Campbell v. General Dynamics (1st Cir.) Amicus brief Dec. 2, 2004 IN THE UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT _____________ No. 04-1828 _____________ RODERICK CAMPBELL, Plaintiff-Appellee, v. GENERAL DYNAMICS GOVERNMENT SYSTEMS CORPORATION and RICHARD T. SCHNORBUS, Defendants-Appellants. _________________________________________________ On Appeal from the United States District Court for the District of Massachusetts _________________________________________________ BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS AMICUS CURIAE SUPPORTING AFFIRMANCE _________________________________________________ ERIC S. DREIBAND General Counsel LORRAINE C. DAVIS Acting Associate General Counsel VINCENT J. BLACKWOOD Assistant General Counsel ELIZABETH E. THERAN Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street N.W., Room 7012 Washington, D.C. 20507 (202) 663-4720 TABLE OF CONTENTS TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . .iii STATEMENT OF INTEREST. . . . . . . . . . . . . . . . . . . . . .1 STATEMENT OF THE ISSUE . . . . . . . . . . . . . . . . . . . . .2 STATEMENT OF THE CASE. . . . . . . . . . . . . . . . . . . . . .2 ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 IT IS NOT APPROPRIATE UNDER THE AMERICANS WITH DISABILITIES ACT TO ENFORCE AN EMPLOYER'S MANDATORY ARBITRATION POLICY, THEREBY DEPRIVING AN EMPLOYEE OF ACCESS TO FEDERAL COURT FOR RESOLUTION OF FEDERAL CIVIL RIGHTS CLAIMS, WHERE THE EMPLOYER FAILED TO PROVIDE ITS EMPLOYEES WITH MEANINGFUL NOTICE OF THAT POLICY.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . 14 CERTIFICATE OF COMPLIANCE. . . . . . . . . . . . . . . . . . . 16 CERTIFICATE OF SERVICE . . . . . . . . . . . . . . . . . . . . 17 TABLE OF AUTHORITIES CASES Bercovitch v. Baldwin Sch., Inc., 133 F.3d 141 (1st Cir. 1998) .9 Circuit City Stores v. Adams, 532 U.S. 105 (2001). . . . . . . .6 Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52 (1995).8 Ramirez de Arellano v. American Airlines, Inc., 133 F.3d 89 (1st Cir. 1997)6 Rosenberg v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 170 F.3d 1 (1st Cir. 1999) . . . . . . . . . . . . . . . . passim Wright v. Universal Maritime Serv. Corp., 525 U.S. 707 (1998). .7 STATUTES Americans with Disabilities Act of 1990, 42 U.S.C. 12101 et seq.1 Americans with Disabilities Act of 1990, 101(4), 42 U.S.C. 12111(4)11 Americans with Disabilities Act of 1990, 102, 42 U.S.C. 1211211 Americans with Disabilities Act of 1990, 513, 42 U.S.C. 122126, 8, 11 Civil Rights Act of 1991, Pub. L. No. 102-166, 105 Stat. 1071, 109 (codified as amended in scattered sections of 42 U.S.C.). . . . . . . . . . 11 Civil Rights Act of 1991, Pub. L. No. 102-166, 105 Stat. 1071, 118 (codified as amended at 42 U.S.C. 1981 note). . . . . . . . . . . . . passim Fed. R. App. P. 29(a). . . . . . . . . . . . . . . . . . . . . .2 IN THE UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT ____________ No. 04-1828 ____________ RODERICK CAMPBELL, Plaintiff-Appellee, v. GENERAL DYNAMICS GOVERNMENT SYSTEMS CORPORATION and RICHARD T. SCHNORBUS, Defendants-Appellants. _________________________________________________ On Appeal from the United States District Court for the District of Massachusetts _________________________________________________ BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS AMICUS CURIAE SUPPORTING AFFIRMANCE _________________________________________________ STATEMENT OF INTEREST The Equal Employment Opportunity Commission is the agency established by Congress to administer, interpret, and enforce the Americans with Disabilities Act of 1990, 42 U.S.C. 12101 et seq., and other federal antidiscrimination statutes. This case presents the question of whether it is appropriate under the ADA for a court to enforce an employer's arbitration policy, thereby barring an employee's access to federal court, when the employer failed to give the employee meaningful notice that it was imposing a policy of mandatory arbitration of employment disputes. For the reasons discussed below, the Commission agrees with the district court that it is inappropriate to deprive a plaintiff of procedural rights granted by Congress on the basis of a policy that was not adequately communicated to him particularly where, as here, the employer easily could have provided effective notice, but chose not to. Accordingly, pursuant to Fed. R. App. P. 29(a), we offer our views to the Court as amicus curiae. STATEMENT OF THE ISSUE Whether the district court correctly ruled that the defendant's arbitration policy should not be enforced with respect to the plaintiff's claim under the Americans with Disabilities Act because the defendant failed to provide the plaintiff with meaningful notice that he was waiving his statutory right to a judicial forum for disability discrimination when it promulgated the policy. STATEMENT OF THE CASE 1. Statement of Facts Roderick Campbell worked for General Dynamics Government Systems as an engineer for almost three years, until his employment was terminated in December of 2002. Appendix ("A") 29. Campbell alleges that General Dynamics fired him because of a disability, sleep apnea. A-8 11. In September 2003, Campbell filed suit against General Dynamics in Massachusetts state court alleging disability discrimination under state and federal law. Id. General Dynamics removed the case to federal court and, shortly thereafter, moved to compel arbitration of Campbell's claims pursuant to the company's Dispute Resolution Policy ("DRP"), implemented in May 2001. A-32, 45. General Dynamics notified its employees that it was implementing the DRP in an e-mail dated April 30, 2001. A-63 64. The text of the e-mail was a one-page letter from Gerard J. DeMuro, the president of General Dynamics Communication Systems. Id. The first two paragraphs of the letter spoke in general terms about the company's success in a competitive marketplace and its commitment to "open, forthright and honest" communication with its employees. Id. The third paragraph stated that the company developed the DRP as a way of resolving workplace disputes, "strengthening open communication," and "enabl[ing] employees to express more freely and effectively their concerns and seek resolutions of workplace problems." Id. The fourth and last paragraph stated that the DRP would be implemented effective May 1, 2001, and asked recipients to "[p]lease review the enclosed materials carefully, as the DRP is an essential element of your employment relationship." Id. Nowhere did the text of the e-mail state that use of the DRP was mandatory or that it would affect employees' rights under federal law, including their access to the federal courts as a forum for dispute resolution. At the bottom of the e-mail were links to two documents stored on General Dynamics' internal web site: the company's DRP handbook, and a two-page flyer that set out the terms of the DRP in a question-and-answer format. A-64. The lower right- hand corner of the second page of the flyer contained a highlighted box of text stating: The Company has adopted this four-step policy as the exclusive means of resolving workplace disputes for legally protected rights. If an employee files a lawsuit against the Company, the Company will ask the court to dismiss the lawsuit and refer it to the Dispute Resolution Policy. A-66. This paragraph was not visible to the employee unless and until he opened the link and scrolled to the end of the document. In his opposition to the defendant's motion to compel arbitration, Campbell argued that he was not bound by the DRP because he did not receive sufficient notice of its terms to be deemed to have assented to it. He stated in an affidavit that he had no memory of ever receiving the e-mail or seeing a copy of the DRP. A-161. In response, General Dynamics presented an e-mail "tracking log" from its computer system, which indicated that Campbell had opened the e-mail at 1:56 p.m. on April 30, 2001, two minutes after the e-mail was sent. A-62, 94. However, because the company did not track whether an employee clicked on the links attached to the e-mail, there was no evidence that Campbell had ever accessed or read the handbook or the flyer. A-62. Campbell explained that he received anywhere from 10 to 100 work- related e-mail messages per day, some of which were internal mass-mailings related to company functions and employees' birthdays, many of which he merely skimmed. A- 161. He also related that, during his employment at General Dynamics, all of his communications with the company relating to his employment were handled by Human Resources, and "anything affecting me or my employment was done by a writing, which I was required to sign and which I understood became part of my personnel file." A-209. 2. District Court Decision The district court denied the defendant's motion to compel arbitration. The court observed: General Dynamics did nothing but send the email to make its employees aware of the DRP. Plainly, even email technology enables the company to do better. The company did not, for example, require an employee to signify by return email that he had read the email, or more importantly, that he had read the attachments and understood their implications. General Dynamics did not require the employee to note "I accept" in a return email. A-216. According to the court, "[i]n these days, when employees may be deluged with electronic messages and readily delete them, the question is whether a company can notify its employees of a substantial change in policy as General Dynamics did here." Id. The district court observed that the Supreme Court has held "that agreements to arbitrate statutory discrimination claims are enforceable." A-217 (citing Circuit City Stores v. Adams, 532 U.S. 105, 123-24 (2001)). The court also noted that section 513 of the ADA, 42 U.S.C. 12212, "expressly encourages" arbitration of disputes "[w]here appropriate and to the extent authorized by law." A-218. Furthermore, the court stated, "employment discrimination claims based on disability were specifically included in the handbook (4.1) and the flyer (page 2)." Id. Therefore, according to the district court, "the key question here is [] whether, under general principles of state contract law and under the language of the ADA, the level of notice was sufficient to find that there was an agreement which encompassed those terms." Id. The district court went on to note that, in this Circuit, "a waiver of the right to a judicial forum for civil rights claims in exchange for continued employment 'must at least be express.'" A-219 20 (citing Ramirez de Arellano v. American Airlines, Inc., 133 F.3d 89, 91 n.2 (1st Cir. 1997)). Thus, the court concluded, "[u]nder even the loosest standards suggested by courts, an employee does not give up his statutory right to a judicial forum unless he knew he was doing so or the notice he received was sufficient to bind him despite his lack of actual knowledge (such as in the case of a party who signed an agreement without bothering to read its contents)." A-220 (citing Rosenberg v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 170 F.3d 1, 19, 21 (1st Cir. 1999), and Wright v. Universal Maritime Serv. Corp., 525 U.S. 70, 80 (1998)). The district court observed that, in considering whether the arbitration clause in Rosenberg was enforceable, this Court "focused on 'Congress's concern that agreements to arbitrate employment discrimination claims should be enforced only where "appropriate," a concern not expressed in the FAA or at common law.'" A-221 (quoting Rosenberg, 170 F.3d at 19). According to the district court, "[t]he ADA's 'appropriate' language raises the bar for enforceability," so that notice sufficient to create a binding agreement under state contract law or the FAA may not suffice under the ADA. Id. & n.3. The court noted that the Rosenberg Court held that enforcement of the arbitration clause at issue in that case was "inappropriate," despite the fact that the plaintiff had signed an acknowledgment form that explicitly referenced mandatory arbitration of disputes with her employer, because the employer "had the opportunity to make the contract sufficiently specific to put [the plaintiff] on notice [that the agreement applied to discrimination claims], but it failed to do so . . . ." A-222. Applying Rosenberg to this case, the district court held that enforcement of the DRP was inappropriate under section 513 of the ADA because General Dynamics' method of notifying Campbell of the DRP was not sufficient to put him on notice that he was waiving his statutory rights. The court stated: General Dynamics seemed to have done as little as it could to ensure their employees were informed of a program that substantially affected their employee's legal rights. Although they hired Campbell in writing and terminated him both in person and in writing, they chose to send notice of the implementation of the DRP solely by email. They sent no paper letters, and held no meetings to announce the DRP verbally. They did not ask employees to sign anything even electronically signifying they read and understood the DRP. They did not even take the incredibly simple and inexpensive step of configuring their system to log when and if employees clicked on the links to the flyer or the handbook. A-223. According to the court, "to presume that Campbell read the text of the email, clicked on its links, and read the linked documents, and use that as the basis for depriving him of rights guaranteed to him by federal law, would be to show an intolerably low level of respect for those rights." A-224. The court held that General Dynamics should bear the risk of its employees' ignorance of the DRP because it could have easily and cheaply provided adequate notice, but failed to do so. A-225 26 (citing Rosenberg, 170 F.3d at 19, and Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52, 62 (1995)). The district court also held that, "even applying basic Massachusetts contract law," the DRP could not be enforced against Campbell because Campbell, the offeree, did not have sufficient notice of the offer in order to be deemed to have accepted it. A-221 n.3. While the court agreed with General Dynamics that an arbitration agreement need not be signed by the employee in order to be enforceable, the court held that actual notice to the employee is required, and that General Dynamics had failed to provide such notice in its mass e-mail. Id. ARGUMENT IT IS NOT APPROPRIATE UNDER THE AMERICANS WITH DISABILITIES ACT TO ENFORCE AN EMPLOYER'S MANDATORY ARBITRATION POLICY, THEREBY DEPRIVING AN EMPLOYEE OF ACCESS TO FEDERAL COURT FOR RESOLUTION OF FEDERAL CIVIL RIGHTS CLAIMS, WHEN THE EMPLOYER FAILED TO PROVIDE ITS EMPLOYEES WITH MEANINGFUL NOTICE OF THAT POLICY. This Court observed in Rosenberg that a plaintiff may be compelled to arbitrate ADA claims in cases where he has "voluntarily signed an agreement requiring arbitration." Rosenberg, 170 F.3d at 9 (quoting Bercovitch v. Baldwin Sch., Inc., 133 F.3d 141, 143 (1st Cir. 1998)). However, the Rosenberg Court went on to explain, in light of the language in section 118 of the Civil Rights Act of 1991 providing that arbitration of Title VII claims is encouraged "[w]here appropriate and to the extent authorized by law," an arbitration agreement should not be enforced with respect to claims under that statute unless "there [is] some minimal level of notice to the employee that statutory claims are subject to arbitration." Id. at 21. The district court correctly concluded that this standard applies equally to the ADA claims at issue in this case, and that the notice provided to the plaintiff was inadequate to make enforcement of the DRP appropriate. In Rosenberg, this Court held that, by providing in the Civil Rights Act of 1991 that arbitration is encouraged only where it is both "appropriate" and "authorized by law," Congress indicated that at least some arbitration agreements that satisfy the standards of the FAA and state contract law should not be enforced with respect to employment discrimination claims. Id. at 20-21. Rosenberg's interpretation of section 118 is consistent with the canon of statutory interpretation that counsels against construing statutory language as meaningless surplusage. In drafting that provision, Congress chose to include both phrases: "appropriate" and "to the extent authorized by law." If it had intended the boundaries of "appropriateness" to be coextensive with those of the FAA and contract law, there would have been no reason to include the inherently discretionary term "appropriate." Applying this standard to the private arbitration agreement at issue, the Rosenberg Court held that it was not "appropriate" to enforce such an agreement with respect to claims under Title VII unless the employee had sufficient notice that her statutory claims were subject to mandatory arbitration. Accordingly, following Rosenberg, the district court in this case correctly held that it was inappropriate to enforce General Dynamics' DRP with respect to Campbell's ADA claims. First, section 118 of the Civil Rights Act of 1991, codified at 42 U.S.C. 1981 note, applies to ADA claims because it applies to all "disputes arising under the Acts or provisions amended" by that statute. Section 109 of the 1991 Civil Rights Act, Pub. L. No. 102- 166, 105 Stat. 1071, amends sections 101(4) and 102 of the ADA, 42 U.S.C. 12111(4), 12112; therefore, section 118 applies to the ADA. Moreover, as the Rosenberg panel noted, section 513 of the ADA contains "parallel language." Therefore, the district court correctly ruled that, under Rosenberg, the DRP should not be enforced unless General Dynamics provided Campbell with sufficient notice that his statutory claims were subject to mandatory arbitration. The district court was also correct in concluding that General Dynamics failed to provide sufficient notice to make enforcement of the DRP "appropriate." Indeed, the facts of this case are even more compelling than those of Rosenberg. In Rosenberg, the plaintiff was at least made aware that her employer had a mandatory arbitration policy in place. 170 F.3d at 19-20. Here, by contrast, General Dynamics' e-mail to its employees failed to give Campbell meaningful notice that it had a mandatory arbitration policy. Although the e-mail informed them that General Dynamics had instituted a new "Dispute Resolution Policy" that included arbitration as a means of resolving workplace disputes, nothing in the e-mail indicates that resort to that policy would be mandatory or that it would deprive employees of a judicial forum for claims arising under federal antidiscrimination laws. Contrary to the suggestion in the defendants' brief, the district court's decision is not inconsistent with the statement in Rosenberg that it would have been appropriate to enforce the arbitration policy in that case if Rosenberg had been provided with the rules regarding the arbitration policy but did not read them. Def. Br. at 22-23 (citing Rosenberg, 170 F.3d at 21 n.17). Rosenberg had signed an agreement providing that she must arbitrate "any dispute, claim or controversy" with her employer. Since she was clearly on notice that the employer's arbitration policy implicated important legal rights, the Court held that it would be appropriate to enforce the policy with respect to her claims if she were provided with the arbitration rules but failed to read them. By contrast, when General Dynamics provided its employees with a link to a file on its internal website that contained the rules for the DRP, the employees had been given no indication that the DRP was a program that altered their legal rights in a significant way. We disagree with the suggestion of the defendants and their amicus, the EEAC, that the district court held that e-mail can never be an adequate means of providing notice of a mandatory arbitration policy. See, e.g., EEAC Br. at 3, 8; Def. Br. at 19. On the contrary, the district court enumerated several ways in which the defendants readily and inexpensively could have rendered their e-mail notice adequate under federal law. A-216 (e.g., requiring employee to signify reading e-mail and/or attachments by return e-mail or to send a return e-mail noting "I accept"), 223 (e.g., asking employees to sign acknowledgment electronically or configuring system to log employees' accessing of links). Although the district court suggested that e-mail communications tend not to be as effective as written communications, we do not read the court's opinion to hold that an e-mail that clearly conveys to employees that an arbitration policy is mandatory and precludes resort to a judicial forum could not effectively bind employees. The point here is simply that because of the way the e-mail at issue was structured a vaguely worded e-mail that gave its recipients no indication of what was at stake, with two links at the end that had to be accessed separately it gave employees like Campbell no meaningful notice that the information contained in the linked documents bound them to mandatory arbitration. This is also not, as EEAC suggests in its brief, a case about whether arbitration of employment claims is beneficial to employees. EEAC Br. at 20-23. The district court's holding does not rest on the premise that arbitration is itself undesirable. Rather, the district court's position, the Commission's position, and the position adopted by this Court in Rosenberg is this: If an employer intends to change the terms and conditions of an individual's employment in a way that deprives that individual of access to federal court for vindication of civil rights claims, that employer must do so, at a minimum, in a manner that gives the individual meaningful notice of the change. The principle that an employee who continues to work for an employer after the employer adopts a mandatory arbitration policy has accepted the policy depends on the premise that the employee was given reasonable notice of the policy. Where, as here, an employer did not expend the minimal effort required to communicate that change, the employee cannot fairly be deemed to have "accepted" a change of which he was unaware. In this case, the defendants could easily have spelled out clearly in the e-mail that the DRP altered the terms and conditions of employment at the company and that it was mandatory. Instead, the company chose to send out a vaguely worded e-mail that gave employees no notice whatsoever of the mandatory nature of the DRP. The district court correctly ruled that it is not appropriate to enforce the policy under these circumstances. CONCLUSION For the foregoing reasons, the district court's denial of the defendants' motion to compel arbitration should be affirmed. Respectfully submitted, ERIC S. DREIBAND General Counsel LORRAINE C. DAVIS Acting Associate General Counsel VINCENT J. BLACKWOOD Assistant General Counsel ___________________________ Elizabeth E. Theran Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street N.W., Room 7012 Washington, D.C. 20507 (202) 663-4720 CERTIFICATE OF COMPLIANCE 1. This brief complies with the type-volume limitation of Fed. R. App. P. 32(a)(7)(B) because this brief contains 3234 words, excluding the parts of the brief exempted by Fed. R. App. P. 32(a)(7)(B)(iii). 2. This brief complies with the typeface requirements of Fed. R. App. P. 32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because it has been prepared in a proportionally spaced typeface using WordPerfect 9.0 in 14-point Times New Roman for both text and footnotes. ___________________________ Elizabeth E. Theran Dated: CERTIFICATE OF SERVICE I hereby certify that two copies of the foregoing brief and one copy of my completed appearance of counsel form were sent via Federal Express, postage prepaid, on December 2, 2004, to the following counsel of record: Counsel for Plaintiff: John Nelson Lewis Lawrence R. Mehl John N. Lewis & Associates 21 Merchants Row 5th Fl Boston, MA 02109 Counsel for Defendants: Arthur G. Telegen Claudia T. Centomini Foley Hoag LLP 155 Seaport Boulevard Boston, MA 02210-2600 Counsel for Amici Curiae: Ann Elizabeth Reesman McGuiness Norris & Williams 1015 15th Street, N.W. Suite 1200 Washington, D.C. 20005 Martin J. Newhouse Benjamin Robbins Andrew R. Grainger New England Legal Foundation 150 Lincoln St. Boston, MA 02111 _____________________ Elizabeth E. Theran Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 1801 L Street, N.W., Room 7012 Washington, D.C. 20507 (202) 663-4720 ___________________________________________ 1 The district court noted that, although the Rosenberg Court was referring to section 118 of the Civil Rights Act of 1991, the ADA has a provision using “parallel” language. A-219.