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In affirming denial of a motion to compel arbitration of an employee discrimination suit, a California appellate court held that an employer had waived its right to arbitrate by extensively participating in litigation.
In Amador v. San Diego Country Club, No. D049438, 2007 WL 1991193 (Cal. Ct. App. July 11, 2007), Amador sued San Diego Country Club for employment discrimination. San Diego Country Club filed its answer and asserted as an affirmative defense that both parties were bound by an arbitration agreement. However, rather than filing a motion to compel arbitration, San Diego Country Club answered interrogatories, participated in depositions, and produced documents. Further, San Diego Country Club, in its case management report, checked the box indicating they were willing to participate in mediation, but did not check the box referring to private binding arbitration.
Later, San Diego Country Club moved to compel arbitration. The trial court denied the motion because San Diego Country Club had actively participated in the litigation process. San Diego Country Club appealed.
The Court held that San Diego Country Club had waived its right to arbitrate by participating extensively in the litigation proceedings. Although California law strongly favors arbitration, "the courtroom may not be used as a convenient vestibule to the arbitration hall so as to allow a party to create [its] own unique structure combining litigation and arbitration." Christensen v. Dewor Developments, (1983) 33 Cal.3d 778,784.
San Diego Country Club had participated extensively in litigation and obtained discovery not necessarily available in arbitration. Additionally, it waited almost a year after the suit commenced before moving to compel arbitration. Finally, compelling arbitration would prejudice Amador, as she had incurred $20,000 in legal fees while participating in litigation.
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