Monday, April 1, 2013
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C.A. Allows Fired Attorney to Sue Law Firm Over Disability Claim
Panel Says Choice of Massachusetts Law Renders Arbitration Clause Unenforceable
By KENNETH OFGANG, Staff Writer
The Court of Appeal for this district Friday said a former associate at the national law firm of Bingham McCutchen can sue the firm for employment discrimination and wrongful termination.
Hartwell Harris, a former Bingham associate in Santa Monica, sued the firm in 2011, claiming she was terminated because she suffers from a sleep disorder that was diagnosed in 2010 and for which Bingham failed to offer a reasonable accommodation. She said the firm allowed her a short-term leave, but refused to allow her to telecommute or to work different hours, and ultimately fired her.
Records show that Harris—a graduate of Princeton University and UC Berkeley School of Law—was admitted to practice in California in 2006 and in Mississippi last year and practices in Winona, Miss.
The law firm, which argues that it reasonably accommodated Harris, petitioned to compel arbitration, but the trial and appellate courts held the agreement could not be applied to a statutory discrimination claim.
The ruling was based on a choice-of-law clause in Harris’ employment agreement, which she signed in 2007.
Choice-of-Law Clause
The choice-of-law clause said that the agreement would be “construed in accordance with the internal substantive laws of The Commonwealth of Massachusetts.” The arbitration clause provided that an arbitrator chosen by the parties, or assigned by JAMS if the parties could not agree, would decide “any legal disputes which may occur between you and the Firm and which arise out of, or are related in any way to your employment with the Firm or its termination.”
Bingham, which boasts over 1,000 lawyers in nine U.S. cities—including Los Angeles and Santa Monica—and five international locations, is connected to Massachusetts as the descendant of Bingham, Dana & Gould, an old-line Boston firm. Bingham Dana merged with San Francisco’s McCutchen, Doyle, Brown & Enersen in 2002, later acquiring its local presence through mergers with Riordan & McKinzie and Alschuler Grossman.
Los Angeles Superior Court Judge Mel Red Recana denied the firm’s motion to compel arbitration, relying on the choice-of-law clause and Warfield v. Beth Israel Deaconess Medical Center, Inc. (Mass. 2009) 454 Mass. 390. The Supreme Judicial Court said that “an employment contract containing an agreement by the employee to limit or waive any of the rights or remedies conferred by [the Commonwealth’s antidiscrimination law] is enforceable only if such an agreement is stated in clear and unmistakable terms.”
Preemption Argument
Bingham McCutchen argued on appeal that Warfield was not controlling because Harris brought her claim under California’s anti-bias law, not Massachusetts’, and that the arbitration clause was enforceable in any event under federal law, based on AT&T Mobility v. Concepcion (2011) 131 S. Ct. 1740, holding that the Federal Arbitration Act preempted California from overriding the parties’ agreed-upon waiver of classwide arbitration.
But Ventura Superior Court Judge Vincent O’Neill, writing for the Court of Appeal’s Div. Five, said the issue was not which jurisdiction’s substantive law would apply, but “whether Harris has properly resorted to the superior court in the first place.” Bingham, the jurist said, is in no position to argue otherwise, especially since it drafted the contract.
“In the present case, the stronger party attacks its own choice-of-law provision, and makes no claim that plaintiff used improper means or that the contract is unconscionable,” O’Neill noted. “Indeed, defendants make no argument against the choice-of-law provision, except as to the arbitrability issue. They also contend that the employment agreement is not unconscionable.”
Jurist’s Reasoning
When an action is filed in California, and the parties have by contract chosen to be governed by another state’s laws, the court will apply those laws to determine the enforceability of the contract, including any arbitration clause, O’Neill explained. And under Massachusetts law, it is “the general nature of [the] claim, without regard to its statutory basis,” that determines whether it is encompassed within the arbitration clause, he reasoned.
The jurist wrote:
“The arbitration clause in this case is strikingly similar to the one in Warfield....Like the hospital’s contract in Warfield, the present agreement does not state in clear and unmistakable terms that plaintiff was waiving or limiting any statutory antidiscrimination rights. Accordingly, pursuant to Warfield, it is not enforceable under Massachusetts law. “
To apply Warfield only to violations of the Massachusetts statute, and not to violations of other anti-discrimination laws, would be contrary to Massachusetts public policy, and thus inconsistent with the choice-of-law clause, he said.
He went on to reject the preemption argument, citing a footnote in Justice Antonin Scalia’s majority opinion in Concepcion:
“Of course states remain free to take steps addressing the concerns that attend contracts of adhesion – for example, requiring class-action-waiver provisions in adhesive arbitration agreements to be highlighted.”
Based on that reasoning, O’Neill said, “the Supreme Court would approve of the requirement at issue here, that contractual waivers of statutory antidiscrimination litigation rights must be expressly stated to be enforceable.”
Attorneys on appeal were Debra L. Fischer, Robert A. Brundage and Jessica S. Boar of Bingham McCutchen for Bingham McCutchen, and Tamara S. Freeze, Robert Odell and Allison Lin of the Law Offices of Tamara S. Freeze for Harris.
The case is Harris v. Bingham McCutchen, 13 S.O.S. 1613.
Copyright 2013, Metropolitan News Company