In a major victory for business groups, the U.S. Supreme Court held Tuesday that the validity of a contract that includes an arbitration provision must be decided by an arbitrator, not a state judge — unless what’s challenged is the arbitration provision itself.
The 7-1 decision in Buckeye Check Cashing v. Cardegna et al. overturned a January 2005 ruling by the Florida Supreme Court that a state court first must establish whether the underlying contract at issue in Buckeye violated state or federal law before its arbitration provision could be enforced. The nation’s highest court ruled that the Federal Arbitration Act took precedence over Florida law.
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