## Facts

- Djamel Ouadani worked as a delivery driver performing deliveries arranged by Dynamex Operations East, LLC (later TF Final Mile, LLC).
- Ouadani applied to Dynamex, interviewed at Dynamex’s office, completed onboarding forms, received a company shirt and identification badge, and was directed to pass a drug test.
- Dynamex required drivers to “associate” with a Dynamex-affiliated vendor, Selwyn and Birtha Shipping LLC (SBS), through which Ouadani was paid.
- Dynamex and SBS had an Independent Contractor Agreement containing a mandatory arbitration clause and a requirement that SBS’s subcontractors sign written agreements consistent with its terms.
- Ouadani never signed any agreement with Dynamex or SBS, was not shown the Dynamex–SBS agreement, and did not know it existed.
- After complaining that Dynamex exercised employee-like control and that he should be paid as an employee, Ouadani was terminated.
- Ouadani filed a putative class action alleging misclassification and wage-and-hour violations; TF Final Mile moved to compel arbitration based on the Dynamex–SBS agreement.

## Issues

1. Whether a worker who neither signed nor knew of an arbitration agreement may be compelled to arbitrate based on a contract between the company and a third-party vendor.
2. Whether the worker was bound to arbitrate under federal common-law doctrines of agency.
3. Whether equitable estoppel could require arbitration because the worker allegedly benefited from the company–vendor arrangement.
4. Whether the worker was an intended third-party beneficiary of the company–vendor contract and thus bound by its arbitration clause.

## Decision

- The First Circuit affirmed the order denying the motion to compel arbitration.
- The court held that Ouadani could not be compelled to arbitrate because he did not agree to arbitrate and lacked notice of the arbitration clause.
- The court rejected TF Final Mile’s reliance on agency, equitable estoppel, and third-party-beneficiary theories to bind Ouadani to the company–vendor arbitration clause.

## Legal Principles

- Arbitration under the Federal Arbitration Act is based on consent; courts may not compel arbitration absent an agreement to arbitrate.
- Agency requires a manifestation of consent and authority; a worker is not bound as an “agent” to an arbitration clause in a principal’s contract without evidence of authority or assent, especially where the contract contemplates separate written agreements with subcontractors.
- Equitable estoppel does not permit a signatory to force arbitration on a nonsignatory who did not knowingly exploit the contract containing the arbitration clause and whose claims arise from statutory rights rather than contract-based rights.
- Third-party-beneficiary status requires contractual intent to confer enforceable rights on the third party; indirect benefit from a company–vendor contract, without such intent and without a separate agreement, does not bind the worker to arbitration.

## Conclusion

The First Circuit held that a delivery driver who neither signed nor knew of an arbitration clause in a logistics company’s contract with an affiliated vendor could not be compelled to arbitrate wage-and-hour and misclassification claims, and that agency, equitable estoppel, and third-party-beneficiary doctrines did not supply the missing assent.


Ouadani v. TF Final Mile, LLC, 876 F.3d 31 (1st Cir. 2017)