Document: 470 U.S. 213 105 S.Ct. 1238 84 L.Ed.2d 158 DEAN WITTER REYNOLDS INC., Petitioner,v.A. Lamar BYRD. No. 83-1708. Argued Dec. 4, 1984. Decided March 1985. Syllabus In 1981, respondent invested $160,000 in securities through petitioner broker-dealer. The parties had a written agreement to arbitrate any disputes that might arise out of the account. Thereafter, value account declined by more than $100,000. Respondent then filed an action against Federal District Court, alleging violations Securities Exchange Act 1934 and various state-law provisions. Petitioner motion compel arbitration pendent state claims under parties' stay pending resolution federal action. argued Arbitration Act—which provides agreements "shall be valid, irrevocable, enforceable, save upon such grounds as exist at law or equity for revocation contract"—required Court claims. denied motion, Appeals affirmed. Held: erred refusing grant petitioner's Pp. 216-224. (a) requires district courts arbitrable when one files compel, even result would possibly inefficient maintenance separate proceedings different forums. By its terms, leaves no room exercise discretion court, but instead mandates shall direct proceed on issues which has been signed. Act's legislative history establishes principal purpose was ensure judicial enforcement privately made agreements, not promote expeditious compelling claims, court successfully protects contractual rights their Act. 216-221. (b) Neither nor joined is necessary protect interest federal-court proceeding. formulation collateral-estoppel rules affords adequate protection interest. 221-223. 726 F.2d 552, reversed remanded. Eugene W. Bell, Los Angeles, Cal., petitioner. Eric V. Benham, San Diego, respondent. Justice MARSHALL delivered opinion Court. 1 question presented whether, complaint raises both may deny despite disputes. We granted certiorari resolve conflict among Courts this question. 467 1240, 104 3509, 82 818 (1984). 2 * A. Byrd sold his dental practice Dean Witter Reynolds Inc., $100,000 between September 1981 1982. United States Southern California, violation §§ 10(b), 15(c), 20 1934, 15 U.S.C. 78j(b), 78o(c), 78t, jurisdiction over based diversity citizenship principle jurisdiction. complaint, alleged agent traded without prior consent, number transactions executed behalf excessive, misrepresentations were status account, acted with Witter's knowledge, participation, ratification. 3 When funds he signed Customer's Agreement providing "[a]ny controversy you undersigned arising relating contract breach thereof, settled arbitration." App. Pet. Cert. 11. accordingly order severing arbitration, staying those 12. It (Arbitration Act), 9 1-14, contract," § 2, required authorizes petition issue referable agreement. 3, 4. Because assumed claim subject provision could resolved only forum, it did seek claim.1 entirety sever interlocutory appeal Ninth Circuit 552 II 4 Confronted we address2—whether will event assert federal-law claim—the have adopted two approaches. Along case, Fifth Eleventh Circuits relied "doctrine intertwining." nonarbitrable same transaction, are sufficiently intertwined factually legally, view, try all together court.3 These acknowledge strong policy favor enforcing offer reasons why nevertheless should decline situation. First, they preserve what consider court's exclusive claim; otherwise, suggest, "intertwined" precede proceeding factfinding done arbitrator thereby bind collateral estoppel. second reason cite efficiency; declining avoids bifurcated perhaps redundant efforts litigate factual questions twice. 5 contrast, Sixth, Seventh, Eighth held divests regarding cases containing asked do so. conclude Act, plain meaning reflects, enforce bargain arbitrate, "not substitute [its] own views economy efficiency" Congress. Dickinson v. Heinold Securities, 661 638, 646 (CA7 1981).4 6 agree these latter where Accordingly, reverse decision arbitration. III 7 controversies existing contract." 2. place Thus, insofar language guides our disposition must enforced, absent ground 8 suggested, however, does expressly address whether mandate—to holds true where, here, course if enforced.5 drafters explicitly prospect proceedings, told, clear misleading. view case goal speedy efficient decisionmaking thwarted that, given absence direction point, intent Congress passing controls compels refusal They point out, addition, past occasion identified contrary outweigh mandate see n. 1, supra, so case. See, e.g., Miley Oppenheimer & Co., 637 318, 336 (CA5 1981); Cunningham Reynolds, 550 F.Supp. 578, 585 (ED Cal.1982). turn, then, guidance issue. congressional scenario address. conclude, consideration Congress' statute, otherwise made. 10 behind passage arbitrate. therefore reject suggestion overriding after all, merely enforcement—upon parties—of negotiated agreements. House Report accompanying makes "upon footing other contracts, belongs," H.R.Rep. 96, 68th Cong., 1st Sess., (1924), overrule judiciary's longstanding arbitrate.6 This say blind potential benefit legislation expedited Far from it, observed: 11 "It practically appropriate taken time there much agitation costliness delays litigation. matters can largely eliminated valid enforceable." Id., 12 Nonetheless, motivated, first foremost, desire into entered,7 overlook objective construing allow fortuitous impact dispute overshadow underlying motivation. Indeed, conclusion compelled Court's recent holding Moses H. Cone Memorial Hospital Mercury Construction Corp., 460 103 927, 74 765 (1983), affirmed requiring agreement, though proceedings. That misfortune, noted, "occurs because relevant piecemeal give effect agreement," id., 20, S.Ct., 939. See also 24-25, 941 ("The matter law, doubts concerning scope arbitration"). 13 persuaded argument goals Act—enforcement private encouragement resolution—must realize drafters. preeminent concern entered, rigorously "piecemeal" litigation, least countervailing manifested another statute. supra. IV 14 some held, decide before them, findings subsequent preclusive believed pose threat warrant arbitration.8 Other separately resolved, warrants claim.9 claim, suspect response holdings. believe significantly less well lower opinions consequences misconception unnecessarily contorted procedures. neither proceeding, 16 Initially, far certain litigation Just last Term, full-faith-and-credit 28 1738, judicially fashioned rule preclusion, permits accord res judicata unappealed award brought 42 1983. McDonald West Branch, 466 284, 1799, 80 302 statute State's State rendering judgment, since apply awards. 287-288, 1801-1802. analysis inevitably declined, McDonald, fashion common-law part cannot provide protecting statutory constitutional 1983 designed safeguard. recognized necessarily 17 Significantly, directly effectively interests determining Since preclusion doctrine comfortably plays role, follows assure precedent impede sought accomplish indirectly erroneously directly. 18 effect, any, yet us, it. completed, course, need now encompasses Suffice framing context, take warranting protection. As result, require manipulate ordering resulting simply avoid infringement interests. 19 Finding unpersuasive arguments advanced support ruling below, hold upheld denial remand further consistent opinion. ordered. 21 WHITE, concurring. 22 I join write add few words undeveloped. 23 premise us respondent's arbitrable, notwithstanding parties. rightly concludes us. Ante, 216, 1. note substantial doubt. Wilko Swan, 346 427, 182, 98 L.Ed. 168 (1953), unenforceable regard 12(2) 1933 three interconnected provisions: voids "stipulation . binding person acquiring security waive compliance provision" Act; 12(2), which, creates "a special right recover misrepresentation differs substantially action"; 22, allows suit competent nationwide service process. U.S., 431, 434-435, 184, 186; 77n, 77l (2), 77v. 24 reasoning mechanically transplanted While 29 78cc(a), equivalent counterparts provisions imperfect altogether. Jurisdiction narrower, being restricted courts. 78aa. More important, cause 10(b) Rule 10b-5, involved implied rather express. Herman MacLean Huddleston, 459 375, 380, nn. 9, 10, 683, 686-87, 548 (1983). phrase "waive chapter," 78cc(a) (emphasis added), thus literally inapplicable. Moreover, solicitude action—the "special right" established Congress, 184—is action.* 25 expressed reservations before. Scherk Alberto-Culver 417 506, 513-514, 94 2449, 2454, 41 270 (1974). reiterate them emphasize remains open, holdings viewed 26 refuse fear effect. And perceive few, possible outcome lawsuit. Belated clause, interference nonetheless disappoints expectations frustrates once decided go forward independently, suggests delayed. impossibility lawyers places accommodation scheduling, seems me heavy presumption lawsuit each normal course. while determined nothing record indicate present stayed. predispute 1933, enforceable. pointed declares "void" "stipulation" waiving "provision" amounted stipulation remedy, void. 186. Years later, (1974), questioned applicability Acts differ, because, unlike rise 512-513, 2453-2454. not, context 10b-5 retained considerable vitality numerous applies unenforceable. DeLancie Birr, Wilson 648 1255, 1258-1259 (CA9 Merrill Lynch, Pierce, Fenner Smith, Inc. Moore, 590 823, 827-829 (CA10 1978); Weissbuch 558 831, 833-835 1977); Sibley Tandy 543 540, 543, 1976), cert. denied, 434 824, 71, 54 (1977); Brief (citing cases); Industry Association, et al. Amici Curiae (same). amici representing industry urge 10b-5. properly argues adhesion close scrutiny, routinely enforced. instance. express merits argument. Belke 693 1023 (CA11 1982); 334-337 578 Surman 733 59 (CA8 1984); Liskey 717 314 (CA6 1983). Bifurcated several kinds involving transactions. For example, confronted result. If Acts, situation arise. Also, here party asks arises. Finally, addressed antitrust actions Lee Ply*Gem Industries, 193 U.S.App.D.C. 112, 121, 593 1266, 1274-1275, 67 (holding become "subject adjudication related claims," arises arbitrate) 441 967, 99 2417, 60 1073 (1979). According Report: "The anachronism American law. Some centuries ago, jealousy English jurisdiction, refused specific ousted survived long period became firmly embedded common felt too strongly fixed overturned enactment, although frequently criticised illogical nature injustice results bill procedure enforcement." 1-2 (1924). Cohn Dayton, New Va.L.Rev. 265, 283-284 (1926). 65 Cong.Rec. 1931 (1924) ("It new legislation, grants rights, except remedy commercial contracts admiralty contracts"). F.2d, 1026; 336; F.Supp., 582. 62-63; 644 318 (discussing ). victims illegal conduct. 16, 18, 78i, 78p, 78r. None sections

Category: 7