MEMORANDUM OPINION AND ORDER
Plaintiff Marybeth Cremin sues her employer, Merrill Lynch, and supervisor, Joseph Gannotti, alleging that they subjected her to gender and pregnancy discrimination in violation of Title VII. She anticipates, however, that both defendants will move to send these claims to arbitration based on securities exchange arbitration rules. Heading them off at the pass, Count III of Cremin’s complaint adds the New York Stock Exchange and the National Association of Securities Dealers as defendants, and seeks a declaratory judgment that the exchange-mandated arbitration of discrimination claims deprives Cremin of her constitutional due process and statutory rights. All four defendants contest this allegation, and have accordingly moved to dismiss Count III.
RELEVANT FACTS
A. The Arbitration Agreement
In 1982, Marybeth Cremin was hired by Merrill Lynch as a licensed Financial Consultant. Compl. ¶2. To work in this area, Cremin had to register with the NASD and the NYSE 1 so that she could trade on the exchanges. Id. ¶7. She registered by completing the Uniform Application for Securities Industry Registration (Form U-4), *1463 which contained a clause requiring applicants to submit disputes to arbitration as specified in the NASD and NYSE rules:
I agree to arbitrate any dispute, claim or controversy that may arise between me and my firm or a customer or any other person, that is required to be arbitrated under the rules, constitutions, or by-laws of the organizations with which I register as indicated in Question 8.
Mot. Defs. Merrill.Lynch and Ganotti to Dismiss, Ex. 1 (Form U-4) at 4. 2 The U-4 incorporates not only the rules of the exchanges with which the applicant registers, but also their prospective amendments:
“I hereby apply for registration with the organizations indicated in Question 8 and ... I submit myself to the jurisdiction of such ... organizations and hereby certify that I have read, understand and agree to abide by, comply with, and adhere to all the provisions, conditions, and covenants of the., constitutions, by-laws and rules and regulations of the ... organizations as they are and may be adopted, changed or amended from time to time....”
Id. These provisions are on the same page and preceded at the top by directions, in capital letters, that “THE FOLLOWING SHOULD BE READ VERY CAREFULLY BY THE APPLICANT”; a signature line appears at the bottom. Id. Using this form, Cremin registered with the NASD on October 20, 1982 and with the NYSE on September 11, 1983. Id. Ex. 2 (“Registrations & Exams: Cremin, Marybeth N.”).
Both the NYSE and NASD have promulgated sets of arbitration rules that apply to registrants and member 3 firms. The NYSE has two provisions relevant here:
• Article XI, section 1 of the NYSE Constitution states that any controversy between a member and any other person arising out of the business of the member shall be arbitrated according to the NYSE Constitution and any rules the Board may adopt.
• NYSE Rule of Board 347 provides that any controversy between a registered representative and any member arising out of the representative’s employment with the member shall be settled by arbitration under the procedure prescribed in the rules.
Id. Ex. 3 (N.Y.SE, Constitution and NYSE Operation of Member Organizations). At the time Cremin signed the U-4, the NASD Code of Arbitration did not explicitly address employment disputes. In 1993, however, Part I, section 1 of the Code was amended to cover:
any dispute, claim or controversy arising out of or in connection with the business of any member of the Association, or arising out of the employment or termination of *1464 employment of associated person(s) 4 with any members....
Id. Ex. 3 (NASD Code of Arbitration Procedure). The Code further provides that disputes eligible for submission under Part I “shall be arbitrated.” Id.
B. The Discrimination Claims
While working in the securities industry for Merrill Lynch, Cremin claims she was the victim of discrimination on numerous occasions. Compl. ¶ 8. First, her supervisor, Joseph Gannotti, allegedly made disparaging remarks about her status as a working mother. Id. Among other things, Gannotti allegedly criticized the number of children Cremin had, stated he did not think women could combine family and career, hinted that Cre-min would do “better” at Merrill Lynch if she divorced her husband, and told Cremin he thought she was too busy having children to develop her customer accounts. Id.
Second, Cremin claims that Merrill Lynch took adverse action against her because she was a woman and had children. Id. She was allegedly denied the same career opportunities that were offered her male colleagues, and worked under less favorable conditions. Id. The company allegedly pressured her to transfer clients to other brokers when she became pregnant and, later, denied her proper maternity leave benefits. Id. ¶¶8-16. When Cremin returned to work after the birth of her child in May 1995, Gannotti allegedly induced her to surrender all her accounts to predominantly male brokers, then fired her immediately afterward. Id. ¶¶ 17-23. Cremin’s complaint does not reveal when the discrimination began, but the allegations are clear that it lasted through her child’s birth in May 1995 and her subsequent termination that same year.
Cremin filed suit in this Court on June 21, 1996, claiming both employer and securities industry-wide discrimination against women in violation of Title VII. Count III, the subject of the defendants’ motions to dismiss,
5
deals only with industry discrimination in the form of mandatory arbitration. Distilled, Count III alleges that the exchange-mandated arbitration of Title VII claims robs females employed in the securities industry of due process and perpetuates sex discrimination. The injury is twofold — plaintiffs are allegedly deprived of both constitutional protections and statutory rights under the 1991 Civil Rights Act. The defendants have two responses: (1) Cremin’s constitutional claims fail because they are not the product of state action, and (2) Cremin cannot claim the arbitration rules deny her statutory rights because the United States Supreme Court upheld mandatory arbitration of discrimination claims in
Gilmer v. Interstate/Johnson Lane Corp.,
*1465 LEGAL STANDARDS
A motion to dismiss tests the sufficiency of the complaint, not the merits of the suit.
Triad
Assocs.,
Inc. v. Chicago Housing
Auth.,
ANALYSIS
With Count III as her springboard, Cre-min mounts the following attacks on the securities industry’s mandatory arbitration scheme: First, compulsory arbitration deprives her the right to a jury trial under the Seventh Amendment and the 1991 Civil Rights Act. Second, arbitration forces Cre-min to forgo her right, granted by the Constitution and the 1991 Civil Rights Act, to have an Article III court adjudicate her discrimination claims. Third, the arbitration process is unaccompanied by the procedural protections that the Fifth Amendment guarantees litigants. Fourth, arbitration operates to forfeit the statutorily mandated benefits that Title VII confers, compounding the due process violation. Finally, Cremin argues that requiring her to waive each of these rights is both an unconstitutional condition of employment and a violation of the 1991 Civil Rights Act. Because the majority of Cremin’s contentions center on Fifth Amendment due process rights, we address them first.
A. State Action
Since 1883, the Supreme Court has hewed to the principle that only govemmen-tal actors can violate constitutional due process rights.
See The Civil Rights Cases,
First, ... [t]he mere fact that a business is subject to state regulation does not by itself convert its action into that of the State for purposes of the Fourteenth Amendment. The complaining party must also show that “there is a sufficiently close nexus between the State and the challenged action of the regulated entity so that the action of the latter may fairly be treated as that of the State itself.”
Second, ... a State normally can be held responsible for a private decision only when it has exercised coercive power or has provided such significant encouragement, either overt or covert, that the choice must in law be deemed to be that of the State. Mere approval of or acquiescence in the initiative is not sufficient to justify holding the State responsible for those initiatives under the terms of the Fourteenth Amendment.
Third, the required nexus may be present if the private entity has exercised powers that are “traditionally the exclusive prerogative of the State.”
*1466
1. The Registration and Arbitration Requirements
Cremin first argues that state action is present in the NASD and NYSE’s registration and arbitration requirements. She points to the SEC’s relationship with the exchanges for support. In 1982, when Cre-min signed the U-4, the Securities and Exchange Act of 1934 required broker-dealer firms and persons not associated with a firm to register with the SEC, as well as with the exchanges on which they traded. 15 U.S.C. §§ 78o(a)(1), (b)(1), (b)(8) (1981). The SEC in 1982 also allowed each exchange to promulgate registration rules. Id. § 78o-3(g)(3)(B). Moreover, at that time, the SEC had the power to review and approve proposed NASD and NYSE registration and arbitration requirements, and compelled the exchanges to comply with their own rules. Id. §§ 78f (a)—(b), 78o-3 (a)—(b), 78s(b)—(c), 78s(g)(1). Finally, in 1993, the SEC codified its own regulations prohibiting brokers from trading unless they registered with an exchange. 17 C.F.R. § 240.15b7-1 (May 1, 1993). All this, according to Cremin, warrants a finding that the NASD and NYSE registration and. arbitration requirements can be “fairly attributed” to the SEC.
We find that none of these provisions, alone or combined, adds up to state action. The plain fact is that when Cremin registered, no federal statute or SEC regulation required her to do so, to sign a U-4, or to arbitrate. 15 U.S.C. § 78o-3(g)(3)(B) (1981);
see Association of Investment Brokers v. SEC,
In short, a governmental actor’s “[m]ere approval of or acquiescence in the initiative” of a private actor does not amount to state action.
Blum,
Cremin cites the Seventh Circuit’s decision in
R.J. O’Brien & Assocs. v. Pipkin,
This analogy fails. The Commodities Exchange Act has always required registration. 7 U.S.C. §§ 6f(a), 6k(l). But no federal law mandated registration in the securities industry until 1993, well after Cremin signed the U-4. Instead, the SEC left up to each individual exchange the decision whether to promulgate registration rules. In the NFA’s case, registration was a function imposed by congressional legislation and delegated by a government agency. In contrast, the NASD and NYSE have been, up through 1993, the sole impetus for registration requirements in the securities industry. Consequently, we find the O’Brien analysis inapplicable to the NASD and NYSE, as have other district courts.
See Illyes v. John Nuveen Co.,
2. The SEC’s Plenary Control
Cremin’s next argument for finding state action centers on the SEC’s alleged “plenary control” over the NASD and NYSE’s rulemaking process. She maintains that the SEC “has provided such significant encouragement” to the exchanges in this process that their mandatory arbitration rules must deemed to come from the SEC itself. Pl. Resp. at 9 (citing Blum,
This line of argument was rejected long ago in
Jackson v. Metropolitan Edison Co.,
The nature of governmental regulation of private utilities is such that a utility may frequently be required by the state regulatory scheme to obtain approval for practices a business regulated in less detail would be free to institute without any approval from a regulatory body. Approval by a state utility commission of such a request from a regulated utility, where the commission has not put its own weight on the side of the proposed practice by ordering it, does not transmute a practice initiated by the utility and approved by the commission into “state action.”
Id.
at 357,
Under
Jackson,
it is clear that the SEC’s role in reviewing exchange rules, and arbitration rules in particular, does not make them the product of state action. First, the SEC has never ordered the NYSE or NASD to devise arbitration rules. In fact, when the exchanges first began using mandatory arbitration, the SEC did not even have the power to review exchange rules.
Investment Brokers,
State action exists “only when it can be said that the State is responsible for the specific conduct of which the plaintiff complains.”
Blum,
3. The Public Function Doctrine
Cremin’s third theory of state action is that, by administering systems of mandatory arbitration, the NASD and NYSE are assuming a traditionally governmental function — adjudicating discrimination claims. Cremin ties Merrill Lynch in by arguing that its “attempted use of judicial power” to enforce the “government-mandated arbitration clause” transforms the firm into a state actor. Neither argument persuades the Court.
First, courts.have consistently held that private arbitration lacks any element of state action.
Davis v. Prudential Sec., Inc.,
Second, Merrill Lynch is not using the government to deprive Cremin of her constitutional rights, but rather is simply asking this Court to enforce an agreement to determine these rights in a different forum. “By agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute; it only submits to their resolution in an arbitral, rather than a judicial, forum.”
Mitsubishi v. Soler Chrysler-Plymouth, Inc.
Against the weight of authority holding that administering an arbitration system and compelling arbitration are not state actions, Cremin pits the factually dissimilar
Lugar v. Edmondson Oil Co.,
Cremin contends that Merrill Lynch is also using a government official, i.e., this Court, to enforce the arbitration rules that will inevitably deprive her of due process. There is, however, no comparison with
Lugar.
First, Edmonson Oil used a state-constructed procedural scheme to attach Lugar’s property, whereas Merrill Lynch is simply following privately created arbitration rules and attempting to vindicate its contractual rights. Second, the only government official involved here is this Court — and we refuse to hold that every time a Court enforces a private arrangement it potentially violates one party’s constitutional rights. Most important, though, is the fact that the Lugar Court, wary of converting every use of legal procedure into state action, limited its holding to “the particular context of prejudgment attachment.”
Id.
at 939 n. 21,
4. State Action Under Cohen v. Cowles Media Co.
Finally, Cremin claims that state action exists in this case under the rationale set forth in
Cohen v. Cowles Media Co.,
The
Cohen
plaintiff provided a newspaper with political information, on the condition that he remain anonymous. Although the paper had agreed to keep the plaintiffs identity in confidence, it nevertheless ended up publishing his identity along with the information. The plaintiff sued for breach of contract. His claim reached the Minnesota Supreme Court, which held that the plaintiff could only recover, if at all, on a promissory estoppel theory.
Id.
at 668,
The Court ultimately reached the narrow conclusion that when a state court applies state law doctrine in a way that restricts
*1470
First Amendment freedoms, it engages in “state action” under the Fourteenth Amendment.
Id.
at 668,
What Cremin does not acknowledge is the fact that every court faced with the allegation that the U-4 is a contract of adhesion has rejected it.
Nieminski v. John Nuveen & Co.,
The upshot of holding that the U-4 is not an adhesion contract is that Cremin is the source of her own constitutional burdens. Her signature on the form, not the Court’s hypothetical ruling, creates the obligation to arbitrate according to exchange rules. The only issue, which we address later, is whether Cremin’s waiver of the right to a judicial forum was knowing. If her waiver is valid, we will enforce the contract because Cremin will have agreed to arbitrate. If the waiver is flawed, we will find that she did not consent to arbitration. But in no case would we restrict Cremin’s constitutional rights by dredging up a state law doctrine to manufacture a compact that never existed.
Since all four of Cremin’s state action theories uniformly fail, she cannot use the Fifth Amendment’s due process clause to reach the defendants’ actions. We therefore grant the defendants’ motions to dismiss Cremin’s Fifth Amendment claims.
B. Article III and Jury Trial Rights
Two constitutional claims remain: Cremin’s alleged right, under Article III, to have a court host her discrimination case and, under the Seventh Amendment, to have a jury evaluate it. We hold that neither right risks violation in this case.
Cremin contends that Article III guarantees her the right to an in-court adjudication of her Title VII claims. By enforcing the U-4’s arbitration clause, she claims, we would abrogate that right. However, rights to an Article III tribunal are waivable.
GFTC v. Schor,
*1471
A similar analysis applies to Cre-min’s jury trial claim. The Seventh Amendment does not confer the right to a trial, but only the right to have a jury hear the case once it is determined that the litigation should proceed before a court. If the claims are properly before an arbitral forum pursuant to an arbitration agreement, the jury trial right vanishes: “In a non-Article III forum the Seventh Amendment simply does not apply.”
Geldermann, Inc. v. CFTC,
To summarize, Cremin faces no threat that she will be deprived of either the right to an Article III court or to a jury trial. Rather, we will simply ask whether she agreed to arbitrate by knowingly forgoing a judicial forum. If the answer is yes, Cremin can hardly argue that her own valid waiver violates the Constitution. Having now examined all of Cremin’s constitutional claims, laid out in Count III, we find them to be without merit. The defendants’ motion to dismiss them is granted.
C. Claims Under the 1991 Civil Rights Act
We next turn to the statutory claims in Count III. Cremin alleges that the U-4’s mandatory arbitration clause violates her rights under the 1991 Civil Rights Act, depriving her of such statutorily mandated benefits as the right to a jury trial, to an Article III court, and to have the civil rights laws enforced as written.
1. The Gilmer Decision — Discrimination Claims Are Arbitrable
The Supreme Court addressed mandatory arbitration of discrimination claims under the securities industry’s Form U-4 in
Gilmer v. Interstate/Johnson Lane Corp.,
Our inquiry under
Gilmer
is therefore whether Congress intended to preclude arbitration of claims brought under Title VII, as amended by the 1991 Civil Rights Act. Unfortunately for Cremin, every decision since
Gilmer
has held that Congress erected no statutory barrier to compulsory arbitration of Title VII claims.
See, e.g., Alford v. Dean Witter Reynolds, Inc.,
The last of these, the D.C. Circuit’s just-issued opinion in
Cole v. Burns Int’l Security Services,
deserves special note because it furnishes the latest word on Gilmer’s application to Title VII claims. Plaintiff Cole signed, as a condition of his employment as a security guard with defendant Burns, a pre-
*1472
dispute arbitration agreement (not in a Form U-4) mandating arbitration of all employment disputes.
The opinion is notable not so much for its holding, but rather for its commentary on
Gilmer
and on mandatory arbitration. The court’s decision to enforce the arbitration agreement rested largely on the fact that “the Supreme Court has made clear that, as a general rule, statutory claims are fully subject to binding arbitration, at least outside the context of collective bargaining.”
Id.
at 1478. Although
Gilmer
could not be read to permit arbitration agreements to waive just any right — for example, to bring Title VII claims in some forum or to have access to a neutral forum — concerns of that nature and magnitude were absent in both
Gilmer
and the case before the court.
Id.
at 1478. Accordingly,
Cole
had to follow
Gil-mer
’s prescription that “an employee who is made to use arbitration as a condition of employment effectively may vindicate [his or her] statutory cause of action in the arbitral forum.”
Id.
at 1482 (quoting
Gilmer,
We are ... cognizant of the numerous concerns that have been voiced by arbitrators, legal commentators, and the Equal Employment Opportunity Commission (“EEOC”), and National Labor Relations Board (“NLRB”) regarding the potential inequities and inadequacies of arbitration in individual employment cases, as well as their concerns about the competence of arbitrators and the arbitral forum to enforce effectively the myriad of public laws protecting workers and regulating the workplace. Nonetheless, in this case, we are constrained by Gilmer to find the arbitration agreement enforceable. We do not read Gilmer as mandating the enforcement of all mandatory agreements to arbitrate statutory claims; rather, we read Gilmer as requiring the enforcement of arbitration agreements that do not undermine the relevant statutory scheme. The agreement in this case meets this standard.
Id. at 1467-1468 (emphasis added) Thus, the Cole Court acknowledged that its hands were tied by Gilmer. 10
*1473
As clarified by
Cole, Gilmer
stands for the proposition that courts must enforce arbitration agreements that are consistent with the statutory scheme of the claims they cover. The decisions between
Gilmer
and
Cole
concur with this basic proposition. Where courts have differed, however, is on an issue that neither
Gilmer
nor
Cole
addressed: whether Congress has established in Title VII a prerequisite to mandatory arbitration — the claimant’s knowing waiver of the right to press her Title VII claims in court.
Compare Prudential Ins. Co. v. Lai,
2. The Ninth Circuit’s Formulation in Lai — A Knowing Agreement
The Ninth Circuit in
Lai
held that “a Title VII plaintiff may only be forced to forgo her statutory remedies and arbitrate her claims if she has knowingly agreed to submit such disputes to arbitration.”
The court agreed. While Gilmer and its progeny held that individuals may contract to arbitrate employment disputes, Congress mandated that this agreement be “knowing.” Id. at 1304. The court gleaned Congress’ intent from the legislative history to Title VII’s post-Gilmer amendment, section 118 of the 1991 Civil Rights Act. Section 118 states that “[w]here appropriate and to the extent authorized by law, the use of alternative dispute resolution, including ... arbitration, is encouraged to resolve disputes arising under the Acts or provisions of Federal law amended by this title.” Civil Rights Act of 1991, Pub.L. No. 102-166, § 118 (set forth in the historical and statutory notes following 42 U.S.C. § 1981 (1994)). In attempt to clarify the “where appropriate” language, the court cited one House Report explaining:
The committee emphasizes ... that the use of alternative dispute resolution mechanisms is intended to supplement, not supplant, the remedies provided by Title VII. Thus, for example, the committee believes that any agreement to submit disputed issues to arbitration, whether in the context of a collective bargaining agreement or in an employment contract, does not preclude the affected person from seeking relief under the enforcement provisions of Title VII.
*1474
H.R.Rep. No. 40(1) 102nd Cong., 1st Sess.,
reprinted in
1991 U.S.C.C.A.N. 549, 635. The court also considered Senator Dole’s declaration in the Congressional Record that § 118 encourages arbitration only “where the parties knowingly and voluntarily elect to use these methods.” 137 Cong. Rec. § 15472, § 15478 (daily ed. Oct. 20, 1991). Combining the “where appropriate” language and the House Report with Senator Dole’s “knowing and voluntary” proclamation, the court determined that Congress requires a knowing agreement to arbitrate Title VII claims.
Id.
at 1305. The court observed that no language in the U-4 arbitration clause or the NASD arbitration rules mentioned discrimination claims.
Id.
Indeed, the Seventh Circuit had held as a matter of law that “the NASD provision relevant to this appeal did not cover employment disputes.”
Id.
at 1305 (citing
Farrand v. Lutheran Brotherhood,
Citing Lai, Farrand and section 118 of the 1991 Civil Rights Act, Cremin urges this Court to use the “knowing” analysis to find that she did not waive her rights to proceed in court. Lai and its study of legislative history, however, do not aid Cremin, for two reasons. First, Lai’s approach is inconsistent with the Supreme Court’s Gil-mer decision, as several district courts have recognized. With Lai as the only federal appellate case on point, and no ruling from the Seventh Circuit, this Court must seriously consider Lai’s lower-court opposition. Second, and most important, both Lai and Farrand are factually and legally distinguishable from this case. Both were interpreting NASD arbitration rules before they were amended explicitly to cover employment disputes, and none of the plaintiffs in those cases were members of the NYSE, which has long had an employment dispute arbitration rule. Therefore, applying a “knowing” standard to Cremin produces a result different from these decisions.
3. Lai Is Inconsistent with Gilmer
The prevailing view is that
Lai
is incompatible with the Supreme Court’s decision in
Gilmer,
ignores core principles of contract law, and inappropriately used legislative history to contradict plain statutory language. This view is most forcefully articulated in
Beauchamp v. Great West Life Assurance Co.,
slender reed[] upon which to rest the weighty and novel conclusion that an arbitration clause is only binding when the claimant has actual knowledge that his particular employment claims will be covered by the agreement.
Id.
at 1096. The House Report Lai accorded so much authority was actually based on a Supreme Court decision,
Alexander v. Gardner-Denver,
Other district courts echo
Beauchamp’s
view of Lai, or attack the authority on which it rests. For example,
Hall v. Metlife Resources,
The interpretation of § 118 as expressly approving and encouraging arbitration'prevails in this Circuit as well.
See Nieminski v. John Numen & Co.,
Regardless of any personal views this Court may have regarding Gilmer, we are obligated, as a district court, to give it full force. Although this Court is sympathetic to the Lai approach, we find that the substantial authority refusing to follow Lai is more in keeping with the principles Gilmer espoused. We are also mindful of the D.C. Circuit’s careful adherence in Cole v. Bums Int’l Security Services to Gilmer, despite some reservations about the decision’s effects.
4. Cremin Knowingly Agreed to Arbitrate
Moreover, even if we were to follow Lai’s “knowing” waiver analysis, it would not save Cremin’s remaining claims from defeat. That is because, unlike the plaintiffs in Lai, Cremin is governed by the NYSE and recent NASD arbitration rales explicitly covering employment disputes.
In
Wojcik v. Aetna Life Ins. & Annuity Co.,
Cremin relies on both Kresock and Far-rand in arguing that her signature on the U-4 does not prevent her from challenging its arbitration clause. If it were otherwise, she claims, these two decisions “would have dispatched the plaintiffs who had signed manda *1476 tory arbitration agreements to arbitration, rather than analyzing the facts and law and holding that their claims could be heard in the District Court.” PL Resp. at 22. Her focus on these cases is misguided.
In
Kresock,
the plaintiff not only signed a U-4 before the 1993 NASD arbitration amendments took effect, but also sued before the amendments’ effective date, and complained of conduct occurring before the effective date.
Kresock,
Cremin, like the Kresock and Farrand plaintiffs, signed a U-4 containing a broad compliance clause that required her to abide by all present and future exchange rules. But this case differs from Kresock and Far-rand in two material respects: 1) Cremin sued and complained of conduct occurring after the NASD’s October 1993 amendments; and 2) she is a member of the NYSE, which has long had an arbitration rule covering employment disputes. First, in contrast to-both the Kresock and Farrand plaintiffs, Cremin filed suit in 1996, well past the effective date of the 1993 amendments changing the NASD Code of Arbitration Procedure to include employment disputes. In addition, the discriminatory conduct upon which Cre-min bases her Title VII claims occurred up through 1995: she allegedly experienced pregnancy discrimination and was denied maternity leave benefits in conjunction with the birth of her child in May 1995; after Cremin returned to work, she was allegedly forced to turn over all her accounts to male brokers, and was terminated shortly afterward. Therefore, the “relevant conduct” in Cremin’s case occurred after the 1993 amendments requiring arbitration of employment disputes took effect. Under Kresock, Wojcik, and the U-4’s compliance clause, she is bound to them. Second, in contrast to the plaintiffs in Farrand and Kresock, Cremin is a member of the NYSE. By the time Cre-min signed the U-4 and registered with the NYSE in 1983, it had promulgated a rule providing specifically for arbitration of employment disputes. See Mot. Defs. Merrill Lynch and Ganotti to Dismiss, Ex. 3. Therefore, even if we discounted the U-4’s compliance clause binding Cremin to future exchange rules, she would still be subject to the this NYSE rule, which has been in effect ever since she signed the form.
Just recently, a Northern District of Illinois court was faced with a situation almost identical to the one before us.
See Nieminski v. John Nuveen & Co.,
The court rejected this argument. By virtue of signing the U-4 and its compliance clause, Nieminski had agreed to abide by all NASD rules, now and in the future. Id. at *5. By the time Nieminski was fired, the NASD Arbitration Code had been amended to cover any dispute arising out of her employment. Id. Citing Wojcik, the court held:
*1477 [W]hen at least some of the allegedly discriminatory conduct took place after the date of the amendments and when suit has been filed after the date of the amendments, the amendments to the NASD arbitration Code apply and arbitration of employment disputes can be compelled.
Id. Therefore, by virtue of the compliance clause and the timing of her suit, Nieminski had knowingly agreed to arbitrate her Title VII claims. Id. at *4-5. The court distinguished La% Farrand and Kresock because each case was filed “prior to the date of the amendments and involved facts occurring entirely before that date.” Id. at *5.
The court also grounded its decision in Illinois contract law. Nieminski’s signature on the U-4 meant that she had agreed to follow all present and future NASD rules. Even if she was unaware of the full scope of those rules, she could not complain that the agreement to abide by them was not “knowing.”
Id.
at *4. Under Illinois law, “[a] party may not avoid a contract fairly entered into because of a mistaken opinion of its legal effect.”
Id.
(citing
Bruner v. Illinois Central R.R. Co.,
Reading
Nieminski
together with the Ninth Circuit’s decision in Lai, we must find that Cremin’s consent to arbitrate employment disputes under the U-4 and exchange rules was knowing. First, as we explained above, Cremin is subject to both the NYSE rule and the NASD 1993 amendments mandating arbitration of employment disputes. Both Cremin and the
Nieminski
plaintiff sued based on discrimination that occurred, at least in part, after the October 1993 NASD amendments. And both filed suit in 1996. Consequently, the timing of the “relevant conduct” in each case removes the concerns of applying the NASD amendments retroactively.
11
Second, contract law prevents us
from
finding that Cremin did not knowingly agree to arbitrate her Title VII claims. Cremin is well-educated, with an MBA in finance from Northwestern University, and intelligent, alleged to have “enjoyed an excellent reputation both with regard to the high quality of her work and her conscientious devotion to her job.” See Form U-4; Compl. ¶ 2. The arbitration clause in the U-4 she signed was conspicuous and presented in clear language, as was the compliance clause on the same page. Both were proceeded by capital letters urging her to read the provisions “very carefully.” Under these circumstances, it is fair to apply the elementary rule of contract law that one is presumed to know the contents of a signed agreement.
See Beauchamp,
To summarize, we are unable to sustain Cremin’s claim that the U-4 arbitration clause violates her statutory rights under the 1991 Civil Rights Act. First, we cannot accept Lai and its interpretation of the Civil Rights Act’s legislative history as consistent with the Supreme Court’s decision in Gilmer. Second, Lai is distinguishable from this case because it involved plaintiffs who were not NYSE members, and a lawsuit filed before the NASD Code was amended to include employment disputes. Because Lai’s “knowing” analysis was based on Farrand, a decision that came down before the NASD Code was amended, that analysis has no force here. Therefore, we dismiss Cremin’s statutory claims in Count III.
We realize that this ruling eliminates Cre-min’s ability to challenge prospectively the securities industry’s arbitration procedures. Nevertheless, our decision does not sound the death knell for Cremin’s civil rights claims.
For one, the D.C. Circuit in
Cole v. Burns Int’l Security Services
recognized that both the Federal Arbitration Act, 9 U.S.C. § 10(a), and case law provide for meaningful judicial review of public law issues decided
*1478
by arbitrators. 1997 U.S.App. 2223, at *67-73. In addition to the grounds laid out in the Arbitration Act, courts may set aside arbitration awards if they are contrary to “some explicit public policy” that is “well defined and dominant” and determined “by reference to the laws and legal precedents.”
Id.
at *68. (citations omitted). In fact, arbitration awards have been vacated in the collective bargaining context “when they were inconsistent with public laws like Title VII.”
Id.
at *69 n. 19.
Cole
also cited the Supreme Court’s statement that courts may vacate arbitration awards that are in “manifest disregard of the law,”
see First Options of Chicago v. Kaplan,
Secondly, as Cole observed, arbitration has its own set of benefits in the employment context:
[F]or all of arbitration’s shortcomings, the process, if fairly conducted, is not necessarily inferior to litigation as a mechanism for the resolution of employment disputes. As the Dunlop Commission [Department of Labor Commission headed by former Secretary of Labor John Dunlop] recognized: “Litigation has become a less-than ideal method of resolving employees’ public law claims-[they] must endure long waiting periods as the overburdened court system struggles to find time to properly investigate and hear the complaint. Moreover, the average profile of employee litigants ... indicates that lower-wage workers may not fare as well as higher-wage professionals in the litigation system....”
Arbitration also offers employees a guarantee that there will be a hearing on the merits of their claims; no such guarantee exists in litigation where relatively few employees survive the procedural hurdles necessary to take a ease to trial in the federal courts.
Id. at *73-74 (quoting Commission On the FutuRE of WorkeR-Management Relations, Report and Reoommendations 30 (1994)) (alterations added by court).
Finally, our decision preserves the possibility that Cremin might remain in court; dismissing Count III does not have the effect of compelling arbitration. We simply find no basis to issue a declaratory judgment that mandatory arbitration deprives Cremin of constitutional due process and statutory rights. And we express no opinion on the validity of Count IV of the complaint, which seeks to void the U-4 arbitration clause under contract law and equitable theories. In short, our decision does not render the arbitration clause conclusively valid. It simply prevents Cremin from using the Constitution or the 1991 Civil Rights Act to challenge it.
CONCLUSION
For the foregoing reasons, the defendants’ motion to dismiss Count III of Cremin’s complaint is granted. Defendants NYSE and NASD are dismissed from this action because that is the sole count in which they are named. Cremin may choose, if she wishes, to file an appropriate amended complaint consistent with this opinion on or before March 10, 1997. A status hearing will be held on March 11, 1997 at 9:15 a.m. to determine the most efficient way to proceed with a fair resolution of this lawsuit.
Notes
. The NASD is a private corporation in charge of regulating the over-the-counter securities market. Compl. II6. A self-regulatory organization ("SRO"), it has the authority to adopt and enforce • standards of conduct for the securities firms that are its members. Id. Despite its self-regulating status, the NASD must submit its rules and regulations, including those relating to arbitration, to the Securities and Exchange Commission for approval. Id.
The NYSE is a corporation that provides facilities and services to its members for the purchase and sale of securities. Id. ¶ 5. Like the NASD, the NYSE is a SRO that polices its members’ conduct. Id. It also must secure the SEC’s approval for all rules and regulations. Id.
. The Court draws the facts in this section from two sources. One, of course, is the complaint, whose allegations we are bound to accept as true when deciding a motion to dismiss.
See Doherty
v.
City of Chicago,
There is, however, one alleged inconsistency that we must resolve between the complaint and the U-4. Cremin states in her complaint, upon information and belief, that the Form U-4 she signed did not have an arbitration clause. Compl. ¶ 36. But the copies of the U-4 attached to the defendants’ motions and bearing Cremin’s signature do contain such a clause. “[Wjhen a pleading is directly at odds with a document that is properly before the court, the document controls.”
Wright v. Associated Ins. Cos.,
. Merrill Lynch is a member of both the NYSE and NASD.
. As a registered representative of NASD member Merrill Lynch, Cremin is an “associated person.” NASD Code By-laws, Art. 1, ¶ (q);
see Wojcik,
. While Merrill Lynch and Gannotti filed a joint motion, the NASD and NYSE each filed separate briefs. The briefs are substantively similar and consistent. Accordingly, for convenience's sake, the Court will refer to the defendants and present their arguments collectively.
. Originally, Merrill Lynch and Gannotti briefed this motion as a motion to dismiss and for an order compelling arbitration, addressing a number of claims in Cremin’s complaint. The NASD and NYSE, having been named only in Count III, simply moved to dismiss that Count. Instead of filing a response, Cremin moved to strike the motions to dismiss, contending that Merrill Lynch and Gannotti’s motion impermissibly addressed the merits of her case and that the Exchanges' motions failed to assume the truth of her allegations. This Court determined that, in the interests of judicial economy, it would be most prudent to focus on Count III, and issued a minute order to that effect on October 11, 1996. In the minute order, the Court requested the parties to brief the state action issue and the effect of the Supreme Court’s decision in Gilmer. The parties did so, and, accordingly, this opinion is limited to evaluating whether Count III and the stock exchange defendants should remain in the complaint.
While these motions were still pending, Cre-min attempted to file an amended complaint converting the suit into a class action. Believing that the class complaint would moot the challenge to mandatory arbitration, the Court struck the complaint with leave to refile any appropriate amended complaint after the opinion was issued. We invited the plaintiff to file a motion to reconsider this ruling along with a supporting *1465 brief addressing whether the class would have standing to challenge exchange arbitration rules. She did so. After reading their submission, the Court finds no merit in the argument that the class would have standing. We therefore deny the plaintiff’s motion to reconsider, but, again, invite her to file an amended complaint consistent with this opinion.
. The other authorities Cremin relies on to establish state action under the registration/arbitration requirement theory are equally unavailing.
Moose Lodge v. Irvis,
This argument lacks merit. First, the Supreme Court used its decision in
Shelley v. Kraemer,
Cremin’s citation to
Abood v. Detroit Board of Educ.,
. Moreover, the sources Cremin uses to back her statement that "the SEC has played an active role” in cultivating mandatory arbitration all date 1989 and later. See PI. Resp. at 8. They therefore bear not at all on the question of state action in 1982.
. Cremin cites only one case subjecting exchange rulemaking to due process constraints.
See Intercontinental Indus. v. American Stock Exch.,
. Ironically, Cremin called this Court’s attention to Cole by filing it as supplemental authority. She contends that the case is relevant to her claim that the securities industry’s mandatory arbitration scheme violates her due process rights by charging claimants "onerous and exorbitant filing fees and forum fees, which have exceeded $80,000 in employment disputes.” PI. Resp. at 17. She cites Cole as holding that "Gilmer would have been different if there were evidence that securities industry employees were required to pay forum fees in order to gain access to the mandatory arbitration process.” PI. Mot. Leave to File Supp. Auth. ¶ 4. (citing Cole, 1997 U.S.App. Lexis 2223, at *5).
Cole held nothing of the sort, and, in fact, operates to defeat Cremin's “exorbitant fee” claim. The holding of Cole is that employers may not force an employee to sign a pre-dispute arbitration agreement, under which only the employer can compel arbitration, and also require the employee to pay all or part of the arbitrators' fees. Id. at *5-6 & n. 1. Cole was not a securities industry employee; he was applying to be a security guard. Id. at *8. He did not sign a U-4; rather, he signed a contract that gave his employer the sole right to compel arbitration of employment disputes before the American Arbitration Association, and which the court could have interpreted as requiring the employee to pay arbitrators’ fees upwards of $700 per day. Id.at *8-9, *47-55 & n. 9. To salvage the arbitration agreement, the court held that it had to be read to place the arbitrators' fees on the employer’s shoulders. Id. at *66-67. So interpreted, the agreement was enforceable. Id.
Significantly, the court took pains to distinguish this fee scheme from the stock exchange arbitration context. It observed that in Gilmer, fees were not an issue because "under NYSE Rules and NASD Rules, it is standard practice in the securities industry for employers to pay all the arbitrators’ fees." Id. at *59 (citing Daily Labor Rep. (BNA) No. 93, at A-3 (May 14, *1473 1996)). Moreover, "[e]mployees may be required to pay a filing fee, expenses, or an administrative fee, but these expenses are routinely waived in the event of financial hardship.” Id. The court concluded:
Thus, in Gilmer, the Supreme Court endorsed a system of arbitration in which employees are not required to pay for the arbitrator assigned to hear their statutory claims. There is no reason to think that the Court would have approved arbitration in the absence of this arrangement.
Id. at 59-60. Cole essentially refutes Cremin's claim that the NYSE and NASD arbitration system forces her to pay excessive fees. Even if the fees were "onerous and exorbitant,” they would not render the U-4 arbitration agreement void; instead, the court would interpret the agreement as making fees the responsibility of the employer.
Plaintiff’s own evidence also thoroughly undermines her claim. Of the thirty-plus copies of arbitration awards that Cremin attached to her response brief, only two assessed forum fees against the claimant. See PI. Resp. Ex. I. The amounts were $12,000 and $4800. In both cases, the arbitrators had dismissed the claims in all respects, and given no award to the claimant. This belies Cremin’s assertion that exchange arbitrators routinely assess claimants fees that "exceeded $80,000,” "even [against] those who prevail.” PI. Resp. at 17; Compl. ¶ 27(i). Contrary to this claim, the highest forum fee assessed in plaintiff's exhibit was $42,900, against the respondent-employer.
Given our reading of Cole, we commend plaintiff for bringing this case to the Court’s attention.
. The case for holding that Cremin knowingly agreed to arbitrate employment disputes is even stronger than in Nieminski. The plaintiff in that case was not a member of the NYSE, and, as such, was not subject to the earlier NYSE rule calling for arbitration of employment disputes.