## Facts

- Denise Badgerow, a former financial advisor at REJ Properties, Inc., agreed to arbitrate disputes with three company principals, including Greg Walters.
- After her termination, Badgerow brought FINRA arbitration claims alleging tortious interference and violations of Louisiana whistleblower law.
- The arbitration panel dismissed Badgerow’s claims with prejudice.
- Badgerow filed in Louisiana state court to vacate the award, alleging the award was procured by fraud.
- The principals removed to federal court and sought confirmation of the award.

## Issues

1. Whether a federal court deciding an application to confirm (§ 9) or vacate (§ 10) an arbitral award may “look through” to the underlying dispute to find federal-question jurisdiction.
2. Whether, absent diversity or a federal issue on the face of the §§ 9–10 application, a federal court has subject-matter jurisdiction over post-award FAA proceedings.

## Decision

- The Supreme Court reversed the Fifth Circuit and remanded.
- The Court held, 8–1, that the “look-through” approach applies to FAA § 4 petitions to compel arbitration but does not extend to FAA §§ 9 and 10 applications to confirm or vacate awards.
- Because the application itself raised no federal issue and diversity jurisdiction was lacking, federal subject-matter jurisdiction was absent.

## Legal Principles

- The Federal Arbitration Act does not itself confer federal subject-matter jurisdiction; an independent jurisdictional basis is required.
- “Look-through” jurisdiction is permitted for FAA § 4 because that provision’s text directs courts to assess whether, absent the arbitration agreement, the court would have jurisdiction over the underlying controversy.
- FAA §§ 9 and 10 lack § 4’s “save for” and “arising out of the controversy” language; jurisdiction for confirmation/vacatur must be determined from the face of the application, not the underlying arbitration dispute.
- Policy concerns about fragmented federal and state supervision of arbitration cannot override statutory text allocating jurisdiction.

## Conclusion

Federal courts may not rely on the underlying arbitration’s federal issues to establish jurisdiction over FAA §§ 9 and 10 proceedings; unless the confirmation or vacatur application independently satisfies federal-question or diversity jurisdiction, it must proceed in state court.


Badgerow v. Walters, 596 U.S. 1 (2022)