Publications

New York’s highest court recently decided a case of first impression regarding a financial services industry employee’s challenge to an arbitration agreement.  In Matter of Lorraine C. Brady v. The Williams Capital Group, L.P., 2010 NY Slip Op. 02434 (Mar. 25, 2010), the employee challenged a fee-sharing provision requiring her to split the cost of an arbitrator with her employer.  The New York Court of Appeals held that when presented with such a challenge, lower courts must resolve the question of whether the employee is financially able to share the costs.  The Court set forth a new standard by which lower courts must resolve the financial ability question, including certain factors that must be considered.  Significantly, the Court left open the question of what the remedy should be if the cost-sharing provision is found unenforceable and raised the possibility, notwithstanding the existence of an otherwise valid and enforceable arbitration agreement, of allowing an employee to elect to proceed in court instead.