk of Court was directed to terminate the motions at Documents 98 and 123.