Baker v. Science Applications International Corp.

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 07-2506
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Terrence M. Baker, *
*
Appellant, * Appeal from the United States
* District Court for the
v. * District of South Dakota.
*
Science Applications International *
Corporation, * [UNPUBLISHED]
*
Appellee.
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Submitted: March 13, 2008
Filed: April 15, 2008
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Before RILEY, GRUENDER and SHEPHERD, Circuit Judges.
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PER CURIAM.
In a letter dated October 7, 2002, Science Applications International
Corporation (“SAIC”) made an offer of employment to Terrence Baker. Baker
received various documents from SAIC with the offer letter, including a Mutual
Agreement to Arbitrate Claims (“Arbitration Agreement”) from SAIC. By signing the
Arbitration Agreement, Baker agreed to arbitrate “claims for discrimination” and
“claims for violation of any federal . . . law, statute, regulation or ordinance” against
SAIC. Baker signed the Arbitration Agreement on October 30, 2002, and began his
employment soon after.
In 2005, SAIC terminated Baker’s employment, and Baker subsequently filed
a lawsuit against SAIC under the Americans with Disabilities Act of 1990, 42 U.S.C.
§§ 12101 et seq., the Age Discrimination in Employment Act of 1967, 29 U.S.C. §§
621 et seq., and the Family and Medical Leave Act of 1993, 29 U.S.C. §§ 2611 et seq.
SAIC sought an order compelling arbitration based on the Arbitration Agreement.
Baker argued the Arbitration Agreement was an unenforceable contract of adhesion.
The district court1 held that the parties formed a valid contract to arbitrate and
that the contract was enforceable. As a result, the court entered an order compelling
arbitration and granted a stay pending arbitration. Baker appeals, arguing that the
district court erred in finding that the contract was not a contract of adhesion and in
entering the order compelling arbitration and granting the stay pending arbitration.
He particularly argues that the district court erred by not applying the rationale of the
South Dakota Supreme Court in Rozeboom v. Northwestern Bell Telephone Co., 358
N.W.2d 241 (S.D. 1984), to the Arbitration Agreement. The district court concluded
that Rozeboom was not analogous, primarily because it involved a limitation of
liability clause, not an agreement to arbitrate.
In Rozeboom, the South Dakota Supreme Court noted various “crucial” facts
that led to the conclusion that the contract at issue was an unenforceable contract of
adhesion, including the facts that the case involved an individual versus a monopoly,
that the bargaining power was unequal and that an economic disparity between the
two parties existed. Id. at 245. The court also explained, however, that it did “not
suggest that simply because this contract is standardized and preprinted, ipso facto,
1
The Honorable Lawrence L. Piersol, United States District Judge for the
District of South Dakota.
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it is unenforceable as a contract of adhesion. Rather, we hold that the terms of this
specific standardized contract are unreasonable, oppressive and therefore
unconscionable.” Id. (emphasis added).
Here, there is no indication that Baker could only be employed by SAIC. Baker
sought employment from SAIC, but there is no reason to believe that he could not
have also sought employment elsewhere or that he could only have worked for SAIC.
In fact, according to his resume, Baker has an MBA and twenty years of experience
working in the field of software design and programming. Further, he had the
Arbitration Agreement for twenty-three days before signing it, during which time he
could have consulted an attorney to discuss the terms of the Arbitration Agreement,
attempted to negotiate the terms of the Arbitration Agreement or sought employment
elsewhere. As Rozeboom explained, not every standardized and preprinted contract
is unenforceable as a contract of adhesion. We do not find the terms of the Arbitration
Agreement to be unreasonable or oppressive, and, therefore, under Rozeboom, we find
the Arbitration Agreement not to be an unconscionable contract of adhesion and to be
enforceable.
We agree with the district court’s thorough and well-reasoned opinion in this
matter. Accordingly, we affirm the judgment. See 8th Cir. R. 47B.
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