Lambert v. Tesla

Affirming the district court’s order compelling arbitration, the panel held that racial discrimination claims under 42 U.S.C. § 1981 may be subjected to compulsory arbitration.

Following the reasoning of EEOC v. Luce, Forward, Hamilton & Scripps, 345 F.3d 742 (9th Cir. 2003) (en banc), addressing the arbitrability of Title VII claims, the panel held that § 1981 claims are arbitrable. Applying the Gilmer test, Luce, Forward concluded that § 118 of the Civil Rights Act of 1991, amending both Title VII and § 1981, does not bar arbitration.

Concurring, Chief Judge Thomas agreed that Luce, Forward was dispositive but wrote separately because he believes that Luce, Forward was wrongly decided. Chief Judge Thomas wrote that the statutory text of § 118, stating that arbitration should be encouraged to the extent it is appropriate and authorized by law, is ambiguous. Considering the legislative history, compelling arbitration in § 1981 actions defies Congress’s intent.

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