Arbitrator Decides Class Action is Permitted

Release Date: 
June 10, 2013
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Oxford Health Plans, LLC v. Sutter, 12-135.  The Supreme Court unanimously held that a court may not, under §10(a)(4) of the Federal Arbitration Act, vacate an arbitrator’s finding that the parties’ contract is best interpreted as authorizing class arbitration.  The Court reasoned that §10(a)(4) authorizes a federal court to set aside an arbitral award only “where the arbitrator[] exceeded [his] powers,” not merely for “error ─ or even a serious error.”  Even if the arbitrator here erred in reading a run-of-the-mill arbitration clause as authorizing class proceedings, that merely amounts to the misinterpretation of a contract, not an action that “exceeds his powers.”

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