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Packin v. Astra USA1/29/2002
Robert Packin filed this action against Astra USA, Inc. for termination of his employment in violation of the Fair Housing and Employment Act (FEHA) and against Astra and fellow employees Elizabeth Mandl, Donna Matas, and Cheryl Bondy for defamation. Astra and the individual defendants filed a motion to stay this action in favor of arbitration pursuant to a written arbitration agreement. The trial court denied the motion, finding the arbitration agreement unconscionable and unenforceable. All defendants appeal, and we affirm.
FACTS
Packin was employed in 1991 as a district sales manager by Astra, a pharmaceutical company headquartered in Massachusetts. In 1994, Astra issued a memorandum to all employees informing them that it had established an arbitration procedure to resolve employment disputes "in a timely manner at significantly lower costs for all." Employees were assured that the procedure would be fair and impartial and that "arbitrators will apply and use the same laws to decide a case that a judge or jury would have used." All nonprobationary employees were required to sign the arbitration agreement or they would not receive "any future allocations to the Astra Profit Sharing Program."
Packin declared he first learned about the arbitration agreement during a company conference on the East coast, when "Astra representatives got up and discussed the benefits of this agreement for employees." He was concerned "about possibly being the only person in the room who did not sign," because " t Astra, there was a continual turnover of people who complained and then were fired." At that time, Packin needed nine months for his interest in the company pension plan to vest and did not want to jeopardize his job. "That vesting had a value of between $40,000 to $50,000 to me." Packin signed the agreement.
Two years later, Packin's employment was terminated. Astra claimed the termination was due to Packin's acts of sexual harassment, but he believed it was because of his age and his complaints about age discrimination in the company. He filed this action against Astra asserting claims under FEHA for age discrimination and retaliation, and against Astra and the individual defendants for defamation; he also sought a declaration that the arbitration agreement was unconscionable and unenforceable.
The arbitration agreement provides that an employee must submit a claim to arbitration "not later than 180 days after the date the employee learned or should have learned of the facts forming the basis of the claim(s)." If the parties are unable to agree on an arbitrator, Astra will submit the demand to the American Arbitration Association in Boston, Massachusetts "whose procedures will be used only to select an arbitrator." The arbitrator must apply Massachusetts law and is limited to determining whether Astra's actions were discriminatory or tortious; the arbitrator has no authority to decide whether the type of employee discipline used by Astra was appropriate. The arbitrator's choice of awards to the employee is limited to reinstatement; "full or partial back pay, and reimbursement for lost fringe benefits, without interest, reduced by interim earnings, benefits received, and amounts that could have been received with reasonable diligence"; up to 12 months of front pay, "if reinstatement is not practical or reasonable"; and punitive damages up to 12 months pay. There is no limitation on damages if the award is in favor of Astra. The costs of the arbitration will be shared equally by the employee and the company, "either party has the right to have the hearing transcribed by a certified court reporter at its own expense," and each party will bear its own attor
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