McCormick v. America Online, Inc.

The plaintiff, who arbitrated a claim that arose under a federal statute, the Electronic Communications Privacy Act of 1986 (known as the Stored Communications Act), 18 U.S.C. 2701, sought to vacate or modify the arbitration award. The plaintiff filed a motion in the district court; for jurisdiction, he invoked 28 U.S.C. 1331 (federal-question jurisdiction) and 1332 (diversity jurisdiction). The Federal Arbitration Act, 9 U.S.C. 10-11, which provides for the enforceability of arbitration agreements and specifies procedures for conducting arbitrations and enforcing arbitration awards, does not provide an independent jurisdictional basis for disputes under the Act. The Fourth Circuit vacated the dismissal of the action, stating that the better approach for determining subject-matter jurisdiction over section 10 and 11 motions is to look to the nature of the underlying claim in dispute, as is done with respect to section 4 petitions to compel arbitration. If the underlying claim is one that otherwise could be litigated in federal court, the motion can likewise be resolved in federal court. The district court had federal-question jurisdiction because the plaintiff’s underlying claim arose under federal law. View "McCormick v. America Online, Inc." on Justia Law