Posted October 3rd, 2018.
By Emma Cueto
Law360 (October 3, 2018, 1:53 PM EDT) — An attorney suing Ogletree Deakins Nash Smoak & Stewart PC for gender bias has argued that the $300 million proposed class action currently in California federal court doesn’t belong in arbitration, contending that the firm presented its arbitration agreement in a misleading way and that she never actually signed it.
Dawn Knepper, who has alleged that the management-side powerhouse’s male-dominated leadership disproportionately favors men over women in pay, promotions and business development opportunities, told the court Tuesday that employees could not be said to have waived the right to a trial simply by remaining silent, especially when an employer was not transparent about the arbitration agreement.
“As a matter of law, Ogletree’s misleading conduct is not sufficient to create a duty to speak in order to avoid entering a contract,” her opposition brief said. “As applied here, defendants’ argument seeks to transform the current state of the law from one that protects individuals against unknowing waivers of their rights, into one that actively incentivizes companies to secure such waiver.”
Knepper, an employment attorney who spent 12 years at Ogletree, filed suit in January. She left the firm for Buchalter PC a month later.
Her suit alleges that Ogletree has fostered a male-dominated culture in which male shareholders are “grossly over-represented” at the top tier of its management structure, and that they systematically discriminate against female nonequity shareholders in pay and promotions.
The firm then attempted to move the pay discrimination dispute from the Northern District of California to the central district, but that effort was stalled after Knepper requested to add three individual defendants, four named plaintiffs, and new breach of contract and breach of fiduciary duty claims in an amended complaint.
After the new complaint, the parties conducted limited discovery on the issue of the arbitration agreement and then resumed their dispute over whether the suit belongs in federal court or not. Ogletree argued that Knepper had multiple opportunities to opt out of the agreement, but never did.
Knepper, however, stressed in her opposition Tuesday that she had also never signed the arbitration agreement, arguing that it could therefore not apply to her. A signature is not just “an empty gesture,” Knepper said, and the language of the Ogletree arbitration agreement itself clearly anticipated a signature.
Moreover, she said, Ogletree had not made acceptance of the agreement a mandatory part of working at the firm, or done any of the other things that might allow it to claim employees were subject to the agreement whether they signed or not.
Rather than being open and ensuring that employees fully understood the agreement, as was the case in other situations where parties were subject without signing, Ogletree had tried to obscure the agreement’s purpose in its original email, Knepper said.
Knepper also argued that saying an employee could be subject to an arbitration agreement that they had not clearly consented to was a “dangerous and dramatic extension of the current line of case law.”
“The requirements of actual knowledge and informed consent — and the burden on employers to ensure that these requirements are met — are not mere formalities, but rather are intended to safeguard against an unknowing forfeiture of statutory and constitutional rights,” the opposition said. “Ogletree’s argument entirely misses this critical point.”
Leigh Anne St. Charles, an attorney for Knepper, told Law360, “Our position is and has been that there is no valid arbitration agreement. … It is an elemental premise of contract law that both parties have to know they are entering a contract.”
She added that Ogletree’s process for presenting the arbitration agreement, including introducing it in an email with the subject line “Two New Programs for 2016,” was “fundamentally insufficient” to establish a contract.
Counsel for Ogletree did not immediately respond to a request for comment.
Knepper is represented by Leigh Anne St. Charles, David Sanford, Jill Sanford, Edward Chapin and Jeremy Heisler of Sanford Heisler Sharp LLP.
Ogletree is represented by Nancy L. Abell, Deborah S. Weiser, Valerie M. Marek and Paul W. Cane Jr. of Paul Hastings LLP.
The case is Knepper v. Ogletree Deakins Nash Smoak & Stewart PC, case number 3:18-cv-00303, in the U.S. District Court for the Northern District of California.
–Additional reporting by Sam Reisman, Cara Bayles, Dorothy Atkins, Ryan Boysen and Vin Gurrieri. Editing by Emily Kokoll.