Bergman v. Best Buy Company Inc. et al

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IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ILLINOIS
ALICA K. BERGMAN, 	)
)
Plaintiff, 	)
)
vs. 	) 	Case No. 25-cv-1318-DWD
)
BEST BUY COMPANY, INC., 	)
AND BEST BUY STORES, L.P.., 	)
)
Defendants. 	)
MEMORANDUM AND ORDER
DUGAN, District Judge:
Plaintiff Alica K. Bergman, a former employee of Best Buy Stores, L.P. (“BB
Stores”), alleges BB Stores and Best Buy Co., Inc. (“BB Co.”) (collectively “Defendants” or
“Best Buy”) 1 retaliated against her for reporting a workers’ compensation claim,
discriminated against her based on her age and gender, violated the Illinois Personnel
Records Review Act, and acted willfully and Wantonly. (Doc. 1-2). Now before the Court
is Defendants’ Motion to Dismiss or Stay the Case and Compel Arbitration (Doc. 7) and
Memorandum in Support (Doc. 8). Plaintiff filed a Memorandum in Opposition (Doc. 10),
to which Best Buy replied (Doc. 11). For the reasons explained below, the Court will grant
the motion to compel arbitration, deny the motion to dismiss, and stay the action.
1 BB Stores is an indirect subsidiary of BB Co. (Doc. 8-1 ¶ 2).
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I. 	PRELIMINARY MATTER – PERSONAL IDENTIFIERS
As a preliminary matter, Plaintiff’s request that Defendants be admonished for
allegedly disclosing “personal identifiers” is without merit. The exhibit at issue was filed
in connection with Defendants’ motion to dismiss or compel arbitration and consists of
Plaintiff’s own employment application paperwork, material Plaintiff placed at issue by
initiating this litigation. See, e.g., Baxter Int'l, Inc. v. Abbott Lab'ys, 297 F.3d 544, 546 (7th
Cir. 2002). The exhibit contains Plaintiff’s address, telephone numbers, email address, job
history, and income history, none of which are protected identifiers under F ED. R. C IV. P.
5.2 or SDIL Local Rule 5.1(c)(1). 2 The only category covered by Rule 5.2, social security
numbers, was properly limited to the last four digits, which the Rule expressly permits.
Because the filing complies with Rule 5.2 and the Local Rule, and contains no information
subject to mandatory redaction, there is no basis to admonish Defendants.
II. 	BACKGROUND
A. Application Process
To apply for jobs or respond to job offers at Best Buy, applicants must create a
unique ID and secure password to log into the online system. (Doc. 8-1 ¶ 5). Best Buy
maintains an arbitration policy (the “Arbitration Policy” or “Policy”) that applies to all
employees and job applicants. (Doc. 8-1 ¶ 6).
2 SDIL Local Rule 5.1(c)(1) provides that parties “shall refrain from including, or shall redact where
inclusion is necessary, personal identifiers…in accordance with Fed. R. Civ. P. 5.2…” Because the Local
Rule requires that parties refrain from including or redact “in accordance with” Rule 5.2, its scope is
confined to the narrow categories listed in that Rule, and does not extend to addresses, telephone numbers,
email addresses, job history, or income history.
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Since March 2016, the Arbitration Policy has been incorporated into Best Buy’s
electronic job application process. (Doc. 8-1 ¶ 7). All applicants, including current
employees applying for different positions, receive an electronic link to the full Policy,
which they can click to open and review. (Doc. 8-1 ¶ 7). During the application process,
applicants see the following notice:
(Id.). Applicants must then click an “I agree” button on the Acknowledgement and
Consent page to confirm their agreement to the Arbitration Policy before proceeding.
(Doc. 8-1 ¶ 9). An applicant cannot complete or submit a job application online without
clicking this “I agree” button. (Doc. 8-1 ¶¶ 7-9).
B. Plaintiff’s Employment with Best Buy
Plaintiff is a former Best Buy employee. (Doc. 8-1 ¶ 4). She worked for the company
from August 21, 2017, until her employment ended on May 21, 2025. (Doc. 8-1 ¶ 4). On
July 12, 2017, Plaintiff submitted an online application for the position of In-Home
Operations Specialist. (Doc. 8-1 ¶ 10). In the course of submitting her application, Plaintiff
completed the Acknowledgment and Consent page and confirmed her agreement to the
Arbitration Policy. (Doc. 8-1 ¶ 11).
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(Doc. 8-1, pg. 13).
(Doc. 8-1, pg. 20).
After 	submission, 	Best 	Buy 	sent 	an 	email 	confirming 	receipt 	of 	Plaintiff’s
application. The email stated that by submitting the application, she had agreed to the
Arbitration Policy and included an attached copy of the Policy for her review. (Doc. 8-1
¶ 12).
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(Doc. 8-1, pg. 21).
Plaintiff was offered the In-Home Operations Specialist position on or about
August 1, 2017. (Doc. 8-1 ¶ 13). Defendants contend that the official offer letter included
a copy of the Arbitration Policy and a separate document describing its terms. (Doc. 8-1
¶ 13). On at least ten additional occasions when she applied online for other Best Buy
positions, Plaintiff clicked “I agree” to the Policy to proceed with the application process.
(Doc. 8-1 ¶ 15). She clicked “I agree” to the Policy during the application process on the
following dates:
1. 	November 1, 2020
2. 	November 12, 2020 (two applications)
3. 	November 20, 2020
4. 	May 20, 2021
5. 	May 27, 2021
6. 	June 9, 2021
7. 	August 12, 2023
8. 	August 22, 2023
9. 	August 25, 2023
(Doc. 8-1 ¶ 15).
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Plaintiff does not dispute the application process as described by Best Buy,
including that the process required applicants to click “I Agree” to the Policy to proceed
to the next screen and to complete the application process. (Doc. 10-1 ¶ 5). However,
Plaintiff states that “I was never supplied with a copy of any agreement to arbitrate, a
copy of any Arbitration Policy, or any Employment Arbitration Rules of the AAA while
I was employed by any Defendant.” Id.
Plaintiff did not physically sign the Arbitration Agreement. Id. Additionally, she
never read the Arbitration Agreement and was not required to read the Arbitration
Agreement. Id.
C. Arbitration Agreement
The Arbitration Agreement provides, in relevant part, as follows:
Summary
(Doc. 8-1, pg. 5).
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Covered Claims
(Doc. 8-1, pg. 6).
(Doc. 8-1, pgs. 6-7)
Arbitrability Questions
(Doc. 8-1, pg. 11).
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D. Procedural History and Argument
Plaintiff filed this action in the Circuit Court of St. Clair County, Illinois, on May
22, 2025. (Doc. 1). In her Complaint, Plaintiff alleges that Defendants retaliated against
her for reporting a workers’ compensation claim, discriminated against her based on her
age and gender, violated the Illinois Personnel Records Review Act, and acted willfully
and wantonly. (Doc. 1-2). Defendants removed the action to this Court (Doc. 1) and
subsequently 	moved 	to 	compel 	arbitration 	or, 	in 	the 	alternative, 	to 	dismiss 	the
Complaint. (Doc. 7). Defendants contend that Plaintiff assented to a binding arbitration
agreement that covers all claims asserted in the Complaint and that the Court therefore
must compel arbitration and stay this action. (Doc. 7).
Plaintiff responds that no agreement to arbitrate was ever formed and that, even
if one was, it is unenforceable. (Doc. 10) She first challenges contract formation and
enforceability, arguing that she never physically signed an agreement, did not read and
was not required to read the Arbitration Agreement, did not receive a copy of it, and that
the Agreement is unenforceable due to lack of due process, unconscionability, fraud or
duress, and public policy concerns. Id. Plaintiff further contends that the Arbitration
Agreement is void and/or unenforceable under the Illinois Workplace Transparency Act
(“IWTA”), 820 Ill. Comp. Stat. 96/1-1 et seq. Id.
Defendants counter that a valid Arbitration Agreement was formed and that any
challenges to its enforceability are questions for the arbitrator, not the Court. (Doc. 8).
With respect to the IWTA, Defendants argue that the statute is inapplicable because
Plaintiff first assented to the Agreement in 2017, nearly two and a half years before the
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IWTA took effect on January 1, 2020, and the statute does not apply retroactively. Id.
Finally, Defendants argue that even if the IWTA were applicable, it is preempted by the
Federal Arbitration Act (“FAA”), which displaces state laws that prohibit outright the
arbitration of a particular type of claim or that operate in a manner that disfavors
arbitration. Id.
III. 	APPLICABLE LAW
A. Federal Arbitration Act
Defendant 	moves 	to compel 	arbitration under 	the Federal Arbitration 	Act
(“FAA”). The FAA mandates that courts enforce valid, written arbitration agreements.
Tinder v. Pinkerton Sec., 305 F.3d 728, 733 (7th Cir. 2002) (citing 9 U.S.C. § 2). This mandate
reflects a federal policy that favors arbitration and “places arbitration agreements on
equal footing with all other contracts.” Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S.
440, 443 (2006). Arbitration should be compelled under the FAA when “three elements
are present: (1) an enforceable written agreement to arbitrate, (2) a dispute within the
scope of the arbitration agreement, and (3) a refusal to arbitrate.” A.D. v. Credit One Bank,
N.A., 885 F.3d 1054, 1060 (7th Cir. 2018) (citing 9 U.S.C. §§ 3–4).
Courts must decide whether an agreement to arbitrate exists before compelling
arbitration. Janiga v. Questar Cap. Corp., 615 F.3d 735, 741–42 (7th Cir. 2010); accord K.F.C.
v. Snap Inc., 29 F.4th 835, 837 (7th Cir. 2022). In making that determination, courts apply
state contract law to decide whether a binding arbitration agreement was formed. Janiga,
615 F.3d at 742; Tinder v. Pinkerton Sec., 305 F.3d 728, 733 (7th Cir. 2002).
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Once the court concludes that the parties formed an agreement to arbitrate, it may
presumptively resolve challenges directed at the agreement’s validity, enforceability, and
scope. AT&T Techs., Inc. v. Commc’ns Workers of Am., 475 U.S. 643, 649 (1986); see also First
Options, 514 U.S. at 944–45. The parties, however, may agree to delegate those threshold
issues to the arbitrator rather than the court. Rent-A-Center, West, Inc. v. Jackson, 561 U.S.
63, 68–69 (2010).
For delegation to apply, there must be clear and unmistakable evidence that the
parties intended to arbitrate threshold questions of validity, enforceability, and scope.
First Options, 514 U.S. at 944. That evidence often appears in a written provision
expressing the parties’ intent to have the arbitrator decide such matters. See, e.g., Rent-A-
Center, 561 U.S. at 71–72 (discussing a written delegation provision); K.F.C., 29 F.4th at
837 (intent to delegate found in a “broad delegation clause”). Where the parties have
delegated these issues, the court “possesses no power to decide the arbitrability issue,”
whatever its view of the merits. Henry Schein, Inc. v. Archer & White Sales, Inc., 586 U.S. 63,
68 (2019).
Some issues, however, always remain within the court’s authority. Most notably,
the court must decide whether the parties formed a contract in the first place. K.F.C., 29
F.4th at 837 (“Even the most sweeping delegation cannot send the contract formation
issue to the arbitrator, because, until the court rules that a contract exists, there is simply
no agreement to arbitrate.”).
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The party seeking to compel arbitration bears the burden of establishing the
existence of an agreement to arbitrate. A.D., 885 F.3d at 1060. If that burden is met, the
party opposing arbitration must present countervailing evidence sufficient to meet the
standard required to oppose summary judgment. Tinder, 305 F.3d at 735. In other words,
the nonmoving party must submit evidence raising a genuine issue of material fact
concerning the existence of the agreement. Id. In reviewing the evidence, any “evidence
of the nonmovant is to be believed and all justifiable inferences are to be drawn in [her]
favor.” Id. The court may not make credibility determinations, choose between competing
inferences, or weigh conflicting evidence. Washington v. Haupert, 481 F.3d 543, 550 (7th
Cir. 2007); Abdullahi v. City of Madison, 423 F.3d 763, 773 (7th Cir. 2005).
If the court determines that issues are arbitrable, the FAA requires it to compel
arbitration and stay the litigation of those issues. Volkswagen of Am., Inc. v. Sud’s of Peoria,
Inc., 474 F.3d 966, 971 (7th Cir. 2007).
B. The Illinois Workplace Transparency Act
The IWTA seeks to “protect the interest of [the] State in ensuring all workplaces
are free of unlawful discrimination and harassment,” and declares certain types of
employment agreements unenforceable. 820 Ill. Comp. Stat. 96/1-5. As relevant here, the
Act states the following:
Any agreement, clause, covenant, or waiver that is a unilateral condition of
employment or continued employment and requires the employee or
prospective employee to waive, arbitrate, or otherwise diminish any
existing or future claim, right, or benefit related to an unlawful employment
practice to which the employee or prospective employee would otherwise
be entitled under any provision of State or federal law, is against public
policy, void to the extent it denies an employee or prospective employee a
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substantive or procedural right or remedy related to alleged unlawful
employment 	practices, 	and 	severable 	from 	an 	otherwise 	valid 	and
enforceable contract under this Act.
Id. 96/1-25(b).
C. FAA Preemption
In AT&T Mobility LLC v. Concepcion, the Supreme Court explained how to evaluate
whether the FAA preempts a state law by dividing such laws into two types. The first
consists of rules that “prohibit[ ] outright the arbitration of a particular type of claim.”
563 U.S. 333, 341 (2011). The second includes laws that are facially “generally applicable,”
but that may nevertheless be “applied in a fashion that disfavors arbitration.” Id. For this
second category, preemption depends on how the law operates in practice. Although the
inquiry is case specific, such laws are preempted when they “have a disproportionate
impact on arbitration or interfere with fundamental attributes of arbitration and thus
create a scheme inconsistent with the FAA.” Mortensen v. Bresnan Commc’ns, LLC, 722 F.3d
1151, 1159 (9th Cir. 2013) (cleaned up); see Concepcion, 563 U.S. at 341–44. By contrast,
when a state rule falls into the first category, the preemption analysis “is straightforward:
The conflicting rule is displaced.” Concepcion, 563 U.S. at 341.
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IV. 	DISCUSSION 3
A. Agreement to Arbitrate – Contract Formation
The Court begins with whether Plaintiff agreed to arbitrate in the first place.
Plaintiff does not dispute the mechanics of Defendants’ online application process, nor
does she dispute that she clicked the “I agree” button in August 2017, or on the
subsequent occasions when she applied for other positions beginning in November 2020.
She contends, however, that this did not bind her to a contract because (1) she did not
physically sign the arbitration agreement; (2) she never read the arbitration policy; (3) she
was not required to read it; (4) she was never supplied with a copy while employed; and
(5) when she requested her personnel file during the pendency of this case in Illinois state
court, Defendants did not produce a copy of the arbitration agreement, which she
characterizes as “curious.”
These assertions do not create a material dispute as to contract formation. Under
Illinois law, contract formation “requires only a manifestation of mutual assent on the
part of two or more persons.” Gupta v. Morgan Stanley Smith Barney, LLC, 934 F.3d 705,
711 (7th Cir. 2019) (citing Zabinsky v. Gelber Grp., Inc., 807 N.E.2d 666, 671 (Ill. Ct. App.
2004)). Whether mutual assent exists is evaluated under an “objective theory,” under
which “intent to manifest assent . . . is revealed by outward expressions such as words
and acts.” Sgouros v. TransUnion Corp., 817 F.3d 1029, 1034 (7th Cir. 2016). The parties
3 The parties do not dispute that Illinois law governs the Court's analysis. See Auto-Owners Ins. Co. v.
Websolv Computing, Inc., 580 F.3d 543, 547 (7th Cir. 2009) (“Courts do not worry about conflicts of laws
unless the parties disagree on which state's law applies”).
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need not “share the same subjective understanding as to the terms of the contract.”
Midland Hotel Corp. v. Reuben H. Donnelley Corp., 118 Ill. 2d 306, 515 N.E.2d 61, 65 (1987).
Illinois 	law 	also 	expressly 	recognizes 	electronic 	acceptance. 	The 	Uniform
Electronic Transactions Act defines an “electronic signature” as “an electronic sound,
symbol, or process attached to or logically associated with a record and executed or
adopted by a person with the intent to sign the record,” and provides that “[a] record or
signature shall not be denied legal effect or enforceability solely because it is in electronic
form.” 815 Ill. Comp. Stat. Ann. 333/2(a); 815 Ill. Comp. Stat. Ann. 333/7). Further, courts
frequently find that “clickwrap” agreements, 4 such as the agreements at issue here, are
sufficient to satisfy the acceptance requirement. See Sgouros v. TransUnion Corp., 817 F.3d
1029, 1033-34 (7th Cir. 2016) (An “electronic ‘click’ can suffice to signify the acceptance of
a contract,” and so courts have generally upheld clickwrap agreements provided “the
layout and language of the site give the user reasonable notice that a click will manifest
assent to an agreement.”).
Here, Defendants have produced evidence of Plaintiff’s initial and subsequent
application 	processes. 	In 	each 	instance, 	Plaintiff 	was 	required 	to 	complete 	an
“Acknowledgment and Consent” step. During that step, the screen stated:
Best Buy has an Arbitration Policy under which any disputes between any
applicant for employment or employee and Best Buy must be arbitrated on
an individual basis. The Policy is a required condition of your application
for employment, and if you are hired, of your employment at Best Buy.
4 Courts in Illinois distinguish “clickwrap” from “browsewrap” agreements, the key difference being
that clickwrap agreements require “a website user to expressly assent to the website's terms of use
by clicking on an ‘I agree’ box after being presented with terms, before continuing” with the
transaction. Ambrosius v. Chicago Athletic Clubs, LLC, 203 N.E.3d 239, 250 (Ill. App. Ct. 2021).
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(Doc. 8-1 ¶ 7; Doc. 8-1, pgs. 13, 20, 31, 35, 39, 43, 47, 55).
The screen then directed Plaintiff to “[r]eview and agree to the Policy (with a link
available to view the detailed policy) to continue with your application.” Plaintiff
proceeded past this screen and clicked “I agree.” (Doc. 8-1 ¶¶ 7-11). Thereafter, Best Buy
transmitted a confirmation email stating that by submitting her application Plaintiff had
agreed to the Arbitration Policy. (Doc. 8-1, pg. 22). Defendants’ evidence further shows
that the same process occurred on multiple occasions between November 2020 and
August 25, 2023, when Plaintiff applied for new positions and again clicked to accept the
Arbitration Policy. (Doc. 8-1 ¶ 15).
Plaintiff does not dispute any of these facts. She does not deny that the arbitration
disclosure appeared on her screen, that a link to the policy was available, or that she
clicked “I agree” to proceed. Instead, she asserts that she never read the policy, never
physically signed it, and was not later provided a copy. Those contentions do not defeat
contract formation. “An electronic click can suffice to signify the acceptance of a
contract,” Sgouros, 817 F.3d at 1034, and a party may be bound even if she chose not to
read the terms. Hill v. Gateway, Inc., 105 F.3d 1147, 1148 (7th Cir. 1997); Novitsky v. Am.
Consulting Eng’rs, LLC, 196 F.3d 699, 702 (7th Cir. 1999); All Am. Roofing, Inc. v. Zurich Am.
Ins. Co., 404 Ill. App. 3d 438, 447–48 (2010).
Nor does the absence of the arbitration agreement from Plaintiff’s personnel file
request create a factual dispute about assent. Contract formation turns on the objective
acts at the time of agreement, not on later document retention practices or whether
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Plaintiff subjectively recalls receiving a copy. Plaintiff does not deny that she clicked
through the acknowledgment screen or that the arbitration disclosure and link appeared
before she could proceed. Those undisputed facts are sufficient to establish assent.
The Court finds that a reasonable person in Plaintiff’s position would have
understood that clicking “I agree” manifested assent to the Arbitration Policy, and that
Plaintiff electronically accepted the agreement in August 2017 and on several occasions
thereafter. Sgouros, 817 F.3d at 1034–35.
Plaintiff next argues that, even if a contract was formed, it is not enforceable
because she lacked bargaining power, and the agreement was offered on a take-it-or-
leave-it basis. Questions of enforceability, however, have been expressly delegated to the
arbitrator. The delegation clause provides that:
Any dispute as to arbitrability, including disputes about this Policy’s
enforceability, unconscionability, validity and applicability to a particular
Claim must be resolved by the arbitrator in arbitration and not by the court.
(Doc. 8-1, p. 10). Such clauses require threshold enforceability challenges to be resolved
by the arbitrator. See Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 445–46 (2006).
In summary, the Court concludes that Plaintiff formed an agreement to arbitrate
with 	Best 	Buy. 	Whether 	that 	agreement 	can 	be 	avoided 	on 	grounds 	such 	as
unconscionability or public policy must be decided by the arbitrator, that is unless
Plaintiff’s IWTA arguments negate contract formation, which the Court addresses next.
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B. The IWTA Does Not Negate Contract Formation
As a threshold matter, the Court need not resolve Defendants’ argument that
IWTA is categorically inapplicable because the arbitration agreement was originally
executed before the statute’s effective date. The record reflects that Plaintiff was required
to re-assent to the arbitration agreement each time she applied for and accepted a new
position or promotion, including on multiple occasions after the IWTA became law.
Under Illinois law, such re-assent may be understood either as an amendment to an
ongoing employment relationship or as the formation of a new contract supported by
new consideration. 5 The Court need not decide which characterization controls, because
even assuming the IWTA applies to the operative agreement, Plaintiff’s argument still
fails. The IWTA does not negate contract formation; it supplies, at most, a defense to
enforcement that must be decided by the arbitrator.
Plaintiff’s position rests on the premise that the IWTA renders the arbitration
agreement void ab initio and therefore nonexistent. That is not what the statute provides.
The IWTA states that certain employment provisions are “against public policy and void
and unenforceable.” 820 ILCS 96/1-25. But Illinois law draws a critical distinction
5 Illinois law does not treat every re-assent or contractual amendment as the formation of a new contract.
Instead, courts examine whether the parties’ rights and obligations were materially altered. Nebel, Inc. v.
Mid-City Nat’l Bank of Chi., 329 Ill. App. 3d 957, 965-67, 769 N.E.2d 45, 51-53 (2002). Where modifications
are “routine” or do not significantly change the parties’ rights and duties, they may constitute only a
reaffirmation or continuation of the existing agreement. Id. (discussing McKay Nissan, Ltd. V. Nissan
Motor Corp. in U.S.A., 764 F. Supp. 1318 (N.D. Ill. 1991)). By contrast, where the parties undertake
materially new obligations or significantly alter existing ones, Illinois law recognizes that a new agreement
or novation may arise. Nebel, 329 Ill. App. 3d at 966-67. The Court need not determine whether Plaintiff’s
subsequent assents to the arbitration agreement constitute a new obligation “entered into” after enactment
of the IWTA. Even assuming the operative agreement is subject to the IWTA, Plaintiff’s challenge goes to
enforceability and not contract formation. Therefore, it must be decided by the arbitrator.
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between contracts that are void ab initio and those that are merely voidable. A voidable
agreement “may be ratified,” and therefore is treated as a defense to enforcement rather
than an obstacle to contract formation. K.F.C. v. Snap Inc., 29 F.4th 835, 838 (7th Cir. 2022).
Where state law permits the contract to exist unless and until it is avoided, the defect
concerns the agreement’s validity; not its existence. Id. at 839.
That is the situation here. The IWTA does not declare that no contract can be
formed, nor does it deprive employees of the legal capacity to assent. Rather, it reflects a
legislative judgment that certain waivers should not be enforced as a matter of public
policy. As in K.F.C., where a minor’s age and public policy objections were held to be
defenses to enforcement, not failures of formation, Plaintiff’s reliance on the IWTA
challenges the agreement’s validity, not its existence. Under controlling Supreme Court
and Seventh Circuit authority, such challenges must be resolved by the arbitrator. Buckeye
Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 449 (2006); K.F.C. v. Snap Inc., 29 F.4th 835,
838-39 (7th Cir. 2022).
C. Even If the IWTA Were Construed to Bar Formation, It Would Be Preempted
Even assuming arguendo that the IWTA could be read to invalidate arbitration
agreements at inception, the statute would be preempted by the FAA. Section 2 of the
FAA provides that arbitration agreements are “valid, irrevocable, and enforceable, save
upon such grounds as exist at law or in equity for the revocation of any contract.” 9 U.S.C.
§ 2. By its terms and as interpreted by the Supreme Court, the FAA reflects a national
policy favoring arbitration and “foreclose[s] state legislative attempts to undercut the
enforceability of arbitration agreements.” Southland Corp. v. Keating, 465 U.S. 1, 16 (1984).
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Accordingly, state laws may invalidate arbitration agreements only to the extent they rely
on generally applicable contract defenses, such as fraud, duress, or unconscionability.
AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011).
When a state law purports to “prohibit[] outright the arbitration of a particular
type of claim,” it conflicts with the FAA and is displaced. Concepcion, 563 U.S. at 341; see
also Marmet Health Care Ctr., Inc. v. Brown, 565 U.S. 530, 533 (2012) (state law prohibiting
agreements to arbitrate certain claims preempted by the FAA). By contrast, generally
applicable state laws that apply in a way that disfavors arbitration require a case specific
inquiry to determine whether “they have a ‘disproportionate impact’ on arbitration or
‘interfere[ ] with fundamental attributes of arbitration and thus create [ ] a scheme
inconsistent with the FAA.’” Mortensen v. Bresnan Commc’ns, LLC, 722 F.3d 1151, 1159 (9th
Cir. 2013) quoting Concepcion, 563 U.S. at 341–44.
The IWTA falls firmly within the first category. It prohibits arbitration of a defined
class of claims, namely, certain workplace misconduct claims. 820 ILCS 96/1-25(b). Laws
that categorically prevent arbitration of particular claims are the type of conflicting state
rules that the Supreme Court has held are displaced by the FAA. Concepcion, 563 U.S. at
341; Marmet Health Care Ctr., 565 U.S. at 532–33.
As one recent Northern District of Illinois decision illustrates, the IWTA’s
language, 	by 	prohibiting 	“[a]ny 	[unilateral] 	agreement…[to] 	arbitrate” 	workplace
misconduct claims, constitutes an outright ban on a particular category of claims, and is
therefore preempted. Jennings v. Ed Napleton Elmhurst Imports Inc., No. 1:23-CV-14099,
2025 WL 461433, at *3 (N.D. Ill. Feb. 11, 2025) (interpreting 820 ILCS 96/1-25(b)); cf.
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Marmet Health Care Ctr., 565 U.S. at 532–33 (West Virginia law banning arbitration of
personal injury or wrongful death claims preempted).
Thus, even if the IWTA were construed to bar the formation of arbitration
agreements, it would be preempted by the FAA and cannot serve as a basis to resist
enforcement. The FAA’s displacement of conflicting state law is categorical where, as
here, the statute prohibits arbitration of a defined class of claims. Concepcion, 563 U.S. at
341; Marmet Health Care Ctr., 565 U.S. at 532–33.
D. 	Scope of Arbitration and Refusal to Arbitrate
Once a valid agreement to arbitrate is established, the Court must consider
whether the dispute falls within the scope of the arbitration agreement and whether the
opposing party has refused to arbitrate. Wallrich v. Samsung Elecs. Am., Inc., 106 F.4th 609,
168 (7th Cir. 2024). Plaintiff does not dispute that these factors are met here, thereby
waiving any argument to the contrary. See, e.g., Yang v. Fedex Freight, Inc., No. 15 CV 1037,
2016 WL 3444219 (N.D. Ill. June 23, 2016) (failure to respond to an argument constitutes
waiver).
Further, the Policy defines “Covered Claims” broadly as including “past, present
or future Claims between an Employee/former Employees or applicant and Best Buy,
that 	arise 	out 	of 	or 	relate 	in 	anyway 	to…employment 	and/or 	termination 	of
employment.” Covered claims expressly include “tort claims, wrongful discharge claims,
discrimination, harassment, and retaliation claims, and claims under any federal, state or
local statute, regulation, wage order or ordinance.” (Doc. 8-1, pgs. 6-7). The claims at issue
here clearly belong within this definition.
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As the Seventh Circuit has held, “[o]nce the court finds that there is a valid
agreement to arbitrate, the burden shifts to the party opposing arbitration to show that
the dispute is not covered by the agreement.” Wilcosky v. Amazon.com, Inc., 517 F. Supp.
3d 751, 767 (N.D. Ill. 2021). Plaintiff has not met this burden and has not argued that any
of her claims fall outside the scope of the agreement. For its part, Best Buy has invoked
the applicable terms and conditions, demonstrating that the claims are covered and that
Plaintiff has refused to arbitrate. Under these circumstances, the Court must compel
arbitration and stay the litigation.
V. 	DISMISS OR STAY
The final issue is whether the case should be dismissed or stayed after compelling
arbitration. Citing to 9 U.S.C. §§ 3 and 4, Defendants ask the Court to “enforce the Parties’
mutual agreement to arbitrate claims, dismiss this case, or in the alternative stay the
case…” (Doc. 7). In Smith v. Spizzirri, 601 U.S. 472 (2024), the Supreme Court clarified that
§ 3 of the FAA removes a court’s discretion to dismiss once a stay has been requested.
The Seventh Circuit has interpreted Spizzirri to mean that a district court must issue a
stay only when one of the parties has requested one; otherwise, the court retains
discretion to dismiss. Nat’l Cas. Co. v. Cont’l Ins. Co., 121 F.4 th 1151 (7th Cir. 2024). The
Seventh Circuit’s recent decision in Retzios v. Epic Systems Corp, further indicates that,
even when a stay is requested in the alternative, dismissal is not permitted. In Retzios, the
defendant moved to compel arbitration and asked the court to “either dismiss or stay”
the action. 2024 WL 5356563, at *1 (N.D. Ill. Mar. 26, 2024), aff’d, 126 F.4 th 1282 (7th Cir.
2025). After the district court compelled arbitration and dismissed the case. On Appeal,
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although the Seventh affirmed the arbitration decision, it admonished the district court
for dismissing the case, stating as follows:
The district judge should not have dismissed this suit. The Federal
Arbitration Act calls for a suit referred to arbitration to be stayed rather than
dismissed, when a party requests a stay (as Epic did). 9 U.S.C. § 3; Smith v.
Spizzirri, 601 U.S. 472, 144 S.Ct. 1173, 218 L.Ed.2d 494 (2024); Halim v. Great
Gatsby's Auction Gallery, Inc., 516 F.3d 557, 561 (7th Cir. 2008). Had the court
entered a stay, that order would not have been appealable. 9 U.S.C. §
16(b)(1). But appellate jurisdiction depends on what the district court did,
rather than what it should have done, so we must proceed.
Retzios v. Epic Sys. Corp., 126 F.4th 1282, 1285 (7th Cir. 2025). Other Appellate Courts
addressing the same procedural posture have reached the same conclusion. Post-Spizzirri,
the Ninth Circuit held that a motion seeking to “dismiss or, in the alternative, stay”
constitutes a § 3 stay request requiring a mandatory stay. Herrera v. Cathay Pac. Airways
Ltd., 104 F.4 th 702, 711 (9 th Cir. 2024). Likewise, the Third Circuit held that where
defendants moved to “dismiss, or in the alternative to stay,” a stay is required if the
claims are arbitrable. Cornelius v. CVS Pharmacy, Inc., 133 F.4 th 240, 245 (3d Cir. 2025).
Together, these authorities establish that a motion to compel arbitration coupled with an
alternative request for a stay triggers § 3’s mandatory stay requirement and forecloses
dismissal.
VI. 	CONCLUSION
For 	these 	reasons, 	Defendants’ 	Motion 	to 	Compel 	Arbitration 	(Doc. 	7) 	is
GRANTED. 	All 	proceedings 	in 	this 	case 	are 	STAYED, 	and 	all 	deadlines 	are
TERMINATED. Defendants’ Motion to Dismiss (Doc. 7) is DENIED.
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The parties are DIRECTED to file a status report advising the Court of the status
of the arbitration proceeding on or before August 3, 2026, and every February and August
thereafter until the arbitration is complete, and to file a final status report within 30 days
of the completion of the arbitration.
SO ORDERED.
Dated: February 3, 2026
/s/ David W. Dugan
_____________________________
DAVID W. DUGAN
United States District Judge
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