On August 9, 2022, the Ninth Circuit affirmed an order compelling the Chickasaw Nation to arbitrate various health care reimbursement claims. In doing so, the Ninth Circuit rejected the Chickasaw’s argument that a federal statute or its sovereignty as an Indian tribe entitled it to avoid its arbitration agreement or the clause that delegated to the arbitrator any challenges to the scope and enforceability of the arbitration agreement. Caremark LLC v. Chickasaw Nation, No. 21-16209 (9th Cir. 2022).
Chickasaw Nation is a sovereign Indian tribe that operates its own healthcare system. Caremark is a pharmacy benefit manager for health-insurance plans. In 2020, the Chickasaw sued Caremark in the Eastern District of Oklahoma for allegedly violating the Indian Health Care Improvement Act (Recovery Act), which allows tribal healthcare providers to recover the costs of healthcare services. Citing the arbitration clause within the parties’ contract, Caremark moved to compel arbitration, and the district court granted the motion. On appeal, the Chickasaw argued that: (1) it was not bound by the arbitration provision because it never waived its tribal sovereign immunity; and (2) the Recovery Act precluded the enforcement of any agreement to arbitrate because it would “prevent or hinder” the Chickasaw’s right of recovery. 25 U.S.C. § 1621e(c).
When deciding a motion to compel arbitration, it is the court’s responsibility to decide whether the parties formed an arbitration agreement and, unless there has been a delegation to the arbitrator, the enforceability and scope of the arbitration agreement. Accordingly, the Ninth Circuit proceeded to analyze these issues.