WASHINGTON — Brett Kavanaugh on Tuesday delivered his first written opinion as a Supreme Court justice, a unanimous ruling empowering arbitrators in contractual disputes.
The question in Henry Schein v. Archer and White Sales was whether the Federal Arbitration Act allows a court to block an arbitration claim if it considers the request “wholly groundless” based on the terms of the contract.
In other words, who has the authority to decide whether a dispute meets the threshold for arbitration — the arbitrator or a judge?
In the court’s opinion, the arbitrator does.
“The ‘wholly groundless’ exception to arbitrability is inconsistent with the Federal Arbitration Act and this Court’s precedent,” Kavanaugh wrote. “When the parties’ contract delegates the arbitrability question to an arbitrator, the courts must respect the parties’ decision as embodied in the contract … even if the court thinks that the arbitrability claim is wholly groundless.”
The court’s opinion vacates a ruling by the U.S. Court of Appeals for the Fifth Circuit, which concluded a court can decide the issue of arbitrability.
The issue arose after Archer and White, a dental equipment distributor, filed a lawsuit against manufacturer Henry Schein Inc., alleging violations of federal and state antitrust law. Schein asked a district court to refer the dispute to arbitration. Archer and White wanted the court’s opinion on whether it met the threshold for arbitration.