Winston & Strawn. Courtesy photo

A former Winston & Strawn partner who is suing the firm for alleged gender bias urged the U.S. Supreme Court on Wednesday to uphold a California state court ruling that kept her claims in court and out of arbitration.

Constance Ramos, represented by Karla Gilbride of Public Justice, sued the law firm in California state court, claiming discrimination, retaliation, wrongful termination and anti-fair-pay practices. She alleged she was unfairly passed over for work and effectively forced out of the law firm. Ramos now works at her own firm, Akira IP.

Ramos' case is one of several in recent years to allege discrimination against women at major U.S. law firms. One Big Law firm and other business advocates have urged the Supreme Court to rule for Winston & Strawn and to protect the power of employers to resolve workplace claims through arbitration.

The law firm's “overly harsh” terms in its partnership agreement drove the lower court opinion, Gilbride told the justices Wednesday. Chief among those terms that the lower court found unconscionable, Gilbride said, was the “firm always wins” clause. That provision, with one exception, barred the arbitration panel from substituting its judgment for the decisions of the partnership, its executive committee or officers.

That clause, Gilbride said, “would make it impossible for the arbitrators to award Ramos back pay, front pay, reinstatement or punitive damages—essentially every form of relief she sought in her complaint for employment discrimination and retaliation.”

Gilbride told the justices, “This court should not step in to rescue Winston from the consequences of the contract it drafted.”

In November, a three-judge panel of the California Court of Appeal ruled that the entire Winston & Strawn arbitration agreement was “unconscionable” and void.

Joshua Rosenkranz, partner at Orrick, Herrington & Sutcliffe, filed a petition for review in the high court on behalf of the law firm. In his petition, Rosenkranz argues California courts have persistently defied the justices' “clear rulings” on arbitration, specifically by relying on the 2000 state court decision in Armendariz v. Foundation Health Psychcare Services.

The Armendariz ruling predates the justices' 2011 arbitration ruling in AT&T Mobility v. Concepcion, which required courts to place arbitration agreements on an equal footing with other contracts. The Armendariz decision imposes arbitration rules that conflict with Concepcion and are preempted by the Federal Arbitration Act, or FAA, Rosenkranz argued.

“In the wake of Concepcion, no other jurisdiction has held that arbitration-specific rules like these survive FAA preemption,” Rosenkranz told the justices in May. He argued that “California courts need another reminder” to follow the Supreme Court's precedence on enforcement of arbitration agreements. “It is time,” Rosenkranz wrote.

But Ramos countered that the appellate court would have reached the same result independent of the Armendariz ruling, “consistent with a broad consensus on the unconscionability of remedy limitations in adhesive contracts” and the unseverability of the “firm always wins” clause.

“Winston chose to include that highly unusual 'firm always wins' clause in its partnership agreement, and it is that decision—not anything the California Supreme Court said 20 years ago in Armendariz—that placed Winston in the position in which it now finds itself,” Gilbride said in Wednesday's filing.

The arbitration agreement, according to the state appellate court, included such “unconscionable” terms as requiring Ramos to pay her own legal fees and to share the costs of the arbitration. The confidentiality provisions also were too restrictive, the court said, and would hinder Ramos' ability to conduct informal interviews of potential witnesses.

The appellate court ruling reversed a San Francisco trial court decision in favor of the law firm. The trial court had held that Ramos' signed partnership agreement governed her claims.

Ropes & Gray filed an amicus brief supporting Winston & Strawn. “Today, it is common for law firms to experience regular fluctuations in their partnership ranks,” Douglas Hallward-Driemeier, head of the firm's appellate and Supreme Court practice, said in the brief. “As a result, it has become increasingly important for law firms to be able to quickly and efficiently resolve internal disputes in a way that protects confidential information and minimizes disruptions to client service.”

Also supporting the law firm's petition for review are DRI-The Voice of the Defense Bar, represented by Matthew Nelson of Warner Norcross + Judd in Grand Rapids, Michigan; the Washington Legal Foundation, Atlantic Legal Foundation, Civil Justice Association of California and Center for Workplace Compliance.

 

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