FILED
NOT FOR PUBLICATION JUL 03 2014
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
TAYLER BAYER, No. 11-17920
Plaintiff - Appellee, D.C. No. 3:11-cv-03705-MEJ
v.
MEMORANDUM*
NEIMAN MARCUS HOLDINGS, INC.,
Defendant - Appellant.
Appeal from the United States District Court
for the Northern District of California
Maria-Elena James, Magistrate Judge, Presiding
Argued and Submitted October 18, 2013
San Francisco, California
Before: THOMAS and McKEOWN, Circuit Judges, and KENDALL, District
Judge.**
Neiman Marcus Holdings, Inc. (“Neiman”) appeals from the district court’s
order denying its motion to compel arbitration. We affirm.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Virginia M. Kendall, District Judge for the U.S.
District Court for the Northern District of Illinois, sitting by designation.
I
Bayer commenced work with Neiman in 2006. He was diagnosed with
emphysema in 2007 and placed on medical leave. He was authorized by his
physician to return to work on June 1, 2007, subject to medical restrictions on his
work, including working no more than eight hour shifts, four days a week. Bayer
alleges that Neiman refused to accommodate this schedule, which resulted in his
loss of status as a full-time employee and concomitant benefits. He filed an
administrative complaint with the Equal Employment Opportunity Commission
(“EEOC”) on June 20, 2007.
On that same day, all Neiman employees were mailed notice of a dispute
resolution program, which included a mandatory arbitration agreement
(“Arbitration Agreement”). The mailing included an acknowledgment form
(“Acknowledgment Form”) that required the employee’s signature. The
Acknowledgment Form indicated that the employee was “waiving the right to a
trial by jury or trial before a judge in a court of law.” The Acknowledgment Form
also required the employee to express his or her understanding that the arbitration
provisions were “not optional,” but rather they were “mandatory, and a condition
and term of my employment if I am employed or continue employment on or after
July 15, 2007.”
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Bayer refused to sign the Acknowledgment Form. Instead, he filed a second
administrative complaint with the EEOC, alleging that Neiman had discriminated
against him in violation of his rights under the Americans with Disabilities Act, 42
U.S.C. § 12101, et. seq. (“A.D.A.”) by attempting to coerce him into signing the
Arbitration Agreement as a condition of continued employment.
After the EEOC issued a right to sue letter on his first administrative
complaint, Bayer filed a federal civil suit alleging disability discrimination under
the A.D.A. because of Neiman’s alleged refusal to accommodate his disability.
The parties settled that action, but they specifically excluded from the release any
claims Bayer might have with respect to challenging the validity or enforceability
of the Arbitration Agreement.
Bayer continued his employment throughout 2008. On at least four
occasions between July 2007 and September 2008, he refused to sign arbitration-
related forms. On at least four occasions, he told his supervisors that he was
refusing to agree to or be bound by the Arbitration Agreement. He delivered two
letters to Neiman explaining why he had refused to sign the Acknowledgment
Form and other arbitration-related forms, and why he was refusing to be a party to
the Arbitration Agreement.
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Neiman terminated him in January 2009. In response, Bayer filed a third
EEOC complaint, alleging he was terminated in retaliation for filing EEOC and
A.D.A. complaints. The EEOC issued a right to sue letter, and Bayer filed this
action, alleging discrimination and retaliation in violation of the A.D.A. Neiman
filed a motion to compel arbitration, which the district court denied. This
interlocutory appeal followed.
II
The primary question in this case is whether Bayer’s continued employment
with Neiman after he received the Arbitration Agreement and Acknowledgment
Form constituted implied consent to the Arbitration Agreement under California
law. When a federal court confronts a state law issue without binding precedent
from the state’s highest court, as is the case here, the court “must predict how the
highest state court would decide the issue using intermediate appellate court
decisions, decisions from other jurisdictions, statutes, treatises, and restatements as
guidance.” Sec. Pac. Nat’l Bank v. Kirkland (In re Kirkland), 915 F.2d 1236, 1239
(9th Cir. 1990).
Under California law, a contract is established when (1) the parties are
capable of contracting, (2) the parties consent to the contract, (3) the contract
describes a lawful object, and (4) there was sufficient cause or consideration
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supporting the contract. Cal. Civ. Code § 1550. Here, there is no dispute over the
first, third, and fourth elements. The only question is whether Bayer legally
consented to the Arbitration Agreement.
California’s intermediate appellate courts have recognized that employees’
consent may be implied from their continued employment after the unilateral
imposition of an arbitration agreement by the employer. See, e.g., Craig v. Brown
& Root, Inc., 84 Cal. App. 4th 416, 421–22 (2000). However, as the district court
properly noted, California courts have not found implied consent when the
employer has required the employee to sign or acknowledge an arbitration
agreement. Gorlach v. Sports Club Co., 209 Cal. App. 4th 1497, 1509–11 (2013);
Mitri v. Arnel Mgmt. Co., 157 Cal. App. 4th 1164, 1171 (2007); Romo v. Y-3
Holdings, Inc., 87 Cal. App. 4th 1153, 1159–60 (2001).
In Gorlach, the employees were presented with a new employee handbook
that contained a provision stating that, as a condition of employment, all employees
must sign an arbitration agreement. The plaintiff declined to sign and continued
working. 209 Cal. App. 4th at 1500. The court concluded that the continued
employment did not create an implied-in-fact arbitration agreement. Id. at
1507–10. The court distinguished Craig on the basis that the employees were
required to sign the agreement. Id. at 1508–09.
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Similarly, in Mitri, the employee handbook contained a unilateral arbitration
policy and stated that employees would be required to sign a separate arbitration
agreement. 157 Cal. App. 4th at 1167. None of the affected employees signed the
separate agreement; therefore, the court concluded the employees had not
consented, and therefore there was no effective agreement to arbitrate. Id. at 1173.
In Romo, the employee handbook contained general provisions and an arbitration
provision. 87 Cal. App. 4th at 1156. The plaintiff acknowledged the general
provisions but did not sign the arbitration provision. Therefore, the court
concluded there was no effective arbitration agreement. Id. at 1159–60.
Here, as part of its mailing to the employees, Neiman required the
employees to sign the Acknowledgment Form, which contained the waiver of
rights and an acknowledgment that continued employment would include
arbitration as a condition and term. Bayer not only refused to sign, he filed an
EEOC claim contending that the requirement constituted disability discrimination.
Over the course of his employment, he refused to sign four other arbitration-related
documents. He explained to his supervisors that he was refusing to be bound by
the Arbitration Agreement. He sent letters to Neiman explaining his refusal to be
governed by the Arbitration Agreement, and he filed another administrative action
before the EEOC raising the issue.
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Bayer’s actions stand in contrast to Craig, where the employee did not
refuse the new arbitration terms, explicitly reject them, or state any disagreement
with them. See 84 Cal. App. 4th at 19–20. Indeed, Bayer’s actions rejecting the
Arbitration Agreement were more pronounced than those involved in Gorlach,
Mitri, and Romo, where the primary rationale was that the plaintiffs had not signed
tendered documents.
Given this case law and the circumstances specific to Bayer’s case, as well
as appropriate drawing of all factual inferences in favor of the non-moving party,
the district court reasonably concluded that California courts would not hold that
Bayer’s continued employment constituted implied consent to the Arbitration
Agreement.1
III
1
Our recent decisions in Johnmohammadi v. Bloomingdale’s, Inc., __ F.3d
__, 2014 WL 2808135 (9th Cir. 2014), and Davis v. Nordstrom, Inc., __ F.3d __,
2014 WL 2808139 (9th Cir. 2014), do not affect this disposition because both are
factually distinguishable. In Bloomingdale’s, Johnmohammadi received the
arbitration agreement and opt-out form when she was first hired. 2014 WL
2808135, at *1. She did not opt out and did “not contest the district court’s
findings that she made a fully informed and voluntary decision . . . . By not opting
out within the 30–day period, she became bound by the terms of the arbitration
agreement.” Id. In Nordstrom, Davis received the arbitration agreement as a part
of the employee handbook and was thus bound by the agreement when she first
took her position. 2014 WL 2808139, at *2. Nordstrom later revised the
agreement, but Davis “never objected to the revised provision and she did not quit
her job.” Id. at *3.
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Neiman also argues that the question of arbitrability must be decided by the
arbitrator, not the court. However, the district court did not reach this question.
We therefore decline to address it in this interlocutory appeal.
AFFIRMED.
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