Friday, February 9, 2024
Suppose an employer provides notice in its application for employment and its offer letter than employees will be required to sign arbitration agreements in connection with their hiring. Suppose further that when it comes to sign such arbitration agreement, plaintiff instead signs "No Refused." That is what Natalie Ragland did. On that basis, the District Court denied the motion of her former employer, IEC US Holdings (IEC), to compel arbitration.
In Ragland v. IEC US Holdings, Inc., the Eleventh Circuit affirmed. IEC's HR representative testified that when Ms. Ragland wrote "No Refused" on the signature line of the arbitration agreement, she took it to say "Na Ragland." That is believable. The problem for IEC is that Ms. Ragland's scrawled refusal looks nothing like her actual signature (which also looks nothing like her name, to my untrained eye). Both are reproduced in the opinion. IEC argues that Ms. Ragland engaged in some deception, seeming to sign the arbitration agreement. The courts were unmoved. It was IEC's burden to produce evidence that the parties entered into a valid arbitration agreement, and it could not do so. It could only truthfully state that its subjective understanding was that Ms. Ragland had signed her name. But our approach to formation is objective, and objectively speaking, Ms. Ragland had not signed her name.
Ms. Ragland did sign other documents, but those documents did not create an arbitration agreement. The arbitration agreement itself included a merger and integration clause, and the employment application expressly provided that it was not contract. The offer letter is signed, but the arbitration agreement also need to be signed in order to be binding, and Ms. Ragland did not sign the arbitration agreement. Nor did Ms. Ragland accept the arbitration agreement through conduct. She did not work knowing that she had thereby agreed to arbitration. She thought that she had refused to so agree to arbitration, and she was right!
This case makes me gleeful because, like Gerard Manley Hopkins (left), I delight in
All things counter, original, spare, strange;
Who knows why Ms. Ragland did not want to be bound by an arbitration agreement. Who knows why she thinks litigation is the better route for her. It is sweet to see the duty to read used by an employee to the detriment of her employer and it is especially sweet to see a merger/integration clause used to benefit the non-drafting party.
H/t Tamar Meshel.