Amicus Curiae Brief — Henry Schein, Inc., et al., Petitioners v. Archer and White Sales, Inc.

No. 17-1272

================================================================

In The

Supreme Court of the United States

-----------------------------------------------------------------HENRY SCHEIN, INC., ET AL.,

Petitioners,

v.

ARCHER AND WHITE SALES, INC.,

Respondent.

-----------------------------------------------------------------On Writ Of Certiorari To The

United States Court Of Appeals

For The Fifth Circuit

-----------------------------------------------------------------AMICUS CURIAE BRIEF OF

ANTHONY MICHAEL SABINO

IN SUPPORT OF PETITIONERS

-----------------------------------------------------------------ANTHONY MICHAEL SABINO*

MICHAEL A. SABINO

SABINO & SABINO, P.C.

92 Willis Avenue, 2nd Floor

Mineola, New York 11501

(516) 294-3199

Anthony.Sabino@sabinolaw.com

August 2018

*Counsel of Record

================================================================

COCKLE LEGAL BRIEFS (800) 225-6964

WWW.COCKLELEGALBRIEFS.COM

i

QUESTION PRESENTED

Whether the Federal Arbitration Act permits a

court to decline to enforce an agreement delegating

questions of arbitrability to an arbitrator if the court

concludes the claim of arbitrability is “wholly groundless.”

ii

TABLE OF CONTENTS

Page

QUESTION PRESENTED...................................

i

TABLE OF CONTENTS ......................................

ii

TABLE OF AUTHORITIES .................................

iv

INTEREST OF AMICUS CURIAE ......................

1

STATEMENT .......................................................

1

SUMMARY OF ARGUMENT ..............................

2

ARGUMENT ........................................................

2

I.

II.

III.

IV.

THE “WHOLLY GROUNDLESS” THEOREM HAS NO BASIS IN THE TEXT OF

THE FEDERAL ARBITRATION ACT ........

2

THE “WHOLLY GROUNDLESS” THEOREM

NULLIFIES

CONTRACTUAL

TERMS, AND DEPRIVES PARTIES OF

THE BENEFIT OF THEIR BARGAIN .......

6

THE “WHOLLY GROUNDLESS” THEOREM IS CONTRARY TO THE STRONG

FEDERAL POLICY FAVORING ARBITRATION ...................................................

9

THE “WHOLLY GROUNDLESS” THEOREM IS A JUDICIAL CONSTRUCT

WHICH IMPERMISSIBLY FRUSTRATES

ARBITRATION .......................................... 11

iii

TABLE OF CONTENTS – Continued

Page

V.

THE “WHOLLY GROUNDLESS” THEOREM DEPRIVES PARTIES OF THEIR

PREROGATIVE TO DELEGATE “QUESTIONS OF ARBITRABILITY” TO THE ARBITRATOR ................................................. 13

CONCLUSION..................................................... 16

iv

TABLE OF AUTHORITIES

Page

CASES

American Express Co. v. Italian Colors Restaurant, 570 U.S. 228 (2013)............................... 6, 12, 14

Archer and White Sales, Inc. v. Henry Schein,

Inc., 878 F.3d 488 (5th Cir. 2017) ..............................8

AT&T Mobility LLC v. Concepcion, 563 U.S. 333

(2011) ............................................................... passim

AT&T Technologies, Inc. v. Communications

Workers of America, 475 U.S. 643 (1986) .......... 14, 15

Buckeye Check Cashing, Inc. v. Cardegna, 546

U.S. 440 (2006) ..........................................................3

Dean Witter Reynolds Inc. v. Byrd, 470 U.S. 213

(1985) .........................................................................6

Epic Systems Corp. v. Lewis, 584 U.S. ___, slip op.

at 3 (No. 16-285) (May 21, 2018)......... 4, 5, 10, 12, 14

First Options of Chicago, Inc. v. Kaplan, 514 U.S.

938 (1995) .......................................................... 14, 15

Howsam v. Dean Witter Reynolds, Inc., 537 U.S.

79 (2002) ............................................................ 13, 14

Mastrobuono v. Shearson Lehman Hutton, Inc.,

514 U.S. 52 (1995) ................................................. 3, 7

Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985) .............................. 6, 7

Moses H. Cone Memorial Hospital v. Mercury

Construction Corp., 460 U.S. 1 (1983) ................ 2, 10

Prima Paint Corp. v. Flood & Conklin Mfg. Co.,

388 U.S. 395 (1967) ...................................................4

v

TABLE OF AUTHORITIES – Continued

Page

Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63

(2010) ................................................................... 6, 14

Shearson/American Express Inc. v. McMahon,

482 U.S. 220 (1987) .................................................14

Stolt-Nielsen S.A. v. AnimalFeeds International

Corp., 559 U.S. 662 (2010) ................................... 6, 13

Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior University, 489

U.S. 468 (1989) ...................................................... 3, 7

STATUTES

Federal Arbitration Act. 9 U.S.C. §§ 1, et seq. .... passim

9 U.S.C. § 2 ................................................................ 3, 4

9 U.S.C. § 3 ....................................................................3

9 U.S.C. § 4 ....................................................................3

Racketeer Influenced and Corrupt Organizations Act ...................................................................14

RULES AND REGULATIONS

Sup. Ct. R. 37.3(a) .........................................................1

OTHER AUTHORITIES

Anthony M. Sabino & Michael A. Sabino, “Law

of the Land: U.S. Supreme Court Upholds Arbitration Agreements, Despite State Court

Resistance,” 61 Nassau Lawyer 3 (December

2011) ........................................................................12

vi

TABLE OF AUTHORITIES – Continued

Page

Anthony Michael Sabino, “Awarding Punitive

Damages in Securities Industry Arbitration:

Working For A Just Result,” 27 U. of Richmond L. Rev. 33 (1992)............................................10

Michael A. Sabino & Anthony M. Sabino, “ ‘Epic’

Decision by Supreme Court Orders Arbitration, Prohibits Class Action,” 259 New York

Law Journal 4 (June 6, 2018) .................................12

Petition for a Writ of Certiorari at 6 (March

2018) ..........................................................................8

1

INTEREST OF AMICUS CURIAE

This amicus curiae is a law professor with expertise in arbitration generally, securities arbitration,

commercial law, and commercial arbitration. Furthermore, this amicus curiae has represented parties in arbitration proceedings, frequently chairs arbitrations

for the Financial Industry Regulatory Authority and

other bodies, and regularly lectures on the precise topics found in the pending controversy. This case addresses the interpretation of the Federal Arbitration

Act, implicates the enforcement of agreements to arbitrate, and, hence, the proper conduct of arbitration proceedings in a wide variety of fora. This amicus curiae

has a professional and scholarly interest in the proper

application and development of the law in this domain.1

------------------------------------------------------------------

STATEMENT

This amicus curiae respectfully adopts, in relevant

part, the Statement of Facts set forth by the Petitioners herein, Henry Schein, Inc., et al. (“Petitioners”).

-----------------------------------------------------------------1

No counsel for a party authored this brief in whole or in

part, and no such counsel or party made a monetary contribution

intended to fund the preparation or submission of this brief.

Counsel of record received timely notice of the intent to file this

brief, as required by Supreme Court Rule 37.3(a). Petitioners and

Respondent timely filed blanket consents to the filing of any and

all briefs of amici curiae, whether in support of either or neither

party.

2

SUMMARY OF ARGUMENT

The question presented must be answered in the

negative, for reason of the text of the Federal Arbitration Act, the strong federal policy favoring arbitration,

and the lengthy and consistent line of precedents upholding that ideal. The “wholly groundless” theorem is

unsupported by the statutory regime which empowers

arbitration, it frustrates the strong federal policy favoring arbitration, and the doctrine cannot be reconciled with the Court’s jurisprudence, which for decades

now has robustly upheld the enforceability of agreements to arbitrate. As with other impediments to arbitration, the “wholly groundless” theorem should be

eradicated or at least be subjected to a limiting principle.

------------------------------------------------------------------

ARGUMENT

I.

THE “WHOLLY GROUNDLESS” THEOREM

HAS NO BASIS IN THE TEXT OF THE

FEDERAL ARBITRATION ACT.

Since 1925, arbitration has been regulated, and,

moreover, encouraged, by the Federal Arbitration Act.

9 U.S.C. §§ 1, et seq. (“FAA”). The FAA explicitly directs

the courts to enforce agreements to arbitrate, and empowers them to do so by a variety of means.

Foremost in the statutory scheme is Section 2, the

“primary substantive provision of the Act.” Moses H.

Cone Memorial Hospital v. Mercury Construction

Corp., 460 U.S. 1, 24 (1983). The statute mandates that

3

a written provision in a contract which calls for the arbitration of controversies “shall be valid, irrevocable,

and enforceable.” 9 U.S.C. § 2 (emphasis supplied). See

Volt Information Sciences, Inc. v. Board of Trustees of

Leland Stanford Junior University, 489 U.S. 468, 474

(1989). It is noteworthy that the proviso is stated in the

imperative “shall,” and not the permissive “may” or

similar.

Subsequent portions of the FAA also unmistakably work towards the goal of enforcing agreements to

arbitrate. See 9 U.S.C. § 3 (providing for a stay of proceedings for a matter referable to arbitration), § 4 (supplying jurisdiction to compel arbitration), and § 9

(establishing a mechanism for confirming and enforcing an arbitration award). See also Volt, supra, 489 U.S.

at 474 (analyzing Sections 2 and 4). In sum and substance, every aspect of the FAA supports the enforcement of agreements to arbitrate. See AT&T Mobility

LLC v. Concepcion, 563 U.S. 333, 344 (2011) (“Concepcion”).

The Court has repeatedly declared the aim of the

FAA is to ensure private agreements to arbitrate are

enforced according to their terms. See Mastrobuono v.

Shearson Lehman Hutton, Inc., 514 U.S. 52, 57 (1995)

(quotation omitted). The Court has frequently held the

FAA places agreements to arbitrate on “an equal footing with other contracts.” Concepcion, supra, 563 U.S.

at 339 (quotations omitted), citing Buckeye Check

Cashing, Inc. v. Cardegna, 546 U.S. 440, 443 (2006). See

also Volt, supra, 489 U.S. at 474, 478.

4

Most recently, the Court has declared that the

FAA safeguards arbitral accords from “judicial interference.” Epic Systems Corp. v. Lewis, 584 U.S. ___, ___,

slip op. at 3 (No. 16-285) (May 21, 2018). See also Prima

Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395,

404 (1967) (the plain language of the Act evinces a

clear legislative intent to prohibit judicial obstructionism to arbitration). As the most recent addition to the

pantheon of the Court’s arbitration jurisprudence,

Epic confirms that the statutory components of the

FAA constitute a cohesive scheme which “require[s]

courts to respect and enforce agreements to arbitrate.”

Epic, supra, slip op. at 5.

Quite telling is the closing paragraph of Epic,

wherein the Court characterizes the statutory regime

as a solemn command from Congress “that arbitration

agreements . . . must be enforced as written.” Id., slip

op. at 25.

One final aspect of the FAA must be considered for

purposes of the case at bar. Section 2 of the FAA contains a “savings” clause, which can render an agreement to arbitrate unenforceable “upon such grounds as

exist at law or in equity for the revocation of any contract.” 9 U.S.C. § 2. This subpart leaves intact generally

applicable defenses to contract enforcement, such as

fraud, duress, and unconscionability, as proper

grounds for declining to enforce an arbitration agreement. Concepcion, supra, 563 U.S. at 339 (quotation

and citation omitted). The savings clause is consistent

with the law’s intent to place arbitral accords on the

same footing as ordinary contracts. See id.

5

To be certain, the Court has carefully cabined Section 2’s savings clause, ruling that it does not evince

any intent to preserve judicial constructs “that stand

as an obstacle to the FAA’s objectives.” Id. at 343 (invalidating a state law rule purporting to make agreements to arbitrate unenforceable). Doctrines which

apply solely to agreements to arbitrate or derive their

meaning from the fact that the underlying pact calls

for arbitration are not salvaged by this statutory subcomponent. Id. at 339. See also Epic, supra, slip op. at

1-2 (Thomas, J., concurring) (the sole basis for setting

aside an agreement to arbitrate are those defenses

concerning the formation of the underlying arbitral accord).

In consideration of all the above, the “wholly

groundless” theorem finds no support within the FAA.

It is unmoored from the statutory text. Indeed, the doctrine is antithetical to the statutory regime, for it undercuts the overriding legislative command that

agreements to arbitrate shall be valid, irrevocable, and

enforceable.

Nor does the “wholly groundless” theorem find

support within the Court’s precedents expounding

upon the text of the FAA. Indeed, the doctrine constitutes the very type of judicial meddling which the

Court has repeatedly, and even recently, declared is forbidden by the statutory regime.

Lastly, the “wholly groundless” theorem finds no

refuge in the savings clause of Section 2. The doctrine

is not a traditional contract defense preserved by the

6

statutory caveat. In truth, it is the type of judicial

mechanism which the Court’s precedents have excluded from Section 2’s safe harbor.

It is respectfully submitted by this amicus that the

“wholly groundless” theorem has no basis in the FAA.

Lacking foundation in the statutory scheme, the doctrine should be eliminated or at least be subjected to a

limiting principle.

II.

THE “WHOLLY GROUNDLESS” THEOREM

NULLIFIES CONTRACTUAL TERMS, AND

DEPRIVES PARTIES OF THE BENEFIT

OF THEIR BARGAIN.

It is a “fundamental principle that arbitration is a

matter of contract.” Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63, 67 (2010). See also American Express

Co. v. Italian Colors Restaurant, 570 U.S. 228, 233

(2013). In relation thereto, it has long been a bedrock

principle of this Court’s jurisprudence that arbitration

is a matter of consent, not coercion. Stolt-Nielsen S.A.

v. AnimalFeeds International Corp., 559 U.S. 662, 681

(2010), quoting Volt, supra, 489 U.S. at 479 (quotations

omitted). Precisely for these reasons, the Court’s arbitration landmarks have long affirmed that “the FAA

requires courts to honor parties’ expectations.” Concepcion, supra, 563 U.S. at 351.

Agreements to arbitrate must therefore be rigorously enforced. Dean Witter Reynolds Inc. v. Byrd, 470

U.S. 213, 221 (1985). As with any other contract, the

parties’ intentions control. Mitsubishi Motors Corp. v.

7

Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626 (1985).

The proper role of the courts is to “give effect to the

contractual rights and expectations of the parties,” as

gleaned from the arbitral accord. Volt, supra, 489 U.S.

at 479.

Reflecting that arbitral pacts are just like ordinary contracts, it has long been acknowledged that

parties are generally free to shape their agreements to

arbitrate as they see fit. Mastrobuono, supra, 514 U.S.

at 57. See also Concepcion, supra, 563 U.S. at 344 (“The

point of affording parties discretion in designing arbitration processes” is that it empowers them to adopt

the rules and procedures they deem best suited to their

particular needs.). Thus, in yet another hallmark of the

Court’s arbitration jurisprudence, it is well known that

parties may categorize the controversies they wish to

submit to the arbitrator for resolution. See generally

Mitsubishi Motors, supra, 473 U.S. at 628 (parties may

choose to include or exclude statutory claims from arbitration, but are bound to that choice, once it is made).

The “wholly groundless” theorem cannot stand before these precedents, both generally and in the context of the instant case. As a general matter, the

doctrine upsets the maxim that, like any contract, an

agreement to arbitrate is to be rigorously enforced.

Contrary to the axioms set forth above, the “wholly

groundless” theorem substitutes judicial intervention

for contract stipulations, consent, and the expectations

of the parties.

8

Specific to the matter before the Court, the salient

(and, arguably, dispositive) contractual language at the

heart of the instant controversy unequivocally states

that “[a]ny dispute arising under or related to this

Agreement . . . shall be resolved by binding arbitration.” The sole exemptions from this plainspoken directive are actions for injunctive relief or disputes

relating to intellectual property. Archer and White

Sales, Inc. v. Henry Schein, Inc., 878 F.3d 488, 491 (5th

Cir. 2017) (case below). See also Petition for a Writ of

Certiorari at 6 (March 2018). The original action alleged violations of the antitrust laws, not intellectual

property rights. The request for unspecified injunctive

relief was apparently overwhelmed by a demand for

money damages amounting to tens of millions of dollars. Petition for a Writ of Certiorari at 5-6 (March

2018). It would appear the controversy underlying the

case at bar falls squarely within the ambit of the directive to arbitrate any dispute.

Furthermore, certain aspects of the arbitral accord

described above are likely beyond question. The first is

the agreement to arbitrate was arrived at by consent;

it was not imposed by coercion. Second, the signatories

contracted to arbitrate any dispute (the aforementioned exceptions aside). Third and last, no doubt the

parties expected a court to honor the terms of their accord.

The “wholly groundless” theorem confounds both

the terms of that arbitral pact and the parties’ expectations. The doctrine sets aside the words agreed to,

and imposes new terms, hitherto unknown to the

9

parties. The “wholly groundless” theorem reinvests a

court with adjudicative power, contrary to the more

limited role apparently contracted for and expected by

the parties. The doctrine irrevocably alters what disputes are cognizable in arbitration, and therefore the

procedures by which they will be resolved.

A final point: “any dispute” means “any dispute” or

at least it should. Those plain words, found at the heart

of the instant case, were cancelled out by lower tribunal’s application of the “wholly groundless” theorem,

thereby usurping the terms of the relevant contract,

and frustrating the expectations of the parties.

It is respectfully submitted by this amicus that the

“wholly groundless” theorem is contrary to the arbitration jurisprudence of this Court, including, but not limited to, the principles that arbitration is a matter of

contract, contracts to arbitrate must be enforced according to their terms, and the expectations of the contracting parties are to be honored. The doctrine

violates those maxims, and therefore the “wholly

groundless” theorem should be overridden or at least

be subject to a limiting principle.

III. THE “WHOLLY GROUNDLESS” THEOREM

IS CONTRARY TO THE STRONG FEDERAL

POLICY FAVORING ARBITRATION.

A long and unbroken line of this Court’s arbitration landmarks informs us that, well into the opening

decades of the Twentieth Century, there was widespread judicial hostility towards arbitration as an

10

alternative to traditional litigation. Most recently, the

Court reminds that once upon a time “courts routinely

refused to enforce agreements to arbitrate” or found

other means to reduce their effectiveness. Epic, supra,

slip op. at 5.

The strong federal policy validating arbitration

closed that unfortunate chapter in American law. Moses H. Cone, supra, 460 U.S. at 24. See also Anthony

Michael Sabino, “Awarding Punitive Damages in Securities Industry Arbitration: Working For A Just Result,” 27 U. of Richmond L. Rev. 33, 34-39 (1992)

(summarizing the then-extant landmarks announcing

the strong federal policy favoring arbitration). Consonant with that mandate, for many decades now the

Court has repeatedly and consistently put aside obstacles to the fulfillment of the robust policy favoring arbitration. See generally Epic, supra, slip op. at 16 (“In

many cases over many years, this Court has heard and

rejected efforts to conjure conflicts between the Arbitration Act and other federal statutes.”).

The “wholly groundless” theorem is untethered

from the strong federal policy favoring arbitration. In

contravention of the legislative mandate pronounced

nearly one hundred years ago, the doctrine diverts controversies from arbitration, and redirects them to litigation. The “wholly groundless” theorem thwarts

contractual terms providing for arbitration, and

thereby frustrates the expectations of the parties to

such arbitral accords. The net result is inapposite to

the strong federal policy favoring arbitration.

11

It is respectfully submitted by this amicus that the

“wholly groundless” theorem is at odds with the strong

federal policy favoring arbitration, and therefore the

doctrine must be erased or at least strictly cabined.

IV. THE “WHOLLY GROUNDLESS” THEOREM

IS A JUDICIAL CONSTRUCT WHICH IMPERMISSIBLY FRUSTRATES ARBITRATION.

Consistently and without hesitation, the Court

has, time and again, put to the side judge-made law

which frustrates agreements to arbitrate. See Concepcion, supra, 563 U.S. at 340-41. In dismantling one

such obstacle to arbitration, that one emanating from

a state tribunal, the Court warned that judicial hostility towards arbitration “manifest[s] itself in a great variety of devices and formulas.” Id. at 342 (quotations

and citations omitted). Given that Concepcion’s most

powerful lessons have already been well illustrated in

the arguments preceding this one, there is no need to

regurgitate them here.

The salient point to be made at this juncture is

that the axiom announced in Concepcion held no ambiguity. It pronounced that whenever judicial constructs from whatever source prohibit or impede

arbitration, “the analysis is straightforward: The conflicting rule is displaced by the FAA.” Id. at 341. Concepcion provides the rule for decision in the case at bar,

as it has in other, recent arbitration landmarks. See

12

American Express, supra, 570 U.S. at 238 (“Truth to

tell,” Concepcion “all but resolves” the question.).

The “wholly groundless” theorem found in the instant case is little different from the state court construct disavowed in Concepcion. The former suffers

from the same flaws as the latter: it is antithetical to

the strong federal policy favoring arbitration; it usurps

the contractual terms of the parties’ arbitral accord;

and it defeats the parties’ expectations.

Refuting the “wholly groundless” theorem extant

in the case at bar is required, not merely for the present, but with a view towards the future. Even as the

FAA approaches its centennial, “remnants of [a] ‘litigation only’ ideology occasionally crop up” in the form of

judicially crafted obstacles to arbitration. Anthony M.

Sabino & Michael A. Sabino, “Law of the Land: U.S. Supreme Court Upholds Arbitration Agreements, Despite

State Court Resistance,” 61 Nassau Lawyer at 3, cl. 2

(December 2011).

Small wonder, then, that near the conclusion of its

last term, the Court reaffirmed its obligation to guard

against “new devices” intended to confound agreements to arbitrate. Epic, supra, slip op. at 9, quoted by

Michael A. Sabino & Anthony M. Sabino, “ ‘Epic’ Decision by Supreme Court Orders Arbitration, Prohibits

Class Action,” 259 New York Law Journal at 4, cl. 4

(June 6, 2018).

The instant matter is the latest test of the Court’s

commitment to the ideals exemplified in its arbitration

jurisprudence. Negating the “wholly groundless”

13

theorem in the case at bar is imperative, not merely for

the sake of today, but to also assure that judicial manifestations yet to be conceived cannot survive the

Court’s scrutiny.

It is respectfully submitted by this amicus that the

“wholly groundless” theorem is yet another judicial

construct irremediably opposed to the text of the FAA,

and the strong federal policy favoring arbitration. Just

as the Court nullified its predecessors, the “wholly

groundless” doctrine must be set aside or at least made

subject to a limiting principle.

V.

THE “WHOLLY GROUNDLESS” THEOREM

DEPRIVES PARTIES OF THEIR PREROGATIVE TO DELEGATE “QUESTIONS OF

ARBITRABILITY” TO THE ARBITRATOR.

It is a basic tenet of the Court’s arbitration jurisprudence that “questions of arbitrability” are ordinarily for a court to decide. Howsam v. Dean Witter

Reynolds, Inc., 537 U.S. 79, 83 (2002). Yet the Court issued a contemporaneous warning that this postulation

is to be applied narrowly, and then solely to prevent

the injustice of forcing arbitration upon a party that

had never consented to same. Id. at 83-84 (cautioning

that not every threshold or “gateway” controversy

amounts to a “question of arbitrability”).

The foregoing is offset by a rule of equal efficacy;

parties to an arbitral accord “may choose who will resolve specific disputes.” Stolt-Nielsen, supra, 559 U.S.

at 683 (emphasis supplied). Accordingly, parties to an

14

arbitral pact enjoy the liberty of delegating questions

of arbitrability to the arbitrator, provided they do so in

clear and unmistakable terms. Howsam, supra, 537

U.S. at 83, quoting AT&T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643, 649 (1986)

(quotation omitted). See also Rent-A-Center, supra, 561

U.S. at 68-69 (“We have recognized that parties can

agree to arbitrate ‘gateway’ questions of ‘arbitrability.’ ”).

It is not surprising that precedent allows parties

to override the ostensible norm, and delegate “questions of arbitrability” to the arbitrator. For decades

now, the Court has looked on with approval as parties

have entrusted arbitrators with the power to decide issues arising under solemn and complex statutory

schemes, such as the federal securities laws, Shearson/

American Express Inc. v. McMahon, 482 U.S. 220, 238

(1987), the Racketeer Influenced and Corrupt Organizations Act, id. at 242, and the federal antitrust laws.

American Express, supra, 570 U.S. at 233-34. See also

Epic, supra, slip op. at 16 (summarizing the above and

additional precedents “reject[ing] efforts to conjure

conflicts” between the FAA and other federal statutes).

Provided it is clearly and unmistakably stated, the parties’ delegation of “questions of arbitrability” to the

arbitrator is indistinguishable from these other, far

reaching assignments of adjudicative authority to arbitrators.

Who determines questions of arbitrability turns

upon “what the parties agreed to about that matter.”

First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938,

15

943 (1995) (emphasis in the original). See also AT&T

Technologies, Inc., supra, 475 U.S. at 649-50 (parties

may agree to submit the question of arbitrability to the

arbitrator, and not a court). The primacy accorded to

the choice of the parties is firmly grounded in “the fact

that arbitration is simply a matter of contract,” First

Options, supra, 514 U.S. at 943, and arbitral pacts,

“like other contracts, are enforced according to their

terms.” Id. at 947 (quotations and citations omitted).

In sum, the Court’s arbitration jurisprudence

clearly requires that the first priority is to determine

what the parties agreed to with regard to who decides

“questions of arbitrability.” If it appears the parties

delegated questions of arbitrability to the arbitrator,

the next step is to assure that such delegation was expressed in clear and unmistakable terms.

The “wholly groundless” theorem is irreconcilable

with the foregoing. For one, the doctrine unnecessarily

superimposes itself upon existing rules which more

than adequately define a cogent process for determining who answers “questions of arbitrability.” Next, the

“wholly groundless” theorem increases the opportunity

for judicial intervention with respect to the arbitrability question, while undermining the parties’ freedom

to conform the arbitral process to their wishes. Lastly,

the precepts discussed above sit in counterpoise. The

“wholly groundless” theorem upsets that balance, tipping it toward a judge’s discretion and away from the

parties’ choices.

16

It is respectfully submitted by this amicus that the

“wholly groundless” theorem misunderstands the

Court’s arbitration jurisprudence regarding who determines questions of arbitrability, fails to recognize the

prerogatives of parties to contractually delegate such

issues to the arbitrator, and unjustifiably elevates a

judge’s discretion in matters of arbitrability. For these

reasons, the “wholly groundless” doctrine must be set

aside or at least be delimited.

------------------------------------------------------------------

CONCLUSION

Respectfully, for all the reasons set forth above, the

“wholly groundless” theorem should be eradicated or

at least be subjected to a limiting principle, and the

question presented answered in favor of the Petitioners.

Respectfully submitted,

ANTHONY MICHAEL SABINO*

MICHAEL A. SABINO

SABINO & SABINO, P.C.

92 Willis Avenue, 2nd Floor

Mineola, New York 11501

(516) 294-3199

Anthony.Sabino@sabinolaw.com

August 2018

*Counsel of Record