On July 20, the U.S. Court of Appeals for the Sixth Circuit dealt a major setback to Papa John’s effort to enforce an arbitration agreement with its employee, Andrew Bazemore. In Bazemore v. Papa John’s, U.S.A., 74 F.4th 795 (6th Cir. 2023), the Sixth Circuit reversed the U.S. District Court for the Western District of Kentucky’s decision to dismiss the federal action and send the case to arbitration. The Sixth Circuit determined that there was a genuine issue of material fact regarding whether there was an enforceable arbitration agreement.

Similar to the pre-employment conditions of other employers, Papa John’s employees were required to execute various agreements in connection with the commencement of their employment. Bazemore, a delivery driver for a Papa John’s store in Louisville, Kentucky, seemingly signed an arbitration agreement as part of his pre-employment paperwork. This agreement was signed electronically through the use of a software program called e-Forms. Bazemore filed a lawsuit in the District Court for the Western District of Kentucky, alleging that he had been paid below minimum wage in violation of both federal and state wage laws. Papa John’s moved the district court to compel arbitration of his claims.

Both the district court and the Sixth Circuit began their analysis by affirming that the Federal Arbitration Act requires district courts to compel arbitration of claims covered by a valid arbitration agreement. The party seeking arbitration must prove that the agreement exists. If a genuine issue of material fact exists as to whether there is an agreement, the court “shall proceed summarily to the trial thereof.”  9 U.S.C. § 4.

The parties agreed that Kentucky law governed the question of whether Bazemore entered into an arbitration agreement with Papa John’s. Kentucky law requires that each party to an agreement assent to it by “an intentional manifestation of such assent.” An electronic signature can suffice but only when “made by the action of the person the signature purports to represent,” which is itself a question of fact. Friedmann v. Jefferson County Board of Education, 647 S.W.3d 181, 189-90 (Ky. 2022).

In moving to compel arbitration, Papa John’s presented evidence in the form of a declaration from its Senior Director of People Services Brandi Greene. Greene stated that Papa John’s requires all new employees to sign an arbitration agreement as a condition of employment, and that Bazemore had signed the agreement electronically. He had used his user ID and a password, scrolled through the entire agreement, and then checked a box in order to sign. Papa John’s records reflected that Bazemore had followed this process to sign the agreement.

Bazemore submitted his own declaration in opposition, swearing that he “had never seen” the agreement and “had never heard about it.” He stated, among other things, that his login credentials “were clearly made up of demographic information” available from his application, and that he had seen his manager log in for him and other deliver driver “to complete training materials” for them. In addition to submitting his declaration, Bazemore asked for targeted discovery concerning whether he had actually signed the agreement.

After reviewing the evidence, the district court found that Bazemore’s testimony that he had never seen the agreement amounted to “a convenient lapse in memory[.]” The district court denied Bazemore’s request for targeted discovery and granted defendants’ motion to compel arbitration. 

Bazemore appealed, and the Sixth Circuit reviewed the decision de novo. The Sixth Circuit noted that Papa John’s, the party attempting to enforce the arbitration agreement, bore the ultimate burden to establish the agreement’s existence; this was apparently contrary to what the district court concluded. Additionally, the Sixth Circuit noted that “Civil Rule 56 contains no requirement for magic words” regarding whether Bazemore had not signed the agreement. The Sixth Circuit deemed Bazemore’s testimony sufficient to create a genuine issue as to whether he signed the arbitration agreement and held that the record showed that “[a] reasonable factfinder could plainly infer that that, if Bazemore had not seen the agreement, he had not signed it either.”

The Sixth Circuit addressed an additional argument that was raised for the first time on appeal by Papa John’s. Papa John’s argued that Bazemore assented to the terms of the arbitration agreement by “continuing to work for the company after learning about the putative agreement through [the lawsuit].” The Sixth Circuit dispensed with this argument, calling it “meritless” and noting that, pursuant to Kentucky law, the “conduct of a party is not effective as a manifestation of his assent” unless the party has “reason to know that the other party may infer from his conduct that he assents.” The court further noted that Bazemore “had no reason to think that his continued employment could indicate that he has agreed to arbitrate his claims – given that he was, at the same time, arguing in court that he never agreed to arbitration.”

The Sixth Circuit determined that there was a genuine issue of fact. Therefore, it accordingly reversed the district court’s judgment and remanded the case for further proceedings. 

Rowan Leathers and Liesel Carmen-Burks are members of the Labor & Employment Litigation Group at Butler Snow LLP. Rowan concentrates his practice in the areas of advising and representing employers in a broad spectrum of employment-related matters. Liesel has a background in litigation and arbitration matters in the areas of labor and employment and civil rights, on both the plaintiff and defense side.

For years, employers sought to remedy racial imbalances in their workforce by recruiting and hiring racial minorities. Diversity, equity, and inclusion (DEI) efforts have only increased since the protests following the killing of George Floyd which defined the summer of 2020.[i] In the summer of 2023, however, the Supreme Court handed down a decision effectively ending affirmative action in college admissions.

Already since the court’s ruling, many litigants have turned their focus toward invalidating employer DEI efforts, relying in part on the Supreme Court’s ruling in Students for Fair Admissions, Inc. v. President & Fellows of Harvard College (SFFA).[ii]     Looking forward, labor and employment attorneys will need to track litigation trends involving DEI measures, as they must remain prepared to advise employer clients on how SFFA may affect the lawfulness of DEI programs.

The Case

SFFA was a consolidation of two cases, one challenging affirmative action at Harvard College and the other challenging affirmative action at the University of North Carolina (UNC).

Harvard’s admission process required consideration of race once an applicant made it to a certain stage of the admissions process.[iii] When Harvard’s admissions committee made its final cuts, the committee considered several non-academic factors, one of which was the applicant’s race. As a result, according to the court, “race is a determinative tip for a significant percentage of all admitted African American and Hispanic applicants.”[iv]

Race played a factor at two stages in UNC’s admissions process. UNC admissions officers were required to consider race and ethnicity as a factor when making their initial recommendations on whether the applicant should be admitted.[v]  Admissions officers could also offer a “plus” for applicants based on their race in determining whether to recommend admission.[vi] After admissions officers’ initial recommendations, a committee reviewed those initial recommendations, and could also consider race in deciding whether to adopt the officers’ recommendation.[vii] 

Plaintiffs claimed such affirmative action programs remained unconstitutional under the Equal Protection Clause of the Fourteenth Amendment.[viii] The court agreed, holding such affirmative action plans could not survive strict scrutiny.[ix]

Before the SFFA decision, colleges and universities could consider an applicant’s race as one factor in determining whether to admit the student. Following the court’s decision, consideration of race in college admissions is generally limited to how an applicant’s race affects other areas of his or her life. For example, the court stated it would remain permissible for a college to consider “an applicant’s discussion of how race affected his or her life [in an admissions essay] be it through discrimination, inspiration, or otherwise.”[x]

Affirmative Action Plans by Private Employers

Unlike public universities like UNC or public sector employers, private employers are not subject to the Equal Protection Clause of the Fourteenth Amendment. However, employers with 15 or more employees are subject to Title VII of the Civil Rights Act of 1964, which   prohibits employers from “fail[ing] or refus[ing] to hire . . . any individual . . . because of such individual’s race, color, religion, sex, or national origin[.]”[xi] Additionally, Section 1981 of the Civil Rights Act of 1866 (§ 1981) provides, “All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts . . . as is enjoyed by white citizens . . . ”[xii] 

The debate over whether federal laws allow employers to proactively favor minority groups is not new. The United States Supreme Court took up this very question in its 1979 decision in United Steelworkers v. Weber. There, the court held a private employer’s affirmative action plan to hold a certain percentage of positions in a training program open for Black individuals did not violate Title VII. Writing for the majority, Justice William Brennan reasoned Title VII could not be understood to prohibit voluntary employer action to remedy past discrimination because, in passing Title VII, Congress intended to “to cause employers and unions to self-examine and to self-evaluate their employment practices and to endeavor to eliminate, so far as possible, the last vestiges of an unfortunate and ignominious page in this country's history[.]”[xiii] 

Of course, such an allowance is not without parameters. Under prior precedent, an affirmative action plan must be “designed to eliminate manifest racial imbalances in traditionally segregated job categories,” and must not “unnecessarily trammel the interests of” majority employees or require that majority employees be discharged and replaced with minority employees.[xiv] Additionally, the plan must be temporary.[xv]  If an employer’s affirmative action plan meets these marks, the plan constitutes a nondiscriminatory rationale for an employment action under Title VII, overcoming a prima facie showing of a discriminatory employment action.[xvi]

Will the Supreme Court Apply SFFA to Title VII Cases?

It remains too soon to know what effect SFFA will have on employment discrimination cases. Courts developed separate bodies of law for employer affirmative action and college affirmative action, but these bodies of law have generally run parallel with each other and they sometimes overlap.

In Johnson v. Transportation Agency, the court considered whether an employer violated Title VII when it considered an employee’s sex in making promotion decisions to promote females into positions in which females had been underrepresented.[xvii] In finding the employer’s plan did not unnecessarily trample on the rights of male employees, the court noted an applicant’s sex was merely a “plus,” echoing the language of the court’s analysis of college affirmative action plans in Regents of University of California v. Bakke.[xviii] 

Additionally, the Supreme Court has held that cases discussing Fourteenth Amendment principles can provide “helpful guidance” to Title VII cases.[xix] For example, the Supreme Court in Ricci v. DeStefano followed Fourteenth Amendment jurisprudence to conclude an employer can only undertake disparate treatment discriminatory actions to remedy apparent disparate impact discrimination where “the employer can demonstrate a strong basis in evidence that, had it not taken the action, it would have been liable under the disparate-impact statute.”[xx] 

It must also be noted that Justice Gorsuch, joined by Justice Thomas, wrote a concurrence in SFFA, arguing that Harvard and UNC’s affirmative action plans should also be found unlawful under Title VI, the title of the Civil Rights Act prohibiting discrimination in programs receiving federal funding.[xxi] Justice Gorsuch further highlighted the operative language in Title VI is “materially identical” to Title VII’s prohibition on employment discrimination.[xxii] This could very well be seen as a signal of willingness on the part of at least two Justices to apply SFFA’s analysis and conclusion to Title VII cases.

One particular interest group, American Alliance for Equal Rights (AAER), has already filed suits targeting employer DEI initiatives, using the SFFA decision to bolster claims that such initiatives are unlawful.

Following the Supreme Court’s ruling in SFFA, AAER sued two international law firms, Perkins Coie LLP and Morrison & Foester LLP, alleging their 1L fellowship programs open only to members of groups historically underrepresented in the legal profession violated § 1981.[xxiii] The courts were not able to consider SFFA’s effect on private employer’s DEI initiatives, however, as both of these cases have since been dismissed. AAER entered a stipulation of dismissal for both cases when both firms removed the requirement that an applicant be a member in a group historically underrepresented in the legal profession, representing the firms would no longer consider an applicant’s race except as contemplated in SFFA.[xxiv] 

Conclusion

It is unclear at this point what effect SFFA will have on employer DEI efforts. As one federal district court has noted, “[t]he extent to which SFFA overruled the affirmative action plan defense to § 1981 under Johnson, if at all, is unclear.”[xxv]  Labor and employment attorneys will need to keep a close eye on the courts, though, as more lawsuits are likely to follow, asking courts to find that SFFA overrules the Court’s prior decisions in United Steelworkers v. Weber and Johnson v. Transportation Agency. Given the court’s tone in SFFA, especially considering the tone of Justice Gorsuch and Justice Thomas when concurring, employers should also prepare for the real possibility that the Supreme Court could one day soon deem workplace DEI programs unlawful.

Chris McCarty practices employment and education law as a shareholder in the Knoxville office of Lewis Thomason PC. Chris can be reached at CMcCarty@LewisThomason.com. Ryan Shannon practices employment and education law as an associate in the Knoxville office of Lewis Thomason PC. Ryan can be reached at RShannon@LewisThomason.com.

[i] Gaudiano, Paolo. “Two Years After George Floyd’s Murder, Is Your DRI Strategy Performative or Sustainable?” Forbes, https://www.forbes.com/sites/paologaudiano/2022/06/27/two-years-after-george-floyd-is-your-dei-strategy-performative-or-sustainable/?sh=76baa526aaa7 (Oct. 11, 2023).

[ii] 143 S. Ct. 2141 (2023); Monnay, Tatyana. “The Lawyer Who Sued Harvard on Affirmative Action Is Going After Law Firms,” BNN Bloomberg, https://www.bnnbloomberg.ca/the-lawyer-who-sued-harvard-on-affirmative-action-is-going-after-law-firms-1.1962268 (Oct. 11, 2023). 

[iii] Id. at 2154.

[iv] Id. at 2155 (internal quotation marks omitted).

[v] Id. 

[vi] Id. 

[vii] Id. at 2156.

[viii] Id. at 2154.

[ix] Id. at 2175.

[x] Id. at 2176.

[xi] 42 U.S.C. § 2000e-2. 

[xii] Id. at § 1981.

[xiii] United Steelworkers v. Weber, 443 U.S. 193, 204 (1979) (internal quotation marks omitted).

[xiv] Johnson v. Transportation Agency, 480 U.S. 616, 628-30 (1987) (citing Weber, 443 U.S. at 204-208). 

[xv] Id.

[xvi] Id. at 626.

[xvii] 480 U.S. 616, 620-21 (1987). 

[xviii] Id. at 640 (citing Regents of University of California v. Bakke 438 U.S. 265 (1978)).

[xix] Ricci v. DeStefano, 557 U.S. 557, 582 (2009). 

[xx] Id. at 563.

[xxi]  SFFA, 143 S.Ct. at 2208 (Gorsuch, J., concurring).

[xxii] Id. at 2216 (Gorsuch, J., concurring). 

[xxiii] (Case 1:23-cv-23189-KMW, Doc. 1 (S.D. Fla. Aug. 22, 2023); Case 3:23-cv-01877-L Doc. 1 (N.D. Tx. Aug. 22, 2023)).

[xxiv] (Case 1:23-cv-23189-KMW, Doc. 39 (S.D. Fla. Oct. 6, 2023); Case 3:23-cv-01877-L Doc. 31 (N.D. Tx. Oct. 11, 2023).

[xxv] Johnson v. Transportation Agency. Am. All. for Equal Rights v. Fearless Fund Mgmt., LLC, 2023 U.S. Dist. LEXIS 172392, *23 (N.D. Ga. Sep. 27, 2023). 

TBA’s Young Lawyers Division Board members Morgan Hanna and Billy Leslie visited Vanderbilt University Law School today. The meeting was the last of the board’s annual autumn visits to law school across the state. Each visit consists of a panel of YLD members discussing its award-winning Diversity Leadership Institute program and how law students can maximize their benefits of a free TBA membership. In addition, students are given the opportunity to ask questions about preparing for a career in the legal profession. Learn more about YLD or see photos from today's event.

Former state Rep. Jeremy Durham was indicted today on driving under the influence and felony charges in relation to an incident in downtown Nashville last year, NewsChannel 5 reports. An affidavit obtained by the station indicated police responded to a car accident and detained Durham after he attempted to walk away. Records show Durham repeatedly said he was a “lawyer,” while refusing a sobriety test and blood test. Officers also said they found a green metal grinder with marijuana residue. Charges include driving under the influence, felony reckless endangerment of a motor vehicle, resisting arrest, drug paraphernalia and felony aggravated assault with a deadly weapon. Durham represented Franklin from 2013 until 2016 when he was expelled after sexual misconduct allegations, reported at the time by the Tennessean.

Washington County, Maryland, Circuit Court Judge Andrew Wilkinson was fatally shot in the driveway of his home on Friday, triggering a manhunt for a suspect that authorities said was involved in a divorce case heard in the judge's court earlier in the day, reports Reuters. “We are angered at yet another attack on a jurist for doing the job they swore to do. Threats against the judiciary have increased more than fivefold in the past decade, and it needs to stop, said ABA President Mary Smith in a statement. “Judges must be able to decide matters that come before them without fear of reprisal or physical harm to themselves or their families. If they cannot, an essential element of our democracy will be lost.”

The TBA Young Lawyers Division will launch its inaugural Diversity Law Week March 11-16, 2024, across the state, and is looking for attorneys and judges to provide high school students with a unique opportunity to learn firsthand from professionals. Students will shadow legal professionals during the week as well as engage in an immersive experience at a college or law school campus and observe a court proceeding. The goal of the program is to give high school students early exposure to the legal world and resources for a career in law. Those interested in volunteering to help the program are asked to register online. Thanks to YLD President Quinton Thompson for his vision for this program and program coordinators Chattanooga lawyer Ariel Anthony, Memphis lawyer Kevin Christopher and Nashville lawyer Erin Shackelford. Contact TBA Young Lawyers Division & Law Student Development Coordinator Laura Labenberg with any questions.

The U.S. Supreme Court on Friday granted the Biden administration's request to put on hold a preliminary injunction constraining how White House and other federal officials communicate with social media platforms to remove content believed to be misinformation. Reuters reports that the justices also agreed to decide the merits of the administration's appeal of the lower court ruling. Justices Samuel Alito, Clarence Thomas and Neil Gorsuch publicly dissented from the decision. The attorneys general of Missouri and Louisiana and a group of social media users sued federal officials, accusing them of unlawfully helping to suppress conservative-leaning speech on major social medial platforms. Lower courts found that administration officials likely coerced the companies into censoring certain posts in violation of the constitution's free speech protections.

The Tennessee Supreme Court recently issued an order soliciting comments on a proposed change to Rule 9, section 16, which prescribes the procedure for complaints against members of the Board of Professional Responsibility, district committee members and disciplinary counsel. If adopted, these proposed amendments would replace Tennessee Supreme Court Rule 9 section 16 in its entirety. The deadline for submitting written comments is Dec. 12.

Time to update and check-in on the digital YOU. If you moved, have a new photo, or need to change your practice areas or profile — now is the time to update. You also can customize your contact information with TBA’s address preferences, which means you can choose different addresses for your directory listing, where you receive mail and where you receive membership and billing notices. Your TBA profile helps clients and colleagues find you so be sure to keep it current. Watch this tutorial on how to update your information. Looking for a fellow TBA member? Search our online directory.

On Friday, Nov. 3, at 12:15 p.m. CDT during the TBA Health Law Forum, the Health Law Section will host a business lunch and election of officers. At this meeting, section members will acknowledge outgoing chair Mark Ison, and formally vote on incoming section chair Ian Hennessey and incoming vice chair Imad Abdullah. The free plated lunch is open to all Health Law Section members who RSVP. Forum attendance is not required. Limited space is available for the lunch, and the reservation form will close once at capacity. RSVP here.