美国第三巡回法庭判定法院而非仲裁委员会对集体诉讼的可仲裁性有最终决定权(英文版)
In Brief
The history and proceedings of the Third Circuit's recent decision in Chesapeake Appalachia, LLC v. Scout Petroleum, LLC, No. 15-1275, 2016 U.S. App. LEXIS 42 (3d Cir. Jan. 5, 2016), are a precautionary tale suggesting that companies should expressly state key "rules of their game" in arbitration provisions. This includes whether claims such as class actions are subject to arbitration and, in the event of a dispute, where the issue of arbitrability will be determined.
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Contracts containing agreements to arbitrate often provide for arbitration pursuant to the rules of an arbitration service provider such as the American Arbitration Association ("AAA"). It is not unusual, however, for such clauses to incorporate little (or no) detail regarding the arbitration process, decision-makers on disputed jurisdictional issues, or the availability of class, collective or other group claims. In just such a context, on January 5, 2016, the United States Court of Appeals for the Third Circuit held that it was for a court—not an arbitration panel—to decide whether classwide arbitration could proceed in an oil and gas royalty dispute. But before the Third Circuit ruled, another federal district court interpreted the exact same clause otherwise, as did an arbitration panel of three retired federal judges.
The Procedural History
In Chesapeake Appalachia, LLC v. Scout Petroleum, LLC, No. 15-1275, 2016 U.S. App. LEXIS 42 (3d Cir. Jan. 5, 2016), plaintiff Scout Petroleum ("Scout") brought suit against Chesapeake Appalachia, LLC ("Chesapeake") alleging that Chesapeake underpaid royalties under lease agreements. Scout brought its claims as a classwide arbitration action before a AAA panel, based upon the following arbitration provision contained in the leases at issue:
ARBITRATION. In the event of a disagreement between Lessor and Lessee concerning this Lease, performance thereunder, or damages caused by Lessee's operations, the resolution of all such disputes shall be determined by arbitration in accordance with the rules of the American Arbitration Association.
Chesapeake Appalachia, 2016 U.S. App. LEXIS 42 at *3.
Chesapeake then filed a declaratory judgment action to stop the
class arbitration in federal court, arguing that it had not
consented to class arbitration. Id. at *9. While the
federal action was pending, the arbitration panel—consisting
of three retired federal judges—examined the arbitration
agreement and ruled that "'the arbitration contract in
this case clearly and unmistakably authorizes [the panel] to make
the decision about arbitrability.'" Id. at *10.
The panel thus concluded, based on the clause's incorporation
of the AAA rules, that the panel was empowered to determine whether
class arbitration was available per the terms of Chesapeake's
leases. The panel ultimately decided that class arbitration was
appropriate. Id. But Chesapeake then sought and received
an order from the federal district court vacating the
arbitrators' ruling. The court held that the arbitrators lacked
authority to decide whether class arbitration was appropriate.
Id. at *11.
The very next day, however, another judge in the same district
entered an opinion concerning the same arbitration language in a
different oil and gas lease and reached the opposite result. That
judge concluded, as the AAA arbitration panel had, that the
arbitration agreement clearly authorized the arbitrators, not the
court, to resolve the question of arbitrability of the class
claims.1 Just a few months later, judges in two other
cases filed in a neighboring state's federal district
court—again addressing the same arbitration language in other
oil and gas leases—agreed with the first federal court. They
reserved the question of classwide arbitrability to the
court.2
The Third Circuit's Decision
In the wake of these conflicting results, Scout sought appellate
review of the district court's original decision in
Chesapeake Appalachia, asking that the court defer to the
arbitration panel's decision regarding arbitrability. On
appeal, the Third Circuit reaffirmed Opalinski v. Robert Half
Int'l, Inc., 761 F.3d 326 (3d Cir. 2014), a recent opinion
in which the court had assessed whether it is courts or arbitrators
who appropriately address "question[s] of arbitrability,"
i.e., the "narrow range of gateway issues" respecting
matters as fundamental as whether the parties have actually agreed
to arbitrate. Chesapeake Appalachia, 2016 U.S. App. LEXIS
42 at *22-23. The court held that "the availability of class
arbitration is a 'question of arbitrability' for a court to
decide unless the parties unmistakably provide otherwise."
Id. at *26 (citing Opalinski, 761 F.3d at
335-36).
The court next turned to the specific lease agreements at issue to
determine if the parties had "unmistakably" given
authority to a panel of arbitrators to decide whether class
arbitration was available. Chesapeake Appalachia, 2016
U.S. App. LEXIS 42 at *28. CheCScout argued that reference
to the AAA's rules in the lease agreements incorporated all of
the AAA's standards, including the Commercial Arbitration Rules
and the Supplementary Rules for Class Arbitration, which purport to
allow an arbitrator to determine whether the parties have agreed to
class arbitration. Id. at *35-37. The court disagreed,
finding mere reference to the AAA's rules insufficient to
constitute the "clear and unmistakable evidence" required
to pass authority from the court to the panel of arbitrators.
Id. at *37-38. The court acknowledged that no
"special 'incantation'" is required to give the
arbitrator control over questions of arbitrability, id. at
*29-30, but it deemed the incorporation of the AAA's many rules
by reference insufficient to overcome the heavy presumption in the
Third Circuit in favor of judicial decision on classwide
arbitrability:
We ... agree with Chesapeake that this case implicates "a daisy-chain of cross-references"—going from the Leases themselves to "the rules of the American Arbitration Association" to the Commercial Rules and, at last, to the Supplementary Rules. Having examined the various AAA rules, we believe that the Leases still fail to satisfy the onerous burden of undoing the presumption in favor of judicial resolution of the question of class arbitrability.
Id. at *37-38.
The Third Circuit then affirmed the district court's order
vacating the arbitrators' decision as to the availability of
class arbitration based upon the fact that the parties had not
given the arbitrators the authority to make that decision.
Id. at *51. The court's opinion was limited to the
"who decides" inquiry; the court did not conduct its own
assessment of the parties' agreement respecting class
arbitration, presumably leaving that decision to the district
court. See id. at *34.
Contrast to Bilateral Arbitration Provisions
With its holding in Chesapeake Appalachia, the Third Circuit joins the Sixth Circuit as the only federal appellate courts to consider and decide the impact of references to general arbitration rules on the question of who decides whether the parties have agreed to classwide arbitration. Id. at *17. While "'[v]irtually every circuit to have considered the issue'" in the bilateral arbitration context has held that incorporation of the AAA's rules by reference constitutes "clear and unmistakable evidence that the parties agreed to arbitrate arbitrability,"3 only the Third and Sixth Circuits have assessed whether the same standard applies to the availability of classwide arbitration. Chesapeake Appalachia and its counterparts in the Sixth Circuit4 have both said no: While incorporating the AAA's rules into a contract gives an arbitrator the authority to determine whether the parties have agreed to bilateral arbitration, a general reference to the AAA rules is not sufficient to allow an arbitrator to determine whether the parties have agreed to classwide arbitration. Other Courts of Appeal have not yet spoken on the issue.
Conclusion
Chesapeake Appalachia serves as notice of potential
pitfalls to parties who do not memorialize their expectations for
arbitration. Simple reference to the AAA's—or another
entity's—rules may have unintended consequences if, and
when, those rules are amended, edited, or otherwise changed between
the contract's execution and the date of arbitration. Further,
referring to the AAA's rules generally may not suffice to
identify the particular AAA rules under which the parties have
agreed to arbitrate or to incorporate all of the AAA's
provisions on jurisdictional issues and, for example, the
availability or waiver of class action arbitration.
Parties seeking certainty should consider incorporating express
language identifying particular rules under which claims are to be
decided, what types of disputes are covered by the agreement to
arbitrate, and where jurisdiction lies for the determination of
arbitrability itself. Thoughtful drafting can avoid potentially
costly uncertainty as to what will be arbitrated—and who will
make that determination—if a dispute should arise.
Footnotes
1 See Chesapeake Appalachia, LLC v. Burkett, Civ. Action No. 3:13-3073, 2014 U.S. Dist. LEXIS 148442 (M.D. Pa. Oct. 17, 2014).
2 See Chesapeake Appalachia, LLC v. Suppa, 91 F. Supp. 3d 853 (N.D. W. Va. 2015); Bird v. Turner, Civ. Action No. 5:14-97, 2015 U.S. Dist. LEXIS 116057 (N.D. W. Va. Sept. 1, 2015).
3 See, e.g., Oracle Am., Inc. v. Myriad Grp. A.G., 724 F.3d 1069, 1074 (9th Cir. 2013); Petrofac, Inc. v. DynMcDermott Petrol. Operations Co., 687 F.3d 671, 675 (5th Cir. 2012); Fallo v. High-Tech Inst., 559 F.3d 874, 878 (8th Cir. 2009); Qualcomm Inc. v. Nokia Corp., 466 F.3d 1366, 1373 (Fed. Cir. 2006); Terminex Int'l Co. v. Palmer Ranch Ltd. P'ship, 432 F.3d 1327, 1332 (11th Cir. 2005); Contec Corp. v. Remote Solution Co., 398 F.3d 205, 208 (2d Cir. 2005).
4 Huffman v. Hilltop Cos., LLC, 747 F.3d 391 (6th Cir. 2014), and Reed Elsevier, Inc. v. Crockett, 734 F.3d 594 (6th Cir. 2013).
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