Court Finds Employment Discrimination Claims Must Be Arbitrated, Notwithstanding CPLR 7515

In White v. WeWork Companies, Inc., 20-cv-1800, 2020 WL 3099969 (S.D.N.Y. June 11, 2020), the court, inter alia, granted defendant’s motion to compel arbitration of plaintiff’s discrimination claims.

In reaching this determination, the court considered the application of the relatively recently-enacted Section 7515 of the New York Civil Practice Law and Rules, which (among other things) prohibits prohibits “mandatory arbitration to resolve any allegation or claims of discrimination.”

The court held that CPLR 7515 did not apply here:

The only court to have considered the argument Whyte raises here – that CPLR § 7515 forbids arbitration of employment discrimination claims even when those claims are covered by an agreement “governed by” the FAA – concluded that the newly-enacted statute “present[s] no generally applicable contract defense, and as such cannot overcome the FAA’s command that the parties’ Arbitration Agreement be enforced.” Latif v. Morgan Stanley & Co. LLC, No. 18-cv-11528, 2019 WL 26100985, at *4 (S.D.N.Y. June 26, 2019). There, as here, the agreement in question mandated that all covered claims were to be enforced in accordance with the FAA. There, as here, plaintiff argued that his claims for discrimination, sexual harassment, and retaliation were not covered by the Arbitration Agreement. Judge Cote disagreed, and held that applying CPLR § 7515 to invalidate the parties’ agreement to arbitration the plaintiff’s claims “would be inconsistent with the FAA.” Id. at *3. Because CPLR § 7515 applies to a specific type of claim, rather than a generally applicable defense, it does not fall within the FAA’s savings clause.
The same reasoning applies here. Since CPLR § 7515 is displaced by the FAA, Whyte may not rely on it to defeat WeWork’s motion to compel arbitration. WeWork’s motion to compel arbitration is GRANTED, and the pending action is stayed pursuant to 9 U.S.C. § 3.

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