Forum Shopping for Arbitration Decisions: Federal Courts' Use of Antisuit Injunctions Against State Courts
Arbitration clauses, which are supposed to do away with litigation, have ironically spawned many complicated and expensive court fights. Some of the most complex cases involve both forum shopping by the parties and jurisdictional turf battles between federal and state courts. Federal courts have, on quite a few occasions, actually gone so far as to enjoin a state court from continuing to consider a pending case because the federal court concluded that the matter ought to be arbitrated. The Supreme Court, however, has never ruled on whether or when such "arbitral antisuit injunctions" are permissible. In Moses H. Cone Memorial Hospital v. Mercury Construction Corp., the Supreme Court expressly reserved ruling on the question of whether, given abstention principles, federal courts "might stay a state-court suit pending arbitration," and the Court has not come back to the question since then. This Article thus attempts to determine when, if ever, federal courts should be permitted to enjoin state court determinations in order to allow arbitration to proceed. This article concludes by arguing that the federal courts' typical failure to apply many of the doctrines that might preclude arbitral injunctions or to draw the factual distinctions set out above is symptomatic of courts' frequent over-enthusiasm for contractual arbitration. This failure may also allow big businesses to gain an unfair advantage over "little guys." As I have argued elsewhere, it is by no means clear that courts' extreme preference for arbitration over litigation is supported either by the legislative history of the FAA or by policy considerations. Instead, where federal courts issue arbitral antisuit injunctions in defiance of dominant principles of federalism and comity, federal courts disparage state courts' capacity for fairness more seriously than can be justified by the federal supremacy interest. In effect, the federal courts are making an invidious comparison between the state forum and an arbitral forum in the guise of resolving a jurisdictional conflict between the federal and state forums. Moreover, this preference for arbitration over litigation raises constitutional concerns. Thus, it is crucial that federal courts carefully consider the permissibility of antisuit injunctions in light of the relevant jurisdictional doctrines and the particular facts of each case.
147 U. Pa. L. Rev. 91 (1998).
Sternlight, Jean R., "Forum Shopping for Arbitration Decisions: Federal Courts' Use of Antisuit Injunctions Against State Courts" (1998). Scholarly Works. 267.