Amicus Curiae Brief — Hickory Heights Health and Rehab, LLC, et al., Petitioners v. Yashika Watson, as Guardian of the Person and Estate of Zeola Ellis, III
Supreme Court briefDec 1, 2025
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No. 25-535
IN THE
Supreme Court of the United States
————
HICKORY HEIGHTS HEALTH AND REHAB, LLC;
CENTRAL ARKANSAS NURSING CENTERS, INC.;
NURSING CONSULTANTS, INC.; AND MICHAEL MORTON,
Petitioners,
v.
YASHIKA WATSON, AS GUARDIAN OF THE PERSON AND
ESTATE OF ZEOLA ELLIS III,
Respondent.
————
On Petition for a Writ of Certiorari to the
Arkansas Court of Appeals, Divisions IV & I
————
BRIEF OF THE NATIONAL FEDERATION OF
INDEPENDENT BUSINESS SMALL BUSINESS
LEGAL CENTER, INC. AS AMICUS CURIAE
IN SUPPORT OF PETITIONERS
————
ARAM A. GAVOOR
Counsel of Record
THE GEORGE WASHINGTON
UNIVERSITY LAW SCHOOL
ADMINISTRATIVE LAW,
ISSUES, AND APPEALS CLINIC
2000 G Street NW
Washington, DC 20052
(202) 994-2505
agavoor@law.gwu.edu
Counsel for Amicus Curiae
December 1, 2025
WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D.C. 20002
TABLE OF CONTENTS
Page
TABLE OF AUTHORITIES ................................
ii
INTEREST OF AMICUS CURIAE .....................
1
SUMMARY OF ARGUMENT .............................
2
ARGUMENT ........................................................
5
I. Reaffirming the FAA Protects Parties’
Right to Contract, Benefits Small
Businesses and Consumers, and Reduces
Judicial Backlog ........................................
5
II. CMS’s Ban on Arbitration Agreements as
a Condition of Admission Is Ultra Vires ..
11
A. Congress Did Not Clearly Displace
the FAA When it Enacted the
Medicaid and Medicare Acts ...............
13
B. Congress
Excluded
the Power
Claimed by CMS and it Should Not Be
Read into the Statute ..........................
15
III. CMS’s Rule Violates the Major Questions
Doctrine .....................................................
16
CONCLUSION ....................................................
19
(i)
ii
TABLE OF AUTHORITIES
CASES
Page(s)
Ala. Ass’n of Realtors v.
Dep’t of Health and Hum. Servs.,
594 U.S. 758 (2021) ................................... 16, 17
Am. Express Co. v. Italian Colors Rest.,
570 U.S. 228 (2013) ...................................
3, 6
AT&T Mobility LLC v. Concepcion,
563 U.S. 333 (2011) ................................... 1, 2, 6
Biden v. Missouri,
595 U.S. 87 (2022) .....................................
18
Biden v. Nebraska,
600 U.S. 477 (2023) ...................................
16
Bittner v. United States,
598 U.S. 85 (2023) .....................................
15
City of Arlington v. FCC,
569 U.S. 290 (2013) ...................................
12
Epic Sys. Corp. v. Lewis,
584 U.S. 497 (2018) ......................... 3, 4, 8, 9, 14
FERC v. Elec. Power Supply Ass’n,
577 U.S. 260 (2016) ...................................
14
Gilmer v. Interstate/Johnson Lane Corp.,
500 U.S. 20 (1991) .....................................
13
Kindred Nursing Ctrs. Ltd. P’ship v. Clark,
581 U.S. 246 (2017) ...................................
6
KPMG LLP v. Cocchi,
565 U.S. 18 (2011) .....................................
6
La. Pub. Serv. Comm’n v. FCC,
476 U.S. 355 (1986) ...................................
12
iii
TABLE OF AUTHORITIES—Continued
Page(s)
Marmet Health Care Ctr., Inc. v. Brown,
565 U.S. 530 (2012) ...................................
6
Mitsubishi Motors Corp. v. Soler ChryslerPlymouth, Inc.,
473 U.S. 614 (1985) ...................................
8, 9
Moses H. Cone Mem’l Hosp. v. Mercury
Constr. Corp.,
460 U.S. 1 (1983) .......................................
6
NFIB v. OSHA,
595 U.S. 109 (2022) ................................... 12, 16
Util. Air Regul. Grp. v. EPA,
573 U.S. 302 (2014) ................................... 5, 16
Viking River Cruises, Inc. v. Moriana,
596 U.S. 639 (2022) ...................................
2, 6
West Virginia v. EPA,
597 U.S. 697 (2022) ................................ 5, 16-18
Whitman v. Am. Trucking Ass’ns Inc.,
531 U.S. 457 (2001) ................................... 4, 14
STATUTES AND REGULATIONS
9 U.S.C. § 2 ...................................................
2, 6
5 U.S.C. § 706(2) ...........................................
12
5 U.S.C. § 706(2)(C) ...................................... 4, 11
12 U.S.C. § 5518(b) ..............................................
13
15 U.S.C. § 78o(o) .........................................
13
42 U.S.C. § 1395c ..........................................
12
42 U.S.C. §1395i-3 ........................................
4
iv
TABLE OF AUTHORITIES—Continued
Page(s)
42 U.S.C. § 1395i-3(c)(5)(A)(i)–(ii)................
15
42 U.S.C. § 1395i-3(d)(4)(B) ..................... 4, 12, 18
42 U.S.C. § 1395i-3(f)(1) ............................... 12, 17
42 U.S.C. § 1396-1 ........................................
12
42 U.S.C. § 1396r ..........................................
4
42 U.S.C. § 1396r(c)(5)(A)(i)–(ii) ..................
15
42 U.S.C. § 1396r(d)(4)(B) ........................ 4, 12, 18
42 U.S.C. § 1396r(f)(1) .................................. 12, 17
42 C.F.R. § 483.70(m) ...................................
18
42 C.F.R. § 483.70(m)(1)...............................
12
OTHER AUTHORITIES
84 Fed. Reg. 34718 (July 18, 2019) ..............
17
Amy J. Schmitz, Arbitration in the Age of
COVID: Examining Arbitration’s Move
Online, 22 CARDOZO J. CONFLICT RESOL.
245 (2021), https://scholarship.law.misso
uri.edu/cgi/viewcontent.cgi?article=1992&
context=facpubs ......................................... 3, 10
Antonin Scalia & Bryan A. Garner,
Reading Law: The Interpretation of Legal
Texts 107 (2012) ........................................
15
Black Enterprise Eds., Key Benefits of
Using Arbitration for Business Disputes,
YAHOO!FINANCE (Oct. 8, 2025), https://fina
nce.yahoo.com/news/key-benefits-usingarbit ration-business-110000534.html .....
3
v
TABLE OF AUTHORITIES—Continued
Page(s)
Black Enterprise Eds., On the Brink: 39%
Of Small Businesses Are Running On
Less Than A Month Of Cash,
YAHOO!FINANCE (Oct. 28, 2025), https://
finance.yahoo.com/news/brink-39-smallbusinesses-running-140000299.html .......
7
CARA STEPANCZUK ET AL., MEDICAID LONGTERM SERVICES AND SUPPORTS USERS AND
EXPENDITURES BY SERVICE CATEGORY,
2022 (Centers for Medicare & Medicaid
Services, 2024), https://www.medicaid.go
v/medicaid/long-term-services-supports/
reports-evaluations ................................... 5, 17
DAVID MCKNIGHT & PAUL HINTON, U.S.
CHAMBER OF COM. INST. FOR LEGAL
REFORM, TORT COSTS FOR SMALL
BUSINESSES (2023), https://instituteforleg
alreform.com/wp-content/uploads/2023/1
2/Tort-Costs-for-Small-Businesses-12.5.
23.pdf .........................................................
9
Department of Health and Human Services,
Office of Inspector General, Nursing Homes
(Dec. 20, 2024), https://oig.hhs.gov/repo
rts/eatured/nursing-homes/ ......................
17
Federal Judiciary Seeks New Judgeship
Positions, U.S. CTS. (Mar. 14, 2023),
https://www.uscourts.gov/data-news/judi
ciary-news/2023/03/14/federal-judiciary-se
eks-new-judgeship-positions........................
11
vi
TABLE OF AUTHORITIES—Continued
Page(s)
Frequently Asked Questions About Small
Business, 2024, U.S. SMALL BUS. ADMIN.
OFF. OF ADVOC. (July 23, 2024), https://
advocacy.sba.gov/2024/07/23/frequentlyasked-questions-about-small-business2024/ ..........................................................
7
Imre Stephen Szalai, The Prevalence of
Consumer Arbitration Agreements by
America’s Top Companies, 52 U.C. DAVIS
L. REV. ONLINE 233 (2019) ........................
7
NAM D. PHAM & MARY DONOVAN, FAIRER,
FASTER, BETTER III: AN EMPIRICAL
ASSESSMENT OF CONSUMER AND EMPLOYMENT ARBITRATION (Mar. 2022), https://in
stituteforlegalreform.com/wp-content/upl
oads/2022/03/FINAL-ndp-Consumer-andEmployment-Arbitration-Paper-2022.pdf ....
3, 8
The Need for Additional Judgeships:
Litigants Suffer When Cases Linger, U.S.
CTS. (Nov. 18, 2024), https://www.uscour
ts.gov/data-news/judiciary-news/2024/11/
18/need-additional-judgeships-litigantssuffer-when-cases-linger ........................... 4, 10
NFIB RSCH. CTR., SMALL BUSINESS
PROBLEMS AND PRIORITIES (11th ed.
2024), https://tinyurl. com/2bvwdk4e .......
8
NFIB RSCH. FOUND., NFIB National Small
Business Poll The Use of Lawyers, Vol. 5
Iss. 2 (2005), http://www.411sbfacts.com/
files/UseofLawyers_poll.pdf ......................
7
vii
TABLE OF AUTHORITIES—Continued
Page(s)
Paula Hannaford-Agor, Our New Normal?
How Covid-19 Accelerated Pre-Pandemic
Trends in State Court Litigation, 71
DEPAUL L. REV. 279 (2022), https://via.
library.depaul.edu/cgi/viewcontent.cgi?a
rticle=4188&context=law-review .............
10
ROY WEINSTEIN ET AL., MICRONOMICS,
EFFICIENCY AND ECONOMIC BENEFITS OF
DISPUTE RESOLUTION THROUGH ARBITRATION COMPARED WITH U.S. DISTRICT
COURT PROCEEDINGS (2017), https://
tinyurl.com/3349ttj7 ................................. 3, 8, 9
Shari Seidman Diamond & Jessica M.
Salerno, Reasons for the Disappearing
Jury Trial: Perspectives from Attorneys
and Judges, 81 LA. L. REV. 119 (2020),
https://digitalcommons.law.lsu.edu/cgi/vi
ewcontent.cgi?article=6816&context=lal
rev ..............................................................
11
Sheryl L. Axelrod, Why Arbitrate? Why
Not? The Benefits of Arbitrating Commercial Disputes, ABA (Aug. 29, 2025),
https://www.americanbar.org/gro
ups/business_law/resources/business-lawtoday/2025-august/why-arbitrate-why-notbenefits-arbitrating-commercial-dispute/ .....
9
INTEREST OF AMICUS CURIAE1
The National Federation of Independent Business
Small Business Legal Center, Inc. (NFIB Legal Center)
is a nonprofit, public interest law firm established to
provide legal resources and be the voice for small
businesses in the nation’s courts through representation on issues of public interest affecting small
businesses. It is an affiliate of the National Federation
of Independent Business, Inc. (NFIB), which is the
Nation’s leading small business association. NFIB’s
mission is to promote and protect the right of its
members to own, operate, and grow their businesses.
NFIB represents, in Washington, D.C., and all 50 state
capitals, the interests of its members.
The NFIB Legal Center files an amicus in support of
the Petition because of the critically important role
that arbitration plays in small business dispute
resolution processes. Small businesses rely on the
freedom to contract dispute resolution terms in order
to promptly and efficiently resolve disputes while
avoiding litigation costs. Through its Federal Arbitration
Act (FAA) decisions, this Court has consistently and
decisively endorsed arbitration, mandating that courts
put “arbitration agreements on an equal footing with
other contracts[.]” AT&T Mobility LLC v. Concepcion,
563 U.S. 333, 339 (2011). Small businesses have relied
1
Under Supreme Court Rule 37.6, amicus states that no
counsel for any party authored this brief in whole or in part and
no entity or person, aside from amicus, its members, or its
counsel, made any monetary contribution intended to fund the
preparation or submission of this brief. Under Supreme Court
Rule 37.2, amicus affirms that counsel of record for all parties
received proper notice of intent to file this brief.
The George Washington University takes no position on this
case.
2
on this supportive policy to structure countless contractual relationships around arbitration agreements.
By sweepingly declaring arbitration agreements
illegal under a Centers for Medicare and Medicaid
(CMS) rule that outlined conditions for long-term care
facilities’ receipt of federal funds, the Arkansas Court
of Appeals decision contravenes the FAA’s mandate.
The decision threatens Arkansas long-term care
facilities’ ability to arbitrate and likewise emboldens
other States to bypass the FAA and suppress parties’
commitment to arbitrate across a multitude of industries. Such a result would be devastating for small
businesses—not only would it disrupt the efficiency
that arbitration provides, but it would also lead to
vast economic losses. Amicus urges the Court to
reaffirm the FAA’s ‘“liberal federal policy favoring
arbitration”’ in the face of the Arkansas Court of
Appeals’ “judicial hostility to arbitration agreements.”
Id. (quoted sources omitted).
SUMMARY OF ARGUMENT
The FAA and this Court have long protected the
ability of parties to contract using arbitration agreements, and such agreements provide the small business
community, consumers, and the judiciary with irreplaceable benefits. Section 2 of the FAA bolsters arbitration
as a method of dispute resolution by declaring that
agreements are “valid, irrevocable, and enforceable.” 9
U.S.C. § 2. This Court has routinely reaffirmed the
FAA’s safeguard of arbitration by both “protect[ing]
[the] right to enforce arbitration agreements” and by
prohibiting discrimination against arbitration. Viking
River Cruises, Inc. v. Moriana, 596 U.S. 639, 650–51
(2022); see Concepcion, 563 U.S. at 339. Even in the
face of alleged federal statutory violations, the FAA’s
favorable policy towards arbitration retains its power,
3
which is only extinguishable “‘by a contrary congressional
command.’” Am. Express Co. v. Italian Colors Rest., 570
U.S. 228, 233 (2013) (quoted source omitted).
The Arkansas Court of Appeals’ decision demonstrates outright hostility to arbitration agreements
and threatens the FAA’s directive, risking harm to
small businesses and the broader economy. Arbitration
provides small businesses and consumers with “quicker,
more informal, and often cheaper resolutions” than
litigation. Epic Sys. Corp. v. Lewis, 584 U.S. 497, 505
(2018). Often operating with limited resources, small
businesses rely on arbitration’s cost-saving and costeffective processes. Prolonged litigation creates economic
uncertainty for businesses, which causes less investment and expansion.2 Compared to federal and state
litigation, arbitration provides faster resolutions, benefiting both businesses and consumers.3 Arbitration
also provides increased privacy and flexibility.4 Finally,
2
ROY WEINSTEIN ET AL., MICRONOMICS, EFFICIENCY AND
ECONOMIC BENEFITS OF DISPUTE RESOLUTION THROUGH ARBITRATION
COMPARED WITH U.S. DISTRICT COURT PROCEEDINGS 1, 16–18
(2017), https://tinyurl.com/3349ttj7.
3
NAM D. PHAM & MARY DONOVAN, FAIRER, FASTER, BETTER III:
AN EMPIRICAL ASSESSMENT OF CONSUMER AND EMPLOYMENT
ARBITRATION 1, 4, 11–15 (Mar. 2022), https://instituteforlegalrefo
rm.com/wp-content/uploads/2022/03/FINAL-ndp-Consumer-andEm ployment-Arbitration-Paper-2022.pdf.
4
See Black Enterprise Eds., Key Benefits of Using Arbitration
for Business Disputes, YAHOO!FINANCE (Oct. 8, 2025), https://
finance.yahoo.com/news/key-benefits-using-arbitration-business110000534.html; Amy J. Schmitz, Arbitration in the Age of
COVID: Examining Arbitration’s Move Online, 22 CARDOZO J.
CONFLICT RESOL. 245, 249–50 (2021), https://scholarship.law.mis
souri.edu/cgi/viewcontent.cgi?article=1992&context=facpubs (noting
that online arbitration proceedings specifically provide “efficiency,
4
arbitration as an alternative dispute resolution
procedure reduces judicial docket congestion.5
Notwithstanding the benefits of arbitration and the
FAA’s permissive policy towards it, the Arkansas
Court of Appeals’ decision should not stand because
the underlying CMS rule is invalid for two reasons.
First, CMS acted beyond its statutory authority and,
therefore, its rule regulating pre-dispute arbitration
agreements must be set aside under the Administrative
Procedure Act (APA). See 5 U.S.C. § 706(2)(C). Nothing
in the relevant statutes that confer CMS its authority
permits the agency to regulate pre-dispute arbitration
agreements. 42 U.S.C. §§ 1395i-3, 1396r. The underlying statutory authority confers only a general policy
of care and protection for residents that is far short
of the necessary “clear and manifest congressional
command to displace the [FAA].” Epic Sys. Corp., 584
U.S. at 511. Vague language allowing CMS to impose
“such other requirements relating to the health and
safety of residents or relating to the physical facilities
thereof as the Secretary may find necessary,” 42 U.S.C.
§§ 1395i-3(d)(4)(B), 1396r(d)(4)(B), falls short of the
kind of clear statutory authority necessary for the
agency to enact such a rule. As the Court has said,
Congress “does not alter the fundamental details of
a regulatory scheme in vague terms or ancillary
provisions.” Whitman v. Am. Trucking Ass’ns Inc., 531
U.S. 457, 468 (2001).
convenience, and room for innovation” as well as “time and cost
savings for all involved”).
5
The Need for Additional Judgeships: Litigants Suffer When
Cases Linger, U.S. CTS. (Nov. 18, 2024), https://www.uscourts.
gov/data-news/judiciary-news/2024/11/18/need-additional-judges
hips-litigants-suff er-when-cases-linger.
5
Second, the CMS rule also runs afoul of the major
questions doctrine. Congress must “speak clearly” if it
intends to grant agencies power to decide issues of
“vast ‘economic and political significance.’” Util. Air
Regul. Grp. v. EPA, 573 U.S. 302, 324 (2014) (quoted
source omitted); see also West Virginia v. EPA, 597 U.S.
697, 716 (2022). The Medicare and Medicaid Acts’
broad language is insufficient to allow CMS to regulate
pre-dispute arbitration agreements, which affect
significant swaths of the U.S. economy in the long-term
care context. Long-term care is a major national
enterprise: in 2022, 1.5 million institutional service
users accounted for $71 billion in institutional longterm-services-and-supports spending with $59.1 billion
(83.2%) of this funding going to nursing facilities.6
The Court should grant certiorari to reaffirm the
mandate of the FAA and confine CMS to its proper
statutory authority.
ARGUMENT
I. Reaffirming the FAA Protects Parties’ Right
to Contract, Benefits Small Businesses and
Consumers, and Reduces Judicial Backlog
Both the FAA and this Court’s precedents confirm
that federal law protects the right of consenting parties
to contract, which includes arbitration agreements,
and generally disfavors policies or actions that minimize
or negate agreed-upon arbitration provisions. First
enacted in 1925, the FAA was intended to combat
6
CARA STEPANCZUK ET AL., MEDICAID LONG-TERM SERVICES
AND SUPPORTS USERS AND EXPENDITURES BY SERVICE CATEGORY,
2022, 5 (Centers for Medicare & Medicaid Services, 2024), https://
www.medicaid.gov/medicaid/long-term-services-supports/reportsevaluations.
6
“widespread judicial hostility to arbitration agreements.” Concepcion, 563 U.S. at 339. The Act—which
describes arbitration agreements as generally “valid,
irrevocable, and enforceable,” 9 U.S.C. § 2—has been
reinforced by this Court as representing “‘an emphatic
federal policy’” supporting parties’ ability to arbitrate.
Marmet Health Care Ctr., Inc. v. Brown, 565 U.S. 530,
533 (2012) (quoted source omitted); see also Moses H.
Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1,
24 (1983) (confirming that “questions of arbitrability
must be addressed with a healthy regard for the
federal policy favoring arbitration”).
Section 2 of the FAA “protects [the] right to enforce
arbitration agreements” and prevents courts from
“‘discriminating’” against arbitration. Viking River
Cruises, 596 U.S. at 650–51 (quoted source omitted).
Even antagonistic State rules that “disfavor[] contracts
that . . . have the defining features of arbitration agreements” are preempted by the FAA. Kindred Nursing
Ctrs. Ltd. P’ship v. Clark, 581 U.S. 246, 251 (2017).
The central congressional goal in formalizing that
federal policy housed within the FAA was to mandate
enforcement of arbitration agreements’ terms. See
KPMG LLP v. Cocchi, 565 U.S. 18, 21 (2011). This
enforcement requirement extends to the particular
terms of agreements. See Am. Express Co., 570 U.S. at
233. Notably, even in circumstances of alleged
federal statutory violations, the policy remains intact
“unless . . . ‘overridden by a contrary congressional
command.’” Id. (quoted source omitted).
By undermining the FAA’s mandate, the Arkansas
Court of Appeals’ decision jeopardizes small business
interests and broader economic prosperity. Arbitration
offers faster resolutions, cost savings, and flexibility
that small businesses—which employ “45.9% of
7
American workers” —rely on to effectively operate.
For businesses, using arbitration to resolve disputes is
a frequent and routine practice. A 2019 study on
arbitration agreements and consumer transactions
found that 81 of the Fortune 100 companies employed
arbitration agreements when contracting with consumers
and that most U.S. households “are covered by
broad consumer arbitration agreements.”8 The study
further highlighted that, as a low estimate, “at least
826,537,000 consumer arbitration agreements were in
force” in 2018, which, comparatively, is a number two
and a half times larger than the U.S. population at the
time.9 When small businesses engage in legal disputes,
most are settled outside of court, with as much as 22%
settled through arbitration or similar mechanisms.10
With significantly fewer resources than their large
corporation counterparts,11 small businesses need
cost-saving and cost-effective measures, including
7
7
Frequently Asked Questions About Small Business, 2024, U.S.
SMALL BUS. ADMIN. OFF. OF ADVOC. (July 23, 2024), https://advo
cacy.sba.gov/2024/07/23/frequently-asked-questions-about-smallbusiness-2024/.
8
Imre Stephen Szalai, The Prevalence of Consumer Arbitration
Agreements by America’s Top Companies, 52 U.C. DAVIS L. REV.
ONLINE 233, 234 (2019).
9
Id.
10
NFIB RSCH. FOUND., NFIB National Small Business Poll
The Use of Lawyers, Vol. 5 Iss. 2, at 4 (2005), http://www.
411sbfacts.com/files/UseofLawyers_poll.pdf.
11
One recent study suggests that a large number of small
businesses are operating with less than one month’s worth of cash
reserves. See Black Enterprise Eds., On the Brink: 39% Of Small
Businesses Are Running On Less Than A Month Of Cash,
YAHOO!FINANCE (Oct. 28, 2025), https://finance.yahoo.com/news/
brink-39-small-businesses-running-140000299.html.
8
arbitration, to ensure they can continue operating
long-term.
One significant advantage of arbitration is that it
takes less time than litigation. As the Court has noted,
arbitration “promise[s] [] quicker, more informal, and
often cheaper resolutions for everyone involved.” Epic
Sys. Corp., 584 U.S. at 505. Put differently, arbitration
provides “simplicity, informality, and expedition[.]”
Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth,
Inc., 473 U.S. 614, 628 (1985). Research comparing
arbitration to federal court litigation proves this to be
the case.12 Between 2014 and 2021, disputes that
consumers and employees “initiated and prevailed” on
resolved, respectively, an average of 118 days and 56
days earlier through arbitration as opposed to litigation.13
Arbitrated cases take on average between twelve and
twenty-one fewer months to complete.14
Arbitration also offers “cheaper resolutions” for
small businesses. Epic Sys. Corp., 584 U.S. at 505.
Protracted litigation imposes significant economic
harms on small businesses, including both direct and
indirect costs as well as significant opportunity
costs due to economic uncertainty.15 In 2024, small
businesses reported economic uncertainty as their
third-most pressing concern.16 Research indicates that
uncertainty created by prolonged litigation makes
12
See WEINSTEIN ET AL., supra note 2, at 10 (“[C]ases going to
award at arbitration are fully adjudicated in less time than it
takes district court cases to get to trial.”).
13
PHAM & DONOVAN, supra note 3, at 4.
14
WEINSTEIN ET AL., supra note 2, at 14–15.
15
Id. at 16–18, 22–23, 26.
16
NFIB RSCH. CTR., SMALL BUSINESS PROBLEMS AND
PRIORITIES 9 (11th ed. 2024), https://tinyurl.com/2bvwdk4e.
9
businesses less likely to invest in themselves.17 One
sample analyzing only federal court litigation between
2011 and 2015 determined that the delay caused by
litigation instead of arbitration led to between $10.9
billion and $20 billion in lost opportunity costs for
businesses.18 Accounting for economic “multiplier effects”
that compound these direct losses, the total estimated
costs associated with such delays between 2011 and
2015 is between $28.3 billion and $51.9 billion.19 And
litigation costs are not incurred equally—small
businesses shoulder a disproportionate amount.20
Beyond faster outcomes and reduced costs, arbitration affords small businesses logistical advantages
like flexibility. Arbitration is simpler and more
informal than litigation. Epic Sys. Corp., 584 U.S. at
505–06; Mitsubishi Motors Corp., 473 U.S. at 628.
These features allow small businesses to represent
themselves in arbitration or forgo expensive lawyers.
Arbitration also provides privacy and reputational
benefits to businesses by allowing records to remain
private, thus protecting businesses’ sensitive information.21 Lastly, arbitration provides businesses with
17
WEINSTEIN ET AL., supra note 2, at 16 (cited source omitted).
18
Id. at 17–18.
19
Id. at 22–23.
20
See DAVID MCKNIGHT & PAUL HINTON, U.S. CHAMBER OF
COM. INST. FOR LEGAL REFORM, TORT COSTS FOR SMALL
BUSINESSES 12–14 (2023), https://instituteforlegalreform.com/wpcontent/uploads/2023/12/Tort-Costs-for-Small-Businesses-12.5.2
3.pdf (finding that small businesses paid $160 billion in
commercial tort costs in 2021, accounting for 48% of such costs in
the U.S. despite making up only 20% of business revenue).
21
See Sheryl L. Axelrod, Why Arbitrate? Why Not? The
Benefits of Arbitrating Commercial Disputes, ABA (Aug. 29,
2025), https://www.americanbar.org/groups/business_law/resour
10
the flexibility necessary to adapt to unanticipated
circumstances, making “room for innovation” like
online arbitration.22 Innovations like online arbitration
“allow[] parties to upload and submit all supporting
documentation to support their claims at times that
suit their schedules” and “save the time, cost, and
stress of traveling to and attending in-person processes.”23
Not only does arbitration benefit small businesses,
but it benefits courts by reducing judicial caseloads.
When judges are unable to timely resolve cases, it
“stall[s] the progression of legal precedents that are
vital to economic, technological, and social advancement, and undermine[s] public trust in the legal
system.”24 However, judicial caseloads––in both federal
and state courts––have increased sharply over the
past few decades.25 The problem has gotten so dire
that, in 2023, the Judicial Conference of the United
States recommended adding 75 new permanent
ces/business-law-today/2025-august/why-arbitrate-why-not-bene
fits-arbitrating-commercial-dispute/.
22
Schmitz, supra note 4, at 249–50.
23
Id. at 248.
24
See supra note 5.
25
Id. (noting the 346 percent increase in pending civil cases in
federal courts between 2004 and 2024); see also Paula HannafordAgor, Our New Normal? How Covid-19 Accelerated Pre-Pandemic
Trends in State Court Litigation, 71 DEPAUL L. REV. 279, 294–95
(2022), https://via.library.depaul.edu/cgi/viewcontent.cgi?article=
4188&context=law-review (noting that many state courts face
“significant civil case backlogs”).
11
federal judgeships. By reaffirming the mandate of the
FAA, the Court can help reduce extant judicial
backlogs. Allowing parties to choose arbitration will
contribute to lower judicial caseloads. Both state and
federal judges attribute the decrease in jury trials to
the rise in arbitration.27 With lighter caseloads, judges
can focus on more difficult cases and resolve pending
cases faster, benefitting all parties.
26
The FAA represents a favorable federal policy toward
arbitration. Arbitration provides small businesses,
and all parties, with quicker resolutions, reduced costs,
and increased flexibility. Parties choosing to arbitrate
promotes judicial efficiency. Thus, this Court should
grant the Petition to reaffirm the FAA’s policy
promoting arbitration in light of the Arkansas Court
of Appeals’ judicial hostility to arbitration.
II. CMS’s Ban on Arbitration Agreements as a
Condition of Admission Is Ultra Vires
The APA requires reviewing courts to set aside
agency action that is “in excess of statutory jurisdiction, authority, or limitations, or short of statutory
right.” 5 U.S.C. § 706(2)(C). The court first determines
“whether the agency has stayed within the bounds of
26
Federal Judiciary Seeks New Judgeship Positions, U.S. CTS.
(Mar. 14, 2023), https://www.uscourts.gov/data-news/judiciarynews/2023/03/14/federal-judiciary-seeks-new-judgeship-positions.
27
See Shari Seidman Diamond & Jessica M. Salerno, Reasons
for the Disappearing Jury Trial: Perspectives from Attorneys and
Judges, 81 LA. L. REV. 119, 144 (2020), https://digitalcomm
ons.law.lsu.edu/cgi/viewcontent.cgi?article=6816&context=lalrev
(sampling 173 state and federal judges and 1,282 attorneys
practicing both civil and criminal law and finding that judges
viewed binding arbitration as having a strong effect of reducing
jury trial rates).
12
its statutory authority.” City of Arlington v. FCC, 569
U.S. 290, 297 (2013). If not, the action is “ultra vires”
and must be set aside. Id.; 5 U.S.C. § 706(2). This is so
because agencies have no power to act outside of a
grant of authority from Congress. NFIB v. OSHA, 595
U.S. 109, 117 (2022) (“Administrative agencies are
creatures of statute. They accordingly possess only the
authority that Congress has provided.”); see also La.
Pub. Serv. Comm’n v. FCC, 476 U.S. 355, 374 (1986)
(“[A]n agency literally has no power to act . . . unless
and until Congress confers power upon it.”).
Medicare provides subsidized healthcare for, among
others, certain “individuals who are age 65 or over”
and those with a disability. 42 U.S.C. § 1395c. Medicaid
provides subsidized healthcare to individuals “whose
income and resources are insufficient to meet the costs
of necessary medical services.” 42 U.S.C. § 1396-1.
Regarding care facilities, CMS is empowered to
enforce such requirements as are “adequate to protect
the health, safety, welfare, and rights of residents and
to promote the effective and efficient use of public
moneys,” 42 U.S.C. §§ 1395i-3(f)(1), 1396r(f)(1), and
“such other requirements relating to the health, safety,
and well-being of residents or relating to the physical
facilities thereof as the Secretary may find necessary.”
42 U.S.C. § 1395i-3(d)(4)(B); see also 42 U.S.C.
§ 1396r(d)(4)(B) (using nearly identical language).
CMS enacted a regulation forbidding long-term care
facilities from “requir[ing] any resident or his or her
representative to sign an agreement for binding arbitration as a condition of admission to, or as a
requirement to continue to receive care at, the facility[.]”
42 C.F.R. § 483.70(m)(1). However, an examination of
the language of the Medicare and Medicaid Acts
13
reveals that the rule is beyond the scope of CMS’s
authority and therefore ultra vires.
A. Congress Did Not Clearly Displace the
FAA When it Enacted the Medicaid and
Medicare Acts
Congress knows how to give agencies the authority
to regulate or prohibit the use of arbitration agreements. In fact, it has, on multiple occasions, used clear
and direct language to do exactly that. The fact that
Congress did not do so here means it did not grant
CMS that authority.
For example, the Dodd-Frank Wall Street Reform
and Consumer Protection Act allows the Consumer
Financial Protection Bureau, in certain situations, to
“prohibit or impose conditions or limitations on the use
of an agreement between a covered person and a
consumer for a consumer financial product or service
providing for arbitration of any future dispute between
the parties.” 12 U.S.C. § 5518(b). Similarly, in a provision
explicitly entitled “Authority to restrict mandatory predispute arbitration,” Congress authorized the Securities
and Exchange Commission to “prohibit, or impose
conditions or limitations on the use of, agreements
that require customers or clients of any broker, dealer,
or municipal securities dealer to arbitrate any future
dispute between them.” 15 U.S.C. § 78o(o).
Yet no such language exists in the Medicare or
Medicaid Acts, nor is a congressional “intention to
preclude a waiver of judicial remedies” discoverable in
the text, legislative history, or through an inherent
conflict between arbitration and the Acts’ underlying
purposes. Gilmer v. Interstate/Johnson Lane Corp.,
500 U.S. 20, 26 (1991) (noting that such intention must
be discoverable in the text, legislative history, or
14
purposes of the statute). Here, the underlying statutory
authority confers only a general policy of care and
protection for residents that is far short of the
necessary “clear and manifest congressional command
to displace the [FAA].” Epic Sys. Corp., 584 U.S. at 511.
In Epic Systems, the Court held that a statute
generally detailing the rights of workers to organize
and engage in collective bargaining was insufficient to
forbid arbitration agreements. Id. The Court reasoned
that the statute at issue “d[id] not express approval or
disapproval of arbitration” nor “even hint at a wish to
displace the Arbitration Act.” Id. So too is the case
here. Neither the Medicare nor Medicaid Act speaks
to, let alone disapproves of, arbitration. This lack of
statutory language regarding arbitration reveals that
CMS exceeded its authority.
Nor can the phrase “such other requirements” perform
the necessary lift of giving CMS the authority to
regulate or prohibit arbitration agreements. As stated
previously, this Court requires a clear statement from
Congress to displace the FAA. Epic Sys. Corp., 584 U.S.
at 511. “Such other requirements” is anything but a
clear statement regarding arbitration, and any argument to the contrary must fall flat. Indeed, if phrases
like “such other requirements” were read so broadly,
the statute would “assum[e] near-infinite breadth.”
But see FERC v. Elec. Power Supply Ass’n, 577 U.S. 260,
278 (2016) (explaining that courts must apply a “nonhyperliteral reading” to similar phrases). Nor would
Congress hide the elephant of broadly prohibiting
arbitration agreements in the mousehole of “such
other requirements.” Whitman, 531 U.S. at 468.
Entirely absent from the text of the Medicare or
Medicaid Acts is a grant of authority for CMS to
regulate arbitration. Nor can the ancillary and vague
15
phrase “such other requirements . . . as the Secretary
may find necessary,” without more, displace 100 years
of federal law favoring arbitration.
B. Congress Excluded the Power Claimed
by CMS and it Should Not Be Read into
the Statute
“The expression of one thing implies the exclusion of
others (expressio unius est exclusio alterius).” Antonin
Scalia & Bryan A. Garner, Reading Law: The
Interpretation of Legal Texts 107 (2012). This court has
affirmed the principle multiple times. See, e.g., Bittner
v. United States, 598 U.S. 85, 94–95 (2023).
The Acts at issue in this case explicitly state that
facilities may not “require individuals . . . to waive
their rights to benefits,” “require oral or written
assurance that such individuals are not eligible for, or
will not apply for, benefits,” or “require a third party
guarantee of payment to the facility.” 42 U.S.C.
§§ 1395i-3(c)(5)(A)(i)–(ii), 1396r(c)(5)(A)(i)–(ii). Nothing in
the clearly enumerated list of forbidden conditions on
admission indicates that a prohibition against arbitration agreements is included. The inclusion of a specific
prohibitions list, which excludes a prohibition on arbitration agreements, is further evidence that the Acts
do not grant CMS authority to prohibit these agreements.
Nothing in the text of the Medicaid or Medicare Acts
gives CMS authority to regulate arbitration agreements.
The Court should grant the Petition to affirm the
fundamental principle that agencies have only those
powers given to them by Congress.
16
III. CMS’s Rule Violates the Major Questions
Doctrine
Congress must “speak clearly” if it intends to grant
agencies power to decide issues of “vast ‘economic and
political significance.’” Util. Air, 573 U.S. at 324
(quoted source omitted); see also West Virginia, 597
U.S. at 716, 723–24. The major questions doctrine, as
applied by this Court, is a two-part inquiry: 1) does the
agency’s claim of authority involve an issue of vast
economic and political significance, and 2) is there a
“clear congressional authorization” for such authority?
West Virginia, 597 U.S. at 723–24, 732 (determining
first that it was a major questions case and then
looking for an authorization from Congress).
Numerous factors suggest that an issue is one of
“economic or political significance” subject to the major
questions doctrine. In NFIB, the sheer number of
people subject to the agency’s vaccine mandate—84
million—caused “little doubt” that the mandate was
such a question. 595 U.S. at 117; see also Biden v.
Nebraska, 600 U.S. 477, 501 (2023) (identifying a major
questions case involving 43 million Americans). Another
indicator is the cost to the national economy or to a
sector. Cases involving billions of dollars are typically
major questions cases. See Nebraska, 600 U.S. at 501,
502 (finding “staggering” economic significance in
power to regulate $430 billion in student loan cancellation); Ala. Ass’n of Realtors v. Dep’t of Health and Hum.
Servs., 594 U.S. 758, 764 (2021) (major questions case
involving $50 billion in economic impact).
This is a major questions case—CMS’s arbitration
rule claims the extraordinary power to dictate the
terms of admission contracts for thousands of facilities
and over a million residents, potentially reshaping a
nationwide market in which arbitration is the
17
standard mechanism for allocating risk and resolving
disputes.28 Long-term care is a major national
enterprise: in 2022, 1.5 million institutional service
users accounted for $71 billion in institutional longterm services and supports spending with $59.1 billion
(83.2%) of this funding going to nursing facilities.29 In
this case, the financial impact exceeds that which the
Court determined to be a major question in the
eviction moratorium case. Ala. Ass’n of Realtors, 594
U.S. at 764 (major questions case involving $50 billion
in economic impact). A federal mandate that reorders
the forum for resolving disputes in a sector measured
in tens of billions of dollars annually squarely implicates
other major questions doctrine cases. See West Virginia,
597 U.S. at 714 (“the rule would entail billions of dollars in
compliance costs . . ., require the retirement of dozens
of coal plants, and eliminate tens of thousands of jobs”).
Moving to the second part of the major questions
inquiry, nothing in the Medicare or Medicaid Acts
clearly authorizes CMS to regulate private arbitration
agreements. The Acts authorize the Department of
Health and Human Services (HHS) to impose conditions on long-term care facilities that are “adequate to
protect the health, safety, welfare, and rights of
residents and to promote the effective and efficient use
of public moneys,” 42 U.S.C. §§ 1395i-3(f)(1), 1396r(f)(1),
28
Department of Health and Human Services, Office of
Inspector General, Nursing Homes (Dec. 20, 2024), https://oig.
hhs.gov/reports/featured/nursing-homes/ (“According to Centers
for Medicare & Medicaid Services (CMS) data, in July 2022,
approximately 1.2 million people resided in more than 15,000
certified nursing homes.”); 84 Fed. Reg. 34718, 34722 (July 18,
2019) (“[T]he vast majority of commenters from the [long-term
care] industry have argued for the continued use of arbitration
agreements for reasons of cost and efficiency.”).
29
STEPANCZUK ET AL., supra note 6, at 5.
18
and “such other requirements relating to the health,
safety, and well-being of residents or relating to the
physical facilities thereof as the Secretary may find
necessary.” 42 U.S.C. § 1395i-3(d)(4)(B); see 42 U.S.C.
§ 1396r(d)(4)(B) (using nearly identical language). As
discussed in Section II, supra, nothing in these provisions even arguably gives CMS the power to regulate
or prohibit arbitration agreements. And certainly
nothing in the text counts as Congress speaking
clearly or providing a clear congressional authorization on the issue.
Similar to West Virginia, where the Court found
the EPA’s reliance on “best system of emission
reduction . . . adequately demonstrated” could not justify
a nationwide carbon emissions cap, the statutory
provisions at issue here—“such other requirements,”
“adequate to protect the health . . .,” and “promote the
effective and efficient use of public moneys”—cannot
be stretched to authorize CMS’s regulation of predispute forum-selection clauses. 597 U.S. at 732, 734–
35. Nor does regulation of arbitration agreements “fit[]
neatly” within the purview of CMS or HHS. But see
Biden v. Missouri, 595 U.S. 87, 93 (2022) (upholding
vaccination mandate for healthcare workers because
protecting patient health and safety within Medicareand Medicaid-certified facilities was under longstanding HHS authority). CMS’s arbitration rule polices
the terms of private admission contracts and the
forum for adjudicating post-injury tort claims, not
clinical practice, health, or safety itself inside facilities.
See 42 C.F.R. § 483.70(m).
At its core, the major questions doctrine guards the
separation of powers and ensures that agencies cannot
usurp authority over significant issues without authorization. Here, CMS has tried to do just that by
19
prohibiting the use of arbitration agreements in a
nationwide industry, with billions of dollars in
economic impact.
CONCLUSION
This Court should grant the Petition for Certiorari.
Respectfully submitted,
ARAM A. GAVOOR
Counsel of Record
THE GEORGE WASHINGTON
UNIVERSITY LAW SCHOOL
ADMINISTRATIVE LAW,
ISSUES, AND APPEALS CLINIC
2000 G Street NW
Washington, DC 20052
(202) 994-2505
agavoor@law.gwu.edu
Counsel for Amicus Curiae
December 1, 2025
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.