Montanus v. Columbia Management Investment Advisers

Background

Kari Montanus sued her employer, Columbia Management Investment Advisers, LLC, doing business as Columbia Threadneedle Investments. She alleged six claims of gender discrimination and retaliation under Title VII of the Civil Rights Act of 1964, the New York State Human Rights Law, and the New York City Human Rights Law.

Montanus had worked for Columbia since 2003 and most recently served as a portfolio manager. Her complaint alleged that Richard Rosen, a coworker who became her supervisor, made repeated sexist and sexual remarks, threatened her job, physically pushed her out of his office in 2014, and engaged in other hostile conduct. She also alleged that Columbia employees and supervisors knew about or dismissed the conduct, that she repeatedly complained, and that she was moved away from a more prestigious fund in 2018. The complaint further alleged later discriminatory treatment, including her being passed over for a lead position in 2023 and retaliation for opposing discrimination.

Motion to compel arbitration

Columbia moved to compel arbitration under the Federal Arbitration Act. Montanus did not dispute that she had signed a valid arbitration agreement or that the agreement ordinarily covered her claims. The agreement made arbitration the required and exclusive forum for employment-related legal disputes between Ameriprise Financial and its current or former employees, including employment-discrimination claims.

Montanus relied on the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act. That law creates an exception to predispute arbitration agreements for a dispute involving alleged sexual harassment or sexual assault, at the election of the person making the allegation. The court, rather than an arbitrator, decides whether the exception applies. The court explained that the law applies only to disputes accruing on or after March 3, 2022, and does not apply retroactively.

Court’s analysis

The court found that the complaint plausibly alleged sexual harassment before March 3, 2022, particularly through allegations of sexualized remarks and threatening conduct between 2003 and 2018. But the court found no similar sexualized conduct after 2018.

The complaint did allege events after March 3, 2022, including Rosen’s refusal to acknowledge Montanus at a meeting, his departures from meetings when she spoke, comments made near her, statements reflecting gender-based attitudes, and Columbia’s decision to promote another employee over her in 2023. The court held that these later events were different in character from the earlier sexualized conduct and were separated from it by about four years. They therefore could not plausibly be treated as part of the same continuing sexual-harassment practice.

The court also held that the federal exception covers sexual-harassment or sexual-assault disputes, not gender-discrimination claims merely because they involve gender. The court concluded that the later allegations concerned unequal treatment based on gender rather than continuing harassment of a sexual nature. It held that the New York City law’s more liberal standards did not change this result.

The court separately examined the arbitration agreement even though Montanus did not dispute its validity. It found that the agreement was supported by the parties’ mutual promises to arbitrate, that no other ground for invalidating it had been asserted, and that Montanus’s claims fell within its broad employment-related scope.

Disposition

Judge Paul A. Engelmayer granted Columbia’s motion to compel arbitration. The court stayed the action pending the outcome of arbitration, directed the Clerk of Court to terminate the motion at docket 8, and ordered the parties to submit a joint status letter every 90 days reporting on the arbitration proceedings.