In this case, Doctor Espejo sued Kaiser for wrongful termination. The facts aren't important. At the beginning of employment, Kaiser sent the doctor an email containing electronic links to his offer letter, the dispute resolution procedures (arbitration agreement), "rules and regulations," and a benefits handbook. He accepted his offer and the other materials via an electronic signature that he applied after clicking the links, signing in and following procedures.
The issue that lawyers have to deal with, dear HR and company management, is how to prove that these things happened in litigation. And that problem came up when Kaiser tried to compel Dr. Espejo to arbitrate.
The trial court rejected Kaiser's attempt to prove that Dr. Espejo signed his arbitration agreement. But the trial court did so because it refused to rely on a declaration that Kaiser submitted after Kaiser had filed its initial Petition to Compel Arbitration. (Kaiser submitted the additional declaration in response to a new court decision that had come down, trying to satisfy its evidentiary burden.) The Court of Appeal decided the trial court should have accepted Kaiser's declaration.
With that out of the way, the Court of Appeal made two significant rulings. One applies in the context of compelling arbitration. But one is more generally applicable to proving that electronically signed documents are "authentic" and admissible evidence.
First, the Court of Appeal decided that a party's initial burden on a Petition to Compel arbitration does not include fully "authenticating" an arbitration agreement, unless the other side disputes the agreement is authentic in its opposition.
we conclude that defendants here met their initial burden by attaching to their petition a copy of the purported arbitration agreement bearing Espejo’s electronic signature. Once Espejo challenged the validity of that signature in his opposition, defendants were then required to establish by a preponderance of the evidence that the signature was authentic.That's good news unless, as in this case, the employee is going to deny electronically signing the document. Doctor Espejo recalled electronically signing his offer letter, but he did not remember authorizing his electronic signature on the other documents. So, as it says above, Kaiser then had to prove authenticity by a preponderance of the evidence. This issue will arise a lot in other contexts, such as handbook receipts, commission plans, etc. How does one prove to a court that an electronic acknowledgment is real? Remember, that's the only reason employers have these sign-offs - in case of litigation. So, it pays to have a way of proving they are valid.
The Court of Appeal reviewed the law in this area and approved the declaration that Kaiser submitted. To prove an electronic signature is valid under Civil Code section 1633.9, subd. (a), it is necessary to prove it is the "act of the person" whom you want to establish signed the document. The Court of Appeal reviewed Kaiser's declaration and decided it was sufficient to do so:
Tellez detailed SCPMG’s security precautions regarding transmission and use of an applicant’s unique user name and password, as well as the steps an applicant would have to take to place his or her name on the signature line of the employment agreement and the DRP. Based on this procedure, she concluded that the “name Jay Baniaga Espejo could have only been placed on the signature pages of the employment agreement and the DRP by someone using Dr. Espejo’s unique user name and password. . . . [¶] Given this process for signing documents and protecting the privacy of the information with unique and private user names and passwords, the electronic signature was made by Dr. Espejo” on the employment agreement and the DRP at the date, time, and IP address listed on the documents. These details satisfactorily meet the requirements articulated in Ruiz and establish that the electronic signature on the DRP was “the act of” Espejo (Civ. Code, § 1633.9, subd. (a)), and therefore provide the necessary factual details to properly authenticate the document.So, to prove electronic signatures depict the acknowledgment of the person whom the company wants to say signed the document, the following is necessary:
- a company witness has to know how the electronic signature process works and has to be able to explain it in a declaration. The vendor has to have a white paper explaining the process in plain English, and training for HR and IT;
- the electronic signature process has to have sufficient security safeguards to allow a court to find that it is more likely than not the signature of the person you want it to be. It always helps to have an email confirmation of the signing event sent to the email user with a return receipt; and
- the lawyer has to know how to draft a proper declaration of a person who can lay foundation regarding knowledge of how the process works and how it was applied to the plaintiff. (You're welcome).
This case is Espejo v. Southern California Permanente Medical Group and the opinion is here.
