Henry Schein, Inc., II: Post-Argument Analysis

The Supreme Court heard argument in the second iteration of Henry Schein, Inc. v. Archer & White Sales, Inc., Case No. 19-963, (Henry Schein II) on December 8, 2020, which was broadcast live on CSPAN and is available here.  During the course of the argument and questioning, the Court made clear that it was only considering a narrow question:  Assume that the contract generally says that an arbitrator decides if a particular dispute must be arbitrated, rather than be litigated in a court. Also assume that the contract says claims for injunctive relief are not subject to arbitration. The parties to the contract have a dispute, and they disagree on whether the dispute seeks injunctive relief. Who decides this threshold dispute—an arbitrator or a court? (For more background on this case, see our pre-argument discussion on the issues presented.)

The question presented to the Court in Henry Schein II seems to be one of pure contract interpretation, which makes it an odd choice for the Court to hear. The Court is ostensibly deciding whether the carve-out for injunctive relief claims in this contract limits just the scope of arbitration or also limits the scope of the contract’s delegation to the arbitrator to decide the threshold issues of arbitrability. Yet, the oral argument revealed a few themes that indicate some of the broader implications of this litigation.

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Arbitrability Returns to the Supreme Court in Henry Schein, Inc. v. Archer & White Sales, Inc., the Sequel

Arbitrability—or who decides what claims are subject to arbitration—is returning to the Supreme Court next week for the second time in as many years.  The first time the matter reached the Court, the Supreme Court  unanimously held that, where a contract clearly and unmistakably delegates questions of arbitrability to an arbitrator, a court cannot decide the issue in the first instance, even if the court thinks the argument for arbitration is “wholly groundless.”  Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S. Ct. 524 (2019).

The issue has now returned to the Supreme Court following remand and a new decision by the Fifth Circuit.  Archer & White Sales, Inc. v. Henry Schein, Inc., 935 F.3d 274 (5th Cir. 2019).  On December 8, 2020, the Court will hear the case again, this time to decide “[w]hether a provision in an arbitration agreement that exempts certain claims from arbitration negates an otherwise clear and unmistakable delegation of questions of arbitrability to an arbitrator.”

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