Guyden v. Aetna, Inc.

544 F.3d 376, 28 I.E.R. Cas. (BNA) 289, 2008 CCH OSHD 32,970, 2008 U.S. App. LEXIS 20783, 91 Empl. Prac. Dec. (CCH) 43,337, 2008 WL 4426478
CourtCourt of Appeals for the Second Circuit
DecidedOctober 2, 2008
DocketDocket 06-4954-cv
StatusPublished
Cited by85 cases

This text of 544 F.3d 376 (Guyden v. Aetna, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Guyden v. Aetna, Inc., 544 F.3d 376, 28 I.E.R. Cas. (BNA) 289, 2008 CCH OSHD 32,970, 2008 U.S. App. LEXIS 20783, 91 Empl. Prac. Dec. (CCH) 43,337, 2008 WL 4426478 (2d Cir. 2008).

Opinion

HALL, Circuit Judge:

Plaintiff-Appellant Linda Guyden sued Defendant-Appellee Aetna, Inc. for terminating her employment in violation of the whistleblower protection provision of the Sarbanes-Oxley Act. Based on an arbitration clause in an agreement between Guy-den and Aetna, the district court dismissed the complaint in favor of arbitration. On appeal, Guyden argues that her whistle-blower claim under the Sarbanes-Oxley Act is nonarbitrable because arbitration is inconsistent with the purpose and structure of the Act. She also challenges the specific arbitration procedures established by the arbitration agreement, claiming that the procedural limitations it imposes will prevent her from vindicating her statutory rights. We hold that claims brought under the Sarbanes-Oxley Act are arbitra-ble, and we further hold that the specific arbitration process established by the arbitration agreement at issue provides Guy-den with an adequate opportunity to enforce her statutory rights. Accordingly, the judgment of the district court is AFFIRMED.

BACKGROUND

I. Guyden’s Relationship with Aetna 1

In January 2004, Guyden joined Aetna as its Director of Internal Audit. Soon after starting, Guyden alleges that she discovered that Aetna’s Internal Audit Department was “ineffective, demoralized, and without independence or objectivity.” According to Guyden’s complaint, these problems were so serious that she believed that Aetna was in danger of violating the Sarbanes-Oxley Act of 2002, Pub.L. No. 107-204, 116 Stat. 745 (2002) (“SOX”). SOX, and regulations promulgated thereunder, require corporate officers to report on the effectiveness of internal controls over financial reporting, and they prohibit those officers from characterizing the controls as “effective” if “there are one or more material weaknesses.... ” 17 C.F.R. § 229.308(a)(3). Guyden claims that she reasonably believed that Aetna was at risk of violating this regulation because (1) the Internal Audit Department was ineffective, and (2) that ineffectiveness, if left unaddressed, would become a material weakness in the company’s internal controls.

Guyden responded by attempting to rehabilitate the Internal Audit Department. In need of more resources and greater authority to make changes within the Department, she also brought her concerns to the attention of senior management. During the course of her discussions with senior management about those concerns, Guyden and management clashed over a number of issues, including the possibility of an outside audit and Guyden’s efforts to restructure her Department. Over the spring of 2004, Guyden sought assistance from Aetna’s Chief Financial Officer, Alan Bennett. Guyden found Bennett’s response wanting, and on August 16, 2004, she raised her concerns to Chairman and Chief Executive Officer John (“Jack”) Rowe, President Ron Williams, and Gener *380 al Counsel Lou Briskman. About one week after this meeting, Bennett gave Guyden a “withering” performance review, despite having given her a positive review one month earlier.

Guyden eventually prevailed in hiring an outside auditor to review Aetna’s internal controls. According to the complaint, senior management prevented the distribution of the outside auditor’s report until September 30, 2004, one week after the Audit Committee had held its scheduled meeting. That Committee’s next scheduled meeting was to take place on December 2, 2004. Guyden planned to discuss her concerns with the Committee at that meeting, where she also hoped to present the outside auditor’s report.

Ten days before the meeting, however, Aetna terminated Guyden’s employment. After being terminated, Guyden requested to speak at the Audit Committee meeting about her concerns. Senior management denied that request. Guyden believes that Aetna fired her to prevent her from bringing attention to deficiencies in Aetna’s internal controls, and she points to management’s refusal to allow her to speak at the Committee meeting as evidence of its desire to prevent further discussion of her concerns.

II. Guyden’s Lawsuit Against Aetna

A. Guyden’s Complaint

Within ninety days of Aetna’s termination of her employment, Guyden filed an administrative complaint with the Secretary of Labor alleging that Aetna’s action had violated the SOX whistleblower protection provision, 18 U.S.C. § 1514A. Section 1514A prohibits public companies from “discharg[ing] ... an employee ... because of any lawful act done by the employee ... to provide information ... regarding any conduct which the employee reasonably believes constitutes a violation of [federal securities law], when the information or assistance is provided to ... a person with supervisory authority over the employee....” 18 U.S.C. § 1514A(a)(l)(C). An aggrieved employee may file an administrative complaint with the Secretary of Labor, and if the Secretary takes no action on the complaint within 180 days, the employee may bring an action in federal district court. Id. § 1514A(b)(l). When the Secretary did not act on Guyden’s administrative complaint within 180 days, she filed this action in the district court.

B. Aetna’s Motion to Dismiss

Shortly after Guyden filed her complaint, Aetna moved to dismiss the complaint and compel arbitration based on an arbitration agreement that Guyden had signed. In support, Aetna filed several documents reflecting Guyden’s agreement to arbitrate employment-related disputes. For example, Aetna filed Guyden’s signed application for employment, which stated that Guyden understood that if she were “offered employment [at Aetna], a condition of the offer and [her] acceptance [was] that [she] agree[d] to use Aetna’s mandatory/binding arbitration program rather than the courts to resolve employment-related legal disputes.” Similarly, the offer letter Aetna issued to Guyden stated that “[t]his offer and [Guyden’s] acceptance of that offer also are contingent upon [her] agreement to use the Company’s mandatory/binding arbitration program rather than the courts to resolve employment-related legal disputes.”

Guyden later signed other documents that further delineated the “mandatory/binding arbitration program” applicable to any employment-related disputes. On April 22, 2004, Guyden signed a stock incentive agreement that included a mandatory arbitration agreement (“the Agreement”). The signature page included a *381 statement that “Grantee has accepted the stock option award and agrees to be bound by all its terms and conditions including mandatory binding arbitration of employment related disputes.... ” Guyden does not challenge the existence of the arbitration agreement.

The Agreement stated that “all employment-related legal disputes between [Guy-den and Aetna] will be submitted to and resolved by binding arbitration.... ” The only employment-related disputes not included in this requirement were workers’ compensation claims, unemployment compensation claims, and Employment Retirement Income Security Act (“ERISA”) claims.

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544 F.3d 376, 28 I.E.R. Cas. (BNA) 289, 2008 CCH OSHD 32,970, 2008 U.S. App. LEXIS 20783, 91 Empl. Prac. Dec. (CCH) 43,337, 2008 WL 4426478, Counsel Stack Legal Research, https://law.counselstack.com/opinion/guyden-v-aetna-inc-ca2-2008.