Sexual Orientation Discrimination Claim Must Be Arbitrated; Consent to Arbitration Was “Knowing and Voluntary”

In Hermés of Paris, Inc. v. Swain, No. 16-CV-6255 (CM), 2016 WL 4990340 (S.D.N.Y. Sept. 13, 2016), the court granted the request by petitoner (Hermes) to compel arbitration of the respondent/employee’s claims. Respondent, who worked in one of Hermes’ retail locations, filed a lawsuit in New Jersey state court alleging claims of sexual orientation discrimination, creation of a hostile work environment, retaliation, and breach of contract.

The court held that it had subject matter and personal jurisdiction over plaintiff, and that the parties’ arbitration agreement was valid.

As to jurisdiction, the court explained: “A federal court has the authority to compel arbitration under the Federal Arbitration Act[], 9 U.S.C. § 4, provided that the court has jurisdiction over the underlying controversy.”

The court held that it had subject matter jurisdiction over the matter (based on diversity of citizenship). It next determined that it had personal jurisdiction over Mr. Swain, “since he agreed to arbitrate his employment related disputes in New York City” and “[a] party who agrees to arbitrate in a particular jurisdiction consents to both personal jurisdiction and venue of the courts within that jurisdiction.”

Turning to the validity of the arbitration agreement, the court noted that “[b]efore compelling arbitration, the district court must determine whether the parties enter[ed] into a contractually valid arbitration agreement, and if so, whether the parties’ disputes fall within the scope of the arbitration agreement.” Mr. Swain conceded that his claims were covered by the agreement, asserted that there was no evidence that he entered into the agreement knowingly and voluntarily.

In finding the agreement valid, Judge McMahon explained:

The Dispute Resolution Agreement, produced by Petitioner, contains Swain’s signature below a line that states, in bold, that his signature means that you have read this agreement, understand it and are voluntarily entering into it. Nothing in the record suggests that the signature was forged or made involuntarily, and Petitioner’s argument that he needs discovery to ascertain the validity of his own consent is ludicrous, since the information he needs is entirely within his own control. Because Respondent has the burden of proof in establishing that his claims should not be arbitrated, it is incumbent on him to provide the court with some evidence — for instance, a sworn affidavit — to establish that his consent was not voluntary. Having failed to produce any such evidence, there is no basis on which to find the agreement invalid.