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Arthur Andersen, LLP v. Carlisle

Docket No.: 08-146
Certiorari Granted: Nov 7 2008
Argued: March 3, 2009
Decided: May 4, 2009

PartyNames: Arthur Andersen LLP, et al. v. Wayne Carlisle, et al.
Petitioner: Arthur Andersen LLP, et al.
Respondent: Wayne Carlisle, et al.

Court Below: United States Court of Appeals for the Sixth Circuit

Arthur Andersen LLP, et al.
v.
Wayne Carlisle, et al.
Background:

Section 3 of the Federal Arbitration Act ("FAA"), 9 U.S.C. § 3, provides that "on application of one of the parties," a district court shall stay proceedings pending arbitration if the district court concludes that the "issue involved in such suit or proceeding is referable to arbitration" under "an agreement in writing for such arbitration." Section 16(a)(1)(A) of the FAA, 9 U.S.C. § 16(a)(1)(A), provides that "an appeal may be taken from an order" of a district court denying a stay application made under Section 3.

Question Presented:

(1) Whether Section 16(a)(l)(A) of the FAA provides appellate jurisdiction over an appeal from an order denying an application made under Section 3 to stay claims involving non-signatories to the arbitration agreement.(2) Whether Section 3 of the FAA allows a district court to stay claims against nonsignatories to an arbitration agreement when the nonsignatories can otherwise enforce the arbitration agreement under principles of contract and agency law, including equitable estoppel.

Question:

1) Does Section 16(a)(1) of the Federal Arbitration Act confer appellate jurisdiction over an appeal from a motion to stay proceedings under Section 3 of the FAA when appellants are non-signatories to the arbitration agreement? 2) Does Section 3 of the Federal Arbitration Act allow a federal district court to stay proceedings when non-signatories to an arbitration agreement can attempt to enforce the arbitration agreement under contract and agency law?

Holding: reversed and remanded
Vote: 6-3
Opinion By: Justice Antonin Scalia
Read ARTHUR ANDERSEN, LLP V. CARLISLE opinion (PDF)
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