A former employee [Plaintiff] of International Business
Machines Corporation ([IBM] had signed a separation agreement requiring
confidential arbitration of any claims arising from her termination.* Plaintiff
arbitrated an age-discrimination claim against IBM and won. Plaintiff then filed a petition
in federal district court under the Federal Arbitration Act [FAA] to confirm the award, attaching
it to the petition under seal but simultaneously moving to unseal it.
Shortly after Plaintiff filed the petition, IBM paid the arbitration
award in full. The federal district court granted Plaintiff’s petition to confirm
the award and her motion to unseal the arbitration award.
IBM appealed the district court's unsealing of the award, contending that (1) the petition to confirm
became moot once IBM paid the award, and (2) the district court erred in unsealing
the confidential award.
The United States
Court of Appeals, Second Circuit, agreeing with IBM, explaining that Plaintiff's petition
to confirm her purely monetary award became moot when IBM paid the award in
full because there remained no “concrete” interest in enforcement of the award
to maintain a case or controversy.
The Circuit Court also ruled that any presumption of public
access to judicial documents was outweighed by the importance of confidentiality
under the FAA and the impropriety of Plaintiff’s effort to evade the
confidentiality provision in her arbitration agreement. In the words of the
court, "In short, the presumption of access to judicial documents is outweighed
here by the interest in confidentiality and because [Plaintiff's] apparent purpose
in filing the materials publicly is to launder their confidentiality through
litigation."
Concluding that the district court should not have granted Plaintiff’s
motion to unseal the award," the Circuit Court of Appeals remanded the
matter to the federal district court "with instructions to dismiss the petition as
moot" and reversed the district court's ruling unsealing the award.
* Plaintiff had signed the separation agreement in
exchange for "severance payments and other benefits. The Agreement
included a class- and collective-action waiver requiring claims arising from
her termination—including claims under the ADEA—to be resolved “by private,
confidential, final and binding arbitration.”
Click HERE to access the Circuit Court of
Appeals' decision posted on the Internet.