E.E.O.C. v. Luce, Forward, Hamilton & Scripps

Decision Date30 September 2003
Docket NumberNo. 01-55321.,No. 00-57222.,00-57222.,01-55321.
Citation345 F.3d 742
PartiesEqual Employment Opportunity Commission, Plaintiff-Appellee, v. Luce, Forward, Hamilton & Scripps, Defendant-Appellant. Equal Employment Opportunity Commission, Plaintiff-Appellant, v. Luce, Forward, Hamilton & Scripps, Defendant-Appellee.
CourtU.S. Court of Appeals — Ninth Circuit

Charles A. Bird, Kelly Capen Douglas, Luce, Forward, Hamilton & Scripps LLP, San Diego, California, for the defendant-appellant-appellee.

Dori Bernstein, EEOC, Washington, DC, for the plaintiff-appellee-appellant.

Cliff Palefsky, McGuinn, Hillsman & Palefsky, San Francisco, California, for intervenor Donald Lagatree, and for amici curiae National Employment Lawyers Association and American Association of Retired Persons.

Robert F. Walker, Paul Hastings Janofsky & Walker LLP, Los Angeles, California, for amicus curiae The Employers Group.

David S. Schwartz, University of Wisconsin Law School, Madison, Wisconsin, and John M. True, Leonard Carder, LLP, Oakland, California, for amici curiae George Miller, Barney Frank, Dennis J. Kucinich, John Conyers, Jr., Robert E. Andrews, William D. Delahunt, Harold E. Ford, Jr., Ron Kind, Edward J. Markey, Major R. Owens, Donald M. Payne, Hilda L. Solis, John F. Tierney, and Lynn L. Woolsey, Members of the United States House of Representatives.

Ann Elizabeth Reesman, McGuiness Norris & Williams, LLP, Washington, DC, for amici curiae Equal Employment Advisory Council and LPA, Inc.

Appeals from the United States District Court for the Central District of California; Florence Marie Cooper, District Judge, Presiding. D.C. No. CV 00-01322 FMC.

Before: Mary M. Schroeder, Chief Judge, Harry Pregerson, Stephen Reinhardt, Pamela Ann Rymer, A. Wallace Tashima, Barry G. Silverman, Susan P. Graber, M. Margaret McKeown, William A. Fletcher, Richard C. Tallman, and Richard R. Clifton, Circuit Judges.

Opinion by Judge Tashima; Partial Concurrence and Partial Dissent by Judge Pregerson; Dissent by Judge Reinhardt.


TASHIMA, Circuit Judge.

Donald Scott Lagatree was refused employment as a legal secretary by Luce, Forward, Hamilton & Scripps LLP ("Luce Forward") because he refused to sign an agreement to arbitrate all claims arising from his employment. Lagatree unsuccessfully sued Luce Forward in California state court. On Lagatree's behalf, however, the Equal Employment Opportunity Commission ("EEOC") brought this action against Luce Forward for retaliation in violation of Title VII of the Civil Rights Act of 1964 ("Title VII"), 42 U.S.C. § 2000e-3, the Americans with Disabilities Act of 1990 ("ADA"), 42 U.S.C. § 12203(a), the Age Discrimination in Employment Act of 1967 ("ADEA"), 29 U.S.C. § 623(d), and the Equal Pay Act of 1963 ("EPA"), 29 U.S.C. § 215(a). The EEOC sought make-whole relief, lost wages and benefits, as well as emotional distress and punitive damages for Lagatree. The EEOC also sought a permanent injunction forbidding Luce Forward from (1) requiring that employees sign arbitration agreements as a condition of employment, and (2) engaging in unlawful retaliation.

The district court refused, on res judicata grounds, to award make-whole relief and rejected the EEOC's request for injunctive relief under the ADA, the ADEA, and the EPA. Relying on our decision in Duffield v. Robertson Stephens & Co., 144 F.3d 1182 (9th Cir.1998), however, the district court enjoined Luce Forward from requiring applicants to agree to arbitrate Title VII claims and from enforcing existing agreements to arbitrate those claims. EEOC v. Luce, Forward, Hamilton & Scripps, LLP, 122 F.Supp.2d 1080 (C.D.Cal.2000) ("Luce Forward I"). Luce Forward appealed and the EEOC cross-appealed.

A three-judge panel reversed the district court's grant of injunctive relief, holding that "employers may require employees to sign agreements to arbitrate Title VII claims as a condition of their employment." EEOC v. Luce, Forward, Hamilton, & Scripps, 303 F.3d 994, 997 (9th Cir.2002) ("Luce Forward II"). The panel concluded that the Supreme Court's decision in Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001), implicitly overruled our decision in Duffield. Luce Forward II, 303 F.3d at 997. Concluding that Lagatree had not engaged in protected activity in refusing to sign the agreement, the panel also rejected the EEOC's argument that Luce Forward's refusal to hire Lagatree because of his refusal to sign the agreement constituted illegal retaliation. Id.

Because of the importance of the issue, we agreed to rehear this case en banc. EEOC v. Luce, Forward & Hamilton, & Scripps, 319 F.3d 1091 (9th Cir. 2003). While we disagree with Luce Forward II's conclusion that Circuit City implicitly overruled Duffield, we need not explore that disagreement in detail.1 It suffices to note that the panel opinion has been withdrawn. Id. We now conclude that, although Circuit City did not overrule Duffield, Duffield was wrongly decided; we therefore overrule it ourselves.


Lagatree was presented with Luce Forward's standard offer letter on his first day of work. The offer letter included an arbitration provision requiring Lagatree to submit all "claims arising from or related to [his] employment" to binding arbitration. It provided:

In the event of any dispute or claim between you and the firm (including employees, partners, agents, successors and assigns), including but not limited to claims arising from or related to your employment or the termination of your employment, we jointly agree to submit all such disputes or claims to confidential binding arbitration, under the Federal Arbitration Act. Any arbitration must be initiated within 180 days after the dispute or claim first arose, and will be heard before a retired State or Federal judge in the county containing the firm office in which you were last employed. The law of the State in which you last worked will apply.

Lagatree objected to the arbitration provision, explaining that he "couldn't sign... the arbitration agreement" because "it was unfair." In his deposition, Lagatree testified that he believed he needed to retain his "civil liberties, including the right to a jury trial and redress of grievances through the government process."

Luce Forward told Lagatree that the arbitration agreement was a non-negotiable condition of employment. When Lagatree still refused to sign the agreement, Luce Forward withdrew its job offer. It is undisputed that Luce Forward refused to hire Lagatree only because he would not sign the arbitration provision.2

Lagatree sued Luce Forward in state court, alleging wrongful termination in violation of public policy and in violation of the California Unfair Competition Law. Cal. Bus. & Prof.Code §§ 17200-17209; Cal. Civ.Code § 1668. Lagatree sought lost wages, damages for emotional distress, and punitive damages. The state court sustained Luce Forward's demurrer to the complaint, holding that Luce Forward did not unlawfully discharge Lagatree when he refused to sign a predispute arbitration agreement as a condition of employment. The California Court of Appeal affirmed, and the California Supreme Court denied review. Lagatree v. Luce, Forward, Hamilton & Scripps LLP, 74 Cal.App.4th 1105, 88 Cal.Rptr.2d 664 (1999), review denied, 2000 Cal. LEXIS 262, at *1 (Cal.2000).

While his state court suit was pending, Lagatree filed a discrimination charge with the EEOC, alleging that he was wrongfully terminated in retaliation for refusing to sign the Luce Forward arbitration provision. The EEOC sued Luce Forward on behalf of Lagatree and in the public interest, arguing that (1) Duffield prohibited Luce Forward from requiring Lagatree to sign an arbitration agreement, and (2) by refusing to hire Lagatree, Luce Forward unlawfully retaliated against him for asserting his constitutional right to a jury trial. The EEOC sought make-whole relief for Lagatree, including "rightful place employment," back wages and benefits, and compensatory and punitive damages. The EEOC also sought a permanent injunction enjoining Luce Forward from engaging in unlawful retaliation and ordering Luce Forward to "desist from utilizing mandatory arbitration agreements."

The district court denied monetary relief on res judicata grounds, finding that the state court judgment precluded the EEOC from obtaining monetary relief on Lagatree's behalf. Luce Forward I, 122 F.Supp.2d at 1086. The district court further ruled, however, that "[a]lthough the EEOC is in privity with Lagatree with respect to the claims for individual relief..., the same is not true for the EEOC's claims for injunctive relief pursuant to its duty to vindicate the public's interest in preventing employment discrimination." Id. at 1088. Observing that "Duffield is the law of the Ninth Circuit," the district court permanently enjoined Luce Forward from:

1) requiring or requesting its employees to agree to arbitration of their Title VII claims as a condition of employment; and

2) attempting to enforce any such previously executed agreements to arbitrate Title VII claims.3

Id. at 1093.

The district court did not expressly rule on the EEOC's retaliation theory, apparently considering it to be a subset of the question of monetary relief.

Luce Forward timely appealed the district court's injunction. The EEOC cross-appealed, seeking to enjoin Luce Forward from engaging in an "unlawful retaliatory practice by denying employment to any applicant... who refuses to waive his right to participate in statutorily protected... proceedings."4


We review a grant of summary judgment de novo. See Clicks Billiards Inc. v. Sixshooters, Inc., 251 F.3d 1252, 1257 (9th Cir.2001). We must determine, viewing the evidence in the light most favorable to the nonmoving party, whether there are any genuine issues of material fact and...

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