Welcome
Class Action News

Employer’s Attorney Concedes Arbitration Issue at SCOTUS

Oct. 3, 2018, 7:35 PM

“We trust courts” to decide whether a long-haul trucker’s wage suit can be resolved in arbitration, Theodore J. Boutrous, who represented the trucker’s employer, told the U.S. Supreme Court Oct. 3.

In saying so, Boutrous seemed to concede a point companies have been trying to make for years: that whether a dispute can be sent to arbitration is a question for an arbitrator, not the courts, to decide.

“Did I understand you’d be perfectly happy to have a court decide the arbitrability issue here?” Chief Justice John G. Roberts Jr. asked, pointing out it was the first question the employer presented to the court. “I thought there was a lot of fighting over the question.”

The circuit courts are divided on the “who decides” question. The Supreme Court has passed up many opportunities to consider it.

Boutrous, of Gibson, Dunn & Crutcher LLP in Los Angeles, was trying to get the court back to the question his client, New Prime, was really interested in: whether Congress meant to exclude interstate transportation workers classified as independent contractors from the Federal Arbitration Act.

Justice Neil M. Gorsuch complimented him for “moving nicely to the merits,” but said he shared the same concern raised by two of the Democrat-appointed justices.

Justice Ruth Bader Ginsburg asked how New Prime could use the FAA to enforce the arbitration clause if the worker is exempt from the act entirely. New Prime sought to invoke a delegation clause in the contract that said the parties agreed to have an arbitrator decide questions of arbitrability.

The delegation clause “would never come into play” if the agreement is outside the scope of the FAA, she said.

“If the question is whether a district court would decide this, we’d be happy to have the federal district court interpret the contract or this court could do it,” Boutrous answered.

Justice Stephen G. Breyer pointed out the court isn’t being asked to interpret the text of the parties’ agreement. “We are interpreting a statute,” he said.

Jennifer D. Bennett of Public Justice in Oakland, Calif., argued for the trucker, Dominic Oliveira. Addressing the gateway question, she said, “we don’t apply statutes that don’t apply. If a court is going to apply a statute, it has to figure out first whether it applies.”

Roberts replied, “Well, I understand your friend on the other side not to care about that.”

Bennett answered, “That’s how I understood the argument as well.”

The case is New Prime Inc. v. Oliveira, U.S., No. 17-340, argued 10/3/18.

To contact the reporter on this story: Perry Cooper in Washington at pcooper@bloomberglaw.com

To contact the editor responsible for this story: Steven Patrick at spatrick@bloomberglaw.com

To read more articles log in. To learn more about a subscription click here.