The Future of Federal Arbitration Act Practice After 'Badgerow'
The importance of 'Badgerow' is its conclusion that a federal court faced with a petition to confirm or vacate an award under Sections 9 and 10 of the FAA could not "look through" the petition to the underlying arbitral controversy to determine grounds for federal court jurisdiction
January 05, 2024 at 10:00 AM
8 minute read
LitigationBuried in a footnote in Moses H. Cone Memorial Hospital v. Mercury Construction, 103 S. Ct. 927 (1983) is a statement by the U.S. Supreme Court that bears remembering when it comes to the Federal Arbitration Act (FAA). The Moses court explained that the FAA "is something of an anomaly in the field of federal-court jurisdiction. It creates a body of federal substantive law establishing and regulating the duty to honor an agreement to arbitrate, yet it does not create any independent federal-question jurisdiction under 28 U.S.C. §1331 or otherwise."
That lesson was repeated in Hall Street Associates v. Mattel, 128 S. Ct. 1396 (2008), where the court wrote that "[a]s for jurisdiction over controversies touching arbitration, the act does nothing" to bestow federal jurisdiction. The description of the FAA as a jurisdictional "anomaly" has proven to be a thorny issue, with the question of which FAA-related cases do and do not belong in federal court returning to the Supreme Court on multiple occasions. The most recent occasion was Badgerow v. Walters, 142 S. Ct. 1310 (2022) where the Supreme Court again reminded federal court litigants of the FAA's anomalous jurisdictional landscape.
The importance of Badgerow is its conclusion that a federal court faced with a petition to confirm or vacate an award under Sections 9 and 10 of the FAA could not "look through" the petition to the underlying arbitral controversy to determine grounds for federal court jurisdiction (e.g., whether the arbitration claim involved a question of federal law). The "look through" approach had been approved in Vaden v. Discover Bank, 129 S. Ct. 1262 (2009) as a mechanism for assessing whether a federal court had jurisdiction to consider a petition to compel arbitration under Section 4 of the FAA.
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