Summary

Judgment REVERSED and case REMANDED. Kagan, J., delivered the opinion of the Court, in which Roberts, C. J., and Thomas, Alito, Sotomayor, Gorsuch, Kavanaugh, and Barrett, JJ., joined. Breyer, J., filed a dissenting opinion.

No. 20-1143. Argued November 2, 2021--Decided March 31, 2022

The Federal Arbitration Act authorizes a party to an arbitration agreement to petition a federal court for various forms of relief. But the Act's authorization of such petitions does not itself create the subjectmatter jurisdiction necessary for a federal court to resolve them. Rather, the federal court must have an "independent jurisdictional basis" to do so. Hall Street Associates, L. L. C. v. Mattel, Inc., 552 U. S. 576, 582. In Vaden v. Discover Bank, 556 U. S. 49, this Court assessed whether there was a jurisdictional basis to decide an FAA Section 4 petition to compel arbitration by means of examining the parties' underlying dispute. The Court reasoned that specific language in Section 4 instructed a federal court to "look through" the petition to the "underlying substantive controversy." Id., at 62. If the dispute underlying a Section 4 petition falls within the court's jurisdiction--for example, by presenting a federal question--then the court may rule on the petition to compel arbitration.

In this case, the question presented is whether that same "lookthrough" approach to jurisdiction applies to applications to confirm or vacate arbitral awards under Sections 9 and 10 of the FAA. Petitioner Denise Badgerow initiated an arbitration proceeding against her employer's principals (collectively, Walters), alleging that she was unlawfully terminated. After arbitrators dismissed Badgerow's claims, she filed suit in Louisiana state court to vacate the arbitral award. Walters removed the case to Federal District Court and applied to confirm the award. Badgerow then moved to remand the case to state court, arguing that the federal court lacked jurisdiction to resolve the parties' requests--under Sections 10 and 9 of the FAA, respectively--to vacate or confirm the award. The District Court applied Vaden's look-through approach, finding jurisdiction in the federal-law claims contained in Badgerow's underlying employment action. The District Court acknowledged that Sections 9 and 10 of the FAA lack the distinctive text on which Vaden relied, but it applied the look-through approach anyway so that "consistent jurisdictional principles" would govern all kinds of FAA applications. The Fifth Circuit affirmed.

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