The Settlements in the Smith Barney and Merrill Lynch Class Action Lawsuits - Section XV - Employment Arbitration - 2nd Edition
Thomas Carbonneau is the Samuel P. Orlando Distinguished Professor of Law at Penn State's Dickinson School of Law. Professor Carbonneau is commonly regarded as one of the world's leading experts on domestic and international arbitration. He serves on the editorial board of La Revue de L'Arbitrage and is the author of ten highly acclaimed books and 75 scholarly and professional articles on arbitration.
Originally from Employment Arbitration - 2nd Edition
The Settlements in the Smith Barney and Merrill Lynch Class Action Lawsuits
Thomas E. Carbonneau
(i) Smith Barney
The circumstances of the Smith Barney Settlement reveal that the viability and legitimacy of the employment arbitration process, especially as it relates to the resolution of Title VII and other civil rights claims, may eventually undergo serious challenge. Along with the courts, some important institutional actors have expressed strong doubts about mandatory employment arbitration. The EEOC now expressly opposes it and the NASD and other stock exchanges have changed their rules, making the arbitration of employee discrimination disputes voluntary under the broker registration agreements.
On May 20, 1996, several former and current female employees filed a class action lawsuit against Smith Barney. In Martens v. Smith Barney, the plaintiffs alleged sexual harassment of and gender discrimination against female employees. Smith Barney, a subsidiary of Travelers Group, Inc., denied the allegations or argued that they were exaggerated. The litigation received attention in the national press for both the character of the plaintiffs’ allegations and the prospect that the matter might be submitted to the mandatory arbitration process in the securities industry.
The parties to the action reached a settlement on November 18, 1997. Plaintiff attorneys, Linda Friedman and Mary Stowell of the Chicago law firm of Leng Stowell Friedman & Vernon, viewed the settlement as an unqualified victory for civil rights and the efforts to eliminate sexual harassment and gender discrimination in the workplace. Although Smith Barney did not expressly admit to wrongdoing, James Dixon, the Chairman and CEO of Smith Barney, issued a letter to Smith Barney employees on November 18, 1997, announcing the settlement.
Section XV. The Settlements in the Smith Barney and Merrill Lynch Class Action Lawsuits
(i) Smith Barney, An Update
(ii) Merrill Lynch