## Facts

- Dr. John Ivan Sutter, a pediatrician, contracted with Oxford Health Plans LLC under a Primary Care Physician Agreement for reimbursement for services to Oxford’s insureds.
- The agreement contained a broad arbitration clause requiring arbitration of disputes and barring civil actions in court.
- Sutter filed a putative class action in New Jersey state court alleging Oxford systematically underpaid him and other similarly situated physicians.
- The state court compelled arbitration, and the parties expressly submitted to the arbitrator the question whether the contract authorized class arbitration.
- The arbitrator construed the clause as permitting class proceedings, reasoning that its broad bar on court litigation encompassed class actions, and he certified a class.
- After Stolt-Nielsen S.A. v. AnimalFeeds International Corp. (2010), Oxford argued the contract could not support class arbitration; the arbitrator reaffirmed his prior interpretation.
- Oxford sought to vacate the clause-construction award in federal court under FAA § 10(a)(4), arguing the arbitrator exceeded his powers; the district court denied vacatur and the Third Circuit affirmed.

## Issues

1. Whether an arbitrator “exceeds [his] powers” under FAA § 10(a)(4) by interpreting a broadly worded arbitration clause to authorize class arbitration when the contract contains no express class-arbitration language.
2. Whether Stolt-Nielsen requires vacatur when a court believes the arbitrator incorrectly found contractual consent to class arbitration.

## Decision

- The Supreme Court unanimously affirmed the Third Circuit.
- The Court held the arbitrator did not exceed his powers under FAA § 10(a)(4) because he was interpreting the parties’ contract, as the parties asked him to do.
- The Court ruled that judicial review under § 10(a)(4) does not permit vacatur for legal or interpretive error, even serious error, so long as the award is based on an arguable construction of the contract.
- The Court distinguished Stolt-Nielsen because there the parties stipulated there was no agreement on class arbitration and the arbitrators did not ground their decision in contractual interpretation.
- A concurrence noted potential future disputes over whether absent class members can be bound by class arbitration absent clear consent, but agreed vacatur was unavailable on this record.

## Legal Principles

- FAA § 10(a)(4) permits vacatur only when an arbitrator exceeds the authority the parties granted; the challenger bears a heavy burden.
- When parties submit a question of contract interpretation to an arbitrator, the reviewing court asks only whether the arbitrator interpreted the contract, not whether the interpretation was correct.
- An award must be confirmed if it is even arguably construing or applying the contract; courts may not re-decide the contract’s meaning under the guise of § 10(a)(4) review.
- Stolt-Nielsen addresses the absence of contractual consent to class arbitration when arbitrators do not engage in contractual interpretation (including when parties stipulate no agreement), but it does not alter the § 10(a)(4) standard of judicial review.

## Conclusion

Because the arbitrator’s decision authorizing class arbitration rested on his construction of the parties’ arbitration clause—a task the parties specifically delegated—FAA § 10(a)(4) did not allow a court to vacate the award merely for an alleged misreading of the contract.


Oxford Health Plans LLC v. Sutter, 569 U.S. 564 (2013)