David N. Cinotti Discusses Recent U.S. Supreme Court Case’s Impact on Delegation Clauses Under FAA

David N. Cinotti, partner at Pashman Stein Walder Hayden P.C., was recently quoted in an article titled “Cryptocurrency Spat Pushes Highest Court in US to Reaffirm its Position on Arbitration in Dual Contract Cases,” published in Commercial Dispute Resolution. The article discusses a recent U.S. Supreme Court decision, Coinbase v. Suski, which addresses the division of authority between arbitrators and courts [under the Federal Arbitration Act ] when it comes to the threshold issue of whether a dispute is subject to an arbitration agreement—generally called “arbitrability.”  This case dealt with two successive agreements between the same parties—one that called for arbitration and the other that called for litigation.  The U.S. Supreme Court held that it was for the court to decide whether the arbitration or litigation clause applied to the parties’ dispute, not an arbitrator.  That was true even though the arbitration agreement included a so-called delegation clause, which delegated to an arbitrator issues relating to the enforceability, revocability, scope, or validity of the arbitration agreement.   

In a statement commenting on the effects of the decision, David Cinotti, an international and federal litigation partner at Pashman Stein Walder Hayden, said while the case is not a major milestone under the Federal Arbitration Act, it is likely to confine the impact of delegation clauses in arbitration agreements.

“Although delegation clauses will often lead courts to refer arbitrability disputes to arbitration, that is not the case where the question is whether the delegation clause is valid or effective because, for example, the agreement in which it is contained was revoked or superseded,” Cinotti said.

Cinotti has a wealth of experience in litigating issues under the Federal Arbitration Act and has written extensively on the statute, which you can read more about here.

To read the full article, click here.