Roa v. Hermes Law

At a glance

Parties

Silvia Diaz-Roa (Plaintiff-Appellee) v. Hermes Law, P.C., Syzygy Legal Tech, Inc. (doing business as ClaimDeck), Dwayne Hermes and Andrea Hermes (Defendants-Appellants)

Case no.

No. 24-3223-cv (2d Cir.)

Court

United States Court of Appeals for the Second Circuit

Tribunal

Circuit Judges Walker, Bianco and Pérez; opinion by Joseph F. Bianco, Circuit Judge

Treaty

Pre-dispute employment arbitration agreement signed in February 2018; Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFAA), 9 U.S.C. §§ 401–02

Underlying award(s)

None. The appeal is from the district court's denial of a motion to compel arbitration: Diaz-Roa v. Hermes L., P.C., 757 F. Supp. 3d 498 (S.D.N.Y. 2024).

Sector

Employment; legal services; legal technology

Outcome

Affirmed and remanded (30 September 2026). When the EFAA is properly invoked, it invalidates a pre-dispute arbitration agreement as to the entire lawsuit, not only the sexual harassment claims.

Amount

The plaintiff's vested stock options, about 10% of ClaimDeck's shares, had an estimated value exceeding $1 million.

The dispute

Silvia Diaz-Roa worked for the law firm Hermes Law from 2017 and later for its related legal-tech company ClaimDeck, where she became Head of Product and Chief Operating Officer. In February 2018 she signed an agreement to arbitrate her claims against Hermes Law. She alleged that she was terminated on 9 February 2024, said to be for cause, to stop her from exercising fully vested stock options, and that she had been sexually harassed throughout her employment. She sued in the Southern District of New York for sexual harassment under the New York City and New York State Human Rights Laws and for several non-harassment claims, of which only conversion survived the motion to dismiss. The defendants argued that the EFAA's word "case" means an individual claim, so the conversion claim had to be severed and sent to arbitration.

Key holdings

1. The word "case" in 9 U.S.C. § 402(a) plainly means the lawsuit as a whole, not an individual claim. When a plaintiff properly invokes the EFAA, the pre-dispute arbitration agreement is invalid as to all claims in the lawsuit, including non-harassment claims. pp. 13–16
2. Congress used "claim" elsewhere in the EFAA. Under the meaningful-variation canon, the choice of "case" in § 402(a) signals a different, broader meaning. p. 15
3. This reading does not make "relates to" superfluous. The phrase ties the filed case to the alleged harassment dispute. It is the case, not each claim, that must relate to the sexual harassment dispute. The scope of a case is limited by the joinder rules. pp. 21–25
4. The Court rejected the defendants' other arguments: the Article III meaning of "case," the FAA policy favouring arbitration (which a contrary congressional command can override), and legislative history. Because the text is unambiguous, legislative history was not needed. The magistrate judge's split approach in Mera v. SA Hospitality Group is an outlier and was later reversed. pp. 19–27
5. The defendants did not contest that Diaz-Roa had properly invoked the EFAA. Her whole lawsuit, including the remaining conversion claim, therefore stays in court, and the motion to compel arbitration was correctly denied in its entirety. p. 28
6. The Court left several questions open: whether the Bell v. Hood nonfrivolous standard or the Twombly/Iqbal plausibility standard governs invocation of the EFAA (the defendants forfeited the point); how the EFAA applies to class or collective actions and multi-plaintiff cases; and the alternative ground that the defendants waived arbitration by suing. p. 9 n.3; p. 24 n.12; p. 28 n.14

Procedural history

1. February 2018Diaz-Roa signs an arbitration agreement with Hermes Law.
2. 14 March 2024Hermes Law and ClaimDeck file a declaratory judgment action in the Northern District of Texas. That case is later stayed.
3. 20 March 2024Diaz-Roa files suit in the Southern District of New York.
4. 17 July 2024The defendants move to compel arbitration, to dismiss, and/or to transfer the case.
5. 1 November 2024The district court stays the arbitration proceeding that Hermes Law and ClaimDeck had filed against Diaz-Roa.
6. 21 November 2024The district court denies the motion to compel arbitration and the motion to transfer, and grants the motion to dismiss in part. The harassment claims and the conversion claim survive.
7. 16 October 2025Argument before the Second Circuit.
8. 30 September 2026Second Circuit affirms and remands.

Tribunal, counsel and experts

Decided by

• Joseph F. Bianco Judge, United States Court of Appeals for the Second Circuit (authored the opinion)

For the claimant

Wigdor LLP

For the respondent

Orrick, Herrington & Sutcliffe · Lewis Brisbois Bisgaard & Smith LLP

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Keywords

• EFAA
• 9 U.S.C. § 402
• sexual harassment dispute
• motion to compel arbitration
• pre-dispute arbitration agreement
• case versus claim
• relates to
• employment arbitration
• Federal Arbitration Act
• ClaimDeck
• stock options
• conversion
• meaningful-variation canon
• statutory interpretation
• Bruce v. Adams & Reese
• Mera v. SA Hospitality Group
• NYCHRL

Summary generated with AI from the published documents — refer to the award for the authoritative text.