Second Circuit Vacates Order Denying Arbitration of Former Department Store Employee’s ADA Claims

The United States Court of Appeals for the Second Circuit has vacated a district court’s order stating a former department store employee cannot be compelled to arbitrate his Americans with Disabilities Act claims against the store.  In Weiss v. Macy’s Retail Holdings, Inc., No. 17-2219 (2d Cir., July 12, 2018), a man with a learning disability, Weiss, was hired by Macy’s in 1997.  In 2003, Macy’s instituted an employee dispute resolution process that required all disputes with the company to be resolved through mandatory arbitration.  Although Macy’s held in-person training programs regarding the dispute resolution process and mailed an opt-out form to Weiss’ home on two separate occasions, he failed to return a signed opt-out form to the retailer.

In 2015, Weiss was terminated from the department store.  In response, he filed a lawsuit against Macy’s claiming he was fired due to his learning disability in violation of the Americans with Disabilities Act.  The department store responded to the lawsuit by filing a motion to compel the case to arbitration based on the dispute resolution process that was instituted by the company in 2003.  A trial court denied the retailer’s motion based on the court’s finding that the opt-out form was “counterintuitive, ambiguous, and misleading” and Weiss did not accept the dispute resolution process.

Next, Macy’s filed an appeal with the Second Circuit.  After reviewing the case record, the appellate court said in a summary order: “we are satisfied that the documents, if received by Weiss, coupled with his failure to send back the opt-out form and his continued working for Macy’s, bound him to arbitrate his dispute.” After that, the court turned to Weiss’ claim that he never received either copy of the company’s dispute resolution process opt-out form in the mail.

The court stated:

Here, Weiss offered more than a “mere denial of receipt.” Meckel, 758 F.2d at 817. He provided evidence of his family’s regular procedure for reviewing with him the mail he received and asserted, with sworn support, that the relevant mailings did not arrive and go through that process. We conclude, therefore, that Weiss has sufficiently rebutted New York’s mailing presumption to create a disputed issue of material fact. See D.M. Rothman & Co. v. Korea Commer. Bank of N.Y., 411 F.3d 90, 97 (2d Cir. 2005) (defendant rebutted mailing presumption by introducing certified mail receipt showing that delivery was late); Hogarth v. N.Y.C. Health & Hosps. Corp., No. 97 CIV. 0625 (DAB), 2000 WL 375242, at *4 (S.D.N.Y. Apr. 12, 2000) (“For example, the presumption of delivery can be successfully rebutted with a sworn affidavit giving a detailed description of the mail procedures followed at a company for all incoming mail supporting the conclusion that the mail was never received.”); State v. Int’l Fid. Ins. Co., 708 N.Y.S.2d 504, 507 (App. Div. 2000) (concluding plaintiff “rebutted the presumption of receipt” with “affidavits and deposition testimony describing the extensive search of the Department’s offices over a period of several days and the procedures it followed for mail received and improperly delivered”); De Leonardis v. Gaston Paving Co., 706 N.Y.S.2d 254, 255 (App. Div. 2000) (“diary of incoming mail maintained in the usual course of business and office practice” sufficient to rebut presumption).

The District Court, ruling only on the absence of contract formation, did not resolve this contested factual issue regarding whether Weiss received the mailings that would have allowed him to opt out of mandatory arbitration. Because Weiss cannot be bound by an offer to agree to arbitrate that he did not receive, we conclude that a remand is appropriate to determine whether Weiss received the documents.

Finally, the Second Circuit Court of Appeals vacated the district court’s order and remanded the case for further proceedings.

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