## Facts

- Mitsubishi Motors Corporation and Chrysler International, S.A. (CISA) participated in an arrangement to distribute Mitsubishi-made vehicles through Chrysler dealers outside the continental United States.
- Soler Chrysler-Plymouth, Inc., a Puerto Rico Chrysler dealer, entered distribution and sales agreements with CISA and Mitsubishi to sell Mitsubishi vehicles in Puerto Rico.
- The sales agreement included a clause requiring arbitration in Japan before the Japan Commercial Arbitration Association for disputes “arising out of or in relation to” specified contract provisions or breaches.
- After sales declined, the parties disputed Soler’s performance, shipments, and payments; Mitsubishi withheld shipments, and Soler disclaimed responsibility.
- Soler asserted counterclaims including federal antitrust claims under the Sherman Act, as well as claims under the Automobile Dealers’ Day in Court Act and Puerto Rico law.
- Mitsubishi sued in federal district court to compel arbitration under the Federal Arbitration Act (FAA) and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention).

## Issues

1. Whether a broadly worded arbitration clause in an international commercial agreement governed by the FAA and New York Convention encompasses statutory claims, including Sherman Act claims.
2. Whether federal antitrust claims are categorically nonarbitrable on public-policy grounds in this international setting.

## Decision

- The Supreme Court reversed the court of appeals insofar as it refused to compel arbitration of Soler’s Sherman Act claims.
- The Court held that antitrust claims arising from an international commercial agreement are arbitrable under the FAA and the New York Convention absent an explicit congressional directive to the contrary.
- The Court concluded the clause covering disputes “arising out of or in relation to” the agreement could reach statutory claims connected to the contractual relationship, even if the clause did not name particular statutes.
- The Court rejected the view that the complexity or importance of antitrust issues, by itself, makes arbitration an inadequate forum.
- The Court stated that agreement to arbitrate a statutory claim does not waive substantive statutory rights; it selects an arbitral forum for their resolution.
- The Court indicated that concerns about foreign arbitrators failing to apply U.S. antitrust law were speculative and could be addressed at the award-enforcement stage.
- The Court recognized a public-policy limit: if choice-of-forum and choice-of-law provisions operated as a prospective waiver of statutory remedies, the agreement could be unenforceable; the record did not establish such a waiver here.
- Justice Stevens dissented (joined by Justice Brennan; Justice Marshall in part), arguing antitrust claims should not be sent to foreign arbitration and that the contract did not clearly cover them; Justice Powell did not participate.

## Legal Principles

- Under the FAA, courts generally must enforce arbitration agreements according to their terms, including in disputes involving federal statutory claims, unless Congress has clearly indicated otherwise.
- In international commerce, the federal policy favoring enforcement of arbitration agreements applies with particular force, consistent with the New York Convention’s objective of enforcing international arbitration agreements.
- A broad arbitration clause covering disputes “arising out of or in relation to” an agreement presumptively includes statutory claims that arise from the parties’ commercial relationship.
- Agreement to arbitrate a statutory claim does not relinquish the statute’s substantive protections; it replaces judicial adjudication with arbitral adjudication.
- An arbitration agreement may be unenforceable on public-policy grounds if, through forum and law selections, it effectively operates as a prospective waiver of the ability to pursue statutory remedies.

## Conclusion

The Court held that Sherman Act claims connected to an international commercial contract must be sent to arbitration under the parties’ agreement and the FAA and New York Convention, absent a clear congressional command forbidding arbitration or a showing that the contract provisions would effectively bar pursuit of statutory remedies.


Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985)