John G. Roberts, Jr.: We'll hear argument first today in Case 08-1198, Stolt-Nielsen S.A. v. AnimalFeeds International. Mr. Waxman.
Seth P. Waxman: Mr. Chief Justice, and may it please the Court: Unlike courts, arbitrators derive their authority solely from the consent of the parties to a particular agreement. That agreement determines not only what the parties have agreed to arbitrate, but just as fundamentally, with whom they have agreed to do so. And when the agreement reveals no intent, no meeting of the minds to add participants, but the arbitrators nonetheless extend their reach to hundreds of parties of other contracts, they violate the basic principle reflected in the FAA that their authority is created and circumscribed by an agreement. The decision to impose class proceedings is not the kind of incidental procedural matter that arbitrators have to resolve in order to discharge their responsibilities under the foundational agreement.
Ruth Bader Ginsburg: Mr. Waxman, there's a preliminary question in this case, and that is: There was one agreement, undoubtedly signed by both sides, and that was the one to submit to the arbitrator the question whether the arbitration clause permitted class treatment. The arbitrators answered that question, which they were given authority to do so by both sides, and the Second Circuit said that the arbitrators answered within the ballpark. If we agree with that, then there's nothing else to consider in this case.
Seth P. Waxman: I respectfully disagree, Justice Ginsburg. The arbitrators -- the agreement reflected in paragraph 7 of the supplemental agreement -- that is, to proceed to arbitration under the auspices of Rules 3 through 7 of the AAA rules, and Rule 3 itself contemplated precisely submitting precisely the contract issue that the Bazzle plurality said should go to the arbitrators. That is, looking at the arbitration clause itself, does it objectively reveal an agreement among the two parties to permit or prohibit class or consolidated treatment, or is it truly silent? That is a question of contract interpretation. That is the question that was submitted to the arbitrators. There is a separate statutory question that arises if the answer to the contract question is number 3. There is no meeting of the minds. It is truly silent--
Stephen G. Breyer: But there is no such answer.
Seth P. Waxman: --Excuse me.
Stephen G. Breyer: I thought, in contracts, there is no such answer. When you interpret a contract and it doesn't say, you try to figure out -- I used to be taught that; probably I am way out-of-date -- you try to figure out what a reasonable party would have intended.
Seth P. Waxman: Justice Breyer--
Stephen G. Breyer: And I thought that's what Bazzle said, that--
Seth P. Waxman: --I very -- I very much doubt that you are way out-of-date. If you are, I shudder to think where I am. But let me be clear--
Stephen G. Breyer: --Not as out-of-date. [Laughter]
Seth P. Waxman: --I hope I am as up-to-date as I need to be to provide a coherent, correct answer. My proposition is twofold, and only the second part gets to your question. The first is that the arbitrators in this case decided the contractual question, the -- did the parties have a meeting of the minds, yes or no? And if so, was it?
Stephen G. Breyer: Yes.
Seth P. Waxman: And the arbitrators then went on to say: Even though there is no meeting of the minds objectively revealed, nonetheless we are going to apply a background rule that puts the burden on the party opposing arbitration to prove that there is an intent to preclude. So, we're establishing that the--
Stephen G. Breyer: I see that now, but then -- but there are two separate questions.
Seth P. Waxman: --Exactly.
Stephen G. Breyer: My question was, first, the same as Justice Ginsburg.
Seth P. Waxman: And I have an answer--
Stephen G. Breyer: And I have a question for you on that, because in reading these briefs, I thought your description of who is to decide this matter of whether there is to be a class action was just what you said: The question of who should decide it is a matter for the parties.
Seth P. Waxman: --The question--
Stephen G. Breyer: So when I looked at -- I just have been reading Bazzle three, five times, and there seemed--
Seth P. Waxman: --Well, you are nowhere near up to me, then.
Stephen G. Breyer: --All right. But what it seems to say is that that's a matter to figure out from a contract and background circumstances. In Bazzle, the contract was: Any -- all disputes relating to this contract. Here, it doesn't say that. It says: "Any dispute arising from the performance, termination, or making of the contract. " Now, a class-action determination does relate to. Maybe it doesn't arise out of, okay? That's an argument.
Seth P. Waxman: Yes. No, no, no--
Stephen G. Breyer: So why are all these briefs saying that what Bazzle said was: Whenever this is silent, it goes to the arbitrator; the who question is answered at arbitration. I can't find it saying that.
Seth P. Waxman: --No, no, no. What -- and I -- I'm interpreting the plurality opinion that you wrote -- or you and three of your colleagues--
Stephen G. Breyer: Yes, I know. I know. But what I actually thought doesn't matter. What matters is what is said.
Seth P. Waxman: --Okay. Well, our understanding -- what Bazzle said is, at the very beginning of the opinion -- look, here's the case: The South Carolina Supreme Court found that the arbitration clause is truly silent, and it then applied a rule of State law that says, if it's silent, class treatment will be permitted. We granted certiorari in this case to decide whether that rule of South Carolina law applied to this case is precluded by the FAA, which requires actual consent, not coercion. Now, what the plurality in Bazzle, with respect, said is: We can't reach the legal question, the statutory FAA question on which we granted review, because we can't be certain that the contract really is silent. To be sure, there's no express provision, but Bazzle -- the Bazzle plaintiffs say that it is silent, and Green Tree says, no, if you look at other words in it, including the right to choose each arbitrator for each arbitration, it's not -- the South Carolina courts answered the question, but they are not the ones, because when you are talking about a question of the interpretation of a contract that has committed to arbitration, that is for the arbitrators to decide. The arbitrators have to decide whether there was actually a meeting of the minds.
Stephen G. Breyer: Now, you're -- so the answer to Justice Ginsburg's question is, as to the who question, who shall decide whether or not in your case class actions are permissible?
Seth P. Waxman: And the--
Stephen G. Breyer: The who question in Bazzle, because of the contract and background, was the arbitrator.
Seth P. Waxman: --If -- yes.
Stephen G. Breyer: The who question here, irrespective of the contract is the arbitrator for the reason that Justice Ginsburg said. There's a separate saying: You are the who; you, arbitrators, are the who.
Seth P. Waxman: Yes.
Stephen G. Breyer: So now we look to the what. They then decided it.
Seth P. Waxman: Exactly. So in Bazzle--
Stephen G. Breyer: What -- what did they decide? And you are saying that's wrong. And there you run into all the authority, Misco, who used to be in other places, saying when the arbitrator says something, unless it's in Marrs, follow it. That's what you are addressing.
Seth P. Waxman: --Right. Exactly. And -- and this case presents exactly the same answer to that question that Bazzle presented when it was granted review; that is, there is -- there was an interpretation of the contract in Bazzle, and an application of a legal principle to that interpretation. The who for what -- what the parties actually intended is the arbitrator. That's what the Bazzle plurality, together with Justice Stevens, both decided. The question that arises, the legal question that arises, only if the arbitrators say there was no meeting of the minds: So what rule does the FAA allow us to apply as a matter of Federal law? That is for courts, and you didn't reach it because the preliminary question of whether the contract was really silent, the predicate question, wasn't answered. And you remanded for that--
John Paul Stevens: Mr. Waxman, can I ask this preliminary question? Assume the contract expressly authorized class arbitration. Would you agree that was permissible?
Seth P. Waxman: --If it expressly authorized it?
John Paul Stevens: Yes.
Seth P. Waxman: If it expressly authorized class participation, obviously, we would have no argument that the parties had not agreed to it.
John Paul Stevens: I understand, but would you agree that would be consistent with the law, to enforce such a provision?
Seth P. Waxman: My -- I have a--
John Paul Stevens: That is, does the Federal statute prohibit that kind of provision?
Seth P. Waxman: --No, certainly not.
John Paul Stevens: Oh.
Seth P. Waxman: I mean, the only reason -- the only reason I'm hedging -- and I don't mean to hedge, but trying to be thoughtful -- is that this Court explained in Mitsubishi, in the context of the arbitration of a Sherman Act agreement, and subsequently in Gilmer and other statutory cases, that in determining whether class participation or some other form of remedy is or isn't available, there is a two-part inquiry. The first part is: What was the scope of the arbitration agreement? What is it that the parties have agreed--
John Paul Stevens: And you would agree that if they phrased their order a little differently and said we think that the best reading of this agreement is that the parties intended to authorize class arbitration, then you would have no case?
Seth P. Waxman: --Then we would have review only under the -- I don't know that I would characterize it this way, but what Justice Breyer characterized, the Marrs standard of review; that is, you would have to show--
John Paul Stevens: That there was manifest disregard--
Seth P. Waxman: --manifest disregard, and a manifest--
John Paul Stevens: --And you would not contend -- you are not arguing that that would be manifest--
Seth P. Waxman: --No, our -- and the petition in this case presented the question as given, presented the issue of contract construction as given, that the contract itself was silent, not only in the sense that it didn't include an express provision or prohibition, but also that it reflected no meeting of the minds. It objectively revealed no meeting of the minds, looking not only at the actual text of the contract, but also looking at the other indicia -- objective indicia of intent that courts use to--
John Paul Stevens: --What, in your view -- what, in your view, were the arbitrators asked to decide by the submission by the parties?
Seth P. Waxman: --The arbitrators were asked to decide whether the arbitration agreement objectively reveals consent to prohibit, permit -- whether it reveals a meeting of the minds to prohibit class treatment, permit class treatment, or whether it was truly silent.
Speaker: Didn't you just--
Seth P. Waxman: And if you look at--
Speaker: --Didn't you just say that the parties agreed that there was no meeting of the minds on this issue?
Seth P. Waxman: --Well, no, no, no. The parties that -- I mean -- we actually -- let me step back and give -- and give the history of it. This case arose immediately in the wake of Bazzle. Okay? They sued in court; we obtained an order affirmed by the Second Circuit sending them to arbitration. Bazzle is decided, and we're all looking at Bazzle, and we decide -- like the AAA, which has filed an amicus brief in this case, and said it drafted these rules in order to provide a procedure to answer the Bazzle contract interpretation question; the AAA says, we don't have any view about the statutory question that arises from silence -- so we drafted a supplemental agreement that, in paragraph 7, incorporates the AAA Rules 3 through 7. And the AAA Rule 3, which is included on page 56 of the joint appendix, is headed "Construction of the Arbitration Clause". And it requires the arbitrators in this arbitration to determine, quote, "on construction of the arbitration clause, whether the applicable arbitration clause permits the arbitration to proceed on behalf of or against a class. " The, quote, "clause construction award". Now, the legal -- the arbitrators in this case concluded that it neither permitted nor prohibited, either by its express terms or by reference to other objective indicia of intent--
John Paul Stevens: I'm a little bit puzzled. I don't understand how something -- if you ask whether something permits it, and if it doesn't prohibit it, doesn't it a fortiori permit it?
Seth P. Waxman: --It -- in the context of the Federal Arbitration Act, which this Court has made clear more times than I can remember that the central purpose is to ensure that private agreements to arbitrate are enforced according to their terms, the question is: Have the parties agreed to it if there is a meeting of the minds? If no meeting of the minds is objectively revealed, under the FAA, the arbitrator exceeds his authority in requiring class arbitration. It's -- there is no consent. And if there is no consent, the legal rule under -- the hallmark principle of the FAA is this is a private consensual matter. This is not a court exercising public coercive authority. I mean, the--
Speaker: What is your understanding of what Mr. Persky says at 77a of the joint appendix? He was -- I take it he was counsel for AnimalFeeds? Is that right?
Seth P. Waxman: --Correct. He--
Speaker: And he says all the parties agree that when a contract is silent on an issue, there has been no agreement that has been reached on that issue; therefore, there has been no agreement to bar class arbitrations.
Seth P. Waxman: --Right. I--
Speaker: So then I don't understand what issue there was for the arbitrator to -- arbitrators to decide--
Seth P. Waxman: --They--
Speaker: --other than to impose a rule like the rule that had been adopted by South Carolina. But that would not be within their power, unless they could presumably find that rule in Federal maritime law or New York law.
Seth P. Waxman: --Correct. I mean--
Speaker: So what was the issue for them to decide?
Seth P. Waxman: --So here's was -- here's what the issue was. They said the contract is completely silent and, as you quoted on page 77, the part -- there's no meeting of the minds on this issue at all. That was their position about the construction of the contract. Our position about the construction of the contract was that, in fact, although there is no express provision one way or the other, this is a maritime contract, and the -- and maritime law is ascertained by custom and practice. And we introduced evidence in the form of affidavits that were unrefuted that since the days of Marco Polo, these types of spot voyages have been--
Stephen G. Breyer: That -- isn't that -- you and I have a contract. I'll ship you 17 pounds of durum wheat, and you will pay me $43. In the meantime, a green worm eats up all the durum wheat, and therefore they can't send durum wheat; they send some duhu wheat. All right? Question: Is the contract valid or not?
Seth P. Waxman: --I don't owe you.
Stephen G. Breyer: Answer: We have courts for that purpose. We have arbitrators for that purpose.
Seth P. Waxman: Exactly.
Stephen G. Breyer: Arbitrators will look to see what it says. If it says nothing, they will try to determine what the parties thought. If they can't determine what they thought, they will look to custom, analogy, et cetera. Now--
Seth P. Waxman: No.
Stephen G. Breyer: --They won't?
Seth P. Waxman: In -- in the -- in the context of -- in the context of a court that has jurisdiction over a dispute and exercises coercive power, it has to get to an answer. When you are talking about private arbitration, where the model is a private agreement to resolve things between two parties, this -- under the FAA, the arbitrators get their authority only as to matters as to which there is consent. And there is -- going to Justice Alito's question, there was consent. It was submitted for purpose of determining whether -- if you look at the contract and look at background rules and look at parol evidence and look at custom and practice, can you discern whether, as -- as you put it in -- in the opinion in Howsam, Justice Breyer, whether the contract, quote, "objectively reveals an agreement" by the two parties.
Antonin Scalia: But that's the same before courts. That's no different. I mean, yes, a court has to come to a decision, but so does an arbitrator. And I really -- I really don't understand what it means to say that the contract does not cover it. I mean, the -- the contract either requires it or does not require it. And if the contract is silent, either the court or the arbitrator has to decide what is the consequence of that silence, in light of the background, in light of -- of implied understandings. Is the consequence of the -- of the silence that a class arbitration is permitted, or is the consequence of the silence that it is not? But those are the only answers. The contract requires it or the contract doesn't require it. I don't know anything in between -- the contract is silent. If the contract is silent, it's up to the court or the arbitrator to decide what that silence means.
Seth P. Waxman: Exactly. And -- and maybe the ambiguity here is the fluidity of the term "silence". "Silence" can mean there's no express provision. "Silence" could also mean, well, if you look at other words in the text of the contract, you can't work your way through to conclude that there was in fact an intent. It also may mean -- and this is the sense that I am using it in, and I think the sense that the arbitrators have authority to do, is to say, well, let's look and see, for example, if there is custom and practice that would inform the backdrop against which the parties negotiate--
Anthony M. Kennedy: And -- and why is it that you say an arbitrator cannot do that, but a judge can?
Seth P. Waxman: --No, no, no, I think an arbitrator can. The arbitrator has plenary authority, subject to manifest disregard review, to decide whether or not there was a meeting of the minds of the parties. And it can use the text of the statute; it can use an applicable background principle of governing law; it can use principles like contra proferentem, as this Court did in--
Anthony M. Kennedy: But are they situated and do they have the same authority as a court would in determining that issue, given the fact that it was remitted to them to decide?
Seth P. Waxman: --They have plenary authority to apply rules of construction that go to the parties' intent, that go to whether there is -- possible to discern a meeting of the minds. They don't have--
Anthony M. Kennedy: And you would -- would you describe -- would you describe the authority of a court any differently than you've just described the authority of an arbitrator?
Seth P. Waxman: --Well, I think that courts can -- for example, a court can say -- and the other side relies heavily on a Seventh Circuit opinion by Judge Posner, where he basically says: There is no intent here, but courts apply contract constructions that seem most sensible as a matter of public policy, and that's what we are going to do. That's what a court can do and an arbitrator can't. The arbitrator can use any tools possible, including, largely, the text and custom and practice, in order to define whether or not there was a meeting of the minds. But if there wasn't--
Antonin Scalia: Do I have to agree with Judge Posner on that? I mean I -- I don't--
Seth P. Waxman: --I think it's a radical proposition--
Antonin Scalia: --You would -- yes, you--
Seth P. Waxman: --as a matter of what courts can do, but it certainly doesn't express what an arbitrator can do. And he was -- he was performing the kind of function, ostensibly, that you said that should be done by an arbitrator in Bazzle. He was doing it as a court. But arbitrators have to construe the agreement itself between the two parties to see if there is a meeting of the minds. And there are lots of tools they can use. And just to get back to your question, Justice Alito--
Antonin Scalia: --But--
Seth P. Waxman: --I'm sorry -- in this case, we said the contract was not truly silent, that -- essentially, we argued what Judge Rakoff concluded. They said: No, no, no; it is truly silent, but you should rule for us on other grounds. And may I please ask the Court, if you have it, to turn to page 22 of our blue brief, because on page 22 of our blue brief we have reprinted exactly what AnimalFeeds told the arbitrators were the reasons why they should win, in light of Mr. Persky's statement that there was no meeting of the minds. And it is the indented paragraph. This is all that they said: "The parties' arbitration clause should be construed to allow class arbitration because (a) the clause is silent on the issue of class treatment, and without express prohibition, class arbitration is permitted under Bazzle. " The arbitrator said: No, that's not what Bazzle means. Bazzle doesn't mean that unless there's an express prohibition, it's -- it's permitted. So that was their reason number one. Let's go to their reason number 3.
Ruth Bader Ginsburg: Where did the arbitrators say that?
Seth P. Waxman: They said it in -- pardon me while I get the page. Page 49a: "Claimants argue that Bazzle requires clear language that forbids class arbitration in order to bar a class action. " "The panel, however, agrees with Respondents that the test is a more general one. " "Arbitrators must look to the language of the parties' agreement to ascertain the parties' intention, whether they intended to permit or to preclude class arbitration. " Now, let's go back to what they told the arbitrators, and it's reprinted on page 22. I am going to skip--
John Paul Stevens: But let me just, right there, interrupt with one question. The alternatives before the arbitrator were whether it is permitted or precluded?
Seth P. Waxman: --Or was silent.
John Paul Stevens: No, that's not what they said there, is it? That -- that the parties agree they're silent -- that whether they -- if they are silent, whether they permit or preclude class action. Those are the two alternatives that they were confronted with. They decided that it did not preclude; ergo, it permitted.
Seth P. Waxman: Well--
John Paul Stevens: That's what the answer to that on page 49a is.
Seth P. Waxman: --No, with -- with respect -- and I'll -- let me answer this question--
John Paul Stevens: You--
Seth P. Waxman: --before getting back to the -- what that -- what -- look, you -- you may find, contrary to the cert grant in this case, that the predicate of our petition is wrong. Our petition is predicated on the understanding that the arbitrators found that the contract was truly silent; that is, it expressed no meeting of the minds. And, therefore, this case presents the question--
John Paul Stevens: --But the question you were asked was whether that silence should be interpreted as a preclusion or a permission.
Seth P. Waxman: --And we know from the arbitrators' decision--
John Paul Stevens: You said there was a permission.
Seth P. Waxman: --As -- as a background rule, that's what they said. What they said was, they -- first of all -- and we are looking at page 52 -- they acknowledge the force of the argument, quote, "that the bulk of international shippers would never intend to have their disputes decided in a class arbitration. " But they said, well, we can deal with that later in deciding whether they can opt in or out. I mean, the point is that if you have to opt in because it's clear that you never agreed, there is no meeting of the minds. Secondly--
Ruth Bader Ginsburg: Mr. Waxman, may I ask you -- because your time is running and we are spending all of your time on this preliminary question. There is one fundamental flaw, it seems to me, in your argument, and I'd like you to answer it. And you can call it "the vanishing class action". AnimalFeeds wanted to be in court, not in arbitration.
Seth P. Waxman: --Yes.
Ruth Bader Ginsburg: You said -- and they wanted to bring a class action. You persuaded the Second Circuit they belong in arbitration. So now they are in arbitration. You say: The only thing we consented to is a one-on-one claim. Fine. AnimalFeeds can then say: Fine, well, we didn't consent to anything more than the one-on-one. We had a class action. We had -- we were in court. We could have proceeded in an individual action or a class action. Now we are in arbitration, and under the agreement, as you read it, we can't have the class action in arbitration. That doesn't mean it vanishes, because if it does, then the arbitration clause is not merely saying what the arbitrator can decide, but it is shrinking drastically the dimensions of AnimalFeeds' claim.
Seth P. Waxman: That is incorrect, with respect. AnimalFeeds doesn't have a class claim. AnimalFeeds has a claim. Its claim is that it paid too much for the contracts that it entered into -- the charter parties -- to ship some sort of oil from Panama to ports around the world. It is -- it was asking a court, and is now asking an arbitrator, to join in the separate claims that other parties to other contracts with other terms--
Ruth Bader Ginsburg: But that's what it was doing in court.
Seth P. Waxman: --Exactly. And--
Ruth Bader Ginsburg: And -- and the court said this goes to arbitration. What is the "this"? If it's only a one-on-one claim, how do they lose the larger claim that they had in court?
Seth P. Waxman: --It's -- you know, that argument -- in the JLM case, which is the case in which the Second Circuit, the district court in the Second Circuit said, no, you have to arbitrate this -- their briefs actually made this point. Their briefs said you can't send us to arbitration, because we won't get class treatment in arbitration. And the Second -- the district court in the Second Circuit said you have got to arbitrate according to the terms of your agreement. In footnote 9 of the Second Circuit's opinion--
Ruth Bader Ginsburg: But they never -- they never gave up.
Seth P. Waxman: --They never--
Ruth Bader Ginsburg: If -- if the -- if you would regard arbitration as a change in forum, like a forum selection clause, it says where you go, but it doesn't change, if you have to go to another forum, what your claim is.
Seth P. Waxman: --Their claim was we paid too much. And with respect, Justice Ginsburg, your point that they aren't allowed to proceed in class arbitration is no different than the fact that by agreeing to arbitrate this bilateral dispute, the parties agreed to dispense with an appeal and with meaningful judicial review of the things the arbitrators decided.
Antonin Scalia: --Mr. Waxman, I hope you are going to have time to go through (a), (b), and (c)--
Seth P. Waxman: I--
Antonin Scalia: --as you started to do.
Seth P. Waxman: --I will.
Antonin Scalia: Thank you.
Seth P. Waxman: I -- I was hoping to reserve a few minutes for rebuttal, but nothing is more important than--
Antonin Scalia: Yes, I bet you were thinking you'd be able to.
Seth P. Waxman: --than answering the Court's questions. So I think we have dealt with (a). They -- they said (a) we win because Bazzle requires it. The arbitrators correctly said no. I want to skip (b), because my submission is that (b) is what they did. (C) says the clause would be unconscionable and unenforceable if it forbade class arbitration. The panel said: We aren't reaching that; we are not deciding that question. So what's left? The only other argument that AnimalFeeds made was (b): The clause should be construed to permit class arbitration as a matter of public policy. And that is exactly what the arbitrators did. What they said was -- and this is on page 51 of the petition appendix -- they said that if they followed a strict contractual theory, quote, "There would appear to be no basis for a class action, absent express agreement among all parties and putative class members. " And they then, lower down on the page, then said that we were required to prove that the parties, quote, "intended to preclude arbitration". That is, they applied a background rule that they thought was desirable from a public policy sense. And our sole submission here, the only question presented in this case, is that that decision is not -- is precluded by the Federal Arbitration Act, which requires that contracts to arbitrate be construed only in accordance with their terms and what the parties agreed with. And section 4 of the Arbitration Act couldn't be clearer that they -- they can only proceed, quote, "in accordance with the terms of their agreement. " May I reserve the balance of my time?
John G. Roberts, Jr.: Thank you. Ms. Pillard.
Cornelia Tl Pillard: Thank you, Mr. Chief Justice, and may it please the Court: What the arbitrators did here was interpret the contract as the parties asked them to. They did not impose their own policy judgment. And any judicial review is under very deferential FAA standards under section 10, which is confined to correcting what amount to gross defects in the process.
Antonin Scalia: Where -- where -- where do they say that they were interpreting the intent of the parties, that it was the intent of the parties to permit class arbitration?
Cornelia Tl Pillard: Okay. Petitioners' position rests on a misinterpretation of what the arbitrators did. And if you look at page 59 of the petition appendix, Mr. Waxman already read to you the language that the arbitrators understood they must look to the language of the parties' agreement to ascertain the parties' intention. And then the next key part is on page 50a, which is a little terse, but let's say--
Antonin Scalia: --Excuse me, what part -- 50?
Cornelia Tl Pillard: --50a, the next page of the petition appendix.
Antonin Scalia: I thought you said 59a to start.
Cornelia Tl Pillard: No.
Antonin Scalia: You said 49a.
Cornelia Tl Pillard: 49a was where--
Antonin Scalia: Right.
Cornelia Tl Pillard: --the arbitrators described their methodology, which is standard contract methodology: To look to the parties' agreement, to ascertain the parties' intention, whether they intended to permit--
Antonin Scalia: Or to preclude.
Cornelia Tl Pillard: --or preclude--
Antonin Scalia: Right.
Cornelia Tl Pillard: --class action. So they have set up--
John G. Roberts, Jr.: Isn't that a critical difference, though? I mean, I understood the fundamental question in -- before getting arbitration is whether the parties have agreed to arbitrate this dispute with this party. And it's one thing to say that the contract permitted this sort of arbitration; it's another thing to say it didn't preclude it.
Cornelia Tl Pillard: --That's right.
John G. Roberts, Jr.: And if it didn't preclude, the contract may not preclude -- if I agree -- I guess it's the -- well, if I agree to arbitrate with A, it doesn't preclude me from arbitrating with B, but nothing in the agreement compels me to do that. So which did the arbitrators do? Did they say, under this contract, you agreed to a class action treatment, in the sense that -- whether it's the language or the intent or whatever -- or did they say we don't find anything here that precludes class action treatment?
Cornelia Tl Pillard: Mr. Chief Justice, they did the former. And let me point you to -- on page 50, what they relied on was the broad language of the agreement, the language "any disputes". And in particular, they drew on the breadth of that language and on the fact that many other arbitrators had read similar language to permit class arbitration. And so those other--
John G. Roberts, Jr.: Would you show me this -- I see they have quoted from--
Cornelia Tl Pillard: --Yes.
John G. Roberts, Jr.: --from the agreement. Where is that in the agreement itself?
Cornelia Tl Pillard: The "any disputes"--
John G. Roberts, Jr.: Yes.
Cornelia Tl Pillard: --language? In the agreement itself?
John G. Roberts, Jr.: If you know offhand.
Cornelia Tl Pillard: Is -- the agreement is reproduced in Appendix F of the petition appendix, which starts on page 67a, and the arbitration clause is on page 69a. Now, it's clear that the arbitrators rejected the notion that they should permit--
John G. Roberts, Jr.: Well, this is -- I'm sorry. This is what I was wondering. It is, of course, any dispute arising from -- blah, blah -- performance, termination of this charter party shall be settled in New York. Now, there's -- the class is not a party to this charter party. So disputes arising from this charter party doesn't involve the class. So they did not agree to arbitrate with the class. Now, as I understand what the arbitrators did, they said, well, they didn't preclude it, and so we get to decide how far our authority goes.
Cornelia Tl Pillard: --I'd like to address that directly, Mr. Chief Justice. The arbitrators specifically rejected the notion that they should adopt as -- as a default rule. And that's on page 49a. Where we had actually argued that they should, they rejected our argument. Claimants argue that Bazzle requires clear language that forbids class arbitration in order to bar it; the panel, however, agrees with Respondent. So they are saying: We are not going to do this based on a default rule; we are going to do this based on the language and intent. Right?
John G. Roberts, Jr.: Well, now -- now -- I'm sorry. I'm just reading along here. They rejected your argument about "forbids", but the -- they go on to say: The issue -- we look at this, we look at that to see whether they intended to permit or to preclude class action.
Cornelia Tl Pillard: Right.
John G. Roberts, Jr.: So it's enough for them if the parties did not intend to preclude class action.
Cornelia Tl Pillard: I -- I respectfully disagree. They go on and they read any disputes to authorize -- now, it's not to require class action. I think it's important that that be clear. It's to put the class action mechanism -- or, to read the contract, that the class action mechanism is in the arbitrators' toolbox. It's something that's available. It's not necessarily going to happen, but it's something that's available. So it's part of a delegation to the arbitrators of authority to choose procedures. Now--
John G. Roberts, Jr.: In -- in any -- in any case -- when you say "arbitrators' toolbox", I'm trying to figure out if that is something different than what the parties agreed to.
Cornelia Tl Pillard: --No, by agreeing to arbitrate any disputes, the arbitrators found that they were given the authority to use class arbitration, among other procedures, if they were appropriate in the particular case.
Antonin Scalia: It -- it seems to me that the arbitrators are putting the choice in a false manner. It isn't whether, on the one hand, they agreed to permit it or, on the other hand, they agreed to prohibit it. Just forget about the latter. They must have agreed to permit it. Where did the arbitrators say they agreed -- they agreed to permit it? Not simply, they did not agree to prohibit it. You don't have to agree to prohibit everything in a contract. You have to agree to permit it. That's what contracting is about.
Cornelia Tl Pillard: That's right. I'd like to point to two aspects of the opinion that I think clarify this. The one is their reference to the language on page 50a, the panel is -- and they are talking about the language in the context of the other arbitration precedent, or the other arbitration opinions that had developed at that point under the AAA arbitration scheme. And they are saying the -- they find that the broad wording "any dispute" to be significant, and the fact that other arbitrators looking at that language also found "any dispute" to encompass the choice of this procedure. Now, I think it was Justice Alito--
Antonin Scalia: Well, no, I mean, they -- they put it just -- just the way that -- that is not good for you. "The panel is struck by the fact that Respondents have been unable to cite any post-Bazzle panels or arbitrators that construed their clauses as prohibiting a class action. " That's not what -- what they have to find. They must find positively that it permits a class action.
Cornelia Tl Pillard: --And it's our contention -- and I think it's clear -- that they found that it was permitted. And when you see that following--
Antonin Scalia: Just give me some language that says that. I -- there is nothing in that paragraph that says it.
Cornelia Tl Pillard: --The -- the broad wording, the "any dispute" -- now, they reject the notion -- they expressly have rejected the notion that they are supposed to do it as a matter of default. And then I just want to address this language, which I think could be confusing, at the bottom of 51a, where they say they don't establish that the parties -- this is the last paragraph on 51a: The Respondents' evidence "does not establish that the parties intended to preclude class arbitration. " You might read that as supporting the argument that you are proffering. However, I believe that the arbitrators meant that, that once they had established under the "any disputes" language that there was affirmative general authorization on the part of the arbitrators to choose any procedures, to have this in their toolbox, then in order to overcome that, you would need to -- and the Petitioners were trying with their maritime experts -- to show an intent to preclude.
Antonin Scalia: So the only language you can point to is that -- is that 50a?
Cornelia Tl Pillard: That's right, and I think that's very important.
Antonin Scalia: You are hanging your whole -- your whole assertion that -- that these arbitrators not only found that the contract did not prohibit it, but found that the contract positively authorized class action, upon that language on 50a?
Cornelia Tl Pillard: Together with the language on 49a where the panel expressly rejects the idea that all you need is the absence of language forbidding it. Right? So they've already -- they've set the issue up exactly as you -- your hypothetical would require them to. They've said: It's not enough to find--
Antonin Scalia: Where -- where--
Cornelia Tl Pillard: --It's on 49a, the second sentence under the heading of "Discussion of Parties' Contentions". They say, "Claimants argue that Bazzle requires clear language that forbids class arbitration. "
Antonin Scalia: --"Clear language" is the point of that sentence. "Claimants argue that Bazzle requires clear language that forbids class arbitration. " "The panel, however, agrees with Respondents that the test is a more general one. " "Arbitrators must look to the language to ascertain the parties' intention whether they intended to permit or to preclude class action. "
Cornelia Tl Pillard: I would--
Antonin Scalia: The point of those two sentences is simply that in order for us to find that you didn't preclude it -- and if you didn't preclude it, it's okay -- you don't need clear language. We have to look to everything.
Cornelia Tl Pillard: --I -- I respectfully disagree, Justice Scalia--
Antonin Scalia: Well, that's how I read the two sentences.
Cornelia Tl Pillard: --But I think that what's very important here is that judicial review is under a very deferential standard, which is confined to correcting--
John G. Roberts, Jr.: Well, that's just saying that they're -- they're giving up a lot. This is the basic reason that you require, I thought, fairly clear language that you are agreeing to arbitrate. They are giving up their right to go into court. They have an agreement between A and B that they will arbitrate a dispute, and they say you are giving up your right to go to court with the dispute between A and C. And the "any dispute" language that you're, you know, quite understandably relying on refers to any dispute arising from the -- making performance or termination of "this charter party". "This charter party" says nothing about arbitrating with C.
Cornelia Tl Pillard: --No, but this charter party is the same agreement that the Petitioners have with every absent class member. We wouldn't be here if every--
John G. Roberts, Jr.: Oh, but they can agree to arbitrate. They can agree to arbitrate with some and not with others, even if it's the same contract. They may decide that your client is a very reasonable person; they are happy to submit that to arbitration. Or it's a very big and important client, and they don't want to get into court with you. They may decide some other party, for whatever reason, they don't want to get dragged into court with them. Same charter party, different -- different parties--
Cornelia Tl Pillard: --But they've--
John G. Roberts, Jr.: --and different results.
Cornelia Tl Pillard: --Excuse me, Mr. Chief Justice.
John G. Roberts, Jr.: Go ahead.
Cornelia Tl Pillard: They've already entered into agreement. They've already said they are going to arbitrate with the absent class members, so everybody has the same contract that says "any disputes", and the question is: Do the arbitrators, under that broad language, have the authority? And I would point this Court to the -- this Court's decision in Mastrobuono, which read a clause requiring arbitration of any controversy to empower arbitrators to award punitive damages, and that was despite established New York State law to the contrary.
Stephen G. Breyer: That's where I started this. We don't get many contract interpretation cases, and that's why I -- I needed to go back to Jack Dawson, who is a great contracts professor. And I am--
Antonin Scalia: I used to teach contracts. Did you know that?
Stephen G. Breyer: --What?
Antonin Scalia: I used to teach contracts.
Stephen G. Breyer: I didn't have that pleasure, but the-- [Laughter] The -- but the -- as I recall, the way I would have interpreted -- imagine a worker who says: I have a right, permission -- it's permissible for me to eat lunch next to the machine. The employer says no. The question was what is -- does the contract permit this or not? So the arbitrator or the judge reads the words. Nothing. They have no idea. Then the judge or the arbitrator reads the rest of the contract. Hasn't a clue. Then the arbitrator or the judge goes and looks and sees what's practice around here? "I don't know". Then they might look to what happens in the rest of the industry. Then they might look to what happens in foreign countries with comparable industries. Then they might look to public policy. They might look almost to anything under the sun they think is relevant, and the way, in jargon, you describe the bottom line is: They have found a meeting of the minds as to what this means. Now, of course, it isn't really a meeting of the minds. But that's just the summary of the conclusion as to what, objectively read, those words in the contract mean. Now, that's how I think I would have learned it. Is that still done, or is there some other way of describing it?
Cornelia Tl Pillard: I think that's pretty good contract law.
Stephen G. Breyer: If that's contract law--
Cornelia Tl Pillard: And that's the way I understand it.
Stephen G. Breyer: --then I take it what they're saying is: It may be true that the arbitrators, when they looked at some of those elements, really got it wrong. Now, if they are correct on that -- this is the other question I have. You are going to say: No, they're not -- they didn't get it that wrong; wrong, maybe, but not that wrong. All right. Now, can they not do this? The next person who has this form contract does not so readily agree it's up to the arbitrator to say whether that contains a class action or not. Rather, they say: I read this contract as reserving that question to the court. It's not the same language as was there in Bazzle; it's not the same industry of the kind you had in Bazzle; and, therefore, a judge should decide that. That's the meeting of the minds on the who question. And then we'll get it all resolved, because the judge might come out differently if they're right, and maybe arbitrators will follow the judge. I'm interested, because we might have to write something, in your answer to that question.
Cornelia Tl Pillard: I think that if they wanted to write around it, they could do that, as this Court--
Stephen G. Breyer: Not -- we know they're going to -- they have something already in place.
Cornelia Tl Pillard: --Could it be interpreted to say--
Stephen G. Breyer: Yes.
Cornelia Tl Pillard: --this is a question for the court?
Stephen G. Breyer: Uh-huh.
Cornelia Tl Pillard: I think -- I don't see the language here in this contract, but they could try to do that. There's nothing in the FAA that bars it. And, you know, as we've emphasized, the contract interpretation, under ordinary contract rules that the FAA has consistently applied in -- and this Court has consistently applied to the FAA in -- in many, many cases -- it's ordinary contract law we're talking about here. Now, I just think one thing -- when we are thinking about contract law, which is ordinarily in the province of the States, I think it's important that the New York Appellate Division, in Cheng v. Oxford Health Plans, has since approved just such an arbitrator's contract interpretation under New York law, allowing class arbitration under a 1998 pre-Bazzle clause--
John G. Roberts, Jr.: Allowing.
Cornelia Tl Pillard: --like this one.
John G. Roberts, Jr.: Allowing. See, that's where I get hung up. There's a difference in arbitration -- and it's a fundamental difference -- between allowing something and a background rule that requires it if you don't say anything about it. The difference I see with the hypothetical Justice Breyer put is that you are talking about the details of a contract once it's agreed there is a contract. There's a contract that governs the relationship between the employer and the employee, and you're trying to figure out if it says anything about where they eat lunch. This is the much more fundamental issue of whether you've even agreed to arbitrate with this person. Is this guy your employee or just somebody who came in off the street? And I think what your brother's position is, is that this is just somebody who came off the street; the class members. I didn't agree to do anything with them.
Cornelia Tl Pillard: Well, I think, Mr. Chief Justice, that that goes back to whether any disputes can plausibly be read to encompass the class mechanism, because if it can, well, then, by agreeing to that contract, you have, in effect, agreed to something that delegates to the arbitrator the ability to use that.
John G. Roberts, Jr.: So--
Cornelia Tl Pillard: So when you picked--
John G. Roberts, Jr.: --I -- I--
Cornelia Tl Pillard: --your arbitrator you picked your arbitrator knowing that. And here, they had extra notice, right, because this case had been filed in court as a class action? They knew when they picked these arbitrators -- and you can tell by the caliber of arbitrators they picked -- that they knew this could be a class arbitration, and so they are picking people who are up to that task. Now, they also know that they are going to dispute that, but if we're right that the arbitrators, plausibly and under the -- the Marrs standard of judicial review, have -- have sustainably interpreted this contract to give the arbitrators the authority to proceed on a class basis, well, then, I think your objection--
John G. Roberts, Jr.: --Well, that's -- that's what it comes down--
Cornelia Tl Pillard: --Mr. Chief Justice, disappears.
John G. Roberts, Jr.: --That's what it comes down to--
Cornelia Tl Pillard: Right.
John G. Roberts, Jr.: --whether it's an interpretation of the contract to give the arbitrators the authority to proceed on a class basis. Not enough, right, under your view, if there's nothing in there that precludes them from doing so?
Cornelia Tl Pillard: I think that's a question of State law. For example, under the State law at the time in South Carolina, what the South Carolina Supreme Court found in Bazzle was that the contract was silent, but the -- applying two rules of contract construction, contra proferentem -- well, one rule of contract construction and one FAA rule, which is the Moses H. Cone rule, the court said: We find this contract authorizes it. Right? So there was contra proferentem. There was also, which I haven't mentioned and I should, the Moses H. Cone rule, which says when there's any ambiguity about the scope of issues that have been given to the arbitrator, we put a finger on the scale in favor of giving the issue to the arbitrator. So if it's unclear, any disputes, well, maybe that only is about contract issues, where the court in JLM said, no, it's antitrust, too--
John G. Roberts, Jr.: So what -- what happens--
Cornelia Tl Pillard: --and the arbitrators say procedure, too.
John G. Roberts, Jr.: --What happens if you get the arbitrator on the stand, and he says: As we read the contract, it doesn't say -- and nothing about the intent of the parties leads me to believe they meant -- you may arbitrate this on a class basis, but at the same time there is nothing in there that says you may not. And I looked at the intent of the parties and background rules, and nothing there says you may not. What do you understand to be the answer? Can they proceed on a class basis or not?
Cornelia Tl Pillard: I understand that to be something that's answered by State contract law--
John G. Roberts, Jr.: Yes.
Cornelia Tl Pillard: --and it might differ from State to State.
John G. Roberts, Jr.: Right. It's the background rule--
Cornelia Tl Pillard: Right.
John G. Roberts, Jr.: --under which you should interpret this.
Cornelia Tl Pillard: Right.
John G. Roberts, Jr.: So we have to decide, when we -- when the contract says nothing about class actions, whether the background rule should be you can go ahead -- or the background rule should be you can't go ahead.
Cornelia Tl Pillard: We, the arbitrators, decide that--
John G. Roberts, Jr.: Well--
Cornelia Tl Pillard: --not we, the United States Supreme Court. It's a question of State contract law.
John G. Roberts, Jr.: --What the arbitrators have already told us -- I think you disagree with it--
Cornelia Tl Pillard: Yes.
John G. Roberts, Jr.: --but take it for purposes of argument. What the arbitrators have told us is that it doesn't say anything. It doesn't say you can do it, it doesn't say you can't do it. I assume that's true.
John Paul Stevens: You don't agree with that, do you?
John G. Roberts, Jr.: No, I know I said she doesn't agree with it. But, I mean, assuming that's true, what's the answer? Yes or no? Can they go ahead with class action or not?
Cornelia Tl Pillard: They -- in my view, haven't answered that -- well, maybe they answered that question under New York law. They have answered the New York contract law question that was put to them. I think they tee it up in a way that Mr. Waxman and I agree is a valid statement of New York contract law, which is on page 49. We look to the parties' intent and the language to ascertain whether they would permit or preclude--
John Paul Stevens: Would you help me with one--
Cornelia Tl Pillard: And if they have applied that and they have found yes, I think we have to -- under the deferential standard of review that applies under FAA section 10, which looks only at gross defects in the process, we have to say they have done their job, they have found this contract authorizes the arbitrators, if they find that it's necessary, and -- you know, we do have a right -- this argument here, which is that they haven't done anything. They haven't decided whether--
John Paul Stevens: --May I ask a question, a very basic, elementary questions? Where in the record is the specific question to the arbitrators found -- that they were asked to respond to?
Cornelia Tl Pillard: --Well, that's a good question. In the arbitrators' own opinion?
John Paul Stevens: I understand what the arbitrators said, but is there anything in the record that says we want you to answer this narrow question, and if so, what is it?
Cornelia Tl Pillard: The -- what I'm looking to, and I'm not sure this is going to be the best cite for you, but in the Petitioners' reply brief, they say, the -- on page 6, "The parties certainly authorized the arbitrators to determine whether the parties intended to permit or prohibit class arbitration. " And I do think that's an accurate statement of what the arbitrators--
John Paul Stevens: But the record does not contain--
Cornelia Tl Pillard: --Got it.
John Paul Stevens: --the specific question that arbitrators were asked to answer. Is that correct?
Cornelia Tl Pillard: I--
John Paul Stevens: Because I haven't been able to find it. I understand what they say they were asked to answer, but I thought there would be some document saying we've agreed to this supplemental arbitration agreement, which is going to define what the answer -- what is the question you have to answer.
Cornelia Tl Pillard: --Right. Well, the supplemental agreement does--
John Paul Stevens: Because I don't think, that -- from what I've been able to read, I don't think they were ever asked the question whether the agreement authorizes class action or class procedures. They were only asked to decide whether it either permitted it or precluded it, but is that what the question really was?
Cornelia Tl Pillard: --Now, "permitted" I think they take to understand as "authorize", and the reason -- and this is something that the court, in the context of Sixth Circuit Dub Herring case, says -- they explain why do we use the language "permit"? We use it because they are not saying whether we are actually going to use this power; we are just saying this power is available to you. But I think, for purposes of whether the contract is giving the authority to the arbitrators, that "permitted" means "authorized".
John Paul Stevens: See, as I understand it, in the supplemental agreement, they were asked a question about the meaning of the underlying arbitration agreement.
Cornelia Tl Pillard: Yes.
John Paul Stevens: But I can't find what that specific question was, which seems, to me, answers the whole case, if we could find out what it is.
Stephen G. Breyer: There's a supplemental agreement here because I thought--
Cornelia Tl Pillard: Yes.
Stephen G. Breyer: --in reading this, the supplemental agreement submitted the case under Rule 3--
Cornelia Tl Pillard: Yes.
Stephen G. Breyer: --of the AAA, and it's supplement--
Cornelia Tl Pillard: Yes.
Stephen G. Breyer: --rule 3 of the AAA supplementary rules says, an arbitrator shall, quote, "determine, as a threshold matter, in a reasoned, partial, final award, on the construction of the arbitration clause, whether the applicable arbitration clause permits the arbitration to proceed on behalf of or against a class. "
Cornelia Tl Pillard: Thank you.
Stephen G. Breyer: So I thought the supplemental agreement said--
Cornelia Tl Pillard: Thank you.
Stephen G. Breyer: --apply Rule 3, and therefore, it was asking the arbitrators to decide the question put in Rule 3. Is that right?
Cornelia Tl Pillard: I think that's correct, yes.
Stephen G. Breyer: So then we could get the question by reading page 7 of the blue brief.
Ruth Bader Ginsburg: Well, is that what's on 56a of the joint appendix, Construction of the Arbitration Clause? That's what Mr. Waxman referred us to?
Cornelia Tl Pillard: Yes, that's right -- 56a of the--
Ruth Bader Ginsburg: "Upon appointment, the arbitrator shall determine, as a threshold matter. "
Antonin Scalia: What page?
Cornelia Tl Pillard: --Are you at -- on the buff -- in the buff joint appendix? 56a?
Ruth Bader Ginsburg: Yes. 56a.
Cornelia Tl Pillard: 56a. Exactly. It's -- I've bracketed it here. It's under heading 3, Construction of the Arbitration Clause. "Upon appointment, the arbitrator shall determine, as a threshold matter, in a reasoned, partial, final award, on the construction of the arbitration clause, whether the applicable arbitration clause permits the arbitration to proceed on behalf of or against a class. " So the question put to them is: Is it permissible in that phase? And the question put to them in the next phase is: Do you actually want to use it in the context of this case? I did want to address the language that -- that Justice--
Antonin Scalia: May I -- you know, that doesn't help me a lot. What does it mean, if it permits it? I mean, I guess you could say, if there's a background rule, that whether the parties agree to it or not, it's okay. Does "permits it" mean "authorizes it"? Does -- does that mean whether the parties have agreed to it? Is that what "permits" mean there?
Cornelia Tl Pillard: --In my view, it means it authorizes the arbitrators to choose. We are talking here about a question of arbitration procedure, as this Court correctly characterized it in Bazzle. And, typically, what you have is an arbitration clause that says you arbitrate any disputes and, as this one does, it doesn't incorporate any arbitration provider's rules; and, therefore, what you have is the arbitrators have to select the procedures.
John G. Roberts, Jr.: --If you and I have a--
Cornelia Tl Pillard: So they're not--
John G. Roberts, Jr.: --I'm sorry. If you and I have a contract -- you're going to sell me a car, and we write up a contract and we enter into it, and it provides for arbitration if we have a dispute. I also buy a car from Mr. Waxman, and I Xerox that contract. It's the exact same contract. We have a dispute, and we go to arbitration. Can Mr. Waxman come in and say, I got the same contract, and I've got the same dispute. Arbitrate with me, too?
Cornelia Tl Pillard: --I would say that if you have -- well, if they've chosen the arbitrator and we have chosen the arbitrator, and it's the same arbitrator and the arbitrator wants to put them together, under this language, I would say the arbitrator does have the authority to do that, yes.
John G. Roberts, Jr.: Okay. Now, suppose I have a contract just with you and -- to arbitrate -- or I -- I have the same contract with Mr. Waxman, but it has no arbitration clause. And he says, well, the dispute is the same, you are arbitrating that, can I come in, too, and get bound by your decision?
Cornelia Tl Pillard: I would say no.
John G. Roberts, Jr.: You would say no. And the reason is?
Cornelia Tl Pillard: He doesn't have an arbitration agreement with you.
John G. Roberts, Jr.: Not that I -- he doesn't have any arbitration agreement with me or that it's not the same arbitration agreement?
Cornelia Tl Pillard: He doesn't have an arbitration agreement that has the same language, that has -- the same or substantially similar language giving the arbitrator the authority to use class procedures.
John G. Roberts, Jr.: Let's say the intent is pertinent when we enter into the contract, okay? And there's good evidence about what you and I meant the contract to mean, and there's not any evidence about what Mr. Waxman and I meant the contract to mean. Say we've got an arbitration clause in both cases. Can we arbitrate -- can I be required to arbitrate Mr. Waxman's contract with -- along with the one that you and I have entered into?
Cornelia Tl Pillard: I think your question is getting to we have evidence of subjective intent here and none there, but the New York law, as is the law in many jurisdictions, is an objective intent standard, so you look to the language as evidence of intent. And on this intent question, I did just want to respond to a question that Justice Alito had asked Mr. Waxman about Mr. Persky saying there has been no agreement that has been reached on this issue, which is in the joint appendix, the buff-colored appendix, on page 77a. Now, he clarifies in the next sentence that what he -- what he is speaking to there is there has been no agreement to bar class arbitrations, right? But this is in the context of disputes over whether this maritime expert witness testimony is going to be admitted. And I think it's very clarifying that two pages later, at page 79a of the joint appendix, Mr. Persky expressly makes the argument that we believe the arbitrators adopted, which is that the arbitration clause here contains broad language, and this language should be interpreted to permit class arbitrations. And at the end of the following paragraph he continues: "Use of "any" normally means all and includes class arbitration. " except -- "unless expressly excluded". So he is two pages later making--
Antonin Scalia: What page -- what page are you quoting from?
Cornelia Tl Pillard: --I'm -- I'm sorry. I'm quoting from the buff-colored joint appendix at page 79a around the middle of the page and then in the following paragraph. So he's clearly making the argument here, and he doesn't make it in the brief that Mr. Waxman cited. And I think the arbitrators correctly rejected the -- the Respondents' framing of that issue and actually went further, as they say in their opinion. They didn't think that those were adequate grounds to rule for the Respondents, for us. They thought they had to find an intent in the contract. And then Mr. Persky does make that argument, which I think is the winning argument, here on page 79a. Now--
Ruth Bader Ginsburg: May I -- may I ask you this question? Let's assume that you prevail in this case. I -- I would assume that the tankers are now going to add to their contract, as many contracts do, a provision saying no class action -- you cannot proceed in a class action. If the arbitration agreement says agreed to arbitrate any and all disputes, but you may not proceed on behalf of a class, would that preclude you from bringing a class action any place?
Cornelia Tl Pillard: --I think it would if -- and if the -- that might be the exact kind of fact situation that if the arbitrators somehow ignored that in reading the contract and said, oh, you -- we still have the authority to authorize a class, that is the kind of thing that under this very deferential standard of review might be exceeding their powers--
Ruth Bader Ginsburg: There are many, many contracts -- and pick up your average credit card agreement -- that will say you may not bring this as a class.
Cornelia Tl Pillard: --Many such contracts, and indeed there are contracts that started doing that back in the '90s. I think the case before -- Discover Bank is a party that started to put express no-class-action terms.
Ruth Bader Ginsburg: But then you won't get -- you win this case, but then all the future AnimalFeeds lose because they'll just put in the arbitration agreement you can't proceed on class.
Cornelia Tl Pillard: That's right. But at least it was incumbent on them to do that here if this was something that they were so concerned about would be such a burden on them. And the fact that they did not do that, even though class arbitration has been something that has been happening actively in California for at least a quarter century -- this is one of the largest, you know -- with an economy--
Antonin Scalia: Not in this industry, however.
Cornelia Tl Pillard: --I'm not so sure. I mean, we don't have evidence that -- that it has been going on, no, because this is a--
Antonin Scalia: Yes.
Cornelia Tl Pillard: --Thank you.
John G. Roberts, Jr.: Thank you, counsel. Mr. Waxman, why don't you take 2 minutes?
Seth P. Waxman: Okay. Three points, so I will take 25 seconds for each point. First of all, these contracts in the class are not all the same. These are form contracts that are drafted by the charterers and their brokers, and they involve different clauses, including different arbitration clauses. The second point, the Rule 3, I think, fairly does encapsulate the question that the parties presented to the Court, which is to construe the contract, the question that the Bazzle plurality sent back. The AAA amicus brief in this case, which I commend to the Court, on behalf of no party says over and over and over again, we drafted the rules to provide procedures to answer the Bazzle contract question. We have no opinion about the answer to the Federal statutory question that arises if the answer to the -- the meeting-of-the-minds question is no meeting of the minds as a matter of contract law. And if you find -- and much of the discussion this morning has focused on this -- that, well, somehow the arbitrators did just decide the meeting-of-the-minds question, they didn't decide the legal consequences of no meeting of the minds, then just as in Keating and as in Bazzle, you will not be able to reach the very important, fundamental FAA statutory question in this case. And the next generation of lawyers will come before you or your successors to get it answered. Now, as to the contract question, I do want to address your point, Justice Breyer, about the toolbox. It is true that in answering the contract -- what is -- what did the parties intend? Was there really a meeting of the minds here? And, by the way, let me just say that when Ms. Pillard says, well, we don't know whether the parties in this industry agreed or disagreed, all of the -- the evidence was undisputed that since the days of Marco Polo the background principle in maritime law has been bilateral, rigorously bilateral.
John G. Roberts, Jr.: Thank you, counsel. The case is submitted.


Warren E. Burger: We'll hear arguments next in 1051, Givhan against Western Line Consolidated School. I think you may proceed when you're ready Mr. Rubin.
David Rubin: Mr. Chief Justice and may it please the Court. I represent the petitioner in this case Mrs. Bessie Givhan. Question presented here is whether a teacher was unprotected by the First Amendment against termination of her employment for the particular view she expressed, nearly because those views were communicated privately to her principle rather than in a public forum. The case arose in 1971 in Mississippi during the throes of court ordered school desegregation.
Warren E. Burger: Well isn't it a little bit broader than that Mr. Rubin? The action wasn't taken because of just some communications based on a total attitude evaluated by the principal, was it not?
David Rubin: No Your Honor, the District Court in this case found that the primer indeed almost the entire reason for the termination of the petitioner's employment was because of her criticism of certain policies and practices of her School District and her school criticism which was expressed to her principle, criticism that the policies and practices were racially discriminatory. The Court of Appeals while they accepted the factual findings of the District Court concluded that the communications for which he was penalized were unprotected by the First Amendment because they were expressed privately to her principal rather than in a public forum. This is a ruling that the respondents have conceded was erroneous and rightly so because if the First Amendment means anything, it means that an individual is protected against punishment by the Government for expressing a particular idea. This isn't to say that First Amendment interests are absolute and that the interest of the School District as the employer can't be accommodated. But this Court created a means for such accommodation in its Pickering decision which established the balancing test under which the teacher's free speech interest is to be balanced against the interest of the School District as employer implicated by the teacher's expressions. The Court of Appeals thought that to recognize a free speech interest in a teacher to express a particular idea to her principal would necessarily imply a right to an audience with the principal as The Court of Appeals put it. But no right of access of any sort need be implied by the ruling that we seek from this Court, the -- for the purposes of this case, it may be assumed arguendo that the school authorities could absolutely bar by rule or regulation or directive access that might present a constitutional question but it would be not the constitutional question presented by this case.
William H. Rehnquist: You mean just have a suggestion box type of thing? Say that any teacher can put suggestions in the suggestion box if she wishes to address to the principal but there's no guarantee that the principal is going to have time to read them?
David Rubin: Well, what I'm saying is that there may be limits that must be placed upon what the school authorities can do by way barring access. But for this case, it is unnecessary to reach that question because there were no regulations of direct --
William H. Rehnquist: Well, why are -- (A) Why must there be limits and (B) why must there be regulations if in a normal course of the teacher-principal relationship the teacher knows that the principal say has a meeting from four to five and she comes up to him at one minute to four and says, Look, this policy that you're enforcing seems to be all bad and I don't think it's consistent with a constitution? The principal says, Sorry, I'd rather go to this meeting, some other time maybe, but not now? Is that unconstitutional?
David Rubin: I don't think of the -- that it would be and sort of for purposes to this case the Court need not addressed that --
William H. Rehnquist: Well -- but don't you get some sense out of the Fifth Circuit's opinion that the reason for the discharge here was that the teacher was more or less bugging the principal rather than the -- for the content of her suggestion?
David Rubin: Well it's clear from the findings of the District Court here that the petitioner did not harass the principal. That the District Court specifically found that there were only two occasions on which she communicated these criticisms to him.
William H. Rehnquist: But we'll deal with the opinion of the Court of the Appeals not with the District Court's opinion.
David Rubin: But the Court of Appeals did not find that the petitioner harassed the principal.
William H. Rehnquist: Well it didn't find that the petitioner harassed but it certainly intimate -- at least I got the intimation of it that the reason for the discharge wasn't these -- so much the communication or the conduct of the communication is just the very unseemly times and demands on the principal's time.
David Rubin: No Your Honor. The Court of Appeals specifically held not clearly erroneous the District Court's finding that the primary reason for the termination was the communications that were made by the petitioner and the criticism of the policies and practices of the School District is racially discriminatory. It did not disturb the District Court's findings which indicated that there has been no harassment.
William H. Rehnquist: You say it must rise to a level of harassment before one could discharge an employee because the employee insist upon more or less taking up time that the superior wishes to devote to other affairs.
David Rubin: Well, I don't want to exclude the possibility that the School District might show some other legitimate interest in the -- in not hearing or not or in precluding the expressions but I don't think I can catalog what those interests might be. Harassment certainly I think would be one of them. Since the respondents have rightly conceded that the Court of Appeals holding in this case was an error. This presents the Court with the question of how to dispose of the certiorari issue which is in an unusual posture admittedly because both sides have agreed that the Court of Appeals' holding was wrong.
William J. Brennan, Jr.: They don't agree the judgment was wrong?
David Rubin: They do not agree that the judgment was wrong and --
William J. Brennan, Jr.: Well, that isn't unusual to find that the respondents don't entirely defend a -- their reasoning.
David Rubin: Well, I thought I ought to address myself to the posture since there hasn't been any debate in this Court on the merits of the certiorari issue. Nevertheless because we both -- we submit the issue is a clear one.
William J. Brennan, Jr.: Who wants to debate on whether you should affirm or reverse?
David Rubin: Yes there is, and I intend in one moment to reach that question. But I wanted to say that we submit the Court should resolve the certiorari issue on the merits because that is the only disposition it seems to us that will assure that the Court of Appeals does not adhere to its decision in this case with mischievous consequences and --
William J. Brennan, Jr.: Well, what if they -- what if we decided they used the wrong standard, why shouldn't we remand and let them deal with it first?
David Rubin: To vacate and to remand in light of the respondent's concession?
William J. Brennan, Jr.: No, in light of whatever's standard we thought was applicable.
David Rubin: Well, the reason is that we believe that this Court should wrap up this case now because -- and decide the Pickering question, the respondents have asked that the judgment of the Court of Appeals be affirmed on the ground that when the Pickering test is applied the respondents, the petitioners rather expressions should be held unprotected and we've joined with the respondents in asking this Court to decide the issue or to decide it in the petitioner's favor. A remand on that issue with mean another round of briefing and argument in a case that's already seven and a half years old and we submit that there isn't any real issue to be decided under Pickering because there is no legitimate interest of the School District as employer that is implicated or was implicated by the petitioner's expressions. This isn't the case in which the petitioner was making some personal criticism for impugning the principal's character. She spoke on -- in connection with policies and practices of the school system. They were matters of policy.
William H. Rehnquist: Mr. Rubin, you represent only Givhan and not (Voice Overlap) --
David Rubin: That's correct.
William H. Rehnquist: Is that right?
David Rubin: That's correct. The petitioner's expressions were not calculated to threaten the working relationship between her and her principal because they held no potential for public embarrassment. They were given the private context, given that context, the only purpose the petitioner could have had was to influence the principal to accept her ideas. As I've indicated there was no harassment because under the District Court's findings, there were only two occasions on which these expressions were communicated to the principal. And so, since there were no legitimate interests of the School District as the employer they were implicated about the petitioner's expressions. There was nothing to place on the other side of the scale to counterbalance this petitioner's free speech interest.
William H. Rehnquist: Well, what if the School District authorizes the principal to say to the teachers, "Look, I just don't want to hear from you at all, you teach and I'll supervise and that's it. You can say what you want to, any place you want to but just don't bother me with it".
David Rubin: Your Honor, I think there might be a constitutional issue that could be raised under the Pickering test. In other words there may be --
William H. Rehnquist: Well, how would you phrase it?
David Rubin: Well its -- it is conceivable that the First Amendment might confirm some free speech right to criticize at least school policies internally rather than being forced to go into a public forum --
William H. Rehnquist: In a free speech duty and the principal to listen?
David Rubin: Well, at least a possibly a duty not to discipline the teacher for expressing the view whether he had to listen is I think is another question. But none of these questions are presented by the issue that is in this case which is only whether a teacher can be disciplined because she expressed a particular idea to her principal. The Court may assume for purposes of this case of that access could be absolutely barred and that the principal could close his ears or become a hermit if he wished to. I would only add that the expressions in this case were especially deserving of constitutional protection. The petitioner spoke as a concerned citizen about a matter of public importance namely the respective roles of blacks and whites in the environment of the school located in the School District then under Court order desegregation a topic of intense community concern at the time.
Warren E. Burger: Didn't the notice to this teacher recites what the reasons were for the non-recommendation for rehiring. One, a flat refusal to administer standardized national test of the pupils in your charge is one of the reason. It has nothing to do with the First Amendment, does it?
David Rubin: But the District Court's finding Your Honor was that the primary indeed almost the entire reason was her communications to her principal not -- he didn't make a finding with respect to that.
Warren E. Burger: This is still part of the record, isn't it?
David Rubin: Its -- it -- there was a dispute as to whether she refused to administer this -- standardized test. Her testimony which was corroborated by other -- another teacher and a guidance councilor was to the effect that she did give the test but the -- and the District Court concluded that there was a conflict in the evidence on that point and made no finding on it.
Thurgood Marshall: But the Court of Appeals agreed with the District Court?
David Rubin: The Court of Appeals agreed with the District Court with respect to its factual findings.
Thurgood Marshall: In that finding?
David Rubin: Right. The petitioner spoke not only as a concerned citizen but she also spoke as a concerned teacher. She was concerned with the impact of the respective roles in -- of blacks and whites in the school environment upon the learning incentives of her students. This is -- in a school more than 90% black in its enrollment. She had taught black students for many years in the dual system and had taught in both segregated and in desegregated schools. And so she was among those members of the community most likely to have an informed opinion about the matters that she criticized. And for all these reasons, we submit that this Court should rule that the constitution protects her against the punishment, this punishment for expressing her ideas. Now we ask that the Court reverse the judgment of the Court of Appeals and with instructions to reinstate the judgment of the District Court.
Potter Stewart: The Mt. Healthy case, I refreshed my recollection, I read these briefs some time ago. The Mt. Healthy case was decided between the trial and the appeal in this case?
David Rubin: The Mt. Healthy case was decided between the briefing of the case in the Court of Appeals and the argument of the case in that Court. The respondents ask for a remand in light of that case. But the Court of Appeals which had the record before it and reviewing that record concluded that there was no serious issue requiring a remand --
Potter Stewart: Yes.
David Rubin: -- under Mt. Healthy. And it -- it's our position that under the decisions of this Court the respondents not having filed any cross-petition of the issue not having been raised than our petition for certiorari and the respondents not having raised the issue in the opposition to certiorari, that certiorari petition that this Court will not consider that issue now. I would like to reserve the balance of my time for rebuttal.
Warren E. Burger: Very well Mr. Rubin. Mr. Robertshaw?
J. Robertshaw: Mr. Chief Justice and may it please the Court. Basically, our position in this case is that the Fifth Circuit reached the right result but for the wrong reason. And I must be perfectly candid with this Court and say that I don't think that the First Amendment protection is dependent upon the forum of the degree on publicity or in the manner in which it's exercised. The question is whether the communication is or should be constitutionally protected. Now, I would like to take about two minutes and put this case in proper prospective. First, there is a direct relationship between the quality of a community and the quality of its public education. Second, you can't get a quality education without quality teachers. Now, how do we do this? In Mississippi, a teacher is employed under a written contract, statutory. She may not be paid unless she has a written contract. During the time of that contract she may be discharged only for incompetence or immoral conduct for a brutal treatment of a pupil for a willful neglect of duties of for other good cause. And our courts have rightly held that a professional contract is something not likely to be done away with and that the statute means what it says. But at the end of the contract then there is a decision as to whether a teacher should or should not be reemployed. Now, basically, this question is one of management. The question is whether or not the petitioner in this case should have been reemployed and we think that that is a proper decision to make and that the management should make it on the basis of daily contact over a long period of time that the Courts are eloquent to make a contrary judgment based solely upon evidence in a record that is put on in a formal atmosphere and upon his personal observation of the teacher on a stand where she obviously is going to be.
William H. Rehnquist: But in our Roth and Perry cases we held that a teacher could not be denied renewal of her contract for reasons that violated the First Amendment, did we not?
J. Robertshaw: Perry v. Sindermann was a nontenure case. This is a nontenure case. And in Perry v. Sindermann, this Court held that a teacher could not be denied reemployment because of exercise of constitutionally protected rights and remanded that case for a determination as to whether that in fact happened. Roth as I understand it simply held that a teacher, a nontenured teacher had no right to continue the employment protected by the Fourteenth Amendment.
William H. Rehnquist: But in Roth, the District Court had reserved ruling on the teacher's First Amendment complaint. And simply, the case had come up here on the claim that there had been a right -- denial of property right in a tenure and we held that -- define tenure and said that just an expectation is in tenure. But even a nontenured teacher can be -- cannot be fired in violation of the First Amendment.
J. Robertshaw: As I under -- as I recall the facts of the two cases, both Roth and Sindermann were nontenured cases.
William H. Rehnquist: Well, supposing you have an --
J. Robertshaw: Now in --
William H. Rehnquist: Supposing you have an employee whose clearly understood, who has a contract at will that can be terminated tomorrow by the state employer and the clearly established reason for termination is because he makes a statement on some public issue that offends the employer. Do you think that this employer can simply rely on the doctrine that he had had no contractual right to be -- continued in employment?
J. Robertshaw: I certainly do not. And it might be helpful for the Court to follow the development in our state. Other law to its present form which specifically holds now even though we do not have -- that is -- this is a statute. I might make a reference to it. It's called a school employment procedures act. And it specifically says that a nonreemployment decision may not be based upon a violation of a teacher's statutory or constitutional right. And that is Section 37-9-101, the School Employment Procedures Law and specifically the basis upon which the decision may be reversed is Section 37-9-113. Now, I do not believe that there is or should be any difference between the constitutionally protected rights of a public employee or a private employee. I think that they're exactly the same and to the extent of cases that have been decided it seemed to hold that a public employee has a higher right. I think they're wrong.
William H. Rehnquist: Well, do you mean to say that the -- a grocery merchant can't fire his clerk because the clerk says something about a public issue that the merchant doesn't like?
Thurgood Marshall: You apply the First Amendment to a private individual?
J. Robertshaw: I think that the same rule applies to a private merchant as it does to a public employee, no more, no less.
Byron R. White: Well, what earthly authority do you have for that?
J. Robertshaw: Sir?
Byron R. White: What earthly authority do you have for that under any decided case from this Court?
J. Robertshaw: I'm not sure Mr. Justice what the specifics of your question are.
William H. Rehnquist: My question is very specific, and that is do you know of any case from this Court that supports the proposition you just stated?
J. Robertshaw: That there is a difference?
William H. Rehnquist: That there's no difference which was what I understood from your proposition.
J. Robertshaw: I think we must -- misunderstand each other if you will pardon me but I think I agree with the -- exactly to the point that I believe you are making and that is if they are treated alike on the law.
Potter Stewart: Well, quite a point, no, no.
J. Robertshaw: Sir?
Potter Stewart: It's just -- I understood my Brother here -- Rehnquist to -- in his questions implicitly to be making just the opposite point. I -- and quite apart from any decided cases the constitutional protections run only against the Government. This isn't --
J. Robertshaw: I don't know of any case --
Potter Stewart: -- as a matter of definition.
J. Robertshaw: -- to that effect.
Potter Stewart: Well, quite a -- well, you don't need any cases just -- you need the constitution of the United States.
J. Robertshaw: I agree.
William J. Brennan, Jr.: The First and the Fourteenth Amendment protects us against governmental action not against private action.
J. Robertshaw: I agree.
Potter Stewart: Alright.
Warren E. Burger: There's no state action when the grocery clerk is dealt with by his employer, is there?
J. Robertshaw: Well --
Warren E. Burger: There is state action here.
J. Robertshaw: There is state action here because the board of trustees and -- which runs this is harmless to state government. Now, we concede the jurisdiction in this case sir. Now, I think we ought to look in determining whether this was a proper reemployment decision at the context in which this action was taken. Now, mind you, we do not criticize Mrs. Givhan while the -- for her right to make this. Our objection is to the manner and the circumstances under which these statements were made. Now, this school started out in the fall of 1969 --
John Paul Stevens: Mr. Robertshaw, could I --
J. Robertshaw: Excuse me.
John Paul Stevens: -- just ask one question.
J. Robertshaw: 27;28 hard of hearing.
John Paul Stevens: You say that the decision was not based on what she said but rather the manner in which she said it as I understand you.
J. Robertshaw: That is absolutely correct --
John Paul Stevens: But did not --
J. Robertshaw: -- and I think that's what the Judge Smith found when he said she was overly critical.
John Paul Stevens: But did not the judge say that the -- in page 35A of the certiorari petition that as a finder of fact after hearing all the testimony in reviewing the exhibits he concluded that the primary reason for the School District's failure to renew her contract was her criticism with the policies and factors of the School District. Do you accept that finding?
J. Robertshaw: Yes sir, if I may explain my acceptance. At that time the District Court was bounded by Sindermann once you find that the exercise of the First Amendment rights forms a material part of the decision then under Sindermann, he had to reverse this. He had the hold against it. But he says the primary reason, now, what I'm saying is that on the Mt. Healthy v. Doyle, this Court held under -- which also was a tenure case that the District Court should have gone further and made a specific finding as to whether the board would have not rehired the teacher independently of the constitutional protection rights. So that -- so far as Judge Smith's finding is concerned, if he said it's a primary reason then he is bound under Perryman -- I mean under Perry v. Sindermann. But we want the fighting chance to show that we would not have rehired her anyhow.
John Paul Stevens: But did not -- you make precisely this argument to the Court of Appeals and they rejected this very argument.
J. Robertshaw: I did but you must realize that the rejection of the Fifth Circuit is dictum in view of the fact that they held there was no violation of First Amendment rights. So consequently having held to that there was no violation of rights then there would be no reason for remand.
John Paul Stevens: Well is it really a dictum because if they were -- if you had prevailed on that argument they would not have had to decide the constitutional issue they decide that argument. If you had prevailed it would have enabled them to avoid the constitutional issue and would it not be good practice for an appellate court to see if they couldn't avoid the constitutional issue?
J. Robertshaw: Yes.
John Paul Stevens: So it is really not a dictum in the ordinary sense?
J. Robertshaw: No. You've got to look at Pickering --
Warren E. Burger: Counsel, would you stay close to the lecterns so that we don't lose any (Voice Overlap) --
J. Robertshaw: I apologize. You've got to look at Pickering for what it is. Pickering is a discharge case not a reemployment case. Now, we say even under Pickering under the facts of this case under the necessity for a close working relationship between a principal and a teacher that the conduct of this teacher, some of which was protected by the First Amendment and some of which was not put it in such a situation that the principal testified that he knew he had to run that school the following year. And that he felt he couldn't do it with Mrs. Givhan present and that for that reason he didn't recommend her.
John Paul Stevens: Mr. Robertshaw, let me ask one other question and I don't mean to take too much time but you are not defending the judgment of the Court of Appeals, are you? The judgment being that she -- her claim must fail.
J. Robertshaw: I am not defending the judgment of the Court of Appeals to the extent that it holds that private communications between an employee and an employer are not protected by the First Amendment.
John Paul Stevens: So you are asking us without having filed a cross-petition for certiorari to modify the judgment of the Court of Appeals?
J. Robertshaw: I'm -- no, to be perfectly frank Your Honor, this is my first appearance before this Court. I had to be -- I did not know that if I wanted to raise a point I had to file a cross-petition. But I do think that this Court certainly has the power to determine the rules that should govern situations of this type and remand the case to the Fifth Circuit or to the District Court or proceedings consistent with your opinion.
William J. Brennan, Jr.: So you don't think that -- you don't think that its -- that the Court of Appeals is correct in saying that as of -- that on this record the petitioner should be -- is out of Court. Do you think there should be some further proceedings go on before her rights are terminated?
J. Robertshaw: I think in the interest to basic fairness they should be and for this reason. The District Court's decision was July the 2nd, of 1975. Our replied brief --
William J. Brennan, Jr.: Well you don't believe the record that's before us is sufficient for us to make any -- at least you don't insist that we make any determination here based on a new -- on a different standard in the Court of Appeals.
J. Robertshaw: No, I don't think that the record is sufficient. I think that it should be remanded under Doyle, because in Doyle you said to the District Court you should have looked into this. And the District Court in this case had no way in the world of anticipating Doyle which was not decided until January of 1977. Now, let me touch briefly on the type of comment we are talking about and it is I believe a significant fact in one that I had completely overlooked until preparing in what I hope to some depths for this. And that is that the District Court in its orders in January of 1970 had retained a specific jurisdiction for the entry of any other orders that might be necessary. It had full jurisdiction over the cases. So if in fact the respondent district had been guilty of discrimination in the handling of its administrative personnel in Glen Allan if in fact they have been guilty of discrimination in handling of the NYC workers. Or if in fact it had been guilty of discrimination in assigning a white to take up tickets in the cafeteria then that should have been brought to the attention of the District Court and was not. And I say to you that it was not brought to the District Court for corrective action because there was no need. Now as I understand it, those are the three points on which they claim First Amendment protection. Let me take the to NYC workers. The NYC workers are hired by the employment service and referred on the basis of their qualifications to schools. We can employ them where we are told to employ them. Now, all of the NYC workers were black. So you couldn't say that we were discriminating in the assignment. Now this leaves to the objection that there were not enough black faces in the administrative office. Now this was as school of 530 odd pupils. The administrative staff consisted of the principal who was white, the assistant principal who was black, the elementary supervisor who was black and the guidance councilor for the school who was black and one white secretary. Now, I don't think you can say that we were discriminating there. Now, let's look at the assignment of people to the cafeteria. The objection is that the person who took up the tickets had "the choice position". But the facts are that that white was the only person employed at the cafeteria of the white race, the manager was black. All other employees were black. The white had been hired on the recommendation or appointment rather of the black cafeteria manager made to the cafeteria supervisor. Now, if we had been discriminating them, the Court could have taken corrective action. Now, really what we are getting down to you is that we have a teacher and we'd make no argument that she was not a competent teacher so long as she stayed within the scope of our employment but a teacher who was constantly interfering with the operation of the schools under circumstances that we're trying. I didn't complete the picture in the middle of the 69-70 this entire district was shaken up. All seven through 12 people went to Riverside which was the center and the middle at the north, O'Bannon, all and one through six pupils, at Glen Allan in the south all one through six in that zone. It was so bad that a consent decree was entered during the summer and we reconstituted this district at that time by agreement. Now, in your normal school situation, a kid goes in, in the first grade and he makes his associations, the teachers have worked together. There are peer groups formed. There is a comfortable atmosphere. Now, during the year in question, the year following which petitioner was not rehired, that was the fall opening in the new one through 12 configuration. They didn't even have a principal down there for the first four to five weeks. Things were in confusion. There was no discipline. Students were walking in the hall. And the first and most paramount duty was to recreate an atmosphere conducive to the education of the pupils and to get on with the business of giving the best possible education to the students of the district in there. I think we've -- not a good job moving. But in order to do it you got to have teachers that will cooperate. You will have teachers that will not protest the giving of routine test such as the six weeks test or semester test doesn't make any difference which.
Warren E. Burger: But the findings are not all in your favor on that score, the findings of the District Court, are they?
J. Robertshaw: Well, the evidence is uncontradicted and it's admitted by petitioner. There was no finding on it.
Warren E. Burger: Well the finding, there was a finding --
J. Robertshaw: The finding was that we had a --
Warren E. Burger: You had dismissed her or fail to renew her primarily because of the First Amendment factor. Was that the finding?
J. Robertshaw: Because she was a vocal critic.
Warren E. Burger: No?
J. Robertshaw: And because we had -- now what is the -- I've been unable to --
Thurgood Marshall: Would you mind giving the quote on that?
J. Robertshaw: Sir?
Thurgood Marshall: Would you mind giving me the quote where the district judge said what you said. Has he said the primary reason or the failure? To renew or their criticism? Now, what did he say that she was (Inaudible)?
J. Robertshaw: On page 35A, however when the School District's decision, this is of the petition for certiorari as the Court please. When the School District's decision to terminate Givhan's employment is placed in the setting contemporaneous with it's conception and execution it becomes clear to the Court that the School District's motivation in failing to renew Givhan's contract was almost entirely a desire to rid themselves of a vocal critic of the district policies and practices which were capable of interpretation as embodying a racial discrimination. The Court conceives this to be a violation of Givhan's right under the First Amendment, Perry v. Sindermann. Now --
Thurgood Marshall: The Court finds that none of these were specifically brought to the Court's attention were neither petty nor unreasonable? None were petty nor unreasonable? 35A say (Voice Overlap) --
J. Robertshaw: Yes sir. Now --
Thurgood Marshall: You just don't want the school teacher to have a right to criticize.
J. Robertshaw: Sir?
Thurgood Marshall: Is that your petition?
J. Robertshaw: I --
Thurgood Marshall: That a teacher should not have the right to criticize the administration?
J. Robertshaw: No sir, that --
Thurgood Marshall: Is that your petition?
J. Robertshaw: No sir, that is my -- that is not my petition. I think that it is in the interest of the administration of a successful school that there'd be a free interchange between a teacher and a principal of ideas and criticisms with the idea of something constructive. But I do not think that in the presence of students in the -- while classes are being changed that -- that's where -- or the circumstances under which certain conduct should take place.
Warren E. Burger: Well, do you have anything further Mr. Rubin?
J. Robertshaw: Does this mean that I -- oh, I see. Are there question from the Court?
Warren E. Burger: No.I hear none. Do you have anything further Mr. Rubin?
David Rubin: No Your Honor, I waive rebuttal.
Warren E. Burger: Thank you gentlemen. The case is submitted.