Supreme Court To Settle Longstanding Split Over Stays Pending Arbitration Appeals

The Supreme Court just agreed to review an important question at the intersection of arbitration law and appellate practice. Its ultimate decision in the case could provide a major boost to defendants seeking to enforce arbitration agreements in circuits (including the Second and Ninth) where they currently operate under a disadvantageous rule.

Section 16(a) of the Federal Arbitration Act permits immediate interlocutory appeal of a district court's denial of a motion to compel arbitration. When a defendant exercises that right, what happens to the underlying district court litigation-does it proceed apace or is it automatically stayed until the appellate court decides whether the dispute should be in court at all? The circuits have long disagreed on that question, and on December 9 the Supreme Court granted certiorari to answer it.