Who Resolves Class Arbitrability?

By Reif, David | Defense Counsel Journal, October 2014 | Go to article overview

Who Resolves Class Arbitrability?


Reif, David, Defense Counsel Journal


This article originally appeared in the July 2014 Alternative Dispute Resolution Committee newsletter.

THE United States Supreme Court's 2010 decision in Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp.,1 reaffirmed the principle that the parties' intention governs the determination of whether an arbitration should proceed on a classwide basis. Left open in Stolt-Nielsen, however, was the issue of whether the court or the arbitrator would determine that intent. Arbitration practitioners and litigators were looking forward to the Court resolving that issue by way of its decision in Oxford Health Plans, LLC v. Sutter.2

The Sutter decision left those expectations unsatisfied. Based on the record before the Court, Justice Kagan, writing for a majority bench,3 held that, as the parties had stipulated that the arbitrator would determine whether there was an intention to allow class arbitration, the court would review his determination that the case should proceed as a class under the limited scope of review permitted by Section 10(a)(4) of the Federal Arbitration Act.4 Applying that limited review, the Court affirmed the lower court's denial of an application to vacate the decision, finding that there was no fraud or other defense which would have required the court to set aside the award. Interestingly, the majority opinion states that, faced with the question of class arbitrability ab initio, the court might very well have differed from the conclusion of the arbitrator. "Nothing we say in this opinion should be taken to reflect any agreement with the arbitrator's contract interpretation, or any quarrel with Oxford's contrary reading. . . . The potential for those mistakes is the price of agreeing to arbitration. . . . [The arbitrator's] interpretation went against Oxford, maybe mistakenly so."5

The issue which many had hoped the Supreme Court would resolve - who decides class status - was relegated to a footnote and left for another day. In footnote 2, the Court raised the issue of who makes the decision, but moved no further toward its resolution. While Justice Kagan describes "questions of arbitrability" as being "presumptively for courts to decide," she does not address whether class arbitrability is such a "question." "StoltNielsen made clear that this Court has not yet decided whether the availability of class arbitration is a question of arbitrability. See 559 U.S. at 680. But this case gives us no opportunity to do so because Oxford agreed that the arbitrator should determine whether its contract with Sutter authorized class procedures."6

Given the outcome in Sutter, this article will take a look at how some of the lower courts have resolved the issue in the absence of guidance from above.

As the lower court cases consistently rely upon or, at least, discuss the Supreme Court's decision in Green Tree Fin. Corp. v. Bazzle,7 some preliminary understanding of that case is necessary. Bazzle was an appeal from the South Carolina Supreme Court, which had held that an arbitration clause which was silent as to the availability of a class-wide proceeding could be interpreted under South Carolina substantive law as permitting class certification. The lineup of the opinions in Bazzle made for a very confusing array of potential holdings. The plurality of the Court, in an opinion by Justice Breyer, joined by Justices Scalia, Souter and Ginsburg, very specifically held that the question of whether the arbitration agreement forbids class certification is for the arbitrator to decide,8 and that the courts below erred in making that determination. They considered the appropriate remedy to be the vacating of the judgment below and a remand for further proceedings. Chief Justice Rehnquist and Justices O'Connor and Kennedy dissented and would have held that the decision of whether a matter may proceed as a class arbitration is "one for the courts, not for the arbitrator "9 They also would have held that the Federal Arbitration Act, not South Carolina substantive law, governed the dispute and that, under that federal law, the South Carolina Supreme Court wrongly interpreted the agreement. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Who Resolves Class Arbitrability?
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.