Supreme Court’s Splitting of the ‘Jurisdictional Atom’ Threatens to Blow up the Federal Arbitration Act

Abstract

A recent US Supreme Court decision sharply narrows the jurisdiction of federal district courts to administer arbitration matters under the Federal Arbitration Act (FAA). When a federal district determines whether it has subject-matter jurisdiction to compel arbitration, it may take into consideration both the petition to compel arbitration and the underlying dispute. This is known as the ‘look through approach’ because the court can look beyond the pending motion to the underlying case. Recently, the US Supreme Court ruled that the look through approach cannot be used when the federal court is asked to confirm or vacate an arbitral award. This can produce the incongruous result that a federal district court could have the authority to compel an arbitration but not to confirm the resulting award. The US Supreme Court left for future determination the question of whether the look through approach can be used for other judicial functions under the FAA such as appointment of the arbitrator.