Second Circuit Enforces Arbitration Agreement, Upholding Class Action Waiver in Title VII Action: The Decision Reverses a District Court Holding that Plaintiffs Have a Statutory Right to Bring Title VII Claims by a Pattern-or-Practice Class Action

Sullivan & Cromwell LLP - March 22, 2013

On March 21, 2013, the Second Circuit reversed a District Court decision that had refused to enforce an individual arbitration agreement between an employer and an employee. In Parisi v. Goldman, Sachs & Co., the Second Circuit reaffirmed the strong federal policy in favor of enforcement of arbitration agreements and rejected the District Court’s adoption of an exception for plaintiffs seeking to bring Title VII actions under the “pattern-or-practice” class action method of proof. The Second Circuit held that plaintiffs have no “substantive statutory right to pursue a pattern-or-practice claim” and, therefore, no non-waivable right to serve as a class representative. Because the District Court had carved out from mandatory arbitration provisions a potentially expansive exception for discrimination claims, the appeal attracted a number of amicus briefs from employer and labor advocacy groups. Sullivan & Cromwell LLP represented Goldman Sachs before the Second Circuit.