Seawright v. American General Financial Services, Inc.

require- registration subject to to be Therefore, state the SORA.

ments of does that a sex offender

court determines only to the public a threat to pose on the remains the offender

extent Furthermore, de- the state court’s

PSOR. guarantee not a

termination the de- Despite threat. poses no

offender SACA, it remains under

termination provide to seek “to Michigan

rational people of [Michi- and the

law enforcement comprehensive, appropriate,

gan] with per- to monitor those means effective danger.” potential pose such

sons who 28.721(a). Therefore, plaintiffs’

Id. challenge fails. protection

equal

IV. reasons, affirm the we foregoing

For the court. of the district

decision SEAWRIGHT, Plaintiff-Appellee,

Lisa GENERAL FINANCIAL

AMERICAN INC.,

SERVICES, American General

Finance, Interna and American Inc., Defendants-Appel Group,

tional

lants.

No. 07-5091. of Appeals, States Court

United Circuit.

Sixth

Argued: Sept. 13, 2007. and Filed: Nov.

Decided April

November 1978 until 2005.1 AGF Seawright’s employment terminated filed April response, District suit the United States Court Tennessee, alleg- the Western District discharged her in violation of ing that AGF law and the Tennessee antidiscrimination Act, Leave Family and Medical U.S.C. seq. 2601 et compel arbi- AGF moved to tration, an arbitration proffering previously had ment to which Seawright agreed that she agreed. denies At is whether an to arbitrate. issue Seawright, ment exists between AGF and so, and if whether the is en- court found that no forceable. The district enforceable existed. We hold knowing continuation employment after the effective date of the program acceptance constituted contract to of a valid and enforceable arbi- therefore reverse the district trate. We compel court’s denial of AGF’s motion to Ballmer, Littler Jody A. ARGUED: arbitration. Illinois, Mendelson, Appellant. for Chicago, Stevenson, Norwood, Howard & B. David I Tennessee, Memphis, Appel- for Atchley, Ballmer, Jody A. Mar- BRIEF: lee. ON April began notifying In AGF its Mendelson, Ross, Illi- Chicago, Littler issa employees implementing that it would be Stevenson, nois, David B. Appellant. for (“EDR”) Employee Dispute Resolution Norwood, Atchley, Memphis, Howard & Program. It introduced the EDR Pro- Tennessee, Appellee. gram through a series of announcements meetings. company and informational BOGGS, Judge; Before Chief employees about the EDR first informed SUTTON, Judges. MARTIN and Circuit Program April a “Home C.J., BOGGS, opinion of delivered the Bulletin,” publication circulated to Office SUTTON, J., joined. court, in which offices, company including all the office 979-81), MARTIN, (pp. delivered J. Seawright manager. where was a branch dissenting opinion. separate time, Around the same AGF also mailed informing them employees letters to its

OPINION Program that the EDR would become ef- BOGGS, Judge. Chief fective June 1999. Included with the brochure, an informational letter was Lisa worked for American (“AGF”) Financial from which stated: General Services Services, inlegrated joint employer under Tennessee or American General Financial Finance, Inc., and Ameri- American General law. Group, operate can International Inc. as Employee Dispute paragraphs regarding binding Resolution nature The AGF resolving Program is the sole means of of the arbitration and reiterat- disputes employment-related that, between ing “[sleeking, accepting, or continu- you company you and the or and anoth- ing employment you with AGF means that employee, including disputes er for le- agree employment to resolve related gally protected rights such as freedom against company or another em- discrimination, retaliation, from ployee through process instead of harassment, prohibited unless otherwise through system.” the court by law. continued her free to consult or file a You are still with until AGF AGF terminated her on complaint appropriate state or April against 2005. She filed suit AGF EEOC, as the re- agency, federal such shortly responded thereafter and AGF your garding legally protected rights. with a motion to compel arbitration. However, Program must be used Seawright’s answer to the motion to com- if you instead of a trial are not satisfied arbitration, pel acknowledged the government agen- with the results of the (1) argued above facts but she did not cy process, prohibited unless otherwise assent EDR Program and the. by law. (2) bargained-for exchange; there was no accepting, Seeking, continuing or em- did not enter a agreement into written ployment you with AGF means required by as the Federal Arbitration agree to resolve related (3) Act, (“FAA”), seq.; 9 U.S.C. 1 et and against company or another alternative, in the arbitration employee through process instead of ment is void because it is a contract of through system. the court adhesion or unconscionable. The district group AGF then held informational meet- agreed court with argu- first A ings explaining program. pamphlet ment, holding “merely receiving infor- employees during distributed to the acknowledging pro- mation and EDR meeting repeated informational the infor- gram is not tantamount to assent. There Seawright mation signed above. at- bargained exchange, was no [Sea- and tendance acknowledging sheet that she wright] ability had no to affect the terms had attended an informational session and company’s policy.” Seawright v. copy Employment received a of the AGF Serv., DV, 4 Amer. Gen. Fin. No. 06-2339 EDR Dispute Pamphlet. Resolution The (W.D. 2006) (order 22, denying Tenn. Dec 1, Program went into effect on June compel stay pro- motion to arbitration and employee. remained an AGF It ceedings). thus denied the order to years program Two after the went into compel arbitration on the basis that there effect, in June AGF mailed its em- agreement. was no and enforceable valid ployees a letter that reminded them that appeals. Ibid. AGF now Program the EDR in effect was still and explained how to locate additional informa- II program company’s tion on the on the We review de novo district intranet website. The letter also included compel court’s decision whether arbitra EDR summarizing brochure Pro- pursuant Corp. tion to the FAA. v. Masco gram. The brochure was similar to the Zurich Am. Ins. 382 F.3d other two brochures had been distrib- (6th Cir.2004); by mail and at Burden v. Check Into Cash uted the informational LLC, meetings. Kentucky, It also included the same three 267 F.3d of Stores, Because arbitration City Cir.2001); v. Circuit Morrison banc). contracts, Cir.2003) (en fundamentally we review are 646, 675 317 F.3d agreement

enforceability of arbitration Ill of applicable state law according to Options First Chi formation. contract provides: FAA 938, 943-44, Kaplan, v. 514 U.S. cago, Inc. any in maritime provision A written (1995). 1920, 131 L.Ed.2d 985 115 S.Ct. evidencing a contract or a transaction applicability on the Any arguments based to settle involving commerce transaction are, at issue of the FAA to the controversy thereafter by arbitration course, evaluated accordance or transac- of such contract arising out four case law. makes federal tion, perform the whole the refusal or and based on state contract law arguments thereof, anor any part or the FAA. Sea- argument a fifth based on an exist- to arbitration writing to submit are: arguments contract law wright’s state such a controversy arising out of ing (1) agree valid arbitration there was no refusal, transaction, contract, shall be actually assent ment because she did not enforceable, valid, irrevocable, save and (2) Program; EDR there was no to the at law or grounds as exist such upon because there valid contract. equity for the revocation (3) consideration; if there had was no even (2006). section of the § 2 This 9 U.S.C. consideration, the arbitra been assent policy favor- FAA the national “embodies it is unenforceable because places ing arbitration (4) alternatively, illusory; and the arbi footing with all other equal is unenforceable be tration Cashing, Inc. Buckeye Check contracts.” an unconscionable contract of cause 440, 443, 126 S.Ct. Cardegna, Seawright’s argument under adhesion. (2006). While 163 L.Ed.2d the FAA is that she did not enter into “the liberal federal respect must courts by Fed required written as agreements,” favoring arbitration policy by address begin eral Arbitration Act. We Hosp. Mercury v. H. Mem’l Moses Cone on ing Seawright’s arguments based state 24-25, 1, 103 S.Ct. Corp., 460 U.S. Const. law. contract (1983), 927, 765 arbitration is 74 L.Ed.2d and a cannot be “matter of contract A. Assent dis required to submit to at hand whether agreed so to sub The issue pute which he has not employment continued mit.” AT T Techs. v. Communications & Am., 643, 648, law 106 AGF constituted assent. “Tennessee 475 U.S. Workers of (1986) validity con 1415, (citing recognizes the of unilateral 89 L.Ed.2d 648 S.Ct. tracts, by acceptance America v. which is indicated Warri United Steelworkers of Co., 574, v. action under the contract.” Fisher GE Navigation or & 363 U.S. Gulf (1960) 891, 582, 1347, Sys., F.Supp.2d Med. 276 895 4 L.Ed.2d 80 S.Ct. (M.D.Tenn.2003). The written materials America and United Steelworkers of 570, 564, accompanying the arbitration Mfg. 363 U.S. American (1960)). Thus, 1363, clearly employment stated that continued 4 L.Ed.2d 1432 S.Ct. after the effective date of the EDR Pro question of whether underlying employee’s ac gram is to be “decid would constitute parties agreed to arbitrate court, ceptance AT of the to arbitrate. not the arbitrator.” & ed Thus, law, Seawright Tennessee ex T Workers under Techs. v. Communications of Am., 643, 649, 1415, continued pressed a valid assent when she S.Ct. (1986). for AGF. to work L.Ed.2d 648 acknowledged specifically The district court against relying cautioned on its decision cases with different facts: “The “[generally, employment continued consti course, distinguishable, case bar is of acceptance employer’s tutes of an arbitra from cases in which employer-distributed policy.” Seawright, No. 06-2339 DV employees materials told their con- Nevertheless, exclusively relying at 3. tinuing to work accep- would constitute case, an unpublished Lee v. Red Lobster employer’s dispute tance of the resolution America, Fed.Appx. Inns plan.” Id. at 163 n. 4. The case cautioned Cir.2004), the district court concluded that is, against course, exactly the footnote “merely receiving information and ac our case. the EDR knowledging program is not tan Seawright also relies on Miller v. Am. tamount to assent.” This misstates the 2022536, Corp., Gen. Fin. 2002 WL question issue. The is not whether (E.D.La. Dist. Sept. U.S. LEXIS 16724 mere receipt accep offer constitutes 2002) to demonstrate that she did not ex- continuing tance but whether an action— press However, valid assent. the court in accep one’s constitute —can Miller based its decision on Louisiana law, tance. Under Tennessee continued law, state contract signifi- which differs employment can constitute acceptance. cantly from Tennessee state contract law. Fisher, F.Supp.2d (“By at 895 continu In special Louisiana “when formalities are GE, ing plaintiffs accepted to work at contract, prescribed for a the same formal- agreement], the terms of [the ities are required accep- for an offer or contract.”); binding Byrd see also v. CIG tance intended to form that contract.” La. Healthcare, NA 2002 WL 32059026 at *2- (West 2001) Ann. Civ.Code Art.1927 cmt. (Feb. 2002 U.S. Dist. LEXIS *7 Thus, c. the court in Miller reasoned that Tenn.) terms, (“By 2002 E.D. ‘accept its because the FAA required ing employment being eligible to re in writing, to be Louisiana contract law in compensation ceive increases and bene required further acceptance employee fits’ binds [an] the defendant [of Tennessee, in writing. be company] to employment-related arbitrate however, acceptance of a written claims.”) (quoting company’s the defendant performed by ment can be action under handbook). Fisher, F.Supp.2d the contract. Thus, inapposite is Miller to the case Furthermore, Lee distinguishable is at hand. present from the impor- case due to two

tant differences in its facts that the district Noticeably absent from Sea- First, court did not mention. the wright’s brief is a discussion of the “know in ment issue Lee did not contain voluntary ing requirement and waiver” es provision stipulated employ- that continued in tablished this circuit Morrison v. Thus, ment would acceptance. constitute Stores, Inc., City Circuit 317 F.3d 646 agreement the accepted by could not be Cir.2003) (en banc). Morrison, In the Second, unilateral action. unlike Sea- court applied “ordinary principles contract wright, in plaintiff explicitly the Lee told determining in whether” a binding arbitra her that boss she did not assent to the tion that included a waiver of a agreement.2 Additionally, the court in Lee in right to sue court was valid. Id. at 668 offer, Seawright 2. We explicitly note that did not lence in the face of an but from her object only is, to the arbitration performance under the contract —that her this case from Lee. Sea- distinguish order to employment. continued wright’s acceptance came not from her si- Moms, Inc., effectively that all Philip require v. 67 would arbitra- (citing Adams Cir.1995)). to be signed In deter- be enforce- F.3d in conflict employee “knowingly able. This would be with both mining whether plain reading the the of the statute voluntarily” right, waived the and with and “(1) plaintiffs past precedent interpreting the experience, statute. court considers: (2) that, education; Accordingly, although the we find background, and Sea- waiver, plaintiff wright sign accep- to consid- did not her time the had amount of waiver, of EDR sign including Program the tance the stated er to whether —which parties that employee opportunity had an to the waived their whether the (3) lawyer; clarity right knowing the of sue court—was and to consult with (4) waiver; voluntary. consideration for the waiv- (5) er; totality of circum- as as well B. Consideration Morrison, In at 668. stances.” Id. plaintiff knowingly court found Addressing the issue of consid voluntarily right and waived her to sue eration, stated the district court that the highly based fact that she “a on the was “bargained lacked for ex managerial who educated change.” The district court seemed to understanding the capable terms of the of the fact base conclusion on that Sea- agreement” the “waiver of the and wright ability no to affect “had the terms in federal right suit court was to file fact, of the That company’s policy.” how is plain.” Seawright similarly situated: ever, is irrelevant to whether there is a educated, managerial employee, She is an bargained-for exchange. Under Tennes who capable understanding law, “[m]utuality promises see contract Also, provisions. EDR like Program’s ‘ample’ for a A consideration contract. (in Morrison, ample had time promise mutual ‘initself would constitute a ” months) case, two between Pyburn sufficient consideration.’ v. Bill of the EDR Pro- AGF’s announcement (Tenn.Ct. Chevrolet, Heard 63 S.W.3d 351 gram Program’s and the commencement App.2001) Rodgers v. (quoting Southern could during which she have consulted Newspapers, 214 Tenn. attorney decided she did not (1964)); S.W.2d see also Burac rights. Finally, wish her to waive zynski Eyring, 919 S.W.2d 321 n. 6 clearly EDR stated Program employ- (Tenn.1996). issue, ees, by Program, to the EDR agreeing process the arbitration was binding on waiving rights would their be to sue employer employee, regardless both federal court. Thus, requested who employ arbitration. equally er and employee obligated were signaled Though Morrison her assent to disputes falling arbitrate those within the agreement through signa- coverage plan. enough This signaled ture her assent mutuality obligation ensure and thus action, in nowhere through Morrison does constitute consideration. the the court hold waiver must be express writing. Indeed, such a Illusory Contracts C. requirement likely would be inconsistent with law FAA interpreting Though Seawright’s federal case the brief does below, itself. explicitly argue point, As we elaborate arbitration not this her state FAA only under the be ment that “in the employee’s need contrast to written, necessarily signed. inability If EDR challenge program, to the equate “knowing Companies court were to and volun- maintained the to right tary” “express change program any written” then we or terminate the at

975 6-7) (Appellee’s might time” Br. be con- void because it ais contract of and/or argument agreement strued as an that the adhesion entered into with unequal bar- illusory and therefore void. Tennes- gaining power and because is substan- requires see law that a contract not be tively unconscionable.” (Appellee’s Br. is, illusory, that it impose genuine 22). Supreme The Court has made it clear obligations parties. on both Parks v. Mor inequality in bargaining pow- “[m]ere ris, 545, 914 S.W.2d 550 (Tenn.Ct.App. er, however, is not a sufficient reason to 1995) (“If parties one or both to a contract hold that are never right have the to cancel or terminate the enforceable in the employment context.” agreement, then the contract lacks mutual Gilmer v. Lane Corp., Interstate/Johnson unenforceable”) (internal ity and is quota 20, 32, 1647, 500 U.S. S.Ct. omitted). In v. Ryan’s Family Floss (1991). L.Ed.2d 26 The Court went on to Houses, Inc., Steak 211 F.3d 306 Cir. write, course, “Of courts should remain 2000) the court found the arbitration attuned to well-supported claims that the agreement “fatally to be indefinite” be agreement to arbitrate resulted from the employer cause the right “reserved the to sort of fraud or overwhelming economic applicable alter the procedures rules and power provide that would grounds “for the any obligation without notify, much less any 33, revocation of contract.” Id. at receive consent employees. from” the Id. (citing S.Ct. 1647 Mitsubishi Corp. Motors at 315-16. The Inc., v. Soler Chrysler-Plymouth, this case is distinguishable. While the de 614, 627, 105 S.Ct. 87 L.Ed.2d 444 companies fendant right reserved the (1985)). Thus, to determine whether a time, terminate the EDR they also contract is agreed to unenforceable we must follow by be bound the terms of the days for 90 after Tennessee law giving governing reason the enforceabili- able notice of the termination and as to all ty of contracts of adhesion.” disputes known arising before the date Thus,

termination. J.A. compa Supreme 341. Court of Tennessee nies were bound the terms for at least has defined an adhesion being contract as days after came into “a standardized form offered on what effect.3 reciprocal obligation This to arbi basis, amounts to a ‘take it or it’ leave trate least those arising affording without party the weaker a real 90-day period after the effective date of opportunity istic bargain, and under satisfies mutuality re whereby conditions the weaker can quirement. only product obtain the desired or service by submitting to the form of the contract.”

D. Contracts of Adhesion Buraczynski Eyring, 919 S.W.2d and Unconscionability (Tenn.1996); see also Walker v. Houses, Inc., Ryan’s Family Steak Cir.2005); F.3d argues that the ar Howell v. bitration Sanders, “unenforceable NHC Healthcare-Fort reality, parties' obligations mutual Program AGF had terminated the EDR date, years, have lasted for at day least five from the parties after the effective would Program's EDR effective date on June disputes arising have been bound to arbitrate April to the date of days. termination in the 90-day period, in next 90 It is this question 2005. But length of consideration is not the actual of time that mutuality obligation whether there was parties of Program, were bound EDR the time the was entered into. If constituted consideration. finding for a con- Tennessee’s standard (Tenn.Ct.App.2003). 733-34

S.W.3d merely not adhesive However, is a contract in con- employment tract of adhesion form offered it is standardized because Agree- find their Arbitration text: “To The last ele- basis. on a take-it-or-leave-it adhesive, the district court was ments adhesion, absence of a mean- “the ment of evidence that required [Plaintiffs] to cite party occupying for ingful choice employ- unable to find suitable would be must also be bargaining position,” weaker [they] sign arbi- [the ment if refused Inv. v. MRM Cooper present. (internal agreement.” Id. tration] Cir.2004). While the F.3d 493 omitted). the court quotations While fulfill the first may here at issue ment un- that the Walker held conditions, Seawright has not dem- three grounds, state enforceable on other law Applying the final element. onstrated “some concerns about the court had law, Circuit state the Sixth Tennessee final mandatory whether Plaintiffs demonstrated employer’s Cooper held that was not contract contract: ‘the ab- element of an adhesion a simi- on the failure of of adhesion based meaningful par- choice for the sence of a lar condition: bargaining posi- weaker ty occupying the ” however, adhesive, this contract To find plaintiffs Cooper Like the tion.’ Id. em- that [the must be evidence there Walker, Seawright presented has no unable to find suitable ployee] would be that she would be unable to evidence sign [the if she refused employment if had re- find suitable presented She employer’s] agreement. to the arbitration fused to be a instance, she did For no such evidence. Thus, we hold agreement. compara- for allege that she looked not a contract of adhesion. to find one. unable jobs ble but was employer prac- about

Generalizations economy cannot sub- in the modern

tices evidence. See stitute such if could Even show Farms, Andersons, v. Horton Inc. agreement was adhe that the arbitration Cir.1998) (no proce- F.3d sive, have to demonstrate she would also grain unconscionability where sell- dural Cooper, it unconscionable. evidence that present “failed to er and that Tennessee, for other alternatives searched In adhesion con F.3d at 503. none”). there were only tracts are unenforceable when the “beyond expecta at 502. are the reasonable Cooper, 367 F.3d terms ordinary oppressive person, tions of an or Ryan’s Family Steak In Walker Buraczynski, Houses, reiterated unconscionable.”4 the Sixth Circuit legislative history clearly presence or the dem- Seawright argues that the “the statute Congress’s except onstrate intention to whis- unequal bargain power can make an arbitra- unenforceable,” relying tleblower retaliation claims from Arbitra- tion Cleveland, Act, F.Supp.2d it does find that a conflict exists City Nguyen v. underlying pur- (N.D.Ohio 2002). between arbitration and the This mischaracterizes Seawright's Nguyen poses the FCA.” Id. at 647. reasoning. the court the court's Nguyen’s "unequal compel reliance on reference to employer's motion to arbi- denied the poli- bargaining power” thus taken out of con- tration because of a conflict between Moreover, explicitly Nguyen acknowl- Act text. the FAA and the False Claims cies of bargaining ("FCA”): inequality in edges that "[m]ere this Court does not "Thus while power ... is not a sufficient reason to hold plain find that the text of whistleblower

977 320; time, Pyburn, Taylor at see also 63 S.W.3d required S.W.2d is to any arbitrate at A un (Tenn.App.2001). contract is claim that might against have City “inequality conscionable when the of the Auto.”). bargain is so manifest as to shock the Seawright’s only argument that sense,

judgment person of a of common the contract was procedurally unconsciona oppressive and where the terms are so ble is her contention that there un person that no reasonable would make equal bargaining power. The finding that hand, them on the one and no honest and employee “an bargaining power had less is fair person accept would them on the oth relevant to procedural-unconscionabili er.” Hawn v. King, S.W.2d ty analysis.” Cooper, 367 F.3d at 504. (Tenn.Ct.App.1984). Courts will not en present did not evidence of force adhesion contracts which “op are pressive bearing “factors on the bargaining to the weaker or which relative obligations serve to limit the liability position and of the contracting parties, includ stronger party.” Buraczynski, of the 919 ing age, education, their intelligence, busi (Tenn.1996). S.W.2d at 320 The Tennes ness experience, acumen and and relative Supreme recognizes see Court both sub bargaining power.” (citing Ibid. Morri stantive procedural and elements of uncon- son, 666). Moreover, F.3d given Butler, scionability. Taylor v. 142 S.W.3d Seawright’s position education and as a (Tenn.2004) (“The 277, 285 determination branch manager office who had worked for that a contract or term or is is not uncon the company decades, for two and a half it scionable light setting, is made of its unlikely that she could marshal such purpose and effect. Relevant in factors evidence. This distinguishes Seawright clude contracting pro weaknesses from a low-level employee may who be cess specific like those involved more “required sign arbitration capacity, fraud, rules as to contractual and precisely at the time that he she is most ....”) other invalidating (citing causes Re willing sign anything just get job.” (Second) statement of Contract cmt. Cooper, 367 (citing Cooper F.3d (1981)). MRM Inv. F.Supp.2d 780 & argue, does not and (M.D.Tenn.2002)). n. 8 hold, this court could not that the arbitra forgoing For the we reasons find that tion agreement substantively uncon Seawright entered into a valid and en- scionable. underlying forceable to arbitrate. equitable in that it binds employer both to arbitration E. The Federal Act Arbitration and does not “limit obligations In addition to four liability stronger party” em —the arguments is unen ployer. distinguishes This the EDR Pro forceable under Tennessee state contract gram from the arbitration law, argument she asserts a fifth that a Tennessee courts have held unconsciona See, federal court cannot Butler, compel arbitration ble. e.g., Taylor v. 142 S.W.3d (Tenn.2004) pursuant to FAA because the arbitra (“City judicial Auto has a forum for practically all claims that at issue was not written as against Taylor____At could have the same required by provides: the FAA. The FAA 20, 33, Corp., are never enforce- S.Ct. able in the context.” Id. at (1991)). L.Ed.2d 26 (quoting Gilmer v. Lane Interstate/Johnson 978 any in maritime was distributed via United States mail to provision

A -written That employees. pamphlet describes the a evidencing a contract or transaction procedures, it clear arbitration makes that involving commerce to settle transaction binding the one for arbitra- controversy a thereafter by arbitration trial, tion in lieu of a and asserts that transac- such contract or out of arising “[s]eeking, accepting, continuing or em- the whole tion, perform the refusal to or you ployment agree AGF means thereof, or any part or employment related to resolve to an exist- submit arbitration writing to against company employee the or another controversy a arising out of such ing process this of through through instead refusal, contract, transaction, shall be or system.” Thus, the court 291.7 the J.A. irrevocable, enforceable, valid, save agreement, including provi- the arbitration exist at law or in grounds as upon such sion that continued would any contract. the revocation of equity for acceptance, written. constitute This is (2006). Seawright analogizes 2§ 9 U.S.C. in line with the conclusions of other cir- Frauds; FAA the Statute of howev- the to Caley Corp., cuits. v. Aero. Gulfstream er, the contracts fall under unlike (11th Cir.2005), F.3d 1359 the Elev- Frauds, arbitration Statute of held enth Circuit that a similar arbitration written, need but not the FAA to be under requirement satisfied the of be- Fisher, necessarily signed.5 276 ing “Although employees’ written: the ac- The agreement 895. at issue F.Supp.2d at by ceptance continuing employ- their pamphlet written.6 A entitled here was writing, ment and was not in all material Company’s Finance General including “American the manner of accep- terms — Dispute Program,” Resolution tance —were set forth in the written Employee [Dis- Authority rights.” (Appellee’s a 5. from number of other circuits not waive Br. 21- See, Genesco, e.g., 22). view. Inc. v. supports particular But those facts are irrelevant (2nd & 815 F.2d T. Kakiuchi to the of whether a determination contract is Cir.1987) (“[W]hile requires a writ [FAA] written. require writing ing, be it does not that the parties.”); Refining, signed Valero Inc. 7.The court Lee found that similar materi- Lauberhorn, Cir. v. F.2d M/T als did not constitute a written arbitration 1987) ("We note also that section three of agreement, stating: "An is man- require party a charter be Act does not part of mutual ifestation assent on of two signed an arbitration in order enforce (Second) persons. or more Restatement it.”); v. contained within Tinder (1981). Contracts Lee's assent to arbi- Sec., (7th Cir. 305 F.3d Pinkerton handbook, trate is not manifested in the DRP 2002) ("Although § requires 3 of the FAA video, poster, pamphlet, information sheet or written, to be does Lee, employee Red Lobster's booklet.” signed.”); them to Medical require not be Fed.Appx. reasoning at 162. This conflates Corp. Molding Development Industrial meanings "agree- two distinct of the word 1973) Cir. Corp., 479 F.2d at 348 requirements ment” and misunderstands ("It necessary simple that there be a [is] of the FAA. The uses the Restatement term writing sign integrated that a clause.”); "agreement” legal containing refer to set obli- writing the arbitration Corp., gations. "agreement” phrase Caley v. Aero. 428 F.3d The term in the Gulfstream (11th Cir.2005) ("We however, readily con agreement,” “written refers to an signature satisfy needed to clude that no physical actual document—the embodiment agreement requirement.”). FAA’swritten underlying legal obligations. Parties may agreement, assent to thus written form- Seawright attempts distinguish agree- legal ing obligations, putting without a set ment in Fisher on that the basis writing. the assent itself in “non-binding there ment at issue involved a policy did which the ' (“DRP”) pute Program complainants.” Resolution The would-be ]. Green Tree Financial Corp DRP it stated contract and Randolph, 531 .—A l abama agreement constituted the entire between 79, 89-90, 513, U.S. 121 S.Ct. 148 L.Ed.2d and (2000) (citations the Gulfstream as to cov- omitted). Even Ibid.; ered claims.” see also Medical De- “arising under a designed statute velopment Corp. v. Industrial Molding important further policies” social may be (10th Cir.1973) 345, Corp., 479 F.2d provided arbitrated prospective “the (“It necessary not [is] there be a litigant effectively may [his vindicate or simple integrated writing or that party statutory cause her] of action in the arbi sign writing containing the arbitration 90, tral forum.” Id. at 121 S.Ct. 513. clause”). employer The at try issue here did not mandatory hide its policy or IV try to trick employees its into agreeing to It eighty years has been over policy. employer Nor did the choose FAA originally since the enacted.8 Its an arbitration forum that would discourage purpose was to the longstanding reverse employees from’submitting disputes fa- judicial hostility agree towards arbitration employer vor the in the resolution of those place ments and to agreements disputes. In the absence of evidence that upon footing the same as other contracts. assent to the arbitration agreement was Gilmer, 21, U.S. S.Ct. 1647 procured though unfair means or that the (citing Dean Reynolds Byrd, Witter Inc. v. unfair, itself was substantively 213, 4, 1238, n. U.S. 219-20 105 S.Ct. courts mandatory should enforce arbitra- (1985) 84 L.Ed.2d 158 and Scherk v. Alber on the any same basis as 506, 4, to-Culver 510 n. other that employers require as (1974)). 2449, 41 S.Ct. L.Ed.2d 270 Con employment. condition of Seawright has gress policy has asserted a national favor failed to demonstrate grounds state ing arbitration and the Supreme Court has upon which the agreement might be void “by found that agreeing to arbitrate a or unenforceable and has failed to demon- claim, statutory a party forgo does not strate the did not comply with statute; rights by substantive afforded requirement the “written” of the FAA. We only it submits to their resolution in an therefore REVERSE the district court’s arbitral, judicial, rather than forum.” Gil decision denying compel the order to arbi- mer, U.S. S.Ct. 1647. While tration and REMAND to the district court unjust it is to bind a proceedings further consistent with the absence of assent or to enforce a con opinion. unconscionable, tract that betrays hostility unfounded towards arbitration MARTIN, JR., BOYCE F. Circuit

when actively courts seek to void substan Judge, dissenting. tively reasonable procured today The ruling goes Court’s too far in through procedure. fair Supreme The “rejected subordinating rights Court the constitutional generalized has attacks employees suspicion employ- arbitration that rest on to the convenience of arbi tration as a weakening pro “agreement” method of ers. The between Seawright tections afforded the substantive law to and AGF—which was signed, con- originally 8. The FAA was enacted in 1947 as Title 9 of the United States Code. Stat. and then reenacted and codified in impose any duty to inaction or on him working-as-acceptance a unilateral tained (Second) waiver of constituted a total (citing Id. Restatement provision, speak.” goes past (1981)). to access a right After cmt. a of Contracts court — can employers limit of what acceptable however, employee apparently today, without employees their upon force reject expressly must consent. employees’ order not to be bound it. foremost, signa- First majority also cites Fisher v. GE any arbitration appears ture nowhere on 891, Sys., 276 F.Supp.2d Med. proof Thus no that we have agreement. (M.D.Tenn.2003) Byrd and v. CIGNA Al- assent to the contract. manifested she *2-3, Healthcare, 32059026, WL unilat- permit though Tennessee law does 26902, *7 Dist. LEXIS contracts, no has de- Tennessee court eral (E.D.Tenn.2002) for that proposition is continuing employment cided whether employee an continuing binds constitutional as a waiver of effective employment-related claims. to arbitrate is one where rights. A unilateral contract Fisher, however, is inapposite because to induce “reasonably expects an offeror agreement at issue there was charac- action of a definite and substantial case, Indeed, non-binding. in that even Candy Curtiss ter” from offeree. See precedent cited the court involved (6th Silberman, 451, 453 Co. v. 45 F.2d employment agreements signed that were Cir.1930). Implicit understanding in this too, Byrd and then acted under. is differ- signifi- the offeree aware of the is that is Seawright’s Byrd signed from ent case. performed. act cance of the Without that employee for handbook receipt that a contract signal that understands stated, policy “I have contained the that made, if she being how one to know infor- reviewed the material which includes truly accepted? has policies, and services programs mation majority cites failure to The employees companies.” of the CIGNA lack of express her assent as evidence added). Here, (emphasis Id. at *3 Sea- her from the (distinguishing she assented only signature on an “Infor- wright’s Lee, she did plaintiff in who told her boss Sheet,” Sign-In in which “I mation Session to Lee v. Red agree program). not See acknowledge that I the in- have attended Inc., Am., Fed.Appx. Inns

Lobster copy formation session and received (6th Cir.2004). in that As we held Employee Dispute the AGF Resolution case, however, require it is too onerous to pamphlet.” App’x (emphasis Joint object to employees to new added). script information for the upon “a contract such as imposed them: says that sign-in session sheet “con- places this the burden on the to you information firms attended the object company’s to a unilater repeatedly session,” employees not that read or ally adopted policy or risk be policy’s binding understood the nature. agreed have it. ing found to to This is signature Id. at 315. Without a on a docu- contracts are Id. “The mere how formed.” proves at least does not ment receipt of unsolicited offer action or nature impair agreement, the offeree’s freedom of aware of the it is Simpson talking offering you God: “Here's want 1. Homer cookies and milk. If is, you everything I you, please give the deal: freeze as it and me to eat them for me no OK, anything sign, response] Thy won't ask for more. If that is will be done.” The [no (Fox please give sign, Maggie absolutely Simpsons: me re- And tele- [no no Makes Three broadcast, OK, 22, 1995). sponse] present you gratitude, deal. In I vision Jan. impossible say she knowingly waived ROBERT, Ivan Nicholas rights.

her Petitioner- Appellant, Ryan’s Family Walker v. Steak v. Houses, Cir.2005), 400 F.3d 370 we reiterated that employees cannot not Gayle TESSON, Respondent- M. compelled be to arbitrate their claims if Appellee. they not knowingly voluntarily did No. 06-3889. right

waive their constitutional to a jury trial. See also City Morrison Circuit United States Appeals, Court of Stores, Inc., 317 F.3d Cir. Sixth Circuit. 2003) (en bane) (adopting knowing Argued: Oct. 2007.

voluntary standard for to arbi Decided and Filed: Nov. trate in lieu of litigation). According to Morrison, plaintiff evaluate whether a knowingly voluntarily

has waived his right pursue employment her court,

in federal a court must evaluate a factors,

number of including employ- education, experience, background,

ee’s

and amount of time she had to consider agreement. Id. (quoting Adams v. Morris, Inc.,

Philip 67 F.3d

Cir.1995)). majority is correct educated, capable is an employ

ee capacity with the to understand con

tract terms. The Morrison factors as

sume, however, that an employee is aware

that she is entering agreement. into a new

Because performed any never signaled

action that knowingly voluntarily entered into the

(and waived rights), her it is unreasonable agreement’s

to hold her to the terms. Thus respectfully

I majori- DISSENT from the

ty’s opinion.

Case Details

Case Name: Seawright v. American General Financial Services, Inc.

Court Name: Court of Appeals for the Sixth Circuit

Date Published: Nov 13, 2007

Citation: 507 F.3d 967

Docket Number: 07-5091

Court Abbreviation: 6th Cir.