The 14-year battle over allegations that Goldman Sachs let managers make biased pay decisions that denied women opportunities they deserved looms large on Wall Street, where the biggest U.S. banks are all led by men.
Goldman Sachs, which has called the discrimination claims meritless, had no immediate comment on Thursday’s ruling. A lawyer for the women vowed to challenge it, calling the bank’s litigation strategy “shocking.”
A 2018 ruling allowing four women who worked for the bank to represent a group that’s grown to more than 3,000 was significant following Supreme Court decisions that have made 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 fending off discrimination claims, allowing employers to take away the leverage that class-action status provides and forcing workers to pursue their grievances one-on-one.
Critics of arbitration call it a shadow justice system that’s tilted in favor of companies. Lawyers who represent employees generally prefer presenting their cases to juries, which are seen as more likely to issue large punitive damages awards than arbitrators, who are often retired judges.
Lawyers for the women suing Goldman Sachs asked a Manhattan federal judge in June to stop the bank from forcing more than 1,000 of them into arbitration, arguing the bank waited too many years to try to push them out of open court and into closed-door proceedings.
On Thursday, U.S. Magistrate Judge
“There is no evidence of deceptive conduct, no evidence of coercion, no evidence of targeting putative class members, no evidence of imposing arbitration without agreement or without additional consideration,” the judge said.
“We think it is shocking and patently unjust for Goldman to wait for nine years after the case was filed to raise these issues and for Goldman to receive only a slap on the wrist for its misconduct in slamming so many women with expansive arbitration clauses buried in equity award agreements,”
(Updates with comment from lawyer for women in final paragraph.)
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