Rashaan Carter sued SP Plus for alleged minimum wage violations under state and federal law. The company moved to compel arbitration based on a checked box in Carter's onboarding materials, asserting the mark reflected his verbal assent.
U.S. District Judge Elaine Bucklo initially granted a stay pending arbitration, then acknowledged she had jumped the gun by doing so without notice to Carter. Carter then filed an affidavit stating that HR representative Brenjy Etienne filled out and "signed" most of the forms, including the arbitration assent, without explaining them or offering him an option to decline.
Judge Bucklo lifted the stay, finding SP Plus had not engaged with Carter's account and that she could not determine a valid agreement had been formed on the record. SP Plus appealed rather than submit contradicting evidence.
Writing for a unanimous panel, Circuit Judge Frank Easterbrook held that the company forfeited its right to challenge Carter's version of events by failing to present contradicting evidence in the district court.
"Having said nary a peep on the subject in the district court, SP Plus forfeited any opportunity for a hearing," Easterbrook wrote. "This means that the district court's order conclusively denied the request for arbitration and so is appealable."
The panel said it would have been easy for SP Plus to file an affidavit from Etienne attesting that Carter personally agreed to arbitration, "easy, that is, if Etienne remembers obtaining his assent."
Easterbrook rejected the company's invocation of a "strong federal policy favoring arbitration" and its characterization of Carter's affidavit as "self-serving," citing the Supreme Court's 2022 decision in Morgan v. Sundance. "A brief that repeats canards expressly rejected by decisions such as Morgan and Hill is hard to take seriously," he wrote.