People of a certain age—say, Senior Lawyers Division age—may remember a Steve Martin routine from the 70s. Resplendent in a white suit and using his best TV pitchman voice, Steve promised to tell you, the audience member, how to be a millionaire and never pay taxes!
After a long set-up, he delivered two punch lines. How to be a millionaire? First, get a million dollars.
How to avoid paying any taxes? When the IRS calls, say two simple words: I forgot.
(OK, it was funnier when Steve did it.)
As laughable as the I forgot defense may sound, three California plaintiffs relied on a close variant—the I don’t recall defense--in a lawsuit against their former employer. What’s more, the trial court thought enough of the defense to accept it.
Leroy Iyere, Phillip Derbigny, and Michael Worlow worked at Wise Auto Group’s Infiniti dealership in California. When they were fired, they jointly sued Wise, asserting 25 causes of action, including discrimination, harassment, retaliation, breach of contract, and wrongful termination.
Wise responded with a motion to compel arbitration. In support, Wise submitted a mountain of documents, including (a) three compensation agreements, (b) three employee agreements, and (c) three employment applications.
All the documents called for binding arbitration of all issues and disputes. For example, Leroy’s and Mike’s arbitration agreements stated that
any claim, dispute and/or controversy arising from, or relating in any way to, Employee’s employment relationship … with the Company … which would otherwise be brought in court … shall be submitted to, and resolved through, final and binding arbitration ….
The wording of Phil’s agreement differed slightly but not materially.
All the agreements bore what looked for all the world like the handwritten and hand-dated signatures of Leroy, Phil, and Mike. Included with Wise’s motion was a declaration of the company’s HR director and custodian of personnel records, authenticating the documents.