Johnson v. Circuit City Stores
| Decision Date | 01 July 1998 |
| Docket Number | No. 97-2408,97-2408 |
| Citation | 148 F.3d 373 |
| Parties | 77 Fair Empl.Prac.Cas. (BNA) 139, 73 Empl. Prac. Dec. P 45,399 Demeka JOHNSON, Plaintiff-Appellee, and Eric Brooks; Reginald Derrickson; Mohmed Ibrahim; Maxine James; Artis Kendall; Bernard Livingston; Harold Moore; Stanley Sims; Steven Taylor; H. Alexander Richardson, Plaintiffs, v. CIRCUIT CITY STORES, Incorporated, Defendant-Appellant. Equal Employment Opportunity Commission, Amicus Curiae. |
| Court | U.S. Court of Appeals — Fourth Circuit |
ARGUED: Rex Darrell Berry, Davis, Grimm & Payne, Seattle, Washington, for Appellant. Terry Lynn Sullivan, Howrey & Simon, Washington, DC, for Appellee. Jodi Beth Danis, Office of General Counsel, Equal Employment Opportunity Commission, Washington, DC, for Amicus Curiae. ON BRIEF: David E. Nagle, Leclair Ryan, Richmond, Virginia, for Appellant. William R. O'Brien, Patricia G. Butler, Howrey & Simon, Washington, DC; Warren Kaplan, The Washington Lawyers' Committee For Civil Rights and Urban Affairs, Washington, DC, for Appellee. C. Gregory Stewart, General Counsel, Philip B. Sklover, Associate General Counsel, Vincent J. Blackwood, Assistant General Counsel, Equal Employment Opportunity Commission, Washington, DC, for Amicus Curiae.
Before WIDENER, HAMILTON, and MICHAEL, Circuit Judges.
Vacated and remanded by published opinion. Judge HAMILTON wrote the opinion, in which Judge WIDENER and Judge MICHAEL joined.
Acting pursuant to 28 U.S.C. § 1292(b) and upon the petition of Circuit City Stores, Inc. (Circuit City), we agreed to hear this interlocutory appeal of the district court's denial of Circuit City's motion for summary judgment in this race discrimination case, brought pursuant to 42 U.S.C. § 1981. In its order denying Circuit City's motion, the district court held that the arbitration agreement signed by plaintiff Demeka Johnson is unenforceable for lack of consideration. Because we hold that the arbitration agreement is supported by adequate consideration, we vacate the district court's denial of Circuit City's motion for summary judgment and remand for further proceedings consistent with this opinion.
Johnson is a black female and a resident of Beltsville, Maryland. In February 1995, Johnson saw an advertisement for a full-time, permanent sales associate position posted on the bulletin board at Circuit City's Beltsville store. At the time Johnson noticed the advertisement, she was employed as the service manager at a local McDonald's restaurant, where she had been employed since 1993. Upon noticing the advertisement for the position at Circuit City, Johnson obtained an application for the position and checked the box for "Full Time" employment indicating the specific position for which she was applying. (J.A. 109).
After submitting her application, Johnson received no response from Circuit City for several months. During that time, she stopped by and telephoned the store on a number of occasions to inquire about her application, and on one such occasion she was told that her application had been lost. According to Johnson, she ultimately submitted four or five applications for the full-time sales associate position during the period from February to September 1995. The final application, one completed by Johnson on September 6, 1995, is the application at issue in this case.
Contained in the employment application Johnson completed on September 6, 1995 was a Dispute Resolution Agreement. In the preliminary section of the employment application, the application warned with respect to the Dispute Resolution Agreement: (J.A. 105). At the beginning of the section describing the Dispute Resolution Agreement, the application warned further: (J.A. 106). The agreement continued:
I have read this Agreement and understand that I should read the Dispute Resolution Rules and Procedures over the next few days.
I understand that I may withdraw my consent to this Agreement within three (3) days from the date on which I sign below by notifying the Applicant Screening Department in writing ... that I am withdrawing my application for employment at Circuit City. ... I understand that by so notifying the Applicant Screening Department, I will not be bound to this Agreement and that I no longer will be eligible for employment at Circuit City. I recognize that if I sign the Agreement and do not withdraw within three days of signing I will be required to arbitrate any and all employment-related claims I may have against Circuit City, whether or not I become employed by Circuit City.
This Agreement will be enforceable throughout the application process, my employment, and thereafter with respect to any claims arising from or relating to my application or candidacy for employment, employment or cessation of employment with Circuit City. I then must arbitrate all my employment-related claims, and I may not file a lawsuit in court.
(J.A. 106) (emphasis in original). Johnson signed the Dispute Resolution Agreement and provided her social security number. Immediately below her signature, the agreement contained an additional provision, which stated: "Circuit City agrees to follow this Dispute Resolution Agreement and the Dispute Resolution Rules and Procedures in connection with the Associate whose signature appears above." Id. Underneath this provision was the signature of a Circuit City representative. Immediately following the Dispute Resolution Agreement in the application was the following advisory:
STOP!
IF YOU HAVE NOT SIGNED THE AGREEMENT ...
If you have decided not to agree to the terms of the preceding DISPUTE RESOLUTION AGREEMENT then you do not need to complete the balance of this application. We appreciate your interest in the company.
IF YOU HAVE SIGNED THE AGREEMENT ...
If you have decided at this time to agree to the terms of the preceding DISPUTE RESOLUTION AGREEMENT then you will need to complete the balance of this application so that we can continue with your application process.
(J.A. 107) (emphasis in original).
As set forth above, the Dispute Resolution Agreement incorporates the terms of the Dispute Resolution Rules and Procedures (Rules and Procedures). With respect to what claims are subject to arbitration, Rule 2 of the Rules and Procedures provides that "any and all employment-related legal disputes, controversies or claims of an Associate arising out of, or relating to, an Associate's application or candidacy for employment, employment or cessation of employment with Circuit City or one of its affiliates shall be settled exclusively by final and binding arbitration...." (J.A. 112). This rule provides further that all previously unasserted claims arising under federal, state, or local statutory or common law shall be subject to arbitration, including claims arising under the Age Discrimination in Employment Act, Title VII, the Americans With Disabilities Act, the Fair Labor Standards Act, and 42 U.S.C. § 1981. Rule 4 provides for the means by which "[an] Associate shall commence an arbitration." (J.A. 113). Under Rule 11, the Rules and Procedures provide that the arbitrator's authority is "limited to deciding the case submitted by the Associate." (J.A. 117).
According to Johnson, when she submitted her application form, no Circuit City employee discussed with her the application, the Dispute Resolution Agreement, or the Rules and Procedures. In addition, after submitting the application, she was given three books to review, none of which contained the Rules and Procedures the application had advised she read.
Following her submission of the application on September 6, 1995, Johnson was called for an interview at the Beltsville store. Johnson was interviewed by three persons, including the store manager, all of whom indicated to Johnson that they thought she was well qualified and would receive an offer of employment. According to Johnson, during the course of these interviews, she spoke to a Caucasian woman who had applied for a position just one week earlier and was already working. In addition to undergoing interviews, Johnson provided a urine sample and took a written examination. Johnson was subsequently told by a store employee that her application was complete and the results of her tests were "fully successful." (J.A. 60).
Shortly thereafter, the store manager summoned Johnson for a second interview. According to Johnson, the store manager, whose attitude had changed from the previous interview, stated that the purpose of the interview was to make certain that Johnson really wanted the job. The store manager then told Johnson that there were no positions available at the Beltsville store, but that she would forward Johnson's application to two other Circuit City stores. Because Johnson did not have access to transportation to the other stores, Johnson declined the offer to have the store manager forward her application.
During the next several weeks after her second interview, Johnson stopped by the Beltsville store on a number of occasions to see whether the position for which she had applied had been filled. According to Johnson, the store continued to advertise the full time, permanent position as vacant until after this action was filed on October 31, 1995.
Also some time after Johnson's second interview with the store manager, Johnson's mother called Circuit City to complain about her daughter's experience. As a result of these calls, Johnson was put in touch with Cheryl Holland, a district manager for Circuit City...
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