Gupta v. Morgan Stanley Smith Barney, LLC, No. 18-3584 (7th Cir. 2019)Annotate this Case
Gupta joined Morgan Stanley and signed an employment agreement containing an arbitration clause; an employee dispute resolution program (CARE) applied to all U.S. employees. The CARE program did not then require employees to arbitrate employment discrimination claims but stated that the program “may change.” In 2015, Morgan Stanley amended its CARE program to compel arbitration for all employment-related disputes, including discrimination claims, and sent an email to each U.S. employee, with links to the new arbitration agreement and a revised CARE guidebook. The email attached a link to the arbitration agreement opt-out form and set an opt-out deadline, stating that, if the employee did not opt-out, continued employment would reflect that the employee agreed to the arbitration agreement and CARE guidebook and that opting out would not adversely affect employment status. Gupta did not submit an opt-out form or respond to the email. He continued to work at Morgan Stanley for two years until, he alleges, the company forced him to resign because of military leave. Gupta sued for discrimination and retaliation under the Uniformed Services Employment and Reemployment Rights Act, 38 U.S.C. 4301–35. The court agreed with that Illinois law permits an offeror to construe silence as acceptance if circumstances make it reasonable to do so; based on pretrial evidence, Gupta could not dispute he received the email. The Seventh Circuit affirmed an order compelling arbitration under the Federal Arbitration Act, finding the existence of a written agreement to arbitrate, a dispute within the scope of that agreement, and a refusal to arbitrate.