Friday, January 9, 2015

Employer Waives Right to Arbitrate by Participating in Discovery

Bower v. Inter-Con Security Sys., Inc., No. A135940 (D1d3 Dec. 31, 2014)

This is a wage and hour class action where the plaintiff signed an employment agreement containing an arbitration provision with a class action waiver. But the employer didn’t immediately move to compel. Instead, it both responded to and propounded discovery, including discovery on class issues. Only after plaintiff tried to expand the class and efforts to settle the case on a class-wide basis failed did it move to compel the case to arbitration. But the trial court ruled that, by that time, it had waived the right to compel. The court of appeal affirms. Although the evidence on the issue was mixed there was substantial evidence to support the trial court’s decision that defendant was aware of its right to arbitrate, that it acted inconsistently with that right, and that plaintiff was prejudiced.


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