Lyster v. Ryan’s Family Steak Houses, Inc

239 F.3d 943 (8th Cir. 2001)

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Nature of the Case

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Facts

Lyster (P) applied for employment with Ryan's (D) on March 5, 1998. P signed a Job Application Agreement to Arbitration of Employment-Related Disputes (“Agreement”) with Employment Dispute Services, Inc. (“EDSI”) which provided that P would submit any employment-related dispute with D to arbitration. D was named as a third-party beneficiary of the Agreement. P submitted a claim of sexual harassment to the Equal Employment Opportunity Commission (“EEOC”) and the Missouri Commission on Human Rights (“MCHR”) and received a right-to-sue letter. The district court concluded under the Agreement P was required to arbitrate her claim only if she filed her claim with the EEOC and the MCHR before she was terminated. If P was terminated prior to filing her claim, the district court concluded the Agreement would be unenforceable because the Agreement terminated when her employment with D ended. D did not provide sufficient information to the district court regarding the timing of P's termination in relation to the filing of her claim with the EEOC and the MCHR, the district court denied D’s petition to compel arbitration and motion to dismiss, or alternatively, to stay the proceedings. D contends that the Agreement requires P’s employment-related claims against it be arbitrated even if the Agreement has terminated since the date of the claim. P contends the Agreement specifically excluded all EEOC matters from arbitration and P did not agree to arbitrate her Title VII claims. P further asserts her claim and cause of action for sexual harassment did not accrue until EEOC gave a right to sue, which occurred after the Agreement terminated. P also argues the Agreement is an unconscionable adhesion contract.