US Supreme Court Dismiss Arbitrability Dispute l ZFZ Postcard Cases

On Monday 25 January 2021, SCOTUS issued a one-page order to dismiss the writ of certiorari to Henry Schein Inc. v. Archer and White Sales Inc., “as improvidently granted”.

This case was previously before SCOTUS (No.17-1272). A brief summary: Archer and White sought damages and injunctive relief before the District Court., Henry Schein requested to refer the matter to arbitration, invoking the Federal Arbitration Act (FAA). The District Court agreed with Archer and White, that Henry Schein’s argument was “wholly groundless”, and the Fifth Circuit Court of Appeals affirmed. However, SCOTUS unanimously opined that the “wholly groundless” exception is not consistent with the FAA, and remanded the case to the Fifth Circuit to address, whether the contract at issue, delegated the threshold question of arbitrability to an arbitrator.

On remand, the Fifth Circuit ruled that an arbitration agreement with carve outs does not clearly and unmistakably delegate the question of arbitrability to an arbitrator for disputes that fall within the exception, and refused to compel arbitration. Henry Schein petitioned for a writ of certiorari against this judgement.

Read the SCOTUS order here.