DIRECTV, Inc. v. Imburgia: How the Supreme Court Used a Jedi Mind Trick To Turn Arbitration Law Upside Down

36 Pages Posted: 3 Apr 2016 Last revised: 4 Apr 2017

See all articles by Imre S. Szalai

Imre S. Szalai

Loyola University New Orleans College of Law

Date Written: March 29, 2016

Abstract

The Federal Arbitration Act (FAA) is the primary federal statute governing millions of arbitration agreements that have mushroomed in every nook and cranny of modern American society. The Supreme Court of the United States has grossly erred when construing and applying the FAA in a long series of cases spanning the last few decades, and these flawed decisions have encouraged this explosion of arbitration agreements across America. In its most recent FAA decision from December 2015, DIRECTV, Inc. v. Imburgia, 136 S. Ct. 463 (2015), the Supreme Court continued its awkward tradition of issuing preposterous FAA rulings. However, the Court in DIRECTV reached a new low, a result so extreme and “dangerous,” according to the dissenting Justices, that the Court’s DIRECTV decision turns arbitration law completely upside down.

This Article explores the Supreme Court’s deeply flawed interpretation of the FAA in DIRECTV. The Court’s decision desecrates the most fundamental principle of arbitration law, that arbitration must be based on the agreement of the parties. The Court in DIRECTV overrides the intent of the parties in this case, as well as the intent of Congress in enacting the FAA. The first part of this Article explains the background of the DIRECTV case. The second part of the Article closely examines the deep, multiple flaws in the opinion. Finally, the Article concludes by addressing how DIRECTV’s holding applies to some common hypotheticals in order to demonstrate the broader impact of this case in shutting off access to America’s civil justice system.

Keywords: Federal Arbitration Act, Arbitration, Dispute Resolution, Consumer Protection, Civil Procedure, Class Actions

JEL Classification: K1, K4

Suggested Citation

Szalai, Imre S., DIRECTV, Inc. v. Imburgia: How the Supreme Court Used a Jedi Mind Trick To Turn Arbitration Law Upside Down (March 29, 2016). 32 Ohio State Journal on Dispute Resolution 75 (2017), Loyola University New Orleans College of Law Research Paper No. 2017-02, Available at SSRN: https://ssrn.com/abstract=2756149

Imre S. Szalai (Contact Author)

Loyola University New Orleans College of Law ( email )

7214 St. Charles Ave., Box 901
Campus Box 901
New Orleans, LA 70118
United States

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