Arbitration Agreements Can Control Who Decides Arbitrability: Arbitrator Or Court

Key Points

• The Supreme Court held that, under the Federal Arbitration Act (FAA), courts must enforce arbitration contracts according to their terms, including provisions authorizing arbitrators to decide "gateway" questions of arbitrability.
• The Court also held that there is no exception to this rule when a party contends that an arbitration demand is wholly groundless.

Background

Archer & White Sales, Inc., a dental equipment distributor, sued competitor Henry Schein, Inc., alleging violations of the Sherman Antitrust Act and various parallel state laws, and seeking monetary damages and injunctive relief.

Schein moved to compel arbitration. Archer opposed on the grounds that the arbitration agreement exempted actions seeking injunctive relief. Schein responded that the "main thrust" of the litigation was for monetary damages, so the matter was subject to arbitration.