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A federal district court in California granted an employer's request to compel arbitration, even though the "original" agreement to arbitrate was not signed by the employee until nearly six months after employment began.
In Morgan v. Countrywide Home Loans, Inc., No. C 06-04766 SI, 2007 WL 80726 (N.D. Cal. Jan. 8, 2007), Morgan claimed that no valid arbitration agreement existed between he and his employer, Countrywide, because requests by Countrywide for an original signed copy of an arbitration agreement evidenced fraud and coercion.
Countrywide responded that Morgan had twice earlier signed agreements identical to the one requested, but had delivered only a photocopy rather than a required original to the company.
Ignoring the fact that he had signed and initialed the application packet as well his offer letter that both included the agreement to arbitrate, Morgan tried to argue that he was unaware of the agreement until after he had quit his previous job, and that he afraid of losing his new job if he did not sign when subsequent requests for an original copy came from Countrywide. The Court rejected these arguments.
The Court concluded that just because Countrywide did not get an original copy of the signed arbitration agreement on file until long after Morgan was employed "does not negate the fact that [he] knew he was required to sign an arbitration agreement, and that he signed such an agreement, before he was hired." A valid agreement existed, and was therefore enforced.
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