In a first-of-its-kind challenge to a growing national trend to force employees to waive their right to sue, the American Civil Liberties Union of Southern California filed lawsuits against two companies for firing an employee who refused to sign an agreement forcing him to accept binding arbitration to resolve any work-related disputes.

The lawsuits, Lagatree vs Keesal, Young & Logan [Case 185962] and Lagatree v Luce, Forward, Hamilton & Scripps [Case 185963], were filed Friday in State Superior Court against two Southland legal firms who tried to force Donald Lagatree of Long Beach to sign a final and binding arbitration agreement waiving his right to go to court with any future disputes he might have with the companies.

The ACLU charges that the defendants have violated Mr. Lagatree's right to bring disputes to court and to trial by jury as guaranteed by the First and Seventh Amendments of the United States constitution and articles 1 and 16 of the California constitution, as well other state and federal statutes concerning the rights of employees.

"Most of us need to work, " said David Schwartz, Senior Staff Counsel of the ACLU of Southern California. "Employers are taking unfair advantage of that fact by bullying employees into giving up rights in exchange for getting or keeping their jobs. When an employee finds he or she has a claim, suddenly it hits them that they can't take their employer to court. It's grossly unfair for companies to force employees to check their constitutional rights at the office door."

Plaintiff Donald Lagatree is a professional legal secretary. In March of 1994, he was hired by the law firm of Keesal, Young & Logan after working there for six months in a full-time temporary capacity. Mr. Lagatree received satisfactory or better job performance reviews. In June 1997, the firm asked him to sign a pre-printed standard arbitration agreement requiring him to waive his right to go to court over claims against his employer such as fraud, breach of contract or even "whistle blower" claims.

After receiving the form, Mr. Lagatree told the management, including a firm partner, that he did not wish to agree to arbitration of any future disputes and would, therefore, not sign the agreement. On June 30, 1997, Mr, Lagatree was fired for refusing to sign the arbitration agreement.

On September 12, 1997, Mr. Lagatree was offered a position as legal secretary with the law firm of Luce, Forward, Hamilton & Scripps and to report for work on September 16. On his first day of work, after beginning his job duties, Mr. Lagatree was given a memo entitled "Letter of Employment," which confirmed the offer of employment and contained the following paragraph:

In the event of any dispute or claim between you and the firm (including employees, partners, agents, successors and assigns), including but not limited to claims arising from or related to your employment or termination of your employment, we jointly agree to submit all such disputes or claims to confidential binding arbitration, under the Federal Arbitration Act.

On September 18, 1997, Mr. Lagatree informed the management of Luce, Forward, Hamilton & Scripps that he did not wish to give up his right to take disputes to court and that he would refuse to sign the Letter of Employment. At a meeting with management, Mr. Lagatree was told that the arbitration agreement was not negotiable and that his employment was contingent upon his signing the agreement. Mr. Lagatree declined to sign the letter and he was immediately let go.

The ACLU of Southern California has won a major victory for low-income residents of HUD-subsidized housing. At a news conference this morning, the ACLU announced the signed settlement agreement in Des Verney vs Alliance Housing Management [97-8576 AAH (Mcx)], a federal lawsuit filed last November on behalf of three residents of Holiday Venice, a HUD-subsidized unit in Venice California.

Under terms of the settlement, the housing management company will not require residents to sign the new lease agreement "mandated by HUD" holding them responsible for the crimes of visitors. Specifically, language added by Alliance Housing Management under what they termed new HUD mandated rules, would have subjected plaintiffs and their children to eviction based on the acts, occurring as far as three blocks away, of guests committed without tenants' knowledge or ability to prevent them.

Speaking at the news conference, ACLU staff attorney Daniel Tokaji said, "We hope that this settlement sends a loud and clear message: Public housing tenants have the same right as anyone else to be secure in their homes. It is a great victory, not only for these three women but for the Bill of Rights."

The lawsuit charged that the new mandatory lease agreement violated the constitution and current federal statutes and regulations for HUD-subsidized housing because it penalized tenants for conduct over which they have no control. The settlement prohibits the housing management company from retaliating in any way if residents do not sign the addendum. In addition, Alliance Housing agrees not to enforce the addendum against any other tenants of the Holiday Venice properties.

ACLU staff attorney Rocio Cordoba said at the news conference, "This settlement vindicates the constitutional rights of lowincome residents nationwide who refuse to become casualties of extreme "onestrike" eviction policies, such as the one advanced in the challenged lease addendum. All tenants regardless of economic status have the same fundamental rights to freely invite friends and family members into their homes without fear of eviction over circumstances beyond their control."

The federal lawsuit was filed last November on behalf of three residents of Holiday Venice, a HUD-subsidized housing unit located in Venice, California. The three women were threatened with eviction because they refused to sign a new lease agreement.

On December 10, Alliance Housing sent the ACLU of Southern California a letter saying it would withdraw its requirement that residents of its government-subsidized properties sign the new lease agreement. This settlement finalizes that agreement for all residents of the Venice development and sets a powerful precedent against similar attempts by other landlords in the future.

The legal action followed a September 1997 new lease addendumwhich Alliance Housing said was required by HUDthat would have subjected Holiday Venice residents to one-strike evictions if they, or any member of their household, guest or other person under the resident's control, were to "engage in or facilitate criminal activity...within a three block radius of the property." -

While all of the plaintiffs strongly support drug-free housing and a crime-free environment and have personally worked to promote these goals, they refused to sign the lease addendum because it would penalize them for the conduct of other persons over which they have absolutely no control.

The Notice of Change of Lease Terms stated, in part:

"Resident, any member of the Resident's household, or guest or other person under the Resident's control shall NOT engage in or facilitate criminal activity, including drug-related criminal activity, ON or NEAR the property premises, "NEAR" meaning within a three block radius of the property, but not limited to violent criminal, gang, prostitution or gambling criminal activity. "DRUG-RELATED CRIMINAL ACTIVITY" means the illegal manufacturer [sic], sale, distribution, use or possession with intent to manufacture, sell, distribute, or use a controlled substance....VIOLATION OF THE ABOVE PROVISIONS SHALL BE MATERIAL VIOLATION OF THE LEASE AND GOOD CAUSE FOR TERMINATION OF TENANCY."

On September 25, plaintiffs received a memo from Alliance threatening eviction because they had not signed the new rental lease agreement. Plaintiffs responded through attorneys in writing that they objected to the new agreement because it violated their basic civil liberties, but received no response. On November 3, Alliance Housing sent plaintiffs another memo threatening eviction as of December 1, for failure to sign the new mandatory rental agreement. The ACLU filed a federal lawsuit on November 21. The finalized settlement announced today removes the threat of eviction for any resident who does not sign the new lease agreement.

On February 3, the District Court for the Northern District of California dismissed existing litigation challenging the constitutionality of Proposition 209 prior to its actual enforcement. Plaintiffs had previously requested that the Court dismiss this litigation in light of the Ninth Circuit ruling on April 8, 1997 upholding the measure against a facial, pre-enforcement constitutional challenge.

Mark Rosenbaum, Legal Director of the ACLU Foundation of Southern California and one of the attorneys for plaintiffs, stated that the Order "clears the way for future legal challenges to actual implementation of Proposition 209."

Rosenbaum stated "Proposition 209 has not seen the last of California's courtrooms. The Court's Order only concludes chapter one of a much longer work yet to be completed."