Tiffany Hill v. Xerox Business Services, LLC
59 F.4th 457
| 9th Cir. | 2023Background
- Tiffany Hill sued Xerox Business Services, LLC (XBS) on behalf of a putative class of Washington call‑center agents alleging wage-and-hour violations under state law; Hill never signed any arbitration agreement.
- Starting in 2002 some XBS agents had signed a 2002 Dispute Resolution Plan (2002 DRP) requiring arbitration but silent about class arbitration; XBS adopted a 2012 DRP that expressly required individual arbitration and barred class claims for later hires.
- XBS litigated aggressively in federal court, including moving for partial summary judgment on the merits and pursuing an interlocutory appeal that produced a six-year delay before the stay lifted; during precertification XBS produced the 2002 DRP in discovery and repeatedly invoked the 2012 DRP.
- The district court provisionally certified an ABC class in 2014 (excluding 2012 DRP signatories) and later finalized notice; the class ultimately included 5,771 members, 2,927 of whom had signed the 2002 DRP.
- XBS moved to compel individual arbitration for the 2,927 2002‑DRP signatories only after class notice/finality (March 5, 2020); the district court denied the motion, finding XBS waived the right to compel arbitration as to those absent class members.
- The Ninth Circuit affirmed, applying a two‑element waiver test (post‑Morgan): (1) knowledge of the arbitration right, and (2) acts inconsistent with that right; the court rejected XBS’s futility defenses (including reliance on Lamps Plus), while Judge VanDyke dissented.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper test for arbitration‑waiver after Morgan | Morgan removes prejudice; Ninth Circuit waiver = knowledge + acts inconsistent with the right | N/A (dispute is over application) | Court restated waiver as two elements: knowledge and acts inconsistent with the right (prejudice not required) |
| Knowledge prong — did XBS know of a right to compel under the 2002 DRP? | Hill: XBS knew of 2002 DRP (produced it; asserted arbitration rights under 2012 DRP) and knew how to assert arbitration rights | XBS: no existing right to compel until class certified and members identified, so no waiver possible earlier | Court: knowledge exists even if the right was inchoate; XBS had knowledge and knew how to assert it, so prong satisfied |
| Acts‑inconsistent prong — did XBS act inconsistently with the 2002 DRP? | Hill: XBS litigated merits for years, sought extensive class discovery, repeatedly pressed the 2012 DRP but not the 2002 DRP, and pursued judicial resolution instead of arbitration | XBS: its precertification litigation targeted Hill (non‑signatory) and routine class discovery/merits motions are not inconsistent acts; moved to compel the first day it could | Court: considering the totality, XBS’s prolonged merits strategy, discovery directed at putative members, and disparate treatment of 2012 vs 2002 DRPs warranted finding acts inconsistent with arbitration rights under the 2002 DRP |
| Futility defense (could earlier motions to compel have been futile?) | Hill: XBS’s conduct is not excused by futility; Stolt‑Nielsen already protected parties from forced class arbitration and Lamps Plus did not change that core issue | XBS: it would have been futile to move earlier because absent members were not yet parties and law before Lamps Plus made class/individual arbitration uncertain for 2002 DRP signatories | Court: futility not established — waiver not excused; right existed, Stolt‑Nielsen already governed silence on class arbitration, Lamps Plus did not create a new obstacle to asserting the 2002 DRP |
Key Cases Cited
- Morgan v. Sundance, 142 S. Ct. 1708 (2022) (prejudice is not required to show waiver of arbitration)
- Stolt‑Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662 (2010) (silent arbitration agreements do not authorize class arbitration)
- Lamps Plus, Inc. v. Varela, 139 S. Ct. 1407 (2019) (addressed ambiguities about class arbitration; did not overrule Stolt‑Nielsen’s rule on silent contracts)
- Newirth v. Aegis Senior Communities, LLC, 931 F.3d 935 (9th Cir. 2019) (Ninth Circuit waiver framework and totality‑of‑circumstances approach)
- Fisher v. A.G. Becker Paribas Inc., 791 F.2d 691 (9th Cir. 1986) (historical Ninth Circuit formulation of waiver including prejudice prong)
- Van Ness Townhouses v. Mar Indus. Corp., 862 F.2d 754 (9th Cir. 1988) (defendant’s prolonged litigation and silence can demonstrate waiver)
- Martin v. Yasuda, 829 F.3d 1118 (9th Cir. 2016) (acts inconsistent with arbitration include extensive litigation to obtain judicial merits rulings)
- In re Mirant Corp. v. Castex Energy, Inc., 613 F.3d 584 (5th Cir. 2010) (refusing to allow delay to compel arbitration until after assessing federal forum advantages)
- Gutierrez v. Wells Fargo Bank, N.A., 704 F.3d 712 (9th Cir. 2012) (discussion of futility arguments and case‑by‑case assessment)