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Employer agreement can authorize the recovery of attorney fees for a successful motion to compel arbitration of a FEHA lawsuit if the employer demonstrates that the plaintiff’s opposition to the arbitration was frivolous, unreasonable, or groundless

California

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USA

FEHA's Asymmetric Standard for Awarding Attorney Fees Cannot Be Contracted Out of in an Arbitration Agreement In Patterson v. The Superior Court, B312411 (Cal. Ct. App. Oct. 18, 2021), the petitioner filed a petition for writ of mandate, prohibition, or other appropriate relief with the California Court of Appeal for the Second District, arguing that the superior court had erred in awarding their employer the attorney fees they had incurred in moving to compel arbitration.The Court of Appeal granted the petition and issued a writ of mandate directing the superior court to vacate its order and schedule a hearing to determine whether the plaintiff’s opposition to the motion to compel arbitration was frivolous, unreasonable, or groundless, as this is a prerequisite to awarding a defendant attorney fees and costs in an action brought under the Fair Employment and Housing Act (“FEHA”). The Asymmetric FEHA Standard for an Award of Attorney Fees and Costs The Court explained that in cases brought under FEHA, an asymmetric standard for an award of attorney fees applies. Under this standard, codified at subdivision (b)(6) of Cal. Gov. Code § 12965, courts are authorized to award reasonable attorney’s fees and costs to the prevailing party in FEHA cases, but a defendant shall not be awarded fees and costs unless the court finds that the action was frivolous or groundless. Predispute Arbitration Agreements of FEHA Claims Cannot Limit Statutorily Imposed Remedies The Court explained that employees who enter predispute arbitration agreements can be compelled to arbitrate FEHA claims, but that such arbitration agreements cannot limit statutorily imposed remedies like punitive damages and attorney fees.The Court found that the asymmetric standard for an award of attorney fees and costs is a statutory right and pre-dispute arbitration agreements cannot waive this right. The Court noted that applying this asymmetric rule for attorney fees to the arbitration agreement, in this case, was not preempted by the Federal Arbitration Act because the rule is a broadly applicable substantive right and did not only apply to arbitration.

April 14, 2022
Patterson v. The Superior Court, B312411 (Cal. Ct. App. Oct. 18, 2021)
California Courts