Robinhood Pushes Engineer’s ‘Toxic’ Sexism Suit to Arbitration

(Bloomberg) — Robinhood Markets Inc. is poised to succeed in pushing a female former engineer’s claims about a “toxic culture of gender bias” at the company out of open court and into private arbitration.

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A San Francisco judge issued a tentative ruling requiring the ex-employee to arbitrate her claims of sex discrimination, harassment and retaliation after the brokerage argued that she gave up the right to sue in a standard provision in her contract.

Ayse Naz Erkan claims that after she was hailed as a “superhero” for helping rescue Robinhood from a meltdown during the “meme-stock” trading frenzy of 2021, she was passed over for a promotion and punished for complaining that her department was male-dominated. Ultimately she was fired the day she returned from a trip to India, where she went to care for her dying mother, according to her complaint.

She sued the company and her former supervisor in June, seeking unspecified monetary damages and a court order barring further discrimination at Robinhood.

Erkan’s lawyers said the misconduct she alleged at the company “should be adjudicated in the full light of day.” They argued she should be allowed to proceed in court under the federal “Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021” that took effect three months before she sued.

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The company countered that the federal statute was “wholly inapplicable” because the dispute pre-dates the law and because the measure is aimed at harassment involving “sexually inappropriate behavior, not claims of harassment based solely on gender.”

San Francisco Superior Court Judge Richard Ulmer sided in his tentative ruling with Robinhood without detailing his reasoning on the public docket. Erkan’s lawyers could request a hearing Monday to contest the ruling.

A sharp downturn in trading activity has triggered a sweeping overhaul to rein in expenses at Menlo Park, California-based Robinhood, including job cuts and office closures. The stock has tumbled 44% this year.

Erkan’s lawyers and Robinhood didn’t respond to requests for comment.

The case is Erkan v. Robinhood Markets Inc, CGC22600149, California Superior Court (San Francisco).