## Facts

- Archer & White Sales, Inc. and a distributor later alleged to be Henry Schein, Inc.’s predecessor entered a Dealer Agreement containing an arbitration clause.
- Archer sued Schein in federal court alleging federal and state antitrust violations, seeking damages and injunctive relief.
- The arbitration clause required arbitration under AAA rules for disputes “arising under or related to” the agreement, but excluded “actions seeking injunctive relief” and certain intellectual-property-related disputes.
- Schein moved to compel arbitration under the Federal Arbitration Act (FAA); Archer argued the request for injunctive relief placed the case within the carve-out.
- The magistrate judge compelled arbitration, reasoning that incorporation of AAA rules showed intent to have the arbitrator decide arbitrability.
- The district court vacated and denied arbitration, holding the court could decide arbitrability and that the injunctive-relief carve-out applied.
- The Fifth Circuit affirmed, applying a circuit rule that even with a delegation, a court may decide arbitrability when the pro-arbitration argument is “wholly groundless.”

## Issues

1. Whether the FAA permits a court to refuse to enforce an agreement delegating “gateway” arbitrability questions to an arbitrator because the court views the arbitrability argument as “wholly groundless.”

## Decision

- The Supreme Court unanimously reversed and remanded.
- The Court held the FAA contains no “wholly groundless” exception to enforcing a valid delegation of arbitrability.
- The Court vacated the Fifth Circuit’s judgment and remanded for the lower court to determine whether the contract in fact clearly and unmistakably delegated arbitrability.

## Legal Principles

- Arbitration is a matter of contract, and courts must enforce arbitration agreements according to their terms under the FAA.
- Parties may delegate “gateway” questions of arbitrability (including whether an agreement covers a dispute) to an arbitrator.
- Courts may not presume the parties delegated arbitrability absent “clear and unmistakable” evidence of that intent.
- If a valid delegation exists, the court lacks authority to decide arbitrability, even if the court believes the arbitrability position is weak or frivolous.

## Conclusion

The Court rejected the Fifth Circuit’s “wholly groundless” doctrine, holding that when parties clearly delegate arbitrability to an arbitrator, the FAA requires courts to enforce that delegation and leave arbitrability to the arbitrator.


Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019)