Supreme Court to Hear “Groundless Arbitration” Case

On June 25, 2018, the U.S. Supreme Court granted certiorari in Henry Schein Inc. v. Archer and White Sales Inc., No. 17-1272, to answer the question of “[w]hether the Federal Arbitration Act permits a court to decline to enforce an agreement delegating questions of arbitrability to an arbitrator if the court concludes the claim of arbitrability is ‘wholly groundless.’” In the lower appellate phase of this dispute, the U.S. Court of Appeals for the 5^th Circuit ruled last December that Federal courts did indeed have the authority to do so.

Granting this cert petition will allow the Supreme Court to resolve a circuit split on the issue between the Fourth, Fifth, Sixth, and Federal Circuits, holding on the one hand that federal courts may decide an arbitrability issue if the claim for arbitrability is “wholly groundless,” and the Tenth and Eleventh Circuits, holding on the other hand that if there is a contractual delegation of arbitrability to the arbitrators then the courts must compel arbitration to resolve the arbitrability issue even if it appears to the court that the claim of arbitrability is entirely groundless.

The dispute will be argued in the October Term of the Court.

Mark Kantor is a member of the College of Commercial Arbitrators in Washington, D.C.

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