Lamps Plus, Inc. v. Varela (17-988)

argument 17-988

Lamps Plus, Inc. v. Varela

Supreme Court of the United States 1h 0m 6 speakers 8 chapters transcribed 6 days ago official recording ↗

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What standard does the Supreme Court apply to determine if an arbitration agreement permits class arbitration?

John G. Roberts 0:00

We'll hear argument

Unknown 0:00

next in case seventeen nine eighty eight Lamps Plus versus Varella. Mr Pinkus? Thank you, Mr Chief Justice, and may it please the court. This court has repeatedly recognized that the changes brought about by the shift from bilateral arbitration to class action arbitration are fundamental. The question in this case is what standard a Court should apply in determining whether an arbitration agreement authorises class arbitration. Uh as a threshold matter, uh we think it is clear that federal law imposes a minimum standard that must be satisfied in order to permit class arbitration. The court made that clear in Stolt Nielsen, where it said a party may not be compelled under the FAA to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so.

Elena Kagan 0:44

But don't you make that determination under state law. I didn't think the FAA um in any way undoes state law unless the basis of the state law is directed only to arbitration, which isn't the case.

Unknown 1:02

I don't think that's correct, Your Honor. Uh i the clear and unmistakable standard that was being discussed uh in the last case is a is a standard that the FAA imposes.

Elena Kagan 1:11

Well that's a standard that's basically dicta because there the parties agree. the agreement didn't.

Unknown 1:18

No, but but but in first options, where the court adopted that standard, uh the court said that it was the FAA that imposes the clear and unmistakable requirement before the before a c a an arbitration agreement may be construed to delegate gateway issues to the remote.

Elena Kagan 1:36

You claim there's jurisdiction for you to appeal this case. Let's assume the plaintiff or the petitioner. Or I guess it would be the respondent here, either way. that a party who seeks class uh arbitration is denied class arbitration. Can they appeal directly?

Unknown 1:57

If if the case is in the same posture as this one where the district court dismissed the action, then then the the provision that we rely on, Section sixteen A three, would provide for an appeal.

Elena Kagan 2:06

So what's good for the goose is good for the gander? interim orders. Um denying or granting class arbitration as the case may be. Because each losing party will have the opportunity to come to us and the arbitration won't proceed.

Unknown 2:27

Well, it is not just class arbitration. Today in the lower courts, when a lower court uh dismisses a case and grants uh arbitr in favor of an order granting arbitration, those c those cases are immediately appealable in courts like the Ninth Circuit, and there are many, many appeals pending right now in the Ninth Circuit on that basis. The

Elena Kagan 2:46

courts aren't staying those cases?

Unknown 2:48

Excuse me? Some courts stay them and some courts don't, Your Honor.

Elena Kagan 2:51

Why?

Stephen G. Breyer 2:52

I mean throughout again, throughout law There's always a fight. between making interlocutory matters immediately appealable, which if you do will often save a lot of money. And waiting till the end. And the normal decision here is wait till the end. And then there are exceptions, mandamus and certified questions. But when we read the statute It says what the district court shall do if he is satisfied that this is arbitrable shall on application of one of the parties stay the trial of the action until the arbitration has been had. This judge didn't do it, and you didn't y your predecessor didn't ask him to do it. So this seems like a fluke. But if we were to say these are appealable, It's not only contrary to a very basic principle of of of uh how to run courts, but it's also, because of that, going to have just the effect uh uh Justice Sudemeyer said.

Unknown 3:51

Well, a couple of answers, Your Honor. This case is in the exact same posture as Randolph, where the Court made the initial decision that 16A3, coupled with a dismissal, provides for an immediate appeal. The Court in Randolph noted that there was a question about the question that Your Honor raises whether it is proper for a district court to issue a stay or to dismiss the case and said at that point. Didn't that wasn't uh briefed, it wasn't a question before the court, it wasn't gonna decide it.