The Sixth Circuit examines Arbitrability

As noted in a previous post, SCOTUS confirmed that it is the court’s responsibility to determine whether or not a dispute between parties is subject to those parties’ arbitration agreement.  But, a couple weeks ago, the US Court of Appeals for the Sixth Circuit took a different tack. 

 In New Heights Fram I, LLC v. Great American Insurance Company (Case Number 24-1087), the court found “clear and unmistakable” evidence that the parties wanted any threshold issues of arbitrability to be determined by an arbitrator.  The reason behind this decision was that the arbitration agreement specified the AAA as the ADR service provider and the AAA’s rules state:

• The arbitrator shall have the power to rule on their own jurisdiction (Commercial R-7(A));

• The arbitrator shall have the power to determine the existence or validity of the arbitration agreement (Commercial R-7(B));

• Any objections to the prior points must be made prior to an answering statement is filed (Commercial R-7C).

It is important for parties to remember, when entering into arbitration agreements or contesting arbitrability, that the service providers own rules may take precedence over the law.