When a party moves to compel arbitration, the first question for a court is: has arbitrability been delegated to the arbitrator? Many commercial contracts expressly delegate the gateway question of arbitrability to the arbitrator. In the face of such delegation provisions, the Federal Arbitration Act (FAA) narrows judicial discretion, which often results in courts compelling arbitration.

The U.S. Supreme Court recently clarified the scope of such delegation provisions in Coinbase v. Suski, No. 23-3 (U.S. June 30, 2023).  In Suski, the parties executed not one, but two consumer contracts: the first, a general user agreement with an arbitration agreement; and the second, a subsequently created set of program rules with a forum selection clause. The court recently held that, in this scenario, a court, not an arbitrator, must decide whether the parties agreed to send a given dispute to arbitration.

Delegation Under the FAA