Binding arbitration is familiar to parties who sign any contract containing an arbitration agreement. But when will courts allow a nonsignatory to compel a signatory to arbitrate under an arbitration agreement? When will courts allow a signatory to compel a nonsignatory to arbitrate under an arbitration agreement? What doctrines have the courts recognized as applying to nonsignatories and arbitration? This article will focus on these questions and offers an overview of possible routes to nonsignatory arbitration.

There are a variety of doctrines rooted in state law by which nonsignatories can compel a signatory to an arbitration agreement to arbitrate, or alternatively, be compelled to arbitrate with a signatory to an arbitration agreement. These include (1) incorporation by reference; (2) assignment, assumption, and waiver; (3) principles of agency; (4) third-party beneficiary status; (5) piercing the corporate veil and alter ego; and (6) equitable estoppel.

The U.S. Supreme Court stated in GE Energy Power Conversion SAS v. Outokumpu Stainless USA, 140 S. Ct. 1637 (2020), that "Chapter 1 of the Federal Arbitration Act (FAA) permits courts to apply state-law doctrines related to the enforcement of arbitration agreements" and that "[t]he 'traditional principles of state law' that apply under Chapter 1 include doctrines that authorize the enforcement of a contract by a nonsignatory." Id. at 1643. The court cited the doctrines of "assumption, piercing the corporate veil, alter ego, incorporation by reference, third-party beneficiary theories, waiver and estoppel." Id. at 1643-44 (quoting Arthur Andersen v. Carlisle, 556 U.S. 624, 631 (2009)). The court held the New York Convention did not conflict with domestic equitable doctrines that permit the enforcement of arbitration agreements by nonsignatories. Notably, these same doctrines can permit a signatory to enforce an arbitration agreement against a nonsignatory as the cases cited below illustrate.