Electronic Signature Fail, Unique ID and Pin Codes are a Must

Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541

Marinidence Opco, LLC tried to enforce an arbitration agreement against Bannister, an employee of Marinidence. Marinidence, the defendant employer, moved to compel arbitration against Bannister, the plaintiff, by presenting evidence that during employee onboarding, an electronic signature was placed on the arbitration agreement by the same party that entered the Plaintiff's information into the Defendant's computer system, using a "Client ID" and pin code. In addition, the Defendant also submitted testimony from an HR employee that the Plaintiff was the one who filled out the information and submitted the electronic signature. However, the Plaintiff submitted contradictory evidence, stating that there were no employee-specific user names or passwords required to access the onboarding portal, and that she was never provided with any documents, and never saw the arbitration agreement. The Plaintiff stated that she actually never entered her own information into the computer system, rather an HR employee asked her questions and filled out the form for herself and other employees. Bannister, the Plaintiff, also submitted evidence that the Client ID and pin number were the same for all employees.

The trial court denied the motion to compel and found that Marinidence, the Defendant, failed to authenticate the electronic signature, and the Court of Appeal agreed. The Court held that under Civil Code § 1633.9, which is part of the California Uniform Electronic Transaction Act, an electronic signature can be authenticated by any evidence sufficient to show that the signature was the act of the person who it was attributed to. This includes evidence that a unique username and password, only known to that person, was required to submit the signature. In this case, Marinidence never provided employees with unique log-in credentials to access the onboarding portal, and because of that, the HR employee could have entered others' information themselves. Substantial evidence supported the trial court's factual finding that the Defendant failed to prove authentication, and the Court of Appeal was not in a position to disrupt this determination.

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