Jackson v. Applied Materials Corporation, 5:20-cv-06007

Kevin F. Jackson accepted a Product Line Management IV offer from Applied Materials on June 1, 2018 and signed an Employment Agreement that required binding arbitration administered by JAMS and waived court/Jury rights; the agreement expressly covered Title VII claims.
Jackson last worked for Applied Materials in December 2019 and filed a Title VII complaint (race discrimination and retaliation, including alleged constructive discharge) on August 24, 2020.
Applied Materials moved to compel arbitration under the Employment Agreement and to stay the action; Jackson opposed, arguing duress/unconscionability and that JAMS/arbitrators are biased (citing a racist email by a former JAMS arbitrator and alleged repeat-player conflicts).
The court took judicial notice of the JAMS Employment Arbitration Rules (but not JAMS’s website) and applied the FAA and California contract law to assess formation and unconscionability.
The court found the agreement was an adhesion contract with only minimal procedural unconscionability, rejected Jackson’s substantive-unconscionability showing (JAMS neutrality and repeat-player concerns insufficient), concluded the arbitration clause covers Jackson’s Title VII claim, granted the motion to compel arbitration, and stayed the case pending arbitration.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Existence/formation of arbitration agreement	Agreement signed under duress; lacked meaningful choice	Jackson signed offer and Employment Agreement; agreement is binding	Valid agreement exists; no genuine fact issue as to formation
Unconscionability (procedural & substantive)	Adhesive precondition to employment; JAMS bias and repeat-player conflicts make arbitration unfair	Agreement is standard, JAMS Rules require disclosures and party involvement in arbitrator selection; no particularized bias shown	Agreement is adhesive but only minimal procedural unconscionability; not substantively unconscionable; arbitration enforceable
Neutrality of JAMS/arbitrators	JAMS culture of bias (email from a former JAMS arbitrator) and potential conflicts make neutral adjudicator unlikely	Parties can obtain disclosures under JAMS Rules; parties can avoid particular arbitrators; no systemic bias shown	Isolated email does not show presumptive bias; parties can use JAMS disclosure/selection procedures to avoid biased arbitrators
Scope: Are Title VII claims arbitrable?	Title VII claims should not be removed from court	Agreement expressly reserves Title VII claims to arbitration	Clause unambiguously covers Title VII; claim must be arbitrated

Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (FAA governs certain employment arbitration agreements)
Moses H. Cone Mem’l Hosp. v. Mercury Constr. Co., 460 U.S. 1 (federal policy favoring arbitration)
AT&T Techs., Inc. v. Communications Workers of Am., 475 U.S. 643 (arbitration clauses construed broadly to determine coverage)
Geier v. M-Qube Inc., 824 F.3d 797 (Ninth Circuit two-step FAA test: valid agreement and scope)
Rent-A-Center, W., Inc. v. Jackson, 561 U.S. 63 (arbitration agreements subject to generally applicable contract defenses)
Poublon v. C.H. Robinson Co., 846 F.3d 1251 (California unconscionability: procedural/substantive sliding scale)
Armendariz v. Found. Health Psychcare Servs., Inc., 24 Cal.4th 83 (neutral arbitrator requirement and unconscionability framework in employment arbitration)
Nagrampa v. MailCoups, Inc., 469 F.3d 1257 (repeat-player status alone insufficient to show arbitrator bias)