Opinion ID: 4565238
Heading Depth: 3
Heading Rank: 1

Heading: The FAA’s Pro-Arbitration Policy and the

Text: Severability Doctrine We begin with the FAA, the federal statute that guides our analysis of arbitration agreements in contracts governed by 11 federal labor law.6 “The FAA establishes a strong federal policy in favor of compelling arbitration over litigation.” Sandvik AB v. Advent Int’l Corp., 220 F.3d 99, 104 (3d Cir. 2000); see also Hall St. Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 581 (2008) (noting that “Congress enacted the FAA to replace judicial indisposition to arbitration with a national policy favoring it” (internal quotation marks and alteration omitted)); Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 111 (2001) (explaining that “the FAA was a response to hostility of American courts to the enforcement of arbitration agreements”). 6 The District Court treated the CBA’s arbitration provision as if it were governed by the FAA, a premise that the parties accept. We proceed under the same premise. Although the FAA applies to commercial arbitration agreements by its own terms, it is well-accepted that labor arbitration disputes arising under federal law should be resolved in accordance with the FAA, even though labor arbitration agreements may not be technically governed by the statute. See Granite Rock Co. v. Int’l Bhd. of Teamsters, 561 U.S. 287, 298-99 & n.6 (2010) (applying FAA cases to a CBA’s arbitration provision, “because they employ the same rules of arbitrability that govern labor cases”); United Paperworkers Int’l Union, AFLCIO v. Misco, Inc., 484 U.S. 29, 41 (1987) (noting that “federal courts have often looked to the [FAA] for guidance in labor arbitration cases, especially in the wake of the holding that § 301 of the [LMRA], 29 U.S.C. § 185, empowers the federal courts to fashion rules of federal common law to govern [s]uits for violation of contracts between an employer and a labor organization under the federal labor laws” (internal quotation marks and citations omitted)(second alteration in original)). 12 Following the enactment of the FAA, the Supreme Court has steadily advanced this policy by guarding against unwarranted judicial interference with arbitration. See, e.g., Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524, 529 (2019) (holding that courts cannot decide arbitrability issues that the parties agreed to submit to arbitration even if “the argument for arbitration is wholly groundless”); Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 406 (1967) (holding that arbitrators have the primary power to decide legal issues relating to the parties’ contract absent evidence indicating the parties intended to exclude those issues from arbitration). Of relevance here is the Supreme Court’s decision in Prima Paint, which established what is known as the “severability doctrine.” Sandvik, 220 F.3d at 105 (citing Prima Paint, 388 U.S. at 404). After looking at the FAA’s text and structure, in particular sections 2, 3 and 4, the Court held that an arbitration clause is “severable” and independently enforceable from the rest of the contract in which it is contained. Id.; see Prima Paint, 388 U.S. at 400, 403-04. Under this severability rule, a party cannot avoid arbitration by attacking the contract containing the arbitration clause as a whole (the “container contract”). Rather, the party opposing arbitration must challenge “the arbitration clause itself.” Prima Paint, 388 U.S. at 403. For instance, a claim of fraud in the inducement of the arbitration clause is for the court to decide, but a claim of fraud in the inducement of the container contract is for the arbitrator. Id. at 403-04. Because the party opposing arbitration had only alleged fraud in the inducement of the container contract, the Prima Paint Court referred that issue to the arbitrators in accordance with the arbitration clause. Thus, under Prima 13 Paint, absent a specific challenge to the validity of the arbitration clause specifically, the court must treat it as a valid and enforceable agreement and refer any challenges to the container contract to arbitration. Id. at 406.