District courts around the country have begun looking more skeptically at electronically signed arbitration agreements. The Sixth Circuit in Bazemore v. Papa John's USA., Inc.; Papa John's International, Inc., No. 22-6133, recently reversed a trial court's enforcement of one such agreement. On first read, it may seem as though the Court has made enforcement a brass ring much further out of reach; however, a closer review and comparison to other decisions illustrates important factual differences, which lead to the Sixth Circuit's decision. Assessing some of the key facts raised gives guidance to those who might seek enforcement of their own arbitration agreements.

One key fact in Bazemore, which is beyond control of any employer, was sworn testimony that plaintiff had never seen the arbitration form. The Bazemore court differentiated the affirmative testimony that the employee had never seen the document with other cases where an employee "did not recall" signing an arbitration agreement. (Cf Curtis v. Contractor Mgmt. Servs., LLC, 1:15-CV-487-NT, 2018 WL 6071999 (D. Me. Nov. 20, 2018). The Sixth Circuit had previously held that an unequivocal denial of signing an arbitration agreement was sufficient in Boykin v. Fam. Dollar Stores of Mich., LLC, 3 F.4th 832, 839–40 (6th Cir. 2021), and courts from other circuits have agreed. For example, the D.C. Circuit found that an unequivocal denial of signing an agreement was sufficient to create a dispute of fact in Camara v. Mastro's Rests. LLC, 952 F.3d 372, 374 (D.C. Cir. 2020).

Some Eleventh Circuit District Courts have been more strict, however, and found that unequivocal denials without any additional evidence that the signature was forged are insufficient. For example, in Yearwood v. Dolgencorp, LLC, 6:15-CV-00898-LSC, 2015 WL 5935167, at *3 (N.D. Ala. Oct. 13, 2015) the Northern District of Alabama found that after admitting to signing other documents in a similar manner, an unequivocal denial was not enough without additional corroborating evidence, as did other courts in Robson v. D.R. Horton, Inc., 6:21-CV-719-GAP-LRH, 2021 WL 3914474, at *13 (M.D. Fla. Aug. 12, 2021) and, in an Eighth Circuit District Court, Coffey v. OK Foods Inc., 2:21-CV-02200, 2023 WL 122919, at *4 (W.D. Ark. Jan. 6, 2023).

Had the employer had a separate and independent acknowledgement of receipt and execution of key agreements (including the arbitration agreement), the result might be different. Employers should proactively take steps to ensure they will be able to prove an employee's receipt and execution of any pertinent agreements.

Another distinction in Bazemore was the security of the login information used to record the electronic signature. The former employee in Bazemore testified that his login was easily discoverable demographic information, while in cases such as Hill v. Aaron's, Inc., 7:18-CV-1892-TMC, 2019 WL 13258466 (D.S.C. Jan. 7, 2019) or Yearwood v. Dolgencorp, LLC, 6:15-CV-00898-LSC, 2015 WL 5935167 (N.D. Ala. Oct. 13, 2015), the district courts noted the security of the password systems required to log in to sign the documents. The employee in Bazemore also had a clear alternative theory as to how his signature appeared on the form (a supervisor had executed other documents on his behalf), unlike the plaintiff in Soni v. Solera Holdings, L.L.C., 21-10428, 2022 WL 1402046, at *4 (5th Cir. May 4, 2022), who made no specific allegations of alternative execution.

Other courts have similarly raised questions about verification of electronic signatures when the identity of the electronic signor cannot be verified. Requiring employees to establish their own electronic user id and passwords, employee designation, authorization, and assurance of security of personal email addresses used for onboarding and pre-employment verifications, and employing and recording other confirming evidence of electronic execution (verbal, video, audio, etc.) can all provide additional evidence that may be needed to prove employee electronic signatures.

Although the Bazemore ruling seems to add more burdens on an employer seeking to enforce an arbitration agreement, the Sixth Circuit's decision is not a huge departure from prior rulings or where other federal circuits have been moving.

Signatories claiming that they never received a document or that their signatures were forged compromise the core purpose of arbitration agreements by forcing employers to litigate and defend such agreements in evidentiary hearings. However, employers can act to improve their chances of enforcing such agreements:

  • Require that all employees have unique and secure login credentials and passwords;
  • Ensure that all onboarding documents are signed at the same time, place and manner;
  • And, take additional steps to record document execution and employ additional verification processes for electronic signatures.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.