Goldman Duped Women Into Giving Up Right to Sue, Lawyers Say

Goldman Sachs Group Inc. tricked women into waiving their right to sue the firm, the women said in asking a court to bar the firm from forcing them into arbitration in a closely watched gender bias case.

In a filing on Thursday, the women asked the federal judge overseeing the class action lawsuit — one of the biggest pay discrimination suits targeting a financial firm — to reject a magistrate’s recommendation last month granting Goldman’s request to move 1,850 of the claims to arbitration.

Those claims represent most of the class suing the firm in a 14-year battle over allegations that Goldman let managers make biased pay decisions and denied women opportunities they deserved. The case looms large on Wall Street, where the biggest U.S. banks are led by men.

The women contend that almost 1,200 of the claims should be removed from the arbitration pool. They say the bank waited too long to press for arbitration in some cases and got women to sign improper agreements in exchange for stock awards and other compensation.

Fine Print?

Goldman’s arbitration position “is so grossly unreasonable or unconscionable in light of the mores and business practices of the time and place as to be unenforceable,” according to the filing.

“We said at the time we were pleased with the court’s decision,” Goldman spokeswoman Maeve DuVally said. “That continues to be the case.”

Read More: Goldman Forces Women Into Arbitration in Gender-Bias Case

In all, the class suing Goldman has grown to more than 3,000 claimants, of whom U.S. Magistrate Judge Robert Lehrburger recommended 1,850 go to arbitration. Of those, the women argue, 1,159 should be removed from the arbitration pool.

A 2018 ruling letting four women who worked for the bank represent the class came in the wake of Supreme Court decisions making it harder for workers in industries from retail to technology to win class action status in employment disputes.

Arbitration has become one of corporate America’s most powerful weapons for confronting discrimination claims, allowing employers to remove the leverage that class action status provides and to force workers to pursue their grievances one by one.

Lehrburger concluded last month that most of the arbitration clauses in question were enforceable and that Goldman asserted them promptly after the suit became a class action. The plaintiffs’ lawyers countered that Goldman had litigated some of the cases for years before trying to arbitrate them.

The case is Chen-Oster v. Goldman Sachs & Co., 10-cv-6950, U.S. District Court, Southern District of New York (Manhattan).

— With assistance by Chris Dolmetsch

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