In Oxford Health Plans LLC v. Sutter (2013), the Supreme Court mentioned in a footnote that it has “not yet decided whether the availability of class arbitration” is presumptively a gateway issue for a court to decide, or presumptively for an arbitrator to decide. Earlier this week, the Sixth Circuit held the availability of class arbitration is presumptively for a court to decide.
In Reed Elsevier, Inc. v. Crockett, No. 12-3574 (6th Cir. Nov. 5, 2013) (click here for a copy of the opinion), the Sixth Circuit found that whether an arbitration agreement provides for class arbitration is presumptively an issue for a court, not an arbitrator, to decide, unless the parties have clearly authorized the arbitrator to answer that question. To support its conclusion that classwide arbitrability is presumptively for a court to decide, the Sixth Circuit relied heavily on the Supreme Court’s characterizations in Concepcion and Stolt-Nielsen that bilateral and classwide arbitration are fundamentally different, and that “[a]rbitration is poorly suited to the higher stakes of class litigation.” The Sixth Circuit explained that gateway questions for courts “are fundamental to the manner in which the parties will resolve their dispute,” whereas disputes for arbitrators concern mere “details.” The Sixth Circuit reasoned that whether an arbitration proceeding involves 1 dispute or 1,000 disputes is “no mere detail,” and the availability of classwide arbitration is “vastly more consequential” than the classic gateway question whether two parties agreed to arbitrate. In sum, in the Sixth Circuit, a court presumptively will determine whether a contract provides for class arbitration.
The Sixth Circuit went on to find that the arbitration clause at issue, which was silent regarding class arbitration, did not authorize class arbitration.