IBM Moves for Dismissal of Employees’ Age Discrimination Arbitration Lawsuit

On Monday, IBM Corporation argued in favor of dismissal and against summary judgment in a case brought by former employees seeking a declaratory judgment enabling them to proceed with their Age Discrimination in Employment Act (ADEA) claims in arbitration. The memorandum describes the consolidated lawsuit as a “last-ditch effort by Plaintiffs’ counsel to deflect the blame for their own failure to follow basic requirements such as filing timely claims and obeying standard confidentiality rules.”

The Southern District of New York case arose from the plaintiffs’ attempts to circumvent provisions in a contract they reportedly signed with IBM, both ending their employment for reportedly paltry sums and releasing nearly all their legal claims. The plaintiffs assert that they were wrongfully terminated from IBM as part of a company-wide overhaul to oust older employees in favor of younger ones. In late October, the plaintiffs moved for summary judgment.

This week’s filing first argued for dismissal, contending that 23 of the 25 plaintiffs already arbitrated their claims and lost because they were brought too late. The nearly two dozen plaintiffs “then failed to challenge those dismissals because they failed to file timely vacatur actions within the three-month FAA deadline,” the motion says. As such, IBM asserts that their complaints must be set aside as untimely attempts to vacate the arbitration awards.

In addition, IBM alleges that the arbitral timeliness provision is enforceable. “Under the FAA, Plaintiffs’ arbitration agreements must be enforced according to their terms as long as Plaintiffs had a fair opportunity to pursue their ADEA claims in arbitration,” the company contends.

IBM further argues that the plaintiffs’ “novel” claim that the so-called piggybacking doctrine gives them a “substantive, non-waivable right” to file a claim in arbitration outside of the ordinary ADEA limitations period is baseless. This is because the statutory filing period for an ADEA claim is procedural, not substantive, IBM explains.

The motion also assails the plaintiffs’ attempts to invalidate IBM’s arbitral confidentiality provision that the plaintiffs argue unfairly prevents them from drawing on facts and conclusions made in other IBM employment discrimination arbitrations. IBM claims that the terms are not unconscionable and that New York law does not prohibit such provisions.

The motion also argues that the plaintiffs’ bid for summary judgment should be denied as moot. If the court reaches that motion, IBM says it should do so without considering any of the confidential materials appended to the plaintiffs’ briefing. “Plaintiffs obviously attached those confidential materials solely for the improper purpose of trying to destroy confidentiality by using the public-access doctrine to claim that the materials must be made public regardless of whether they prevail in this suit—heads they win, tails IBM loses,” the motion says.

The plaintiffs are represented by Lichten & Liss-Riordan P.C. and IBM by Jones Day.