ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Monday, July 14, 2014

Ninth Circuit Enforces Class-Action Waiver Despite Federal Statutes

9th CirFatemeh Johnmohammadi was an employee of Bloomingdale's, Inc. (Bloomingdale's).  She sought to bring a state class-action claim alleging that she and others, similarly situated, were owed overtime wages.  Bloomindale's removed the case to federal court and then filed a motion to compel arbitration of Johnmohammadi's claims.  The District Court granted the motion and dismissed the case without prejudice.  Johnmohammadi appealed to the Ninth Circuit.

In Johnmohammadi v. Bloomingdale's, Inc., the Ninth Circuit affirmed the District Court's decision.  The Court found that there is no question that Johnmohammadi voluntarily agreed to Bloomingdale's arbitration agreement, which also included a class action waiver.  The arbitration agreement included an opt-out option of which Johnmohammadi did not avail herself.

On appeal, Johnmohammadi argued that the class-action waiver is unenforceable because its enforcement would violate the Norris-LaGuardia Act and the National Labor Relations Act both of which protect the rights of employees to engage in "concerted activities."  While the Court noted that there is some support for Johnmohammadi's position, the cases she cited applied only where an employer forces employees to waiver their rights as a condition of employment.  Here, because of the opt-out option, Johnmohammadi was held to have voluntarily agreed to Bloomingdale's terms.

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