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Hartwell Harris v. Bingham Mccutchen et al

March 29, 2013

HARTWELL HARRIS, PLAINTIFF AND RESPONDENT,
v.
BINGHAM MCCUTCHEN ET AL., DEFENDANTS AND APPELLANTS.



APPEAL from a judgment of the Superior Court of Los Angeles County, Mel Red Recana, Judge. (Los Angeles County Super. Ct. No. BC474009)

The opinion of the court was delivered by: O'neill, J.*fn2

CERTIFIED FOR PUBLICATION

Affirmed.

I. INTRODUCTION

Defendants, Bingham McCutchen LLP, Seth Gerber and Jonathan Loeb, appeal from an order denying their petition to compel plaintiff, Hartwell Harris, to arbitrate her California employment discrimination and wrongful termination claims. We affirm because the trial court did not err in concluding the arbitration provision was unenforceable under Massachusetts law, which the parties agreed applied to the employment relationship.

II. BACKGROUND

On November 21, 2011, plaintiff filed the complaint against Bingham and two individuals. She alleged defendants wrongfully terminated her in February 2011, after she requested reasonable accommodations for a disabling sleep disorder. The complaint alleged nine causes of action: six for violations of the California Fair Employment and Housing Act (Gov. Code, § 12940); and additional claims for a termination in violation of public policy, Business and Professions Code Section 17200 et seq. and defamation.

Defendants petitioned to compel arbitration of the claims based on a letter agreement between plaintiff and Bingham dated April 25, 2007. Paragraph 8 of the letter agreement contains the following arbitration provision: "You and the Firm agree that 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, and which disputes cannot be resolved informally, shall be resolved exclusively through final and binding private arbitration before an arbitrator mutually selected by you and the Firm. If you and the Firm are unable to agree upon an arbitrator within twenty-one (21) days after either you or the Firm has made a demand for arbitration, the matter will be submitted for arbitration to the Santa Monica office of the Judicial Arbitration & Mediation Services ('JAMS'), and shall be administered by [Judicial Arbitration & Mediation Services] pursuant to its rules governing employment arbitration in effect as of the date of this letter agreement. Judgment upon the award of the arbitrator may be enforced in any court having jurisdiction thereof."

Plaintiff opposed the arbitration petition on the ground the provision was unenforceable under the letter agreement's choice-of-law provision applying Massachusetts law to the employment relationship. The choice-of-law provision provides in part: "This letter agreement . . . shall be construed in accordance with the internal substantive laws of The Commonwealth of Massachusetts." Plaintiff asserted that Massachusetts substantive law as stated in Warfield v. Beth Israel Deaconess Medical Center, Inc. (Mass. 2009) 454 Mass. 390, 398 (Warfield), precluded arbitration of her statutory discrimination claims. This was because Warfield required agreements to arbitrate statutory discrimination be in clear and unmistakable terms. As an alternative argument, plaintiff asserted the arbitration clause was not enforceable because it was substantively and procedurally unconscionable.

Defendant replied Warfield was inapplicable because plaintiff's claims were brought for violations of California's statutes. And, Warfield was preempted by the Federal Arbitration Act (9 U.S.C. §1 et seq.) as articulated in the United States Supreme Court's decision in AT&T Mobility v. Concepcion (2011) 131 S. Ct. 1740, 1743 (Concepcion).

The trial court denied the arbitration petition on the grounds: the provision was not enforceable under Massachusetts law; Warfield does not interfere with fundamental attributes of arbitration as articulated in Concepcion and, the arbitration agreement was unconscionable. Defendants filed a timely notice of appeal from the order denying the petition.

III. DISCUSSION

Defendants contend that plaintiff Harris's California statutory claims are governed by California rather than Massachusetts law. That may or may not be true as Harris's lawsuit progresses in the superior court. The issue at hand is whether Harris has properly resorted to the superior court in the first place. To make that determination, defendants would have us conclude that the employment agreement's choice-of-law provision does not govern questions of arbitrability.

Neither party challenges the validity of the choice-of law-provision, which, as noted above, applies "the internal substantive laws of the Commonwealth of Massachusetts" to any disputes arising out of the employment relationship. Defendants cite Samaniego v. Empire Today, LLC (2012) 205 Cal.App.4th 1138 (Samaniego), in support of their contention that California statutory claims, if they survive the choice-of-law provision, are "necessarily" governed by California law. Samaniego is distinguishable. It held that California law governed the enforceability of an arbitration clause in an otherwise unconscionable employment agreement which contained an Illinois choice-of-law provision. (Id. at p. 1148.) In rejecting the employer's attempt to enforce the choice-of-law provision, the court noted, "the same factors that render the arbitration provision unconscionable warrant the application of California law . . . [E]nforcing [defendant's] choice-of-law provision would result in substantial injustice." (Id. at p. 1149.) As noted in Samaniego, in California the weaker party to an adhesion contract may avoid ...


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