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Monday, November 07, 2011

Herman Cain And The Hooters Girl: His Lobbying Group Backed Effort to Gut Nation's Sexual Harassment Laws

Cain Camp Sweating Out Sexual Harassment Charges
CINCINNATI (TDB) -- Herman Cain's presidential campaign is scrambling to stay on point amid a flurry of sexual harassment claims that include today's allegation of groping a woman under her dress.  Also daunting:  Evidence that he supported legal maneuvers to circumvent laws to protect females from workplace predators.  Cain was CEO of the National Restaurant Association when it intervened in a landmark lawsuit defending Hooters' system of arbitrating sexual harassment claims.  But the Hooters system was so rigged against women that a board member of the American Arbitration Association likened it to a kangaroo court, and judges ruled it was warped.  Lewis Maltby, the AAA board member, said in court testimony, "This is without a doubt the most unfair arbitration program I have ever encountered."  A federal appeals court in Richmond, Va., agreed and ruled that Hooters had "set up a dispute resolution system process utterly lacking in the rudiments of even-handedness . . ."  Yet Cain was chief executive officer of the National Restaurant Association when it filed a friend of the court brief supporting Hooters.  Apparently, it saw nothing wrong with trampling womens' rights.

The lawsuit started in the mid-1990s when Annette R. Phillips, a bartender at a Hooters in Myrtle Beach, quit and complained the brother of the owner grabbed her ass and slapped her buttocks.  News reports at the time also said a  manager had exposed himself to her.  She was told to forget about it. Eventually, it escalated to a federal Title VII lawsuit over sex harassment and whether the restaurant chain discriminated, retaliated, or did Phillips wrong. Hooters said she had twice signed a deal consenting to arbitrate any claims -- employees had to sign to be eligible for raises, transfers and promotions. A federal appeals court said the predispute agreement was basically a joke.

The 4th Circuit U.S. Court of Appeals in Richmond said the rules Hooters set up in 1996 gave it absolute control over any three-person arbitration panel set up to hear a sexual harassment case.  In other words, sexually harassed women couldn't take their cases to court, and they couldn't get fair hearings before the company's panels.  "Under the rules, Hooters is free to devise lists of partial [biased] arbitrators who have existing relationships, financial or familial. with Hooters and its management. In fact, the rules do not even prohibit Hooters from placing its managers themselves on the list. Further, nothing in the rules restricts Hooters from punishing arbitrators who rule against the company by removing them from the list. Give the unrestricted control that one party (Hooters) has over the panel, the selection of an impartial decision maker would be a surprising result. Nor is fairness to be found when the proceedings are begun." Phillips won in the appeals court and you can read the decision against Hooters by clicking here.   What's truly amazing is that many experts saw that the Hooters panels were unfair, something that Cain's National Restaurant Association either chose to ignore or wanted to impose on women who had been harassed.  During the court proceedings, George Friedman, a senior vice president of the American Arbitration Association, testified that "the system established by the Hooters rules so deviated from minimum due process standards that the Association would refuse to arbitrate under those rules."  But Cain's group was backing them.  Bottom line: The National Restaurant Association, with Cain as CEO, backed a sham system for evaluating sexual harassment claims.  It was stacked against women.


  1. Good points, though I would suggest that filing an amicus brief hardly qualifies as "intervention."

    Basically, the court:
    - Said that "We affirm the district court's refusal to compel arbitration."
    - had the case "remanded for further proceedings consistent with this opinion."

    So it went to "normal" civil litigation. What happened then? Or does anyone know?

    Also, reading the CNN link re the woman's original filing, there may be a different reason why the National Restaurant Association filed the amicus brief:

    "the lawsuit alleges that Hooters put its female employees at risk of sexual harassment through its uniforms it required them to wear and the marketing of its restaurants."

    The only "remedy" for that is to change the uniforms to make them absolutely incapable of provoking sexual harassment and never to have the smiling face of an attractive female in an ad. I suppose Catholic school nuns' habits might do the trick, but then why have the restaurant? And how many other eateries have the help in uniforms which could be seen as conceivably leading to harassment by the occasional twisted nutjob customer or (sadly) manager? Or, how many women are sufficiently attractive that not even a nun's outfit would prevent occasional harrassment?

    It seems like this would have been at least as germane to the National Restaurant Association as the matter of arbitration (i.e., "if you let this stand without commenting on the uniform issue, future courts will assume that uniforms in and of themselves can be seen as causes of harassment"). I've tried to find the amicus brief and haven't.

    Tom Blumer

  2. Tom, the 4th Circuit opinion came from an interlocutory appeal about the arbitration system designed by Hooters. That system was wholly one-sided as to present a stacked deck favoring the company (as the court of appeals noted). I don't know if she litigated over the clothing, not part of this appeal. She worked at Hooters for several years; seems like the clothing was not central to the harassment she claimed. The National Restaurant Association probably took no position on such specific facts, but clearly did take a position about matters raised in the appeal. Hooters was the plaintiff and tried to enforce its arbitration proceeding. It did not succeed here.

    I think you are quite right to question my use of the word intervene. It would probably have been better to say that the National Restaurant Association asked for leave of the court to file a brief in support of Hooters legal position. And the leave was granted, as you can see. By the way, this case appears to be cited a good bit, and I haven't found anything indicating it was overturned or set aside.

    I have heard, but haven't confirmed any data, that the restaurant industry generates about 4,000 sexual harassment claims per year. I do not know if that is out of line, or in line with stats for other industries.

    As for Herman Cain, I have no clue what the future holds for his campaign. I imagine it would be over in an instant if it turns out he coached football at Penn State. However, I do sense that he will not recover as the four women make their sides of the story known. On that, time will tell . . .

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