Badgerow v. Walters

Whether federal courts have subject-matter jurisdiction to confirm or vacate an arbitration award under Sections 9 and 10 of the FAA where the only basis for jurisdiction is that the underlying dispute involved a federal question.

Petitioner's claims against her former employer were dismissed following a arbitration proceeding. The question presented is whether federal courts have subject-matter jurisdiction to confirm or vacate an arbitration award under Sections 9 and 10 of the FAA where the only basis for jurisdiction is that the underlying dispute involved a federal question. The lower court established itself as “bound” by earlier decisions and applied the “look-through” approach. In Vaden v. Discover Bank, 556 U.S. 49 (2009), the Court held that a federal court may “look through” a petition to decide whether the parties underlying dispute gives ride to federal-question jurisdiction. The Court focused on Section 4 of the Federal Arbitration Act (FAA). Because the circuit courts are divided over whether this same “look through” method applies to motions to confirm or vacate arbitration, the Court grants this petition. The question presented is of legal and practical importance because, there are a massive number of arbitrated cases each year. Motions to enforce or vacate are common and there is a high risk for uncertainty until the Court weighs in. This case is ideal as the dispute turns on just a pure question of law.