Justice Scalia and Arbitration

I join the nation in mourning over the loss of Justice Antonin Scalia this past weekend.  Though I rarely agreed with his written opinions, he certainly did provoke and engage in healthy debates about critical issues, which are incredibly important to a functioning democracy.

Having just published an article critiquing three of his most recent opinions in the area of arbitration (see Jill I. Gross, Justice Scalia’s Hat Trick and the Supreme Court’s Flawed Understanding of Twenty-First Century Arbitration, 81 Brooklyn L. Rev. 111 (2015)), I suppose I should have some insight into what his loss will mean for Supreme Court arbitration jurisprudence.  (After all, my timing was uncanny.)

Clearly, the outcome of future arbitration decisions by the Court does depend on who is sworn in as the next Supreme Court Justice. But, losing Scalia’s voice also opens up the possibility of a few variations in future decisions interpreting the scope of the Federal Arbitration Act:

  • My article points out a factual error in the Italian Colors opinion, which was authored by Justice Scalia.  The opinion incorrectly cites the 1991 Gilmer opinion as precedent for the enforcement of a class action waiver, even though in that case the arbitration clause at issue contained no such waiver.  In fact, since that case involved a securities industry arbitration (employment/age discrimination case), class claims were preserved for claimants.   Without Justice Scalia, it might be easier for a future SCOTUS to retreat from the error in — and thus distinguish — Italian Colors, and perhaps be less willing to enforce class action waivers in the future if a plaintiff can show it could not vindicate statutory rights.
  • Justice Scalia led the chorus of voices harshly critical of class actions as a mechanism for reform.  He strictly construed the FAA’s mandate to enforce arbitration agreements as written to apply equally to class action waivers and thus diminished the use of class actions.  However, in order to support his conclusions, he also equated class arbitration as arbitration not contemplated by the FAA.  That view cannot possibly be the product of strict constructionism, as the FAA does not mention class arbitration one way or the other, nor does it define arbitration as a particular kind of procedure.  Perhaps a future SCOTUS will revisit that equation and be more willing to find that class arbitration is arbitration within the meaning of the FAA.
  • Justice Scalia seemed to be the least sympathetic to concerns that forced arbitration of statutory rights violated public policy. This stemmed, in part, from his lack of interest in considering legislative history.   With important new works on the legislative history of the FAA suggesting that mandatory arbitration of consumer and employee disputes was not the type of arbitration contemplated by the drafters of the FAA (e.g., Imre Salazai’s book Outsourcing Justice), perhaps a future Court will be more interested in considering the FAA’s legislative history.

These are just some preliminary thoughts.  I have not had much time to think through these points, so I welcome your views as to my initial predictions.

One thought on “Justice Scalia and Arbitration”

  1. I read this post and some quick reading on the paper you mentioned. But you refer mostly to US domestic arbitration. Some thoughts on Scalia´s influence in the US judicial understanding on international commercial and investment arbitration?

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