Baltazar v. Forever 21, Inc., 2012 Cal. App. LEXIS 1292 (Dec. 20, 2012)
Maribel Baltazar sued her former employer, Forever 21, Inc., alleging she was constructively discharged and subjected to discrimination and harassment based on her race and sex. In response, Forever 21 filed a motion to compel arbitration pursuant to an arbitration agreement between Baltazar and Forever 21. The trial court denied the motion, stating that the arbitration agreement was unconscionable because it required arbitration of employee, but not employer, claims; it gave Forever 21 the right to take “all necessary steps” to protect its trade secrets or other confidential information; and it mandated arbitration even if the agreement were unenforceable. After holding that the agreement was governed by the California Arbitration Act, the Court of Appeal reversed the trial court and held that the agreement was not unconscionable. Although the agreement was one of adhesion, it was substantively acceptable because, among other things, the agreement was bilateral, not unilateral, as it required both Forever 21 and its employees to submit their disputes to final and binding arbitration.