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Henry Schein Inc. v. Archer and White Sales Inc. (2018)

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Supreme Court of the United States
Henry Schein Inc. v. Archer and White Sales Inc.
Term: 2018
Important Dates
Argument: October 29, 2018
Decided: January 8, 2019
Outcome
United States Court of Appeals for the 5th Circuit vacated and remanded
Vote
9-0
Majority
Chief Justice John G. Roberts • Anthony Kennedy • Clarence Thomas • Ruth Bader Ginsburg • Stephen Breyer • Samuel Alito • Sonia Sotomayor • Elena Kagan • Neil Gorsuch • Brett Kavanaugh

Henry Schein Inc. v. Archer and White Sales Inc. is a case that was argued before the Supreme Court of the United States on October 29, 2018, during the court's 2018-2019 term. The court vacated and remanded the ruling of the United States Court of Appeals for the 5th Circuit, holding that "the 'wholly groundless' exception to arbitrability is inconsistent with the Federal Arbitration Act and this Court’s precedent." The case came on a writ of certiorari to the United States Court of Appeals for the 5th Circuit.[1][2]

HIGHLIGHTS
  • The case: Archer & White Sales, Inc. filed a lawsuit against Henry Schein, Inc. alleging that the company violated the Sherman Antitrust Act and the Texas Free Enterprise and Antitrust Act. The district court held “that the dispute was not arbitrable because the plain language of the arbitration clause expressly excluded suits that involved requests for injunctive relief,” according to Oyez. The Fifth Circuit affirmed the district court’s order denying the motions to compel arbitration.[3]
  • The issue: Whether the Federal Arbitration Act permits a court to decline to enforce an agreement delegating questions of arbitrability to an arbitrator if the court concludes the claim of arbitrability is "wholly groundless."[4]
  • The outcome: The court vacated and remanded, holding that "the 'wholly groundless' exception to arbitrability is inconsistent with the Federal Arbitration Act and this Court’s precedent."


    • You can review the lower court's opinion here.[5]

    Timeline

    The following timeline details key events in this case:

    • January 8, 2019: U.S. Supreme Court vacated and remanded the case
    • October 29, 2018: Oral argument
    • June 25, 2018: U.S. Supreme Court agreed to hear case
    • March 9, 2018: Petition filed with U.S. Supreme Court
    • December 21, 2017: Fifth Circuit affirmed the district court’s order denying the motions to compel arbitration

    Background

    Archer & White Sales, Inc. filed a lawsuit against Henry Schein, Inc. alleging that the company violated the Sherman Antitrust Act and the Texas Free Enterprise and Antitrust Act.[5]

    A “magistrate judge held (1) the arbitration clause manifested an intent to have an arbitrator decide questions of arbitrability; (2) there is a reasonable construction of the arbitration clause that would call for arbitration in this dispute; and (3) the standard for determining whether equitable estoppel is appropriate requires arbitration against both signatories and non-signatories to the Dealer Agreement,” according to Oyez.[3]

    The district court vacated the magistrate judge’s order. The court held “that the dispute was not arbitrable because the plain language of the arbitration clause expressly excluded suits that involved requests for injunctive relief,” according to Oyez.[3]

    The Fifth Circuit affirmed the district court’s order denying the motions to compel arbitration.[5]

    Henry Schein, Inc. appealed to the U.S. Supreme Court, and the court agreed to hear the case on June 25, 2018.

    Question presented

    The petitioner presented the following question to the court:[4]

    Question presented:
    • Whether the Federal Arbitration Act permits a court to decline to enforce an agreement delegating questions of arbitrability to an arbitrator if the court concludes the claim of arbitrability is "wholly groundless."

    Audio

    • Audio of oral argument:[6]

    Transcript

    • Read the oral argument transcript here.

    Outcome

    Decision

    Justice Brett Kavanaugh, in his first opinion as a Supreme Court justice, delivered the unanimous opinion of the court. The court vacated and remanded the ruling of the Fifth Circuit, holding that "the 'wholly groundless' exception to arbitrability is inconsistent with the Federal Arbitration Act and this Court’s precedent. Under the Act, arbitration is a matter of contract, and courts must enforce arbitration contracts according to their terms."[2]

    Opinion

    In his opinion for the court, Justice Kavanaugh explained that the court decided that the “wholly groundless” exception is not consistent with the Federal Arbitration Act. He wrote,

    “ The Act does not contain a “wholly groundless” exception, and we are not at liberty to rewrite the statute passed by Congress and signed by the President. When the parties’ contract delegates the arbitrability question to an arbitrator, the courts must respect the parties’ decision as embodied in the contract.[7] ”

    Text of the opinion

    • Read the full opinion here.

    See also

    External links

    Footnotes

    1. ↑ Supreme Court of the United States, "Henry Schein Inc. v. Archer and White Sales Inc." accessed September 29, 2018
    2. ↑ 2.0 2.1 2.2 United States Supreme Court, "Henry Schein Inc. v. Archer and White Sales Inc." Opinion, January 8, 2019
    3. ↑ 3.0 3.1 3.2 'Oyez, "Henry Schein Inc. v. Archer and White Sales Inc." accessed October 1, 2018
    4. ↑ 4.0 4.1 Supreme Court of the United States, "17-1272 Henry Schein Inc. v. Archer and White Sales Inc." accessed September 29, 2018
    5. ↑ 5.0 5.1 5.2 SCOTUSblog, "Henry Schein Inc. v. Archer and White Sales Inc." accessed September 29, 2018
    6. ↑ Supreme Court of the United States, Henry Schein Inc. v. Archer and White Sales Inc. argued October 29, 2018
    7. ↑ Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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