As a consequence of the strong public policy favoring arbitration, courts generally give a wide berth to arbitrators and routinely defer to their authority and decisions. Despite that deference, courts continue to play an important role at the perimeters, policing to a limited, but important, extent what cases are subject to arbitration, and when, and ensuring that neither the process nor the ultimate decision is tainted by gross injustice. The recent cases we discuss below from the U.S. District Court for the Southern District of New York illustrate that in the right circumstances courts will protect against abuses of the arbitration process, but that litigants try far more often than they succeed to lure courts into the arbitration fray.

Whose Decision Is It?

Southern District Judge Jed S. Rakoff issued a series of decisions over the past year in Jock v. Sterling Jewelers Inc. that focus on the delicate line between an arbitrator’s power to define the scope of his or her authority and the court’s responsibility to intercede when an issue is beyond the arbitrator’s reach. The plaintiffs in Jock, female employees of the defendant jewelry store chain, commenced a class action discrimination lawsuit in federal court and then moved to refer that dispute to arbitration on a class-wide basis, based on agreements requiring arbitration of their employment disputes. Over the defendant’s objection, Judge Rakoff determined that the arbitrator should, in the first instance, determine whether the arbitration agreements permitted class-wide arbitration.1

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