Court Opinion

ID: 7013978
Source: CourtListenerOpinion
Date Created: 2022-07-24 04:15:00.871135+00
Date Added: 2024-06-11T16:10:18.305134
License: Public Domain

PREGERSON, Circuit Judge,
Dissenting.
I respectfully dissent. The majority concludes that in Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001), the Supreme Court “implicitly overruled” Duffield v. Robertson Stephens & Co., 144 F.3d 1182 (9th Cir.1998). Maj. op. at 996-97. For the following reasons, I would find that Duf-field remains good law.
I.
The issue in Duffield was whether employers may require their employees, as a mandatory condition of employment, to agree to arbitrate future Title VII claims. See Duffield, 144 F.3d at 1185. Based on an analysis of Congress’ intent when it amended Title VII through the Civil Rights Act of 1991, Pub. L. No. 102-166, 105 Stat. 1071 (1991), we held that employers may not require employees, as a mandatory condition of employment, to agree to arbitrate future Title VII claims. See Duffield, 144 F.3d at 1189-90.
The issue in Circuit City was whether the Federal Arbitration Act (“FAA”), 9 U.S.C. § 1 et seq., excludes from its coverage not only employment arbitration agreements by transportation workers, but also employment arbitration agreements by 7iOTC-transportation workers. See Circuit City, 532 U.S. at 109, 121 S.Ct. 1302. Without mentioning Duffield, Title VII, or the Civil Rights Act of 1991, the Supreme Court held that the FAA excludes from its coverage employment arbitration agreement by transportation workers, but not employment arbitration agreements by %o%-transportation workers. See Circuit City, 532 U.S. at 109, 121 S.Ct. 1302.
Duffield and Circuit City are cases of the proverbial apples and oranges: different law, different issues, and different, yet compatible holdings. Most importantly, when the Supreme Court concluded in Circuit City that the FAA covers employment arbitration agreements by non-transportation workers, it did not also implicitly conclude, contra Duffield, that employers may require their employees, as a mandatory condition of employment, to agree to arbitrate future Title VII claims. Whether the FAA covers employment arbitration *1009agreements by non-transportation, workers — the issue in Circuit City — is one question. Whether an employer may require an employee, as a mandatory condition of employment, to agree to arbitrate future Title VII claims — the issue in Duf-field — is an entirely different question. In answering “yes” to the first question, Circuit City did not also implicitly answer “yes” to the second question. “Arbitration under the [FAA] is a matter of consent, not coercion.... ” Volt Info. Scis., Inc. v. Bd. of Trs. of Leland Stanford Junior Univ., 489 U.S. 468, 479, 109 S.Ct. 1248, 103 L.Ed.2d 488 (1989). It is entirely consistent to hold — as the Supreme Court did in Circuit City■ — 'that non-transportation workers who consent in advance to arbitration can later be held to that agreement under the FAA, and to also hold — as we did in Duffield — that employers may not compel their employees to enter arbitration agreements under Title VII. Accordingly, Duffield remains good law after Circuit City, and the District Court’s injunction modeled on Duffield should be affirmed.
II.
The majority advances two arguments in support of its conclusion that Circuit City “implicitly overruled” Duffield. Both arguments are unconvincing.
A.
First, the majority relies on dicta in Circuit City that “arbitration agreements can be enforced under the FAA without contravening the policies of congressional enactments giving employees specific protection against discrimination prohibited by federal law.” Maj. op. at 1002 (quoting Circuit City, 532 U.S. at 123, 121 S.Ct. 1302) (emphasis added).1 The majority claims that this “unambiguous proclamation ... cannot be reconciled with Duf-field’s holding that Congress intended Title VII to preclude compulsory arbitration of discrimination claims.” Maj. op. at 1003 (citing Circuit City, 532 U.S. at 123, 121 S.Ct. 1302) (footnote omitted, emphasis added). In reality, there is no contradiction whatsoever between the Circuit City dicta and the Duffield holding.
In perceiving a contradiction between the Circuit City dicta and the Duffield holding, the majority ignores a crucial word in the Duffield holding: “compulsory.” In Duffield, we referred to arbitration agreements as compulsory “when individuals must sign an agreement waiving their rights to litigate future claims in a judicial forum in order to obtain employment with, or continue to work for, the employer.” See 144 F.3d at 1187.2 The Supreme Court said in Circuit City only that, generally, employees who have *1010agreed to arbitrate future claims under federal anti-discrimination law can be held to such arbitration agreements without violating the policies of federal anti-discrimination law. The Supreme Court did not also say in Circuit City — contra Duffield— that employees can be required, as a mandatory condition of employment, to agree to arbitrate future claims under federal anti-discrimination law without violating the policies of federal anti-discrimination law. Nor is the second statement implied in the first. Perhaps more importantly, the Circuit City dicta that enforcement of arbitration agreements can be compatible with the policies of federal anti-discrimination law does not contradict the Duffield holding that in the case of Title VII, enforcement of compulsory arbitration agreements is always incompatible with the text and legislative history of the § 118 of Civil Rights Act of 1991.
We reached our holding in Duffield after closely following instructions set forth by the Supreme Court in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 111 S.Ct. 1647, 114 L.Ed.2d 26 (1991) in the context of another federal anti-discrimination law, the Age Discrimination in Employment Act (“ADEA”). In Gilmer, the Supreme Court first reiterated that “ ‘[h]aving made the bargain to arbitrate, the party should be held to it unless Congress itself has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue.’ ” 500 U.S. at 26, 111 S.Ct. 1647 (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 628, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985)) (alteration in original). The Supreme Court then placed the burden on the plaintiff, who sought to avoid arbitration of his ADEA claim as per agreement, “to show that Congress intended to preclude a waiver of a judicial forum for ADEA claims.” Id The Supreme Court observed that “[i]f such an intention exists, it will be discoverable in the text of the ADEA, its legislative history, or an ‘inherent conflict’ between arbitration and the ADEA’s underlying purposes.” Id. The Supreme Court examined the ADEA in this regard and held that the plaintiff “ha[d] not met his burden of showing that Congress, in enacting the ADEA, intended to preclude arbitration of claims under that Act.” Id. at 35, 111 S.Ct. 1647.3
In Duffield, we recited these instructions word for word:
“Having made the bargain to arbitrate, the party should be held to it unless Congress itself has evinced an intention to preclude a waiver of judicial remedies for the statutory rights at issue.” Mitsubishi, ... 473 U.S. [at] 628, 105 S.Ct. 3346.... The burden, therefore, is on Duffield to demonstrate that “Congress intended to preclude a waiver of a judi*1011cial forum for [Title VII] claims” in the manner mandated by the [securities registration application], Gilmer, 500 U.S. at 26, 111 S.Ct. 1647.... “If such an intention exists, it will be discoverable in the text of [the act at issue], its legislative history, or an ‘inherent conflict’ between arbitration and the [act’s] underlying purposes.” Id. at 26, 111 S.Ct. 1647....
Duffield, 144 F.3d at 1190. We moreover closely followed these instructions in Duffield when we found that “Congress’ intent to preclude the compulsory arbitration of Title VII claims is conclusively demonstrated in the text and/or legislative history of the Civil Rights Act of 1991....” Duffield, 144 F.3d at 1189-90 (emphasis added); compare with Gilmer, 500 U.S. at 26, 111 S.Ct. 1647.
Section 118 of the Civil Rights Act of 1991 provides: “Where appropriate and to the extent authorized by laiv, the use of alternative means of dispute resolution, including ... arbitration, is encouraged to resolve disputes arising under [Title VII].” Pub. L. No. 102-166, § 118, 105 Stat 1071 (1991), reprinted in notes to 42 U.S.C. § 1981 (emphasis added). Regarding the text of § 118, we observed that especially in light of the limiting phrases “[w]here appropriate” and “to the extent authorized by law,” “it would seem entirely disingenuous to fasten onto ... one word,” i.e., encouraged, “and conclude that Congress was boundlessly in favor of all forms of arbitration.” Duffield, 144 F.3d at 1193. Indeed, given that encouragement implies voluntariness and requirement implies involuntariness, Congress’ instruction in § 118 that “arbitration ... is encouraged” if anything seems to contradict the majority’s conclusion that arbitration may be required as a condition of employment under Title VII. We concluded that “the text of [§ 118] is, at a minimum, ambiguous,” and we therefore turned to the legislative history of that section. Duffield, 144 F.3d at 1193. Because our detailed discussion in Duffield of § 118’s legislative history unequivocally supports our holding in that case, and because the majority in the present case does not address any part of that discussion, I reproduce that discussion below at some length:
Congress in fact specifically rejected a proposal that would have allowed employers to enforce “compulsory arbitration” agreements. It did so in the most emphatic terms, explaining that:
H.R. 1 includes a provision encouraging the use of alternative means of dispute resolution to supplement, rather than supplant, the rights and remedies provided by Title VII. The Republican substitute, however, encourages the use of such mechanisms “in place of judicial resolution.” Thus, under the latter proposal employers could refuse to hire workers unless they signed a binding statement waiving all rights to file Title VII complaints .... American workers should not be forced to choose between their jobs and their civil rights.
H.R. Rep. No. 40(1) at 104 (emphasis added). This rejection of the “Republican” proposal provides ... “strong evidence” of Congress’ intent ... to preclude compulsory arbitration of civil rights claims and to “encourage” only voluntary agreements — agreements that do not require potential employees to waive their right to litigate in a judicial forum as a mandatory condition of employment. ... The [House] Committee [on Education and Labor]’s view of § 118 was reiterated by key congressmen in the floor debates, who repeatedly stated that § 118 encouraged arbitration only “where parties knowingly and voluntarily elect to use those methods.” 137 Cong. Rec. S15478 (daily ed. Oct. 30, 1991) (statement of Sen. Dole); see *1012also 137 Cong. Rec. H9548. (daily ed. Nov. 7, 1991) (statement of Rep. Hyde) (explaining that § 118 encourages arbitration where “the parties knowingly and voluntarily elect” to submit to such procedures). The most informed and important statements were made by Representative Edwards, the Chairman of the House Committee on Education and Labor. Representative Edwards unequivocally explained .during the debate immediately prior to the [Civil Rights] Act [of 1991]’s passage ...: [“]This section contemplates the use of voluntary arbitration ..., not coercive attempts to force employees in advance to forego statutory rights.... [”] [137 Cong. Rec. H9530 (daily ed. Nov. 7, 1991) (statement of Rep. Edwards)] (emphasis added). Finally, President Bush echoed Congress’ understanding of the arbitration section in signing the Act, stating that “section 118 encourages voluntary agreements between employers and employees to rely on alternative mechanisms such as mediation and arbitration.” Statement of the President of the United States, Signing Ceremony, Pub. L. No. 102-166 (Nov. 21, 1991), reprinted in 1991 U.S.C.C.A.N. 768, 769 (emphasis added).
Duffield, 144 F.3d at 1196-97 (footnote omitted). Notwithstanding the majority’s unsupported statement that the Duffield court “pick[ed] and cho[se] snippets of legislative history consistent with its desired result,” maj. op. at 1001, there can be little doubt in the correctness of the conclusion by the Duffield court that arbitration agreements required by employers from their employees as a condition of employment are not “voluntary arbitration agreements between employers and employees” as envisioned by Congress for Title VII. Duffield’s holding that enforcement of compulsory arbitration agreements violates the text and legislative history of § 118 of the Civil Rights Act of 1991 is compatible with Circuit City dicta that enforcement of consensual arbitration agreements does not violate the policies of federal anti-discrimination law.
B.
Second, the majority claims that “the Supreme Court’s emphatic reminder [in Circuit City] that the right to a judicial forum is not a substantive right contradicts Duffield’s fundamental supposition that the Act guaranteed a nonwaivable, substantive right to a jury trial.” Maj. op. at 1003. The majority attempts to support this claim by comparing the Supreme Court’s statement in Circuit City that “by agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute,” 532 U.S. at 123, 121 S.Ct. 1302 (quoting Gilmer, 500 U.S. at 26, 111 S.Ct. 1647 (1991) (quoting Mitsubishi, 473 U.S. at 628, 105 S.Ct. 3346)), with our holding in Duffield that “under the Civil Rights Act of 1991, employers may not [through compulsory arbitration agreements] compel individuals to waive their Title VII right to a judicial forum,” 144 F.3d at 1185. See maj. op. at 1000. Nowhere in Duffield, however, did we suggest that this “right to a judicial forum” is a substantive right, as the majority claims. Indeed, our statement in Duffield that the Civil Rights Act of 1991 “increased substantially the procedural rights and remedies available to Title VII plaintiffs,” 144 F.3d at 1189 (emphasis added), suggests, to the contrary, that we perceived the right to a jury trial as a procedural right. Duffield, then, “was not premised ... on the arbitral forum causing a loss of substantive rights.” Melton v. Philip Morris, Inc., No. Civ. 01-93-KI, 2001 WL 1105046, *3 (D.Or. Aug. 9, 2001). Instead, “Duf-field found ‘the context, language and [legislative] history ... make out a conclusive case ... that Congress intended to preclude compulsory arbitration of Title VII claims.’ ” Id. (quoting Duffield, 144 F.3d *1013at 1199). Accordingly, the Supreme Court’s statement that “[b]y agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute,” Circuit City, 532 U.S. at 123, 121 S.Ct. 1302 (quoting Gilmer, 500 U.S. at 26, 111 S.Ct. 1647 (1991) (quoting Mitsubishi, 473 U.S. at 628, 105 S.Ct. 3346)), does not contradict our conclusion that “Congress intended to preclude compulsory arbitration of Title VII claims,” Duffield, 144 F.3d at 1199.
Most damaging to the majority’s argument is that already in Duffield, we considered the very language which the Supreme Court later quoted in Circuit City — and which the majority now concludes “contradicts” our holding in Duf-field — and concluded that this language was compatible with our holding there. We first wrote: “We recognize that, as the Supreme Court has stated, agreements to arbitrate must generally be treated not as ‘forego[ing] the substantive rights afforded by [a] statute,’ but rather as merely changing the forum in which they are protected. Gilmer, 500 U.S. at 26, 111 S.Ct. 1647 ... (quoting Mitsubishi, 473 U.S. at 628, 105 S.Ct. 3346....)” Duffield, 144 F.3d at 1199. We then explained:
Yet even assuming that the general federal policy in favor of arbitration would ordinarily apply to the compulsory arbitration of civil rights claims, we are not free to apply that policy here. Where Congress has manifested its intent, with regard to arbitration questions and otherwise, the Supreme Court has made it abundantly clear that the judiciary is not free to “legislate” its own contrary preferences.
Id. (citing Brogan v. United States, 522 U.S. 398, 406-07, 118 S.Ct. 805, 139 L.Ed.2d 830 (1998)).
According to the majority, Circuit City contradicted Duffield by merely re-quoting language from Gilmer and Mitsubishi; language which we already considered in Duffield and found compatible with our holding there. The majority reads too much into Circuit City. Circuit City added nothing to the interpretation of the Gil-mer/Mitsubishi language. In particular, Circuit City did not contradict the interpretation of that language in Duffield. In the end, the majority does no more than register its own disagreement with this court’s earlier interpretation of the Gil-mer/Mitsubishi language in Duffield. But as the majority acknowledges, such disagreement by one panel of this court with a prior panel of this court is not a proper ground for reconsidering the decision of the prior panel. See maj. op. at 1002 (citing United States v. Gay, 967 F.2d 322, 327 (9th Cir.1992)).4
*1014III.
Less than four years ago, the Supreme Court denied certiorari in Duffield. See Duffield v. Robertson, Stephens & Co., 525 U.S. 982, 119 S.Ct. 445, 142 L.Ed.2d 399 (1998). Last year, the same Supreme Court decided a different issue in Circuit City without as much as mentioning Duf-field. In the present case, the majority, after brushing aside Duffield’s careful statutory interpretation as an “exercise,” maj. op. at 1000, and reading into Circuit City what isn’t there, somehow reaches “the inevitable conclusion” that Duffield has been “implicitly overruled” and “no longer remains good law,” maj. op. at 1003, 1008. The majority recognizes that it is error for one panel of our court to “remed[y]” 'the decision of another panel of our court, unless “a decision of the Supreme Court requires th[e] panel” to do so. Maj. op. at 1002.5 Indeed, we observed in Gay that “one three-judge panel of this court cannot reconsider or overrule the decision of a prior panel,” except “when ‘an intervening Supreme Court decision undermines an existing precedent of the Ninth Circuit, and both cases are closely on point.’ ” 967 F.2d at 327 (quoting United States v. Lancellotti, 761 F.2d 1363, 1366 (9th Cir.1985)). Because no intervening decision by the Supreme Court has undermined Duffield’s holding, it is error for the majority to reconsider that holding.
Perhaps most disturbing is that the majority does not consider the consequences of its holding today. By allowing employers to require their employees, as a mandatory condition of employment, to agree to arbitrate future Title VII claims, the majority allows employers to force their employees to chose between their jobs and their right to bring future Title VII claims in court. That choice, of course, is no choice at all.6 There may be “real benefits to the enforcement of arbitration provisions.” Maj. op. at 1002 (quoting Circuit City, 532 U.S. at 122-23, 121 S.Ct. 1302).7 *1015That does not justify allowing employers to shove arbitration provisions down the throats of individual employees as a nonnegotiable precondition of employment.
I dissent.

. The above quoted passage from Circuit City is dicta because it refers only to federal anti-discrimination law and Circuit City involves exclusively state anti-discrimination law. See 532 U.S. at 110, 123, 121 S.Ct. 1302. Needless to say, such dicta cannot overrule — not even explicitly and much less ''implicitly” — a holding, like the one in Duffield. This fact by itself invalidates the majority’s first argument in support of its conclusion that Circuit City "implicitly overruled” Duffield. But even if this were not enough, there are — as shown below — additional reasons to reject the majority’s first argument.

. In Duffield, we thus did not use the term "compulsory arbitration” as it is traditionally defined. See Black’s Law Dictionary 100 (7th ed. 1999) (defining "compulsory arbitration” as "[ajrbitration required by law or forced by law on the parties”). "Compulsory arbitration,” both as we used that term in Duffield and as it is traditionally defined, must furthermore be distinguished from "mandatory arbitration.” See, e.g., Koveleskie v. SBC Capital Mkts., Inc., 167 F.3d 361, 362 (7th Cir.1999) (employing the term "mandatory arbitration” to reflect "the contractual situation where if one party to a dispute requests arbitration, the other party is obliged to arbitrate”).

. It is misleading to state, as the majority does, that the Supreme Court held in Gilmer that “an employer could compel arbitration of an employee’s ADEA claim pursuant to an arbitration provision required as a condition of his employment." Maj. op. at 999. The Supreme Court indeed stated the question presented as "whether a claim under the [ADEA] can be subjected to compulsory arbitration pursuant to an arbitration agreement in a securities registration application.” Gilmer, 500 U.S. at 23, 111 S.Ct. 1647. But the Supreme Court did not use the term "compulsory” in the sense given to that term in Duf-field, i.e., requiring an employee to sign an arbitration agreement as a condition of employment. See supra note 2 and accompanying text. Rather, the Supreme Court used the term "compulsory” in the sense of "mandatory,” i.e., contractually required. See id. And while the arbitration provision at issue in Gilmer was indeed required as a condition of employment, this was not made an issue by the Supreme Court, which held more generally that the plaintiff “ha[d] not met his burden of showing that Congress, in enacting the ADEA, intended to preclude arbitration of claims under that Act.” Gilmer, 500 U.S. at 35, 111 S.Ct. 1647. Thus, there is no conflict between Gilmer and Duffield.

. For the same reasons, the Supreme Court's subsequent statement in EEOC v. Waffle House, Inc., 534 U.S. 279, 122 S.Ct. 754, 765 n. 10, 151 L.Ed.2d 755 (2002), that "[the Supreme Court has] held that federal statutory claims may be the subject of arbitration agreements that are enforceable pursuant to the FAA because the agreement only determines the choice of forum” does not make "Duffield's continuing validity ... questionable” or "cast doubt as to whether Congress precluded compulsory arbitration of Title VII claims,” contrary to what a panel of this court recently suggested in Circuit City Stores, Inc. v. Najd, 294 F.3d 1104 (9th Cir.2002). See id. at 1107 (stating that "[ultimately," the Najd court did not have to "decide whether Duf-field remains good law because Najd did not sue under Title VII”), see also id. at 1110 (Paez, J., concurring) (criticizing the Najd majority's “assault on the validity of Duffield” as "entirely unnecessary” and “merely gratuitous”). In support of its statement that federal statutory claims may be the subject of enforceable arbitration agreements because such agreements determine only the choice of forum, the Waffle House Court — like the Circuit City Court — merely re-quoted the same passage from Gilmer and Mitsubishi which we already considered in Duffield and found compatible with our holding there. See Waffle House, 122 S.Ct. at 765 n. 10, 122 S.Ct. 754 (quoting Gilmer, 500 U.S. at 26, 111 S.Ct. *10141647 (quoting Mitsubishi, 473 U.S. at 628, 105 S.Ct. 3346)).

. It is, therefore, irrelevant whether "[s]ince our Duffield decision in 1998, our Sister Circuits as well as the Supreme Courts of California and Nevada have unanimously repudiated its holding.” Maj. op. at 1001-02. Moreover, six of the ten cases from other circuits cited in support of this statement were decided before Duffield. In none of these six cases was the question at issue in Duffield and in the present case — whether employers may require employees, as a condition of employment, to agree to arbitrate future Title VII claims — a question that was explicitly decided contra Duffield.

. More than three-quarters of a century ago, Andrew Furuseth, then president of the International Seaman's Union of America, said in opposition to the FAA as originally proposed: "Will such contracts be signed? Esau agreed, because he was hungry.... With the growing hunger in modern society, there will be but few that will be able to resist.” Proceedings of the 26th Annual Convention of the International Seaman's Union of America 203-204 (1923). This still holds true today, if employers are allowed lo require their employees, as a condition of employment, to agree to arbitrate their future Title VII claims. It was for this reason that in 1991, Congress rejected a "Republican substitute” for § 118 which would have allowed such compulsory arbitration agreements. Congress explained that "American workers should not be forced to choose between their jobs and their civil rights.” H.R. Rep. No. 40(1) at 104 (emphasis added).

.There are also well-known "potential disadvantages” from the employees' point of view, such as "waiver of a right to a jury trial, limited discovery, and limited judicial review.” Armendariz v. Found. Health Psychcare Servs., Inc., 24 Cal.4th 83, 99 Cal.Rptr.2d 745, 6 P.3d 669, 690 (2000) (noting also that "[v]arious studies show that arbitration is advantageous lo the employers ... because it reduces the size of the award that an employee is likely to get, particularly if the employer is a ‘repeat player' in the arbitration system”). See also Paladino v. Avnet Computer Techs., Inc., 134 F.3d 1054, 1062 (11th Cir.1998) (noting that "[a]rbitralion ordinarily brings hardship for litigants along with potential effi*1015ciency” because ‘‘[a]rbitral litigants often lack discovery, evidentiary rules, a jury, and any meaningful right to further review"); Katherine Eddy, Note, To Every Remedy a Wrong: The Confounding of Civil Liberties Through Mandatory Arbitration Clauses in Employment Contracts, 52 Hastings L.J. 771, 776-77 (2001) (noting that "[a]nolher major disadvantage [of arbitration] to employee-plaintiffs is the lack of diversity among the arbitrators from which the employee may choose” because, for example, "[o]f the 50,000 arbitrators on the American Arbitration Association panels, only 6% are women”).