Neiman Marcus won a partial victory in its appeal of a lawsuit brought by a Fashion Island jewelery department salesperson who claims she was wrongly fired, unjustifiably fingered as a thief, stiffed out of sales to her return customers and ridiculed for being Muslim.
While agreeing mostly with a trial court's ruling against the department store's idea of arbitration, ex-saleslady Mariam Berri (who ought to consider a run for D.C. mayor) still has some form of conflict settlement in her future following the 2-1 ruling filed Tuesday by the state's Fourth District Court of Appeals in Santa Ana.
Berri originally sued Neiman Marcus and two former
co-employees for damages based on her termination at the Newport Beach
store. She described herself in the complaint as “a very successful
salesperson” in Neiman's fine jewelry department with a loyal clientele
of repeat customers. She alleged she was making more than $275,000
annually in commissions at the time things went to merde.
claimed Neiman had a policy where the first salesperson to make a sale
to a particular jewelry customer in effect “owned” that customer, and
other salespeople could not sell jewelry to that person in the future.
Berri alleged the policy led to disputes with the employees she's now suing–disputes she claims Neiman management always resolved in her colleagues' favor.
blames the animosity from this as being behind accusations in June 2008
that she stole a ring belonging to one of the co-workers named in the
suit. Theft reports were filed internally and with the Newport Beach
Police Department, resulting in Berri being arrested, charged with a
felony and fired from her job. The charges were later dropped.
She sued Neiman
for breach of contract, breach of the covenant of good faith and fair
dealing , wrongful termination in violation of public policy. Berri
also sued Neiman and the two individual employees for defamation, based
on the ring incident, and Neiman and one of the individual employees
for malicious prosecution, based on her arrest for theft and the
subsequent dismissal of the charges against her.
In the lower court, Neiman filed the motion to compel arbitration, claiming that Berri signed an agreement to settle
employment disputes via arbitration. But the trial court found
conditions of that agreement “ambiguous,” “unconscionable” and ultimately “unenforceable.” The main basis for that ruling was the “delegation clause” or duties spelled out in the
Neiman arbitration pact.
So, Neiman appealed the rejection of the motion, leading to this opinion written by Associate Justice Eileen C. Moore, in concurrence with Associate Justice Kathleen E. O'Leary:
“We agree the delegation clause was ineffective, based
on language in another clause in the agreement that rendered it
ambiguous. The trial court erred, however, in finding the agreement as a
whole unconscionable. The parts of the agreement that led to this
conclusion were severable. We therefore reverse and remand, directing
the trial court to consider severability issues as appropriate before
ordering the case to arbitration.”
So, Neiman Marcus will
eventually get arbitration, just not the arbitration it originally sought. Berri
will have her case decided by an arbiter rather than trial court but at least many
terms of the arbitration she opposed will get tossed, such as
the Neiman demand that arbitration only take place in the company's home
state, Texas. Both the trial and appeals courts rejected that notion.
Dissenting Associate Justice William W. Bedsworth
disagreed that there was anything wrong with the delegation clause,
found there is nothing ambiguous about the case at all and believed that Neiman's motion
to arbitrate under the terms of the original agreement should be granted.
“All of the unconscionability issues identified in
the majority opinion are, I believe, for the arbitrator to decide,”
When it comes to the actual merits of Berri's complaint, the appeals court did find some trouble spots for whoever ultimately decides this turkey, such as the allegation of “wrongful termination in violation of public policy.”
last claim is somewhat puzzling,” read the “Facts” of the appellate decision. “Although Berri alleged that she
was terminated because of her 'complaints about harassment, hostile work
environment, and the failure of Defendant Neiman to pay her monies to
which she was lawfully entitled,' there were no factual allegations of
sexual harassment or other harassment or hostility based on a protected
“Berri alluded to some comments made by the employees
about her Muslim faith, but she did not allege any facts indicating an
adverse employment action was against her on account of her religion.
She also alleged no Fair Employment and Housing Act (FEHA) or Labor Code
causes of action. Apparently Berri's 'public policy' cause of action
against Neiman was rooted, like the other two, in the disputes about who
'owned' certain customers and the fallout from these disputes.”
Berri is represented by Robert S. Kostrenich of Exodus Law Group in Orange.