On September 16, 2010, three women who were previously employed at Goldman Sachs filed a lawsuit against the company in the U.S. District Court for the Southern District of New York. Represented by private counsel, the plaintiffs alleged that Goldman Sachs engaged in a pattern of gender discrimination in violation of state law and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. Specifically, they alleged that the company discriminated against them through its evaluation, compensation, and promotion policies. The plaintiffs sought injunctive and declaratory relief on behalf of a class of female financial-services employees of Goldman-Sachs who were at the Associate, Vice President, and Managing Director corporate level.

On November 22, 2010, Goldman Sachs filed a motion to stay the claims of one of the three plaintiffs and compel arbitration on the grounds that her claims were subject to an arbitration clause that she signed as part of her employment agreement. The Court (Magistrate Judge James C. Francis IV) denied the motion on April 28, 2011, concluding that, "because an arbitration clause may not be enforced if it precludes the vindication of substantive rights, and because a pattern or practice claim under Title VII can only be brought in the context of a class action, [the plaintiff]'s Title VII claim cannot be committed to arbitration . . . ." Chen-Oster v. Goldman, Sachs & Co., 785 F. Supp. 2d 394, 398 (S.D.N.Y. 2011) rev'd sub nom. Parisi v. Goldman, Sachs & Co., 710 F.3d 483 (2nd Cir. 2013). However, on March 21, 2013, the U.S. Court of Appeals for the Second Circuit (before Judge Barrington D. Parker, Judge Reena Raggi, and Gerard E. Lynch) reversed the District Court's ruling. Parisi v. Goldman, Sachs & Co., 710 F.3d 483, 488 (2nd Cir. 2013). The Second Circuit rejected the view that a preclusion of a pattern-or-practice claim amounts to a deprivation of the plaintiff's substantive rights since "pattern-or-practice simply refers to a method of proof and does not constitute a freestanding cause of action." Id. at 487 (internal quotation marks omitted).

The case is ongoing as of February 20, 2014.

Jordan Rossen - 02/20/2014


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