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Employer Failed To Prove That Employee Signed Arbitration Agreement
Maureen Bannister worked in the administrative offices at a skilled nursing facility for approximately 30 years before Marinidence Opco LLC (Marinidence) purchased the facility. One year after the purchase, Marinidence terminated Bannister.
Thereafter, Bannister filed a lawsuit against Marindence alleging discrimination, retaliation, and defamation. Marinidence filed a motion to compel arbitration, alleging that when it purchased the facility, Bannister electronically signed an arbitration agreement when completing the paperwork for new Marinidence employees. Bannister opposed the motion and asserted that she never saw or electronically signed the arbitration agreement during the onboarding process, and presented evidence to that effect.
The trial court held that Marindence failed to prove that Bannister signed the arbitration agreement and denied its motion to compel arbitration. Marindence appealed.
On appeal, the court noted that Marinidence presented evidence that Bannister signed the arbitration agreement during the onboarding process, including that employees had to enter their first and last name and Social Security number in order to access the online onboarding portal and had to complete the W-4 tax withholding and emergency contact form before accessing the arbitration agreement. Marinidence also presented two declarations from employees Barbara Matson and Brian Ullrich who asserted that they sat next to Bannister for 30 to 45 minutes while she completed the entire onboarding process on the computer. Matson and Ullrich did not affirmatively state they witnessed Bannister click “I accept” or electronically sign the arbitration agreement.
However, Bannister presented evidence that she did not touch the computer during that process and never reviewed or signed any arbitration agreement. Bannister asserted that Matson completed the onboarding process herself on her laptop for employees without their participation, and was able to do so because she had access to employees’ first and last names and Social Security numbers from their personnel files. Bannister further asserted that Matson asked Bannister for her information including her tax withholdings and emergency contacts and did not show her the laptop screen as she entered the information or provide her any copies of documents. Bannister also asserted that as Matson completed the onboarding process for Bannister and other employees, she did not inform them about an arbitration agreement nor did she have them click “I agree” or otherwise electronically sign the arbitration agreement. Bannister presented evidence through emails between herself and Matson, that Matson continued to complete the onboard process for employees remotely from her office after leaving the facility.
The court found that substantial evidence supported the trial court’s conclusion that Marinidence failed to authenticate the electronic signature on the arbitration agreement as Bannister’s, and that the trial court reasonably held that Matson and Ullrich’s declarations did not establish that Bannister herself electronically signed the arbitration agreement. The court noted that Bannister was not “assigned a unique, private user name and password such that she is the only person who could have accessed the onboarding portal and signed the agreement; instead, the evidence showed … Matson had access to the information necessary to access the onboarding portal via employee personnel records.”
The court affirmed the trial court’s ruling and conclusion that Marinidence failed to meet its burden of proving the existence of an arbitration agreement by a preponderance of the evidence. Marindence failed to show that the signature on the arbitration agreement was put there by Bannister, and Bannister’s evidence showed that she was not the only person who could have executed the arbitration agreement.
Bannister v. Marinidence (2021) 64 Cal.App.5th 541.
This case adds to the dearth of case law related to electronic signatures and the issues that may arise related to the authenticity of electronic signatures. The safest and most conservative course of action is to require signatures on hard copies of contracts, such as enrollment and employment agreements. If private K-12 schools, colleges, and universities utilize electronic signatures on documents, they should implement measures to verify and prove that the person whose electronic signature appears on the contract is the person who actually signed the contract.