For the compulsory arbitration topic, it is very
important to know the caselaw. With the
current split in the circuits, it is necessary to know how your circuit
rules on the issue, but there
are also many sub-issues within the compulsory arbitration issue, and
it is possible your circuit
may not have decided a particular question yet. Consequently
it may become important to know
how other circuits have ruled.
It is also a good idea to note whether the court
actually compels the arbitration agreement
in the case. Many of the courts hold that pre-dispute arbitration
agreements are enforceable in
theory, but go on to hold that the specific agreement they are examining
is NOT. This goes back
to the issue that the agreement must meet certain standards, and these
standards are to be found
in the caselaw. (However, the Bales article and/or book, listed
under Most Valuable Resources is
helpful in compiling the cases to draw out a standard.)
I will list below a few cases from each circuit,
including district court cases, regarding
compulsory arbitration, which I found with a Westlaw search in All
Federal Cases Organized by
Circuit of Origin. I included brief information about most of
them. I could have done the search
in Courts of Appeals Cases by Circuit and pulled no district court
cases, but I decided to put in
some on point district court cases. I used the search term “mandatory
or compulsory arbitration
agreements and statutory rights” and did a Natural Language search.
I restricted the date to after
1991, which was the year the Supreme Court decided Gilmer. The
same search can be done in
Lexis (slightly different name of database though). Cases can
also be found in the library in print,
of course, and the cites are listed here. Additionally, on the
Legal Resources page I included
information about Academic Universe, and on the Websites page I included
other places to find
cases as well.
A helpful tip in a Westlaw search is that after you
run the query and switch to the next
circuit, you can click on “query list” and it has the words from the
query you just ran so you do
not have to type it all over again for each circuit. However,
you may also want to experiment
with changing your search terms. For instance, with the search
term listed above, for some
reason I did not pull up the Hooters case listed below. I knew
about it from a Law Review
article, so I pulled it by its cite using the Find button in Westlaw
(the button is on top of screen
and says “FI”). Usually if you get a lot of good hits, as I did
with the search term above, that is
enough to get started with and you can get other cites from journal
articles or from Shepardizing
or Keyciting the main cases.
Obviously, any case included here should be Shepardized
or Keycited before relying on
it, to make sure it is still good law. In fact, a very useful
tool to learn about the mandatory
arbitration topic is to Shepardize or Keycite cases. This will
tell you whether other courts
approve or disapprove of the case you are looking at, as well as telling
you whether it has been
overruled, of course! For example, Gilmer, from 1991, has 1245
cites. Of these, 36 come up
under “negative.” Looking at these is very informative as to
the state of mandatory arbitration, as
I noted below in the Currency section. Further, if a researcher
did not have access to Westlaw or
Lexis, Shepardizing cases would be a good way to find out how other
circuits rule on the
arbitration topic (using Gilmer would be very helpful way to do this).
First Circuit
Rosenberg v. Merrill Lynch, et al., 170 F.3d 1 (1rst Cir. 1999). (See above, under Most Valuable Resources.)
LaChance v. Northeast Publishing, 965 F.Supp. 177 (D.Mass. 1997).
Former employee brought action against his former employer, claiming
age and handicap
discrimination in violation of state law and the Americans with Disabilities
Act (ADA). Former
employer moved for summary judgment. The District Court, Gertner,
J., held that arbitration
clause contained in parties' collective bargaining agreement did not
preclude former employee
from maintaining his lawsuit. Motion denied.
Second Circuit
Martens v. Smith Barney, Inc., 181 F.R.D. 243 (S.D.N.Y. 1998).
Female employees of investment company brought class action against
company, stock
exchange, and association of securities dealers, alleging gender-based
discrimination and
challenging defendants' practice of conditioning employment on compulsory
arbitration of all
employment-related claims. After reaching settlement, parties moved
for a final order certifying
the class, approving the settlement, and dismissing the claims. Held:
(1) district court had subject
matter jurisdiction necessary to make judicial evaluation of settlement,
despite employees'
agreement to arbitrate as condition of employment; certification of
class was proper; (2)
negotiating process for settlement was fair; (3) lack of guaranteed
damages and personnel
measures against alleged discriminators was not fatal to approval of
settlement; and (4) proposed
dispute resolution process for future claims by individuals survived
scrutiny; but (5) final
approval of settlement would be withheld because of amorphous nature
of diversity programs
that company was required to implement over four years and the unavailability
of judicial review
of disputes over company's compliance with that requirement.
Final approval of settlement
denied.
Desiderio v. National Ass'n of Securities Dealers, Inc., 2 F.Supp.2d 516 (S.D.N.Y. 1998).
Raiola v. Union Bank of Switzerland, LLC, 1999 WL 262284 (S.D.N.Y., Apr 30, 1999).
Plaintiff alleges discrimination on the basis of her sex under Title
VII. Defendant moves
to compel arbitration pursuant to Sections 2-4 of the Federal Arbitration
Act. Defendant's
motion to compel arbitration is granted and this action shall be dismissed
without prejudice to
reinstatement in the event further proceedings are required following
the arbitration.
Phillips v. CIGNA Investments, Inc., 27 F.Supp.2d 345 (D.Conn. 1998).
Employers moved to compel arbitration of employee's employment discrimination
claims. The District Court, Goettel, J., held that parties never entered
into a valid agreement to
arbitrate. Motion denied.
Third Circuit
Bender v. Smith Barney, Inc., 789 F.Supp. 155 (D.N.J. 1992).
Former employee of securities brokerage firm brought action in New Jersey
state court
alleging violation of Title VII. Following removal, the District
Court, Bassler, J., held that: (1)
action was not time barred; (2) claim was subject to compulsory
arbitration; and (3) compulsory
arbitration of Title VII claims was not contrary to public policy.
Ordered accordingly.
Randolph v. Cooper Industries, 879 F.Supp. 5182 (W.D.Pa. 1994).
Employee brought discrimination action pro se against employer and individuals,
alleging racial
harassment in violation of Title VII, Civil Rights Act of 1991, and
S 1981. On motion by
employer and employees for summary judgment, the District Court, Ambrose,
J., held that: (1)
fact that collective bargaining agreement (CBA) contained both antidiscrimination
provision and
mandatory grievance and arbitration procedure did not compel finding
that employee was
required to use those procedures prior to bringing claims in court,
and (2) individual supervisors
could not be held liable on Title VII claim.
Seus v. John Nuveen & Co., Inc., 146 F.3d 175 (3rd Cir. 1998).
Former employee brought suit against brokerage firm alleging claims
of discrimination
under Title VII and the Age Discrimination in Employment Act. District
Court granted
employer's motion to compel arbitration of claims pursuant to the FAA,
and plaintiff appealed.
Held: (1) arbitration agreement which employee signed as part of Uniform
Application for
Securities Industry Registration (Form U-4) was valid and enforceable
under the FAA, with
respect to claims under Title VII and the ADEA; (2) arbitration agreement
covered employment
dispute; and (3) district court did not abuse its discretion in denying
plaintiff's motion to depose
the NASD in connection with her claim that current NASD arbitration
procedures were
inadequate to protect her statutory and due process rights. Affirmed.
Fourth Circuit
Hooters of America, Inc. v. Phillips, --- F.3d ----, 1999 WL 194438 (4th Cir.1999).
Annette R. Phillips alleges that she was sexually harassed while working
at a Hooters
restaurant. After quitting her job, Phillips threatened to sue Hooters
in court. Alleging that
Phillips agreed to arbitrate employment-related disputes, Hooters preemptively
filed suit to
compel arbitration under the Federal Arbitration Act. Because Hooters
set up a dispute resolution
process utterly lacking in the rudiments of even-handedness, we hold
that Hooters breached its
agreement to arbitrate. Thus, we affirm the district court's refusal
to compel arbitration.
Austin v. Owens-Brockway Glass Container, Inc., 78 F.3d 875 (4th Cir. 1996).
Discharged employee brought action against her former employer for violating
Title VII
and Americans with Disabilities Act (ADA) by terminating her while
she was on medical leave
and receiving workers' compensation benefits and not reassigning her
to light-duty work when
she was able to return to work. District Court granted summary
judgment for employer, and
employee appealed. Held: (1) employee had standing under collective
bargaining agreement
(CBA) to arbitrate her dispute after being discharged; (2) arbitration
of employee's Title VII and
disability claims was mandatory under CBA; (3) agreement to arbitrate
ADA and Title VII
statutory claims was enforceable; and (4) employee could not sue employer
before pursuing
arbitration of her discrimination claims. Affirmed as modified
and remanded.
Rudolph v. Alamo Rent A Car, Inc., 952 F.Supp. 311 (E.D.Va. 1997).
Former employee sued former employer for sexual harassment under Title
VII. Former
employer filed motion to stay court proceedings and to compel arbitration.
District Court held
that employment contract's arbitration clause, which provided binding
arbitration only for alleged
violations of contract, did not mandate binding arbitration of former
employee's statutory rights
under Title VII and Civil Rights Act of 1991. Motion denied.
Fifth Circuit
Mouton v. Metropolitan Life Ins. Co., 147 F.3d 453 (5th Cir. 1998).
Securities broker filed Title VII retaliation action against employer.
Employer moved
for summary judgment. District Court denied motion, and employer
appealed. Court of
Appeals, Wisdom, Circuit Judge, held that: (1) broker was compelled
to arbitrate Title VII claim
under prior version of National Association of Securities Dealers (NASD)
Code, and (2) claim
did not fall within insurance business exception to Code's arbitration
provision. Reversed and
remanded.
Davis v. Houston Lighting & Power, 990 F.Supp. 515 (S.D.Tex. 1998).
Employee brought discrimination action pursuant to Title VII.
Employer moved to
dismiss claims on ground that claim was subject to arbitration clause
in collective bargaining
agreement. District Court held that collective bargaining agreement
did not serve as a valid
agreement to arbitrate employee's discrimination claims; such claims
were too important to be
waived by a collective bargaining agreement. Motion denied.
Rojas v. TK Communications, Inc., 87 F.3d 745 (5th Cir. 1996).
Female former employee brought action against former employer and successor
owner of
radio station alleging sexual harassment in violation of Title VII.
District Court granted former
employer's motion to dismiss and successor's motion for summary judgment.
Former employee
appealed. Held: (1) Federal Arbitration Act's (FAA) exclusionary
clause did not preclude
arbitration of Title VII claim; (2) arbitration clause in employment
contract was sufficiently
broad to encompass Title VII claim; and (3) policy underlying
successor doctrine was not served
by imposing liability on successor. Affirmed.
Sixth Circuit
Gray v. Toshiba America Consumer Products, Inc., 959 F.Supp. 805 (M.D.Tenn. 1997).
Employee sued her employer for discrimination in violation of Title
VII, S 1981, S 1983,
and Tennessee Human Rights Act. On employer's motion to dismiss,
treated as motion for
summary judgment, the District Court, Echols, J., held that:
(1) employee's failure to allege that
her employer acted in any respect other than as wholly private actor
was fatal to employee's S
1983 claim, and (2) employee's prior unsuccessful attempt to submit
employment discrimination
claim to arbitration did not preclude her from bringing Title VII,
S 1981, and Tennessee Human
Rights Act claims in federal court.
E.E.O.C. v. Frank's Nursery & Crafts, Inc., --- F.3d ----, 1999
WL 235476, 79 Fair
Empl.Prac.Cas. (BNA) 936 (6th Cir. 1999).
The Equal Employment Opportunity Commission ("EEOC") appeals the order
of the
district court both dismissing its claims brought on behalf of Carol
Adams ("Adams") and a class
of similarly situated employees under Title VII of the Civil Rights
Act of 1964 ("Title VII"), and
granting the motion of Defendant to compel Adams to enter binding arbitration
pursuant to the
Federal Arbitration Act ( "FAA"). For the reasons set forth below,
we REVERSE.
Seventh Circuit
Koveleskie v. SBC Capital Markets, Inc., 167 F.3d 361 (7th Cir. 1999).
Former securities industry employee sued former employer for sex discrimination.
District Court denied employer's motion to dismiss and to compel arbitration.
Employer
appealed. Held: (1) Congress did not intend Title VII to preclude
enforcement of pre-dispute
arbitration agreements; (2) employee failed to establish that securities
industry arbitration
procedures were biased and inadequate to protect statutory rights;
(3) mandatory arbitration
agreement did not create unconscionable contract of adhesion under
Illinois law; (4) employee
failed to establish any state action necessary to support her claim
that mandatory securities
industry arbitration violated her rights based on "unconstitutional
conditions" doctrine; and (5)
employee's Equal Pay Act and New York Human Rights Law claims were
arbitrable. Reversed
and remanded.
Cremin v. Merrill Lynch, Inc., 957 F.Supp. 1460 (N.D.Ill. 1997).
Michalski v. Circuit City Stores, Inc., --- F.3d ----, 1999 WL 274514 (7th Cir. 1999).
Circuit City appeals from the district court's denial of its motion
to dismiss and to compel
arbitration of Michalski's discrimination claim under Title VII of
the Civil Right Act of 1964.
We now reverse and remand, holding that the arbitration agreement entered
into by the parties
supersedes Michalski's right to pursue her discrimination claim in
federal court.
Eighth Circuit
Johnson v. Hubbard Broadcasting, Inc., 940 F.Supp. 1447 (D.Minn. 1996).
African-American former employee brought action against former employer
alleging race
discrimination in violation of Title VII and the Minnesota Human Rights
Act (MHRA). Former
employer moved for an order to compel arbitration and stay proceedings
pursuant to Federal
Arbitration Act (FAA) and Minnesota Uniform Arbitration Act (MUAA).
District Court held
that agreement to arbitrate was enforceable. Motion granted.
Battle v. Prudential Ins. Co., 973 F.Supp. 861 (D.Minn. 1997).
Securities broker sued former employer, alleging termination based on
racial and age
discrimination. Broker moved for default judgment and former
employer moved to compel
arbitration. District Court held: (1) default judgment would
not be granted, after employee failed
to file timely answer to complaint; (2) claims under Title VII may
be subjected to compulsory
arbitration; (3) broker was bound by arbitration provision contained
in Form U- 4, required by
NASD to be signed by employees of members, even though he claimed he
was not allowed time
to read it; (4) arbitration was required, even though regulation imposing
arbitration of
employment disputes was not added to NASD regulations until after broker
signed Form; (5)
exception to arbitration agreement, for cases involving insurance,
was unavailable; and (6) public
policy did not require that arbitration requirement be set aside.
Motions to dismiss granted in
part; denied in part.
Ninth Circuit
Duffield v. Robertson Stephens & Co., 144 F.3d 1182 (9th Cir.
1998), cert. denied, 119 S.Ct. 445
(1998). (See above under Most Valuable Resources.)
Nelson v. Cyprus Bagdad Copper Corp., 119 F.3d 756 (9th Cir.1997).
Employee sued his former employer, on grounds that employer's insistence
that he work
rotating twelve-hour shifts violated the Americans With Disabilities
Act (ADA). District Court
granted summary judgment against employee on grounds that employee
waived right to judicial
forum for his claims. Employee appealed. Held: (1) employee
did not knowingly agree to
arbitrate claims by signing form acknowledging receipt of revised employee
handbook; (2)
employee's continued employment after receiving and reading handbook
was not knowing
agreement to mandatory arbitrary provision therein; and (3) employee's
initiation of complaint
pursuant to problem solving process promulgated under handbook was
not valid waiver.
Reversed in part, vacated in part, and remanded. Rymer, Circuit
Judge, filed dissenting opinion.
Prudential Ins. Co. of America v. Lai, 42 F.3d (9th Cir. 1994).
Nghiem v. NEC Electronic, Inc., 25 F.3d 1437 (9th Cir. 1994).
Tenth Circuit
Metz v. Merrill Lynch Inc., 39 F.3d 1482 (10th Cir. 1994).
Former employee brought Title VII action against former employer for
pregnancy
discrimination. District Court entered judgment for employee.
Employer appealed. Court of
Appeals held: (1) Title VII claims are subject to mandatory arbitration;
(2) action was not
precluded from arbitration by section of Federal Arbitration Act (FAA)
stating that FAA did not
apply to certain employment contracts; (3) employer waived its
right to compel arbitration of
action; and (4) evidence was sufficient to support finding that
broker's termination was result of
pregnancy discrimination. Affirmed in part, reversed in part,
and remanded.
Shankle v. B-G Maintenance Management of Colorado, Inc., 163 F.3d 1230 (10th Cir. 1999).
Former employee brought action against former employer under Title VII,
Americans
with Disabilities Act (ADA), and Age Discrimination in Employment Act
(ADEA), and former
employer moved to compel arbitration. District Court denied motion.
Former employer
appealed. Court of Appeals held: (1) employee's positions as janitor
and shift manager did not
directly affect interstate commerce so as to insulate him from coverage
of Federal Arbitration
Act (FAA), and (2) arbitration agreement which employee entered into
as condition of continued
employment, and which required him to pay portion of arbitrator's fees,
was unenforceable under
FAA. Affirmed.
Eleventh Circuit
Brisentine v. Stone & Webster Engineering Corp., 117 F.3d 519 (11th Cir. 1997).
Employee sued employer for violating Americans with Disabilities Act
(ADA). District
Court granted summary judgment in favor of employer on grounds that
claims were subject to
compulsory arbitration. Employee appealed. Court of Appeals held:
claim was not subject to
compulsory arbitration pursuant to arbitration clause in collective
bargaining agreement.
Reversed and remanded.
Paladino v. Avnet Computer Technologies, Inc., 134 F.3d 1054 (11th Cir. 1998).
Former employee brought Title VII action against former employer.
District Court
denied former employer's motion to compel arbitration. Former
employer appealed. Court of
Appeals held that District Court correctly refused to compel arbitration
of Title VII claim
pursuant to agreement providing for arbitration of any claim arising
from employment but further
providing that damages could be awarded for breach of contract only.
D.C. Circuit
Cole v. Burns Intern. Sec. Services, 105 F.3d 1465 (D.C.Cir. 1997).
(See above under Most
Valuable Resources.)
Gary v. Washington Metropolitan Area Transit Authority, 886 F.Supp. 78 (D.D.C. 1995).
Employee of Washington Metropolitan Area Transit Authority (WMATA) brought
Title
VII action against WMATA, alleging that it retaliated against her and
constructively discharged
her because of her complaints of sexual harassment and discrimination.
On WMATA's motion
for summary judgment, the District Court held: (1) Title VII
claims can be subject to
compulsory arbitration; (2) employee's claims were not subject
to compulsory arbitration under
WMATA compact; (3) WMATA was strictly liable under Title VII
for alleged conduct of its
supervisors in retaliating against employee; (4) no adverse employment
actions occurred during
180-day period for filing claims with Equal Employment Opportunity
Commission (EEOC), and
continuing violation theory did not save employee's untimely retaliation
claims; and (5)
limitations period for filing constructive discharge claim with EEOC
began to run, at latest, when
employee's attorney advised court of his intention to amend complaint
to add constructive
discharge claim. Motion granted in part and denied in part.