Jottings By An Employer's Lawyer

Wednesday, March 03, 2004

Federal Arbitration Act Does Not Confer Jurisdiction - Not To Compel or Vacate

So says the 5th Circuit in Smith v. Rush Retail Centers, Inc. (5th Cir. 3/3/04) [pdf]. The Court notes that they are only acting consistent with the concept of a court of limited jurisdiction, and are joining:
The Second, Sixth, Seventh, Ninth, Eleventh, and District of Columbia Circuits [which] have held that ยง 10 of the FAA does not confer federal jurisdiction and that there must be an independent basis for federal jurisdiction before a district court may entertain a petition to vacate an arbitration award.
Although in the past the jurisprudence surrounding arbitration was somewhat arcane, it is becoming more mainstream. Here, the defendant didn't challenge jurisdiction, but the magistrate did. Find diversity (and $75,000 in controversy, see 9th Circuit view on that here), a federal question, or go to state court.


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